Managing Print as a Strategic Asset

W H I T E PA P E R

Managing Print as a Strategic
Asset for Your Organization
How MPS and Nuance Software Can Drive Productivity Gains
and Improve Business Processes

“Historically, print has basically been viewed as a necessary
but unmeasured expense: a critical business function but
not necessarily an integral business process.”

White Paper | MPS and The Opportunities Beyond Cost Per Page

Introduction....................................................................................................................................... 2

Methodology..................................................................................................................................... 2

About The Author.............................................................................................................................. 3

Executive Summary........................................................................................................................... 3

MPS...In the Beginning ..................................................................................................................... 4

Current State of the MPS Market....................................................................................................... 4

Productivity Impact ........................................................................................................................... 6

The True MPS Value Proposition........................................................................................................ 7

Printing is Not Always Bad................................................................................................................. 7

Nuance and MPS.............................................................................................................................. 8

Nuance MPS Software Solutions....................................................................................................... 8

Nuance: The Preferred MPS Partner ............................................................................................... 10

Summary......................................................................................................................................... 11

Introduction
This report was designed to help businesses of all sizes understand the ongoing transition to managed
print services (MPS), and to evaluate the potential benefits and long-term advantages of outsourcing
print requirements. The report looks closely at how MPS is currently deployed, and how a singular
focus on reducing cost per page will lead to inefficiencies in an overall document workflow strategy.
Further, the report describes how utilizing the proper MPS software can help drive printing costs down
but also create a more productive and efficient business environment.

Methodology
This report, produced by Palmer Consulting, was commissioned by Nuance and is based on a
combination of research activities, specifically:
• review of historic market trends and ongoing activities in the areas of office document printing
A
and managed print services
• ersonal interviews with office equipment manufacturers, major vendors, indirect channel partners,
P
and service providers
• nalysis of the office printing market based on current conditions, competitive intelligence, and
A
historic insight

© 2013 Nuance Communications, Inc. All rights reserved. 2

| MPS and The Opportunities Beyond Cost Per Page

About the Author
Robert Palmer is an independent market analyst and industry consultant. With more than 20 years
of experience in the printing industry, he has covered technology and business for prominent market
research firms such as Lyra Research and InfoTrends. He was managing editor for the Hard Copy
Observer for six years and more recently served as director of office document services for Photizo
Group.

Executive Summary
As business expenses continue to rise, companies of all sizes remain focused on three key areas:
reducing costs, streamlining operational efficiencies, and strengthening the bottom line. Nowhere
is this more evident than in the area of office document printing. Historically, print was viewed as a
necessary but unmeasured business expense—a critical business function but not necessarily an
integral business process.

That changed as more companies look for ways to optimize their print environment and take cost
out of the system. This increased focus on the cost of print has helped fuel the transition to managed
print services (MPS). With MPS, businesses can simply turn the entire process of office printing—from
equipment acquisition to ongoing management and supplies fulfillment—over to a third-party service
provider. In turn, the MPS provider promises to reduce the customer’s overall printing costs and
in many cases provide ongoing optimization of the printing fleet along with other document-based
business processes.

It is clear, however, that MPS should not be deployed in the same way for every business customer.
Indeed, to be effective managed print engagements must be tailored to meet the specific needs
of businesses depending upon a number of variables, including company size, document output
requirements, business processes, and document workflow. It is also best to understand that reducing
printing costs, while very important, should not be the only goal in any managed print engagement.
It is quite possible to reduce printing costs while causing significant disruption to overall productivity
and process efficiency. This is particularly true today as many businesses are deep in the midst of
transitioning their operations from traditional paper-based workflows to a more digital, and increasingly
mobile environment.

Managed and implemented properly, MPS streamlines office document strategy—driving printing
costs down while creating a more effective and productive business environment. As such, MPS goals
should not only focus on reducing printing costs, but also on driving competitiveness and, ultimately,
profitability. There are two key elements to achieving this balanced approach: understanding first how
information is captured, consumed, shared, and distributed within the organization, and then utilizing
technology and software to create a cohesive document output strategy driven by organizational
goals and business processes.

This is a radically different approach compared with today’s typical MPS engagement. Instead
of focusing first on understanding the makeup of the printing fleet, the company should work
closely with its MPS provider to first optimize business processes and document workflow
in order to manage print as a strategic asset and not just as another cost center. In other
words, create the most effective business process and workflow environment for your
company, and let that dictate your document output needs, instead of the other way around.



MPS…In the Beginning
Several market forces have fostered the ongoing adoption of managed print services—but the
economic downturn could certainly be identified as the strongest contributing factor. As the economy
slowed down, belts tightened and IT budget constraints caused businesses to look for any and all
ways to reduce operational costs. Not that long ago, businesses had little control over the printing
fleet, and even less knowledge as to the ongoing costs for document output, so printing was a natural
place to look for ways to shave office expenses. What became apparent fairly quickly was that there
was significant over capacity and underutilization of office printing equipment in the market.

Meanwhile, traditional printer and copier markets were rapidly converging. These markets have
historically been driven by two distinctly different business models: printers and supplies were typically
acquired outright on an as-needed basis, while copiers and office MFPs were leased under a click-
based, service contract. But as printer companies began to introduce more fully functional A4-size
MFPs, the lines between the two markets blurred and products became commoditized. Businesses
with a mix of device types and multiple brands struggled to manage their fleets effectively and a new
type of outsourced, service-based model emerged. As a result, MPS was born—fueled primarily by
large companies partnering directly with OEM equipment providers to streamline their office output
needs.

So what exactly is managed print services? There are probably as many different answers to that
question as there are companies who claim to provide MPS capabilities. The Managed Print Services
Association (MPSA), an independent trade association made up of members encompassing all facets
of the document imaging market, defines managed print services in the following way:

“Managed print services is the active management and optimization
of document output devices and related business processes.”

The Managed Print Services Association

Figure 1: MPS Definition

No matter how you define it, the fact is that MPS is no longer just about managing hardcopy output
devices. Indeed, MPS has evolved to include the ongoing optimization of the printing environment and
further improvements to complementary business processes.

Current State of the MPS Market
As the traditional printing market has matured, hardware sales and print volumes have steadily declined.
Businesses that compete in this industry are actively looking to transform—shifting from products
to services to help stem the loss of revenue and profits from shrinking supplies sales. Equipment
vendors and channel partners alike are looking to MPS as the growth engine that will help sustain the
printing business, and virtually every equipment vendor now has some form of managed print services
offering, some of which are more extensive than others.



Most agree that MPS engagements fall into three broad tiers, which have increasing scope and
strategic value to the organization. There may be slight differences in the number of stages or tiers,
and perhaps some alternative views on what constitutes each, but the general premise is the same.

Figure 2: MPS Engagement Tiers

Tier 1: Assessment of the Print Environment
• nitial
I assessment, conducted pre sale that focuses on installed hardware and
print volumes from installed hardware in order to establish a baseline for MPS
contract terms
• ngoing assessment of print activity, including user behavior, and performance
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analysis against MPS contract objectives as the print environment evolves

Tier 2: Optimization of the Print Environment
•
Focuses on putting the right devices in place, and actively managing the printing
fleet on an ongoing basis
• ddresses strategic questions such as centralized versus distributed printing,
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printing versus scanning, mobile access to printing, etc
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Tier 3: Process Improvement
• ocuses
F on leveraging the print environment to improve business processes,
often by adding complimentary functions–paper and electronic document capture
and workflow–to the core print -management capabilities

Of course, the deployment of MPS varies depending upon the provider and upon the customer’s
needs. Still, the MPS tiers described above represent a fairly well accepted approach to the market
today. It is also important to note that these tiers tend to be viewed as a means to migrate customers
further up the MPS adoption curve. In other words, the most recognized strategy today is to engage
a customer at a Tier 1 level for basic fleet management services, before moving them further up
the value chain to eventually providing process improvements or other non-print-related managed
services.

MPS has grown significantly over the past few years. According to independent market research
firm IDC; global revenues from MPS reached $11.03 billion in 2011, with hardware (printer and
MFP) vendors accounting for 73% of the total, while the channel (dealers/resellers and professional
service providers) accounted for 27%. Most market research firms, including IDC, predict double-digit
compound annual growth for MPS over the next five years. Vendors look to capitalize on the growth
of MPS but they do so by leveraging the “reduced cost” value proposition to take market share from
their competitors. In many ways, the entry-level market for MPS evolved to become a “land grab”



strategy with vendors and other providers utilizing MPS as a way to steal pages from their competitors
by offering to manage the customer’s fleet at reduced costs. Once the MPS contract is in place, the
intent is to convert existing installed machines to a different device type and/or brand over time.

Productivity Impact
As popularity and penetration for MPS continues to grow, office equipment providers and their
channel partners push MPS to small- and medium-size businesses (SMBs). However, for many of
these providers the value proposition remains unchanged with the focus on reducing overall cost-per-
page, often with little regard to the impact on productivity. The dangers with this developing trend are
twofold. First, many businesses looking for immediate cost savings from MPS may not see the kind of
results they desire simply because their current printing costs are fairly low relative to other business
expenses. A 20-30% reduction in printing costs for some businesses might provide very little impact
to the bottom line.

Second, those customers who choose to implement MPS without first considering their overall
document workflow strategy stand to lose more in productivity than could be gained by reducing print
costs, regardless of the size of the organization. Outdated or inefficient business processes could
be costing companies much more in wasted effort and lost worker productivity than could ever be
recovered by making output less expensive to produce. In fact, an MPS strategy with a singular focus
on driving output costs lower could lead to further inefficiencies in overall document workflow.

For example, one way that MPS providers can reduce printing costs is through the implementation
of rules-based printing procedures. These policies can range from administrator-controlled access to
output devices or features, to mandatory restrictions and printing limitations. Implemented properly
and as part of an integrated document workflow strategy, rules-based printing procedures can be an
effective means for optimizing business processes and controlling output costs.

On the other hand, if these policies are strictly enforced with no thought given to the impact on
workflow they can cause significant disruption to worker productivity. In some cases, employees will
actually waste significant time and effort simply to avoid certain restrictive print policies in order to do
their job effectively. An effective MPS program should leverage intelligent software to encourage better
print behavior, rather than simply mandate it as a cost-savings utility. The result is a better working
environment, and a workforce that is equipped with the information needed to make proper decisions
regarding output costs versus alternative document-based processes.

The commoditization of MPS has lessened the value of print as well as the value of MPS itself.
Managed print services offer significant benefits that extend well beyond reducing the cost-per-page
for printers or MFPs. The real advantages lie in leveraging a managed print engagement to improve
business processes and create a more streamlined office document strategy—from capture, to
storage, distribution, and output. For many businesses, the cost of printing is inconsequential relative
to the process efficiencies that could be achieved with an optimized document strategy.



The True MPS Value Proposition
There is a real and immediate need for MPS customers and providers alike to move beyond the issue
of cost-per-page and focus on end user needs. It is no secret that business processes today are
undergoing significant change. The factors influencing that change can be attributed to many forces,
but the single factor causing the most disruption is the recent changes in information technologies.
Advancements in digital display technologies and cloud-based infrastructure are driving new ways of
creating, sharing, collaborating, storing, and distributing business information.

This disruptive process is being fueled by the adoption of mobile devices and by the ongoing and
rapid progression occurring in the Internet ecosystem. Proliferation of cloud-based computing and
services have created a globally connected, virtual computing environment where software is basically
decoupled from hardware—allowing individuals to maintain constant connection with all of their
business data, information, and resources. Individuals can now work from anywhere and at any time
of the day or night, basically with unlimited access to the data needed to conduct their everyday
business.

These changes in business process must be factored into any ongoing print-related strategy, whether it
is outsourced through an MPS engagement or otherwise. For example, businesses today have access
to a wealth of information that is used both for internal correspondence and for documents that move
outside the organization. Typically, multiple individuals are responsible for creating this content using a
variety of different software applications, all of which have unique file structure and formatting issues.
Dealing with incompatible file formats and consolidating content into a single document structure
either for viewing or printing can be a daunting task. An MPS strategy designed to “optimize printing”
should certainly take these kinds of issues into account.

Printing is Not Always Bad
Unfortunately, many MPS providers and software vendors today have fostered a “printing is bad”
mentality: with an over emphasis on promoting “print less” strategies, and cost per page and page
volume reductions without first understanding how these changes might impact business productivity.
There are strong environmental and cost-savings benefits from printing fewer pages, and those should
not be understated. Nevertheless, printing less with no regard as to how that might impact business
process and worker productivity is simply not the best approach.

The fact is, printing remains a vital business function. The need for printing is certainly changing, and
businesses need to understand how their printing needs are evolving—but those strategies should
drive the document output environment as opposed to the other way around. Often, printing might
be the most viable option if the data were in the proper format. Similarly, electronic format may not
always be the best solution for a paper-based workflow that does not easily migrate to digital. Any
MPS strategy should ultimately help customers and their employees make better decisions about
which vehicle for sharing and storing information is the most appropriate given the information source
and the business objective. Once again, focusing solely on the cost savings of print could lead to
inefficiencies that might prove difficult to recover.



Nuance and MPS
The real value-add from any managed print service engagement comes from addressing fundamental
problems with office documents—including page volume, security vulnerabilities, compliance risks,
and inefficient document workflows that lead to lower worker productivity. In order for organizations to
derive value from any of the three MPS tiers described above, software is an essential component of
MPS. Only the proper software can provide insight into how users interact with their printing resources,
and give businesses and their MPS providers the ability to influence end user printing-related behavior.

Nuance is one of the industry’s leading providers of MPS software. The firm’s software is available
not only as standalone tools but is also embedded in many of the prominent office MFPs from the
leading equipment vendors on the market today. Based both on revenue and geographic footprint,
the Nuance MPS software suite of tools position the firm as the leading independent provider of MPS
software.

Nuance software solutions help businesses achieve strategic objectives within their document
management and workflow environments, such as reducing print-related costs; ensuring compliance
with regulations; providing anytime/anywhere access to information; and streamlining and automating
document workflows. These are the key areas in which businesses today must focus in order to deal
with the ongoing changes in business processes and the shift to mobility. Nuance MPS software
solutions fall into three primary categories:
• Office print management
• Office capture and workflow
• Office document conversion and workflow

Because Nuance software is platform independent, it can be integrated seamlessly into complex
environments with mixed brands and device types. In short, Nuance software enables customers
and MPS providers to deploy best-of-breed print infrastructure solutions aimed at driving worker
productivity..

Nuance MPS Software Solutions
Print management: perhaps the most important element of any MPS engagement. It sits at the core
of the service provider’s relationship with the customer because ongoing management of the device
fleet is typically how service level agreements (SLAs) are initially identified in the early stages of an MPS
contract. There are many facets to print management, and Nuance Equitrac Office, Nuance Equitrac
Express and Safecom software solutions deliver on all of the prime elements that are most essential to
creating an effective and efficient document workflow strategy. Some of the features of these software
programs include:

• nly print what you need, when you need it, and where you need it. Equitrac and Safecom turn
O
the MFP into an engine for eliminating nonessential printing.
• ollow-You Printing makes network printing convenient and secure, and reduces waste of time
F
and materials by streamlining faulty network printing workflows, e.g., printers offline due to jams,
supply outages, mechanical problems, etc…, and by eliminating banner pages and abandoned
print jobs.



• ecure document release allows users to hold print jobs at the device until released with a secure
S
PIN. This feature, enabled at the MFP ensures compliance with regulations and policies; keeps
documents secure; and eliminates the need for more costly, single-function personal printers.
• ules-based printing to encourage responsible print habits that eliminate waste, including the
R
unnecessary or limited use of color, single-sided or duplex printing, etc.
• racking and reporting of print, copy, and scan traffic enables optimization of the total fleet of
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hardware devices.
• obust audit data and reports enable the development of charge-back models for document
R
workflows, and better measurement of time to complete business processes.

Capture Workflow: Scanning remains one of the most important elements of any document
workflow strategy. The digitization of hardcopy content and converting paper-based workflow to
electronic workflow remains a challenge for businesses of all sizes. Nuance eCopy software solutions
speed access to information currently trapped in paper. More importantly, these solutions have the
intelligence to scan directly to the desired system, and in the format the customer needs. Key benefits
of these software solutions include:
• liminates unnecessary photocopying, which perpetuates the “trapped in paper” problem.
E
Scanning is a more efficient, less expensive alternative to photocopying hardcopy documents.
• FP-based scanning makes the benefits of scanning accessible to everyone with access to the
M
device, as opposed to individual users.
• hared use of networked scanners is more efficient and less costly compared with personal
S
single-function scanners.
• reating scanned, searchable files eliminates labor-intensive processes, such as searching
C
hardcopy documents for information manually. According to a study by Gartner, the average office
worker spends 20% of their time searching for information1.
• ffice MFPs can be programmed so that a simple button touch can automate scanning workflows
O
such as conversion, filing, routing, distribution, data capture, etc.
• ranular data regarding document capture helps prove cost reduction and compliance in an MPS
G
deployment.

Office Document Conversion and Workflow: part of the continued process of digitizing documents,
Nuance’s eCopy PDF Pro Office / PDF Converter software helps keep office documents digital,
replacing paper with full conversion and sharing of documents in the most popular formats. Benefits
of Nuance’s document conversion software include:
• ocument conversion at the desktop and MFP provides the ability to take documents from any
D
format, to the formats the customer needs for sharing.
• eeping digital files digital eliminates manual re-keying of information. According to a recent IDC
K
study, 25% of printed digital original documents are re-keyed into computers2.
• sers who face incompatible file formats don’t have to resort to printing hard copy as a “universal
U
format” for assembling into a single document.
• ocument-handling tools streamline work with electronic files. For example, selecting pages
D
from multiple documents and perhaps in multiple formats, then consolidating them to a single
document for printing.



Nuance: The Preferred MPS Partner
For Businesses Considering MPS

For businesses looking to deploy a managed print solution, Nuance is uniquely positioned to deliver
on the “true” value proposition of MPS. The firm has helped companies around the world create
an effective document workflow strategy aimed at driving user productivity and enhancing process
efficiencies. In addition, Nuance software solutions address all of the core elements of any MPS
engagement, from assessment, to optimization, and process improvement for the output and capture
of paper and electronic documents.

Businesses need to understand that print savings, while important, should only be viewed as a single
component of MPS and not the primary target. An effective managed print services engagement
should not only reduce printing costs, but should drive cost savings in other areas such as fewer
break/fix interventions, reduced IT and help desk calls, improvements in document workflow and
business processes, and reduced environmental impact. By looking beyond the benefits of device
consolidation and print volumes, Nuance MPS software turns print environments into a source of
longer-lasting business advantage through gains in user productivity, business-process efficiency, and
document security.

Document security remains a primary concern for all businesses today as compliance issues continue
to evolve. Nuance MPS software provides tracking, reporting, and audits on document workflows
that can help minimize the risks of noncompliance with laws or regulations. Finally, Nuance is an
independent provider with strong relationships to all the major MFP vendors. As a result, Nuance is
uniquely qualified to help with heterogeneous (mixed-fleet) MPS deployments.

For OEMs, Channel Partners, and Service Providers

Basic fleet management services, or MPS engagements that focus only on assessment services
and reducing consumables, are at risk of becoming commoditized. The opportunities to continue
to grow market share by simply “grabbing” devices and converting them to a different brand are
diminishing. Meanwhile, the ability to differentiate services is limited. As revenue from click-charge
(or CPC) contracts continues to erode, the opportunity to replace that source of income lies in value-
added services through document workflow optimization and process improvement.

Nuance software enables MPS providers to go beyond cost savings to help customers turn printing
resources into a source of productivity improvement—a strategic business asset. Instead of lamenting
the need for print, Nuance partners can help customers identify where and when printing is the most
viable alternative business solution. As a result, providers can strengthen their customer relationships
to become indispensable partners. Driving value and profits for their customer translates to repeatable,
long-term business that is not easily replaced by competitors.

Even if customers prefer a traditional lease-based arrangement, Nuance partners can still deliver many
of the benefits of MPS by selling hardware with embedded Nuance software. Additionally, Nuance is a
single software provider that can manage all print-related devices through a common interface, which

1
Gartner, “Document Management: Assessing Costs Benefits,” 2000.
2
IDC Insights, “An Easy and Often Missed Opportunity for CIOs – MPS,” Angele Boyd, April 3, 2012.



helps to simplify the MPS solutions for MFP customers. Lastly, Nuance is a global company with a
global footprint, which means that service providers can more easily offer ongoing support for global
MPS engagements.

Summary
With managed print services expanding beyond large organizations into small- and medium-size
businesses, it has become increasingly important to drive value in MPS by focusing beyond cost
savings. MPS providers must understand that driving down CPP rates by reducing hardware and
lowering print volumes is only a short-term benefit to a long-term problem. Businesses are faced with
many challenges today: the increasing costs of doing business, security and compliance concerns,
doing more work with fewer people, and the transition to mobility and mobile document workflows,
just to name a few.

The MPS model provides a unique opportunity for businesses and service providers alike. The best
approach is to leverage the MPS relationship to first optimize the one element that sits at the heart of
all the transitional challenges: document workflow. Today, most MPS engagements are driven by the
desire to reduce costs. Any ongoing optimization of the fleet or further business process improvement
is almost an afterthought.

Nuance believes that the most effective MPS engagements begin with creating an optimized approach
to document workflow. This helps simplify the process of “right sizing” the printing fleet, drives worker
productivity, and leads to a more effective and efficient overall document strategy. As the business
world continues to move to mobile technologies, this becomes even more important. MPS providers
should focus on ways to bridge the gap between the paper and digital worlds. As owners of the
printed document, our industry should be leading the charge in the transition from paper to digital and
from paper-based workflow to mobile workflow.

All of these issues require a partner with long-term experience and expertise in business process,
document management and tracking, print management, and document workflow. Nuance is already
the leading software provider in the MPS space, with both embedded and standalone solutions
focused in each of these areas. As a result, Nuance is in the best position to help MPS providers take
the next step in managed print services and to meet the real requirements of today’s MPS customer.


W H I T E PA P E R

Copyright © 2013 Nuance Communications, Inc. All rights reserved. Nuance, the Nuance logo,
eCopy, PaperPort, and ShareScan are trademarks of Nuance Communications, Inc. or its affiliates
in the United States and/or other countries. All other brand and product names are trademarks or
registered trademarks of their respective companies.

Managing Print as a Strategic Asset

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