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.