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01732 759725
Managed Print Services
Cost is still important – I don’t
want to minimise that – but
it becomes a lot more about
‘What can you enable me to
do?’, particularly when it’s
more than just managing a
fleet and actually implementing
workflow or business process
enhancement. ‘How can you
fundamentally help me make my
business better? If we outsource
this how will it make me be
better at what I do?’ The focus
shifts more towards adding
value and additional capabilities
rather than just reducing costs?
This requires a change in
customer thinking.
PrintIT:
MPS vendors used
to pride themselves on high
contract renewal rates. Is this
still the case, or is there now
more customer churn?
Crowley:
We are definitely
seeing more customer churn
and it’s really being driven by
two things. More customers
are saying ‘Look, I want you
to offer more than just fleet
management. I want advanced
document services as part
of my MPS contract. I’ll sign
the first contract with you,
and that can really be about
fleet management, but the
next contract has to be about
advanced document services’.
Vendors come in and sell their
advanced document service
capabilities and everyone is
happy. Then what happens is
at the end of the first contract
they say ‘Gee, we’ve got the fleet
managed but I’m not making
any progress on advanced
document services. We’re going
to give you another contract
period to do this’. When the
vendor still doesn’t achieve this,
they say ‘Well, if all you are going
to do is reduce my costs then
this is a pure RFP procurement.
I am going to put it in an RFP
and let purchasing handle
it’, at which point it becomes
commoditised and is all about
the cost per page. At this point,
customers turn and say ‘If you
can’t move me forward and it’s
just about managing the fleet, I
can do that’. This creates churn
through missed expectations.
The other thing that causes
churn is summed up by
something a vendor said at one
of our conferences: ‘If we really
understand what the customer
is trying to do when we walk in
first time and we execute well on
that we have an almost 100%
renewal rate. But when we
walk in and we’re just pushing
a programme and don’t really
understand what the customer’s
objectives are our renewal rates
fall down to 50%.’ Some vendors
treat MPS as a programme and
don’t focus on understanding
what the customer needs.
These people don’t hang on to
customers because they never
really knew what to deliver in the
first place.
PrintIT:
Who is spearheading
the drive to business process
optimisation: the vendor,
dealer, customer or IT services
provider?
Crowley:
I was having this
conversation with one of the
major OEMs (original equipment
manufacturers) and they said
‘Initially, we started with the
concept of let us help you move
into this advanced document
services space and customers
bought into it. Now we are
finding the more of that that we
do, the more the customers are
driving us’. I think that’s really
what’s happening. Customers
are saying ‘I’ve heard all the
marketing pitches, now here’s
what I need’ and they are
very focused on document
solutions and improving how
their business operates. It’s
very much being driven by
customers now.
PrintIT:
Are IT services
companies continuing to move
into MPS? If so, what share of
the market do you estimate
they have now? And what is
their preferred approach –
developing an MPS capability
themselves, partnering with
an MPS provider or acquiring
an MPS provider?
Crowley:
We are seeing all
those approaches being tried.
In Europe, IT providers still
have a pretty small share, but
here’s what I think is going to
happen because we have seen
it happen in North America.
About two years ago, a lot of
OEMs started saying ‘Hey,
you’ve got to get into managed
services’. At that time, many
dealers had agreements with IT
service providers to go in to a
customer together: one would
provide MPS and the other
would provide IT services. After
that, dealers started offering
managed services. Now I have
more and more IT resellers
coming up to me and saying ‘You
know what, I used to partner
with a dealer until I found out I
was competing with him. Now
I actually offer MPS because I
have to. It’s defensive – it leaves
a door open if I don’t’. In the
US, IT resellers are starting to
come into MPS in a much bigger
way, if nothing else for defensive
reasons. I think that will happen
in Europe – probably in the
UK first – but I don’t think it’s
happening yet. We are a year or
maybe a little more away from
it yet, but you will see that shift
start to occur.
PrintIT:
Why should an IT
director trust the guy who
manages their printers
with business process
optimisation?
Crowley:
Because in many
cases that person has been
dealing with documents that
are part of the core business
process. However, you can’t
go in as ‘the printer guy who is
now going to help with business
processes’: that doesn’t have
credibility. What you have to
do is say ‘I understand your
business processes, these are
the issues you are having and
here is how we can help you
make those processes better’.
That’s very credible. You need
a significant upgrade in sales
ability and delivery capability in
order to be able to do that.
PrintIT:
If resellers are to
prosper, will they have to
change the way they charge
for services?
Crowley:
We are seeing a
change in business models.
Fleet management will become
a pure utility model where the
customer says ‘You put the
equipment in and you own it and
I am just going to pay for usage’.
That utility model is going to be
very common. You are also going
to see models where a lot of the
contract revenue comes from
software fees and professional
service fees. Companies will say
‘We will implement this system
for you; we will manage it; we will
store your documents securely
and remotely; we will provide
all the workflow elements. We
are not going to charge you
anything upfront, we are just
going to take one hundredth
of a cent per page to handle
document repositories, to move
documents around etc.’. That
model is relatively new but it has
a lot of attraction for customers,
as they don’t have to buy and
manage a lot of infrastructure
and assets. Look at salesforce.
com. A company can go out and
buy CRM databases for much
less than they pay salesforce.
com, but they don’t do that. Why
is that? It’s because salesforce.
com gives them scalability and
flexibility: you add a seat, you
drop a seat; your data’s there,
it’s secure and it works. That’s
the model I think we will move to.
To find out more about managed
print services, book a place
at Photizo Group’s Transform
Global 2014 conference, taking
place in Louisville, Kentucky on
June 2-4 2014.
Visit http://
conference.photizogroup.com
for more details.
Need help knocking your
printer fleet into shape? Take
a trip to Kentucky and Photizo
Group’s Transform Global MPS
conference.
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