Issue #0504/1 - More companies are adding print management to existing services contracts, huge sums of money are at stake.
Pay-per-page print services are fast becoming the financial solution of choice for print management in the corporate sector.
While vast sums are up for grabs as corporations and other large bodies extend, enhance or renew service contracts, more organisations are investigating Total Print Management as a concept.
This week it is reported that London’s Metropolitan Police has called in Capgemini to compete with incumbent services provider, EDS, for a contract renewal. It is not know whether this contract will include print management but Barclays Bank recently announced that it is engaging the services of EDS and Xerox to manage its entire print, copy and fax provision under the banner of the EDS/Xerox co-brand, ‘Managed Output Services’.
Worth £33 million, the contract will cover the new Barclays worldwide headquarters in London, together with around 200 Barclays sites across the UK. This agreement is actually an enhancement of an existing IT services contract between EDS and Barclays, signed in June 2003, that is worth a huge $350 million over a seven-year period. At the time, this was the largest Services contract ever awarded. This extension runs for the remaining five-and-a-half years of the contract.
Although a small part of the whole contract, Xerox’s involvement will be to handle hardware procurement, service and maintenance of a fleet of some 2,250 hard copy devices across the Barclays sites, together with user support and help desk functions. The goal is to improve productivity while reducing overall spend on hard copy output.
No doubt any news of this nature is heartily welcomed by multi-national IT outsourcing company EDS, which is reported to be ‘creeping back into the black’ after showing profits of $88m for 2004 after losses of nearly one billion Dollars in 2003.
Other corporations that have specifically targeted print management recently include the motoring giant, Ford, which appointed Hewlett-Packard in the middle of last year to rationalise its hard copy fleet by installing network MFPs in an attempt to combat the inefficiency caused by the proliferation of printers, laser and ink jet, that found their way into the company over the years.
It is reported that Ford places estimates on print costs within the company at around £436 per employee per year, while other figures mentioned include print volumes (including copy) of about 26 pages per employee per working day – totalling about 5,750 pages per employee per year.
If these figures are applied to a company the size of Barclays, total spend on print very calculates out to a figure of just over £33 million per year, with visible costs of around £8.8 million (based on typical CPP of 2.0 pence, including cost of hardware, consumables and paper for an A4 workgroup mono laser printer) for almost 440 million sheets of paper used.
These visible costs amount to about 25% of total spend, meaning that administration (e.g. cost of purchasing consumables), user support, training, fleet management, etc., would account for around 75% of costs, or £25 million per year worldwide to a corporation like Barclays.
Please note that these calculations are based purely on costing and usage figures gleaned from published materials and other research and are in no way intended to be an accurate representation of the true Cost of Printing for Barclays.
Reducing print costs is not just about reducing the cost of consumables or even about consolidating the hardware that is used.
It is partly about defining and implementing an efficient infrastructure that coordinates the right number of devices in the right locations within the organisation. However, it is also about what is printed and what is not printed, together with where and how it is printed.
Huge quantities of emails are printed simply because users find it easier and more user-friendly to read off-paper rather than off-screen. Only this week an associate commented to me that all his emails are printed for ease of reading and other estimates have placed the proportion of emails that are printed at 85% with the average number of times an email is printed being as high as 15.
These figures seem extraordinarily high and something that I, personally, cannot identify with. The only emails that are printed in my work environment are those that I either need to take on a travels with me (usually for directions or other reference purposes where a laptop is not an option) or that I need to show someone to whom I cannot forward the email. This generally amounts to about a handful of messages in a year, something like 0.0025% of my emails!
Other hotspots in Cost of Printing are PDF files. Many PDF files place high demands on the network as hundreds of megabytes of data are thrown at the printer for printing of high page-coverage documents that are toner-hungry. Again, in terms of PDF documents, TCPglobal never sees the light of day – only the light of CRT – in my office.
While cutting print out altogether is not always an option, or even desirable, there are nevertheless vast quantities of paper and toner that could be saved where hard copies of documents are not absolutely necessary.
The main point here is that a rounded, balanced print management assessment would include determination of what needs to be printed and what does not, together with the assessment of how to print the essential output for maximum productivity, efficiency and economy.
For instance, can your organisation guarantee 100% uptime of its hard copy provision? I must emphasis here that there is a major difference between 100% uptime of the printer (i.e. hardware) and 100% uptime for the provision of the print facility.
A software solution that automatically redirects print jobs in the event of hardware failure is worth its weight in gold to a major organisation with mission critical hard copy requirements – and very valuable to all other organisations. It is nothing for a print job to be collected from a different device by the user, as long as that print job is printed successfully without time consuming delays and the extra effort of having to resend the job or wait for the failed device to be fixed.
There are, of course, many other factors that require attention in undertaking a review of hard copy provision, many of which have been covered in various issues of TCPglobal. Gartner issued an estimate last year that, by the end of 2005, around 60% of companies will have evaluated their hard copy provision with a view to reducing the Total Cost of Printing.
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