Lexmark CEO: We Are Looking To Build A Software Channel


Paul Rooke became Lexmark's president and CEO last year following the retirement of longtime leader Paul Curlander, and it's Rooke who's charged with growing Lexmark and its legacy printing and imaging businesses in a customer environment transformed by cloud computing and a greater appetite for business process and enterprise content management solutions.

Rooke, who has been with Lexmark since its formation in 1991, joined CRN Senior Editor Chad Berndtson this week in New York for a discussion of Lexmark's channel investment, its value proposition compared to bigger competitors like Xerox and HP, and how its acquisitions of Perceptive Software last year and Pallas Athena this fall align with its growth strategy. Here are excerpts from the conversation:

What we're seeing among Lexmark and your competitors is this move away from the legacy hardware-oriented printing and imaging-type definition of the business and more toward variations on business process management, outsourcing, managed services and other things that help you offer more customer value. Where is Lexmark on that journey?

I would not characterize it as moving away from hardware; I would characterize it as "adding-to." We're continuing to invest in our core imaging business, both mono and color, but what you're seeing us doing, particularly with the strength of our smart MFP, is adding design intelligence. What people have overlooked with the business of imaging hardware and the maintenance of those fleets is that if they look at it just as a fleet of copiers, they lose the value of looking at imaging infrastructure the way they would server infrastructure or PC infrastructure. You put in the right device and it opens up the other part of the iceberg, which is business process improvement. We're trying to make hardware more intelligent to facilitate an easier connection between the paper world and the digital world.

Your major competitors have made the leap in different ways; for example, Xerox is focusing on business process outsourcing with its ACS acquisition. Can you lay out Lexmark's value proposition to customers against competitors like Xerox and HP?

They have and they haven't. And unlike Xerox and HP and others in the hardware business, we own our technologies, as opposed to source our technologies. We can control things within the hardware in terms of instrumenting it or making it more intelligent, which gives us a big advantage. We do see them moving into more outsourcing and services, not necessarily business process technology. The way to think about it is we're adding to our toolbucket of technologies, as you've seen with business process management and enterprise content management, to help customers become more efficient. We're not in there asking them to outsource their business to us. We think we can add far more value by being the provider for them of combinations of solutions, as opposed to just outsourcing.

Many legacy printing and imaging resellers are trying to evolve their own businesses now. What are their biggest opportunities behind Lexmark?

At Lexmark, we move the vast majority of our products through the channel. The channel is very important to us -- it has been, is, and will continue to be. As we're evolving, we're looking to add to our channel partner set. Historically, it's been a lot of hardware partners, but with these more sophisticated solutions, we are looking to build a software channel with folks that can integrate and put them in. If they're out there, come see us. We're looking for folks who can help us. The channel is very much an important part of our future.

NEXT: Lexmark's Acquisitions, Channel Investment