Above: POA President Doug Pitassi shares stories of companies that had been successful with transformation such as Amazon, IBM, and Marvel Entertainment during January’s “Transformation” Sales Meeting.
Pacific Office Automation sets the standard for excellence as it extends its borders beyond the Pacific Northwest.
If there’s such a thing as warp speed, Doug Pitassi, president of Pacific Office Automation (POA), is cruising at it. Recently, POA’s annual dealer meeting was scheduled to kick off on Saturday afternoon at 2. Pitassi had a rehearsal scheduled for 7:30 Friday morning, and while much of his attention was focused on the meeting, he was still tending to business at 3:30 on Thursday afternoon when we arrived at his Portland, Oregon, headquarters for an interview and tour.
Visiting POA on the eve of its annual sales meeting could have been the worst time to visit. Instead, it was the best. Spending a few hours with Pitassi, along with meeting his employees and seeing the reverence POA’s vendors have for the company, revealed just how exciting, vibrant, and inspiring this industry remains.
The upcoming sales meeting was the first thing we queried Pitassi about, and it became the main topic of conversation for the next 40 minutes. It’s difficult not to get swept up in his enthusiasm about the meeting, a meeting with production values rivalling those of an OEM meeting. As Pitassi provided us with a historical timeline of POA’s past sales meetings, punctuating his points with videos from past meetings and a preview of this year’s presentations.
Calling a POA sales meeting a sales meeting is somewhat of a misnomer. It’s more of an event, or show, if you will, that masterfully mixes business with fun, while vividly encapsulating the company and its culture. This year’s event had rappers, dancers, a rap competition among POA’s top 10 sales people, and the obligatory PowerPoint slides recapping the past year’s performance in various categories, as well as POA’s goals for 2018.
The event is attended by virtually every one of the company’s nearly 1,000 employees from the company’s 21 offices, along with representatives from business partners such as ACDI, Canon, HP, Lexmark, Konica Minolta, Ricoh, Sharp, U.S. Bank, and Wells Fargo, among others. The Saturday afternoon sales meeting was followed by a dinner for employees and significant others, as well as business partners. The evening included awards presentations and another rap competition””this one pitting POA’s OEMs against each other. That competition alone was worth the price of admission.
How does a dealership founded in 1976 with zero base grow into a $311-plus million company with more than 25,000 customers and the resources to stage an event of this magnitude?
“We have a lot of fun, but we work hard and play hard,” Pitassi told us.
But there’s more to it than that.
Although Pitassi was center stage for much of the sales meeting and served as our gracious host on Thursday afternoon, you can’t talk about POA without acknowledging POA’s founder Terry Newsom who is still active in the company, even though Pitassi handles much of the day-to-day responsibilities befitting his title as president. Indeed, Newsom’s presence looms large at POA and his ability to empower and delegate is one reason for the company’s success.
“Terry lets people lead,” acknowledged Pitassi.
During our meeting, Pitassi constantly buzzed his administrative staff on the intercom to bring in documentation and other materials to illustrate not only what we were going to see on Saturday, but to also help us better understand POA and its culture. (“I have the best administrative staff ever,” he told us after the fourth or fifth time he buzzed for something.) Throughout our conversation, Pitassi continued to conduct business””his door was always open even when it was closed””handling contract questions from reps, signing paperwork. It seemed as if it was business as usual, with Pitassi pretty much doing what we think he’d be doing if we weren’t sitting in his office late Thursday afternoon and POA’s sales meeting wasn’t less than 48 hours away.
There’s a strong emphasis on company culture from top to bottom at POA. Signs throughout the building brand the Culture Club, highlighting words and phrases such as empowerment, passion, mentoring, accountability, growth, trust, and family and community that strive to define the dealership’s culture. It’s a concept Pitassi borrowed from John Lowery of Applied Imaging. The point is to ensure everybody””employees and customers””understand what POA does well.
POA is well served by a youthful staff, many of whom spearhead the dealership’s sales efforts, raising revenues to new heights. That young vibrancy was displayed on our tour of the facility and during the Saturday sales meeting. As a case in point, Pitassi’s son Eric, just two years out of college, is one of the company’s most successful sales reps and was the top sales person in the Futures Club awards on Saturday. While the Saturday afternoon rap competition featured a few seasoned POA reps among the top 10 sales people, youth dominated that competition””a reflection of how tuned in the company is to its youthful culture.
POA’s story should be familiar to most readers north of 50 years of age, maybe less so for those under the half century mark. For those of you in that age group, let’s do a quick recap.
POA started as a Sharp dealer in 1976. In the early 1990s, POA became a Minolta dealer after the IKON branches dropped the line and Minolta needed a dealer in Portland. But POA’s model for adding Minolta to the mix had a twist. Rather than disrupt the Sharp relationship by selling two lines from a single branch, POA opened a separate branch solely to sell Minolta. A variation of that model continues today with separate groups selling Sharp, Konica Minolta, Canon, and Ricoh. In three major markets””Portland, Seattle, and Phoenix””POA has competing divisions. Plans are underway to add a second division in Denver, as well as in the Bay area.
“It helps with market penetration,” explained Pitassi.
Even though each division within POA competes against each other, it’s not as cutthroat as one might think. Yes, there’s a healthy internal rivalry, but one that pays huge dividends. It’s not unusual for some of POA’s customers and prospects to receive three separate bids from POA””from the Canon, Ricoh, and Konica Minolta divisions, for example. It sounds unorthodox, but it works, and when it makes sense, two divisions will work together on a deal. That approach also works for POA’s manufacturers.
“They want part of the action that goes on here,” said Pitassi. “It’s not all going to go to one. Same with the lease companies.”
Rules of engagement are key to making this model work, as is managing people, processes, and holding people accountable for their actions and performance.
“It’s that simple,” stated Pitassi, who acknowledged that when the concept was first implemented, it took time for some reps to embrace it and adhere to the rules of engagement.
“If you went in and I found out you represented that you were the other division, then you lost the deal,” he said.
POA also sells HP and Lexmark, and is Lexmark’s biggest dealer in the U.S. POA is also Konica Minolta’s largest dealer and one of the top Canon dealers in the country. The company is also Pitney Bowes’ largest dealer, a feat accomplished within four years of taking on Pitney Bowes’ mailing machines.
Another promising segment of the business is telephony and VoIP, which are part of POA’s managed IT business segment. Last fall, POA acquired TransWest, a Mitel authorized dealer that sells on-premise telephony. In the three months after the acquisition closed, POA sold $1.3 million in telephony products. POA has been offering IT services for a little more than four years and in 2017, IT, including telephony and VoIP, was responsible for $15 million of the dealership’s revenues.
“It’s moving as fast as I want it to be as what might be happening in the rest of the market,” said Pitassi.
He is satisfied with the numbers in that business segment, but for the company to make further strides in IT, he emphasized during the sales meeting that the company’s IT engineers will have to become the quarterbacks of POA’s future.
A notable initiative is the creation of an internally developed ERP called NOMAD. Six internal developers are working on this project, which is scheduled for a July/August launch.
This diversification and internal innovation fit squarely with the theme of this year’s sales meeting, “Transformation.”
“When it comes to transformation, the constant is the relationship with people and with all of the things you sell,” explained Pitassi. “We have so many opportunities to leverage our relationships to sell more and transform into those other services.”
While POA has an eye to the future, Pitassi emphasized during our interview and at the sales meeting that POA is still committed to print.
“We still want to sell print,” he stated. “I think we can, we have, we’ve proved it, and we will keep proving it.”
Opportunity Still Knocks
The various Oregon branches account for the majority of POA’s business””38.4% or $118 million of POA’s $311 million revenues in 2017. Other markets POA serves include Seattle, Tacoma, Spokane, Phoenix, Tucson, Denver, Salt Lake City, New Mexico, and San Francisco. Expansion is a big part of the plan with markets such as Los Angeles, San Diego, Sacramento, Boise, and Las Vegas as prime targets. Pitassi views California as a land of opportunity. Today, 6% or $20 million of POA’s revenues come from the Bay Area, small numbers relative to the population of the state.
“There’s a huge opportunity to grow in California without an acquisition,” he said.
As luck has had it, POA has grown every year of its existence, even in 2008 and 2009 when many others across the industry did not.
“It might have been by $2, but we grew,” noted Pitassi.
What’s amazing to learn, and maybe not a surprise, considering this is one of the biggest dealers in the country, is that even the revenues of POA’s smallest branches exceed those of many smaller dealers. Simply put, this is a big company. Its warehouse has $28 million in parts, supplies, and equipment. There’s an in-house outsource center where POA does about $1 million a year in free printing for charities because, as Pitassi pointed out, “We can.”
Every business relies on numbers, and as Pitassi shared the revenues of the company’s various business segments prior to the sales meeting with us, he said, “You can see we keep score at POA.”
Saturday at the POA Sales Meeting
The day of the meeting, the lobby bar was teeming well before noon with POA personnel who obviously take Pitassi’s “Work hard, play hard” credo seriously. Once the meeting began at 2, the work hard, play hard ethic was on full display. To a blaring rap music beat, Pitassi emerged from behind the DJ’s box dressed as the rapper “Snoop Doug” and got things started. After transforming himself back into Doug Pitassi, president of POA, he and other POA management reported the past year’s performance of the various branches and business segments and outlined goals for the coming year. Even those that have been underperforming were referenced with a pointed sense of encouragement for improvement.
Meanwhile, the show went on, and the production was lively, original, and particularly irreverent when the company’s top sales performers squared off against each other.
Among POA’s goals for 2018 is to continue with a transformation that is sustainable and can deliver measurable results. That transformation will likely include the acquisition of an IT company in a current POA market and the opening of some new facilities in new and existing markets later this year. All of that takes money, and POA seems to have a little flexibility there.
Although Pitassi described POA as very conservative in its approach to business, he remains optimistic about the company’s future.
“We’re going to grow at our own pace””8% to 9%””and in 2022, we’re going to be a $500 million company.”
“The company is doing well and I don’t need to be here 24/7,” he said. “I have no interest in selling and I am still enjoying the business.”