By Charity Parsons; Market Development Manager, Ricoh Americas

Welcome back to MPS Stage 3, 4 and Beyond: The Ongoing Evolution. This issue we will look at the top MPS trends for 2012.

Companies are jumping into the world of managed print services faster than Devin Hester on a punt return. Some are seeing growth through acquisition, some organically, and others through a combination of both. It’s true a person cannot be defined by his past and many companies today are betting the same is true in business. The landscape of organizations in the managed print services space continues to expand. Managed print services providers now include consumable product providers, office technology equipment dealers, consulting firms, managed services providers and large manufacturers of all types.

In 2011 we continued to see an increase not only in the number of companies selling MPS, but also in the different types of companies offering it. An increase in competition along with the diversity of skill sets and delivery methodologies will have a positive impact on this maturing industry; more specifically as it relates to Stages 3, 4 and beyond. Even more important than the number of companies whose primary focus became MPS in 2011 is the type of contracts that are being signed and how companies are managing to them.

We are seeing a dramatic increase in customers asking for a managed environment. Primarily they have looked for these services to save costs and reduce the internal burden associated with all of these management tasks. What has not happened as regularly as it should is measuring the actual results against the contract. Most customers are not doing their due diligence after the sale. They are only looking at MPS providers that have the best sales pitch and not necessarily the best delivery strategy and best practices. As a result, customers have not been able to effectively measure the success of their program or, even worse, can see the results and realize they are not hitting the goals promised in the contract. As this trend becomes clear to decision makers there will be a greater emphasis on the actual impacts of executed MPS contracts.

As customers start to push for proof that contract promises have been met we will see an increase in two areas: change management and contract structure. Both customers and vendors are attempting to change the way MPS contracts have been written in the past. Both are looking for mutual accountability. Vendors need customers to take responsibility for internal issues that reduce the success of the MPS implementation (i.e. a lack of sponsorship or low user adoption). Customers want to hold vendors to the promises they make and have a course of action if expectations are not met. The growing contract strategies issue leads directly back to the increased trending toward change management. Companies looking for a truly managed environment cannot look at their MPS provider as a vendor who is doing MPS to them. They have to accept the provider as a business partner who is developing MPS as a strategic program with them in their organization. The customer absolutely must participate in the process to make it as successful as industry statistics say it can be. Given this gap in expected versus actual  MPS results, a significant trend for 2012 and beyond will be a focus on change management and strategic contract negotiations.

Another major trend growing within MPS, but only successfully deployed by a small number of providers, is Stage 3 and 4. Most MPS providers can deliver Stage 1 and 2 but have restrictions either in geography or in the size of account they can actually manage. Others can deliver globally and across the enterprise but have difficulty scaling their solutions and pricing down to the small-to-medium business community. A small group of companies have mastered the ability to deliver to any size organization, anywhere in the world, but among this group the weakness seems to be in Stage 3 and 4. Companies with a wide reach and the resources to deliver to any business,  regardless of geographic location, have only been able to successfully deliver in Stage 3 or Stage 4. That sounds odd, I know, but the truth is some companies have a perfect program for changes in business processes, end users behaviors, and organizational or cultural change while others have a stronger program related to infrastructure, enterprise architecture, and looking at information technology as a strategy rather than a cost center. A small number of MPS leaders have recognized this last hurdle in the delivery strategy and are moving aggressively toward addressing  specific weaknesses.

The race to provide an MPS offering absent the shortfalls exposed above will be a significant trend for 2012. The development of MPS programs that include strategies for each of these customer profiles along with a parallel focus on organizational and infrastructure or technological change management will determine the market leaders. There will be an increased focus on the integration of IT into strategic planning rather than just providing the tools to meet operational goals. The most successful MPS providers will be the ones who have the knowledge, resources and tools to assist IT and business leaders in this transition while also managing the Stage 1 and 2 migration and Stage 3 business process improvements.

To make this possible, and another trend for 2012, will be increased collaboration and acquisitions among MPS providers. Many organizations recognize they cannot organically grow this type of program with zero market gaps at the speed the market is maturing. Organizations that do not make acquisitions will likely develop more tightly integrated and strategic relationships with partners who can address areas that are currently a weakness.

The most important trend for 2012 will be an increased understanding by customers who have been through one, two or even three iterations of MPS contracts over the last decade. Lessons learned by these customers will also lead to an increase in their demands. Customers who were early adapters to MPS have learned from the good, bad, and ugly of their previous contracts and are requiring more of their vendors and partners. This push from keen consumers will help to mature the market as well. The unique requests we see from customers who embarked on MPS early but are still looking for the positive business results they expected years ago will likely push the market further in 2012, especially in regard to the contract components discussed above (change management and mutual accountability). Though this is a small group of customers they will have a big impact on trends, requirements and expectations in 2012 and beyond.

The last trend to look for in 2012, and I hope this is not just my wishful thinking, is a trend toward formal education, training programs and standards around MPS. There have been a few training and certification programs popping up for MPS but the adoption of these programs has been limited. There is a focus on standards by the Managed Print Services Association, which should help establish industry standards, best practices and statistics in the coming year. Development of training programs including universally accepted and realistic expectations and metrics for measuring success will help sales teams have more meaningful and strategic conversations with customers. As a result of the right message, MPS professionals will also be able to get through to the right level contact within their customer’s organization…something that has been a struggle for many until now. MPS is an enterprise strategy and needs to be sponsored in the C-suite to have the best possible outcomes. As MPS sales professionals develop their understanding of the importance of MPS Stage 3 and 4 the relationship will quickly move from sales calls to functional departmental leaders to the C-suite.

Thank you for taking the time to read MPS Stage 3, 4, and Beyond: The Ongoing Evolution. Make 2012 your best year ever.

Charity Parsons, Market Development Manager, Managed and Professional Services within Ricoh’s Strategic Marketing Division, is responsible for understanding customer needs and market trends to continually enhance Ricoh’s ability to bring best in class solutions and services to our customers today and in the future.

With more than 15 years of experience in the technology solutions and services industry, Charity has held positions in consulting, sales, project management, and marketing. Charity also holds an MBA with a specialty in Healthcare Operations Management along with Imaging Architecture and Change Management Certifications. Most recently, her focus has been on solutions and services such as business process consulting, IT Services, and Managed Document Services.