Leading the POS market from the front
In the second of a two part interview with RCH CEO Stefano de Pra, we delve further into the concept of market leadership, how innovation means more than just coming up with groundbreaking ideas, and what 2020 will hold for RCH.
What does the idea of ‘market leadership’ mean to you?
Market leadership is a tricky term – in many ways it has become one of those business buzzwords. That’s not to say that it doesn’t carry meaning: just that it gets constantly thrown around and misapplied, or used lazily or without consideration. I don’t like that, because to us it’s not just a metric, but a fundamentally important concept.
For instance, a lot of people might talk about market leadership in terms of financial performance. Who has the largest market share? Who is leading in terms of profitability? These are of course key concepts. And arguably, they are good ‘symptoms’ – a company that is performing well metrically is probably also performing well across the board. But not necessarily.
For us, our main concern in relation to ‘market leadership’ is: where is the market looking? Who is it looking to? Whose opinion carries weight? Who is innovating, pushing the boundaries, changing the rules of the game? Who are the thought leaders?
It’s this that really concerns us – it’s key to our philosophy. We want to be the market leaders of ideas, not necessarily profits. And I’m proud to say that after 50 years, I’m comfortable with calling ourselves market leaders in this sense. That’s not to say our financial performance isn’t also incredibly healthy – we’re looking at achieving a turnover that is three-fold of our 2018 performance – but it honestly makes me prouder to see recognition in the market – from competitors and clients alike, rather than just looking at a healthy bottom line on our P&L sheet.
You can see it in the way that people recognise and relate to us at tradeshows, in the feedback we get from our business partners and clients, and from the industry press recognition we often receive. If you really want to be a market leader, you have to recognise that your clients are far more than a sales statistic to be logged in an accounting ledger.
I think you also have to be careful about what – and where – you mean when you say you’re market leaders. RCH has engaged in some sound geographic growth – we now have strong presence in Italy, Austria, and Germany. But the way in which we lead in each of those markets may be subtly different, because those markets themselves may have subtly different needs. We have an ambition to eventually enter and then lead in the US market, but you can be sure that the needs – and thus the nature of market leadership – will be very different indeed. We always want to take time to work within a market properly and understand it truly rather than jumping into new markets blindly and without consideration.
So what precisely is it that makes clients and competitors look to you as market leaders then? Innovation seems to be a key aspect, which you touched upon in the first part of our interview. How does that work?
I think it’s not just the fact that we innovate, it’s the way that we innovate. Innovation isn’t just about crashing a new idea onto the market and thinking that the amazingness of this new product will speak for itself.
Instead, it’s about watching existing practices and making logical, reasoned developments that are extrapolated from that existing consumer knowledge. I mentioned in the first part of the interview that I like to sit and watch people use cash registers and EPOS – or even just take people’s orders with a trusty old notepad and pen. Really paying attention to this behavior and being analytical about it is how useful innovation occurs; innovation is not something that occurs in a sterile computer lab where a lone programmer has suddenly had an incredible coding brainwave.
Then there’s the issue of implementing innovation. So you’ve seen that gap, that need – and you recognise that with a fundamental paradigm shift in how things are done, you could make your clients’ lives ten times easier. That doesn’t mean you can just dump a completely new solution on the market and expect them to adopt it or appreciate it.
It’s a fundamental truth that the majority of people – and organisations – can be fearful of change, and slow to adopt it. So if you want to innovate in a way that will change the fundamentals of a process completely, it has to be undertaken gradually. And carefully.
Take for example the latest enhancements of our EPOS solutions. We’ve engaged in a push to transfer functions to the Cloud. By doing so, the number of things we can allow users to do with their data is astronomical. From fiscal legal compliance to gaining deep insight in business performance to off-site monitoring, Cloud-based retail activities hold such incredible potential. But the problem is that a transition like this one can be a scary transition – especially for smaller retailers. That’s not just because of security fears, but because people are worried that they won’t be able to adjust. Will they have to learn a new way of doing things? What if they can’t? What if they feel like they’re going to fall behind as they try to move forward? What was wrong with the old way anyway?
That’s why we make sure that we keep the front-end of our products intuitive, familiar and comfortable. Our solutions emulate processes that already feel natural. Then, in terms of back-end functionality, we introduce new elements stage-by-stage, allowing for users to adjust and become familiar with each new additional function and come to understand its full value, before moving on to the next augmentation.
At the same time, open communication compliments all of this. We train our business partners to talk about the benefits our products bring in a way that is meaningful to end users. Our business partners share our philosophy about truly listening to clients, so they are ready to address fears, concerns and questions through open dialogue, rather than stock responses. And then finally on top of that, we have exceptional training resources.
By taking this approach, we’re able to make real changes in the market and the way that EPOS systems are used. We’re trying to change mentalities, and bring a new language of use. Incremental change to the way that users approach the use of the system means that they don’t feel overwhelmed, and are more receptive changing the way they do things – changing to a way that is more effective, efficient and economical.
So really, innovation isn’t a singular activity – but a long process that stretches from development, through implementation, and right to the point of sales and even after-sales support. All of those elements are needed to develop product solutions that can truly be called ‘market leading’.
And so where will all of this take you in 2020?
Well, essentially, more of the same, but better than ever. Step by step: grow, improve, grow, improve. Raise the bar all the time. Pay attention to gaining mastery in each market, one at a time, and when we’re satisfied that we’re meeting that market’s needs fully – move on to conquer something new. To avoid saturation in existing markets, our focus on beautiful design and aesthetics will always be our trump card – and keeping up with the ongoing fiscal law changes we mentioned in the first interview will also keep us on our feet.
In terms of international growth, we’ll be dealing with the French and British markets and in the long-term we aim at increasing our market share in the US and China. The latter sounds pretty ambitious but we are always committed to new opportunities and proceed step by step.
Finally, we’d like to keep pushing the boundaries of what EPOS technology can do, and how it can benefit users. This means not just developing the technologies, but changing underlying mindsets too. Movement to the Cloud and the use of Android application-based systems will be fundamental to this – but not as fundamental as talking – and listening – to our clients.