Sharp looks to expand the MFP’s possibilities as it assembles the many building blocks to create tomorrow’s “Smart Office.”
Above: Sharp Corporation complex in Nara
In Nara, Sharp delivered on providing an amazing visit, which turned out to be the most time we spent with any of our hosts during our tour. Our day began at 10:30 a.m. when we were picked up at our hotel by Ayumi Toshinaga, supervisor, global sales and marketing division, office solutions business unit, and ended just after 9 p.m. when we left an Italian restaurant where we dined with our hosts. Overall, it was an illuminating meeting, and we were impressed by the time and effort everyone across the company put into preparing presentations and demonstrations for our visit.
Following a visit at the Sharp museum and lunch at a traditional Japanese okonomiyaki (a pancake-like delicacy made with cabbage and other local ingredients) restaurant with Toshinaga, we arrived at Sharp Corp. headquarters to meet with approximately 15 of the company’s executives, including Fujikazu Nakayama, who leads Sharp’s Business Solutions business unit. Surrounded by so many key executives and another team of employees awaiting us in the demo room, we felt especially honored.
Foxconn on the Run
It’s impossible to meet with Sharp executives here in the U.S. or Japan without referencing the Foxconn connection. Sharp’s new owners loom large over everything Sharp does now, even though Sharp executives in Japan maintain that Foxconn is continuing to allow Sharp Corp. to operate independently. However, the two companies share human resources, have a central purchasing system for procurement, and share R&D and production facilities and expertise. While the relationship offers many positive benefits, without going into specifics or naming names, Sharp executives in Japan were honest in acknowledging that blending the two companies and its cultures has not been without challenges. But let’s be real, challenges are commonplace whenever two separate organizations merge.
Beyond the Traditional MFP
If the company wants to maintain its continued success in developing and marketing business technology, Sharp realizes it can no longer just introduce MFPs with traditional MFP capabilities to replace existing MFPs with traditional MFP capabilities. Most MFP manufacturers align with this mode of thinking, and Sharp’s vision for its nextgeneration MFPs is “MFP+.” This vision represents the evolution of the MFP and is centered around differentiation by adding value and services to the device. Instead of functioning as just another peripheral on a network, Sharp envisions the MFP evolving into a component for web conferencing, workgroup communications, and accessing cloud services, fitting right into the wheelhouse of Sharp’s Smart Office strategy.
We also learned about Sharp’s Network Print Service, a mobile print service that allows registered users to print business documents from anywhere users are located. The IT administrator can then manage print costs by one billing via the office MFP click charge. Think MFP+. The company is currently offering this to businesses in the Japanese market and has 2.3 million registered accounts to date.
Reinventing the Meeting Experience
Sharp product development these days is primarily focused on diversification. As we were told, future solutions don’t have to be related to the MFP business, however, they need to fit the existing channel.
At Sharp’s U.S. dealer meeting in November 2017, we had our first look at a prototype of Smart Office Suite, a solution developed to optimize the meeting room and the office. It was a hot topic of conversation during our visit to Nara as well. Smart Office Suite incorporates an Amazon Echo-like bot with a camera, visual displays, whiteboards, and cloudbased solutions. The goal of Smart Office Suite, which is part of Sharp’s Managed Meeting Services offerings, is to create more efficient and productive meetings via a document management system that allows users to find materials right away and provide support for efficient information sharing. Sharp’s MFPs aren’t an element of this just yet, but that’s in the plan thanks to the MFP+ vision.
In the presentation during our visit, Sharp executives shared results from a survey that identified the many issues (respondents were allowed to identify multiple issues) impacting meeting productivity, primarily at the outset, which Sharp believes Smart Office Suite will alleviate. Among the issues are device connection issues (38%), document management issues (29%), late-arriving meeting participants (17%), attendees discussing other topics (16%), unprepared attendees (12%), audio visual connection issues (11%), lack of familiarity with meeting technology (10%), difficulty with the display and presenting (10%), difficulty with the conference bridge (9%), network connectivity issues (8%), and difficulty finding meeting materials (7%). Sharp expects this research will help the company make a strong case for the Smart Office Suite solution.
There’s no doubt that Smart Office Suite is poised to play a big part of Sharp’s future, and the executives we met with were enthusiastic about it. Although Sharp isn’t the only OEM talking about optimizing meeting rooms””Ricoh is too””once this rolls out this fall in the U.S., it will offer a strong point of differentiation for the company and its dealers. The challenge is preparing dealers to sell something very different from what they’ve been selling, as well as taking the product on in the first place. We do know that Sharp Imaging and Information Company of America (SIICA) here in the U.S. has been diligently engaged in preparing materials and programs to help their dealers sell this product.
An Ambitious Goal
One of the boldest comments we heard from Sharp executives in Nara was that the company is aiming to become one of the top three A3 MFP suppliers in terms of market share. That’s a lofty goal, and the company has a few hurdles to leap, especially since its current market share is in the single digits, whereas the current top three””Canon, Ricoh, Konica Minolta””are in the mid- to high-teens. The plan is to grow its market share from just over 5% to approximately 15% by 2020. Achieving that goal means Sharp must take market share away from each of the top three, while also fending off an aggressive new competitor in HP.
Toward that end, Sharp and Foxconn are developing new A3 products, adding dealers and expanding distribution channels in the U.S. and Europe. As we were told, low-end color and low-end black & white (B&W) are key to growth in the A3 market, as well as to finding new customers and adding value to take business away from competitors.
Outside its ambitious growth plans in the A3 space, the company’s product roadmap includes a series of new A4 products and solutions, as well as plans to introduce a low-speed product by 2020. This year, we’ll see A4 low-end machines introduced in China and the U.S., and in 2019, low-end A3 color and low-end A3 B&W machines.
In the office technology space, the plan is to continue to upgrade its existing product line. Sharp and/or Foxconn don’t seem to be interested in pursuing the production segment beyond where they are now with their light production machines. It’s our assumption Foxconn isn’t interested in production because there isn’t a sufficient ROI to warrant entering that space. That’s okay, because even though we feel production offers a huge opportunity for dealers as print in the office declines, it’s still not for everybody. But everybody does need to be thinking beyond the MFP, and that’s what Sharp is doing and dealers here in the U.S. should be in a better position because of it.
Be aware that Sharp has some bold mid-term worldwide sales targets for its business systems (BS) business unit, the segment of the company responsible for everything we saw and heard about during our Japan meeting. After growing 108% in fiscal year 2017, the BS business unit is looking to grow 121% in FY 2018, 113% in FY 2019, and 111% in FY 2020. This growth will encompass all key business segments, including business products, visual solutions, system solutions, and manufacturing solutions. Office solutions represent the biggest segment for growth.
Bring on the Showroom
Our visit to Sharp’s showroom for product demos offered a look at highspeed and mid-range MFPs and A4 products, as well as digital signage and smartboards. Sharp believes the market for public displays will continue to grow and expand worldwide, with retail signage representing a huge opportunity. AQUOS BOARDs, particularly in offices and vertical markets such as education, are another product segment where the company anticipates strong growth.
Two new display products we saw were the Interactive White Board PNL501C/401C””one with a 50-inch and the other with a 40-inch touchscreen””ideal for what Sharp called “huddle space” meetings in smaller areas for two to six people. These devices possess what Sharp calls intuitive touch operation with sensitive pen operation with the pen allowing for fine writing of small letters and drawings. What we saw in Japan on the display front validates much of what we’ve heard here in the U.S. and underscores Sharp’s position as a leading provider of display technology. Sharp is also making inroads in 8K display technology, and we expect to hear more about that in the future. The 8K display we saw at Sharp’s dealer meeting last fall impressed us. The images were amazingly crisp and clear, almost like looking through a window at a live scene rather than viewing a video on a screen. This may not be something that’s a fit for the dealer channel right now, but when it comes to technological advancements, nothing is ever off the table if you’re a dealer in the imaging industry, particularly if you’re already selling Sharp display technology and flirting with Smart Office Suite. It’s not unrealistic to assume that 8K technology will be integrated into future Sharp product offerings.
A Company with a Promising Future
We left Nara hugely impressed by everything we heard and saw during our Sharp visit. We expect the deep pockets of Foxconn and its access to new technologies will continue to take Sharp into new and exciting directions. Sharp is thinking big and broad and is looking to change offices and cities (yes, they’ve got a vision for that too) in its efforts to establish the company as a total solutions provider across the globe, not solely in Japan or the U.S., which represents the largest market for its products. It’s all about smart offices, smart homes, smart factories, smart services, and a cloud services membership services platform. With all that on the table as well as in the R&D pipeline, we believe what we learned in Nara is really only scratching the surface of where Sharp is heading as a global technology provider and driver of change.
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