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© 2008 InfoTrends, Inc. www.infotrends.com
Managed Print Services DynamicsMoving from a MIF focus to a page capture focus
Zac ButcherDirector
Friday May 15th, 2009
2© 2008 InfoTrends, Inc. www.infotrends.com
Boston
UK
TokyoBeijing
InfoTrends
Industry analysts and consultants focused on consumer imaging, office document technology, production printing and publishing industries.
Focused Credible Responsive Visionary
3© 2008 InfoTrends, Inc. www.infotrends.com
Office Document Technology
Printers, MFPsScannersWorkgroup softwareSuppliesProfessional-Managed Services (MPS)Enterprise software
InfoTrends Practice Areas
Consumer Imaging
Production Printing & Publishing
Digital camerasPhoto printingCreativity toolsManagement & sharing
Printing systemsWide format printingWorkflow softwareOutsourcingPaper & consumablesSpecialty/industrial
Serving technology vendors, service providers, large corporate users, and investment firms
4© 2008 InfoTrends, Inc. www.infotrends.com
Agenda
• Market Trends
• What is MPS?
Definition
MPS Methodology
• MPS for the SME/SMB customer
• MPS Competitive Overview
• Summary and Closing Thoughts
6© 2008 InfoTrends, Inc. www.infotrends.com
The World Changed in 2008 ………… 2009-2010 Trends
More challenging to generate revenue, customer expenditure constrained
Investments must demonstrate tangible short-term savings and/or impact business growth
Increased awareness and willingness of business to embrace ‘Green’ and the CSR agenda
Projects needing to demonstrate positive ‘Green’ impact without incremental cost
New opportunities emerging but so too are new competitors from related fields
Customer desire to improve productivity and reduce complexity/admin mirrors other IT sectors
World unlikely to go back to 2007
7© 2008 InfoTrends, Inc. www.infotrends.com
Key Trends In Office Imaging Device Market
• Vendor focus shifting from “hardware placed” to “pages captured”
• Increased penetration of A4-size MFPs
• Business looking for tighter control of document output
Effective device utilisation, reduced costs, single-source supplier, minimisation of environmental impact
• Fewer ways to differentiate hardware; the real differentiator will be services
• Document solutions will be the key drivers in capturing pages and pulling device placements
• Economic environment resulting in longer device life
• Capital expenditure under scrutiny across the board
8© 2008 InfoTrends, Inc. www.infotrends.com
Customer Trends in the Digital Imaging Industry
• “Circa 70% of European organisations surveyed lack an accurate understanding for the total cost of document communication starting with the output produced in the office” (InfoTrends , cross-services assessment)
• A company spends on average 6% of its total annual revenues in document management – including hardware & supplies” (InfoTrends, Assessing and Benchmarking Document Costs)
• For every dollar spent on assets, InfoTrends estimates that $9.40 is spent on soft costs, such as IT support, administration and document management” (InfoTrends, Moving Toward More Effective Print Management)
• The associated costs of paper have been estimated to be as much as 31 times the purchasing cost” (Solid Waste Management Coordinating Board)
• Economic conditions resulting in spend being deployed on efficiency improvement and cost cutting measures
• Environment ally positive initiatives, with zero financial cost impact, resonating with businesses looking to reduce carbon footprints as part of CSR initiatives
9© 2008 InfoTrends, Inc. www.infotrends.com
CAGR 6.08%
CAGR 1.50%
CAGR -8.76%
CAGR 4.73%
Western Europe Laser Device Forecast 2008-2012(as at Q3 2008)
10© 2008 InfoTrends, Inc. www.infotrends.com
Western European Office Laser Images (Billions)
This is a massive number of images and pages (even in duplex)
12© 2008 InfoTrends, Inc. www.infotrends.com
Fleet Optimisation
MPS – Why is it Different?
DISTRIBUTORDISTRIBUTOR
DIR
EC
T S
ALE
SD
IRE
CT
SA
LES
RESELLERRESELLERBUSINESS BUSINESS PARTNERPARTNER
SYSTEMSYSTEMINTEGRATORINTEGRATORRETAILRETAIL
Home/SoHo SoHo / SMB SMB SMB / ENTERPRISE
MANUFACTURER / VENDORMANUFACTURER / VENDORAnalogue B/W Enabler Bus.
Digital Colour Solutions Led
Connectivity Convenience Colour
Managed Print Services
13© 2008 InfoTrends, Inc. www.infotrends.com
MPS – Becoming the Only Fish in the Customer Pond
• The only fish in a large pond • The only fish in a small pond
Enterprise
SME/SMB
14© 2008 InfoTrends, Inc. www.infotrends.com
So What is MPS?
• A managed print service engagement is likely to embrace hardware, software, supplies, consultancy and on-going services across the entire print environment of the client organisation.
• Assessment services, strategic planning, fleet management, technical support, hardware placement, workflow design and strategic management services provide revenue opportunities for the provide
A Managed Print Service is a professional service offering that utilises the specialist skills and knowledge of the provider to design, implement and then manage a customised document strategy and print environment for the client.
15© 2008 InfoTrends, Inc. www.infotrends.com
Percentage of Revenue spent by industry
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
11%
12%
13%
14%
15%
Telecommunications 6.28%
Petroleum refining 1.25%
Transportation 2.36%
Healthcare & Pharmaceuticals 8.56%
Computer/data services 10.24%
Diversified Financials 6.84%
Govt. Operating Budgets 15 - 25%
Advertising & Marketing 14.79%
Average 6.1%
Industry Sector Print Costs(Commercial, Office, & Production combined)
• Documentmanagement
• IT supportand infrastructure
• Administrationand procurement
90%
10%Actual print cost
Costs ofmanagingdocument
lifecycle
For every dollar spent on assets, InfoTrends estimates that $9.40 is spent on soft costs, such as IT support, administration and document management
Moving Toward More Effective Print Management, June 2007
Source: Examples taken from ALL
Associates Group.EDAM 2005 industry
sector research
MPS – Addressing the True Cost of Printing
16© 2008 InfoTrends, Inc. www.infotrends.com
What Does MPS Cover?
Managed Print Services
Break-fixService
JustCopiers
JustPrinters
MFP’s Production &Print Room
Maintenance WorkflowSupplies
Replenishment
DocumentAssessments
FacilitiesManagement
Optimisation
FlexibleBilling
Help DeskSupport
RemoteDiagnostics
ChangeManagement
A3 / A4
Multi Vendor Support
Training
Monitoring
DocumentManagement
Customisation driven by customer’s unique processes, infrastructure, requirements and elements selected from the vendor MPS toolbox
18© 2008 InfoTrends, Inc. www.infotrends.com
Managed Print Services Tools
One-time usage Continuous usage
Assessment AuthenticationCost Recovery
Data Consolidation and Optimisation Reporting
Monitoring Service Automation & Back Office
Accounting
19© 2008 InfoTrends, Inc. www.infotrends.com
InfoTrends Document Solutions Categories
• Remote diagnostics
• Device relationship management
• Service Automation
• Print tracking
• Document security
• Print Authentication
• Scan hardware & software
• Document conversion
• Workflow solutions
• Document repositories
• Project management tools
• Retrieval & Collaboration tools
21© 2008 InfoTrends, Inc. www.infotrends.com
Customer Segmentation and Opportunity
• Enterprise customers have been serviced well by larger Global Services organisations
Xerox Global Services
HP Global Services (EDS)
Williams Lea
• InfoTrends believes the mid-market shows a significant opportunity as they face similar challenges to Enterprise customers
• Vendors are now focusing on addressing the mid market
22© 2008 InfoTrends, Inc. www.infotrends.com
SME/SMB Customer Engagement Scenarios
• Customers wanting entire fleet replaced, both copiers and printers – extremely rare
• Customers wanting to keep copiers but want to replace entire printer fleet – very rare
• Customers that don’t want or need any products replaced. They want to keep existing copiers and printers but want greater costsavings – becoming more common but still relatively rare
• Customers that want to replace copier fleet but want to keep existing printers – most common but usually only happens towards the end of lease cycle
• Customers that don’t know they need help and do not have a need to replace anything at this time – most common scenario
23© 2008 InfoTrends, Inc. www.infotrends.com
A Key Strategic Decision in the SMB Space …………….
Transformation (MIF)• Sell more of our hardware
• Lock in our genuine supplies
• Lock in our break-fix and preventative maintenance services
Transition (Pages)• Assist the client in designing,
implementing and then managing a digital document output environment
• Become a services provider delivering that which is in the best interest of the customer
MIF FOCUS:Chance of supplies business and
service revenue/profit
PAGE CAPTURE FOCUS:Control of supplies, service and
influence on future HW
24© 2008 InfoTrends, Inc. www.infotrends.com
A Fundamental Shift in Thinking …………….
• Switch fleet to our devices and then optimise
• Manage our new fleet
• Deliver our break-fix and preventative maintenance services
• We capture all pages within customer environment
• Locks out our competitors
• Customer benefits from cost saving, process improvement, etc.
• Take over management of client’s existing fleet
• Less intrusive for the client
• Less costly for the client – genuine customersavings from first day
• Customer gains value from existing assets and investments (ROI)
• Opportunity to switch to our hardware comes at end of normal product life
• Deliver our break-fix and preventative maintenance services
• We capture all pages within customer environment
• Locks out our competitors
1. Replace end of lease copiers, keep existing printers2. Don’t know they need help, do NOT need to replace anything
Transformation model Transition model
25© 2008 InfoTrends, Inc. www.infotrends.com
3.3
3.5
3.5
3.5
3.6
3.6
3.7
1 2 3 4 5
Internal staff was not capable of performing theseservices
An internal staff would be too expensive tooperate
Wanted to have my technical networking, driverinstallation and device management software
managed by an outside company
Wanted a vendor that could provide meenvironmental offerings and processes
Wanted to have more flexible billing options fromONE vendor
Wanted to better understand my Print/Copyinfrastructure
Wanted to have our supplies managed by ONEvendor
Importance of Criteria for Engaging in Managed Print Services (2)Rate the importance to each of the following criteria to why you chose to engage in Managed Print Services?
N = 343
Very ImportantNot Important
Source: Professional & Managed Print Services Multi Client Study
26© 2008 InfoTrends, Inc. www.infotrends.com
47.7%
47.7%
50.3%
55.5%
57.4%
57.4%
69.0%
75.5%
80.0%
0% 20% 40% 60% 80%
Purchasing of Printers/Copiers
Installation and support of device managementsoftware
Networking of printers/copiers
Administration, management of Printers/Copiers
Printer/Copier help desk support
Toner or ink replenishment of printers/copiers
Installation of Printer/Copiers
Printer/copier maintenance
Printer/Copier repair
Percentage of Respondents
Services Included in Managed Print Services Contract (1)What services are included in your Managed Print Services contract? (Check all that apply)
N = 155 Respondents involved or familiar with Managed Print Services who are currently using Managed Print Services for their company
Multiple Responses Permitted
Source: Professional & Managed Print Services Multi Client Study
28© 2008 InfoTrends, Inc. www.infotrends.com
• Xerox turns on enterprise-class managed print services for small and medium-sized enterprises
• New Xerox Print Services enable resellers and their customers to reduce and control printing costs, regardless of device type and brand
• Uxbridge, UK April 22, 2009 – Xerox today announced Xerox Print Services, a new version of its enterprise-level managed print services tailored for small and medium-sized enterprises (SMEs). Xerox Print Services is a set of services and tools that will be delivered through its worldwide network of channel partners to help SMEs assess their current printing environment, fine-tune their printing networks for optimum performance, and then manage their printinginfrastructure – regardless of the manufacturer or device type. For end customers this results in lower print and copy costs, reduced IT support and increased office productivity across multiple print platforms. The offer is available immediately in Western Europe, with launches in North America and other countries to follow.
XPS – Power of Global Services for the SMB
29© 2008 InfoTrends, Inc. www.infotrends.com
• Xerox Print Services is an all inclusive approach. Customers only pay for the software and services that they use
• Xerox hosts the technology tools whilst the accredited partner delivers and executes the service
• Pricing is dependent on partner and customer assessment of existing versus desired future state of the print infrastructure
• Service available through accredited XPS resellers
• Low cost, low risk way for channel to move into MPS – a zero risk approach
XPS – Power of Global Services for the SMB
30© 2008 InfoTrends, Inc. www.infotrends.com
Canon’s Approach to MPS
http://www.canon.co.uk/MPS/index.asp
31© 2008 InfoTrends, Inc. www.infotrends.com
Ricoh Global Services
• Ricoh Global Services helps organisations gain control of processes and costs for document output
• Ricoh's Managed Print Services are available across Europe or from Ricoh Global Services globally from April 2009
• A Ricoh direct offering
32© 2008 InfoTrends, Inc. www.infotrends.com
Ricoh’s Channel MPS Offering (UK)
• Helen George, UK services marketing manager at Ricoh, says the impetus for print management is reflected in the fact 31 dealers have signed up for its @remote product in the past two months.
“It’s been taken up very well by the channel,” she claims. Some dealers have signed up because their customers have demanded it and they were keen not to find themselves locked out of their customer base. Others have been quick to understand the benefits in cost savings and revenue generation offered by managed print services. www.microscope.co.uk
http://asp.april-six.com/ricoh/076286/Flash_presentation.html
33© 2008 InfoTrends, Inc. www.infotrends.com
HP Smart Print Services (formerly PrintAdvantage)
• Targeting SMB Market through IT Resellers
• Reclaim lost revenue from third party supplies (remanufactured supplies) predictable supplies revenue and take over entire fleet of a customers print environment
• Customer Value Proposition is to save time and money by controlling printing costs, and improve productivity and increased customer satisfaction
• HP is aiming for 60% growth across EMEA for Smart Printing Services which, Hatfield admits, will be challenging, adding the UK will be pleased with 30%.
In a bid to boost its competitiveness against other vendors, especially the copier channel, on a cost per page basis, HP is heavily discounting its supplies business through the contractual channel.
“Customers can get particularly aggressive HP supplies pricing with managed print services through the channel,” Hatfield says. www.microscope.co.uk
35© 2008 InfoTrends, Inc. www.infotrends.com
Additional Printer Vendor Offerings
• Has the vision and can (and will) move very quickly to develop a full MPS offering
• Currently provides a range of tools to support the channel in moving into MPS
Assessment Consulting Tool
Cost Simulation Tool
SyncThru™ Admin (device management for IT managers)
CounThru™ 2 Pro (remote management for channel partner)
• Some sound local initiatives
KYOPrint Pack (UK)
KYOclick (DE)
• Appears to favour locally developed in country offerings
36© 2008 InfoTrends, Inc. www.infotrends.com
Vendor Provided Channel ‘MPS’ Overview
• HP’s ‘Smart Printing Services’
• Xerox’s ‘Xerox Printing Services’ and ‘Page Pack’
• Ricoh’s ‘@Remote’ programme and new ‘Click’offering
• Lexmark’s ‘Value Print’
• Samsung making progress
• Kyocera’s ‘KYOprint pack’ (UK)
38© 2008 InfoTrends, Inc. www.infotrends.com
Summary
• W. Europe hardware market down in 2008/2009
• Page growth set to decline (paper even more so)
• Copier vendors and channel have been providing managed copier services for many years
• Print vendors and resellers do not have copier legacy infrastructure so many programmes have been developed to enable click-charge, pay-per-page, pay-per-usage, with back-end vendor support and a revenue/profit share model
• Many things currently labelled as ‘Managed Print Services’
Characteristics/messages tend to be cost reduction, increased efficiency, automated supplies, inclusive service and reduced printing/minimised environmental impact
39© 2008 InfoTrends, Inc. www.infotrends.com
Closing Thoughts
• Managed Print Services is likely to mean different things to different clients
• Having a range of tools, techniques and processes available to support direct and channel engagements across the customer pyramid seems to be the direction most vendors are taking
• Much of what already exists in the vendor/partner portfolio can be leveraged - MPS is arguably a natural evolution of Solutions business
• The key strategic decision for vendors surrounding MPS appears to be whether to provide a full service offering (including consumables) for competitive devices
• Given the current economic outlook and where the World is likely to be at the end of this economic cycle, it appears that MPS is here to stay