Commentary & Analysis
FREE: Agfa’s Saggiomo Speaks Out at Graph Expo
By Cary Sherburne,
By WhatTheyThink Staff
Published: November 3, 2004
By Cary Sherburne, Senior Editor November 3, 2004 -- Just a few weeks into his new role as Agfa’s president, Graphic Systems, North America, industry veteran Tom Saggiomo is nothing if not optimistic. He seems to be attacking his new challenges with ease and has a clear vision about where Agfa is today—and where he wants to take the North American operation. Read all about it in this exclusive Graph Expo WhatTheyThink executive interview. WTT: Tom, thank you for taking the time to speak to us in the midst of a busy Graph Expo. And congratulations on your recent appointment! TS: Thank you. I am excited about the opportunities we have ahead of us, and this has been an exciting Graph Expo. WTT: Like many companies in our industry, Agfa has been undergoing many changes, organizational as well as strategic. Can you bring our readers up to date on Agfa’s current strategic vision and where you see the company going near-term and long-term? TS: My first observation after joining the company was that Agfa is rich—and I am not talking about just revenues, though Agfa has an immense graphic arts turnover of approximately $2 billion globally. What I have found is that Agfa has a tremendous richness in technology. We have more than 10,000 intellectual property positions (patents) and we have tremendous customer acceptance reflected by more than 30,000 prepress installations around the world. The vision you see us expressing at Graph Expo around “Taking Command of The Graphic Enterprise” is not a new theme, but it is the right answer for today’smarket. Customers do not need siloed solutions; they need a continuum. You will hear more about this theme from us as we move into the future. The days of doing an individual or discrete task within a production operation and simply tossing it over the wall to the next department, hoping for the best, are gone. We plan to continue to enhance our solution set so customers can continue to turn to Agfa for that continuum of evolving solutions. WTT: KPG has been aggressively adding digital printing equipment. Agfa once had Chromapress and abandoned it. Is now the time to get back into digital printing? TS: Agfa is involved with digital printing. We chose to pursue this important segment through our acquisition of Dotrix, a pioneer in inkjet digital printing. We think there is a huge opportunity for inkjet going forward. We believe that it is an extremely viable and competitive form of digital printing that will displace some level of offset in the marketplace. WTT: Now that Agfa’s equipment production is totally overseas (closing Wilmington, MA), what does that mean in terms of service, parts, and reaction time to US customers? TS: Well, first of all, many of our platesetters are manufactured here in the U.S.A., including the :Xcalibur platesetter families at our Wilmington facility. We have outsourced some of our equipment production to a range of partners that can offer complementary manufacturing for us. We have worked hard to gain a good understanding of our core competencies, and we have sought a range of partners to augment those core competencies. We also have a robust infrastructure in North America that is delivering high quality service to our customer base. So as a result, our customers will continue to see excellent response times, in terms of customer support, field technician support and the parts they may require. WTT: Where do you see the industry headed in terms of greater concentration of buying power among big printers? TS: We believe in a free market. Economics drive the marketplace, and to the extent that the market sees fit to consolidate, the consolidation will continue. This applies to both printers and their suppliers. WTT: As a global player, what does Agfa see in terms of worldwide trends for print, and with Agfa's activities in China, does that undermine some of the printers in the U.S. who are threatened by offshore printing? TS: Again, Agfa is a strong believer in a free market, and that applies globally. There is a global economy and China is a reality we must face. There is competition coming from China, make no mistake about that. We have invested in China, as you know, and have commissioned a facility in Wuxi, where we have a new litho plate plant. We are going to use that plant to supply a very robust market in Asia. At this point, we are not looking to take product produced in China and move it to North America. Regarding the competition coming from China in terms of the production of printed product, I say “Bring it on!” Printers need to offer value to their customers, and it is more than putting ink on paper. Those U.S. buyers who are purchasing print offshore from China are primarily making a price decision. As a printer, if you live simply by how low you can get your price, you will have difficulty prospering, whether China is in the picture or not. If you reduce your cost by a penny, it won’t be long before the guy down the street reduces his by two. Printers do need to focus on how fast but the real question is what can they deliver and what added value they can offer beyond ink on paper. That’s what really matters and differentiates them. WTT: What is Agfa’s current sales structure? Is there anything new on the channel front? How committed is Agfa to its dealer organization, especially since some of your competitors are now selling to large customers directly TS: We are taking a look at both worlds, dealer and direct. With the addition of Lastra, we already have a hybrid channel. Lastra had two discrete channels. The commercial business was fundamentally distribution, but we had a significant piece of business on the newspaper side and in the book market that we serve direct. That will continue, so as we put both companies together, we will have a hybrid model. Having said that, make no mistake that we are committed to our distribution channel. WTT: You mentioned your Graph Expo theme of “Taking Command of The Graphic Enterprise.” What do you mean by that? TS: Customers need tolook at the entire supply chain and they need to look at non-value-added inefficiencies in their operations and automate them through process reengineering. This more efficient operation leads to a stronger working relationship with customers, which in turn creates branding power and tighter customer relationships. Printers that achieve these tighter customer relationships become an integral part of the customer’s organization and planning process, and achieve significant brand loyalty. WTT: So your “Take Command of The Graphic Enterprise” theme for Graph Expo reflects that philosophy. Can you share with our readers how you are getting that message across here at Graph Expo? TS: First of all, we do have a great presence here at Graph Expo. In fact, we have renamed one of the aisles “Agfa Avenue,” with Agfa’s booth as the anchor, the Lastra booth a little farther down, and our presence in both the Wide Format and JDF Pavilions. But instead of talking about Agfa taking command at this show, our message is that we want our customers to take command. We want them to be able to see how our Graphic Enterprise Software Suite of :Delano, :ApogeeX and :Arcadia can help them take command of their business operations. Profitable printers are transitioning from being “just printers” to being services companies, and they are adding cross-media services. The way they can successfully add these services is to look at their business as The Graphic Enterprise. The cornerstone of The Graphic Enterprise is :Delano, our project and resource management enterprise software solution. This is the starting point customers are using in order to gain better control of costs and to streamline operations between order management and prepress. :ApogeeX includes enhanced JDF features and more automation. :Arcadia is more than digital asset management. It is a dynamic publishing system tuned to serving the needs of the industry. It is based on a platform we exclusively OEM from INSCI for the graphic arts industry. These three products form our Graphic Enterprise software suite. The second area of opportunity is CtP. Here at the show, we are featuring :Azura, our chemistry-free CtP plate. We now have three types of CtP: visible light, thermal and chemistry-free. Chemistry-free has really been the Holy Grail of CtP and :Azura employs ThermoFuse technology Our updated portfolio with the addition of Lastra now firmly places Agfa in the number one position in the world in printing plates. The third area in which we are investing heavily is inkjet. A new product we are showing here is the :Grand SherpaMatic. It is the only automated two-sided contract quality proofer out there and can produce an eight-up proof in less than five minutes. And, of course, we have the Dotrix solutions I talked about earlier. You will hear a lot more from Agfa in the future relative to inkjet and digital printing. Agfa is working hard to make sure print stays in the communications mix. And we are working hard to ensure that our customers can truly take command of their Graphic Enterprise. WTT: There has been lots of talk, of course, about CIP4 and JDF, and Agfa has been a key player in the development and deployment of the standard. Can you talk about how you see JDF actually playing out in the world of customers? Are customers asking for this? How educated overall do you think they are, and when will we reach critical mass on adoption? TS: This goes back to the concept of The Graphic Enterprise. Simply being responsible for one portion of the workflow just won't work any longer. Printers should be looking for partners that can provide the continuum of services and solutions they require. There should be “no place to hide, no one to blame” with the solutions that printers are implementing these days. They need a single point of contact that can resolve issues for them quickly and efficiently. With respect to JDF, our position is that not everyone is ready yet to adopt a JDF-enabled workflow, but we believe that JDF will, in fact, become prevalent. Our advice to our customers is this: Whatever you buy, make sure it is JDF-enabled. Then when the time is right for you to JDF-enable your workflow, you are already on the right path and have made investments that will fit in with that ultimate end point vision. We strongly believe that by next drupa, JDF will be prevalent in the industry. What we are seeing at Graph Expo is that the curiosity level is high. Customers appreciate basic information on what JDF really is; they all know to ask, but many are just educating themselves at this point. WTT: Acquiring industry expert Bill Lavelle was quite a coup; talk to me a little about how you see him augmenting your organization. Does this mean that Agfa will become a proponent of Activity Based Costing? What vehicle will you use for deploying his assessment tools, etc.? TS: Given what we are faced with in terms of industry challenges, it really is the appropriate time for printers to evaluate all of their processes—not just manufacturing, but the front office and those processes during which they interact with their customers. What we are really talking about here is a re-evaluation of the entire business model and the way printers do business. Bill is developing a Business and Production Needs Assessment which is a consultative process that will help companies identify their goals, understand their current state, and build a roadmap to the desired state. Once you define these elements, it is a matter of what equipment and software you need to fulfill your strategies. Activity Based Costing may be an element of that for some customers. Bill is part of our Agfa team of consultants offering an expanded range of Expert Services, including Bill’s area of expertise on Enterprise Consulting and :Delano solutions. WTT: What trends do you see in the packaging market? What is your advice to printers relative to adding packaging to their solutions mix? TS: Packaging presents a very important opportunity. The three business segments Agfa focuses ion are commercial printing, packaging and newspapers. Within those three segments, there are sub-segments, of course. In the packaging world, there are pure packaging companies and there are hybrid commercial printers that use packaging work as an adjunct to commercial work. There is no question that packaging is a growth segment and much of the equipment in a commercial operation used to produce traditional materials like brochures, can also produce labels and other packaging materials. Dotrix plays a role here, too. We are currently focusing the Dotrix solutions on the packaging segment. I would encourage commercial printers to explore options that will add value for their customers, including packaging. They should not get caught in the spiral of, “I can do it for a penny less.” There will always be someone who will do it for two pennies less. Wide format printing, packaging, point of purchase—these are a few added value areas printers should be exploring. WTT: From your vantage point of a few weeks in your new role, what comments do you have on how you want to see Agfa North America operate as a company? TS: I have found that if one applies four basic rules, an organization can operate very effectively. The first rule is Courage; that is number one and my favorite. Many times things in business, or life in general, are not as pleasant as one would like. If we face these things with courage, life gets easier. We encourage our employees to let us know if they see something we can do better—we want to hear about it. Politely, professionally, but we want to hear about it. The second rule is Teamwork. We win as a team or we don't win at all. I do not want one department to win on the back of another department. That is not really winning. The third rule is Doing Good Work, which is my code for quality. Everything that we do needs to be done at the highest level of quality, whether it is in the way we interact with customers, develop and build our products, or conduct research. The fourth rule is Safety. I never want anyone to come to work and get hurt. These four rules can be applied to your personal life, as well as your work life; they are good rules and we want to instill them into the organization from top to bottom. WTT: What do you like best about your new role? TS: From a five-week view, as I indicated, I think the richness in technology at Agfa is incredible. I have competed with Agfa for a number of years, and now after five weeks inside, my view is that there is a very rich technology base, and there are incredibly dedicated people that work very hard. My goal is to provide leadership for the group to help us do even better for our customers. WTT: What do you like least? TS: Besides the food in the cafeteria? I would have to say what I like least is that I don't have enough time with my family. The experience has been incredibly intense—enjoyable, but intense. Up to this point I have been internally focused, but I have also had some very good meetings with customers, and here at Graph Expo, it has been wall-to-wall customers! I am looking forward to more of that customer interaction as we switch my focus away from the internal activities. For more information, please visit www.agfa.com Search the industry's largest archive for agfa.