Ensuring service quality through strong governance May 2012 With so many printer companies having jumped on the managed print services bandwagon, 2012 will see this buzz continue as more organisations become receptive to this service as a means to gain transparency on print costs, improve productivity and reduce the complexity of print management. Quocirca s research reveals that service quality and reliability is consistently the top driver for MPS adoption, ahead of cost reduction. The market is maturing and customers are no longer willing to accept anything but first class service and support from their MPS provider, leaving those providers that lack the tools and infrastructure to deliver proactive services to fall by the wayside. The spotlight will increasingly fall on those suppliers that are able to deliver service excellence through robust and proactive MPS platforms that encompass deployment, helpdesk, training, remote monitoring and on-going management of the print environment. Ultimately, it is those organisations that develop a strong governance framework, defining roles, responsibilities and accountability that will stand to gain the most from an effective MPS that is aligned with business goals. Ensuring service quality through strong governance Managed print services (MPS) have emerged as a proven approach to reducing costs, both financial and environmental, improving productivity and reducing risk. As more organisations turn to MPS, they are demanding higher levels of service quality and reliability from their MPS providers. However, as the market matures, leading to a diverse range of supplies, organisations need to ensure that they partner with a provider that has proven service delivery capabilities, which are supported by a combination of best-in-breed technology, automated processes and dedicated and skilled MPS resources. 1
MPS adoption is expanding More organisations are turning to MPS for a proactive and continuous approach to the assessment, optimisation and management of the print infrastructure. Providers may be print hardware vendors or independent providers that offer a best-of-breed approach. Diverse market characterised by range of approaches The MPS market remains somewhat nebulous, with the scope of a service offered by an MPS provider varying from basic reactive break/fix service and supplies contracts (often targeted at the SMB market) to full proactive and on-going management of the print infrastructure. The level of cost and risk reduction, along with service quality, improves as organisations progress to a more complete MPS approach. Service quality is a leading MPS driver, but not always meeting expectations Respondents in Quocirca s recent UK MPS survey amongst mid-market and large enterprises (250 1000 employees) show high expectations for what MPS should accomplish yet actual performance does not always live up to those expectations. Whilst service quality is the leading factor in MPS adoption, there is a gap between companies expectations for service quality (rated 4.1) and what is actually achieved (3.4). Other notable gaps are in cost reduction and reduced environmental impact. Some MPS providers clearly need to make further progress to perform to expected service levels. Understanding position within a maturity model helps define an MPS strategy Few organisations will be at the same point in their MPS journey; some are in the early stages of device optimisation, some are already deploying document workflow tools to improve business processes. It is therefore vital that the MPS scope and objectives identify service level performance for each stage, adapting as business needs change. Strong governance is essential to establishing an effective MPS and closing the service quality gap The gaps in the performance of some MPS engagements reinforce the importance of good governance. Incorporating a governance structure that defines roles and responsibilities, processes, management and reporting is vital. Some of the more sophisticated providers operate a remote MPS infrastructure for on-going monitoring and reporting to provide strict service levels. This enables MPS to bring transformation through continuous innovation and automation, allowing MPS to become a catalyst for business growth. Conclusion Many organisations are turning to MPS and benefitting from greater expertise, lower costs and reduced IT burden. However, some MPS engagements are falling short in delivering the expected service quality. By ensuring governance is an essential part of any MPS contract, both parties can better set appropriate expectations and increase their chances of creating an effective and successful MPS relationship. 2
Introduction the MPS pretender? MPS has become a popular term but, like many other industry buzzwords, its meaning is becoming increasingly diluted leading to some MPS pretenders. Many companies today claim they offer managed print services when what they really do is sell a basic service contract that includes the hardware, service and, possibly, supplies. While this is a step in the right direction, it is only one part of the solution. MPS is much more than a simple service contract at its best it is an innovative business and service delivery model that is transforming how VARs, systems integrators and manufacturers deliver print services and solutions. More providers are moving away from traditional break/fix models and making the transition to proactive MPS. There are many basic MPS programmes, but often these offerings are typically vanilla, one-size-fits-all, hardware-centric MPS contracts that may not address the specific needs of a business; for instance, covering only one brand of device or not offering automated supplies replenishment. The most successful MPS engagements are proactive, which makes for a stronger relationship between the provider and customer, based on offering the customer the best value of services throughout the contract, and offering continuous improvement. In this way, an MPS contract can move from being broadly static to something that is flexible, adaptable and can respond to changing market and business environments. Therefore, to succeed in this environment, MPS providers must continually improve their service delivery methods to increase customer value through on-going optimisation of a customer s print infrastructure and processes. This requires the following: Technology the provider looks to proactively optimise how print technology (hardware and software) is deployed, through an auditing and design process. Process - the provider improves its operational process using unified remote monitoring and management platforms to more effectively manage service incidents, maintenance problems and also to deliver solutions which improve a customer s business processes such as document scanning, print security and workflow management. People the provider ensures it maintains the appropriate level of resource to address the needs of its customer throughout the contract period. Across each of these elements, the MPS provider has the opportunity to enhance its value to its customer. This report discusses the importance of service quality and governance in MPS engagements and why providers must bridge the service gap that is emerging as a consequence of a market characterised by a diverse range of players not all who can deliver on the MPS service promise. The report draws on research conducted amongst 100 organisations in the UK with 250 999 employees (50) and 1000+ employees (50). MPS turns a corner Businesses are under increasing pressure to transform their print infrastructure in order to lower costs, reduce environmental impact and manage risk more effectively. Indeed, Quocirca s recent study amongst 100 UK organisations (50 using MPS, 50 not using MPS) revealed that cost reduction, tracking usage and document security were amongst the top rated print management challenges (Figure 1, see graph on Page 4). Many have turned to MPS to address the inherent challenges of operating a complex heterogeneous fleet of printers and multifunction peripherals (MFPs) that can often lead to uncontrolled costs, poor productivity and security risks. MPS is a proven approach to reducing costs, both financial and environmental, improving productivity and enhancing document security. Through the assessment, optimisation and proactive on-going management of the print environment, businesses gain visibility into print usage and costs, and can minimise their IT burden by handing over administrative and service tasks to an external provider. The key element of a proactive MPS is one that uses technology to monitor the print environment, offering pre-emptive service and automated supplies replenishment. Today, Quocirca estimates that 50% of UK enterprises (with over 1000 employees) have adopted MPS (36% using, 12% piloting). The mid-market (250 999 employees) picture is slightly different, with a recent survey showing around 25% using MPS with a further 20% planning to use MPS in the next 12 months. (Source: Quocirca Print Security Study July 2011). The results for MPS are certainly compelling over 70% of respondents that use MPS are satisfied or very satisfied with the control, management and performance of print infrastructure compared to 70% of non-mps users who are dissatisfied. However, one area where MPS is not always meeting expectations is that of service quality and reliability. Quocirca expects this to become a major driver in MPS adoption as customers look for MPS providers that can demonstrate efficient and effective mechanisms to proactively manage their customers print environment. Quocirca estimates that 50% of UK enterprises (with over 1000 employees) have adopted MPS (36% using, 12% piloting). The midmarket (250-999 employees) picture is slightly different, with a recent survey showing around 25% using MPS with a further 20% planning to use MPS in the next 12 months. (Source: Quocirca Print Security Study July 2011). 3
Figure 1: Print Management Challenges The service excellence gap Service excellence has now become the basic requirement and key value differentiator that drives MPS customer satisfaction. Quocirca s survey reveals that improved service quality tops the MPS agenda, ahead of cost reduction (Figure 2). However there are gaps in how well this is achieved; whilst service delivery has a rating of 4.1 for its importance, it scores 3.4 in terms of how successfully it is achieved. This is most likely due to the variability of service delivery across MPS providers, pointing at the need for organisations to ensure that comprehensive and robust service level agreements (SLAs) are created at the outset of any MPS contract. Customers quite rightly expect service excellence, wanting a solution from their supplier that will help them to achieve their own business objectives. They want the right services, at the right service levels, at all times. By preparing a well formulated vision of what service excellence means for a particular MPS engagement, and by putting in place suitable performance management tools, both parties stand a better chance of achieving service excellence. Figure 2: MPS drivers importance versus achieved MPS Success Criteria An MPS engagement that promotes service excellence requires the following: Strategic vision: A clear strategic objective for MPS and a vision of service excellence that describes clearly the service levels to be achieved by the supplier. Transparency and control: Objective and transparent monitoring and reporting mechanisms to evaluate whether service excellence has been achieved. Adapting service outcomes: Looking beyond immediate savings to transformational service delivery with suitable and balanced remedies for addressing service problems. Continuous improvement: Mechanisms put in place to ensure that the service improves or is made more efficient along with relevant technologies as business needs change. Effective governance: This should place high emphasis on service analytics, report and communication. A governance programme allows the parties to evaluate, address and resolve service risks and issues as and when they arise. 4
The role of governance Governance is vital in a proactive services-led MPS approach to ensure that the MPS engagement is better aligned with business goals, processes and technology. One way to address this is through adopting the service management concept of ITIL (information technology infrastructure library). This framework covers best practices for activities such as assessment, planning, design, implementation and change management. The success of MPS in fact any outsourcing relationship relies on strong governance and using a trusted partner that has clear methodologies and processes in place that ensure reliable and consistent services throughout the contract. Best practices such as ITIL can be used to support wider control and governance. Often, enterprises that use ITIL practices are looking for MPS providers that use complementary or compatible processes. Relying on a provider that demonstrates such breadth of experience enables customers to leverage best practice processes already existing in supplier organisations. Consequently, MPS providers will face mounting pressure from potential customers to demonstrate how their services align with ITIL best practices. Today, leading MPS providers are already delivering MPS Services through an ITIL-based service management and delivery system that can track client s SLAs. The MPS provider maturity roadmap One key factor in improving service performance is for the MPS provider to align its services with the maturity level of its customer. Few organisations will be at the same point in their MPS journey. Quocirca s MPS maturity model describes the points that an organisation may choose to evaluate an MPS engagement. Although the out-tasking of specific areas to a MPS provider will offer less immediate savings compared to a fully outsourced model, organisations may take this phased approach to progress to a full managed print service, allowing transformation through manageable initiatives. Quocirca s model allows for a carefully managed transition through the desired levels of outsourced MPS (Figure 3). One key factor in improving service performance is for the MPS provider to align its services with the maturity level of its customer. Figure 3: MPS Maturity Model 5
MPS provider maturity In a diverse market, MPS provider capabilities can vary widely. Ultimately, service excellence requires operational excellence in every area of the business that contributes to MPS operations. As MPS providers move from a reactive to a proactive approach, it requires a move from device-centric to servicecentric Key Performance Indicators (KPIs) that shift to measuring services and experience. As the market matures, MPS providers will find themselves at different stages of maturity: Level 1/ Basic or Disjointed : These providers have the least amount of maturity. Their processes are ad-hoc and service delivery is unpredictable SLAs may not exist and resources are often dedicated to fire fighting. Level 2/ Reactive : MPS providers might be more responsive and use monitoring tools but are still more reactive rather than proactive. In such cases, customers may typically discover faults rather than the provider. Level 3. Proactive Proactive service providers can predict and minimise problems, using SLAs to set targets. These providers operate a robust and automated platform and are highly in tune with their customer s business goals. The most effective MPS providers become a catalyst for business growth, taking complete responsibility for delivering the contracted services and for meeting high performance service levels. As a partner, MPS providers also benefit by getting rewarded when the service levels are exceeded and cost savings are realised year on year. For the provider keen to achieve business expansion and improve productivity and profitability, consigning the resourceheavy break/fix model to history is essential. It is only by embracing a remote approach with high levels of automation that providers can achieve a scalable, profitable business model that delivers the increase in service quality required by an increasingly demanding customer base. Case study: M2 and Balfour Beatty Balfour Beatty is a world-class infrastructure services business. Business challenges Balfour Beatty s Managed Print Programme is a fundamental part of the group s Head Office approach to drive efficiency across the business. Previously, operating companies within the group acquired desktop printers, consumables and ancillary items on an individual basis, while also obtaining some equipment from a host of other suppliers and channels. This meant there was no central repository of print assets and there was a significantly higher cost to Balfour Beatty of procurement through disparate channels. Balfour Beatty sought a managed print solution (MPS) with the aim of reducing the cost of print, rationalising the printer fleet, providing cost transparency, improving sustainability and integrating MPS with the IT infrastructure. To identify the most sophisticated and proficient MPS solution, Balfour Beatty engaged in a competitive tender process over a period of six months, including all the key UK suppliers. Following that process, M2 was awarded preferred supplier status and asked to complete a proof of concept over an eight-month period. Once M2 had successfully completed this it was given an on-going contract and asked to migrate the entire Balfour Beatty UK business to MPS. MPS delivery The first step was to identify the requirements at each Balfour Beatty site. Initially the focus was on the main offices. M2 visited each site appraising the requirements of each department and interviewed employees to understand their print needs. As an independent provider, M2 used its wide range of manufacturer agreements to advise Balfour on the best device options depending on the individual needs of each department. M2 rationalised the printer fleet from 40 suppliers to one main supplier, consolidating the printing estate into a series of central multifunctional devices (MFDs). The MPS also included pull printing, which enables documents to be released only when a user authenticates at a device. Managed Print from M2 Provides 9 million of Annualised Benefits Over Five Years at Balfour Beatty 6
Benefits gained M2 has addressed Balfour s cost reduction objectives, reducing its cost of printing by over 750,000 in the first year of the agreement. Further benefits gained included: Improved service quality. As a centralised supplier, M2 provides a single point of contact for device maintenance and support. Remote management minimises device downtime. Visibility and transparency. By consolidating the fleet to one supplier, Balfour Beatty now has complete visibility of the entire print estate through centralised reporting tools provided by M2. This allows the business to review and plan for future business changes. Individual service level agreements (SLAs) have been made around core deliverables and these are reported on a monthly basis. Optimised sustainability. Through device consolidation and the use of energy efficient equipment, Balfour Beatty is forecast to reduce energy consumption by 45% at the end of the first year. To meet Balfour s enterprise-wide carbon reduction policy, M2 helped the company save approximately 965,000 sheets of paper in 2011 and 2,600 kilograms of CO2. Reduced IT burden. M2 s software captures meter readings from all devices, eliminating the need for the IT department s involvement. Rather than contact Balfour Beatty s IT department with printing problems, users now call M2 s help desk, enabling Balfour Beatty s IT staff to focus on other areas of their IT infrastructure. About M2 M2 is a leading UK Independent managed print IT services company. M2 helps reduce office print costs, waste and risk by proactively managing an organisation s office print strategy, infrastructure and document processes. M2 helps audit and assess an organisation s current as is printing fleet before helping design an end state solution of best practice. With its project managers and consultants, M2 helps transition organisations through a controlled change programme to secure that end state, maximising benefits. Through its professional account management team, M2 helps secure sustained benefits realisation as well as developing a continual improvement programme. M2 only operates the four leading hardware brands: Xerox, HP, Canon & Ricoh, as well as the leading software providers such as Equitrac, SafeCom and UniFLOW. M2 provides all its own expert resource, from engineering break/fix services to IT consultancy and 1st, 2nd line support for its all services. M2 provides a national UK service and specialises in the mid to large corporate market. http://www.m2.uk.com/ Conclusion Many organisations are turning to MPS and benefitting from greater expertise, lower costs and reduced IT burden. However, some MPS engagements are falling short in delivering the expected service delivery quality. MPS service delivery innovation is an on-going process and must be embedded in the resources, processes and customer relationships of the provider. If a MPS provider offers black box services characteristic of no collaboration with clients it will rapidly become a commoditised MPS provider. Successful MPS providers need to effectively and continuously collaborate with their customers to build greater value and long term customer relationships. Technology is a key enabler of service delivery innovation and MPS providers should operate a robust MPS platform that offers proactive and automated print management capabilities, delivering transparency and control to its customers. MPS providers effective at service delivery will generate greater value for their customers. By ensuring governance is an essential part of any MPS contract, both parties can better set appropriate expectations and increase their chances of creating an effective and successful MPS relationship. Relevant reading Quocirca MPS market landscape: http://www.quocirca.com/reports/677/quocirca-mps-market-landscape Rethinking MPS: The independent approach: http://www.quocirca.com/reports/626/rethinking-mps-the-independentapproach Closing the print security gap: http://www.quocirca.com/reports/624/closing-the-print-security-gap Don t sweat assets, liberate them!: http://www.quocirca.com/reports/682/dont-sweat-assets--liberate-them 7
Did you know... M2 are Europe s leading independent MPS IT service provider and offer a wide range of additional services. Available in isolation or as a complete package, these services provide an enhanced solution to your printing environment. Additional Services Full Print Audits MPS IT Service MPS & IT Consultancy M2 Staffed Print Room Print Strategy Design and Implementation IT Services IT Development and System Architects Proactive Remote Fault Diagnostics Multivendor Networking and Integration Remote Network Management Operational Services Proactive Supplies Management Legacy Device Management Nationwide Service Coverage Storage and Relocation Services Device Management and Fleet Utilisation Training Consolidated Billing Refurbish Service and Installation To find out further details on how an independent MPS Print Strategy can help your business call 0844 815 7796 or email whitepaper@m2.uk.com 380 Chester Road Manchester M16 9EA T 0161 888 5888 F 0161 877 0220 28-30 Hoxton Square Shoreditch London N1 6NN T 0207 749 1850 F 0207 749 1851 Unit 1 Museum Business Park Woodhead Road Glasgow G53 7NN T 0141 881 8950 F 0141 881 0532 M2 Limited Email: info@m2.uk.com Website: www.m2.uk.com 8