WhatTheyThink spoke with Xerox’s Gina Testa to gain a deeper understanding of the company’s new enterprise print services model. There have been a number of announcements over the last couple of years that have created a stir in the printing industry, with concerns about vendors competing with their customers. Testa was quick to say, “In no way does this communicate that we are going outside the enterprise and trying to bring commercial printing back in. It merely deals with the status quo of internal print, whether it is done at the desktop, on a multifunctional device or in the in-plant print ship, and hoping to make all of those areas more efficient. The cool part is connecting the virtual worker, who many be working on the road or at home, with the main enterprise. For the fist time, we are offering a direct connection from the worker to the in-plant so they don’t have to make a conscious decision about whether work should be produced in the workgroup or in the in-plant. It is up to the enterprise customer to make the rules and recommendations about which print should go where.”
Testa points out that Xerox already had a similar offering called Xerox Office Services, which EPS expands to improve the connection among all of the printing resources within the enterprise. She says, “We try to educate users and the software we use is intelligent enough that once specifications are laid out, if the user chooses a printer that is not the most cost effective, he or she will be pinged with a message that lets them know the location of a more cost effective printer for the job.” Test adds that in many cases, office worker behavior needs to be changed, primarily because the cost of office printing is often an area into which they have little visibility. “This should not have a negative impact on the graphic communications industry,” she says, “because this is work they are not doing today at all; it is being produced internally to the enterprise.”
WhatTheyThink also checked in with Standard Register, who has long had a similar offering and was one of the few that analyzed the costs across the enterprise, including outsourced print, to determine how it could be done more cost effectively. Standard Register is still offering those services, but has sold the related intellectual property to Pharos and is using Pharos as a partner to provide that infrastructure.
Other questions we had for Xerox included:
- Is this a multivendor solution, or does it require working with all Xerox print engines? Testa assured us that it is a multivendor solution and if the enterprise has non-Xerox printers, they are part of the infrastructure.
- Does EPS also take into account outsourced work, similar to the Standard Register offering? Testa reports that at this time, the services are focused entirely on the enterprise and that management of outsourced work might be an enhancement at some future time, although no definite plans are in place to do so.
- Will EPS be moved to ACS as part of the acquisition? There seems to be some crossover. Xerox responded to this question by indicating that there is still a great deal of work going on to finalize the ACS acquisition. They were unable to comment much more on what might be done in this area, saying, “Once the acquisition is complete, we will be able to provide a much clearer explanation.”
Testa indicates several large organizations have already signed up for the service, concluding, “We have been in this business for a very long time, and in fact, were probably one of the inventors of the concept. Enterprise Print Services is basically a new name for an existing service that has been significantly enhanced to connect the enterprise printing ecosystem from the desktop to the in-plant shop within the enterprise. It is not intended to have an adverse impact on the commercial printing industry, but rather, a very positive announcement for the printing world at large, and especially for enterprises struggling to contain these costs.”
Discussion
By Grover Daniels on Oct 29, 2009
Xerox, the name brings shivers to alot of print and copy companies.
Imagine this story.... A Xerox service technician goes to a small print and copy shop for normal repairs on a Xerox copier/digital printer. The technician sees pages and pages of copies for Company ABC. Next month ABC calls that local print and copy shop and asks why they are paying so much for copying. Next thing you know Xerox has 2 copiers in ABC mailroom. Years past, and ABC grows into a bigger company, and needs to outsource print and copying because they have out grown their older Xerox equipment. The same technician returns for noraml repairs at the local print and copy shop. Within a short period of time, Xerox Business Services puts a roomful of copiers in ABC and signs a 3-year iron-clad FM agreement; with minimum click charges and all sorts of cancellation penalties. Scratching their collective heads, the local print and copy company says, there MUST be something we can provide ABC that they can not do in-house, and sure enough the Xerox sales rep arrives with the newsest digital print machine the Igen. Well that's it, the print and copy owner says, we will provide full color postcards and flyers, with easy to use personalization to ABC. ABC loves the idea, and starts to use the local print and copy shop for more work, again. But alas, the Xerox FM starts losing clicks on it's in-house copiers, and scratches it's collective head to say how can we keep ABC away from that pesky local print and copy shop.
EPS, that's what's next.
Xerox, the sign of the double cross. Not to be trusted, ever.
By Laura Reynolds on Oct 29, 2009
As stated above, it is so true. Personally experienced this in our very small and remote region, no doubt. Us: little print and copy center without the big city name. Our client: Native American Casino and Resort. Lost over $80,000 first year of their conversion to brand XX. Client comes back wanting bindery only. We say "time to do it yourself now that you're an inplant printer with a machine equal to, or perhaps better than what XX contracted to us".
No Igen yet for either party. First they build up the small printer, convince you to lease more, heck, two are better than one, right? And then whammo, one client at a time who can afford the dotted line.
By Miichael J on Oct 30, 2009
Grover,
Great comment. I think you've got to heart of the matter as Xerox tries to balance selling "EPS" with supporting their PSPs.
I'm not holding my breath, but maybe this time they'll get it right. Hopefully they've been scared straight by the last couple of years.
What I'm seeing is that some of the globals seem to understand that the thing to do is to support proof of concepts and research and then put the work into their network of PSPs.
InfoPrint did a very serious proof of concept with Comcast and the work went to an InfoPrint PSP. HP must have done the deal with Nat Geo for personalized covers, but I think CGX got the clicks on their Indigos.
I notced that Xerox did an MPS deal with Universal Orlando Resort and then "collaborated with Xerox to test a cross-media, one-to-one marketing campaign leveraging industry-leading XMPie® PersonalEffect® software."
It would be great to know who did the clicks. If it were a Xerox PSP billing at full rates, maybe it will be different this time around. But if they took it "in house" and think they are going to make a run around their PSPs, they're toast.
With all of the competition from the indigo in the commercial space and Ricoh et al in the laser print space, if they don't get this right, my bet is that some private capital is going to come in and do to them what KKR is doing with Kodak.
By Scott Dubois on Oct 30, 2009
It is silly to worry about Xerox competing against you for print output. If what you are bringing to the marketplace is just printing, there is nothing special. What most companies in the "print" industry don't understand is that a great salesperson, client service, quality, or on-time delivery are not special; they are a given and expected.
There are things that Xerox will not bring to the table as they are a company built around clicks and images. That is their business model. Xerox will never be involved in marketing strategy meetings, host databases that execute not just print but other campaign components, or deliver creative services. In terms of value they sit at the bottom of the food chain. What is of note is that in terms of enterprise TCO they sit at the top of the food chain. The items listed above are how you combat that.
However, if the deliverable is print, good for the client for going with the lowest cost over a long term contract. After all... it just makes them a smart consumer.
By Scott Dubois on Oct 30, 2009
@Miichael J Xerox did not do the Universal campaign, it was executed by DME in Daytona Beach. Just driven by Xerox (XMPie) technology.
By Jack on Oct 30, 2009
Grover I know a small print/copy shop where your story happened almost exactly the way you described. Unbelievable.
By Grover Daniels on Oct 30, 2009
Scott, You are right on.
Printers have evolved, we have changed, and we contiue to change into multi-communication service providers. The best "print" salesperson is a consultive salesperson for print and marketing.
Didn't XX just buy a consulting company?
By Miichael J on Oct 30, 2009
Scott,
Congrats to DME. That's great news to me and is a good data point for a change of culture at Xerox.
By Curtis Johnson on Nov 01, 2009
Scott,
As you stated, the EPS is currently at the "bottom of the food chain"; but, where do you think it's headed? These vendors will be trying to control how you print. The more you allow them to do this, the more they influence your ability to make the right decisions for your company's best interest; instead, of the best interest of the EPS provider. Once these EPS providers are entrenched in your company; your ability to change will be difficult.
By Michael J on Nov 01, 2009
Chris,
When you ask "where do you think it’s headed? These vendors will be trying to control how you print "
I think it's just another step to insourced and outsourced coporate print buying. Much of the global work is done by preferred vendors under contract all ready.
I would be surprised if Xerox is either set up or focused on any company below the Fortune global 1000. Many of these companies already have well defined network partners for outsourced print.
As long as Xerox does not make the mistake of trying to do the clicks their competition is Donnelly and other Business Process Outsourcing companies.
If on the other hand, DME is picking up the clicks that seems to have been generated by Xerox's work with Orlanda Theme Parks, I think we may be seeing a print eco system that gets the incentives in the right place.
Commercial printers get the benefit of the workflow, Xerox gets the benefit of the Enterprise Print Services, and the global gets a way to control print costs both inside and outside the enterprise.
The real opportunity for printers and independent MPS is a bit lower on the pyramid. Small businesses and enterprises doing between 10 and 100 million dollars of business.
By Curtis Johnson on Nov 01, 2009
Michael,
I believe any Fortune Global 1000 company has resources to create a better company print network than EPS providers. I would think EPS providers would target smaller companies that don't have the resources to create in-house plants and efficient print networks. It comes down to if a company wants to control their printing or have someone else deal with it.
By Cary Sherburne on Nov 02, 2009
Curtis, I would respectfully disagree. While many do have the resources, they would often prefer to hire an expert. That is why Standard Register has done so well with this over the past several years. Xerox has been providing similar services for a long time, but is kicking up the heat on those services with new technology that allows them to incorporate the remote workers as well. I think this is a step beyond what Standard Register is doing, but I am still checking on that.
It is not so much the creation of the print network as it is the effective management of the network from the perspective of changing employee behavior, monitoring costs, and deciding which is the most cost-efficient device job by job. Most enterprises, in my experience, don't do a very good job of that and users run rampant.
By Cary Sherburne on Nov 02, 2009
I have been able to confirm that the Standard Register offering also encompasses remote workers as long as they log into the VPN, which I assume is a requirement in the Xerox implementation as well.
So from a service perspective, the key difference today EPS services offered by Xerox and the similar services offered by Stanbdard Registe would be that Xerox is not including outsourced print in the overall assessment model; only work that is currently being done in house. Whether their analysis results in some of that outsourced work coming back in house remains to be seen. I would be surprised if Xerox does NOT implement something in the relatively near term that engages their Premiere Partners to begin channeling some of the enterprise work to those customers when it makes sense to do so.
In either case, these types of services are attractive to many Fortune 1000 customers, perhaps even more so than smaller customers, although that latter comment is merely an assumption on my part.
By Michael J on Nov 02, 2009
Curtis,
Not much to add to Cary's comment, but consider how hard it is for a Fortune 1000 to focus. it's not a problem of resources or knowledge. It's more about different parts of the enterprise fighting for turf instead of getting it done.
I think one thing that gets attention from the C level is to eliminate the turf fights by outsourcing the function.
The problem at the middle and small (1 to 100 million dollar) enterprises is that management is too busy and distracted to have the focus to solve not crisis problems. The cost of making that sale is, IMHO, too large for the incremental benefit to a Xerox or HP.
That's the opportunity for independents.
By Carl Gerhardt on Nov 02, 2009
It would appear to me that how Xerox behaves going forward is the key issue. I don't really see that what they are doing as a direct threat to PSPs the same way the HP MarketSplash program was positioned. Our big objection to the HP program was HP putting themselves between the PSP and the customer..controlling pricing etc. and playing God on who gets the order.
However, there are still a good number of PSPs that lack trust in Xerox because of some of the scenarios mentioned above that have occurred in the past. If Xerox acts with integrity with this new program they can put all of that behind them in time. Trust but verify.
By Curtis Johnson on Nov 03, 2009
Cary and Michael,
I understand expert experience is valuable; the problem is, it is specific to brand. Xerox experts are not going to recommend a better HP solution to the client. If I gave all my travel arrangements only to United Airlines; do you think they could get me to my destination faster and cheaper than if I could book travel comparing all brands? If these large companies' "rampant users" cannot make decisions in the best interests of their own company; then, maybe EPS is needed (or those users need a new job). The turf fight still remains; except the EPS provider is involved as well. As the EPS consolidates to save; resources to the company are limited (the conference room printer is now the long stroll to the printing room; is convenience a waste if it saves time?). I still believe a well managed company print network can be better for the company's interests than an EPS provider can deliver.
By Michael J on Nov 03, 2009
Curtis,
You make good points. It's going to probably be different for every company.
The difference these days is that Xerox has to compete on the outsourcing with HP, Standard Register and all the other players on the global level.
It used to be that Xerox was the default choice for large enterprises. The "brand" was good enough to provide the insurance against failure which was a real value. Because they offered the best failure insurance they were able to command good margins and were somewhat shielded from price competition.
Given the recent kerfuffles about too high prices for copiers, especially in the education installations, I think it's fair to say the days of "nobody got fired for choosing Xerox" are drawing to a close.
Meanwhile, on the ECM side, Google has won the contract to supply email infrastructure to Los Angeles beating out Microsoft. If someone uses a Google API to incorporate print fleet management into Google Wave, it could bring the real 10,000 gorilla into the space. With the advantage moving to inhouse print services and independent MPS.
What I think I see is that competition will lead to a race to the top. Internal print service offices will have to compete with outsourced alternatives to maintain their positions. HP with Canon, Xerox as well as Oce, Ricoh are all fighting for the MPS piece. Connecting the MPS to a network of PSPs seems like a natural evolution.
It's going to be very interesting to watch as this all plays out, especially for the commercial print manufacturers.
By Henry Freedman on Nov 05, 2009
One approach to protect the print shop that should be considered is to require the Xerox
and other vendor representatives and service people sign an NDA.
Xerox says they will keep your business and work confidential and not compete with you so they should not have a problem with an NDA.
Trade associations should help here in having such a document prepared. It is just good business practice.
Discussion
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