Kurt Schmelz was appointed president of the newly formed U.S. Channel Group (USCG) within Xerox’s Channel Partner Operations in January. We sat down with him to learn exactly what that means, where he came from, and where he and the USCG are headed.
The U.S Channel Group is new to Xerox and Kurt, you’re new to the U.S. Channel Group. What is the background on both of those things?
USCG was created out of two separate channel organizations, the North American Agent Operations (our branded partner organization)and the U.S. Solutions Providers (our multi-branded partner organization), which I headed prior to the merger.
Bringing the two organizations together as one partner-facing channel organization makes it easier for our partners to do business with Xerox. It also allows us to increase our investment in critical areas of growth, such as managed print and focus on what’s most important to our partners.
How have you converged the two organizations – what does the USCG look like now?
The merger allows us to become one partner-facing organization for what were previously two separate channels.
Where do you see the MPS market right now? Is it still a viable market, a growing market? How are you coping with some of the changes in the channel?
We definitely see MPS as a continuing, growing market. We know that more than 80 percent of end-user decision makers prefer to work with a single provider for IT managed services and managed print services – that’s had a big impact on the business.
With more providers entering the MPS space there’s more choices, which puts pressure on partner margins. But, end users are also looking for higher-level offerings. We believe the partners that are going to succeed as MPS providers need to offer additional print-related services, as well as advanced offerings, such as workflow, document management and vertical-specific applications. That fits in well with our managed print portfolio. We have offerings from entry level to advanced services.
What do you think the successful dealer looks like in 2015, and what might the successful dealer look like in 2020?
The successful dealer, from the MPS perspective, will provide a higher level of services. The price of admission is to be able to reduce costs, but it has to go beyond price, such as offering IT managed services as well.
Are you seeing more convergence between imaging and IT, or do you see a barrier to adaptation there?
We are seeing convergence; many are IT partners that moved into the MPS business, and other traditional print-oriented, document technology-oriented partners are either acquiring IT managed services type partners, or starting their own businesses.
What is the greatest challenge you face today?
Our biggest short term challenge – which is more of an opportunity – is providing more pre-and post-sale support for our partners. We are also continuing to evolve our portfolio from a MPS and print perspective.
Why do you hold your current position today?
My career includes sales management experience at IBM and GE Capital IT solutions. From there, I went to Global Imaging, which is a subsidiary of Xerox, where I utilized IT solutions and learned the document technology business. That experience was instrumental in being asked to lead the U.S. Solutions Provider group.
As a customer of the U.S. Solutions Provider group, I have that perspective to understand how partners think and what motivates them, and we’ve been able to implement that in our strategy.
Do you think the paperless office will ever happen?
That’s not what our customers or end-users are saying. I know I’m not paperless and I’m a pretty efficient guy who loves technology. I’ve been in IT my entire career and I can’t get by in a paperless way.
I think that certainly people born after 1992 are probably utilizing technology differently, using tablets and apps in ways that some older people would use paper-based solutions. But, I don’t think that’s having a tremendous impact on pages printed in a business environment, which is primarily where we focus.
What do you see as your biggest opportunity?
The growth of managed print and the potential for providing our partners with a recurring revenue model as they go forward. If you look at the industry, whether it’s the document technology industry or the IT industry, it was really built on selling products to customers and achieving a good enough margin with the sale of the products to have a sustainable business.
As certain products have become commoditized on the lower end, as margins have shrunk, as business has become more competitive, our partners are looking for real, robust, added value solutions to differentiate themselves from their competition. I see tremendous growth for our partners.
What qualities do you look for when you’re making new hires?
I’m more interested in someone’s character, not necessarily specific experience in the industry. For example, competitive backgrounds catch my attention as it tells me this person has a really strong desire to win. Core intelligence is also important – someone who can sort ideas and concepts and take processes they’re taught, and execute them.
What do you consider your greatest achievement?
Staying married for 26 years! Aside from that, I don’t think a lot about that; I just try to do the best I can every day, whether it’s as a husband or father or an employee of an organization. The achievements kind of take care of themselves – if you’re working hard at being the best you can be at all of those things.
Where will you be investing most within your division this year?
There are a few key areas, managed print, of course. We will look to broaden and improve our portfolio of offerings from entry-level through mid-level, as well as advanced level of services.
We will also invest in our partner-led managed print offerings. We’re putting a great deal of time and capital into our partner relationship management tools, such as our new global partner program. Those are key – from a corporate level, the company continues to invest into its portfolio of products from production to entry-level technology.
Do you think that trends exist in this industry?
Less and less. As technology continues to change so quickly and end-user adoption rates are happening much faster, it’s harder for trends to exist due to the rapid nature of the industry.
How would your employees and coworkers describe you?
I think they would describe me as a fair, collaborative person and a strong leader who leads by example. I’m always looking for our employees’ input on how to do things better and I always give credit where it belongs.
What words or phrases do you most overuse?
There’s really one only word and that is growth. The majority of conversations with partners or my team include growth: “What are we doing to grow; How are we going to grow; Will this lead to partner growth if we do these things?”
Who are your favorite writers?
I’m a big reader. I’ve read every Ernest Hemingway book. Most I’ve loved, some I haven’t. I wish Salinger had written more.
On the web: Xerox
This article originally appeared in the April 2015 issue of The Imaging Channel
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