Effective Management of Office Document Output Systems

1. Gartner @ XplorEffective Management of Office Document Output Systems Andrew Johnson Managing Vice President

2. The Opportunity and Dilemma • Document output and management spending worldwide is $180 billion • Represents 1 percent to 3 percent of most businesses’ revenue • Savings of 10 percent to 30 percent are common when businesses actively manage products and processes • Quest for savings is opportunity for businesses and threat to some vendors

3. Worldwide Spending on Devices is Slowly Declining

4. Worldwide Copier, Printer and Fax Market Forecast Scenarios by Major Issue Best Case Most Likely Worst Case Political settlement in Iraq or the Iraq War concludes in the Iraq War is prolonged and has war ends quickly without second quarter of 2003 without many negative global Economy and Politics global consequences. global consequences. consequences (high oil prices). Economic recovery follows Economic recovery will follow in Economic recovery is delayed soon after. the second half of 2003. into 2004 or later. Normal Replacement First half of 2003 Second half of 2003 First half of 2004 Cycle Resumes Rapid adoption of office color Modest adoption of office color Restricted budgets prevent printer, copier/printer. products in external-facing color output in all but the most “Universal” printers become documents only. important documents. Inkjet Product Mix popular as color becomes a printers are removed from offices. Color usage in internal Color and familiar part of many internal MFPs documents is still a novelty. office documents. MFP replacement strategy MFP prompt reduction in fleet MFPs boost ASPs and create keeps fleets of copier, printer sizes suppresses demand for incremental spending on and fax stable — boosts ASPs. Single-function products. services and software Vendors increase ASPs in face ASP declines continue with Products are seen as “commodity” of stronger demand by selling some positive impact on — sparks price war among Pricing richer configurations. demand. vendors and channel. U.S., Western Europe and Japan Two out of three developed Only one of the developed meet expectations. markets meet expectations. markets meet expectations. Regional Market Latin America, China and Eastern Mixed success in developing Developing markets struggle. Issues Europe demand exceeds markets Expectations.

5. Shift in Client Issues • Pre-2002 — Most clients searching forproduct advice • Speeds, feeds and bid review • Separate from content management initiatives • Spring 2002 — Most clients searching for different advice • Cost savings • Asset consolidation and optimization • Vendor selection • Solutions linked with services and software

6. By 2005, the number of copiers, printers, MFPs and fax machines installed in businesses in developed markets will be 10 percent lower than in 2002 (0.8 probability). Strategic Planning Assumption

7. Document Cost-Saving Model Technical Solution Business Solution Consolidation and Standardization Automation, Centralization Alignment of IT and Business S a v i n g s O p p o r t u n i t y Solution Management Optimization Product Optimization Process Optimization Time and Effort

8. Document Cost-Saving Model Technical Solution Business Solution Procurement, FM IT Management CIO, LOB C-Level or LOB Board Level Consolidation and Standardization Automation, Centralization Alignment of IT and Business S a v i n g s O p p o r t u n i t y Solution Management Optimization Product Optimization Process Optimization Time and Effort

9. Document Cost-Saving Model Technical Solution Business Solution Assessments, MFPs Content Management Tools Management Services S a v i n g s O p p o r t u n i t y Solution Management Optimization Product Optimization Process Optimization Time and Effort

10. Who Can Help Deliver the Savings? Technical Solution Business Solution P a r t n e r s h i p s Services Software Vendors Hardware Vendors Assessments, MFPs Content Management Tools Management Services S a v i n g s O p p o r t u n i t y Solution Management Optimization Product Optimization Process Optimization Time and Effort

11. Gartner Research Agenda • What is the size of the market? • What is the competitive structure of the market? • Which technologies will play a prominent or disruptive role? • How do we cost-effectively plan our document output devices around current and future road maps? • What product type and configuration should I choose for each user type? • What are the key criteria to determine if a vendor meets our organization's requirements? • Which contract, relationship and vendor management practices lower the total cost of ownership? • What are the trends of the color segment of the market? • What are the promises and pitfalls of outsourcing?

12. Agenda • Ken Weilerstein, Gartner Research Director • Best Practices for Copier, MFP, Printer Fleet Management • Malcolm Hancock, Gartner Principal Analyst • How to Put Color in Your Office Documents — Effective management strategies that deliver the value of color documents, without all the cost • Peter Grant, Gartner Principal Analyst • Output Outsourcing: Promises and Pitfalls of Turning Over Document Output

13. Agenda • Vendor Executive Panel • Get your questions ready for IBM, HP, Xeroxand IKON • User Panel • A reminder of the real world • Ralph Witcher, Gartner Director,Software Specialist • Vendor Selection Software Tool