Wednesday, December 22, 2010

Managed Print Services is Dead - "...alas poor MPS-Guy...I knew thee well..."

12/2010

I love it.

Just as everyone figures out how to spell MPS, industry pundits kill it.

Photizo called heavy growth rates in MPS Engagements through 2015 - of course this was back in the "olden days" - 2009!

Last year at Lyra, consultants and statisticians explained that we will never return to the same levels of units (copier) sold, pre-2009.

Do you get that? Does anyone?

Why yes, some do...some have all along. HP buys EDS, Xerox takes ACS.

Why paint MPS all black? Why kill MPS after just three short years? Why blacken the Sun?

I've said it before. Change releases fear and fear motivates.

Contrary to what the Imaging Intelligentsia bloviate, we are not witnessing the beginning of the End Managed Print Services - we are seeing the last gasp of "Print Services"(it's the "M" - stupid)

Two informational items released this month:

1. The BTA revealed the results of their "MPS Survey" and

2. InfoTrend releases a teaser for their MPS Market MPS Study, "Managed Print Services Revenue to reach market saturation by 2014."

BTA Study -

What is interesting to me about the BTA study is the small size of the sampling - 93 respondents - and the quotes.

At this time in our MPS evolution, one would think more positive feelings would abound. Yet there aren't and I know why.

Here are a few quotes, from some of the 93 people who responded:

“I am not impressed with the MPS concept. It requires too many resources
with little, if any, payoff. The traditional A4 strategy has more hope for a small independent dealer.”


“MPS is the same thing copier dealers have been doing for years. The printer guys are just trying to steal our business with a different name than CPC. The only way to win (printers) in a competitive situation is with third-party toner and parts.”

“I think that the MPS companies are selling the program short and doing themselves a disservice. The initial sales pitch for MPS is that it will make us millions on printer revenues.

We are not finding that to be the case today.

However, the MPS program is great for gathering information on potential accounts and for developing a copier/MFP/MPS sales pitch. It may also prove to be a money-making venture for printer-only business down the road. As with all new opportunities, you need to separate the steak from the sizzle.”


To quote Photizo, again - 50% of the people who get into MPS, fail. There is a BTA figure floating around closer to 75%. Is it any wonder?

Why?

Many reasons, but two for sure.

1. The definition of MPS
2. Those asked were simple, copier dealers

What is MPS, again?

When you define MPS as CPC, as the "same thing copier dealers have been doing for years...", you're in the dark and will be left behind.

If you define MPS as a new marketing method leveraged to land more equipment, you're in the dark and will be left behind.

Copier Sales People Destroy Managed Print Services Opportunities:Daily

I wrote the above post over a year and a half ago, June, 2009 and was based on a real-world, in the field occurrence. I was in the same situation back in August with a different prospect and recently signed a client after a failed PagePack experience.

All anecdotal, but the above quotes bear out my belief - the copier channel is not capable of supporting Pure MPS.

Most the existing copier guys expected to easily "roll" MPS into or "bolt" MPS onto existing sales/support infrastructure.

Less than half-way in, they discover, "...It(MPS) requires too many resources
with little, if any, payoff..." and are probably in the 50% failure group.

Here's the clincher - if MPS is the same as CPC, then shouldn't a copier rep get commissions on service agreements? Recurring commissions, no less?

This, to me, is one of the biggest hurdles copier-dudes have - supporting MPS engagements with the same, decade old, CPC sales/infrastructure/commission structure.

Huh.

INFOTRENDS

So, people talk "offline" about MPS - people who actually DO MPS vs. comment on MPS.

Friends of mine.

And of course when anything really big hits the MPS market, we talk.

So we talked about the 'new' findings displayed in the INFOTRENDS report.

Below is a collective response to and discourse around, the report:

"...I've had a chance to digest this and its just not sitting well with me at all.

How does an industry go from 5% adoption at the end user level at the beginning of 2010 to saturation in 4 years? This isn't the iphone right?

The premise is supplier availability creating market saturation in 4 more years.

If you run with that premise you can discern only one of two things:

1. demand is lower than these guys have originally projected
2. the channels who were totally clueless, all of sudden get a clue

The MPS Solution Product Life Cycle is in its early stages, particularly in the SMB Market.

Overall its still classified as:


Upward revenue trend


  • High competitive differentiation



  • Margin preservation



  • Solution/sophisticated based sales cycle



  • Technologies and framework still in early stages as demand evolves and becomes more defined


  • So in 4 years this will all invert?

    How will this happen when:


    Adoption rate at the reseller level is low


  • Channels dont know how to provide this solution on a global scale



  • The diffusion of this solution information at the end user level is still low



  • What event is going to occur that changes this?  


  • I think this is a fear based ... that is loosely founded. I could go on but I question the motivation of this report..."
    - Kevin DeYoung, President and CEO, Qualpath

    Succienct -

    Bottom line, it's the 'M' in MPS that is most difficult and makes the difference.




    Click to email me.


    Reactions:

    3 comments:

    1. The truth is MPS is quickly fading into oblivion. What it all boils down to is who can best serve the customer's equipment needs. MPS was a nice gimmick or buzzword for the industry's sharks to use for a short period of time. The game is over.

      ReplyDelete
    2. Great read, Greg! Very thought provoking as usual.

      Is this Merry Christmas or Bah Humbug? ;-)

      Ken Stewart

      ReplyDelete
    3. Well done. The dinosaurs roaming the earth want dearly, to preserve their business model and compensation plans. So we take the hammer and pound the square into the round hole and ask why it failed? Combine this with the delusional relationship that reps believe they have with procurement and that printers software and accounting are value add...nice. The King is dead.

      ReplyDelete