Three Months of Managed Print Studies - A Summary

Aug, 2008 -

Interesting observations and conclusions.

My weeks have been filled with lots of “windshield time” traveling from client to client surveying output fleets and provide business analysis. 


To date, these examinations encompass over 1800 machines and thousands of users.

Without getting into details here are some interesting points derived from looking at ALL the studies as one-

The Numbers:

• The number of printers to copiers has been 8.2:1. In only one case, the ratio was 3.8:1.
• In a fleet of nearly 1,000 machines, the average monthly volume is 4,809 images/month/machine.
• Average Cost Per Copy, using equipment cost only, is 0.021919 for copiers
• Average Cost Per Copy, when combining copiers with printers is 0.0409

The Purchase or Lease:

• Most lease terms are 60 months with a sub-majority of leases having “strange” terms; 44 months, 42 months, etc.
• Lease details are unknown. It is difficult to obtain original leases and often, multiple lease agreements with unique termination dates exist.
• Although my numbers do not reflect laser printers, as a normal business practice, the laser printer fleet has been purchased and the copiers leased.

Organizational Impact – The copiers are either “invisible” or perceived as a negative influence

• In nearly every organization, the output devices, to the end user, have become “transparent”. They perform effortlessly and without failure.
• Common through all organizations is the interest level regarding change – positive interest. Indeed, when interviewed, most users are quite happy with their existing system, yet they express positive feedback when presented with the option of getting new equipment. This is expected; people like “new stuff”. But when delving deeper, the expected level of satisfaction relating to the copier is not high. The “bar” is set low. As an example, end users become familiar with “Broken Again” sign taped to the ADF. Or employees accept the fact that one of their peers is proudly known as the “copier guy” – the one who can always fix jams, avoiding placing a service call with the copier company.

Examples can go on and on – the underlying theme is - People don’t expect much from the copier; they do expect to have jams, the do expect to have challenges with copiers, with printing, with losing output, with having the unit down for days at a time.

Equipment Miss-Match, lease end, invoicing and meter reads

• There is no surprise that once actual volumes are compared to the recommended volume bands of each machine, clients’ experience shock, awe and then general frustration at having paid for capacity they never utilized.
  
• Add to this the ultimate frustration of trying to terminate a lease, even at lease end, and the complete experience is a nightmare.
• Invoicing, incorrect meter reads, service call management all contribute to a disdain for clients’ current position – all this beyond the costs.

Please note, that these are my personal observations on a small pool of studies. My opinions are based on my interpretation of the data and interviews.

Also, HP studies revealed years ago what I am finding today – for every copier, there are 8 printing devices and average monthly output per device is less than 10,000 images.

No surprises for me, plenty for the client – and now we get to see how responsive to change some will be – stay tuned.

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Copiers and Crime...This Stuff Can Not Be Made UP

Every now and then I run into things like this:

Man Accused Of Copier Thefts Suspended

In the article, allegedly, a politician who "...was to oversee the courts and the money coming into the courts."

Over three months, the Cops video taped him looting coin boxes connected to the city's Ricohs.

Hurd to Be Available To Partners

Hewlett-Packard (NYSE:HPQ) is offering its partners the prospect of a date with Mark Hurd.

One of my customers met with Hurd a couple of months ago. The meeting went very well.

HP, to me, has never been known as a "supreme" marketer. Well, let's just say that their marketing is no equal to their engineering prowess. They are very good engineers and creators of product(unlike Dell).

Hurd's attitude seems to be, "get out there and sell...!" which is refreshing and exciting at the same time...

More from the article by Craig Zarley, ChannelWeb


6:54 PM EDT Thu. Aug. 21, 2008
Hewlett-Packard (NYSE:HPQ) is offering its partners the prospect of a date with Mark Hurd.

The company is now formalizing a process to set up face-to-face meetings between solution providers, their customers and top HP executives, including chairman and CEO Hurd.

The strategy underscores Hurd's push to use the channel to extend HP's reach into the midmarket using the channel as an extension of HP's sales force. What's more, Hurd seems bent on using himself and his top lieutenants to help the channel win more business for HP.

Called ExecConnect, the plan allows solution providers to log onto HP's Website and submit a request to meet with Hurd or members of his executive team, said Tom LaRocca, HP's vice president of partner development and programs. "We are giving a structure and a formalization to our executive engagement program," said LaRocca. "In the last 12 months Mark [Hurd] has met face to face with over 100 partners."...

...LaRocca noted that HP now has a person dedicated to setting up the logistics of meetings between Hurd or his executive staff, including heads of the companies three business units: Ann Livermore at Technology Solutions Group, Vyomesh Joshi at Imaging and Printing Group, and Todd Bradley at Personal Systems Group.

"We want to continue to put partners in front of our executives and we want to give them a way to come into this program," he said.

LaRocca said partners can log onto the HP partner portal and submit requests or get more information on setting up meetings with HP executives."

Kearns Business Solutions Achieves a Monthly ROI of $8000 with Print Audit's Facilities Manager

Every single day, somebody can save thousands...

"Facilities Manager continually came out ahead with a lower overall cost of operation than a self-hosted solution," said Ken Stewart, the Director of Technology at Kearns. "Facilities Manager's hosted architecture is working extremely well for us."

Kearns' overall experiences with the Facilities Manager software have been released by Print Audit in a two-page case study, available for download from their site.

Before using Facilities Manager, Kearns was spending an excessive amount of time and resources on collecting meter reads and using out-of-date methods such as phone calls and faxed meter requests. All in all, the company wasn't accounting for approximately 10% of meter traffic due to inefficient processes and dated technology.

After working with Print Audit, the case study shows that Facilities Manager has reduced personnel time for meter collection by over 2500 hours per year and now yields an $8,000 return on investment. Kearns also rediscovered 200 printers previously thought to be decommissioned.


See the complete release.

The Death of The Copier SalesPerson

2008

Some feel the current model is broken. Now what?

Over at Ken's, a new contributor penned an article regarding the current state of copier salespeople.

Are Your Solutions Sales Stalled? We’ve Been Expecting You. - it is a good read.

I am going to borrow Max's definition of Solution Sales -

"so· lu· tion /

[suh-loo-shuh n]

–noun

Anything you sell other than just copiers. My copier proposal was half the price and I still got crushed! They said that even though we have been their copier vendor for the last 10 years, going forward it was in their best interest to give their business to a more knowledgeable company that can provide more than just copy machines but actual solutions to their business objectives.

—Related forms

so·lu·tion·al,

—Synonyms key, resolution."

I like "Anything you sell other than just copiers..." - my adjustment would be anything you sell in addition to the copier.

Semantics is all.

And then there is my article, Selling and U of M Football where I am waxing on in a veiled manner about dealing with the competition. 

 And the comment left by DocuNagurski struck me between the eyes.

So much so, that I feel the need to paraphrase it - so here it is -

"Great analogous approach to selling...comparing sales to a pounding grind for 3 yards forward in off-center fashion. Wow, those were the days in the copier biz...hmmmm...."

I can remember like it was yesterday: Makin calls, movin biz forward...methodically, but successfully. Down the field, we would go, not deviating much from our game plan of pounding our message until the customer gave in...wow, I miss those days!...

...much like the gridiron, we are tasked with the long solution-selling that demands great execution but requires the kind of hail-mary that even Doug Flutie would envy. 

Yes, once was a day in Ann Arbor lore that you could return a kickoff 100 yards for a touchdown (i.e. Seth Smith), and even though you were the new kid that never really complied with the ethical or managerial standards set forth by Sarbanes or Oxley, people would talk about your moves long after your poor revenue numbers garnered you a promotion to a coveted training gig...hmmm!

... you could refer to your future clients and wax poetically about how many product placements you had just on that street alone. I mean, not only do you have the most wins in your territory...but you have the highest winning percentage...history as well, and I'm not even going to tell you about my penetration rate...

Nope, today it's the 2-minute offense that requires the relationship sale, it's the off-campus mistake that only the service manager can fix, it's the overtime victory that nobody remembers because the CPC was so aggressive that we don't even want to take a meter reading from you.

Yep, those were the days of 3 yards and a cloud of dust...the days of solid and expected revenue from a well-executed plan...oh, thanks for the memories...you put it all in perspective for me.

This being said, I still think Red Grange would have been a great copier rep!"

***

Now, his post may be dripping with sarcasm, it may not - and that is the beauty.

In my post, I was talking about working against competitors, not clients. His take on my article was different - and I think it comes down to perspective.

In the copier industry, and in most "commodity" based selling, the customer IS the competition. - let that sink in...

That is to say, ALL vendors in the industry are trying to jam products into the End Zone and get the poor schmo of a customer to "sign on the line which is dotted!" So it is quite natural for somebody from that slant to see my ideas as "anti-client" - after all, that is their world and all is seen through their prism of perspective.

But, it is not singularly the world of the copier rep - it's our world in MPS as well.

Customers and future clients see things in this sense as well - it does not matter that they may have you pegged wrong, a customer is always on the defensive, on a "goal-line stand". The art in relationship building is to regain trust.

How do we do this?

That is the question.

If you liked this, try these:

The Death of The Copier Dealer

A Return to Selling

Managed Print Services - Everybody Sells

The Single Most Important Tool In Managed Print Services

Should HP Purchase IKON's PS Division? - Delicious!!

Click to email me.

HP Channel Execs: We'll Fund Small Solution Providers Too

Wow, I guess whining doesn't happen exclusively in the printer channel...

Looks like HP is opening the "wallet" for some HP partners as it has at CDW.

From an article at CRN - "Hewlett-Packard (NYSE:HPQ) channel executives said Monday that they are willing to fund SMB initiatives for small solution providers, including co-funding employee salaries, in an effort to capture more market share..."

This announced after a little ruckus occurred following HP's announcement to work with CDW.

But as Adrian Jones, HP's vice president and general manager, Americas Solution Partners Organization said, "...give us your ideas. Give us your proposals about how we can work together to co-fund and co-invest in that [SMB] segment and we will gladly listen and gladly work with you. ... we've invested in large partners. We've invested in small partners. And we are going to continue to invest in the SMB market. If we've got partners that feel that they can help us reach the SMB space, please give us a call."

***

I know this to be true. I know partners who work with HP in this capacity.

Is HP Doing What IKON Does?

HP Broadens Portfolio of Imaging and Printing Solutions for Enterprise Customers


HP today announced five new printing solutions – ranging from check printing security to document capture – to address the security and manageability needs of its enterprise customers.

Troy, Captaris, Standard Register, SafeCom, Kofax, OmTool and ReadSoft are a few of the existing HP partners.


With all this - perhaps HP CAN compete with IKON. The next move could be HP picking up some Ricohs MP9000's or iMageRunner 7105s' to fill the gaps in the product line, eh?

HP Funds New CDW Effort To Target SMB Accounts

Looks like HP is still trying to get a "big Channel" - Yet, is it in printing...

According to a memo "leaked" or obtained by Everything Channel, HP is co-funding "...110 new HP-only CDW sales people selling HP products into accounts with 499 or fewer employees..."

The list will be created by comparing D&B's customer list against existing HP Direct, HP channel partners and CDW customers resulting in more than "500,000 net new customers for CDW to target..."

According to a memo from CDW Executive Vice President Jim Shanks the alliance is set move forward next month and running full-out by year's end.

"We are taking our HP partnership to the next level with a new CDW-HP Alliance team. CDW plans to add 110 salespeople who will specialize in selling HP servers, storage, notebooks, desktops, printing and imaging."- Jim Shanks, Executive Vice President, CDW.

**

I don't know how or even if this will influence the Managed Print Service(IPG) side.

It looks interesting - HP has been denied a larger channel(IKON, Global, and Danka) so they may "partner" up with a big Box-Mover in Distribution - Squeezing the smaller printing VAR.

I imagine that the better VAR's would not see this as a real threat - HP can fund and train "500" sales reps, it won't make a difference.

How can you sell Value (the "V" in "VAR") on your butt, over the phone?

Things are changing.

What next? An across the board, 5% price increase in supplies?

Selling and U of M Football

107,501 people - Human Thunder

Managed Print Services and The Corporate Culture

2008

"No Way are you taking MY LaserJet...no way"

Change - "They always say time changes things, but you actually have to change them yourself." - Andy Worhol

Over the past few weeks I have visited many differentbusinesses looking at all sorts of different copier fleets and business situations.

Some common threads with all of the studies are:

1. The requirements of the users are far under the capacity of the machines they are using.

2. Facilities and I.T. are working together, opposed to shifting to one unique department.

3. Corporate culture: End User response is very favorable to "new" ideas and specifically, new equipment - yet they still attached to their "personal" output devices.

Point one is a no-brainer; except for true, high volume applications, general business departments, are using "more machine then needed".

Point two is a more of a revelation. I expect most print/MFP fleet decisions to be made uniquely by the I.T. department. In some cases this is true. But I have been surprised to see Both Facilities(or purchasing) and I.T. working together on the Pre-Implementation. This is not a bad thing.

This has been quite refreshing, and at the same time, very dynamic. When I see this, it tells me that the client has thought through the basic issues surrounding print management and somehow recognizes the importance of have both influences at the table.

Point three is an "oldie but a goody" - if end users have a printer in their office or cube, they do not want to see it go away. This is a challenging aspect for employers and is dealt with in a variety of ways, depending on the culture of the company.

Just a little information from the field, HMHO...

You might like these:

Managed Print Services - Everybody Sells

I.T. and Facilities and Your Copier

The Second Most Important Tool in Managed Print Services

What risks do I have if I mention my employer on my blog?

2008 -

I posed this question on my LinkedIn... What risks do I have if I mention my employer on my blog? I blog within the industry I work. In my profile, I mention my employer and in some posts, I mention what it is that I do for my company. Is there a Taboo that shouldn't be mentioned? And if I submit a post on another blog and in my signature I mention my employer, do I need the employer to review first? 

The responses have been excellent. 

"Greg, If you are worried about the risks, you are most probably not a risk taker. Simply don't." - Pieter Dorsman ----- 

 "Greg, I struggled with this concept for some time and sought counsel from some of my friends. I came to similar conclusions as everyone else here. 

 

1) I have a disclaimer on my site. 

2) I do not name names of internal associates, share financial information or anything that would be considered "sacred". 

3) I notified my company's President regarding the site as both notice for consent as well as exposure to new media options. 

4) I am very proud of my company and have purposefully aligned myself with this company due to their cultural outlook being very similar to my own. 

These lead to very productive information, I feel, being present in my posts from:

1) real-world experience, and 

2) true passion and belief. Like Corey said, if you don't have anything positive to say - don't say it if you are skeptical. I like what Nick said also. -Ken Stewart ----- 

"I would say that if you have nothing good to say, don't say it. They can't come after you if you say something on your personal time and personal web property if you don't mention their name or even allude to them. 

They'll never say anything about your efforts if you are positive about them. I think that if your employer requires a review of all that you do then you are working for the wrong employer. Let me ask this... if you are in front of a customer talking, do you first consult with your boss about what you are saying to them?" -Corey Smith -----

The Death of The Copier Dealer

8/2008

I was reading and responding to a post by Ed Crowley about Managed Print Services when it hit me ...wasn't there a time when computer dealerships were like Starbucks; on every corner of every city, town, and village? 

I'm not nuts, right? I do remember correctly, don't I? Of course I do because I worked at an Inacomp and competed with ComputerLands while working at MicroAge. My first computerized accounting system was installed on an IBM PS/2 Model 60 running Novell severing two workstations. 

So, yes, there was a time when you could open a phone book and the computer section would contain a dozen pages of dealers, software houses, VARs, and computer service locations. 

Check out a phone book now - that is if you can find one - and see how many computer dealers are out there; then go to "C" for "copier dealers". 

 Back to the Post - In one of the responses to Ed’s post, this caught my eye - 

 "...the Vendor is about making money and moving their products and services. ... a customer needs to look for a vendor that is well versed in both industries(Copier and Printer) and that is going to focus on a STRATEGIC partnership, not just focused on moving a “box” whether it be some sort of imaging device (Printer, Scanner, Fax, Copier, etc), a service contract, or supplies..." 

 Agreed - and based on this, I would suggest a RADICAL shift in Paradigm.

Vendors should become "Partners". Remember, vendors, push carts full of hotdogs down the street. I also recognize that pulling the "hardware" element out of the existing copier dealer model is impossible. Not because a new model can't make money, but rather, because the new model is too difficult for "old school" merchants to comprehend. 

I wrote a bit about Matt Espe's quarterly conference call last week. One, small, seemingly innocuous comment stuck with me, Espe said, "...the very low-end office black and white continues to go to the retail channel and continues to go from copier technology to printer technology… you're seeing actually some improvement in functionalities clearly at much lower price points by the tier two guys. 

And you are seeing that kind of shift from copier distribution to retail. We don't play there..." From “copier distribution to retail”. 

 It's deja-vu all over again. We use to joke, while at MicroAge, that Wal*Mart would someday sell High-End PCs; we laughed at the possibility.

We were wrong.

Additionally, "from copier to printer technology..." isn't that the HP model? And guess what, for me, on a daily basis, I see copiers in places where "printer-based MFPs" should be - about 90% of the time the copier that was sold to the customer has capabilities well above everyday usage and function requirements. 

For example, in the last two weeks, I have surveyed fleets totaling 107 copiers. All but seven are 55 pages per minute units, most with a 3-hole punch. The average monthly volume on each machine is no greater the 11,300. This average is by machine over the life of the 60-month lease. The manufacturer’s published volume per month is up to 200,000 images. Oh, and the punch unit is never used. As a matter of fact, in a department that did need a 3-hole punch, the copier DID NOT have a punch and they ran the pre-drilled paper through the machine. 

In the past 6 months(2008), in every single one of my surveys, 99% of the machine specifications are well over the real-world usage – as a matter of fact, I have found, when looking at all the surveys as one, the average volume per machine is 10,234 images each month. Isn’t that the number HP came up with when they did a study of all the printers in the world? (It was around 10k/unit, you can look it up) 

Consider this: If the aforementioned machines have the ability to process 200,000 images in a single month, their price has been set to reflect that capacity.  – you’re...paying...for... too... much.... capacity. 

 It’s kind of like that scene in Indiana Jones when Indy and his friend realize the Germans “are digging in the wrong place” isn’t it? This is just one facet of the Copier Model- interesting, no?

- perhaps, we are witnessing the beginning of The Death of The Copier Dealer...?