The Managed Print Services Ecosystem

I’ve spent a little time in the Manged Print Services (MPS) arena, at various vantages even.

I’ve been a customer champion of an MPS strategy as early as 2001 (with an account manager who had a vision like no other of his time  - Mark Hudson). I’ve seen various programs throughout my tenure with an independent dealer, and now I am seeing the next evolution of MPS as the various manufacturers swing in to high gear.

Throughout it all, I keep hearing everyone say, “It’s not about selling more hardware.”

Yes it is.

I’m going to pick on my friend, Greg over at The Death of the Copier when he says,

Successful Managed Print Services strategies should not be hardware driven – an assessment looks for areas of cost reduction, not hardware placement.

The iPhone as an Example:

Let’s look at Apple’s iPhone as an example. It has a hardware component, software component, and services component. It’s hard to argue with the iPhone’s success, as it is one of the most disruptive consumer technologies I can recall. But what made it successful? You may get varying answers, but in general it sought to fill a need consumers had and introduced wants that had not been imagined. With the Apple AppStore reaching over 10,000 applications, the ecosystem of what software you can run on your iPhone is seemingly limitless, which further perpetuates more sales of hardware.

A Hardware Play?

Sorry to rain on your parade, denying the fact that hardware sales does pay commissions and increase marketshare is simply inaccurate. Sales of hardware does increase the potential for aftermarket revenue. It’s this aftermarket revenue that typically yields most of the profit, which is why most MPS gurus might indicate it’s not about hardware, it’s about the output of that hardware.

Now let me back up before you start writing your hate-mail. MPS isn’t ALL about the hardware, and I see plenty of stories about copier slugs who bastardize this process because of short-sighted notions the client’s needs will be satisfied for 3 years and then they can fix all the other issues on the next renewal.

MPS has to be about a holistic approach of creating an ecosystem which includes four very important components:

1. The client
2. The account management team
3. The manufacturer
4. The third-party providers

The Client:

The client is essential in this entire circle of life. We have to have someone to buy this industry’s stuff! But don’t forget the client ultimately must realize the partnership and need for the providers to succeed and remain competitive.

The Account Management Team:

Account management carries the torch of expertise and the scales of economy necessary to accommodate a competitive program geared to achieve the client’s business goals. This could take the shape of either the independent dealer channel or the new force dujour of the manufacturer direct branches.

The Manufacturer:

While most might not be sympathetic to the need for the manufacturer to be successful, it is important to remember the need for a strongly competitive but soundly progressive manufacturing segment. This certainly extends beyond our industry, and if you watch the strength of a country’s manufacturing base, you can typically tell where that country’s position in the world is (or might be headed).

Seeing this now from the perspective of the channel, there is a very defined line between a direct branch operation and “the manufacturer” – stemming not from the difference in objective, but typically in methods of delivery.

Third-Party Providers:

From the toner remanufacturer to the software providers in this industry, all third-party providers serve as a mortar in this industry. They help enforce competitive behavior throughout the market and often help drive standards ahead of manufacturers and dealers.

The MPS Ecosystem:

It’s all an ecosystem, a cyclical system which ebbs and flows with both internal and external influences. Everyone can benefit, but there are always those players who seek to inject disruptive influences into the market.

Often, pricing is a token played to force competitors to decide if they will run the risk of fiscal irresponsibility thus creating a strategic disadvantage at a later point in time. Or a new technology begins to catch interest with clients and thus shifts the balance of power until others catch-up (see iPhone).

But most mature industries are resilient to these changes, and in the end the ecosystem continues to perpetuate itself – because of need. After all, the needs of the client, the needs of the account management team, the needs of the manufacturer, and the needs of those third-party providers tend to seek alignment for mutual benefit.

It is at those intersections of mutual benefit where we as the MPS community must seek a purity of sorts – remembering the tenants of success instead of abandoning our shared vision for expediency sake. No, MPS is not all about hardware, just as much as it is not all about reducing cost; it is not an ultimatum of one thing or the other, but it is, quite simply, a system of perpetuating the fulfillment of another’s need.

Image courtesy of Lady-bug.

Ken Stewart’s website, ChangeForge, focuses on the collision between the constantly changing worlds of business and technology in an information-centric world. Ken serves on the board of the new Managed Print Services Association, an international industry organization seeking worldwide best practices for the managed print services industry. He is also the founder of Seeking the Son. He is always interested in connecting with you.