I M T D C P

2014
Ricoh
Section B

Ricoh
Group 1:
Madhav Mathur 1302-080
Mayank Raheja 1302-085
Nandita Jaiswal 1302-087
Nikhil Dangayach 1302-089
Nupur Gupta 1302-099
Rishabh Aggarwal 1302-121
Ritika Mital 1302-123
Contents
RICOH: BRIEF INTRODUCTION .................................................................................................................................... 2
What are implications of strategic actions on organization structure? ........................................................................... 4
Operations of Ricoh .............................................................................................................................................................. 6
Sales & Support .................................................................................................................................................................. 6
Ricohs Growth Strategy can be analyzed under these four headings: ........................................................................... 8
Strengths and Competencies Of Ricoh .............................................................................................................................. 10
Ricohs primary activities for shareholders: .................................................................................................................... 11
The PESTLE analysis ......................................................................................................................................................... 12
Internal Industrial Environment ....................................................................................................................................... 15
Mergers and Acquisitions ................................................................................................................................................... 16
Porter Five Force ................................................................................................................................................................ 16
Financials ............................................................................................................................................................................. 17
References ............................................................................................................................................................................ 21

















RICOH: BRIEF INTRODUCTION
Ricoh ltd. is a Japanese multinational imaging and electronics company. It was established in Tokyo in 1936
and now operates in more than 200 countries and regions. The main products that it offers are electronic
products, primarily camera and office equipment which includes printers, photocopiers, fax machines, office
software like document mall, global scan etc. in late 1990s, the company grew become the largest copier
manufacturer in the world. It later acquired Savin, Ikon, IBM printing division etc.
VISION OF THE COMPANY
To be the most trusted brand with irresistible appeal in the global market.
MISSION OF THE COMPANY
At the Ricoh Group, we are committed to providing excellence to improve the quality of living.





BRIEF HISTORY
The history of Ricoh will be explained in 4 parts: from 1936-1960, from 1970-1984, from 1985-1999 and from
2000 to present.
1936-1960 (starting out- entering the business machine field)
Ricoh, which was then known as Riken Kankoshi Co., Ltd, was initially established to manufacture and sell
sensitized paper until 1938. Kiyoshi Ichimura was appointed as the executive managing director until Jan 11,
1946. One year later, in 1937, it started its camera business. In 1938 it was renamed to Riken Optical Co., Ltd.
Kiyoshi Ichimura was appointed president in 1946. In 1950, it created Japans first mass production structure.
In 1955 it entered business machine field by launching the Ricopy 101 which was Ricohs first diazo copier.
1970-1984 (coining OA acronym)
In 1974, Ricoh launched Rifax 600s, which was worlds first high speed office facsimile machine. In 1977,
acronym OA was coined for office automation. Then in 1980s it extended office productivity support by
rolling out a lineup that included computers and word processors, optical filing systems and laser printers.
1985-1999 (driving digitalization)
In 1987, it pioneered multifunctional digital copier for office with the IMAGIO 320. In 1996 it popularized
digital models by launching IMAGIO MF200 which was a compact and highly affordable copier. Thereafter,
networkable and color offerings were released and in 1995 it broadened its international sales network acquiring
Savin Corporation and Gestener Holdings PLC. It also reinforced its overseas production structure by
establishing Ricoh Asia Industry (Shenzhen) Ltd.
2000 to present (going global)
Ricoh strengthened its overseas sales network to bolster its solutions capabilities. It acquired the European
operations of Danka Business Systems PLC in 2006 and bought IKON Office Solutions, Inc., in 2008 to build a
global sales support structure. Later in 2002, it became the second Japanese company to participate in the global
compact of the United Nations which was under its environmental and corporate social responsibility program.
It acquired the European operations of Danka business systems in plc in 2006. Then in 2008 it bought Ikon
office solutions inc. to build global sales support structure. In 2003 it was the first enterprise from Asia to be
awarded world environment center gold medal for international corporate achievement in sustainable
development.
(http://www.ricoh.com/about/company/history/)
What are implications of strategic actions on organization structure?

Mid -2000 saw Ricoh with a proactive management restructuring. This was a western style where there was a
distinction between the executive and operating functions by providing the heads of the divisions or subsidiaries
much more authority and power than what they previously had. Clearly this shift in the organizational structure
hinted a drastic change that the company wants to bring to suit to changing times.
In the early 21
st
century Ricohs willingness to embark restructurings and the strategic alliances to form new
products gave Ricoh a strong position. For Ricoh, restructuring means re-engineering, where there have been
several structural reforms have been conducted by the Ricoh group under the Corporate Restructuring and
Growth Project (CRGP) ever since October 2008.
Even the Groups personnel system is reformed over the several years and based on the achievements the re-
allocation of human resources will be done. These reforms are taken up to eliminate redundant positions within
the company and are aimed to consolidate major responsibilities within a single group. Giving additional power
to subsidiaries like looking after operations within adjoining countries or joining in under the ambit of the
head-quartered country, the subsidiaries now have increased power as well.

Ricoh India, a subsidiary is looking to keep its hiring on a low level to avoid extra burden on the company as it
is trying to maintain growth during its formative years. With the sales and after sales of MFP contributing 80 %
of the revenue, company is sure not looking at expansive recruitments. About 100 people will be hired to further
push the sales.
A restructuring was announced by Ricoh Americas Corporation which is designed to flatten the current
organisational structure, enable cohesiveness and improve communications of the Company in near future.
Eliminating the position of Chief Operating Officer of Ricoh, U.S is the first step of this move. Current CEO of
Ricoh U.S will now assume the role and responsibilities of the position along with being the President of Ricoh
US.
While second step is to appoint the President of Ricoh Canada, Martin Brodigan as the Chief financial Officer
of Ricoh U.S with the complete portfolio of customer administration, finance and accounting and IT, while at
the same time reporting to the CEO of Ricoh US.
Finally, consolidation of Direct Marketing and Indirect Marketing as one group under the aegis of a Senior
Vice President, who will also report to the CEO, Ricoh U.S.
To get rid of a few uncertainties and flatten the organisational structure, Ricoh Americas Corporation took the
aforementioned steps which will help the company in being more cohesive and responsive in times to come. By
eliminating the redundancies these changes will position the organisation rather dominantly for future growth.
Ricoh Australia too is looking for an opportunity to restructure itself along with the different department
heads to be merged as one so as to reduce the workforce numbers. Following the footsteps of Ricoh U.S, Ricoh
Australia is also looking to share the division with existing divisional heads of Oceania.

Ricoh Japan will cut almost 10% from its workforce to try and boost drooping profits as can be seen as a cost
cutting measure by infirm Japanese companies. Consolidating factories and letting go of unprofitable products,
Ricoh will slash down 10,000 of its jobs from its current global of 109,000. To fend off competitors like Xerox
and Canon Inc. Ricoh is using restructuring as a tactic. Ricoh claims that the job cut could boost operating
profits by $1.7 billion by year end in March 2014.
Even though acquiring of IKON Office Solutions did grab market share, but Ricoh still has a few overlapping
functions to get rid from. Ricoh Japan acquired IKON for $1.6 billion in 2008 mainly to capture market from
Canon. There surged a dearth of new popular products as margins in office copiers slumped amongst fierce
competitions while the workforce grew at a rate of 43% over 5 years. Being less efficient than its Japanese
rivals, Ricoh has had operating profits of 3% in the past years, but now is targeting to 8.8 % in march 2014.
All this led to the job slashing and drastic restructuring of the company. The company has spent about JPY
24.2bn to restructure itself and reduced the headcount in about 9 months. This brutal restructuring will
eventually give profits but till then Ricoh has a long way to go.
The most recent restructuring in the history of Ricoh took place in March 2013. Ricoh Innovations Inc. (RII)
is to now be restructured as Ricoh Innovations Corporations (RIC) with effect from April 2013. From being a
research centre of developing innovative technologies it will be expanded to development of novel businesses in
its ambit worldwide. Being reorganised as RIC, RII will now have the additional responsibility of leveraging
technologies developed by the Ricoh Group including RII and its subsidiary in India along with creation of new
global business.
Driving new business creation, RIC will build upon a combination research and technology. Founded in 1997,
RII was known for its elaborate set of competencies like computational optics, intelligent sensors, cloud based
collaborations and mobile visual communications.
Dr Nikhil Balaram, President and CEO of RIC, is happy about the expanded charter and reorganised corporate
structure and about incubating newer ideas and business projects. Concentrating on informative and disruptive
technologies, with a special focus on retail and health care, RIC will be augmented by Open Innovation through
various alliances and partnership strategically done with Universities and Companies.
Considering all the aforementioned reforms about maintaining an optimal balance between increased sales yet
controlled (rather tapped) manpower, Ricoh has a long way to go .
(Reuters)
(Economic Times)
(PRESWIRE)
Operations of Ricoh
Sales & Support
Ricoh is have comprehensive capabilities that helps it to meet customer expectations. Thier strengths lie
in their wide range of products and services , global sales and support network and excellent production
system. Ricoh has excellent sales and support system that caters to the needs of the customer. They
have regional production set ups in Europe, Asia and Pacific China, Japan and the Americas to help
them achieve local production for local consumption across four Ricoh regions. Their global
production system ensures that quality products and services for local customers' needs are delivered in
an optimal manner.
Ricoh provides one-stop solutions for various management issues to its customers. It provides advanced
document-related solutions and equipment. IT services and cloud-based communication devices and
solutions are also included in the operations. Ricoh identifies and deeply understands the needs of each
customer in order to provide optimal solutions to each customer. This process helps in identifying the
problems which the customer is himself unaware of. Ricoh offers a wide range of products and software
and support customers in solving the issues identified even after installation. In addition, it also
leverages its expertise and supports its customers in their efforts to improve operational efficiency and
reduce environmental impact in their offices.
1) Production
Ricoh believes in innovations and have come up with wide range of innovative cutting-edge products
and technologies over the time. They introduce various products in the same product line thus deepening
its product depth.
Some of the various products are
Digital cameras
Compact
GR Digital
GXR interchangeable sensor system
GPS and camera All-in-one
Film cameras
Multifunction Products/Printers
Document Mall
Software Solutions
Projectors (wikipedia, 2014)
They also sponsor various events and arenas acquiring their naming right they marketed their various
products.
Some of the sponsorships and arenas are: -
Ricoh Arena,
Ricoh Coliseum,
Ricoh Black Rams.
In 2007, Ricoh sponsored the Women's British Open, women's golf tour, the U.S. LPGA Tour.
(wikipedia, 2014)
Ricoh designed and sponsored the first eco-friendly billboard in Times Square, NYwhich
works completely on sun and wind. (wikipedia, 2014)

2) Research and Development
Ricoh has a global R&D network with the sales and services which carries out customer needs research,
as well as pure and applied R&D. it is mainly concentrated in the US, India, China and Japan. Local
factors are taken into account. Also, Ricoh promotes open innovation to accelerate R&D. It established
Technology Centers worldwide to support customers at each location and respond to the customer's
voice quickly.





Ricohs Growth Strategy can be analyzed under these four headings:
1) Investing in R&D and product innovation
Ricoh has always been an innovative company, thinking ahead of the time and coming up with brand
new technologies delivering outstanding products in the market. This has been one of the core
competencies of the company giving them competitive advantage amongst other players in the market.
Ricoh has invested heavily in this department over the years and it has been their key growth strategy.
For example, In 2004, the basic strategies of the entire Ricoh Group was affected by this one inovative
idea combining printer and copier. They were the first ones to notice the trend of colorization of copiers
and multifunctional printers (MFPs). Thus, they were able to think ahead and could readily offer the
customers wide range of products to suite their corporate character and needs. Ricoh has developed and
marketed many innovative products and accumulated significant technological expertise in broad range
of areas. They have the mission to continue creating new values that has never been seen before and
deliver it to the world by combining the technological excellence with the newly developed
technologies.
2) Mergers and acquisitions to strengthen market standing and competitiveness
Ricoh has participated in numerous mergers & acquisition in years to make a strong foothold in global
market and leverage existing infrastrure, technologies and distribution channels to increase their scale of
operation.
Their major strategic M&A in last decade has been:
Ricoh entered into a joint venture with IBM to form a new company known as InfoPrint Solutions
Company, LLC in June 2007. It was a division of IBMs printing systems which provided output
solutions for production printing area. This joint venture helped Ricoh in gaining benefit from IBMs
powerful sales and distribution network as well as extensive printer development capabilities.
To strengthen and broaden its business opportunities in North America and Europe, in October 2008,
Ricoh acquired IKON Office Solutions, Inc. ("IKON") through the Company's wholly owned U.S.
distribution subsidiary, Ricoh Americas Corporation ("RAC). As IKON is a supplier of large range of
office equipment, like printers, MFPs, and fax machines, in the North America and the Western
European markets. Ricoh could gain foothold in the North America and Europe, by using IKONs wide
sales and service network. IKON also provided access to its customer relationships, which includes
private corporations, government and public sector organizations.

3) Strategic alliances and collaborative partnerships
Ricoh Company Ltd. has an established strategic partnership alliance with world class software firms,
system integrators and capture technology vendors to create a never seen before end-to-end document
management solution. These alliances have helped Ricoh to develop applications that aid companies to
comply with both internal policies as well as external regulations.
To deliver a wide range of automated solutions like document lifecycle management, revision control,
archiving, security and workflow, Ricoh has formed alliances with Enterprise Content Management
software vendors. These combined (or joint) solutions provide a comprehensive set of scanning and
document management solutions. Document Assess Systems (allied in November 2005) offers its
consulting expertise to customers, while FileNet allows secure user authentication to access corporate
records and manage business processes. Both enable Ricoh in achieving its goal of providing end-to-end
document management solutions.
In January 2009, Ricoh announced a Global Strategic Alliance with IMB wherein the companies will
first launch a new Ricoh Document Security and Management Services (DSMS) in the US. This
agreement will demonstrate Multi-Function Product (MFP) based solutions leveraging Ricoh and IBMs
vast capabilities to address customers complex business problems.
In May 2010, Printable Technologies Inc., a world class SaaS web to print solutions provider formed a
worldwide strategic alliance with Ricoh Company Ltd. They are aiming to expand their relationship
with an integrated services offering. Realizing the maximum benefit of VDP, these services will provide
customers optimum production processes.
In May 2010, Ricoh formed another strategic alliance with DirectSmile GmbH, a leading supplier of
software for variable data printing and cross-media marketing. This step will further strengthen Ricohs
expertise in output solutions, particularly production printing. Ricoh will be co-marketing in the
production printing business area and re-selling the DirectSmile products.

4) Leveraging existing strengths to win in new markets
Ricoh has developed and marketed many innovative products and accumulated significant technological
expertise in broad range of areas. It has a large pool of existing knowledge and research acquired
overtime that can be used by to explore and generate new avenues for the company to plunge in future.
They can build upon their unique technologies, customizing capability and the global production
network to branch out into promising new fields and businesses in future.
They want to reinforce their products and services to come up with something new in future satisfying
ever evolving customer needs. Earlier they were only into products manufacturing, now they want to
expand their operations and provide new services integrated with their exciting products.


Strengths and Competencies Of Ricoh
Ricohs distinct strengths and competencies lie in the products and services that cover wide range of areas,
excellent production systems and their global sales and support network. Ricohs comprehensive capabilities
allow it to fulfill and exceed customer expectations.
The core competencies of Ricoh are-
1. Research & Development for the future:
a) Delivering innovation through imagination and ideas: Ricoh has developed and marketed many
innovative products and accumulated significant technological expertise in broad range of areas.
They are working to simultaneously improve user friendliness, quality and energy efficiency of
MFPs. From the starting they have worked on Quality Start UP technology which enabled a device
to quickly recover from its energy saving mode, thus avoiding the problem of waiting before using
it. Ricoh will continue to create new value that has never been seen before and deliver it to the world
by combining the technological excellence with the newly developed technologies.
b) Global R&D facilities: Ricoh has a global R&D network with the sales and services which carries
out customer needs research, as well as pure and applied R&D. it is mainly concentrated in the US,
India, China and Japan. Local factors are taken into account. Also, Ricoh promotes open innovation
to accelerate R&D. It established Technology Centers worldwide to support customers at each
location and respond to the customer's voice quickly.
2. Closer to Customers:
Ricoh provides one-stop solutions for various management issues to its customers. It provides advanced
document-related solutions and equipment. IT services and cloud-based communication devices and
solutions are also included in the operations. Ricoh identifies and deeply understands the needs of each
customer in order to provide optimal solutions to each customer. This process helps in identifying the
problems which the customer is himself unaware of. Ricoh offers a wide range of products and software and
support customers in solving the issues identified even after installation. In addition, it also leverages its
expertise and supports its customers in their efforts to improve operational efficiency and reduce
environmental impact in their offices.

a) Achieving local production for local consumption across four Ricoh regions: The four Ricoh
regions are Europe, Asia and Pacific China, Japan and the Americas. Their global production system
ensures that quality products and services for local customers' needs are delivered in an optimal
manner.
b) Cart production line (resulting in reduced power consumption): In Ricoh plants, innovative
production lines are in operation, which can easily accommodate changes in production volume and
customer preference while reducing energy consumption.
c) Kitting: Before the product is shipped, its customization with selected options and its initial settings
is completed. This service is popular among customers as setting up the equipment requires less time.
d) Resource-recirculation eco packaging: Ricoh started to use resin-based packaging which could be
used repeatedly as part of its resource saving efforts.
e) On-demand tonner filling: A small toner filling machine has been developed that enables the
production of various toner products in a smaller volume. This compact machine enables a shorter
lead time for toner production at locations that are closer to customers as it can be installed anywhere.
Moreover, it has less environmental impact.

Ricohs primary activities for shareholders:
a) Customers- The company strives to increase the customer value by providing products and services
which embody the brand Ricoh.
b) Shareholder and investors- Ricoh has long term strategies and thus look at the sustained growth of
the company. The company provides the disclosure and timely communication of all the information
which needs to be communicated.
c) Business partners- Ricoh truly believes that trust is essential for doing business. They also promote
socially responsible activities across the value chain.
d) Society- The company believes in giving back to the society through social contributions and
business activities. Ricoh shows a lot of respect to the local culture, religion and customs and also
contribute to its development in all possible ways.
e) Employees- It promotes health, safety and human resource development. Ricoh also believes in
employee diversity and good work life balance.
f) Global environment- Ricoh believes in doing business in an environmentally friendly manner and
contribute to the reduction of environmental impact.
The SBU (strategic business unit), is a profit making entity which focuses on offering commodities to a
particular market segment. They have their own marketing plan, financial system and they are responsible for
the profit and market share.
It a subset of a large business unit, for example digital printing is one of the SBU of the Ricoh group.
To analyze a particular SBU there are various methods like BCG matrix, Pestle etc.
To understand the external strategic analysis of RICOH we are considering Pestle.
Pestle is an abbreviation for political, economic, socio-cultural, technological, legal and environmental.
These are the six basic entities which will/may affect business but businesses have no control over them.
The PESTLE analysis
Political
Ricoh is a multi-national organization which has been serving customers since 1936 in over 180 countries.
Ricoh has working with the countries like US in assisting the public and private organization in addressing their
information security, sustainability effort, process improvement and cost optimization effort. The relationship
between Ricoh and US communities is amazingly positioned in such a way that it allows complete utilization of
digital technology to the organizations.
Economic
Ricoh is Japan based multinational company with the total worth of $21.5 billion (2010). It has constantly
gained over the years through the boons and banes of the business cycle. The major problem that Ricoh faces is
of the fluctuating exchange rates, the operating profit and liabilities are highly sensitive to the exchange rates as
most of the sales and production activities happen in countries like US, Europe etc. Even though Ricoh is
involved in hedging transactions but it requires a lot of planed procurement, production, logistics and sales
activities. Consolidated foreign currency exchange loss, net included in other (income) expenses for fiscal year
2011 increased by 2.1 billion to 6.9 billion from 4.7 billion for fiscal year 2010 (Ricoh, 2014) .This increase
was primarily due to the depreciation of the U.S. Dollar and the Euro in relation to the Japanese Yen.
Other major economic trivia faced by Ricoh is the oil price fluctuation which make it difficult for them to set a
single price as the cost of transportation and handling is changing. Such changes in oil prices adversely affect
the financial position and operation activities. Ricoh has taken a major step integrating its off-shore location to a
single headquarters which has helped them cut cost on the various product and saved them from certain
economic fluctuation.
Socio-cultural
Ricoh has been involved in the many countries and have been involved in the maintaining the social and
cultural balance in the form of products by supplying local language products and manuals and after sales
support.
Technological
To be in the digital printing market one has to constantly track the rapid change in the technology and Ricoh
success depends upon the ability to respond to these changes. Ricoh has been conducting research in
connections with optical technology, new material, devices and information technology. Ricoh has made
various satellite bases in countries like US and China to conduct R & D which is specifically concentrate on the
on developing products which are globally accepted. For fiscal years 2009, 2010 and 2011, Ricohs
consolidated R&D expenditures totaled 124.4 billion, 109.8 billion and 110.8 billion, respectively. Out of
the total R &D budget of 2011 i.e. 110.8 billion, 81.7 billion was used particularly for imaging and solutions
(Ricoh, 2014).
Legal
Ricoh has been constantly prone to unexpected legal and regulatory changes, and lack of sufficient protection
for intellectual property rights (Ricoh, https://www.ricoh.com/IR, 2014). Ricoh whole business depends upon
saving its intellectual property, Ricoh even though own a number of licensed patents and trademarks but still
believes that it is necessary and most important to obtain additional licenses for the third party use. Ricoh as
have to serve in more than 180 countries have to look to the government regulations and the way they operate.
Ricoh has been involving its employees in risk management schemes but to make sure they comply to these
schemes involves cost and thus increasing the cost and adversely affecting the cost of production.
Environment
Ricoh since its inception was concerned about the nature and the environmental changes happening around the
world like global warming, carbon footprint and etc... Ricoh had in cooperated an EMS (Environment
management system) which includes feedback of each essential process. Under the system the organization
promotes plan-do-check-act (PDCA).

Every year a sustainability report is published which provides insight about the environmental safeguard
schemes Ricoh has implemented Ricoh has been involved in the CSR (co-operate social responsibility) and
have promoted activities globally, they have maintained an ISO 26000 (Ricoh, https://www.ricoh.com/info/, 2014)


Internal Industrial Environment (Ricoh, https://www.ricoh.com/info/, 2014)
Reforming human resources management to meet the requirements of the next generation and creating a
vibrant workplace where employees can grow and take on challenges.
Ricoh believes in Developing a global mindset, Training programs including a curriculum designed to
develop a global mindset for all levels of employees, including new recruits, They are Recruiting people
who can play a leading role globally and create new value
Annual global HR conference
Development of employees who can take charge of new business, Career development support for
individual employees
They are Targeting foreign students and female students specializing in technical and scientific fields
(Ricoh, https://www.ricoh.com/IR, 2014)
Mergers and Acquisitions

Mergers and acquisitions were a major part of Ricohs business model. Every year they acquired one or
the other major firm and included it in its business.
Ricoh started this trend in 2003 by buying up the naming rights of CNE Coliseum in Toronto. In 2004
Ricoh acquired Hitachi Printing Solutions, Ltd and created a new company, Ricoh Printing Systems, Ltd.
In 2005 Ricoh bought the naming rights to the Coventry City Football Club which is now called
the Ricoh Arena. In 2007, Ricoh purchased IBM Printing Systems Division for $725 million and formed the
new Ricoh subsidiary, InfoPrint Solutions Company.
In February 2008, Ricoh partnered up with PrinterOn. This was followed by Ricoh announcing its
intentions of acquiring IKON Office Solutions for $1.6 billion in 2008.
Another major acquisition was with the Japanese optical glass-maker Hoya Corporation. On October 1,
2011, Ricoh acquired Pentax Imaging Corp. and renamed it to Pentax Ricoh Imaging Company, Ltd.

Porter Five Force

Bargaining power of suppliers: The bargaining power of suppliers is low since there are a lot of competitors in
the market. Due to the competition Ricoh doesnt have a lot of power in setting the price. Even though there is
exchange rate fluctuation Ricoh cant change their price every now and then. They have to bear those losses and
have to play according to the external market.
Bargaining power of customers: The bargaining power of customers is really high because if Ricoh change their
prices due to fluctuation in the prices then the customers will shift to their competitors. So customers have more
power and its really high.
New Entrants: There are many competitors in the market as there are many technological changes in the digital
industry HP and Samsung are coming with new products every now and then and to be part of the industry and
succeed they have to be adaptable to the technological changes
Substitutes: There are any cheap substitutes available in the market which offer more or less the same features
and have developed their own market to which Ricoh has many threats to deal and thus giving substitutes
advantage over the Ricoh.
Rivalry in industry: Ricoh has been facing the very high rivalry in the digital industry and because its a very
technologically challenging industry they have to improve themselves every time and even extend them ahead
to achieve the competitive advantage eg. Canon

Financials
If we look at the report of 2011 Ricoh made several announcements to reduce their costs. These were the
several steps that Ricoh plans to take:
Ricoh plans to cut 9% of its workforce over the next three years.
Cutting 10000 workforce by 2014
Ricoh said it expects the steps will cost 60 billion yen ($733 million) by next fiscal year
Boost its operating profit by 140 billion yen in three years
Now if we look at the events of Ricoh there were 2 major external environment reasons dude to which the
profits of Ricoh slipped. These are the following reasons:
Stronger yen
After the March 11 earthquake in northeastern Japan damaged its facilities.
There was one more reason which was not external and that was that the number of workers increased by
30,000 in the past three years through overseas acquisitions.
Now lets look at the two external reasons in detail:
The exchange rate was changing. Yen was appreciating and their currency was becoming stronger with respect
to dollar and it was appreciating very quickly. So the amount they were getting in Japan after sales of printer
was becoming less and less. This affected their profits very badly. If we look at the exchange rate graph it looks
like this:


Fig: Exchange rate graph

Now if we look at this graph it is V shape; so the Yen appreciated in 2011 and by 2014 it depreciated. So the
loss they made in 2011-12 because of the exchange rate fluctuation they would recover that in 2013-14 because
of the same reason.
Now lets look at what impact did earthquake had on the profit books of Ricoh. Earthquake struck Japan in
2011. Ricoh had a major impact on sales because of the earthquake. A lot of Rico factories were destroyed in
the Earthquake.
1.7 billion yen loss in operating income.
Net income during this period was minus 7.3 billion yen.
If we look at the balance sheet of Ricoh during that period it looks like this:

Fig: Balance Sheet Ricoh from April 2011 to March 2012

The net income is which is most important to any company. As we would see from the following graph the net
income of Ricoh dropped severely in 2012 because of the earthquake. The following graph show net income per
share of Ricoh.

Fig: Net income per share of Ricoh

The company reputation is by how much dividends they give. Ricoh has done exceptionally well in this field.
Even though their profits declined in 2012 because of earthquake, they never compromised in giving dividends.

Ricoh Group's policy to maintain stable dividend payments. A mid to long-term payout ratio target of 30%
Present Scenario:
If we look at the present scenario they have again started to make profits. The main reason was thhe
depreciation of currency as explained before. For the same printer they were able to get more of Yen in into
Japan.


Fig: Balance Sheet Ricoh from April 2013 to March 2014
References
Ricoh. (2014, feb 19). https://www.ricoh.com/info/. Retrieved from www.ricoh.com: https://www.ricoh.com/info/
Ricoh. (2014, feb 19). https://www.ricoh.com/IR. Retrieved from www.ricoh.com: https://www.ricoh.com/IR/risk.html