Canon: Shedding flab to bring in energy

BANGALORE, INDIA: The financial turmoil is taking its toll in terms of business in the IT sector and there is no two ways about it. It began in the mid of last year and the trend is still continuing. Most of the organizations, including the big names are already facing tough times and trying hard to tackle through.

Survival is the core point in these testing times and Darwin's theory of the 'survival of the fittest' very well suits best to the situation.

To be the fittest survivor in these tough times, Canon India, a provider in imaging technologies, has chalked business plan and measures to save costs, which they feel would help them in bringing efficiency without any hindrances.

Alok Bharadwaj, senior vice president, Canon India, said, "We see the current economic turmoil as an opportunity to introspect, innovative and improvise."

Rupee saved is rupee earned

In times of tough economy, every penny saved is a penny earned. Canon is squeezing costs in the areas such as stationary purchase, communications, courier services and travel.

Though these seem to be minimal expenditure, savings from such expenditure could be of help in a broader aspect. The first step is to centralize their stationary purchases from each branch location ordering stationery at the local level to having one preferred partner, leading to consolidation of vendors who supply to Canon.

“Bigger business to fewer vendors would mean getting economies of scale,” said Bharadwaj. The results of having one vendor, Web-based requisitioning and central approval are quite notable, as they were able to save up to 25 per cent in comparison with last year.

The company hopes considerable cost saving even through communication systems. Call monitoring software has been installed on the EPABX systems so that STD numbers are not misused. International calls to group companies are being routed on the existing MPLS bandwidth to save costs.

Apart from general administration expenses, Canon has large spending on marketing. For this, they have re-negotiated all deals with media and agencies and have brought down costs, resulting in 10 per cent savings.

Streamlining travel and connectivity costs

Sales and service staff constitute the largest workforce of the organization and hence Canon is making sure that their sales force spend more time with customer than in office. This has lead to the deployment of virtual working for its sales and service staff.

Video conferencing system has been installed between the corporate office in Gurgaon and parent company in Singapore and is linked to its Bangalore and Mumbai branches.

Bharadwaj added, "We plan to roll out video conferencing systems to all branch offices and encourage employees to make use of it. We are also trimming our travel costs and have tied up with low costs carriers. This would result in saving of 10 per cent of travel expenses."

Going green

Canon has instructed its employees to switch off any lights, fans and ACs when rooms are not occupied. Further CRT monitors are being replaced by TFTs. It has resulted in saving of 15 per cent in power bill over last year.

"Every opportunity of shedding flab is being taken up. This is not only bringing savings but the leanness is bringing in energy too. Like a well oiled machine giving the optimum yield,” reiterated Bharadwaj.

Motivation for productivity



While there has been salary cuts announced by many IT companies, Canon has maintained all staff and given an average increment of 10 per cent. These small steps taken by the company would help them to instill confidence amongst the employees, which in turn would result in enhanced productivity and greater involvement.

The company also organized an annual staff conference, which was held in January 2009 in one of the best resorts in Goa. Bhardwaj feels that such steps help build the employee confidence which helps the company in the present global scenario.