Managed Printing Services – key factors to consider for Enterprises and Channels

 Managed Printing Services industry in India is in the cross roads.   The need for cost savings, document security, digital trails and productivity through automation has created a compelling situation for enterprises to consider Managed Print Services.  But understanding the client document landscape, outsourcing model, choosing the right technology solutions, and ensuring the right service mix are few of the factors that the Value Added Resellers and Managed Service Providers should consider.

According to Gartner, the market size for managed print services in India will exceed $275 million by 2014. Some of the OEMs project it a growth rate of 30% of the overall MPS market in India, making it one of the fastest growing MPS markets globally.

The MPS segment has gained momentum in the last few years as enterprises have started transitioning from Capital expenditure to Operational Expenditure. BFSI and telecom, being early adopters, are expected to continue to be the dominant spenders. Says  Kantilal Kamdar, Proprietor, CM Computer, a value added reseller of   prominent brands like Epson, Xerox, Ricoh and WeP Printer,” as organizations move towards more digital processing and  printing on the falling, resellers and dealers have been managed print services to promote revenue.”

Biju John, Business Head and Managing Director, Intercorp Systems and Services, explains that with MPS, businesses can simply outsource their entire printing process to reduce costs around printing and optimize document management.   For Value added resellers, managed printing services (MPS) creates more revenue per client, stickiness through recurring conversations and more contact points with the customer.

Typical MPS contracts begin with cost optimization as the primary goal. However, as the service evolves and stabilises then other value added goals emerge, in which productivity is the primary one.  In fact, that is the ultimate goal and is a continuous target to be achieved in a document management environment.  There are three factors that drive customer’s affinity towards managed printing services.

High expenditure of printing:  Installing MPS software helps track and analyse the devices, their status and statistics.   This covers photocopiers, scanners, fax machines and multi-purposes document stations.    Kamdar says that his customers want to know and gain control over their print equipment, consumables, replacement and regular operating costs.

Document Lifecycle Management: Many organizations are moving to digitizing documents for security reasons.  MPS software can track and secure every printed, scanned or copied document, through a secured workflow with proper authentication.  Moreover, MPS allows organizations to save and access digital print trials.  In short, it helps to manage the entire life cycle of organization’s document foot print.  MPS can also help policies regarding retention, destruction and dissemination of digital information.

Productivity management:  The third, but the most important part of MPS is to leverage the automation element in the workflow.  Automation helps optimize document workflows and increase office productivity.  When you scan the document, it is important to know that the scan is successful, and the expense of a transaction is also added to the audit trial.  It is also catalogued and indexed, and also given various degree of classification.  This helps during document searches, security and also expenditure management.

MPS sales is not as mainstream as selling printers as products.  Selling MPS is an add-on sales for most managed service providers and value added resellers.  The reason is that printers are always seen as auxiliary devices as against computing hardware.  However, that is changing.   This will call for a change in business approach, he says.

What is important is to understand the client’s mind set about outsourcing.  While printers look fringe, documents are not.  Documents carry data and information, and hence can be sensitive. So, essentially, three points need to be addressed before outsourcing printing.

The first point to be addressed is outsourcing psyche.  Customers hesitate to outsource for the same reasons that they are in need of.  Either some customers think that document management is least of all issues (some even call it peripheral issues) and some believe that documents are too risky to be outsourced.   Between these two extreme positions, customers have to be explained about the fine print of the importance of managing printed documents, and why outsourcing makes sense.

The second point to be addressed is fitment of the managed printing software.  The key success is to identify the right MPS software that they can market, install and support.  The data that comes of the trial is what the client and the VAR / MSP can use to create strategies for cost, productivity and security management of the organization’s document landscape.  More so, the reseller or the service provider has to understand the existing printing landscape.

The third factor to be considered is the business model.  Product resellers may look at selling the most fitting software, while MSP may use the MSP to get a recurring revenue model.  The variables in service delivery are for printers, scanners, fax machines and scanners.  The main issue is   differentiating between a simple hardware problem or a significant software management issue or analytics.  So mapping the right resource for the right type of service issue resolution is key.

So the key is understanding the outsourcing psyche, revenue model, service delivery planning and of course, the MPS software.  When these factors are properly managed, MPS delivers effective document management strategy.   This helps the service provider or the VAR to propose value sales. With productivity improvement and security assurance, there is a definite value proposition for vendors to convert customers into a recurring, long term business relationship.

The process works like any other – requirement gathering, helping the customer selecting the right technology or MPS software.  Kamdar suggests that having a general conversation with the customer about how the entire budget, pains and management challenges of document management, is a good initial step. Understanding the security policy of the organization, the customer’s industry might help in suggesting the right solution to the customer.

Customers might choose MPS for creating a document trail.  Banks, commercial firms, legal firms and even organizations that need to ensure document trails will have a comprehensive document logging system.

Offering pay per transaction is becoming popular revenue model in managed print services – already enterprises are trying this out.  The initial support of capital comes through some refinancing schemes and rental vendors in Pune, Bangalore and Delhi. The key factor of this is that one can have captive customers in their grip.  Some of the rental vendors offer upfront operational expenditure models, and smaller printer services players tie up with them, offering an end to end service.

Kamdar agrees.  ‘My company trade in Ricoh India products.  Large companies like Xerox, Canon, Epson and Ricoh, System integrators like HCL, Wipro and other smaller players like us see this as great revenue opportunity,” he says.

Managed Printing services in India are a huge opportunity for both enterprises and service providers alike.  With enterprises pushing the industry, in order to get cost effective document management, productivity, and managing digital trails, the Managed Printing Services industry is poised to grow faster in India, as compared to the Asia Pacific.