Printers

Will a managed print service lower costs?

Vendor promise that a managed printing service will lower printing costs. Is it the truth? Scott Lowe discusses an underway pilot at Westminster College.

AIn my previous posting, I discussed the merits of Westminster College's switch to the PaperCut print management software. The deployment of a package to impose enforced limits and visibility into printing behavior has allowed the college to reduce overall printing costs by helping users become more aware of their habits. In short, we've reduced a lot, but not all, of the waste in the system.  Frankly, I doubt we'll ever eliminate 100% of the waste, but any efforts we can take to get to, say, 95% are good.

Westminster College has also changed from using OEM toner cartridges to using refilled units that, believe it or not, work extremely well. Between the two steps, we've been able to bring skyrocketing printing costs under control.

However, I've recently been told that we continue to leave money on the table when it comes to print costs and that we can continue to reduce these costs by outsourcing overall management of our printers to an outside group. In the past, other things have gotten in the way of looking at this managed printing service, but this time, I decided to let the company give it a shot. In their pitch, the sales person promised to either meet or beat our current costs for both toner and printer repairs and indicated that we can keep our current printer fleet intact. Over time, if we find that we can get better costs with different printers that meet our reliability goals, we'll consider it.

The company we're working with has a local presence, and the references with which I've discussed the project spoke very highly of the company and indicated that their promises of lowered costs and less printer management hassle were very true. As a result, over the past few days, we've installed software on one of our servers to help the company gauge the use of our networked printers so that they can determine a cost per page that makes sense for us.

Assuming that we get results from our printing analysis that show the company that we can actually reduce our overall print costs -- and I will obviously independently verify the results -- we will enter into a month-to-month arrangement with the group under which they will monitor, manage, and repair our printers as necessary. Also under this agreement, the company will advise us on ways in which we can redeploy our printer fleet in order to maximize the program's effectiveness and, in turn, minimize our printing costs.

At present, we do devote some staff time to overall printer management, including toner management, which involves stocking and replacing toner, and printer repairs. For repairs, we have a break-fix arrangement with a local repair shop, and so far, this arrangement has been effective. That said, if we're truly able to meet or beat our current costs and we can reduce the amount of IT staff time that goes into the administration of our printer fleet, it seems like a no-brainer proposition, particularly since we'd be on a month-to-month contract with no long-term commitment. In my opinion, the risk for this arrangement is very low while the upside could be potentially significant.

If things work out and we're happy with the results, we can consider future opportunities that might include hardware replacement, but those options require a longer-term commitment, and for now, I'm interested in seeing how things go first.

Within the next 30 days, we'll have the first-pass results for the first vendor, and depending on those results, we'll decide whether or not to move forward with that company, look at other options, or simply maintain the status quo. As always, I'll report back on progress.

In the meantime, I'd be very interested in reader feedback on managing print services in general.

About

Since 1994, Scott Lowe has been providing technology solutions to a variety of organizations. After spending 10 years in multiple CIO roles, Scott is now an independent consultant, blogger, author, owner of The 1610 Group, and a Senior IT Executive w...

21 comments
Roxy Quicks
Roxy Quicks

I am thinking that MPS definitely does lower costs! I have a small business but we do A LOT of printing and its super costly. I looked into this business around me called Governor Business Solutions (We are in Michigan) and have they a lot of helpful information on their site. I am going to speak to them more about it but if anyone is in Michigan, I highly recommend them! http://www.governorsolutions.com/solutions/mps/

mike705
mike705

MPS will NOT low your printing cost. For more than 25 years I've been in the printer service and sales business and I will say it's nothing but BS. This is just a way for the service company to lock you in to their service. For starters you can download (for free) the HP WebJet admit software. This will let you monitor all of your network printers - you know - the same as that magic software that they use, hint, hint. Next get rid of those small printers with small toner cartridges. The bottom line you spend way to much per page. Next, aftermarket cartridges are ok to use. Just don't purchase the cheep ones. spend a little bit more and your get a good quality product. The best is to purchase them from the company that provides you with printer service. Final if need to have your printers repair more than one a year - find a new service company. They're not do a good job. Do that and you will lower your printing cost without needing to pay some con for Manage Print Service.

bkimmell
bkimmell

Yes. A review of your document output environment will indeed bring savings. To your statement Scott that 'I will obviously independently verify the results' how will you know if the data the vendor provides will be verifiable and prove savings. Vendors use industry metrics difficult to question if you are not from the industry. I have been in working in the industry as a consultant for 15 years and have seen my share of questionable contracts and claims of savings. Just be careful that you don't buy your way out of your expensive situation with shiny new sophisticated MFDs. Good luck! BKimmell

TW210
TW210

Ever have one of your helpdesk techs try and try and try again to remove that single piece of paper? or struggle to find that part that's causing a problem? and call for backup? Sit for hours with the vendor on the phone? I've found that using a managed print service for hardware repairs and fixes that take you longer than 3minutes are key. We use a service, you call, and they are there w/in 8 business hours. Strategically, place your printers so your users don't have to waddle that much farther than normal. It works like a charm. So I'd recommend you use this kind of service for the hardware aspect. Hours of a single tech can go by as he tries and tries and tries some more, never to avail, leaving that printer to gather dust days and weeks later. BUT I've also found, it's easy enough to inform a few members of your team, to manage the non-hardware aspects of your printers. To have a company manage absolutely every aspect of your printers seems like a waste of money and even quite lazy. It's such a easy thing to manage and understand, why not do it yourself?

The Admiral
The Admiral

I have a question for you. Why must everything be managed? If you continually show that you can reduce costs, you work yourself out of a job. I was part of a large corporation that went to a centralized, managed print system. THey laid off all of the technical folks and went to "Key Operators" who were trained to work on the printers. These key operators in many cases were not remotely technical people. So a high demand printer went from being serviced in 2-3 hours to 2-3 months, a month if people called and complained about it enough. If your going to manage the entire enterprise, you simply need to have a support structure in place - if not, you work yourself out of a job.

dallas_dc
dallas_dc

About 3-4 years ago, we entered an agreement with a service provider for a different managed print service. We have not implemented monitoring on printer usage, but may do that ourselves at a later date. We have a few hundred printers in two buildings (and have expanded this program to printers at several braches in the US). We pay by the page a small fee, and in return the vendor provides all of the toner and maintenance. All PM's are scheduled by the vendor, and we only pay for broken parts that are not part of a normal PM. This has worked well for us. We don't have to worry about ordering toner or how much to keep on hand. We were not keeping up with Preventation Maintenance before, and now it is handled for us. Also, our costs are almost constant which is easier to budget for. There has been a cost savings, but I would have to gather some data to give you the details.

bdougherty
bdougherty

Hello Scott, I work for a large engineering firm. We have over 60 offices across the country. We have 2 contracts. One for small format, and one for large format devices. We have cut the number of printers and strategically located them throughout each office. The number of printers we had before has been reduced to a small manageable number. All of our contracts are based on volume only whether it's large or small format. We pay by the square foot on large format. We have seen our printing costs drop immensely. We have also pushed 2 sided printing, which has reduced the amount of paper we are using.

Dereckonline
Dereckonline

Why was this article not posted on day 61 with results? Seems to beg the whole question of its purpose??

changeforge
changeforge

Scott, I now work within the industry I once hired to optimize my fleet - just as a bit of a disclaimer. In 2001, I obtained a position at a local division of a manufacturer. Between the ConUS division and the UK division I helped with, my scope of coverage was not terribly extreme - but very limited on budget. At this time, MPS was not even discussed. I initially began interviewing a few providers on updating my legacy line printers for an old DEC Vax Miniframe - attempting to go from 5-part forms to 8.5" x 11" standard cut-sheet forms. After discovering some of the technology and costs savings that might be possible, I embarked on a true strategic initiative. I would share with you the following: 1) Footprint was only our ConUS plant, with some 100 employees running 3 shifts. 2) I eliminated serial line printers and costly local inkjet printers (purchased b/c they fell below corporate cap-ex guidelines). 3) Optimized my fleet to 20 locally attached desktop laser printers (for convenience), added 19 network attached printers and mfp's (ranging from 20 ipm's - 62 ipm's in speed) and in-sourced a majority of color production. 4) Rolled out print-on-demand concepts for most color marketing literature and operations manuals (thus reducing inventory) as well as variable data forms overlays. 4) Introduced high-speed scanning - with all the obvious benefits 5) Accommodated a wide format digital copier 6) And instilled constant process improvement measurements. Summary: On a 5 year plan, I estimated we realized an estimated hard-dollar savings of 30% - 50% over current expenditures. This did not really account for the efficiency enhancements as my CFO would only count "soft-dollar" savings if jobs were eliminated - quite literally. We mostly broke even (which isn't bad for the huge jump in technology and efficiency gains) until we focused on in-sourcing marketing literature. That was perhaps our greatest line item of savings. I hope this offers a little bit of perspective from someone who had measurable success and wanted to take a successful strategy to other customers who might benefit. Warmest Regards, Ken Stewart

GregWalters
GregWalters

First off, congratulations on your MPS endeavor, so far, so good. Behavior modification software is one of the components in Stage 1 and 2 of a MPS Engagement. And saving money in these stages is guaranteed - its a no brainer. You should be asking why it took so long to get where you are today as well as "what next?" The ultimate goal of every well run MPS Engagement is to reduce costs; how about reducing the number of printers? And how about reducing the number of open printer based tickets? So, you are ridding your school of all the closets full of toner; what about the copiers? And what about all the school's paper-based work flows? Do you think there might be redundancies and waste in, say, the admission process or tuition payments? Tip of the iceberg. One more thing,...how are you managing ALL your network and infrastructure assets? Someday, maybe your output devices will be represented on a screen, in your NOC. Thank you for documented your project, this is great stuff.

Scott Lowe
Scott Lowe

I once worked for an IT Director that said that our role was to try to put ourselves out of business (IT, that is) by making things so easy for the end user that they didn't need us. Obviously, needs will change and evolve and, as a result, people will need to change. I'd never NOT do something that makes sense just because it might reduce costs and show that we can do things differently. Frankly, the role of IT is changing anyway and it's only going to get better. The more that we can get out of the mundane (i.e. managing printers) the more we can focus on operational excellence across the organization. Scott

GregWalters
GregWalters

Yeah - reducing head count certainly reduces costs. Technology has shifted the work force from the beginning of time, Ludites Unite! It is an interesting fact - on the other side, reducing the number of prints, reduces the number of needed copiers/printers and shuts down plants all over the world...reducing the number of assembly workers needed to make Canons and manufacture toner. Vicious, ain't it?

mike705
mike705

This is a great example of how the consumer is ripped off by manage print services. you only pay for the parts - and the price of those parts are more than what you should be paying. Your per page cost is also more. I've had customers brag that they only pay 1 cent per page and the labor is free. For starters that's a 200% markup for your supplies and the truth is you don't really know what you're paying per page. Here's how it works. You make the deal for one cent per page but that based on a 5% coverage. So when you print more than 5% coverage you billed as if it is 2 or 3 times the agreed price. But what if you print at less than 5% - do then charge you less? NO. Also will your per page cost decrease with time? After all toner cartridges always decrease with time. The answer - NO. So you decreased your printers which decreases the production of the company, you really don't know what you're paying per page, you don't benefit if your printing is less than 5% coverage, and your locked in to a service provider - but you don't pay for labor. Why do you think so many companies are promoting Manage Print Service? They make more money from the customer while the customer thinks they're getting a great deal.

hwasse
hwasse

At Seattle Central Community College, we implemented a managed printer service contract, and a cost recovery system (Pharos) for student printing. At first we charged 1 cent per page, just to get across the idea of paying for prints. We cut printing by 80% on student systems, with no complaints. We were able to redeploy an excellent technician from supporting printers and use his skill on our networks. Toner "magically appears" and we no longer have to scrounge parts for old equipment.

oleary_at_pharos
oleary_at_pharos

I agree with Greg's first response - congratulations...and there IS so much more. To truly manage print and all of the savings that can be garnered, you want to consider all the areas that "print happens". For a university, that includes student print (labs, libraries, dorms, etc), centralized print / in-plant, and external print. Innovative universities are looking at the whole picture, but many still segment these areas into different buckets. Savings come in a lot of forms: * Waste reduction * Fleet rightsizing * Print optimization - getting print to the right devices * Solving the puzzle with centralized, in-plant print (keep it, kill it, move more work there, pull print in that is going external, etc) * Improved sourcing (supplies, PAPER, etc) * Changing user (student, faculty, administration) behaviors The real blockbuster savings sits with doing all of these things well of course, but many times the behavior part is overlooked or limited to "reducing waste". Our philosophy is to develop the right behaviors that "...make every print an intelligent decision." - If print needs to happen, ensure it goes to the right place - If print doesn't need to be in color, or doesn't need to be single sided, then make it B&W and duplex - Ideally, don't print unless you have to - And of course, use effective software to track, manage, educate, and gently-or-forcefully manage your University print strategy There's a world of opportunity for Higher Ed and corporate enterprises alike. Be sure you have a comprehensive strategy that addresses the total picture, not just the picture that an MPS provider can address. Although there are many cost savings benefits from MPS providers today, I often wonder how energized many are to reducing print overall when most are paid "by the click". Well, for now, let's not go there. Peace...and don't print this response unless you have to. Mike

dallas_dc
dallas_dc

You will never get so efficient that you work yourself out of a job. Being efficient gets rewarded in all but the most screwed up companies. If you are so efficient that you run out of things to do, they will give another hard nut to crack. I am generally NOT in favor of outsourcing, particularly to overseas labor sources. However, there are some things which can be done more efficiently by an outside company that has a specialty such as printer management. I don't know a computer technician alive that wants to deal with printer service all day. I think the Admiral needs to reconsider his strategy.

adrianvc
adrianvc

Hey someone that is not biased and knows what they are talking about. MPS is an absolute rort concocted by OEMS to increase profits.I am well aware of this selling against and for both sides. For the record i am out of the game now ...... as for anyone that thinks they are saving money under MPS i doubt it very much.As for the "operational excellence" i wonder what your boss would say to you signing up to manged print and your printing expenditure increasing....That would really do you out of a job!

GregWalters
GregWalters

MPS is all about "reducing" - reducing machines, reducing clicks, reducing costs. And to some in the industry, this means cutting our own throat. So be it. There is so much cost to be cut because the industry oversold for a decade and a half - not that there was anything wrong with that -but the future ain't what it use to be and was bound to happen. A shift, a disturbance, secular not cyclicle.