Rokus speaks: Océ is here to stay

The times are a-changing for Océ, and CEO Rokus van Iperen has big plans for the future.

Under the motto "if you aren't big, you have to be smart", van Iperen has in his eight years as CEO marked out a survival strategy for the company, traditionally known as a manufacturer of copiers and printers.

"We have to concentrate our development efforts on products in which we are the leader, and apart from that sell machines which are the best that other manufacturers can produce," he says.

van Iperen has rapidly changed the character of Océ. It was a big shock for the North Limburg region when he transferred the production in the past few years to Asia, where it is now handled by mass manufacturer Flextronics. "Because they also produce for other brands, they can purchase components at much lower prices," he explains. 

"We've had the discussion of whether they can supply quality in China. But to be honest, we find the quality of the products they make for us higher than the quality here."

Since the beginning of this year Océ now sources copiers from competitors and markets them through its sales network. By broadening its portfolio in this way, van Iperen hopes that Océ will win bigger contracts. "It has required a mental switch here. People have grown up with pride in their own products. But now that also includes products made by others," he says.

Paper isn’t everything
Recently, van Iperen launched a new initiative which calls for the development of a new research center in the Venlo area with the ambitious name of Document Services Valley.

In this new environment, open innovation will be the driving force for the processing of documents regardless of whether they are on paper or in digital form. As part of that initiative, Océ is digitising companies' document archives. In a hospital in Limburg, Océ is experimenting with the digitising of patient dossiers while also working together with the US company CaseData, which it recently acquired, on the development of software for searching through large quantities of information in lawyers' offices.

van Iperen admits that this had "nothing at all" to do with printing, but he still believes it is important. "We regard everything that is related to documents as part of our mission," he says. "Opening up new growth opportunities. We want to help customers to use information more efficiently and more effectively."

In the first year around 50 people will work in the new research centre, and a number of them will have to be persuaded to move to Venlo. "It's still a big step for people from the west of the country to come here to live and work," van Iperen says.

Océ is now trying for the first time to recruit internationally, by offering students from Asia a grant to study at the Eindhoven University of Technology, on the condition that after graduating they work for three years at Océ.

Nothing to fear
As long as his growth strategy keeps working, van Iperen isn't worried about pressure from shareholders who expect quick returns. "We regularly talk to the seven large shareholders, who together hold around 40 percent of our shares. We have committed ourselves to doubling our returns in four years. Up to now, our returns have increased from 5.5 to 6.6 percent, and the target we have to reach is 13 percent. We still have a long way to go, and if we don't succeed we will certainly have an issue," he says.

But speculative investors haven't yet made an appearance at Océ and nor have parties wanting to acquire the company. "If we're ever taken over, it's more likely to be by a strategic player than by private equity," he admits. "But I don't think our three big competitors are interested." And what about Kodak, which is looking for new markets after losing a lot of ground as a result of the digitalisation of photography? "I won't mention any names, but a competitor could well be interested,” he adds.

“I'm not dogmatic about staying independent, and certainly not if someone is prepared to offer a high price. But even then it's still up to us to decide on how well it fits in our strategy, and whether it's good for our customers and our employees."

Since a high share price is the best "protection" against unwanted advances, Van Iperen looks at least twice a day at how the price is moving. In July, Océ shares reached their highest price of 18.58 euros, after which they have fallen back steadily to yesterday's closing price of 13.56.

The main explanation seems to be the falling value of the dollar, and the fact that investors regard Océ - which earns more than 40 percent of its revenues in the USA - as one of the companies with the highest exposure to the dollar. "But that's no longer the case, because we now produce in countries whose currencies are tied to the dollar. If they were forced to let go of that link, then we would have a problem," van Iperen says.

van Iperen, who has served as a CEO for eight years, is confident not only of Océ's future, but also of his own. He believes that he will make it to the company's 135-year anniversary without any problems at all. "The only time I talk to head hunters is when I'm looking for new staff," he says.