TBY talks to Burak Özer, General Manager of Xerox Türkiye, on the company's position in Turkey and the strive to develop new services.

How is Xerox's position in Turkey supporting its business development in the emerging economy?

Xerox is well positioned in Turkey, and 2015 will be the 25th anniversary of our presence here. Xerox was one of the first companies in this sector to base itself in Turkey, and recently our competitors have also entered the market, mostly through purchasing their distributors and partners, which is the strategy that we used to enter Turkey. Throughout these 25 years we have invested heavily, particularly on the channel and partner development side. Xerox has one of the most effective partner networks in the country. We also have a service company that offers significant career opportunities to locals, and together with our partners we have a network of some 1,000 employees around the country. These positions could be sales-based, service-based, or operations; we also give management print services, and we are the leader in the sector for management services. Xerox makes an important contribution to the labor market of Turkey, and by paying taxes we are contributing to the Turkish economy. There are no manufacturing facilities in Turkey at this stage, although the possibility is under consideration. Xerox is changing from a technology-orientated company to a service-orientated one. While there is a demand in the technology industry, there is even more demand for infrastructure and business process outsourcing, in which we want to be a major player.

What is Xerox doing to combat the informal economy?

Xerox plays an important role in this campaign by working to eliminate counterfeit products, which is well documented in the press. Xerox is also working with Interpol and the Turkish police, although this involvement is minimal on our part. Our primary focus is on our day-to-day business, on investment in the area of security and recruitment. Otherwise, we have price harmonization policies across the world; under this agreement, prices are similar across all countries and territories. These prices are audited heavily; in fact, I used to be part of this auditing process. This facilitates the free movement of goods with price differences. This challenge is not unique to Turkey.

How do you strike a balance between offering low costs and developing R&D and new technologies?

Xerox has been very successful, both at a country level in developing markets, and at an organizational level in terms of controlling costs. In the Central Eastern region, we have reduced our cost base by 30%-40% over the five years I have been at the helm. Our strategy is to reduce inefficiency to the lowest possible level, and we accomplish this through effective reporting, which allows us to measure our progress. Xerox is very good in terms of having data available for control and measurement, which promotes increased efficiency, and allows us to invest wisely in the market. This is important because the market is very cost sensitive, and the operation of high-end printers is even more cost sensitive. As I said, Xerox is a very good vendor, because we offer products from the smallest to the largest size, and that is an advantage because we can shuffle between products and invest in the business. However, sometimes Xerox can find itself at a disadvantage when its competitors are focused on one product, and we are focused on the whole range of products.

“Printed electronics is the revolutionary technology to produce electronic circuits on the surface of different materials."

Xerox is best known for its copiers and printers. Would you say that the company's strategy is shifting away from manufacturing these products and focusing on services?

Rather than ceding its advantage in technology, the current strategy is a form of diversification. But with technological developments, the market has limited overall growth potential in the near future, although there are still growth opportunities, especially with print houses. For example, print houses are migrating toward digital printing. This means that Xerox, and vendors like us who are in digital printing, are hoping to grab a share of this action. However, traditional printers and copiers are a limited area of growth and, therefore, to satisfy our shareholders, Xerox has added the services business to its portfolio, which offers a more rapid growth rate and has more growth potential in the future. Therefore, it is not our intention to abandon our traditional strengths, and we have every intention of maintaining our market leadership.

Are there other technological opportunities that Xerox is currently reviewing, such as 3D printers?

Xerox is not particularly interested in producing 3D printing devices. Printed electronics is something that Xerox is interested in and well positioned itself to capitalize on this trend. Printed electronics is the revolutionary technology to produce electronic circuits on the surface of different materials such as plastic, silicone, glass, and textiles. However, nothing has been officially highlighted at this stage, especially in printed electronics, which is something that could be an incredible opportunity not only for Xerox, but for all industrial production processes in general.

Are there digital products or services that Xerox works with that have growth potential in the Turkish market?

Xerox is definitely the leader in the printer market, but in terms of the inkjet market we are new. In light of this, we recently acquired Impika, a company in France. Impika is the market leader in inkjet printing and represents a major opportunity for Xerox, both in Turkey and globally. This is especially the case in digital printing, as these machines are capable of printing millions of prints in a very efficient manner, which is what makes these inkjet machines so exciting.

How do you see the ICT sector in Turkey developing moving forward?

ICT is a fast-growing market, but it is consumer oriented, rather than technological. In other words, ICT is developing in terms of consumer needs rather than in terms of infrastructure and technology. This needs to change in favor of more technology investments by both companies and the government, which has picked up the pace over the last five years. The consumer-orientated market is changing, but it threatens to eclipse the technological developments on the corporate and state level. Regardless, being able to sell value is something that will remain critical in Turkey, which is something that Xerox knows how to do best.

© The Business Year - November 2014