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Tech Data MPS Seminar

Learn how to leverage existing infrastructure and control document output costs with Managed Print Services (MPS). Discover the value proposition, assessment process, and critical areas for success.

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Tech Data MPS Seminar

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  1. Tech Data MPS Seminar Tom Callinan callinan@strategydevelopment.org 610.527.3317

  2. Agenda • Defining MPS • Why enter the MPS space • How to leverage existing structure • The value proposition • The assessment • Critical areas

  3. What is Managed Print Services • Managed print services (MPS) is defined as an end-to-end solution that provides everything a company needs to control document output costs: An initial output assessment, hardware redeployment or acquisition, pay-per-use output that includes supplies and service, through ongoing assessment of the contract and as-needed optimization.

  4. Definitions • Cost-per-page (CPP) is a contractual relationship with the customer that includes toner, maintenance kits, parts and labor • “Print management light” • Based on a per print charge • Usually on VAR’s paperwork • Print management includes all aspects of a CPP agreement plus equipment • Usually written on a lease

  5. Why MPS • Print output is 7X copied output • In 2002 it was 2.5X • Printers average 3,000 prints per month, $48 in supplies and service • The average employee to printer ratio is 4:1 • A 300 person office has 75 printers producing 225,000 monthly prints for $3,600 per month in recurring revenue

  6. Why MPS • Desktop printers are fast! • HP 4015n at as low as $1,099 (52 PPM) • Desktop printers are convenient • Pulling output away from copiers • Copier companies view printers and software that drives prints as their expansion market • Canon, IKON, Ricoh, Xerox

  7. Trends mandating change: Convergence of channel players Printer Companies Direct: HP, Dell, Lexmark Traditional Copier Dealers/Direct Operations From Co-existing in Accounts to Competing VARs Printer Resellers Aftermarket Resellers & Service Providers Competition for pages is creating pricing pressure on page costs

  8. Trends impacting printer fleets • Organizations spend 1 – 3% of annual revenues on output technology fleets** • Companies spend $213 per employee per year in direct hardcopy costs (toner/ink and maintenance)+ • 23% of all IT / help desk calls are printing/copying related** • This does not translate into happy customers • 55 % of network traffic is printer related* +Source: Gartner Group, *Source: Information Week**Source: IDC

  9. Building the case for MPS • Printer volumes are increasing 9% in B&W & 19% in color(11% overall) annually * • B&W copier placement declined by 9.2% in 2006 (to 1,277,346 units)** • Segment 1 had a very steep decline (45.2%) ** • 60 % of all paper documents originate at the printer*** • 70% of copied documents start out as printed originals of an existing electronic document*** • 50% of imaging fleets are over five years old*** • Coupled with climbing print volumes, the demand on aging fleets requires increased service and support calls *Source: Information Week, **Source: InfoTrends***Source: The Gartner Group

  10. What are the benefits of MPS • Converts unknown variable costs into known fixed costs • Eliminates capital expenditures • Reduces help desk calls • Reduces vendors and invoices • Reduces cost by an estimated 10% - 30%* • Reduces hardware downtime and hence improve employee productivity *Gartner Group

  11. How to Leverage Existing Structure

  12. Territory design • Start with 100 accounts per territory • Design list managed vertical territories • Mixture of current and net new accounts • Businesses with minimum of 40 printers • 150+ employees • High volume or high color usage may require fewer printers

  13. Vertical Markets Specific Health care Pharmacy Legal Higher Education Insurance Aerospace & Defense Government Graphic Arts* 1.5B Pages *200X Size Shown Financial Services Manufacturing Business Services Real Estate/ Mortgage Architecture & Construction Retail K-12 Transportation Communications Energy Religious/Nonprofit Entertainment Common Low Document Intensity High

  14. Buyer motivations & typical pain points • IT Manager’s Pain Points • They don’t like dealing with printers • Supplies and maintenance are reactive, resulting in emergency calls • They have no document technology strategy • With an MPS solution, the IT Manager will be happy because: • They can outsource printer service, a nuisance area • They can improve end user experience • They free up time for more strategic projects • There is no additional cost to service

  15. Buyer motivations & typical pain points • CFO’s Priorities • ROI • Cash Flow • SG&A expense • Strategy to identify and control costs • With an MPS solution, the CFO will be happy because: • They can maintain or reduce their current fleet without adding unnecessary hardware • They can identify imaging and output costs and how much they are printing • They can work with you to develop a cost reduction strategy for their imaging and printing fleet and permanently reduce their budget for IT infrastructure

  16. Buyer motivations & typical pain points • Purchasing Department’s Pain Points • Reducing year over year expense • Reducing the quantity of vendors to manage • Reducing emergency orders • Reducing inventory • With an MPS solution, the purchasing department will be happy because: • You will work with them over the long-term to reduce year over year spending • You will substantially reduce the quantity of vendors • You assume responsibility for inventory

  17. Steps of the MPS Sale • First appointment / Value proposition • Objective assessment • Strategy review • Proposal • Implementation • 30-day review • Quarterly reviews • Ongoing analysis

  18. Value proposition for MPSAreas of pain

  19. Needs analysis of print environment • Expense that is not quantified or managed • Multiple vendors • Supplies • Service • Equipment • Ad hoc asset acquisition • No consultation on printer selection • No consideration to output environment

  20. Needs analysis of print environment • Involvement of multiple departments that overlap output responsibility • IT has printer acquisition, help desk, software and service • Purchasing has copiers and fax • Copiers are connected as printers (IT) • Fax servers are replacing fax machines (IT) • Purchasing buys printer supplies

  21. Needs analysis of print environment • Multiple invoices • Multiple vendors • Transactional approach • IT / helpdesk required to handle printer issues • Not viewed as value add • Not fun

  22. Target needs analysis • Identify and quantify total cost of operation • Reduce to one vendor responsible for entire output fleet • Strategic approach to asset deployment and replacement • Handle all printer related issues • Single interface to internal departments • One monthly invoice

  23. The next step is to assess the current document technology environment

  24. Objective Assessment • Device populations and related monthly volumes should be accumulated by category, including printers, copiers, faxes, scanners and MFPs. • Identify areas of inappropriate asset allocation • Workgroups where applications do not match existing technology • Opportunities for workflow innovation with MFPs

  25. Objective Assessment • Inventory toner cartridges and maintenance kits to determine value and carrying costs • Identify hours per month IT spends on printer maintenance • Identify vendors by name so you understand pricing and quantity • Contractual relationships with current vendors

  26. Mistakes during MPS learning curve • Don’t conduct assessment without top-level buy-in • Director of IT; finance director; purchasing director • You need an advocate and agreement on pain • Avoid enterprise-wide assessments until you gain experience (150+ devices) • Takes too long to conduct • Extends the selling cycle • Too much change and risk • Easiest decision is to maintain the status quo!

  27. Critical Areas • Technicians / Service • Marketing Materials • Technology / Tools • Finance / Operations

  28. What You Need to Implement an MPS Strategy • Understand pros/cons of OEM & 3rd party • Service and sales training • Parts source • White papers • Brochures • Case studies

  29. What You Need to Implement an MPS Strategy • Rapid Assessment Key (RAK) • Value proposition presentation • Digital camera • Access to printer specifications • Proposal Templates/Generator • Quarterly relationship review template • CPP Contract • Leasing/Financing

  30. What You Need to Implement an MPS Strategy – Finance Relationship with leasing company that can bill CPP Billing system for CPP base plus overage Dispatching program

  31. Critical Areas Technicians/Service Marketing Materials Technology/Tools Financing Tech Data Relationships TD On Call (service/training) Computer Exchange (parts) TD Agency FM Audit IBM Leasing Great America Leasing US Bancorp In Summary

  32. Training • BTA Print Management Workshop • www.bta.org • Education and certification

  33. Questions? Thank You Tom Callinan www.strategydevelopment.org 610.527.3317

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