A Roadmap To Successful Implementation of a

I sold my first print management transaction in 2001. Inside of our facilities management business we had a copier fleet management agreement with a large southern university. This school approached us about putting their almost 1,500 printers on a similar program. They wanted us to manage all aspects of, break, fix and provide all supplies, labor and parts on their existing printer fleet. Additionally, they wanted to refresh all printers when they reached 48 months of service. We rolled up our sleeves, calculated out our costs, added in profit and a risk cushion, and closed the transaction for almost $150,000 per month on a 48 month facilities management (FM) agreement.

We did not conduct an assessment or recommend any redeployment or consolidation. All of the copiers were ours and we had them wrapped up inside of a separate FM agreement with onsite technicians: no reason to upset that apple cart. We simply used the university’s information from their printer management software to price an agreement. We added in a nice cushion for error and included a base of prints with overages at the same rate as the base—providing even more cushion. Was this really print management?

It certainly had what I consider the most important element of print management: a contract that provides substantial switching costs. It also had a base of prints with overage charges and even included a planned refresh of the equipment. Although I did not know it was print management at the time (we called it fleet management), and I was not prescient enough to make print management a focus strategy for my business unit at that time, it was clearly a print management agreement.

There are a few reasons why I tell you about this event, not the least of which is the definition of print management (PM). Or is it managed print services (MPS)? At times managed print services (MPS) and print management (PM) are used interchangeably. At Strategy Development we view these two sales strategies differently. The largest difference is the order in which you implement the three stages of an outsourced imaging (defined as scanners and fax units) and output (defined as printers and MFPs) fleet agreement.

Before I get to the definition, I will note a common approach with the primary goal of selling cartridges that some have included within the broad MPS / PM umbrella. You sell a cartridge at a slightly inflated price—usually $10 - $20 more than normal—and you include “service” with the purchase of the cartridge. Usually, maintenance kits and parts are outside of the scope of this bundle and are sold as needed. I call this strategy laser care or printcare. Some companies brand it to their company name (XYZcare).

I do not consider this print management. First of all, there is no long term contract. There are switching costs, as hypothetically in a 100 printer fleet you could have 100 different cartridge expirations. But the end-user can run out the agreement printer by printer. There is no management as you are not capturing any meter reads and therefore don’t have the information to recommend redeployment. You are ignoring the scanners and copiers, and possibly the fax units. You have not positioned yourself as a consultant but rather as a supplier. You are usually selling this approach at the purchasing level, which hurts your ability to leverage into a true print management agreement. And you don’t have the “platform” in place to sell equipment—an agreement that bills monthly like a lease. I think it is a great strategy for a cartridge company to add some value and protect the margins on their cartridges, but by Strategy Development’s definition, it is not print management.

MPS involves the optimization of an imaging and output fleet followed by the management of that optimized fleet and continued improvement as changes occur in the business that implemented the MPS agreement. So the order of events is optimize, manage, and improve.

PM starts with the management of the current infrastructure, followed by improvements and optimization of the imaging and output fleet. Improvements and optimization occur together after you have the fleet under management.

In either approach, improvement and optimization could include the deployment of enablers such as advanced capture, document routing, or variable data. You may even enter the production space with web submission or production workflow. Predominantly, optimization is defined by MPS companies to mean device consolidation, replacing scanner and fax units, as well as single function printers (SFP), with “departmental” multi-function devices (MFD).

MPS in its purest form is best deployed in enterprise environments, which we’ll define as Fortune 1000 companies for some loose clarity. This is where HP and Xerox focus their direct efforts, although with slightly different strategies. In large companies culture change is dictated—and supported strongly—from top management. You aren’t accessing your hotmail account through the company network unless it is supported by IT. If you want instant messaging you dare not download the program without IT approval (you probably couldn’t download it if you wanted to). If the company believes they can cut 20% of their current spending by moving to an MPS agreement—by deploying an optimal asset to employee ratio and without impacting productivity—they aren’t taking an employee survey to see what you think about losing your personal printer. They’ll simply implement the program.

For those of you reading this that have sold these multi-million dollar agreements I am not minimizing your efforts. I led the sales efforts on several successful multi-million dollar contracts so I know they are never as simple as it sounds. Even after gaining agreement on the concept, you need to present financial justification, gain consensus with the multiple stakeholders while minimizing the dissenters, compose an acceptable project plan, define metrics and service level agreements (SLA), and report back the savings as they are realized. You may even need to build in a gain share agreement that has your contract price tied to the empirical savings of the company. This selling cycle could take 12 – 24 months. I applaud your success in this difficult strategic selling space.

The point is that true MPS is a very long selling cycle that requires that the implementing company supports cultural change.

There is another variant of MPS that is deployed in smaller companies. The value proposition is tied to the perceived “normal coverage area” of a company’s documents. Simplified as an example, it plays out with the sales rep showing a prospect three or four different documents, representing 5%, 10%, 15%, and 20% coverage area documents. The prospect selects “somewhere between 10% and 15%” and the sales rep then explains that 12.5% coverage results in their cartridges yielding only 40% of its stated yield (5/12.5); therefore, they are paying significantly more than they think to produce a print. Knowing that there is little to no truth in the prospect’s misplaced choice, the rep then prices the transaction using a normal yield on the cartridges and “moving” the difference onto a lease to fund equipment. I could write an entire article on the math of this transaction, but anybody reading this who ever sold a copier against a printer knows the calculation.

Both of these selling strategies are equipment focused and based on immediate expense reduction. Therefore, they both need to be sold at the CFO, COO, or CEO level. This is MPS as defined by the major independent research firms such as Info Trends, where the value of implementing the program is the immediate savings. As already discussed, the first approach involves a very long selling cycle that involved changing the culture of the company. The second approach can work well when there is no competition, but those days are quickly waning. In a competitive transaction your shell game will be exposed and you could rapidly lose your credibility. This approach also does not build the most important benefit for the dealer of managing the output environment—pumping up the aftermarket revenue—as quickly as the print management approach to be discussed next. Although both are viable approaches, Strategy Development recommends a print management approach for dealers or VARs. We will discuss this approach in next month’s issue of Enx Magazine.


Tom Callinan is the founding principal of Strategy Development, a management consulting firm specializing in business planning, sales effectiveness, advanced sales training, and operational and service improvement ( www.strategydevelopment.org ). From 1998 – 2005, Callinan was an executive with IKON Office Solutions, most recently vice president and general manager of IKON’s largest business unit with revenue of $1.4 billion. Prior to IKON, Callinan was the founder and CEO of Copifax, Inc, a copier dealership that was recognized with numerous awards including inclusion on the INC 500 list of fastest growing private US companies. Copifax was acquired by IKON in 1997. Callinan graduated with honors from The Wharton School, University of Pennsylvania. Tom can be reached at callinan@strategydevelopment.org  or 610.527.3317.