"We are driving at digital convergence"

The IPG business–often called the jewel in HP’s crown–has seen a 12%

year-on-year sales growth in the fourth quarter to $5.3 billion, with profits

jumping by a whopping 89%. "Maintaining this two-digit growth is my biggest

challenge," he says.

He also dispels partners’ apprehensions caused by the recent announcement

that HP will increase its focus on direct business–part of the massive retail

push that HP has embarked on in India. The man behind HP’s IPG business

worldwide is clear that this ‘partner-centric focus’ will be the key to

success. "IPG gets 97% of its business from partners. Only partners can

provide us the scale and reach..."

Vyomesh Joshi executive V-P, Imaging and Printing Group, HP

 Often

described as the jewel in HP’s crown, the IPG division accounts for 40% of HP’s

revenues and 60% of profits. What are the challenges involved in heading such a

‘star’ division?



...Innovation, constant development and leadership through better

products and relationships. And the need to stay ahead and surpass the growth

that we have seen in recent times–Q4 sales are up 12% to $5.3 billion and

profits jumped by a whopping 89%.

And digital–trillions of pages are printed worldwide, everyday. The

greatest challenges in any form of information sharing are four-pronged:

creation of content, quality, delivery and distribution. And I feel that the one

aspect that will change the way information is processed and disseminated will

be digital. Digital is the key. Just as it happened to the music industry, the

entire publishing industry will also go digital. If you look at the silver

halide (photography) space, that too is going digital. Digital is the key and we

are working hard on this.

 In

September, you acquired Indigo for $882 million. What is the long-term strategy

on this front?



Clearly, the idea is to take printing and imaging and turn it from a

simple "box business" into more of a solutions, consulting and

services-based business. Indigo’s technology for digital-based commercial

color printing is the only one of its kind in terms of delivering top-quality

digital color printing at high speeds–and with a reasonable cost of ownership.

And look at the other giant that’s been left untouched–commercial printing

(that’s magazines, newspapers, marketing materials etc)–that’s a

$400-billion industry worldwide, and 96% of that still work on traditional

Heidelberg printing methodologies. Even if we target some very modest numbers

here, we are talking opportunities greater than most would imagine. We hope to

work with these printers and provide them with Indigo presses and digital

printing infrastructure to handle big digital jobs.

Digital

is the key, you say, but it cannot hope to compete on the pricing front, as

against traditional methods of printing. Also, you have been following the CRM

footprint, targeting the customized, specialized printing space...



We have the expertise to work with companies developing CRM

systems... And build gateways where we can take the CRM information and the

content creation and do personalized customized marketing collateral. Many

companies take weeks to get marketing collateral organized at the moment... we

feel we can bring that down to a matter of hours.

And that’s where the merger with Compaq becomes critical–the need for

consultants and a services organization to execute on the sales and solutions

implementation strategy is key here, the joint entity has a much stronger

services presence. Add to this the IPG services organization that we have in the

pipeline, and we have a good thing going here.

We need to make our content transformation capabilities real. And we have a

huge amount of work ahead–to move from boxes to solutions. The benefit of

digital would become clearer when the added plus of customization enters the

picture.

As for the digital drive and where we are headed, I see four areas that will

really drive growth and expansion–imaging, digital publishing, copiers and

mobility. It is not an easy nut to crack–we never said it would be–but we

have the processed in place and are working with a clear strategy towards the

objectives we have set out.

 What

are the immediate goals for the division?



We want to increase marketshare dramatically in the coming days when

the entire printing process becomes digital. The acquisition of Indigo was in

this direction. The digital convergence that we are driving at the high end of

the imaging and printing markets will bring in big gains in the near future. It

takes seven years to build a billion-dollar business...

Rajeev Narayan