MAIDSTONE BOROUGH COUNCIL LEADER OF THE COUNCIL REPORT OF THE HEAD OF BUSINESS IMPROVEMENT

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1 MAIDSTONE BOROUGH COUNCIL LEADER OF THE COUNCIL REPORT OF THE HEAD OF BUSINESS IMPROVEMENT Report prepared by Steve Trigg Date Issued: 16 April MULTIFUNCTION DEVICES AND PRINT MANAGEMENT SOFTWARE FOR MAIDSTONE HOUSE Issue for Decision To consider the provision of multifunctional devices within the new offices 1.2 Recommendation of the Head of Business Improvement To agree to the award of the provision of multifunction devices and associated print management software from Kent County Supplies through Ricoh/Infotec; To give delegated authority to the Chief Finance Officer to agree the outright purchase or annual rental of the print management software following further investigation of purchase cost; To give delegated authority to the Chief Finance Officer to agree the most economic settlement of rental agreements on existing equipment; and To agree that the provision of a bond is not appropriate for this contract 1.3 Reasons for Recommendation The outcome of the review of how the Council conducts its printing and photocopying was the desire to migrate to multifunctional devices (MFD s). This allows for photocopying, desktop printing, low level scanning and faxing to be provided via a number of strategically positioned MFD s and the elimination of the large number of independent devices currently in use The benefits of this approach are cost savings from reduced

2 space requirements as well as lower costs and reduced environmental impact. In addition, investment in print management software allows for savings from better routing and use of the printers and further environmental benefits The budget set for the new equipment was that it should be cost neutral or better compared with present spend on hardware, consumables and maintenance During March 2007, a print audit was conducted to inform the requirements for devices, configuration, quantity and actual deployment. The results indicated a total print and photocopy annual volume estimated at 9,000,000 copies of which approximately 500,000 were colour reproductions Specifications for devices and the numbers required (both mono and colour)were devised based on this audit, the space plans, advice from the print audit supplier, advice from IT on future machine and software integration requirements and discussions with managers on the new way of working and general deployment plans. These discussions also included agreement that desktop printers will not be used within the new offices and that only specialised printing equipment will be transferred (such as the large planning printers). It is important that with the exception of permanent home workers, all printing is conducted within the office. Proposals Based on the above, proposals were sought from the market via a mini competition using the newly created CBC 6 (Central Buying Consortium) framework. This was selected as it was most likely to offer the best value for money. This framework is administered locally by Kent County Supplies and is compliant from both a European directives perspective and the Council s constitutional requirements It was considered that seeking proposals based on the print audit results and future intended way of working, would provide an optimal solution from a financial and service perspective. Financial, quality, environmental, reference and other checks were conducted under the original Central Buying Consortium OJEU tendering exercise.

3 1.3.8 Three proposals were submitted. (An alternative proposal from Canon was not evaluated as it did not deliver the overall solution required) The table in exempt appendix 2 describe in summary the costs of the printing solution proposals received based on: Generally accepted best practice to rent devices rather than purchase outright, and that the 5 year rental period offers best value for money. (Although 3 and 4 yr proposals were received); Annual print and photocopy volumes of approximately 9 million; A requirement for 15 open floor MFD (copy/print/fax/scan) and 3 print room devices; A need for print management software to obtain optimum operational and financial performance from the hardware; Acceptance that a number of existing machines would need to be settled in terms of existing rental agreements and; That the opportunity would be taken to redeploy redundant devices to other Council sites where the opportunity arose and was financially beneficial The assessment of options showed that the Ricoh/Infotec solution offered the most economically advantageous price. To progress this option a decision is needed by 18 April to ensure the solution is in place in time for the office move. Costs and savings The proposed solution shows an annual cost of 84k. This compares to existing spend in excess of 89k The annual cost may be further reduced through: Capitalisation of the expenditure on software. Negotiations are underway to achieve this. Should this prove beneficial then budget adjustments will be made in conjunction with Corporate Finance and the IT steering group; and Reductions in the annual settlement costs depending on the financing arrangements.

4 The figure for existing spend is substantially lower than predicted by industry norms (equating to between 1p and 1.5p per print compared with a normal range of 2-5p). However it does not take account of: spending on printers; any reductions in paper that will result from improved management; and energy reductions Further analysis and review will be undertaken to identify and capture these savings to maximise the benefits achieved The management of the MFDs will come under the new post of Facilities Manager who will also help ensure that the equipment is used efficiently to take advantage of its capability of further cost reductions The Constitution requires a bond where contracts exceed 100,000. However, a bond is not considered appropriate in this instance, as the contract will be placed with Kent County Supplies, which is administered by Kent County Council, who will be responsible for alternative arrangements in the event of supplier failure. 1.4 Alternative actions and why not recommended The alternative would be to move to Maidstone House with the existing equipment, but this would add to the pressure on space, be more expensive and prevent much needed efficiency in print management The existing technology is also more limited and therefore several machines are required to do the job of one multifunctional device. This leads to greater energy use, more noise and slower functionality. 1.5 Impact on corporate objectives Implementation of the recommendation will contribute to the core values of value for money and efficiency and be environmentally beneficial.

5 1.6 Risk Management The proposed service hardware and software solutions have been chosen based on the best information available. The supplier is well respected within the industry and has acquired substantial business in Kent serviced by a well established service support network. The direct input of a facilities resource to manage the print solution will help ensure costs are managed. The scope of the CBC6 agreement enables change as a result of under or over specified hardware and it is therefore considered that any risk has been minimised Reference sites have been visited by both Procurement and IT department representatives. 1.7 Other Implications Financial x 2. Staffing 3. Legal 4. Social Inclusion 5. Environmental/Sustainable Development x 6. Community Safety 7. Human Rights Act 8. Procurement x 9. Asset Management The financial implications are set out in Appendix Environmental benefits are achieved from reduced power and paper consumption The proposal complies with the requirements of the Constitution.

6 1.8 Background Documents There are none. 1.9 Reason for urgency The decision is urgent as the supplier requires confirmation of the Council s commitment to the rental/purchase of devices and software by 18 th April 2008 NO REPORT WILL BE ACCEPTED WITHOUT THIS BOX BEING COMPLETED Is this a Key Decision? Yes X No If yes, when did it appear in the Forward Plan? Not in Forward Plan Is this an Urgent Key Decision? Yes X No Reason for Urgency See above. How to Comment Should you have any comments on the issue that is being considered please contact either the relevant Officer or the Member of the Executive who will be taking the decision. Councillor Fran Wilson Stephen Trigg Leader of the Council Telephone: franwilson@maidstone.gov.uk Procurement Manager Telephone: stephentrigg@maidstone.gov.uk

7 APPENDIX 1 Savings profile Existing photocopier annual rental costs Existing photocopying annual copy costs Estimated existing annual printing consumables cost Estimated total existing photocopying and print costs per annum Proposed MFD solution Expected saving per annum** 33k 20k 37k 89k 84k* 6k * Costs may be reduced through capitalisation of the software ** Additional savings should be realised through reduced paper use, power and reductions in printer purchases. These are not included at this stage but will be reviewed after 6 months.