Invest KOREA

Building on Trust

Fuji Xerox Korea provides solutions and services in a changing consumer environment

When a staff member complimented Yasuaki Ueno, the president of Fuji Xerox Korea, on his tomato red tie last month, she learned it wasn’t his. He had recently swapped his gray tie for a young staffer’s red one over drinks. Ueno does worry he might have taken a tie of sentimental value, perhaps one given by a wife. But this is part of how he builds friendly relationships with his employees.

He joins them for smoke breaks too, just saunters over to their semicircle. He also ventures beyond Fuji Xerox Korea’s Jung-gu headquarters for unofficial visits to branch offices to hear what staffers have to say without “filtering.”

The aim is to build trust, because trust is what the company sells, Ueno said. Fuji Xerox’s philosophy is that customer satisfaction lies in employee satisfaction, and that being healthy as a company involves not just financial health, but emotional well-being.

“If our company is not healthy, nobody can trust our solutions, our consultants,” said Ueno.

With this approach, Fuji Xerox Korea - or FXK, as employees call it - has flourished since its founding in 1974. It has gone from manufacturing and selling office equipment to also providing solutions and services. Today the company has three main businesses: the office products business; the production services business, which provides print-on demand service via digital printing and targets the graphic art market; and global services, which help companies become more efficient and reduce costs through consulting and outsourcing services.

FXK has an almost entirely Korean staff of 1000, sales branches nationwide and capital of 14 billion won ($11.8 million). Korea is one of the 12 countries Fuji Xerox is in in the Asia Pacific region, excluding Japan.

The Korea unit’s growth is no small feat considering the domestic office equipment sector barely existed just 40 years ago. Photocopiers were restricted from being imported, and the only ones available back then used photosensitive papers. But the popularity and advantages of Fuji Xerox’s copiers elsewhere in the world led to the opening of a Korea office in the 1960s on the Yongsan Army Base in Seoul. In 1974, Donghwa Industrial of Korea and Fuji Xerox entered into a 50-50 joint venture with a capital stock of 600 million won.

For the next three decades, the company sold photocopiers using ordinary paper, laser printers and multifunction devices. But as the consumer environment changed and customers’ business issues went from simple to complex, FXK decided it needed to do more than sell devices to grow; it had to support customers’ businesses by helping with issues including document management - an area Ueno says is not the core business of its customers. FXK entered the document consulting and outsourcing service markets in 2006.

“Most customers do not know how [much they] print or how many documents they generate per day or per month,” Ueno said. “They have no integrated management structure to manage office equipment.”

FXK steps in to control document flow, reduce operating costs, provide document security solutions for paper and electronic paper and remotely monitor what is needed where - Is the printer out of toner? Does the copier need ink? - before the customer contacts FXK’s call center.

The company also supports marketing activities by, for example, customizing direct mail advertising methods and providing consulting and customer database analysis. This is possible through digital printing, which, unlike the typical printing method of offset printing for one fixed set of data, can handle variable data. This means a company can diversify its marketing message according to the customer.

FXK is not hindered by the fact that people are using less paper. For a while there, it seemed like everyone was talking about going “paperless, paperless,” Ueno said, but he still considers paper the best communication tool. And his consultants can help customers figure out how to use less of it by, for example, reducing unnecessary printing.
The service side of FXK makes up less than 20 percent of business. In advanced countries including the United States, it accounts for almost 50 percent.

“That’s why we still believe once we focus on more service business, we can expect higher growth,” said Ueno.

Korea’s relatively low printing digitalization rate - about 10 percent - despite a global shift in trends from offset to digital printing presents more opportunities. Korea’s advanced IT industry does as well. The advent of more impressive technologies means opportunities for FXK to develop more advanced solutions and businesses.

Having been with FXK for a year and Fuji Xerox for 28, Ueno knows that to realize this growth, his company must continue to take a Korean approach to business, one focused on “human to human” interaction. While the Western way of doing business can tend to focus on global processes and cost effectiveness, the Korean way focuses also on customer interaction - face-to-face communication, record-fast response times and, of course, relationships based on trust, he said.

FXK has ranked number one in the copier category on the Korea Consumer Satisfaction Index for ten straight years.

The company also boasts the distinction of being the first foreign-invested company to declare zero labor disputes. It won the Presidential Award for Labor-Management Culture in 2001. These and other awards take up a wall in the executive meeting room.

But ask Ueno about his proudest achievement at FXK and he’ll point again to the relationships he has developed with staff members and customers.

“We cannot survive our business without a trust relationship with customers,” he said. “That is a fundamental business dynamic.”