In today’s age of distributed architectures, one can think of a million things that need to change within the enterprise- Virtualise my servers and consolidate my datacentre- check; Implement cloud-based email solution – check; Optimise my networks and bring in unified communication capabilities – check; Consolidate my storage networks and bring in heavy-tiering – check; Mobilise my sales force – check; Implement my software stack on an internal cloud – check; Manage my print output, Optimise my capital expenditure -- Hmmm. A commonly ignored aspect of enterprise infrastructure is actually one of the ultimate end-points of data- death, or more commonly known as print page.
Yes, today, an overwhelming number of pages are wasted within even the largest and most efficient organisations. This is called, ‘the law of taking things for granted.’ The last thing on a CIO’s mind is paper management. "That’s for the admin guys and too trivial an affair when my storage is choking on enterprise data, isn’t it?"
Now, one may say, the first thing that enterprises should be going green with, is a paperless office, considering this is not one of those industries that has towering and sooty pipes, but waste is more discrete at this end. Laughable as it may seem, a paperless environment can only clearly mean- less paper as opposed to no paper. Now, although this may be subject to change based on newer devices like tablets and more, that may also be a far fetched reality for any one, other than a first world citizen.
Coming down to the subject, today is going to be more about paper management than anything else. The classical method of buying more than you need, as opposed to just as much you need, has become quite rampant. But here's a big question, “How much is just as much as you need really?"
Now, there is somewhat of a solution to this ambiguous landscape. Managed Print Services have been around for a while now, major players being Xerox, Cannon, Lexmark and HP to name a few. Now, if you haven’t already heard about this, it's kind of like renting a house. Now, every house comes with a set of consistent and variable requirements. In the case of a house, you have a deposit, which is refundable, and rent, which is payable monthly. Now the variables- electricity bills, water and utility usage, and whatever else applies specifically in your case.
Print services are somewhat the same. You sign a deal with a print vendor and they give you an 'X' number of printers as per your requirements, and how much you print on an average. If one sticks to the limit, defined by the KRAs in the deal, great, if not, there's a per page cost associated for extra pages/refills, and so on. The biggest advantage to this scheme is the move from CAPEX to OPEX.
A recent report by IDG confirms that 2010 is going to be the year of liquidity management, the move from CAPEX to OPEX, wherever possible. In light of this, as more and more customers look into their hardcopy device strategy, they will be interested in getting this cost off CAPEX, so as to exercise manageability and control. As this has been seen happening, there are more players entering this market.
Now what we're talking about today is HP's entry into the MPS market. HP has had a good presence in the printer technology market, and has many innovative solutions for cartridges, color precision, etc. However, the company is now looking to diversify this offering, given the scope of MPS in today’s enterprise environment.
I had the pleasure of attending a conference on the same in Beijing, where various analysts and executives discussed the benefits of MPS arrangements. Now, the value proposition here is interesting." Today enterprises are more concerned with re-aligning their organisations with the economy. Cost is ‘King,’ and in this scenario, CXOs are clearly looking to optimise where they can. When speaking about their hardcopy device strategy, our survey showed us that 37% of the CIOs interviewed, mentioned they had MPS as a hardcopy device strategy, while others mention tweaking color access, print routing, etc.," mentions Sandra NG, GVP- ICT Practice, IDG.
HP’s entry in this market is somewhat justified, considering they have access to the print technology, and can tweak it with much ease, and to add to that, they do have a very serious computing division, that gives them somewhat a double edge in this case. The key here is integration, which the company claims to do phenomenally well.
Speaking on the subject, analyst Vishaal Tripathi, from Gartner comments, "The primary objective here is to bring about dollar savings. MPS is a natural progression for many print providers in the office environment, because it offers a value-added service to the hardware and network infrastructure that they may already be providing. Surprisingly, although MPS adoption is strongly gaining momentum, still a large proportion of businesses do not fully understand the benefits of MPS. Confusion is also accentuated by the lack of consistent definition of MPS among the vendor community. HP is looking at leveraging its complete technology set along with its MPS offerings, to provide an end to end solution, which is not really a bad decision on their part."
Now, as far as customers are concerned, HP currently has implementations widespread in South East Asia (more specifically Singapore), and Australia. When it comes to India, there were a few customers, the company was not willing to talk about, however they plan to push aggressively through their channels so as to increase adoption.
Speaking exclusively about the India scenario, Ravi Aggarwal, Director, Imaging & Printing Group, HP India talks about how HP is planning to push MPS to Indian customers. He says, "HP provides proactive end-to-end management of an enterprise’s imaging and printing environment. We are also enhancing our channel-led MPS with select channel partners, known as ‘Office Printing Solutions Partners,’ wherein the company makes a greater investment in business tools and programs, which enable reseller partners to offer MPS to customers. In addition, the enterprise business division recently launched new products and solutions for enterprise customers in India, to accelerate customer business results, and had the largest ever rollout of new workflow solutions for key segments, including the public sector, services industry including BFSI, and the manufacturing & distribution industry."
"HP’s offerings in the imaging and printing space help reduce total costs – direct and indirect costs of enterprise imaging and printing. Though the cost of the services depends on various factors such as the service employed, size of the enterprise, and printing needs, HP Managed Print Services helps organisations achieve cost savings of up to 30% through strategic management of their output print environment that minimises costs, and maximises business results," continues Aggarwal.
Furthering this conversation with Aggarwal, we got a good view of HP's in this space.
Optimising Infrastructure – HP takes control and optimises the enterprise’s imaging and printing devices and network infrastructure through:
- Assessment Services – to help companies gain more visibility of their current usage, uncover hidden costs and develop a business case for change.
- Financial and Procurement Services – to enable companies to realise lower total cost of ownership by planning for and acquiring new technology, to retiring and replacing it.
- Transition and Implementation Services – to ensure that the right equipment is installed in the appropriate location and that the end users know how to make the most of it.
Managing Environment– Through its management and support services, HP enables ongoing return on investment (ROI) through fleet availability and optimisation, support and supplies management and greater visibility into usage trends, capacity and expenditures.
Document and Workflow Services– HP is partnering with companies so that they understand and improve their workflow by automating paper-intensive workflows and better managing the underlying infrastructure that supports enterprise processes, for accelerated business results.
Now, HP also claims that these services will come in handy for large and small enterprises alike. Considering SME's are joining on the liquidity management bandwagon, they too are looking for service-based solutions for various needs, be it emails or print.
However, when you're talking about SMEs there's one problem- over commitment. Tripathi explains, "The issue here is not about the services offered. As mentioned earlier, they do help organisations that fit the bill with cost savings, but the system works on the fact that you put down 'X" number of pages in your KRA as your monthly consumption, and you try and stick to this. But SMEs sometimes cannot keep up, and print volumes as a result are underutilised. India is a volatile market at this point. It’s no surprise that enterprises over commit, and under utilise their resources. Its also become difficult to carry these high-level messages through a wide channel and distribution model."
Now, although this seems like quite a major issue, it is something that HP will have to deal with when it deals with its customers. Indian customers are quite sharp, and quite anal about getting the right deal. HP or other print service providers may need to shape their strategy in order to customise their solutions to more of an Indian audience.
HP at the end of the day does have some good apples in its basket. A sales approach that encompasses the end to end HP product line, packaged deals with integrated services, next generation products (printers) that are specifically designed to eat up the competition, and an extremely strong partner/channel network. It’s only a matter of time before enterprises consider utilising this strategy either by getting it from an ISV, or implementing it in an in-house cloud. Which style gains more popularity remains to be seen, however, the 'Value Equation' does seem justified.
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Updated Date: Jun 14, 2010 15:29:46 IST