So much talk so little success

Here we are...all talking about MPS as the solution to all of our problems: decreasing sales, deteriorating margins, world hunger, etc. Yet for all the chatter we then look around and wonder who is really having success with this thing?

Go ask Photizo and you can get stats on how Xerox or HP are leading in market share. But look around your neck of the woods...do you really see anyone dominating?

Art Post had an interesting survey running. He was asking vendors to rate their experience with MPS so far. The results were a little surprising. Almost 47% said that they were either not reaping the profits they expected or would not have gotten into MPS if they had to do it again.

So what's the reasoning behind it?

I think a lot of it goes back to the endless discussion forums that debate the definition of MPS ad nauseum. Unfortunately the entire purpose that MPS was supposed to serve has been lost through the well intentioned efforts of vendors to understand what this whole thing is about. The ol' can't see the forest for the trees example.

We get so lost in what MPS is, or is not, that we forget that the only thing that matters is what a specific prospect thinks. Better yet, what problem can you as a salesperson solve through combining a wider set of services?

So why is there so little success, or should I say so little success in the SMB market?

When you look at the 800 lbs. gorillas (i.e. HP, Xerox, etc.) they have some distinct advantages. First, the majority of their deals are selling enterprise accounts where there is typically a much larger problem with a much larger financial payoff. Secondly, the salespeople calling on these accounts have more refined sales skills than your typical SMB salesperson.

This second issue is probably the biggest challenge facing companies entering MPS. The problem is that you have a collection of salespeople that have been selling a specific product or service for years and now they are asked to change what has made them successful. Now that's a recipe for disaster.

Until vendors in the SMB segment figure out how to make this transition we will continue to see the similar reports out of those jumping into MPS.

The practical result of defining MPS is a company starts selling a different widget. The problem with that is that maybe the client doesn't need that widget. Maybe they only need one part of the widget...or maybe they need a bigger widget..or a completely different widget.

Every sale should begin and end with the client's problem and a determination of if/how you can solve that problem. Lose sight of that and it doesn't matter what you're selling...you will be destined for mediocrity.

Tell me again why I want to sell hardware...

Back when I started selling copiers for Lanier I'll never forget when the VP of Sales came into our district office and practically bragged about how we actually loose money by selling hardware and that service is where we make all of our money.

I was fairly young and naive at the time and just figured, well they must know what they're doing since there is this big business built on this idea.

As I've stayed around the industry for a longer period of time it seems to be one of the more universal beliefs...you're going to loose money selling the box and make your money servicing it.

What I couldn't understand back at Lanier, and still think is ridiculous, is why otherwise successful business would intentionally choose to continue a wholly unprofitable line of business! Let me get this straight - you're making 50% margin on your service but losing 10% on your hardware and you believe that this is a solid business model?!?

I've asked the question within my own company (which is hardware driven), and it seems to be something no one has ever considered. It is just accepted that you have to sell the box to be able to service it.

Well, as we all move toward MPS hopefully we can throw that garbage out the door.

How about a new idea? Let your competitors sell the hardware (and lose money in the process) while you service it (and make all the profit).

Can't be done, you say??

Sure it can. Just go call 3 copier dealerships telling them all you want to do is buy a copier without service and watch the rabid dogs come running at you with quotes.

Sooooo, tell me again why I want to sell hardware...


P.S. This was written on Sunday morning. If you see my resume as the next post you will know that this message was not received well by my own organization.

Soooo what the hell is MPS?

Lately there has been resurgence of discussion over the definition of MPS in discussion groups. Honestly this has become a very tiresome, repetitive effort that doesn't seem to make much progress.

Early in the year this was the hot topic. Everyone was jumping into MPS and touting their version of MPS. Until recently it appeared that everyone went back to their business and were trying to see what results they achieved using their respective definition.

Now it appears that more MPS community members have come to realize that a definition, in and of itself, is completely useless unless it addresses a prospects business problem. And their problem is not that they pay too much for toner, service, etc.

The value that MPS provides does not exist in a vaccum. It is relative to the current business environment of each prospect. And, more importantly, that value can, and will, change over time. The flexibility of a providers program will, long-term, be proportionate to the success that they realize in delivering MPS.

It seems widely accepted that the "gold standard" of MPS is a provider that can manage any fleet regardless of the device manufacturers. This has been a difficult pill to swallow for the majority of MPS providers because they come from a hardware background. This mentality says, "If I can't service the device with my own technicians, how can I manage it?"

If the only value you bring to your clients is your response time, uptime %, first call completion %, etc., then you just aren't ready to turn your company from a copier or printer company to an MPS company.

The really valuable stuff that the best MPS providers bring to the table is their intellectual capital. A well rounded knowledge of the tools available in the marketplace to create a more efficient flow of communication (in the form of documents/data) and the ability to put that knowlege to work in the real world is what separates the men from the boys in MPS.

Too many people are still focused on the hardware and service metrics to see that there is more to the picture. Further, only a small group of those that have the intellectual capital to design these kind of solutions can effectively deliver them.

The good news for everyone out there is that not every prospect is looking for a fully evolved MPS solution. Prospects are still in the infancy of their adoption so, for the time being, the majority of MPS opportunities are up for grabs. And there are a lot of companies that can deliver MPS as long as it involves nothing more than hardware and the associated service.

Define it how ever you like. There are many ways to skin a cat. Just make sure you don't kill the cat in the process.

Soooo, what the hell is MPS?

Forget what you or I think about it. Ask your prospect! Their opinion is the only one that matters anyway.

Keep It Simple Stupid

I remember back in the early days when I was a copier rep there were only a few places to gather professional advice. There was my sales manager and my fellow reps and that was about the extent of it.

Since then the online/social networking world has exploded with seemingly a LinkedIn or discussion group for every topic known to mankind. But how do you know who to listen to?

In the old days you knew to look at the sales board every month and see who knew what they were talking about. But in the online world it's difficult to know if someone really knows what they're talking about or if they're just spouting their own opinion without any real success backing up their statements.

Then there comes the question of credibility. Unfortunately, there are many people today who will take credit for accomplishments that they either had little or no influence in creating.

When you look at various online discussions about MPS most of the conversations end up in some cerebral, ethereal definitions or tell others what is wrong with what they are doing (guilty as charged).

At the same time I see a large number of companies looking to adopt MPS as a strategy moving forward, yet struggling to effectively implement this strategy. So what could be the problem? Is MPS really that difficult?

It is if you make it that way!

Most companies looking to adopt an MPS strategy have had some relative success at their existing business. The problem I see with MPS strategy is that it is taught as a "change in thinking" of how business is run. So previously successful companies are now told "You're going to be out of business in 5 years" or "You need to change what you're doing". Using this fear to motivate change business leaders look to make dramatic shifts in an otherwise successful business.

Fear is not a good basis for business decisions.

Let me suggest this: While MPS does require a change in thinking, perhaps it is not as dramatic a change as some suggest. Instead, understand the principles of MPS and learn to integrate it into an existing, successful business.

Don't stop doing what it is that got you to where you are. Simply adjust the course to capitalize on the current opportunity.

Honestly, I'm not 100% convinced that MPS will become the world-beating force that it is sometimes portrayed as. I do, however, believe that it is a great opportunity to provide value to clients.

So the moral of the story...KEEP IT SIMPLE STUPID!

Don't abandon your previous successes because some consultant, industry expert, or a bunch of people in a discussion group told you to.

Do it with a plan. And do it because you believe it will add value to what you already provide.

Customers Don't Know What They Don't Know

Posted by Ken Stewart (LinkedIn, Blog)


How many times have you been attempting to talk to a potential client and they are just not picking up what you are putting down? You can tell the light bulb just hasn’t turned on as you are presenting…

Now, how many times have you been sold to by someone you didn’t think understood your problem, your need, your “hot button”?

For those in the document imaging business dealing with, struggling with, or embracing what has been termed as Managed Print Services (MPS) or even electronic Document Management Systems (eDMS), this is all to often the case. The customers just are not getting the concepts.

What is even more frustrating is when I support account managers that just don’t get it either. They haven’t flipped that switch to helping in a more consultative manner. Don’t get me wrong, these reps aren’t trying to sucker clients into buying something they don’t need, but they are an empty suit - throwing out buzz words like “right-sizing” , “TCO” (total cost of ownership), and my favorite - “solutions”.

When I ask, just what is a “solution” anyway? I get all manner of answers, but the bottom line is that there is no 1 definition of “solutions”.
So I would ask, what are you selling your customer if you don’t know? That’s the first question; you must know yourself and your line up to be effective in helping your customer solve - get this folks - THEIR business problem.

Not your business problems; their business problems.

Next, how do you sell to a customer who doesn’t have that light bulb moment about your “solution” to their problem - or doesn’t think they need your “whiz-bang”?

Education

Education is the key to enlightening customers. It isn’t enough to tell them they need it, they have to understand operationally how they need it, how it impacts them, and how they can be better with your solution than without.
Education requires investment, on your behalf, as well as caring for your customer. There is no shortcut to relationship building, and you wouldn’t want that.

You have to teach your clients the difference in a McDonald’s hamburger and a Filet Mignon; you have to show them the value of a marriage with you versus a one-night stand.

Folks, if you are not talking the same language as your customers - and your customers don’t get the emotional and operational impact of what you are selling, you are not going anywhere.

The 1-2-3’s of MPS

In summary, your customers might be just starting to talk about getting a handle on their document output costs as a tactical reaction to today’s economy. But most haven’t even heard of MPS- and even fewer understand cost reduction as a strategy, or the long tail of e-DMS strategies.

Why not?

Simple: Education.

Three to five years ago, many customers didn’t know what ’scanning’ was - unless you were talking about a police radio or reading a book very fast. Through the advent and proliferation of technology, this is now a must have in just about every office in America - and it comes with the MFP of your choice… there is almost no option. Scanning is now the power-locks and power-windows of the document industry.

That’s where you want to be, but you have to 1) BELIEVE it can benefit your client and 2) TEACH your clients how to achieve results with their ‘new solution’.

Let’s face it, they may buy from you once, but if they didn’t achieve results, as promised, you will have violated that sacred bond and dishonored your relationship with that client.

Teach, show, and educate your customers on what they are missing - what they don’t know!

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Ken Stewart’s website, ChangeForge, focuses on the collision between the constantly changing worlds of business and technology in an information-centric world. He is always interested in connecting; to discover the many ways you may connect with him, visit him at DandyID
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When You Assess You Make an Ass Out of You and Your Prospect (Part 2)

So you want to do an assessment, huh? So you enjoy short-changing your clients? No....then don't do a stinkin' assessment! Look, assessments are like a**holes...Everyone's got one and they all stink!

Okay, not everyone. But 99.9+% do. There aren't many people out there who do more than get toner cartridge cost and run a rapid assessment key. Armed with this high quality data they make assumption after assumption after assumption after assumption that shows, with 100% surety, that they can save this client 30% on their current costs. Oh dear Lord, what a miracle!

I've given up the assessment fight and just decided to find a different word. I'm tired of being lumped in with all the reps that do the same "show up and throw up" story in front of every client. Don't associate me with those limp attempts at "consulting".

The fact of the matter is that salespeople who use a quick and dirty "assessment" not only short change the prospect, but themselves as well. By not doing a thorough job of identifying the true cost of operating the environment salespeople leave costs, and potential margin, on the table in an effort to get pages under contract. When you understand where documents originate from, and the purpose that they serve, worlds of opportunity present themselves. Suddenly you stop playing the commodity game.


Since the CFO is my primary contact point why not choose a term that they are familiar with, something that has some meaning behind it? Of course, if you do not understand the CFO language you can quickly show yourself as a poser trying to use big words you don't understand.



Let's think about this. We want to deliver an impactful message to the CFO. What is a term that they understand and could have some meaning to them? Well, just about every CFO has some kind of accounting background. So what are accountants most known for in business. I would venture to say audits. So let's take a look at the word audit.



au⋅dit 

–noun
1. an official examination and verification of accounts and records, esp. of financial accounts.
2. a report or statement reflecting an audit; a final statement of account.
3. the inspection or examination of a building or other facility to evaluate or improve its appropriateness, safety, efficiency, or the like: An energy audit can suggest ways to reduce home fuel bills.
–verb (used with object)
6. to make an audit of; examine (accounts, records, etc.) for purposes of verification: The accountants audited the company's books at the end of the fiscal year.
8. to make an audit of (a building or other facility) to evaluate or improve its safety, efficiency, or the like.

Dictionary.com UnabridgedBased on the Random House Dictionary, © Random House, Inc. 2009



Hmmm...how appropriate is this? Let's examine #3 above. "The inspection or examination of a building or other facility to evaluate or improve its appropriateness, safety, efficiency, or the like". Not bad. Obviously we're not examining a facility, but if we substitute process in its place we may be on to something. But what does this mean?



If you talk with auditors about the process of auditing they will tell you that it is NOT about numbers. It is about examining processes. For an auditor to go through and check all the numbers processed in a company would take forever. Instead, what they do is examine the process that figures go through within a given company to determine if the process is appropriate for the desired outcome.



What does this have to do with MPS? The answer is that by engulfing ourselves in meter readings, supply costs, support costs, etc. we are missing the bigger picture. It is a very myopic view of the world. The value lies in understanding not how much is being printed and what it is costing, but rather in understanding the associated processes. What is the purpose of a given document (or better yet the information it contains), why is it being printed, is it necessary to deliver the desired outcome?



If you can understand the answer to these, and other, questions you are begining to uncover the real business opportunity that MPS (or whatever you want to call it) presents. By stepping back and looking at the bigger picture you provide you and your client with more valuable information and the ability to deliver more impactful solutions to address issues of more importance than "What are you paying for your supplies?".



So dump the "assessment". What good is it doing anyway? I guess it's good for prospects who can take your information and write their CPP RFP from it, but what are you getting out of it?



"There are no shortcuts to any place worth going."

- Publilius Syrus (~100 BC)

When You Assess You Make an Ass Out of You and Your Prospect (Part 1)

If you've been around MPS for more than 10 seconds you have undoubtedly heard the term "assessment" thrown out. In fact if you hang around too long you're likely to hear the term ad-nausea.

I recall a debate about what should be a part of an assessment. Is it simply collect meters and toner cost or was there more? It's safe to say that there should be more involved unless you're a drill and fill working out of your garage.

Of course that led into those who questioned whether it was even necessary. But eventually those people saw the latest hardware SPIFF and forgot all about the MPS conversation.

I'd like to question something even a little more basic, the terminology. I have always been a firm believer in collecting hard numbers to eliminate any debate on the validity of the data. What baffles me are those that are advocating a 2-week meter collection and then use average street price to tell a client how much they are spending. And they are all over the place...software companies, manufacturers, even CONSULTANTS. I mean seriously, if you paid some guy and this is what he told you to do you need to go demand a refund.

I know this is silly, but let me put myself in a prospects shoes.

Sales Rep: "Mr. Prospect did you realize that you're spending over $3,000 per month on your printers?"

Prospect: "I'm not so sure about those numbers. How did you come out to that?"

Sales Rep: "Well we took two meter readings and then exterpol.......exptralpo.....etaxper..... calculated what that came to for a monthly volume. Then we looked up the average price for each of your supplies and divided the cost by the yield to get your cost per page."

Prospect: (After coming out of the trance)"Well I pulled my invoices and I only spent about 2/3 that number in the last 6 months. I'm not buying it."

Sales Rep: "Well sir, the software we use takes into account a lot of variables that you or I may not think of."

Prospect: "Like what? I can prove to you how much I spent."

And on the story would go. The methodology described is nothing more than a repackaged hardware mentality. Instead of just sell the copier, it's "just get the volume under contract"...and do it quick before they realize what's going on.

Now don't get me wrong, I am all for a fast and efficient sales cycle, but how about we be a little more intentional with what we do.

So, let's look at the definition of "assessment".

Assessment

1. The act of assessing; the act of determining an amount to be paid;
2. A valuation of property or profits of business, for the purpose of taxation;
3. The specific sum levied or assessed.

Webster's Revised Unabridged Dictionary, © 1996, 1998 MICRA, Inc.

Is it just me or does that sound like you're setting up a prospect to screw them? So what do we do? What is or is not applicable to the cost of printing within an organization?

In the second part of this article we will take a look at how to approach the "assessment" and work to find a better definition of the first step in an MPS engagement.