by Raegen Pietrucha
Anyone in the print business who isn’t aware at this point that managed service providers (MSPs) are entering the MPS space — and are even being assisted by old industry players to do so — must have been living under a boulder the past few years. “We’re definitely seeing more and more MSPs adding print to their mix, when they started out without it,” said Don Jones, senior partner and principal technologist of Concentrated Technology, an IT consulting firm. What’s behind such a major shift in this space?
Outside of the fact that they’re being actively pursued as clients by some in the print industry, several drivers are inspiring MSPs to enter a new domain for them: one filled with printers, all-in-ones and copiers. Few businesspeople in general would turn down the opportunity to make more money, and in economic times like these, most MSPs are especially eager to jump on the MPS bandwagon. “It’s such an obvious add-on sale, … (so) many providers will pick it up just for the incremental revenue,” Jones said. There are other incentives too, though — some of which are even more critical to a business’ success and longevity than offering an additional service to make a couple extra bucks. “(MPS provides) an opportunity to become more crucial to the customer,” Jones said. “The more crucial you are, and the better a job you do at it, the less likely a customer is to walk away from you.” Owning the relationship with the customer comes first and foremost with MSPs — a part of their code that seems to go without saying. “Ignoring print is almost doing your customer a disfavor,” Jones explained. “You’re forcing them to go to a second vendor or to handle it themselves, which isn’t what an MSP is in the business of doing.”
While traditional MPS dealers are adopting this same mantra as they move from the old transactional to the new solutions type of business model, this is not the only thing that separates them from MSPs. The brains of MSPs tick differently than their print counterparts, and those perceptions come to bear on how MPS is defined and delivered to the former’s customers.
For one thing, MSPs like to avoid as many problems as they can before they occur, so they tend to be more preventive in their service approach, said Steve Copeland, founder and CEO of Manage My IT. “(Traditional MPS providers) will come in and check on things, (but) they’re checking on things to see how many … copies have (been made) — not if the printer’s actually functioning the way it should — or they’ll respond to a ticket,” he said. “Something that we brought to the table … is really simply to be proactive: ‘Why don’t you show us what you do to clean this piece when we go out on our regular monthly visit?’” Checking on the function of print devices during routine client visits or while responding to service calls for other equipment are tasks MSPs are in a unique position to perform. And frankly, when printer/copier problems do arise, they’re likely receiving the calls anyhow. “We understand the network,” said Ralph Blanco, CEO of Executive Computer Management Solutions, Inc. (ECMSI). “When you send a copier person out there, they’re not that network-savvy, so our customers call us anyway. They have no idea why they can’t print; they just know it’s not printing. So we end up troubleshooting it anyway.”
Additionally, because they handle all types of equipment (from servers to phones and more), MSPs are comfortable with the idea of running into a mixed print fleet consisting of many different types and brands of devices — and keeping it that way. “It’s always going to be a blended solution (that) will be the best (MPS) solution,” said Mike Novotny, president and CEO of Intertech. “Are you looking at this as a play to sell printers, or are you looking at this as a play to sell professional services? There’s a distinguishable difference.” Jones agreed that brand-agnosticism is key to MPS success today.
Incidentally, this approach not only allows MSPs to bring in the best device for the job, but it also enables them to deepen their relationship with clients as a trusted advisor, because they are perceived as being more interested in customer satisfaction than selling a particular brand of products. And once that relationship is deepened, an even greater number of doors to additional service offerings open. “It really becomes what we call an additional, stackable managed services recurring revenue stream that you can put on top of your managed services clients’ existing requirements,” Novotny said. “The need is there, and the convenience and ease of use drives a lot of that in the managed services space.”
This reinforcing pattern is allowing more and more MSPs to take the cake with customers — MPS being just one of many vehicles they’re using to get there. Here are the paths three MSPs — ECMSI, Intertech and Manage My IT — are traveling down toward MPS success.
ECMSI: Starting out simply
Like many MSPs, ECMSI was familiar with receiving printer error phone calls long before the term “MPS” was even coined. The company had thought about managing the devices for years but couldn’t find the right fit — in the form of a partner program — that would provide ECMSI with the ease of use it was looking for. This year, however, its search ended; using OKI Data’s Total Managed Print (TMP) program, ECMSI is going beyond the general printer repair it was previously performing to monitoring supply levels and replenishing consumables for its clients automatically. “That’s just one additional thing that they don’t have to deal with,” Blanco said. “(Furthermore), having to deal with one vendor instead of multiple vendors (is easier), because again, … when (customers) call us, we’ve got to manage the whole process anyway and call the copier company out to work on the issue. If that’s the case, it’s easier for us to drive our own resources there and work on the issues (rather) than wait on somebody else.”
Moving away from charging a flat monthly fee per device for printer maintenance, ECMSI has decided to adopt the copier industry’s cost-per-print model. “If we can provide (customers) a print per page cheaper than they could buy the toner, and we could make a profit off the print per page, that’s (a) profit margin that we’re making (going forward) that we don’t make (now),” Blanco said. Interestingly enough, although the profits to be reaped from MPS are obviously clear to the company, ECMSI has chosen to focus its MPS efforts strictly on printers at this time — mainly, Blanco said, because there are more printers in the field, so naturally, more service calls are related to those devices. “There are many more printers out there, so it makes it more cost-effective for us to throw that into our business,” he said. Plus, from a service-level perspective, copiers are more difficult and expensive to support, he indicated.
Leaving this door open, is Blanco at all concerned about a competitor — in the form of a copier company — coming in and stealing his business, print-related or otherwise? Not really, he said, and his reason is twofold. He thinks in the future, as MPS continues to evolve, more pages will be shifted away from copiers to printers anyway. More importantly, though, he’s confident in the relationships he’s built with his clients as their trusted advisor. “In my opinion, I built strong, trusting relationships with my customers; if I’m not successful doing that, they’re going to shop anyway,” he said. “I could have that concern now with anybody who comes into one of my organizations and says, ‘We offer managed services, and we’d like to take over your accounts.’ If I don’t have that trusting relationship, (regardless) of if there’s copiers or not in there, that door’s still there. (But) if (my customers) feel they have a trusted advisor, they’re going to stick with me based on our history of quality support and services.” Besides, never saying never, Blanco indicated that perhaps down the road, as ECMSI gets its feet wet managing printers through the TMP program, it may one day decide to take on copiers as well.
Intertech: Letting customers choose the best services fit for them
Having been running a network operations center (NOC) for decades, Intertech found itself well-prepared to start offering MPS in addition to its other managed services. With the infrastructure and remote monitoring resources already in place, the company simply added print alerts via Ingram Micro’s Print Audit solution to the list of daily tasks it manages. “In essence, (we were) already monitoring alerts 24/7 as it is,” Novotny said. “Managed print services was a natural progression for us to move toward to obviously capture more of the recurring revenue.” When supplies run low, Intertech either dispatches to the deskside or delivers the consumables itself. And when repairs are needed, depending on where in the U.S. the client is located, Intertech will leverage either its own corporate-owned service center employees or Ingram’s service network to do the work.
Novotny noted that Intertech’s MPS program has already evolved from being simply an additional managed service the company provides as part of its larger package to standing alone as its own professional offering clients can engage independently. And just as some clients do better with a broad managed services offering while others manage well with MPS alone, there are different benefits Novotny recognizes that various clients will gain from implementing an MPS program; this is largely dependent upon the size of the customer. “As you get into the midmarket space and the enterprise space, … you get into being able to quantify and justify from a true monetary perspective the total cost of ownership and drive those efficiencies into (a customer’s) installed fleet,” Novotny said. “The rule of thumb we use is, you’ve got to have at least 25 to 50 users — somewhere in that range — as a starting point to really be able to articulate any real beneficial cost savings. Below that level, it’s really a convenience factor. You don’t have to worry about toner, you don’t have to worry about equipment maintenance; we’ll provide that all-inclusive, all-you-can-eat (service).” So whether it’s delivering cost savings, convenience or both, Intertech’s MPS program has something great to offer clients both large and small.
Manage My IT: Covering all bases
For Manage My IT, the move into MPS was ultimately a function of the incredible shift in printing equipment technology. “As soon as (a print device) was on the network, it became my responsibility,” Copeland said. Turns out the move into MPS fell right in line with the company’s — and many MSPs’ — governing business principle of trying to manage everything for customers, and Copeland indicated that it was easy to get clients to buy into the MPS offering because they were already happy with the company’s current bundle of managed services.
Manage My IT handles the purchase and maintenance of printers itself, charging clients a monthly fee for the service, and it’s partnered with a copier company that shares its business philosophy and was comfortable billing for the big-iron services through Manage My IT. This latter condition was of particular importance, Copeland indicated, because guarding its business is as paramount to Manage My IT as keeping its clients happy — and in fact, the two are inextricably linked. “If you’re not in (the business) of providing everything to your client, you’re not going to survive because there are bigger companies coming in doing it better, cheaper,” Copeland said. “How do you … truly own a relationship with your client? You own every single piece of equipment in there. I think that’s really what people always wanted in … their technology partner.”
Just as traditional MPS dealers have seen the proverbial writing on the wall when it comes to new competitors entering the space, so too have MSPs like Manage My IT seen the convergence of the various managed services, and Copeland is taking some steps to ensure his company’s survival — because when the traditional printer/copier companies start offering managed services, if MSPs don’t own everything in their clients’ environments, they will be vulnerable, he said. “I sound paranoid, … but the reality is, at some point or another, (MPS dealers are) going to do managed services, and … something’s going to happen where (clients) are going to bring someone else in,” Copeland said. “I’ve just been doing this too long, and I’ve seen it happen every time.” Offering all services and keeping in constant contact with clients are therefore absolute musts. “If (providers) are not taking the steps to make sure that they’re in front of that client every day or every week talking to them about something, … someone else is going to be, and they may know a managed service provider or a copier company,” Copeland said. “Everybody has friends, … so it becomes, ‘How do we engage with (clients) so that nobody else walks through the door at any given point?’ Because once (companies) do, then it becomes a price game, and nobody wants to play the price game.” It’s interesting to note that this concern about commoditization — so familiar to the print industry — is clearly shared by MSPs as well.
MSPs’ involvement in MPS today: Some bounds, more leaps
While it generally isn’t the case with print providers at this point, some MSPs still have their heads in the sand, unaware or apprehensive of the transition and convergence occurring in the marketplace. “Things are changing within IT or within any technology side of it, and as a managed service provider or VAR or anything, you need to do more for your customers than previously would’ve been done,” Copeland said. But truth be told, for those MSPs in the know, the challenges they’ll face entering the MPS space stem not from any real handicap, but from fear — of the unknown and the known.
There’s no denying that the number of MPS opponents out there is increasing daily from all sides. “It’s a competitive space,” Jones said. “There are entire businesses built around selling print services, so smaller MSPs especially may ignore the print market because it has a high perceived entry effort. If you’re mainly in the business of outsourcing desktop support, email and so forth, it can be incredibly tempting to just let the established MPS vendors have it, … (but) smart MSPs will at least have a relationship with an MPS provider so that (they) can at least get referral fees for bringing someone into an account.”
Like most businesspeople, MSPs are busy, and if they happen to be one of those smaller companies, they may not have their own in-house resources they can focus on MPS, which is why Jones’ suggestion might make the most sense for some. “It basically comes down to support,” Blanco indicated. “Do you have the resources to support it? Do you want to get involved in large copiers? Because when you deal with copiers and customers that use those quite a bit, you can’t be down for a very extended period of time. You’d better be able to provide the right service for those types of equipment.” The management of any new service is challenging for anyone, though, and especially given today’s technology and potential partners in the field, it’s infinitely easier for MSPs to jump this hurdle.
Although there’s never been a better time for partnership in the space, it’s important to get those alliances right, because there is a general belief on both sides of the fence that such relationships will end up becoming adversarial — and with good reason, Copeland said. “I think (these partners) start with the best intentions, … (but) the second there’s a problem, it becomes an adversarial relationship,” he said. “The problem is that too many people get into partnerships where they don’t know and understand and define a true partnership. A partnership is what’s fair, and ‘fair’ means it’s not fair to you or to me; it’s unfair to both sides. That’s actually what ‘fair’ means; it’s a compromise. It’s not: ‘I’m making this, and you’re making this.’ It’s: ‘Alright, what are you going to handle? What are we going to handle? What happens if this happens?’ — actually sitting down … and defining it, making it a true solution. If there was an IT person there, then you would do that with them. What we’ve found is that by working together with each other prior, … we don’t have those same issues; in fact, the client’s just happy.” Copeland reminds us with this statement that, no matter what type of provider you are, customer satisfaction should always be the primary goal.
As the three IT companies above have clearly illustrated — though it may come as disappointing news to the traditional print industry — MSPs actually have a lot going for them, should they decide to make the move into MPS. They tend to have deeper, proactive, solutions-based relationships with C-level people as opposed to the brand-biased, transactional ones with purchasing agents that print dealers have traditionally had. A more comprehensive understanding of the entire IT environment as well as how to best optimize it are a couple other talents MSPs possess. “The skill set and the depth of the bench (with) the managed service provider is far more advanced,” Novotny said. “You’re talking about a wide range of technology understanding that the managed service provider has versus a very narrow, select-piece-of-technology understanding that the managed print services or copier dealers have.”
So unless traditional MPS dealers catch up and learn these skills as print devices continue to evolve, they’ll have to rely upon other people — like MSPs — who can handle the network and complete the equipment circuit. “Today’s copiers … are highly network-integrated,” Jones said, “(and) whom would you rather have do that integration: the MSP who handles the network for you, or some copier salesperson who knows nothing about your environment?” And if MSPs are going to end up fielding these types of calls from print dealers and clients alike, they might as well handle the whole shebang themselves — and get compensated for it. They won’t be up against much resistance on the client side. “It’s actually more of a natural progression … (and) a much easier play for a managed service provider to pick up managed print services as an offering than it is for a managed print service or copier company to (say), ‘Hey, let me run your entire IT department,’” Novotny said.
So whether you’re a print dealer needing to pick up a new skill set or an MSP who’s worked up the courage to face the challenge of offering MPS, prepare to make a big and swift change, because the face of MPS, the faces associated with it — even those of the managed services industry — are transforming quickly, and you just never know who might appear in your client’s doorway next.