Day 2/ Session

Outsource your printing needs

Alok Bharadwaj, Senior Vice President, Canon India talked about the company's latest offering Managed Print Services

The Managed Print Services concept is not a new one in terms of understanding and knowledge but a new one from the perspective of adoption. First of all, organizations have this big objective to continuously want to reduce costs in every area of business for sustained competitiveness. Organizations want to use technology deployments and outsource to domain experts to rationalize their resources and to be able to focus their attention on business strategy. Organizations have to invest in green technology. Where can we save energy for the world is renewable and it will take several decades before it ever becomes so and we can take the liberty of not bothering about energy consumption as a part of Corporate Social Responsibility.

This time we decided to do things differently and we thought we would meet with some of you and understand your perspective and see whether in some way or better ways we can align our propositions. We met with 21 CIOs in roundtables before Tech Senate and about 70 through questionnaires. What we found were the common observations. “Don’t know exactly how much is the print cost.” It’s tough to recall and know as it doesn’t get monitored that frequently. We know that it is high and that it is increasing but we don’t know. “In the evening we see many unclaimed printouts lying in the printer. What a waste and what an opportunity for information leakage.” Although electronic leakage of secure information is possible, there is an audit trail and people get caught. If not the person, at least the fraud is spotted. The easiest way to smuggle out information intentionally out of an organization is through hard copy. It doesn’t leave a trail and people can walk away with information.

Multiple print devices have caused fragmented printing in the organization. There is a need to control print activity. “We have no idea who is printing what or how much.” Another comment was that there are lots of devices in the organization and we know that they all need to be controlled but we don’t know how to do this. They added that lots of hard copy documents are entering into our organization. This is now from the hard copy movement within the organization. We need to share many hard copies. There is a lot of information that is there in the form of hard copies but is invisible to many parts of the organization because it is in a file with somebody. Repeatedly, year after year, the same activity gets done and this knowledge base which is an extremely valuable asset is not transparent and is invisible. Control on hard copy flow within the organization is required. Storage, archival, retrieval of hard copies is also a challenge. We are looking at someone to take a complete contract for all locations regardless of where we are located. It is easy for us to sign up a contract with a large organization but we have manufacturing plants in remote locations and sometimes the SLA and expectations there are lower. We are unable to get the desired benefit. A few felt that we can now move the entire document management onto the OPEX business model.

These were some of the observations that we got. We looked at wisdom from around the world and found that it mirrors the sentiments and the observations that the CIOs made. For instance, 90% of all companies do not track printing cost. Companies can lower their printing cost by up to 30%. If this is adopted, even before an investment is made there should be a guaranteed cost saving. Hard visible costs are only about 10% of the total document cost.

I was in a discussion with the CIO of a large bank the other day and I asked about the printing consumable cost and one of the predicaments that he was in that it is tough because some of these expenses are invisible. They get into sundry expenses, they get decentralized into branch managers, and they buy some of this stuff through the Misc budget. Therefore only 10% of the document cost is visible. Companies spend 1-3% of their revenue every year on output fleet, the printing and copying part of fleet management.

Cost, is the most important. Any tech deployment has to offer some cost advantage and maybe productivity enhancement at the same cost. Confidentiality is another attribute that is desirable. Convenience of users comes next. Most important is control. Unless we have control, we can’t measure. If we can’t measure, we can’t monitor. If we can’t monitor, then we can’t manage.

There is a need for a comprehensive approach to document management services. It begins with consultancy because our actions as an organization have to have the long term perspective in mind. It is important to make an assessment of the current state which is what is required when the whole thing is started properly and new ideas are recommended based on the organization’s requirements. There are numerous functions in hardware solutions and sometimes we as vendors are guilty of recommending oversized products for a lower requirement. Everything comes at a cost. It is vital to see this in its totality. Each of us has some kind of contract on the maintenance service but in isolation. Analytics and monitoring and document print outsourcing come under management services. All organizations have the requirement of printing brochures, training manuals, and other bulk printing. This is sometimes delegated to the marketing department or different parts of the organization and prices vary. Some office may be printing something for Rs 10 per page while somebody else may be printing at Rs 8 and someone at Rs 15. There is considerable scope for standardizing this by doing document print outsourcing at a contract value that can last for a longer time across the country. We can put this in two categories—there’s scanning and document flow. This ensures the hard copy movement. Each one of us has hard copies getting into our organizations and we can’t stop this. Faxes, purchase orders, legal documents etc. will keep coming to us. New account forms will have to be signed. Complaints will keep coming to us as we move into smaller towns and expand our business through the country.

The best thing that we can do is to deploy systems and approaches to capture hard copy. It’s almost like saying that there’s a window in an organization. If you push a hard copy in it, it is not given to any desk. It is scanned. Then it moves to a desk through the workflow. Then it can keep on moving—it gets captured, it gets stored, it gets archived, it gets tracked, and everything. The whole efficiency of the organization can then be assured. The second part is management services which is the output side. We look at this in two dimensions. If you look at the suppliers, these days we say that there are facility and asset management vendors which supply us things such as air conditioning, catering and all that stuff. Print and copier vendors are there. Then there are IT systems and network vendors. Now telecom, broadband and those things are also coming in. When you look at it from the user perspective, we have general affairs department and we have an IT department. Between these two departments, these things get managed. When you look at this space, this facilities and asset management falls entirely in the Facility Management space. The IT part or the telecom part all falls under what is called IT management Services space which is hardware, ERP, contracts, maintenance, networking and all that stuff. It is somewhere in between that this space has emerged that all the organizations are doing in bits and pieces which you can call the Managed Print Services space. Like you have IT strategy and Facilities strategy now you have Print strategy. The advertising and promotion (A&P) expense for a mature organization is somewhere around 4-5%, which is what impacts a customer and is a critical expense. If 3% is the print expense it is a huge one.

The hard copy general expertise area and the managed print services domain and if you go a bit further you would have the document print outsourcing part. All the telecom bills that we receive every month, credit card statements, all of this comes from banks that outsource the printing requirement to the domain experts. Many organizations have contracts that go into document print outsourcing. This whole space is what we are talking about in the form of managed print services and document print outsourcing.

We have launched Canon Document Management Consultancy services. This has been there in the developed world for the last few years. Now we have launched this in India. For the last six months the organization was realigned to take care of this particular requirement and now we are ready to handle and scale up to the huge load that can come from organizations such as yours. In Phase I the Managed Print Services, and in Phase II we are going to be doing Managed Workflow Services, which is the scanning part. This has been launched formally on August 4th after six months of trials and this is the plan for next year. We should be able to align with your output management immediately and your input side of the information which is the hard copy scanning of the workflow we will do it from next year onwards.

Canon is taking over the customer’s entire print infrastructure and offering appropriate print solutions, management control and services. Everything comes to you as a service and you pay for the print solution according to usage. Canon MPS is sold with consultancy as a starting point. Without the consultancy, it doesn’t work. A single point of control and complete accountability outsourced to an organization such as Canon. Let’s understand the aspects of MPS. There are three main aspects namely assessment, optimization and management. This concept works on the basic premise that when you do the assessment of the current situation, the legacy of the printing devices has evolved over several years in bits and pieces. You buy a printer based on any new load that has happened or the requisition that comes from different departments. Over the years you create a huge network of a large number of printing devices. So they may not the most optimal. They may not be getting a load suitable for that specification. They may not have solutions that transfer the load across; they are all standalone connected to some users etc. They may not be secure. You do the assessment first.

Next comes optimization. When the optimization is done we must immediately see what the cost benefit is. All invisible costs have to be incorporated in the assessment and in the optimization all potential costs that get incurred become part of the contract.

Then the third part is management.

The CIO may not want to do all three at the same time so it happens in stages. Stage I is called a health check up. Stage II is print optimization. Stage III is enhancement beyond print. So many enhancements come with the technologies nowadays but from the user perspective they don’t get covered. For the current paradigm is that you buy the machine, compare with the competitors, look at the cost, negotiate the price and go and buy it. Some features that are important don’t get deployed properly. This whole thing can be broken into five levels of engagement. We call it Discover & Analyze, Design, Deploy & Transition, Support & Management and finally, Evaluate & Review. We need to know almost every month as to how this so-called optimized network that was created is delivering. It must show us some of the data points. These are important to evaluate if we need to make some changes in the whole system.

A level 1 engagement has 21 elements of how we do this analysis. We do a basic audit of the current devices and the floor plan. Even the movement of people on the floor where the device is kept is important in deciding the print strategy. It is important to collect information about all the assets that are there in the organization. Asset utilization also has to be looked at. Current document flow looks at how are documents moving around, what’s the security status, is it possible that when somebody fires a printout we have an audit trail, somebody is leaving the organization and it is his last day do we know what prints he took, is there a way to control that etc.

The first level might take a month or two and it comes with a proper consultant’s report saying that this is what your organization is doing today and these are the points where the cost optimization needs to be done. These are points where device optimization needs to be done.

Level 2 is a design engagement. Process, devices, software, system and cost optimization takes place here. That requires change management. If you study the printing in any organization there are two or three things that will be common to all of us. The first thing is that most of the print which is done after 6 pm or on weekends, half of them are for personal use. There’s a spike at that time. There is so much of printing where the prints are just left lying there. So much of confidential information gets leaked in this way. Lot of prints are fired for internal consumption—for a flight, the agenda for a meeting... That print should have been a duplex print job, it is not. Devices are not configured to handle duplex printing by default. Many of the prints are color prints. Only one line is color, but the cost is still high. So who is authorized to use color? By default we are doing black and white, we don’t want to remove the delegation and authorization of freedom but at least by default it is black and white. Some of these simple steps can result in huge savings.

Uncover and remove hidden costs in the administration of devices and consumable management. You have 600 devices or more in different branches, senior people with their own devices. There will be different models, using different consumables. If you want good service these consumables need to be kept there on site. Imagine the inventory of all those different combinations.

In the third level engagement of Deployment & Transition, it is treated like any large project, like a metro. You know at what time which machine is going to be changed, how this networking will be done... Change management and training is an important part of this level. Wherever we have done trial runs in the last six months we have learned that the pain points can be avoided by properly preparing people. We create posters and put it within the organization ‘From next Monday you are going to see a new XYZ’ or ‘Your organization has adopted Green technology’.

When MPS is talked about you can’t have multiple contracts. For your IT management and network I guess you have one guy who does it. You can’t have bits and pieces.

Some organizations tell us that we need 24x7 mission-critical support so an on-site person is required. An e-maintenance system has been launched by us where all the network devices are connected to our system and we would know which printer has stopped working and before we receive a complaint the necessary spare and engineer is deputed. Consumable management and fleet management, bill details breakup all come under this level. Some BPOs as customers do printing for their US customers and they insist that they need all the actual expense and so these BPOs need the billing details.

Finally, there’s Evaluate and Review. There are many case where the print load after a month when the review is being done, the CIO feels that the particular device that you had put was required for 20,000 prints a month but we notice it is only 10,000. So maybe the calculation has gone wrong with the result that you have an machine that exceeds the spec there. There is this machine which is being over used so it will have a shorter life. So over the weekend the machines can be interchanged. The contract is for three years during which time upgrades will be done and technologies renewed.

MPS reduces your cost, improves your document processes, enhances your employee productivity, and creates a greener work environment. When you have 600 devices all of them are working standby and so much of toner going to waste, consolidation of printing is required and MPS offers that.

We have expanded our software solutions portfolio. There are solutions that, when things are scanned on one end, they get put into a respective folder, go directly into the e-mail etc. There are solutions which we call Follow Me printing. When you fire a printout it doesn’t go to a printer, it goes into a server and whichever machine you go to you just punch in your password and take a printout.

We have our own direct sales people and service engineers in about seven cities. We appoint them even in the manufacturing sites of large enterprises. Enterprise Solutions Division has been formed. Our record is less than two hours response and 95% uptime on this whole network. We have created three business lounges in Gurgaon, Bangalore and Mumbai with 48 devices that are all networked, all security solutions, so that you can simulate your work environment before anything is bought.

Mindtree, Matrix, Dr Reddy, JP Morgan and Oracle have adopted this. These are heavy load organizations with 10 lakh to 50 lakh monthly volumes.

Bharadwaj introduced K Bhaskar, Director, Enterprise Solutions Division, Canon India at this point and Bhaskar closed the session.

“When we do the print health checkup we identify two segments—healthy zone and unhealthy zone where you have lots of printers and scanners that are scattered with no proper control. In the former you have MFPs that give you complete control of print, scan and fax in one go. After doing this checkup we are in a position to tell you how many printers are there, print loads and we devise a floor plan for your organization of how we can optimize the entire implementation,” he said.

In the case of solutions, Uniflow is more on the output data management side. For e.g. if a user prints a A5 job it goes to a Uniflow server and gets recorded. User 2 prints 10 pages which also goes to the print server and gets recorded. You can do rule based system.

In terms of printer accounting, you get all the information about the price of a job. You can specify quotas and cost centers. Every print is accumulated to the total cost and you can generate a monthly report to know what happens in the entire printing domain. You get reports on users, devices, departments, costs centers... This is rule-based routing with secure jobs.

After implementing this software, many users who were contributing to Rs 40,000-50,000 of printing cost every month were made aware of the impact that their usage had on the company. By sharing information with every user it influences them to make a correction in their printing habits to bring down the overall printing cost.

— Prashant L Rao