AmCham Shanghai’s Technology & Innovation Committee and Gelato, a global platform company powering the world’s largest print cloud, organized a spotlight panel discussion on the topic of How Going Digital for Printing Solves Your Localization Problem on May 9th, 2017 which gathered over 35 participants. The panel discussion focused on how cloud technology and online platforms have revolutionized how we reach our customers with a specific focus on transformation of digital printing industry.
Dr. Hugh, co-chair of the technology & innovation committee kicked off the session with general comments on how platform strategies are driving digital transformation and disrupting many traditional industries. Digital Platforms have the potential to generate new value in most traditional industries by allowing the two sides of the platform (buyer and sellers for example) to better coordinate and exchange products and services.
We commonly only look at Amazon, Airbnb, Alibaba etc. as platform businesses but platform strategy can be effectively applied to any traditional industry. Dr. Hugh shared some general trends underway and how leading technology platform providers are making it easy to create specific business models on top of the digital platforms and transform various industry segments. Below is a general framework that can help entrepreneurs and companies to create and evaluate digital platform opportunities.
Dr. Hugh outlined the agenda to first hear from Microsoft how they are aggressively pushing the cloud platform business across the globe including in China, as well as look at a case study of Gelato as one example of how platform strategy can disrupt a very traditional printing industry. Dr. Hugh introduced the two speakers: Lars Torstensson, Chief Communications Officer of Gelato, and Dr. Xu Mingqiang, Chief Technology Officer of Microsoft Greater China and mentioned that after the presentation we will go a panel discussion and Q&A session with the audience.
Presentation by Dr. Xu Mingqiang, Chief Technology Officer of Microsoft Greater China
Dr. Xu Mingqiang from Microsoft shared their cloud platform strategy for China and how they have invested in building multiple local cloud platforms to service the China market.
He explained that Microsoft is offering to customers the same technologies that it uses to manage its own global cloud network to power over 200 Cloud Services, many of which hundreds of millions of users globally use every day.
With decades of experience servicing enterprise customers, Microsoft has invested heavily in making sure its cloud platform not only has a presence in key global regions but also has industry strength security and compliance certifications that are critical for enterprise businesses.
Presentation by Lars Torstensson, Chief Communications Officer of Gelato
Next Mr. Lars Torstensson made a presentation introducing Gelato’s digital platform and how it is unlocking business value for global companies and print houses.
Lars mentioned that printing is an $800 billion a year industry which has not changed the way it distributes orders for decades. Even though a lot of content is being generated and consumed online, the traditional printing industry continues to grow to meet new demands for high-quality prints.
Lars shared how Gelato is disrupting the traditional printing industry through their digital platform that allows businesses to coordinate high-quality printing of marketing material around the globe. Gelato identifies and partners with quality printers worldwide, connects them to a cloud platform and offers access to customers looking for a hassle-free printing experience across the various countries where they do business. Rather than worry about details of paper quality, printer quality, color management, and time to deliver, the customer can upload the digital print files of their marketing materials to the cloud platform which ensures the print runs meet their corporate quality standards and are delivered just in time – making storage obsolete. The print platform empowers the customer to change their approach to printed marketing materials, follow marketing trends and move from mass-produced bulk orders to smaller print runs of personalized materials. Rather than spending time coordinating with local printers on details of the job, which can especially be challenging in many Asian and South American markets, corporate customers can focus on their digital assets and let the physical production and delivery be taken care of by the Gelato Globe service through the Gelato Network and its approved & certified print partners. The Gelato ecosystem also includes relationships with logistic partners so that the finished printed material are delivered to the right customer location at the right time before important deadlines.
Lars mentioned some of the inefficiencies and challenges that global companies face in having to find and coordinate printing projects across the dozens of countries where they do business. Often the local print shops are small businesses, and it is hard to evaluate the quality of the print jobs and manage the project and logistics to ensure that print jobs get done on time, are of consistent high-quality, and get delivered to the right location for an important marketing event. Negotiating optimal pricing, batch sizes and quality is often a challenge and bind valuable (and often scarce) in-house resources to admin tasks that could easily be handled by the Gelato Globe technology.
On the supply side, the print shops are often small businesses who find it difficult to expand and grow their business beyond their local markets. It is hard to them to market their services to corporate clients and showcase their quality and equipment. Today’s professional print machines cost millions of dollars, and it is very uneconomic to have them sitting idle. Many printers may have an online website but the capabilities of their website are often limited to static information about their services rather than full online collaboration and coordination of various types of sophisticated print jobs. By leveraging the Gelato digital cloud platform, high-quality print houses can become part of a global network through which large enterprises can find them and easily coordinate their print projects.
Gelato has been experiencing explosive growth globally. They have recently entered the China market with aggressive plans to help both global companies and local professional printers better coordinate their activities through their digital platform. To meet the technical and practical requirements in different markets, the Gelato platform leverages the best available platform technologies in each of the markets they operate in. In China the company uses Aliyun, in some markets Amazon Web Services (AWS), while other markets like Russia, Microsoft Azure Pack.
Panel Discussion and Q&A:
After the presentations, the two speakers joined Dr. Hugh for a lively panel discussion and Q&A with the audience. Following are the highlights of some of the topics covered:
An audience member pointed out that as Gelato enters the China market, it might be important to test assumptions regarding the customer value points since some of value dimensions may be different. The labor costs in China are lower than in the western countries and so are the logistic and shipping costs. It may turn out that having consistent corporate standard quality of the print material in quick turnaround time may be more important for customers operating in China than the shipping costs. Mr. Torstensson agreed that every country has its unique characteristics that need to be taken into account, but that the Gelato software has many benefits above and beyond quality and delivery time, such as brand consistency and cost transparency, that will benefit the customer.
Dr. Xu mentioned that there is an opportunity for new partners to help Microsoft provide cloud-based solutions to customers in China since their core platform technologies needs consulting services to integrate the pieces before customers can fully realize the benefits of a platform solution. Many traditional partners are finding it challenging to develop new capabilities needed and so there is opportunities for small focused partners to develop deep skills and work with Microsoft on delivering Cloud Platform based solutions.
Dr. Hugh is part a software company in California, Xavor Corporation, that has been Gold Partner with Microsoft for over 20 years and echoed the potential business opportunity in China. For global companies operating in China, Microsoft Cloud platform will have some advantages over other local Cloud Platform providers mainly due to the fact that Microsoft Cloud is compliant with most of the European and American data security, reliability and compliance standards and also maintains global network of data centers which are all certified to meet local government regulations and yet are part of the overall global network to provide customers and easy way to manage their corporate assets in secure and reliable manner while ensuring high availability and performance to its customers.
Another topic addressed in the Q&A session included new cybersecurity law in China. The new law goes into effect begin June and it is not clear how it will affect companies since the law is quite broad and not very specific in the implementation details. Most panelists agreed that is a critical area on which all the technology companies and the large enterprises are working on to ensure that they remain compliant with the new local cyber security laws. In fact, besides legal compliances, enterprises now consider their data security to to business critical and are so working with leading technology partners to upgrade their digital platforms and infrastructure. Considering the issues of corporate security breaches we hear on frequent basis, this trend is likely to continue and US companies like Microsoft, IBM and Chinese giants like Alibaba, Tencent are pouring billions of dollars to build, operate and offer generic cloud platform services to traditional businesses to focus on designing their digital business models rather than having to build and operate the cloud digital infrastructure. Industry 4.0 and China’s Intelligent Manufacturing vision 2025 will further accelerate this momentum.
Dr. Hugh is a practitioner-scholar with over 25 years of experience working and consulting with global organizations in the US, Europe and Asia in areas of IT-enabled business innovation.
Currently, he is heading the Xavor China operations (based out of Shanghai) to facilitate product innovation ecosystem development between multi-nationals and startups in US and China.
Dr. Hugh maintains a strong network of university collaboration in the US and China through his MBA teaching of courses in Design Thinking & Design-Driven Innovation, Cross-Culture Management and International Marketing at various universities including University of Southern California (USC), Wuhan University, Chongqing University, Beijing Normal University, Peking University, Renmin University and Fudan University.
In addition, Dr. Hugh is also the founder of Xavor Corporation, which provides innovative business solutions to high-tech organizations. He has a BBA from University of Texas Austin (USA), Executive MBA from University of California at Irvine (California) and Doctorate in Management from Case Western University in Cleveland, Ohio (USA).