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Tech Data MPS Seminar

Tech Data MPS Seminar. Tom Callinan callinan@strategydevelopment.org 610.527.3317. Agenda. Defining MPS Why enter the MPS space How to leverage existing structure The value proposition The assessment Critical areas. What is Managed Print Services.

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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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