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Kodak Alaris CEO eyes future

Rochester Business Journal
April 11, 2014

The No. 1 task facing the new CEO of Kodak Alaris is choosing which opportunities to focus on—and, just as critical, which ones not to pursue.

“The biggest challenge is to decide upon our priorities,” said Ralf Gerbershagen, who became CEO of Kodak Alaris Holdings Ltd. on April 1 and spent much of the past week in Rochester. “There are so many things we can do—and I told this to the team yesterday. The challenge is to decide on what we’re not going to do, because there is an overwhelming amount of opportunities here.”

Added Gerbershagen: “I think we have to pick our best. We have to be very careful how we utilize our resources; we have to do what we can to scale this business up.”

On Sept. 3, the U.K. Kodak Pension Plan acquired the Kodak Document Imaging and Personalized Imaging businesses from Eastman Kodak Co. and created Kodak Alaris.

“Our charter is to develop this business into the future,” Gerbershagen said in an interview with the Rochester Business Journal during his trip here.

During the interview he discussed the role Rochester will play for Kodak Alaris, his plans for growth and the biggest surprises so far.

Gerbershagen joined Kodak Alaris—which he calls a billion-dollar startup—from Motorola Mobility, now part of Google Inc. He is based in the United Kingdom.

The company, which launched with $1.3 billion in annual revenues, employs some 700 workers in Rochester and more than 4,700 worldwide.

“Rochester is the lifeline of the business,” he said. “The charter of Rochester is to support the teams (worldwide). We have strong R&D teams here. They have great ideas. We need to develop ... and feed the teams these ideas.

“Part of the management team is here in Rochester,” he added. “I don’t see any changes at the moment. And the facility here is clearly to support our expansion plan on the go-to-market side.”

Gerbershagen sees ownership by the pension plan as a tremendous benefit for himself as CEO and for Kodak Alaris. The pension plan, he said, takes a long-term view of the company.

“For me it is a perfect situation,” he said.

Gerbershagen’s visit to Rochester included a Kodak Alaris town meeting on Tuesday as well as additional sessions with management, staff and others. He spent last week in Brazil and next week travels to Europe.

At Motorola Mobility, Gerbershagen’s leadership positions included managing director of Motorola Germany GmbH and vice president and general manager of Motorola Mobility Europe.

Steven Ross, then interim chairman of Kodak Alaris, described Gerbershagen in February as a recognized leader in both established and growth businesses, who brings “an unparalleled commitment to innovation, change and customer needs in the dynamic mobile industry.”

An edited transcript of Gerbershagen’s interview with the RBJ follows.

ROCHESTER BUSINESS JOURNAL: You held a Kodak Alaris town meeting yesterday (April 8). What was the key message you wanted to get across, and how do you think that went?

RALF GERBERSHAGEN: I think that went very well. Yesterday was day seven of my journey into Kodak Alaris. And it was day two with the team. I started last Tuesday, first day with the company, in Brazil. We had a board meeting there. We saw customers. We got together with the teams in Brazil. Came in Friday morning to Rochester.

Important in the town hall for me was to connect with people. There is always a concern when a new CEO comes in; they say, “Hey, what are you going to do; who (are) you?”—specifically, if a German guy with such a long name comes in. So we had a great town hall (meeting). We went through a lot of personal stuff. I introduced myself to a lot of people.

My primary role, I think, is a couple of things—firstly to secure the future of the company under the new ownership of KPP from Europe. So it’s quite a bit of change for people. On the other side, I told them, “I’m here to support you.”

The last element is this is a journey for us together. We will build the future of Kodak Alaris between me and them and them and me, because they are the experts. They know how to run this business. My job is to unleash the potential of people in the company, to drive it forward with them.

Growth plans
RBJ: You have described long-term growth as one of your passions. What do you see as the potential for the company in terms of growth, and how do you achieve that?

GERBERSHAGEN: We have two divisions today. We have Document Imaging and Personalized Imaging. When you look at the Document Imaging side, there is a tremendous opportunity because we are mainly focused on hardware and related software today, and on the document capture side. And we have a software, which is called Info Insight, and the software basically allows us to develop from the entry point of the information data in any corporation or any large or midsize enterprise to basically expand from data capture to document management throughout the entire operation.

On top of this, the software has a lot of intelligence capabilities, which allows us to read the content of the documentation, which then takes us, as a next step, from document management, ultimately, to content management.

So here we are, (with a) very strong position on the scanner side, managing the entry points on the information flow in the company. We’ll start managing documents to have the ability to read the content on the documents and can almost start managing the knowledge. We can basically interact the intelligence we have about the documents and the content: Where do they need to go? What business case it is. That is one of the growth areas. This is just an emerging market. I think we are ahead of the game here. It is almost like we are going to create this market in the future. I believe we have a very strong asset with the software. It is really a competitive edge.

On the (Personalized Imaging) side, we have a strong base of these kiosks out there. We have strong retail partners out there in the world. I do not necessarily believe that the decline of print is going to impact us, because the market is still big enough to expand in this area. And we are doing this by supporting our strong retail partners. Specifically in Germany we have two strong companies, DM and Rossmann. They really believe in the photo category, and they drive this as one of their major revenue streams of the company. It is a great asset we have.

And then we are looking into three areas to expand: (First,) into mobile; how can we connect what we have into the mobile industry? We have just launched a new app (for iPad), the Kodak Moments HD App. We are looking at how we can really scale this up to, say, the Android store or mobile phone manufacturers. …

The second element we are looking at is online. What capabilities do we have to leverage the Internet stronger in markets where the kiosk business and strong retail outlets are not there?

The third element is what are we going to do with social networks. First of all, there are millions and millions and millions of pictures buried in social networks somewhere. Second, one of the biggest assets … we have in the company is when you enter #kodakmoment into the Internet. It is unbelievable how many people store their memories, their emotions under this hashtag. It means they relate to us as a company and relate to the Kodak brand. We are looking into how we can leverage this better.

RBJ: How does ownership by and goals of the pension plan—compared with, say, public ownership or private equity ownership—match with plans for long-term growth at Kodak Alaris?

GERBERSHAGEN: For me it is a perfect situation here. … The pension fund wants two things: stability, and they have a longer-term perspective. That is a significant advantage for us versus private equity ownership. We have the freedom to develop a five- to 10-year horizon for Kodak Alaris together with KPP. (Second,) they were very anxious to put an international team together who can take up the management of the company and drive this forward. I think they did this very well. I’m a German guy. You have part of the leadership team is here in Rochester—American people. We have people all over the place. It is a multinational company with a global business case. We operate in more than 30 countries.

Our charter is to develop this business into the future.

Motorola Mobility
RBJ: You most recently were at Motorola Mobility. What advantages and insights do you bring from there to Kodak Alaris?

GERBERSHAGEN: I have a strong consumer background on one side from the mobile phone business. I have a strong enterprise background from the customer base we had on the Motorola side, which is a perfect fit, I think, to the two businesses we are running here. I have a strong customer focus. Whatever we do, the customer is the center of all of our activities. At the end, customers are driving our business case forward.

I come from one of the most competitive industries. I always said we got in the morning into the office and didn’t know how the day would end. Mobile phones is almost like a quarterly business. Every six months you refresh the product portfolio and have to make sure you stay in the game and want to crank up your market share. It is extremely competitive. I think I add a lot to the Kodak Alaris culture, and it comes complementary to the culture. Here the culture is focused on the assets, the development—what we have with Kodak Alaris.

I think I can bring basically the speed, agility, freshness. I can bring a different perspective from a different industry to this, and especially when we look at developing the PI business into the Internet, mobile and social networks.

RBJ: What do you see as the biggest challenge facing you and the company, particularly over the short term?

GERBERSHAGEN: The biggest challenge is to decide upon our priorities.

There are so many things we can do—and I told this to the team yesterday. The challenge is to decide on what we’re not going to do, because there is an overwhelming amount of opportunities here. I think we have to pick our best. We have to be very careful how we utilize our resources; we have to do what we can to scale this business up. We are going through this process at the moment. Focus is very important—decide what we are going to do and we are not going to do.

RBJ: You have described Kodak Alaris as a billion-dollar startup. Many startups face challenges for funding. What is the situation at Kodak Alaris regarding funding, given the assets of the pension plan?

GERBERSHAGEN: We are not worried about funding at the moment. That is a major difference to another startup.

RBJ: What role do you see for the Rochester operations and employees? Any potential for growth here?

GERBERSHAGEN: Rochester is the lifeline of the business. We are looking into every area right now. We are active in more than 30 countries, on every continent. This front-end expansion plan—this is one area—the charter of Rochester is to support the teams out there. We have strong R&D teams here. They have great ideas. We need to develop … and feed the teams these ideas. Part of the management team is here in Rochester. I don’t see any changes at the moment. And the facility here is clearly to support our expansion plan on the go-to-market side.

RBJ: How important do you see the company’s investment in R&D?

GERBERSHAGEN: It is extremely important for us. When you look at the major theme of Kodak Alaris or Kodak in the past, (it) was innovation. … They have done a tremendous job to develop where we are today. What I saw was there are a tremendous amount of things they are going to patent and which are in development here, which is going to steer our business into different directions.

First 90 days
RBJ: What will your first 90 days entail? What do you see as most important to accomplish?

GERBERSHAGEN: I’m very much into people; people are very important for me. I started in Brazil last week. I met everybody down there. This week here, make myself familiar with the situation. Introduce myself to people yesterday. Next week back in the U.K., Germany, France, Italy and Spain—same thing, see customers and meet all the employees, see what the opportunity is. And a little later, going to Asia. … In parallel, meeting with the leadership team to define our priorities on how we develop the business forward. These are my key topics for the next 90 days.

RBJ: What response have you received so far from customers? 

GERBERSHAGEN: Very interesting. Even before I started last Tuesday, a lot of customers contacted me, because the announcement was four or six weeks earlier. Customers said congratulations, glad you joined, gives a new perspective to the business. Kodak Alaris has a very loyal customer base around the world. It is an unbelievable asset we can draw on. Even (with the) difficult time the team has gone through the last couple years, it is amazing how loyal the customers are to the business. And on the other side how motivated people are to really kind of take this challenge on and drive this forward. I’m really amazed at this.

For me, again, it is very important to create my personal relationships with key customers around the world. That is the reason why I’m probably on the road for the next six months.

RBJ: How will you measure your success as CEO?

GERBERSHAGEN: There are a lot of things we measure at the moment. Short-term view, we have a target for this year, which we have to achieve. I’m very focused on the numbers. Once the plan is agreed, we need to get there. That is one thing we are driving. The second element is to drive a longer-term perspective. We are looking into a five-year plan and a 10-year horizon, even. There is a lot to be done here: set the company up for the future, define our priorities.

Surprises?
RBJ: What has surprised you about the company?

GERBERSHAGEN: A couple things. One, the technology we have in the company. I think this goes way beyond what I thought was available. The second element was clearly the motivation of the people and the teams we have. I heard this throughout the entire interview process, between the lines, that there are strong emotions, there are strong people and strong teams here attached to the company.

That is one of the reasons I joined. I really loved that. I believe that if a company has employees and people that are so emotionally attached, I think that is a strong asset, a great basis to develop the business.

The third element that surprised me was the Kodak Moment hashtag. I could not believe when people told me how many people store their pictures on social networks under Kodak Moments. There are several hundred thousand pictures, where people (connect) their emotions and their private lives to our brand under Kodak Moments. I think that, from a branding perspective, this is where you want to be.

4/11/14 (c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


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