Xerox: Your Proven Managed Print Services Partner

Delivering Customer Value Through a Strategic Approach

Gartner Note: Magic Quadrant for Managed Print Services, Worldwide

InterContinental Hotels Group: Outsourcing Print Services to Improve Frontline Service

British Telecom: Maximizing Cost Savings by Focusing on Service Quality

Procter & Gamble: Treating Printing Worldwide as a Single Resource

Managed Print Services from Xerox

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Delivering Customer Value Through a Strategic Approach

Xerox: Your Proven Managed Print Services Partner is published by Xerox. Editorial supplied by Xerox is independent of Gartner analysis. All Gartner research is © 2011 by Gartner, Inc. All rights reserved. All Gartner materials are used with Gartner’s permission. The use or publication of Gartner research does not indicate Gartner’s endorsement of Xerox’s products and/or strategies. Reproduction or distribution of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The opinions expressed herein are subject to change without notice. Although Gartner research may include a discussion of related legal issues, Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner is a public company, and its shareholders may include firms and funds that have financial interests in entities covered in Gartner research. Gartner’s Board of Directors may include senior managers of these firms or funds. Gartner research is produced independently by its research organization without input or influence from these firms, funds or their managers. For further information on the independence and integrity of Gartner research, see “Guiding Principles on Independence and Objectivity” on its website, http://www.gartner.com/technology/about/ombudsman/omb_guide2.jsp.

Xerox Corporation45 Glover Avenue P.O. Box 4505 Norwalk, CT 06856-4505 United Stateswww.xerox.com

Xerox: Your Proven Managed Print Services Partner

1Gartner, Inc. “Magic Quadrant for Managed Print Services, Worldwide” By Ken Weilerstein, Cecile Drew, Yulan Li, September 22, 2010

“Before we brought in Xerox, we didn’t have a clear picture of what our true print costs were. The utility model we implemented with help from Xerox has really enabled us to get more control over our document management resources and spending.”

Angie Masini-Sloan Vice President & Director, Enterprise Technology Client Services KeyCorp

Managed Print Services and the Journey to Transforming Enterprise Print

By Stephen Cronin

President, Global Document Outsourcing

Xerox

“Although most organizations could, in principle,

manage their own office print actively and

effectively, in reality, many lack the time, the staff,

the experience, the tools and the focus, and they

simply will not do it on their own.”1

Many organizations look to MPS providers to help. How do you know which

MPS provider is right for you? Read the Gartner Magic Quadrant report as

a useful starting point for identifying and evaluating managed print services

(MPS) providers.

Xerox is proud to be positioned as a leader in the Gartner Magic Quadrant

for Managed Print Services, Worldwide. Xerox has been in the MPS

business for more than a decade and we continue to invest significant

resources to shape its future. Our Enterprise Print Services expand the four

walls of the corporate office to include remote and home workers, as well as

reprographics and centralized print. We successfully provide MPS worldwide

to large multiregional and global customers, as well as to smaller local

ones; and we serve a wide range of industries. We believe our unparalleled

breadth of coverage and the scalability of our offerings allow us to meet the

needs of our small, medium, large and global clients worldwide.

MPS providers take different approaches to managed print services. The

Gartner Magic Quadrant report explains these approaches:

• “The low road – MPS providers snap up as many customers as they can

by reducing their MPS proposals to the absolute lowest cost per page in

return for a stripped-down and simple hardware and service bundle…” 1

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• “The high road – MPS providers invest enough in needs

assessments to demonstrate the savings and other benefits

of MPS to the eager advocates in IT or the Purchasing

Department, as well as to their skeptical colleagues in, for

example, the Claims Department or Finance Department...”1

“All the MPS providers in the Gartner Magic Quadrant mix the

high- and low-road approaches, but the proportions vary by

vendor and, most importantly, by customer. The degree to which

each vendor followed the high-road versus low-road approach (or,

the degree to which each vendor emphasized price over value)

helps explain its position on the Magic Quadrant, as well as the

changes to the vendors’ positions.”1

So where does Xerox stand?

A Strategic Approach

We believe firmly that a strategic “high-road” approach will save

you more and deliver a host of other benefits such as improved

productivity, security and environmental sustainability. To achieve

these benefits, you need an approach aimed at managing all

of your print services as a single enterprise-wide resource.

It requires a willingness to break down geographical, line-of-

business and print-service purchasing silos. It calls for a focus on

processes as much as on hardware and technology.

We begin with a metrics-based, Lean Six Sigma approach:

our Xerox MPS engagement starts with an assessment that

establishes an accurate Total Cost of Ownership baseline

from which to target and measure improvements. As a trusted

advisor, we listen to customer needs and work collaboratively to

drive value to your business. This proven, fact-based approach

underpins our ability to make smart decisions and deliver ongoing

cost savings over the life of your contract, as well as meet other

objectives such as reducing your environmental footprint.

We know that few organizations can break down every silo

at once, and all organizations have tactical priorities. A good

example is the InterContinental Hotels Group (IHG) case study

that follows the Gartner Magic Quadrant report. IHG created a

single service across office print and central reprographics, but

did so first in one priority corporate location before looking to roll

out the model to its hotels and other facilities.

Every organization’s approach to achieving their objectives

will be different; the only thing we discourage is not having a

strategic vision at all. As the British Telecom (BT) case study

shows, it’s possible to have a very urgent focus on cost-control

without losing sight of the bigger picture.

At Xerox we specialize in a strategic approach that builds over

time towards an enterprise-wide service that delivers value at

every stage. Following this approach – through our MPS offering

called Enterprise Print Services (EPS) – we frequently help our

clients save up to 20-30% of their print spend. Procter & Gamble,

our third case study, has, in the first year of implementation

alone, reduced its operating costs by 21% after implementing a

worldwide EPS contract across its office and printroom services.

Nevertheless there will be organizations that simply don’t see

print as a strategic issue. Xerox provides a full continuum of MPS

services to simplify your office print infrastructures and realize

cost savings.

Delivering What We Promise

With our deep-rooted expertise, we have a proven ability to

deliver sustainable cost savings over the life of a contract. Xerox

has been positioned as a Leader in the Gartner Magic Quadrant

based on evaluation of Ability to Execute and Completeness of

Vision. We are delivering results today and are well prepared to

deliver results in the future.

One More Reason to Trust Us

More than half of the devices we manage for clients are not Xerox

products. We’re not in the business of selling you something you

don’t need; we really want to be your trusted advisor. We led the

way to shape and define MPS – and we will continue that tradition.

We strive to be in the forefront of innovation – differentiating us

in a marketplace that is moving towards commoditization. Last

year alone, we received hundreds of awards for our services and

innovation. We continue to look for ways to deliver more value to

our customers, creating an environment where it is fun to explore

ideas, incubate concepts and partner with our customers in

developing high-impact services.

We’re looking forward to hearing from you. If you’d like to find out

more, just give us a call. m

Stephen Cronin

President, Global Document Outsourcing

Xerox

“We’re in good shape. Everything works, availability is at an all-time high and everything is taken care of for us. What’s more, we have a clear understanding of exactly what we’re spending and saving, and where.”

Nigel Smith IT Sourcing Manager Reuters

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Magic Quadrant for Managed Print Services, Worldwide

Managed print services are a cost-effective alternative to the traditional purchase and leasing arrangements under which organizations acquire their office printers and multifunctional devices. Buyers must understand who sells MPS and how the services compare with one another.

WHAT YOU NEED TO KNOW

Gartner’s managed print services Magic Quadrant is a useful starting point for identifying and evaluating managed print services (MPS) providers. It is intended for Gartner’s client base of mainly midsize and large organizations, many of which operate throughout two or more regions, and some of which are truly global. Although not all MPS projects are multiregional or global at the outset, customers often choose to scale up one region at a time. In this way, they can manage their office printing in a unified manner globally. The providers in this Magic Quadrant have the geographical scale to attend to your office printing needs across world regions in a coordinated way.

Numerous other MPS providers approach their MPS projects locally or country by country and region by region and cater to like-minded customers, but they do not appear in this Magic Quadrant. Why not? As organizations progress from the prevailing loosely managed approach to an efficient and closely managed one, it makes sense to manage the entire fleet in a unified way, rather than with today’s characteristically fragmented approach. Naturally, some MPS customers are organized in a way that makes a unified fleet impossible or are confined to one country or region.

Your vendor selection should be based on a detailed evaluation of your office printing needs and goals compared with a service provider’s capacity to fulfill those requirements and expectations. Just because a service provider falls into the Leaders quadrant doesn’t automatically make it the right choice for you. All selections are buyer-specific, so vendors in the Challengers, Visionaries or Niche Players quadrants may sometimes be a better match for your requirements. For example, service providers in the

Challengers quadrant are capable of delivering the services required by most enterprises and may have a long MPS track record. Customers who are unready to go beyond the local or national level, or whose interest in MPS is limited to reducing their printer and MFP fleet costs, may find Challengers more than adequate. By the time they’re ready to go global in dozens of countries or take on a document-content-centric project for their main business unit project, the Challengers may be prepared to deliver it. Those in the Visionaries quadrant match both the range of needs and the geographical scope of many midsize and large organizations. For smaller organizations or large ones situated mostly in a single locale, vendors in the Niche Players quadrant may be the most attentive and most-

Research from Gartner RAS Core Research Note G00206095,

Ken Weilerstein, Cecile Drew, Yulan Li, 22 September 2010

Source: Gartner (September 2010)

figure 1. Magic Quadrant for Managed Print Services, Worldwide

challengers leaders

niche players visionaries

completeness of vision

ability to execute

As of September 2010

Xerox

Ricoh HP

LexmarkPitney Bowes

Canon

ToshibaOce

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cost-effective match. All the vendors ranked in this Magic Quadrant are large, established companies, so buyers should not assume that the Niche Players are likely to drop out of the market in the near future.

MAGIC QUADRANTMarket Overview

The Big Picture: The 2010 Commoditization Challenge

The prolonged economic slump that began in 2008 presented all MPS providers with conflicting opportunities and challenges. How they responded says a lot about your likely experience as a customer and about the future prospects for each provider.

• Theopportunitywasthat,thankstothedownturn,newcustomers of all kinds decided to reduce their office printing spending by 10% to 30% and adopted MPS to make that happen.

• Thechallengewasthatmanyofthosecustomersbroughtwith them all the doubts that prevented them from adopting MPS in the past: doubts about whether their organization was really prepared to make changes, about whether “soft” costs that do not show up on the books are in scope, and even about their willingness to accept outside help and guidance about their printer fleet, let alone about optimizing their business processes. Conversations with MPS decision makers in midsize and large organizations suggest that customers’ urgent need to cut costs outweighed their doubts but did not remove them.

MPS providers have always grappled with customer concerns, and most of them respond with a mix of easily recognized printer-fleet benefits (e.g., hard-cost savings, conservation and perhaps labor savings) and document-process improvements that might yield “soft” benefits, such as speeding up core business processes or boosting customer satisfaction. MPS providers typically strike a balance by, for example, deploying a reduced number of cost-effective MFPs in your fleet but also bundling into the cost per page pull-printing functions that help you both secure your documents and reduce your print volumes by double digits, or by bundling in walk-up scanning solutions that automate your paper-intensive enrollment process, perhaps, for example, shortening the customer line in front of the bank manager’s office on a Friday afternoon.

The first problem for MPS providers in 2010 is that some cost-driven customers now apply commodity-style sourcing methods to pick apart the various elements of these bundles, focusing

on discrete components, such as software license costs. The customers zero in on the cost per page but often discount the value of the help they will need to customize the solution to their own business, or the value of the consulting help they will need to configure the solution, or the value of the integration and support they will need to make it all work. Some customers have also piled on service-level agreements (SLAs) that demand, for example, higher printer uptime levels than they ever imposed on their own IT organization, or shorter repair response times than they really need.

The second problem is how the MPS providers respond:

• Thelowroad–MPSproviderssnapupasmanycustomersas they can by reducing their MPS proposals to the absolute lowest cost per page in return for a stripped-down and simple hardware and service bundle. The pull-printing option,forexample,mightstillappear–butasanoptionalmonthlycharge–callingattentiontothecostbutplayingdown the fact that this option could pay for itself by cutting their page volumes by 10%. We know vendors are on the low road when customers show us proposals titled “Managed Print Services,” with an optional monthly service fee for managing the printer fleet. Rather than take the time to help customers understand and make a persuasive case for MPS, some providers have simply redefined their services in a way that minimizes the risk of losing the deal to cutthroat competition, but undercuts most of the benefits of MPS. What is more, some contracts also contain hidden costs that will be paid at the end of the term or in the event of even a small reduction in page volume, and these could diminish the savings. Although watering down MPS may save a deal from cost-driven competitors, the consequences, such as the outages that some customers have reported due to razor-thin inventories of supplies, may sour them on upgrading to a better version of MPS later.

• Thehighroad–MPSprovidersinvestenoughinneedsassessments to demonstrate the savings and other benefits of MPS to the eager advocates in IT or the Purchasing Department, as well as to their skeptical colleagues in, for example, the Claims Department or Finance Department. Depending on their appetite for change, customers may adopt some of the solutions now, some later, and perhaps forgo others. Those customers who simply want to negotiate a traditional lease/service agreement can still negotiate this withthecommodityapproach–butnotunderMPS.

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All the MPS providers in our Magic Quadrant mix the high- and low-road approaches, but the proportions vary by vendor and, most importantly, by customer. The degree to which each vendor followed the high-road versus low-road approach (or, the degree to which each vendor emphasized price over value) helps explain its position on the Magic Quadrant, as well as the changes to the vendors’ positions.

History/Market Development

The following is a timeline of the development of the MPS market.

Pre-2000

• The“utilityprinting”conceptcomesinresponsetotheincreasingly diverse range of other IT infrastructure services and business process services being offered at this time. The idea is to bring the benefits of outsourcing to office printing, so customers seek to outsource the entire office printing function.

• OnlyafewvendorsofferMPSatthistime,andthecustomersare a subset of large corporations in North America and Western Europe that are open to experimentation.

2001 Through 2005

• Costsavingsopportunitiesdrawlargenumbersoforganizations to actively and closely manage office printing.

• Thefocusshiftsfromoutsourcingtoprintoptimization,as MPS becomes the means for a growing number of organizations to identify and assess, and ultimately reduce, their visible and hidden costs, including consumables, support and maintenance.

• Mostprovidersaskcustomerstosignathird-partyleaseinstead of the pure utility model and then combine this with the costs of service and consumables in a per-page charge that typically includes a minimum monthly page quota.

2006 Through 2010

• AwidervarietyofMPSpackagesisintroducedforsmallandmidsize businesses (SMBs) either directly from the provider or through its channel partner.

• MPSbecomesastandardpartofvendors’strategiestoselloffice printing to midsize and large organizations, resulting in increasing numbers of customers. To help win over cautious customers, all the major MPS providers agree to roll a portion of the customer’s existing equipment into its MPS contract.

• Full-cycleresultsofearlyMPScustomersarenowvisible,andmore customers are in the market for the second time around.

• Newrefinementsaroundneedsassessmentandusagetracking, user surveys, user education, and help in meeting environmental goals become mainstream MPS practices.

More About Trends That Emerged Between 2006 and 2010

• Customerbehaviorsbegantobeshapedbytheglobaleconomicslowdown–WesawacceleratedinterestinMPS, as organizations sought longer-term cost savings while bringing their print environments up to date and managing them over time. MPS helped them manage the life cycle of printing equipment, through better analysis and monitoring of their printing fleets, and make the best useoftheirexistingprintinfrastructure.Oncetreatedasaspecial request for certain large customers, MPS sometimes became a tactic for salespeople to approach and engage new customers. For the first time, MPS became available from almost every printer and multifunction product (MFP) vendor and from most dealers (even if only locally). It increasingly was packaged for SMBs.

• Focusoncostsavingsandquickerreturnoninvestment–Cost savings is the most common driver behind the decision to go with MPS because it enables customers to reduce their printing and copying spending through product consolidation or redeployment. It gives them a consolidated contract for hardware, supplies and maintenance for greater visibility of spending. MPS also provides the flexibility to scale pages, print resources and cost to match business volume and staffing. It has the ability to shift costs to where customers have available budget via chargeback and by turning capital expenditure into operating expenditure or vice versa. However, when evaluating projected savings, buyers also need to look at “softer” costs, such as how much they spend on replacing supplies, on services, on maintenance and on help desk, as well as the negative impact that an unmanaged printer/copier fleet can haveonemployeeproductivity.Organizationsmustensuretheycommunicate that they want to maximize both short-term and long-term savings, as well as work processes and other benefits.

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• Variedanddilutedapproaches–Despitetheadvancesinvendors’ ability to successfully deliver MPS, some customers are not getting as much guidance and help as they need. This dilution of the MPS concept is partly the result of salespeople trying to sell MPS to customers who are not ready to entrust the management of their fleet to vendors. It is also the result of competition between vendors eating away at the vendors’ profit margins to the point in which they focus on what is most profitable to sell, rather than what the customer really needs.

History of the Managed Print Services Magic Quadrant

In September 2008, Gartner published its first managed print services Magic Quadrant. As Gartner’s 2008 Visionaries and Niche Players strove to catch up with the Leaders, their markedly improved execution resulted in them moving up into the Challengers quadrant in our 2009 managed print services Magic Quadrant. The deep economic recession encouraged businesses to scrutinize their office printing. The 2009 Challengers and Leaders faced demanding customers, and their execution against commitment fluctuated. In 2010, MPS providers are caught between promoting and providing the long-term savings and business-process benefits that MPS should bring and the reduced appetite for (potentially disruptive) change, as well as the increased appetite for quick, simple savings as the customer base widens.

Implications for CustomersDon’t Ignore Business Processes

Many MPS engagements focus on equipment, supplies and service, ignoring such goals as paper-based business process improvement and the alignment of the print strategy to other areas of IT. Buyers should seek to benefit from their MPS providers’ industry-specific expertise to incorporate their documents in electronic processes. By seeking to enlarge the scope of their MPS this way, organizations can maximize cost savings and process improvements. It is therefore important for organizations to ask their potential MPS provider to demonstrate solutions for specific vertical industries and applications.

Involve the Stakeholders

To manage their office printing more actively, customers need toinvolvemorepartsoftheirorganization–notjustFacilitiesManagement or IT, but also the line of business and Purchasing (also known as strategic sourcing or procurement). The change is greatest for organizations accustomed to letting IT specify what is needed and then handing it off neatly to a Purchasing Department to get the best deal. Coordination is important,

because MPS deals and the accompanying terms and conditions are much more complex than the customary purchase of hardware, and good results demand multidepartmental cooperation throughout the process.

Expect Longer Purchase Cycles

MPS requires more planning than traditional printer and copier purchasing, so both buyers and sellers must readjust their time frames. Letting more people have a say in selecting a more complex package can easily double the three-month purchase cycles to six months and the six-month cycles to a year. The reward for the added complexity, however, is a 10% to 30% cost reduction instead of the roughly 5% possible under traditional purchasing practices. Buyers who skip the assessment and analysis upfront shouldn’t be surprised if they end up saving less than they hoped for, or perhaps even worse, living with the wrong choice of provider or the wrong services and equipment for the next few years. Note that much of the value that MPS provides is determined in the assessment phase that begins before the equipment is delivered, so prospective buyers should use their leverage to demand it be done carefully. Because the assessment often begins before the contract is awarded, customers should strive to use the clout they have at this point in the deal and not sign off until they have a solid case for MPS and understand what the vendor will deliver and how.

Exploit the True Value Proposition

Although most organizations could, in principle, manage their own office print actively and effectively, in reality, many lack the time, the staff, the experience, the tools and the focus, and they simplywillnotdoitontheirown.Organizationsthatmanagetheir printer, copier and fax fleets can save between 10% and 30% of their print costs. This is something organizations can do on their own if they know exactly how to proceed and have the resourcestodoso.Ifnot–asisoftenthecase–thenanMPSprovider can help. MPS promises to help organizations carry out the needed changes and save them money by providing the staffing and expertise to determine their true needs, optimize the fleet to meet them, and track and monitor them to keep the optimal state in place afterward. MPS also allows customers to bring their best sourcing efforts to bear on what becomes a single, comprehensive multimillion-dollar deal that usually lasts at least three years. The deal may go beyond the printer, copier and MFP fleet to include better handling of documents with direct business benefits. The deal may also encompass centralized reprographics departments (CRDs, also known as copy rooms) and even mailrooms.

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Market Definition/Description

“Managed print services” is a Gartner generic term for a service offered by an external provider to optimize or manage a company’s document output to certain objectives, such as driving down costs, improving efficiency and productivity, and reducing the IT support workload. Under MPS, a service provider takes primary responsibility for meeting the customer’s office printing needs, including the printing equipment, the supplies, the service and the overall management of the printer fleet. The main components provided are needs assessment, selective or general replacement of hardware (optimization), and the service, parts and supplies needed to operate the new and/or existing hardware. The provider also tracks how the printer fleet is being used, the problems, and the user satisfaction. The MPS provider analyzes the information gathered in the course of tracking and makes (or recommends to the customer) the adjustments needed to ensure fleet efficiency and to meet changing user needs.

Who Uses MPS?

MPS is mostly adopted by organizations with more than 500 users, across all industries and in all world regions. Although MPS can benefit all but the smallest organizations, it is midsize and large ones that ask Gartner about it the most. Large organizations, in particular, tend to have the most complex and least efficient office printing practices to begin with, and thus stand to benefit the most from optimizing them. These large organizations and many midsize ones, as well, typically have offices in multiple locations and world regions. Some seek MPS in all of their offices from Day 1, but most choose to start small and then add sites, divisions, countries and regions over time. For that reason, our Magic Quadrant is limited to providers that can serve as a single source for at least two world regions.

What Other Services Might Be Included in MPS?

MPS may also be expanded to include staffed services, such as CRDs (copy centers) as well as telecommuters. It may also include enterprise content management services and workflow optimization components, such as developing custom applications for smart MFPs that automate paper-intensive document workflows and route scanned pages to document management systems. It can also be extended to include the restructuring of document workflows.

How Do Customers Pay for MPS?

MPS does involve a consolidation of spending, but the actual payment schemes vary. Generally, the external service provider either owns the hardware or (more typically) leases it from a financing company in its customer’s name. The customer usually pays a per-page charge, which covers the cost of the equipment, any leasing

costs, the supplies, the parts, the service and other MPS elements. Some contracts stipulate a minimum number of pages per device permonth,withunusedpagesforfeited.Othersinvolvesomevariation on the monthly minimum, such as a sliding cost per page that decreases as the number of pages increases. Services are usually folded into the click charge, although in some cases, they are billed on a flat monthly or quarterly basis. Contracts that impose no minimum number of pages appear risk-free but typically obtain some other financial commitment on the part of the customer, such as a flat fee, a per-device fee or a per-seat fee. Some MPS contracts include guarantees of a certain result, but this hinges on agreeing to do things the vendor’s way.

Inclusion and Exclusion CriteriaInclusion Criteria

Onlyvendorsthatmeetallthefollowingcriteriaareincluded:

• Isabletoprovidetheequipment(vialeaseorasaprocurement service)

• Providesthesupplies

• Performsthebreak/fixandpreventivemaintenance

• Providesthetechnicalsupport

• ProvidesMPSintwoormoreworldregionstoatleastonecustomer. The customer must be verifiable and have at least 500 MPS users. The regions are North America; Europe, the Middle East and Africa (EMEA); Asia/Pacific (including Japan); and Latin America.

• Providesthelong-termtrackingandmanagementoftheprinter/MFP fleet

• Performstheinitialassessment(s)

• Buysbackordisposesofexistingequipmentthatisbeingreplaced, if this is required

• Billsonaper-pageorper-seatbasis

Exclusion Criteria

The inclusion criteria exclude print-related services that fall short of MPS. These include traditional, narrowly drawn copier contracts, certain retail printer service packages, and most infrastructure outsourcing contracts. Some genuine MPS providers also did not qualify because they do not serve multiregional customers in a unified way.

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Added

KonicaMinoltaandOcehaveprovidedMPSinpastyears,butwe added them to the Magic Quadrant in 2010 because they met all of our inclusion criteria for the first time in 2010.

Dropped

No vendors were dropped from the Magic Quadrant in 2010.

Evaluation CriteriaAbility to Execute

The Ability to Execute axis positions each MPS provider based on its success in delivering results today as well as its preparationtodeliverresultsinthefuture.Onthisaxis,Gartnerverifies an MPS provider’s capability to deliver MPS based on direct feedback from extensive interviews with its clients and other provided customer references.

Gartner analysts evaluate MPS providers on the quality and efficacy of the processes, systems, methods or procedures that enable their performance to be competitive, efficient and effective, and to positively affect revenue, retention and reputation. Ultimately, MPS providers are judged on their capability and success in capitalizing on their vision.

Each criterion is weighted high, standard or low in importance and scored accordingly. Table 1 shows the criteria for evaluating providers’ ability to execute.

Product/Service: This criterion addresses core goods and services offered by the MPS provider that compete in and serve the defined market. This includes current product and service capabilities, quality, feature sets and skills. We probed how well the provider ensures that the customer ends up with the right mix of equipment and help throughout the MPS engagement.

OverallViability(BusinessUnit,Financial,StrategyandOrganization):Viabilityincludesanassessmentoftheoverallorganization’s financial health, the financial and practical success of the business unit, and the business unit’s likelihood of continuing to invest in the service solution. We drew on all available sources to gauge how solidly grounded the MPS providers are today and how safe a bet they are for the future.

Sales Execution/Pricing: This criterion examines each MPS provider’s capabilities in all presales activities and the structure that supports them. This includes deal management, pricing and negotiation, presales support, and the overall effectiveness of the

sales channel. MPS agreements can lock in customers for years and can do more harm than good if the terms, conditions and pricing are drawn up wrong. We examine how well the vendor ensures that the customer gets a fair deal that is appropriate for the customer’s needs.

Market Responsiveness and Track Record: This criterion looks at the MPS providers’ ability to respond, change direction, be flexible and achieve competitive success as opportunities develop, competitors act, customer needs evolve, and market dynamics change. This criterion also considers the provider’s history of responsiveness. Successful MPS engagements cater to specific needs of the customer at hand. We looked closely at how far the vendor goes to ensure the success of the specific customer.

Marketing Execution: This criterion refers to the clarity, quality, creativity and efficacy of programs designed to deliver the organization’s message in order to influence the market, promote the brand and business, increase awareness of the MPS offering, and establish a positive identification with the service/brand and organization in the minds of buyers. This mind share can be driven by a combination of publicity, promotional activities, thought leadership, word of mouth, and sales activities. Effective marketing is important, because customers struggle to understand exactly what each vendor will do for them and how this differs from one provider to another. We look from all angles at how well the vendor communicates this, and how easy it is for customers to obtain this information.

Customer Experience: This criterion evaluates the relationships, products and services/programs that enable clients to be successful with the MPS evaluated. Specifically, this includes the ways customers receive technical support or account support. This can also include ancillary tools, customer support programs (and the quality thereof), availability of user groups, and SLAs. Successful MPS turns on the provider’s relationship with the customer in ways that SLAs and contract clauses can never entirely anticipate and enforce. We look from numerous angles at how well the provider ensures it maintains a good all-around relationship with the customer.

Operations:ThiscriterionreviewstheMPSprovider’sabilitytomeet its goals and commitments. Factors include the quality of the organizational structure, including skills, experiences, programs, systems and other vehicles that enable the organization to operate effectively and efficiently on an ongoing basis.Officeprintingisoneofthosetechnologiesthataffect

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almost everyone, so even small disruptions matter. We look at how the vendor works hand in hand with the customer to minimize the disruption to the end users and key stakeholders in the customer organization.

Completeness of Vision

The Completeness of Vision axis reflects each MPS provider’s prospects for success by analyzing its view of the market, its service operating model, and its strategic plans for growth and service improvements. Gartner verifies an MPS provider’s vision based on presentations from the providers and direct feedback from extensive interviews with the MPS provider’s clients, as well as insight gained while answering Gartner client inquiries on that topic.

Each criterion is weighted high, standard or low in importance and is scored accordingly. Table 2 shows the criteria for evaluating providers’ completeness of vision.

Market Understanding: This criterion refers to the MPS provider’s ability to understand buyers’ needs and translate these needs into products and services. Vendors that show the highest degree of vision listen to and understand buyers’ wants and needs, and can shape or enhance those wants with their added vision. We look at key areas in which the provider can prepare the customer for tomorrow’s priorities as well as today’s.

Marketing Strategy: This criterion evaluates the MPS provider’s strategy and approach to marketing and promoting MPS. We looked for a clear, differentiated set of messages consistently communicated throughout the organization and externalized through the website, advertising, customer programs and positioning statements.

Evaluation Criteria Weighting

Product/Service high

OverallViability(BusinessUnit, Financial, Strategy, Organization)

standard

Sales Execution/Pricing high

Market Responsiveness and Track Record

high

Marketing Execution high

Customer Experience high

Operations high

Source: Gartner

Table 1. Ability to Execute Evaluation Criteria

Sales Strategy: This criterion reviews the provider’s sales strategy and its capability to sell MPS. It includes the strategy for selling MPS that uses the appropriate network of direct and indirect sales, marketing, service, and communication affiliates that extend the scope and depth of market reach, skills, expertise, technologies, services and the customer base.

Offering(Product)Strategy:ThiscriterionaddressestheMPSprovider’s approach to MPS development and delivery that emphasizes differentiation, functionality, methodology and feature set as they map to current and future requirements. Across each of the main elements of MPS, we examined how the vendor maximizes the benefit of its MPS to customers.

Business Model: This criterion assesses the soundness and logic of an MPS provider’s underlying business proposition. A sustainable MPS business model must not only deliver savings and other benefits to customers, but also minimize the risks. We looked at how the vendor protects its customers against the risks inherent in MPS.

Vertical/Industry Strategy: The experience that MPS providers gain and investments that they make in vertical markets will help them build and retain their customer base in an increasingly competitive market. We assessed the MPS provider’s strategy to direct resources, skills and offerings to meet the specific needs of individual market segments, including verticals.

Innovation: This criterion includes direct, related, complementary and synergistic layouts of resources, expertise or capital for investment, consolidation, or defensive or pre-emptive purposes. As MPS matures, customers should expect continued improvements both in what vendors do for them and in how they do it. This depends on judicious investments. We look at the quantity and quality of the providers’ investments in MPS versus the value that they will likely provide to customers.

Geographic Strategy: This refers to the MPS provider’s strategy to direct resources, skills and offerings to meet the specific needs of geographies outside the “home” or native geography, either directly or through partners, channels and subsidiaries, as appropriate for that geography and market. Many of Gartner’s clients have offices scattered across an entire country or region, several continents or the entire world. We evaluated the ability of the providers to accommodate the range of customers’ geographies, from local through national, regional, multiregional and global.

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LeadersLeaders provide MPS to a wide range of customers, including the largest and most geographically dispersed, so they must demonstrate a truly global reach. They must demonstrate not only the skills to deliver today’s MPS, but also the understanding, initiative and resources to prepare for tomorrow’s MPS. Leaders characteristically augment the full scope of MPS with a wide range of added-value services. As a result, they are frequently shortlisted by large and midsize customers.

ChallengersAlthough Challengers have solidly demonstrated that they provide the core elements of MPS, they communicate a less complete view of the market direction than Leaders. The package of services they offer and the way it is marketed may also cater to a somewhat narrower range of company sizes and industries than that of Leaders. Even when the customers are the same as for the Leaders, the scope of engagement may be more narrow.

VisionariesVisionaries thoroughly understand today’s market and also know how to address customers’ future needs and expectations. In the aggregate, they provide a wide range of MPS to a diverse range of customers. What differentiates them from Leaders is their ability to successfully market and deliver all of their services to customers of different scale and across different regions in a well-unified way.

At the current level of market maturity, there are no Visionaries in this Magic Quadrant.

Evaluation Criteria Weighting

Market Understanding high

Marketing Strategy high

Sales Strategy high

Offering(Product)Strategy high

Business Model high

Vertical/Industry Strategy high

Innovation standard

Geographic Strategy high

Source: Gartner

Table 2. Completeness of Vision Evaluation Criteria Niche Players

Niche Players meet all of our inclusion criteria but provide a more-narrow range of services to a more-narrow range of customers than the other vendors. They may be a cost-effective choice for customers whose requirements, scale and geographical scope happen to be a good match. Some customers also report that the Niche Players pay them especially close attention and are generally more accommodating than large vendors.

Vendor Strengths and CautionsCanon

Strengths

• Yearafteryear,Canon’sMPScustomerspraisetheefficiencyandexpertise with which it installs and rolls out its equipment in their sites, and with which it delivers its MPS processes. It does a good job of assessing customer needs, designing a compelling future state, and helping move customers to that target state through tracking and customer education.

• SomecustomerstellusthatCanonhelpedthemcopewithunexpected developments that required flexibility, such as redesigning the floor plan or adjusting the minimum page volumes when their staffing or other factors changed.

• AsCanontakesonmoreMPScustomerswithmore-complex needs, it has added a special oversight function to proactively ensure that all SLAs are met, rather than wait for customers to notice.

Cautions

• CanonnowoffersMPSinmostworldlocations(bolsteredby a recent alliance with Fujitsu in Japan). Canon’s global strategy features standardized core services. However, as a customer, you may also find much variation in the levels of MPS experience and business momentum between the different world regions and countries.

• Ifyourprinterfleetextendsacrossdifferentcountriesandregions, research the differences in practices between the countries and locations where you may eventually roll out MPS.

• AskCanonforreferencesinyourindustry(andregion).Although we’re confident of Canon’s ability to understand and cater to specific verticals in a valuable way, we lack evidence of large-scale Canon MPS engagements in some of the industries to which Gartner’s clients belong.

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HP

Strengths

• HPhashiredstafftocarryoutitsvisionoftyingMPSwithbroader IT infrastructure and systems, services and solutions, by creating a worldwide MPS-focused business unit. The new Managed Enterprise Solutions unit can advance MPS within Enterprise Business engagements and on its own.

• HP’salliancewithCanonfinallyprovidesitthefullrangeofcopier-style (A3) MFPs it has always needed to complete its equipment lineup. However, inquire on what equipment, options and repair response times are available in the regions where you operate because these may vary.

• Whateveryourindustry,HPprobablyalreadyhascustomersin it and can refer you to them to tell you about their experience. Knowing that your MPS provider understands your industry is reassuring.

• HPhasinvestedinnewprocessesandsoftwaretostreamlinethe delivery of important aspects of MPS, such as needs assessments, new site rollouts, proactive remote and on-site services and supplies management, help desk integration, and tracking and reporting.

Cautions

• HPhasavarietyofpaymentschemesforMPSandwillallowyou to scale back the quantity of equipment or number of pages in your MPS deal in case your volumes decrease, at least up to a point. Ask about the different approaches and compare. But also makesureyounaildownandgetinwritinghowthiswillwork–some customers did not do their homework and were surprised to find themselves on the hook.

• JustbecauseHPcanprovideclearandtimelybillsdoesn’tmean it always does so, and some customers report this did not happen. Insist that HP explain to you how it will provide bills that are not only easy to understand but are amenable to your auditing practices.

• IfyourMPSproposalcountsonHPprovidingyouwithCanon equipment, ask for specifics about how Canon will carry out its responsibilities, such as delivering and installing the right equipment at the right time, and providing maintenance, parts and repair over time, because HP’s global and national-level commitments rely on local Canon offices and dealers for follow-through.

Konica Minolta

Strengths

• KonicaMinoltadoesagoodjobofclearlyandpersuasivelyexplaining the case for MPS, and this could help you, in turn, make a strong case to management and to the other stakeholders, such as line of business departments.

• KonicaMinoltadoesagoodjobofpatientlygatheringthe information needed to understand site-by-site needs, right down to interviewing users and managers. Some competitors rely too heavily on automated data gathering and gloss over this important step.

• KonicaMinoltacanservelargecustomers,andithassomecustomers with thousands of users. However, its direct operations are nicely scaled to midsize organizations (with 500 to 999 employees) that are large enough to justify MPS but worry they won’t get the full attention from other MPS providers.

Cautions

• Withtherespectablerangeofindustriesitserves,KonicaMinolta is in a good position to tailor its MPS to maximize the benefit to specific verticals, but it has not yet refined its MPSprogramtothatpoint–notethatthedegreetowhichthis applies varies by region.

• AlthoughKonicaMinoltahasMPScustomersinthedifferent world regions, and it now supports other vendors’ brands as well, most of its past MPS experience is limited to Konica Minolta equipment.

Lexmark

Strengths

• LexmarkhasalonghistoryofprovidingMPStoalargenumber of industries, especially finance, retail, healthcare, government, utilities and manufacturing.

• AlthoughmostMPSvendorstalkaboutoptimizingcustomers’ workflows, Lexmark actually understands what streamlining work processes involves. Its solution approach, which predated its MPS, involves listening closely to its customers, analyzing how they use documents in the business context, and proposing either off-the-shelf or custom solutions to help them.

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• AlthoughMPSprovidersdon’talwaysdeliveronwhatthey promise, Lexmark has won praise from customers for accurately and honestly stating what it will do for them.

Cautions

• IfyoufindLexmark’sunderstandingofyourindustryandits line-of-business specific solutions compelling, resist the temptation to limit the engagement to those departments and push Lexmark to extend its MPS across the organization.

• Lexmarkcontinuestoworkaroundgapsinitsproductlinefor A3 MFPs with speeds that exceed 50 pages per minute (ppm). Normally, the company proposes A4 alternatives, but it will find a way to accommodate you if you speak up.

Oce

Strengths

• OcehasinvestedeffortindocumentingitsMPSprocesses,suchas customer needs assessments and customer reports, in a clear, detailedway–somethingthatcompetitorsoftenoverlook.Thatdocumentation can make a big difference when you use the assessment results to win support from management and from line-of-business departments and other stakeholders.

• Oceiswell-equippedtointegrateyourprinterfleetwithyour CRD or copy room. It has years of experience operating customers’ CRDs and mailrooms in Europe and in North America, and under MPS, it can leverage its staff to provide hands-on service and supplies replenishment. These are tasks that, despite the best intentions of some competitors, can never be fully automated.

• OcehasanchoreditsMPSinindustry-standardprocessmethodologies, such as ITIL (IT services management) and Prince2 (structured project management). This may help you win the support of senior IT management for your MPS plans.

Cautions

• AskOceforsolidreferencesinyourindustry(andregion).Ocecaters to the needs of customers in different industries, but the number of clients it has served varies by industry and location.

• IfyourMPShasanycustomservicesorallowsexceptionsto the contract, make sure you get them in writing. Canon acquiredOcein2010,anditisallowingittooperateautonomously for now, but Canon may standardize its MPS across the two units in the future.

• CustomerslookforapredictableMPSrollout,butsomeOcecustomers report differing results in terms of getting the MPS fully up and running, depending on the capabilities of the individual running that particular account.

Pitney Bowes

Strengths

• PitneyBowessupportscustomerswithsmall,dispersedsitesin vast outlying parts of North America and beyond. At the same time, it also caters to centralized sites, where it can help you integrate your MPS with your document processes in mailrooms and copy centers, and it is well-positioned to tie your MPS into document-centric functions, such as records management.

• PitneyBowesisabletoprovidethehands-on,on-siteservicesthat some customers seek, and it does not try to impose on them a remotely supported approach that is convenient for the MPS supplier but not convenient for the customer.

• CustomersreportthatPitneyBoweshelpedthemmakeasmooth transition into MPS, rolling out the equipment and software, and paid good attention to such details as how help desk calls are handled.

• Somecustomersareuneasywiththewaymostvendorsuse MPS, at least partly as a distribution channel for their printers and supplies, because they fear that as a result, they will be sold more printing equipment or capacity than they really need. Pitney Bowes has less incentive to favor one brand over another than competitors because it does not manufacture printers or MFPs, and all the equipment it supports under MPS comes from other manufacturers, such as Canon, HP, Sharp and Xerox.

Cautions

• AlthoughPitneyBowesoffersMPSinNorthAmerica,LatinAmerica and Western Europe, we have seen few examples of its MPS outside of North America.

• ExpecttodosomeresearchtofullyunderstandPitneyBowes’MPS offering. You may get an incomplete picture from the company’s various websites, which provide only a high-level view in some countries and nothing at all in others.

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• GoodMPSoutcomesarebuiltongoodorganizationalalignment across departments, which your choice of MPS provider can enhance or deter. Although Pitney Bowes has an impressive customer list, it lacks the track record that some of its competitors have in aligning its MPS with its customers’ line-of-business departments and IT, because Pitney Bowes’ customer relationships often grew out of relationships with the mailroom or Facilities Management.

Ricoh

Strengths

• CustomerspraiseRicoh’sdiligentfollow-throughonitsMPS,starting with its thorough needs assessments and continuing through its well-managed rollout and delivery of services and supplies.

• RicohhastakenaneclecticapproachtoR&D,blendingmethodologies from the different world regions and from the various companies it has acquired, such as Lanier, NRG, IkonOfficeSolutionsandInfoPrintSolutions,aswellasfrom partners such as IBM.

• Ricohisbusyperfectingitschangemanagementservices,bolstering its own MPS experience with an infusion of external consulting. Change management helps customers overcome the internal constraints and resistance that MPS projects often face.

Cautions

• Ricohstaffdeliversmostofitsservicesdirectly,butinsomecountries and locations, it also relies on dealers. Before you sign, make sure you understand who will deliver your MPS, what elements the dealers will not be able to deliver, such as software, assessment or service levels, and ascertain how Ricoh will ensure their cooperation and what you’ll do about it in case they don’t. If you have any doubt about whether Ricoh will ensure consistency between regions, ask them how their expert “SWAT” team can help.

• SomecustomersreportbreakdownsincommunicationwithRicoh during rollout, resulting in equipment or staff not being in place as planned. Review your plans and check to ensure they’re on track.

• SomecustomersencounterinconsistenciesinRicoh’sfleetstatusand statistical reporting across different countries and locations. If you’re considering Ricoh on a multinational scale, scrutinize the consistency of Ricoh’s reporting across countries, especially if you are operating under different contracts.

Toshiba

Strengths

• Toshiba’seffortstoimproveandstandardizeitsprocesseshaveresulted in good customer care, including better user training and fewer billing problems than most MPS providers.

• Althoughfullycapableofservinglargecustomers,Toshibatruly caters to midsize ones and tends to lavish more attention on midsize customers than its larger competitors do. Its responsiveness and willingness to adapt its practices to customers’ needs has won it a growing base of loyal customers.

• AlthoughToshibahasitsownlineofMPSofferingsandprinters, it will also absorb equipment that you already own under its MPS.

Cautions

• Ifyouarealargeenterprise,makesureToshibaassignsproject managers and account managers with the appropriate background. Although Toshiba has large banks and other enterprises as customers, most of its customers are midsize organizations.

• CommentsfromToshiba’sMPScustomerspointtoaneedfor more consistent two-way communication as to what will happen. Review the detailed statement of work that Toshiba will provide you before signing off so you clearly understandhowtheservicewouldbeimplemented–fromrolling out software to the handoff of help desk calls.

• Toshibaisexpandingitsmultinationalreach,butitstillhas a scant track record with MPS in Europe and has less evidence of a move toward a global MPS than most of its competitors.

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Xerox

Strengths

• XeroxsuccessfullyprovidesMPSworldwidetolargemultiregional and global customers, as well as to smaller local ones. Its unparalleled reach is due to its entrenched operations in hundreds of countries worldwide, including those served in the Asia/Pacific region by its closely aligned partner, Fuji Xerox, of which it owns 25%.

• XeroxwasoneofthemaincompaniestoshapeanddefineMPS, and it continues to invest heavily in developing the processes and software to support and expand the range of services it provides.

• Xeroxisalmostunmatchedamongrivalsintherangeof industries it serves, and it will usually be able to find customer references in your industry.

• CustomersoftenreportthatXeroxdoesathoroughjobofassessing their needs and establishing a reliable baseline on which to build its recommendations.

Cautions

• AlthoughXeroxhasmadestridestowardstreamliningand simplifying its products and services, its MPS offering is one of the richest, and salespeople may overestimate or underestimate your appetite for business-process improvements or for industry-specific solutions. Ask about alternatives, rather than assuming a first proposal is the last word. For example, customers whose relationship with Xerox was limited to the Purchasing or Facilities Management Departments should treat the move to MPS as a chance to explore Xerox’s industry-specific solutions with its line-of-business departments.

• Probefordifferencesabouthowcontractorsorlocalpartnersdeliver on MPS in regions where Xerox relies on them instead of its own staff. Some multiregional MPS customers report deviations or limitations in terms of pricing options, contract language and assessment processes, potentially frustrating your effort to unify your office printing worldwide.

• Xeroxallowscustomerssomeflexibilityonmonthlyminimumvolumes in case their needs change, and it can also pool the customers’ pages across the fleet to balance out overages and underages. Some customers have complained recently, though, that the fine print of the contract negated the protections they thought they had. Your legal team may not be tuned into the nuances of MPS, so when the time comes to review a proposed contract, ask them to check this point.

Vendors Added or Dropped

We review and adjust our inclusion criteria for Magic Quadrants and MarketScopes as markets change. As a result of these adjustments, the mix of vendors in any Magic Quadrant or MarketScope may change over time. A vendor appearing in a Magic Quadrant or MarketScope one year and not the next does not necessarily indicate that we have changed our opinion of that vendor. This may be a reflection of a change in the market and, therefore, changed evaluation criteria, or a change of focus

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Evaluation Criteria DefinitionsAbility to ExecuteProduct/Service: Core goods and services offered by the vendor that compete in/serve the defined market. This includes current product/servicecapabilities,quality,featuresets,skillsandsoon,whetherofferednativelyorthroughOEMagreements/partnershipsas defined in the market definition and detailed in the subcriteria.

Overall Viability (Business Unit, Financial, Strategy, Organization): Viability includes an assessment of the overall organization’s financial health, the financial and practical success of the business unit, and the likelihood of the individual business unit continuing to invest in the product, continuing to offer the product and continuing to advance the state of the art within the organization’s portfolio of products.

Sales Execution/Pricing: The vendor’s capabilities in all pre-sales activities and the structure that supports them. This includes deal management, pricing and negotiation, pre-sales support and the overall effectiveness of the sales channel.

Market Responsiveness and Track Record: Ability to respond, change direction, be flexible and achieve competitive success as opportunities develop, competitors act, customer needs evolve and market dynamics change. This criterion also considers the vendor’s history of responsiveness.

Marketing Execution: The clarity, quality, creativity and efficacy of programs designed to deliver the organization’s message in order to influence the market, promote the brand and business, increase awareness of products, and establish a positive identification with the product/brand and organization in the minds of buyers. This “mind share” can be driven by a combination of publicity, promotional, thought leadership, word-of-mouth and sales activities.

Customer Experience: Relationships, products and services/programs that enable clients to be successful with the products evaluated. Specifically, this includes the ways customers receive technical support or account support. This can also include ancillary tools, customer support programs (and the quality thereof), availability of user groups, service-level agreements and so on.

Operations: The ability of the organization to meet its goals and commitments. Factors include the quality of the organizational structure, including skills, experiences, programs, systems and other means that enable the organization to operate effectively and efficiently on an ongoing basis.

Completeness of VisionMarket Understanding: Ability of the vendor to understand buyers’ wants and needs and to translate those into products and services. Vendors that show the highest degree of vision listen and understand buyers’ wants and needs, and can shape or enhance those with their added vision.

Marketing Strategy: A clear, differentiated set of messages consistently communicated throughout the organization and externalized through a Web site, advertising, customer programs and positioning statements.

Sales Strategy: The strategy for selling product that uses an appropriate network of direct and indirect sales, marketing, service and communication affiliates to extend the scope and depth of market reach, skills, expertise, technologies, services and the customer base.

Offering (Product) Strategy: The vendor’s approach to product development and delivery that emphasizes differentiation, functionality, methodology and feature set as they map to current and future requirements.

Business Model: The soundness and logic of the vendor’s underlying business proposition.

Vertical/Industry Strategy: The vendor’s strategy to direct resources, skills and offerings to meet the specific needs of individual market segments, including verticals.

Innovation: Direct, related, complementary and synergistic layouts of resources, expertise or capital for investment, consolidation, defensive or pre-emptive purposes.

Geographic Strategy: The vendor’s strategy to direct resources, skills and offerings to meet the specific needs of geographies outside the “home” or native geography, either directly or through partners, channels and subsidiaries as appropriate for that geography and market.

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InterContinental Hotels Group: Outsourcing Print Services to Improve Frontline Service

With more than 4,500 hotels in 100 countries and territories,

InterContinental Hotels Group (IHG) is a complex global

business. To maintain leadership in its industry and accelerate

growth, IHG looks for ways to sharpen its focus on looking after

guests by outsourcing non-core business processes and back-

office operations to experts.

Challenge

IHG wanted to transform its approach to document management

at its Atlanta headquarters, which oversees operations in North and

South America. While its priority was to reduce costs and improve

the efficiency and cost-effectiveness of Atlanta’s print-related

infrastructure, the objective was also to create a model for document

management services that could be replicated at other IHG facilities.

Solution

Using our Lean Six Sigma approach, we thoroughly assessed IHG’s

corporate office environment before implementing an optimization

plan. We migrated the infrastructure from a hard-to-manage, fixed-

cost capital asset to a utility managed service covering equipment,

output, supplies, maintenance and support. As part of the plan, we

replaced inefficient devices with more advanced and environmentally

friendly multifunctional devices (MFDs). To reduce the need for costly

outside printing, we worked with IHG to establish a state-of-the-art

in-house print production center.

Results

IHG now has a simplified pay-per-use pricing model for its printing

in Atlanta and has dramatically improved the quality and reliability of

the document services available to staff and guests. The in-house

print center has improved productivity, saved IHG over $1.5m a year

in external printing costs, and provided staff with an easier way to

produce professional documents and enhance the IHG brand.

Based on the outstanding results in Atlanta, IHG and Xerox have

begun to extend the optimization project to hotels and facilities

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Source: Xerox

“Xerox is ... making our back office so efficient ... that our managers and front-desk staff have more time to listen to our guests and make them feel comfortable. In our business, that’s what gives us the competitive edge.”

Paul Snyder Vice-President of Operations Portfolio (Americas) InterContinental Hotels Group

Before:

• In-house document management distracting from core

focus on guests

• Initial priority to address inefficiencies at corporate

headquarters

• High external print costs

Solution:

• Lean Six Sigma-based assessment of office

environment

• Optimization of infrastructure and replacement of

inefficient devices with state-of-the-art MFDs

• Utility pricing model for managed services

• Establishment of in-house print center

After:

• Improved quality and reliability of document services

for staff and guests

• Simplified pay-per-use pricing

• More than $1.5m saved per year on external printing

• International rollout

Xerox Enterprise Print Services in Action

In almost every industry across the world, organizations of

every size have turned to Xerox to help them manage their

print environments more effectively. As these three examples

show, we’re delivering on our promises to them and creating

both immediate and lasting benefits.

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British Telecom: Maximizing Cost Savings by Focusing on Service QualityIn the UK, where the majority of British Telecom’s 96,000 direct

employees are located, information flow is a complex affair between

more than 600 offices, exchanges, multi-building campuses and

other sites. Print is a major part of this flow of information, both

between colleagues and to customers and partners.

Challenge

Responding to new market pressures, British Telecom set itself

some aggressive targets to improve the quality of its services

while controlling costs and contributing to its green agenda.

With Xerox already responsible for British Telecom’s print and

reprographic services across the UK, the company looked to us to

help it meet these new challenges.

Solution

We worked closely with British Telecom to understand its priorities

and develop a service improvement program that is expected to

save £10.4m over four years.

The initial focus was on how to use the large fleet of office print,

scanning and copying devices at lower cost and with a smaller

carbon footprint, without sacrificing the quality and efficiency of

the services being delivered. A key element is the replacement of

end-of-life devices with ones that deliver a lower cost per copy, use

lower-cost consumables and are more energy–efficient. Another is

initiatives that encourage staff to reduce the amount they print.

Results

The office print service improvement program has improved

British Telecom’s user-to-printer ratio from 8:1 to 25:1, and its

print-related carbon footprint is assessed to be down by 50%.

Customer satisfaction ratings based on a regular survey of

British Telecom employees are exceeding target.

British Telecom recently renewed our contract for reprographic

services. As a trusted partner, we are working together to gain

even more efficiencies. We’ve committed to delivering targeted

savings of up to 40%, which will partly be achieved by rationalizing

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Source: Xerox

“We’re building on an already strong partnership to improve a critical enterprise function … As a result we’re looking forward to achieving some really tough targets.”

Alan Quearns Services Manager British Telecom

Before:

• Aggressive targets for improving service and cutting

costs across 600 sites

• User-to-printer ratio of 8:1

Solution:

• Service improvement program, starting with office print

• Replacement of end-of-life devices with more efficient

ones

• Initiatives to reduce the number of pages printed

After:

• £10.4m targeted savings over four years

• User-to-printer ratio of 25:1

• 50% reduction in carbon footprint

• User satisfaction ratings exceeding target

• Targeted savings of 40% in reprographics

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Procter & Gamble: Treating Printing Worldwide as a Single ResourceWith 135,000 employees in 80 countries, Procter & Gamble

(P&G) produces millions of documents annually. Not long ago

the company was supporting 45,000 copiers, printers, scanners

and fax machines to produce this output: not a very efficient use

of resources with the average machine being used only by some

four employees.

Challenge

The problem wasn’t just operational costs. P&G’s staff was

dissatisfied with the reliability of office services and the company

had a corporate directive to operate more sustainably.

P&G realized that a big part of the problem was that its 200 facilities

worldwide were free to purchase their own devices and supplies

independently. The company needed centralized control. It wanted to

manage its worldwide print fleet as if it were a single printer.

Solution

Xerox addressed the problem by first applying our Lean

Six Sigma assessment process to P&G’s document-driven

processes, going so far as to measure employee activities with a

stopwatch to gather accurate data.

We identified a new process to improve productivity, reduce

waste and generate savings. We rationalized the printer fleet

and developed a web portal for online learning, procurement and

support. We delivered a change management program to support

staff during the transition to our managed Enterprise Print Service.

Results

With 130 out of 200 sites migrated to the managed service, P&G’s

office print fleet was down to just 10,000 devices, with an average

of 14.3 employees per device.

Process improvements are saving the company 138 business

days annually. Beyond these productivity improvements the

company has realized substantial savings and sustainability

benefits: reducing operating costs by 21%, paper consumption

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“Simplifying our global printing structure helps increase reliability and efficiency, transforming the way we work.”

Filippo Passerini Chief Information Officer and President Global Business Services, Procter & Gamble

Before:

• No centralized control across 200 sites worldwide

• Wasteful printing: devices used by only four

employees

• Staff dissatisfaction with reliability of service

Solution:

• Worldwide managed print service

• Up-front assessment leading to new processes

• Device rationalization

After:

• User-to-device ratio now 14.3:1

• Printing costs reduced by 21%

• Paper consumption down by 30%

• Energy costs down by 30%

• 138 business days saved annually

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Managed Print Services from Xerox The facts to back it up

• 20+ years delivering document- and print-related services

• Thousands of MPS deployments globally

• 30+ years developing environmental technologies such as

duplex printing, n-up functionality and solid ink

• More than 500 locations with 90,000 front-line delivery

professionals working in our services group

• Network of global ITIL-aligned shared delivery centers

delivering 24/7 client support

• Experts in Lean Six Sigma methods to reduce costs, process

variability and waste

• More than 9,400 active patents – a testament to our ongoing

dedication to innovation

About Xerox Services.

Xerox Corporation is a world leader in business process, information technology and document outsourcing services. Our unique

combination of industry expertise and global delivery capabilities helps you reduce costs and streamline operational processes while

clearing the way for you to focus on what you do best: your real business.

To learn more about Xerox Managed Print Services, please contact your Xerox representative or visit us at www.xerox.com m

©2011 Xerox Corporation. All Rights Reserved. Xerox® and Xerox and Design® are trademarks of Xerox Corporation in the United States and/or other countries. 02/11

A trusted partner

Thousands of businesses in more than 150 countries

around the world rely on us every day to manage their print

environments. Our technologies, expertise and services enable

your business to operate more efficiently and effectively in the

office, whatever the situation.

With Xerox at the heart of your company, you’re ready to take on

the world of real business.