With so much history between the former ACCO World and GBC, it’s easy to forget that the new company – ACCO Brands Corporation – is indeed a new company. The merger between the two firms came to life just over a year ago and ACCO Brands is now a publicly quoted entity on the New York Stock Exchange (ticker symbol ABD).
But the company’s heritage is of course very different. Its brands are well recognised globally in the industry and many of them have been around for over 50 years, with ACCO itself – the American Clip Company – dating back to 1903.
As with all mergers and acquisitions, the trick is to ensure that the merger and integration process positively affects the values that both organisations bring to the party. ACCO Brands has turned this process into an internal war cry under the banner of the ‘Power-of-One’. Peter Munk, ACCO’s new European president, has identified three key outputs that he wants the European office products division to pursue as a direct result of that process.
"When I joined the organisation earlier this year," says Munk, "I was really impressed with the depth and quality of the trade relationships and by the passion and the variances in the former organisations. Coming as I did from Black & Decker, one of the most profound differences I saw between my former industry and the OP sector was the way the consumer/user is used to drive the business.
"I was surprised about the degree of trade focus and how the emphasis was almost completely on ‘filling the trade pipeline’, and how even that was approached on a per country basis with the central and overriding focus on the product alone."
By pulling their experiences together and extracting the best out of this vast pool of information, Munk and his team realised that right under their noses they had a colossal amount of consumer information – it just hadn’t been compiled or applied effectively.
One of the principal challenges and tasks for ACCO Brands in Europe is to now pool this information, apply it to its strategic, product, branding and development plans and drive that newly created consumer demand back into its partnership network.
The second part of this new consumer-led approach deals with the way ACCO Brands interacts with the trade. Says Munk: "By developing consumer understanding, our interaction with the trade evolves rather differently. It’s much more about ‘we are certain… and we want to share the business opportunity with you. In order for us to both make money, we will do this and we think you should do that’. This is a completely different approach to ‘here’s my new range of widgets, it’s 20 percent less than the old ones!’"
Munk explains how serious ACCO Brands Europe is about its consumer-led strategy. "In the short time that I have been here, we have invested some €350,000 in consumer market research in five major EU markets. We have also undertaken the largest packaging revision ever in Europe to enable buyers of GBC consumables to understand what other GBC products they can buy to improve the way they both present and protect their documentation – this project alone will hit well over five million EU consumers/users in 2007."
Any consumer-led approach inevitably leads to the question: "Where exactly are the consumers, our potential customers? Do they know about us, should they know about us-
It is these questions that have led ACCO Brands to restructure its sales regions to include a new Eastern European segment under Andreas KrÙger, formerly part of GBC Germany. The new focus includes a new rep office in Moscow. The company has also been quick to build on its former GBC operations in Iberia and Scandinavia, and offices in these regions have been ramped up to cater for the enhanced product ranges.
Most consumer-focused companies use the ‘product category’ as one of their stock tools-in-trade to communicate brand and product understanding. In the case of ACCO Brands, its second ‘Power-of-One’ learning vehicle is that of category understanding.
Unsurprisingly, the learning curve here is quite steep, given that the two former companies have a long combined history in the European market.
Munk says: "Being consumer-led leads right into how we view, understand, communicate and develop our various categories. By comparing the facts from the previous organisations with data from over ten European countries, our category and market understanding is now unparalleled. Furthermore, our business model made up of business units is taking category understanding into our local trading companies and out to the EU consumer, all supported by a shared service platform that has been designed around this logic.
"This in turn has major consequences for our communication and product development strategies. It also links directly to our stated corporate desire to reduce our brands to a manageable few and to drive those brands hard into the broader EU marketplace."
Combining this category understanding with the consumer perspective also brings to light some opportunities in existing as well as potentially new channels of distribution. These opportunities, adds Munk, are not necessarily just sales, but are also very much margin-based.
A key part of its partnership programmes is to actively demonstrate and support how to achieve better returns from existing products in existing categories. "In many cases," Munk says, "a better appreciation of the dynamics of the category and a clear understanding of what is in the category and how to sell it is all that is needed".
ACCO’s Kensington brand, the computer peripherals branch of the company with significant interests in the OP channel, is a good example of the structure of categorisation and how this is driven by consumer thinking.
The Kensington approach is taken from the actual consumer application and communicated in a way that the consumer can relate to. Phil O’Neill, who runs Kensington’s interests in Europe, explains: "When the category data comes into the back of the business, it follows exactly the same route through all the sales, margin, customer, geographic and unit/market data channels. Only in this way can both our own people and our partners grasp the actual dynamics of what is going on and what needs to be done. This categorisation has taken us years to perfect, but the benefits to the bottom line are transparent – it works and it works well."
Innovation with a difference
Much has been written about the need for serious product innovation in the office products industry. Depending on who you talk to, this perceived historical lack of product innovation – with its resulting tendency towards lower prices and margins – has been blamed on the distribution as well as the manufacturing side of the industry.
According to Munk, his company’s approach to innovation is about much more than just the product. He says: "ACCO Brands takes a much broader view of the innovation process – it’s not simply about the product. Of course, product innovation remains a central theme, but we are focusing our investments way beyond simple re-colouring or additional individual features to product development projects. We are looking at aspects that can actually change categories and the way in which consumers look at how they work and what they need to do that work.
"This process goes hand-in-hand with our consumer-led thinking and our category understanding. But even more significantly, it fulfils the need for further ‘pan-Europeanisation’ of our product lines, so that we can benefit from our new scale and our self-imposed high standards of logistics excellence."
The firm’s new Rexel Mobile Organisation integrated filing and archiving range aptly illustrates its attitude towards innovation. Phase one of this range was introduced earlier this year on a pan-European basis by the Storage & Organisation business unit at ACCO Brands and has already won two industry awards. It is based on and driven by the results of significant research which showed that people approach project work in a much more decentralised way today.
This need for mobility has led ACCO Brands to combine the historical two-sided filing and archiving category approach and create one integrated solution that literally moves with the consumer/user and makes it look like a product from 2006 and not 1956.
Munk explains: "Imagine you are a doctor, an architect, an insurance agent, an estate agent or even a plumber, builder and market gardener – just how useful could a product like that be? The potential applications in small as well as large corporate businesses are immense."
But as Munk points out, the quest to change categories is entirely dependent on two major factors – people and processes. He says: "We are very lucky in that we have an exceptional pool of talent as a result of the two companies joining together, but one of our key strategies is also to draw experience from other industries to help us innovate from within.
"Our new European leadership team, for example, now includes several members that have come from non OP industries – including myself, of course. It is these people who naturally tend to bring new processes, new ideas and new visions. It could be about anything, from how the company launches new products; how it can communicate directly with consumers; how it recruits; how it can get product from Northern Europe to Southern Europe in 24 hours; how it processes thousands of orders per day – this list is endless.
"Our challenge is to write the best of all these ideas and visions into our current manuals to enhance our overall performance."
When asked which of the three ‘Power-of-One’ outputs he saw as his priority, Munk’s reply was rather cryptic. But it also represented perfectly why the new company is that little bit different and why the future looks bright for ACCO Brands and its partners: "If you were an OP consumer/user, which one of the three would you choose-
GBC, NOBO, Rexel, Kensington and Mobile Organisation are all registered trademarks of ACCO Brands Corporation.