reduce costs through printer consolidation

Practical IT Research that Drives Measurable Results

Reduce Costs through Printer Consolidation

1Info-Tech Research Group

Introduction

• Printer Consolidation (PrC) is a process that will optimize the printer fleet to decrease the cost of hardware, consumables (paper, ink, toner), electricity, and maintenance.

• Strategies for consolidation include:– elimination of inkjet or high-cost printers– sharing of workgroup printers,– use of multi-function devices

• Info-Tech Research Group has found that PrC is an initiative not widely implemented despite its cost-saving potential.

• To understand why this is the case, Info-Tech conducted a series of interviews with clients of various industries and sizes who recently underwent, or are currently undergoing PrC. The findings are summarized in this Storyboard.


Executive Summary• Organizations can save as much as 65% of total printing costs through printer

consolidation (PrC) efforts, making this a very compelling savings initiative.

• However, most organizations are unaware of the savings potential of PrC.– Many organizations have no aggregate view of the total cost of printing and

no one responsible for managing it– PrC is often an unpopular initiative with end-users– Without this visibility, it is difficult to muster executive commitment and

support for PrC

• To achieve savings and overcome barriers:– Assign accountability for tracking printer costs to a single

department/stakeholder group– Prepare an inventory of printing devices and a profile of usage,

requirements, and costs– Identify areas to eliminate or reduce the number of devices to calculate

potential savings– Educate and communicate the benefits of PrC to executives to gain buy-in

and support– Anticipate and plan for end-user resistance


Nobody has ever died from a paper cut:Understand PrC benefits and barriers.


Understand PrC

Benefits: Both Kinds of Green Barriers: Why No One Cares

ImplementCreate

Accountability

Prepare the Inventory

Identify Savings

Opportunities

Make the Business

Case

Manage End-User

Resistance

Manage Mid-Term Strategies Long-Term Strategies

Consider the following three examples of Info-Tech clients who realized significant cost-savings from their PrC initiatives:

Every desktop printer eliminated from the fleet can save you approximately $500 per year.


0%

20%

40%

60%

80%

100%

Hardware Cost Operating Cost Total Cost

5%

95%

100%Print device hardware costs

are just the tip of the iceberg

Source: Info-Tech Research Group

See all in-depth case studies

here.

100%

Poorly controlled print environments breed unnecessary print costs.

1.A large public healthcare firm realized $285,000 in annual cost-savings by

eliminating 1,016 devices and replacing them with 721 more efficient devices that have a lower $/page cost.

That has resulted in almost $1,000 saved per eliminated

device.

A small manufacturing firm identified $40K in

annual cost savings from eliminating 70 non-networked desktop printers from their

environment and moving fully to networked MFPs.

A small not-for-profit firm reduced their TCO for

printers by 50% by eliminating 16 out of 35

standalone printers.

These cost-savings can be realized with the following actions:

• Elimination of cost-inefficient inkjet desktop printers

• Elimination of high-cost, inefficient, or underutilized printers

• Sharing of workgroup printers between an optimal number of end-users

• Replacing separate printers, scanners, copiers, and fax machines with multi-function devices

Do not ignore the cost-saving potential of PrC.

6Info-Tech Research Group* Source: Interviews with Info-Tech clients

Low Pain InitiativeMedium Pain

InitiativeHigh Pain Initiative

Cost-savings($/user/year)

~ $30 $60 - $75 ~ $200

Initiative Description

Passive strategy to eliminate devices through attrition

Moderately eliminate and consolidate according to usage and duty cycles

Actively eliminate and consolidate devices, and use aggressive print strategies (chargeback, outsourcing, etc.)

Device Purchases

Electricity

Maintenance

Consumables

The more aggressive the organization’s PrC initiative, the greater the cost-savings potential

PrC saves more than capital expenses.

Info-Tech Research Group 7


N=96

Non-monetary benefits met or exceeded expectations in over 75% of initiatives

By any metric enterprises use, cost-based or otherwise, PrC initiatives are overwhelmingly successful:

Operating expenses were reduced in over 80% of initiatives

PrC presents organizations with an opportunity to become greener.


[CEO] would be very supportive, but it can’t be money spent for green based solely on green. … [We have] to come up with something that [can] save me money and be green at the same time. …But because the cost of electricity is leveling out throughout the United States, it has now become a business initiative at a higher level to be much more concerned about energy usage.– CIO, Health Services

Better green practices can align with increasing revenues. … everybody used to think that corporate social responsibility was equal to spending money on programs that was [going to] actually hurt your bottom line, but I think that’s not the case with being green. I think if you align it right, it can definitely help you. – IT Manager, Public Healthcare

Consolidating and eliminating devices in the printer fleet allows organizations to reduce their carbon footprint and save costs in the following ways:

•Reduced electricity consumption

•Reduced use of consumables (paper, ink, toner)

•Reduced hazardous waste from consumables and devices

Green not only benefits the environment, but can also help the bottom line.

“

“

“ “

Four barriers commonly prevent many organizations from recognizing the cost-savings opportunity of PrC.


12

34

Executives

Executives frequently question whether it is a worth-while initiative due to a unclear idea of the savings potential and the prospect of end-user backlash.

Accountability

Printer cost tracking responsibility is not assigned, or wrongly assigned to multiple groups. This leads to out of control costs without the organization even realizing it.

Process Opacity

Organizations often lack the tools and data needed to uncover the cost-savings potential.

End-Users

The initiative faces extreme end-user resistance that inhibits successful implementation.

Executives are not convinced that PrC is worthwhile.

• Executives often see PrC as a lower priority issue since PrC cost-saving opportunities only seem significant when aggregated – which rarely happens.

• Cost-savings seem insufficient for the required effort, especially given limited IT resources.

• Executives face a trade-off: cost-savings versus end-user satisfaction. The challenge and grief associated with end-user resistance and backlash tends to outweigh perceived benefits.

• Unless the fleet of printers is large (and significantly underutilized) or old (resulting in high maintenance and cost per page) these initiatives may roll up under other asset management projects which are low on the priority list.


Finance

Printing

vs.vs.

1

PrintingHR + Finance +

Marketing + Sales + Operations

HR Printi

ng

Marketing

Printing Operations

Printing

Sales Printin

g

Managers in many organizations wrongly assume that since

IT manages the printer devices, they also manage costs.• Printer costs (paper, ink, toner,

electricity, maintenance) are often budgeted and tracked by each department, not aggregated into an overall budget category.

• The different categories of costs are often tracked by different groups:– Consumables and one-off leases are

line of business items tracked by Supplies/Facilities

– Depreciation expenses are tracked by Finance (sometimes IT)

– Maintenance expenses are tracked by IT

• No stakeholder’s performance (i.e.

IT) is measured against the controlling of printer costs, so there is no incentive to track and reduce it.

• End-users order printer devices and supplies through the Supplies/Facilities department which bypasses any budget approval process, or through IT, which does not have the authority or incentive to restrict requests. 11Info-Tech Research Group

N=187

Organization-wide printer usage policies are rarely enforced with any strictness.


2

Without systematic policy enforcement, end-user print behavior becomes frivolous and generates massive printing costs.

The road to uncovering cost-savings opportunities isn’t smooth.

• The process to identify the entire fleet, assess requirements, and uncover printer costs requires significant tracking and documentation tasks, which are laborious and difficult for FTE-constrained IT departments.

• Non-networked desktop printers are often used without the knowledge of IT, and are notoriously difficult to track.


3• Asset management in most organizations is

neglected. Printers are typically last priority for managing after servers, desktops/laptops, and licensed software.

• Tools available for tracking printer utilization are lacking. Asset management vendors (e.g. Web JetAdmin, Netaphor, etc.) provide tools that do not necessarily integrate, report consistent data, or capture non-networked devices such as inkjet desktops.

73% of organizations do not have print

management software that can uncover cost-

savings


N=44

End-user resistance is a large barrier to effective PrC.

PrC is a cultural change.

Lax device procurement policies foster a climate of end-user entitlement to their own desktop printers:

End-users often cite that their personal printers are…• Required to perform duties; necessary

for productivity, workflow, ergonomic reasons

• More convenient than walking to network Multi-function Printers (MFPs) and waiting in queue for print jobs

• More secure; not believing in biometric/password-release functions on MFPs

Printing policies are difficult to enforce. End-users tend to avoid them, or work around them, especially if senior executives are not fully on-board and do not lead by example.

No one wants to be responsible for physically confiscating desktop printers – especially from executives.


Desktop printers were purchased on company cards… users think they are entitled to them. … People are resistant… it’s the convenience of walking no steps versus walking ten.– IT Director, Manufacturing

4


N=44

“ “Two thirds of organizations found end-user resistance to be a significant barrier.

With proper management, barriers were not significant

and did not prevent attainment of benefits.



N=108

Organizations which

conducted PrC initiatives were

able to overcome barriers

Don’t cry over spilled ink: Implement PrC.

Understand PrC


ImplementCreate

Accountability


Identify Savings

Opportunities

Make the Business

Case

Manage End-User

Resistance


To achieve savings and overcome barriers, follow Info-Tech’s four-stage approach:

3. Gain executive buy-in

4. Educate end-users1. Track

printing costs under IT

2. Identify consolidation opportunities


Leverage executive buy-in to educate end users

and influence changes in their

print behavior with minimal resistance.

Create aggregate print accountability

to track and inventory print

devices, determining

aggregate print costs.

Use aggregate cost data in conjunction

with usage, requirements, and

cost to uncover cost saving

opportunities.

Present cost saving

opportunities to executives to

gain their buy-in.

Gain high-level executive buy-in to set the tone for PrC.

• Communicate the benefits of PrC to executives:– Cost-savings benefits– Green benefits

• Cost tracking and reporting to management are iterative:– Executives provide covering fire, but require proof that the initiative is

worthwhile– Plan for multiple management check-ins through each step of the

process

• Do not attempt to undertake PrC initiatives without alerting executives


[Printer Consolidation] needs to be driven from the top which is why we need to make the business case for it.– IT Manager, Government

[The executive team] understand costs. They’re an easier sell than the end-users.– CTO, Media & Entertainment

Scenario: Print policies are not being strictly enforced.

Case Study:Public administration firm has over 80 non-networked desktop printers deployed and is currently consolidating, but doubtful of success due to low executive buy-in.

Read the in-depth case study here.

Cautionary Case Study:

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Recommend that the responsibility to track print device costs be allocated to IT.


[Printing] utilization figures for each department are openly published and viewed from the top. … If costs are higher than expected, the executives will flag it. Managers don’t want to see highlighted cells when they get their statements back, so they have incentive to control it.- IT Manager, Tech Services

Aggregate ResponsibilityIf printer costs (paper, ink, toner, electricity, maintenance, lease expense, etc.) are spread across the budgets of various silos or departments, recommend to executives that all printer costs be aggregated under IT’s budget, and tracked by IT staff. These changes requires no new costs making them easy sells to hesitant executives.

Assign Accountability

Although supplies (paper, ink, toner) may continually be procured by the organization’s Supplies/Facilities department, monthly usage/costs (by departments) should be tracked by IT.

Enforce Policy

Recommend that IT be empowered with the ability to enforce a strict procurement policy that ensures all devices in the printer environment are approved models and under IT’s control. This eliminates having unknown devices in the printer fleet along with associated costs; and, allows for economies of scale to be realized from purchasing standardized printer supplies.

Track MetricsIT should establish metrics to measure and control each department’s printer usage, and flag departments that exceed their acceptable usage amounts (as determined by IT). Reporting these figures to the executive team will provide incentives to reduce usage. Use these metrics to gain further executive buy-in.

“ “

Prepare a baseline inventory of printing devices and costs to identify potential savings.

5. Identify the opportunities for improvement

1. Take an inventory of the fleet

Refer to automated discovery tools, network mapping, and do a physical walk-around to understand what devices are in the printer environment.

2. Assessthe fleet requirements

Understand the application & network, platform, security/privacy, and supply requirements of each device.

3. Assessthe fleet costs

Determine the costs of each device: purchase price, consumables (paper, ink, toner), maintenance, lease/depreciation expense, and downtime costs.

4. Solicit end-user input

Interview or survey end-users to understand their requirements and identify problematic devices.

Use the results from the previous four steps to identify devices that can be eliminated and areas where devices can be consolidated without harming workflow and productivity.


Refer to the addendum, “Uncovering the Cost-savings of Printer Consolidation: Process Roadmap” for a more detailed step-by-step guide

Ensure visible executive support to achieve higher cost savings and lower end-user resistance.

Use the cost figures from identified opportunities for improvement to sell the initiative to executives.

• Visible support and buy-in of the executive team creates cost-savings above .01% of total revenue for the organization.


The first person to get rid of their desktop inkjet was the CEO. All executives had desktops removed from their offices.– IT Manager, Public Healthcare

Scenario: End users are hesitant to give up their desktop printers.

Case Study:Public healthcare organization that supports 8,000 end-users realized one-time savings of $450,000 and an annual $285,000 in cost savings…



N=23

“ “

Centralize, consolidate, and replace.


Whenever possible, consolidate to as few models as feasible.

•Choose MFPs over standalone printers whenever possible. •MFPs costing three times more than a mid-range laser printer may be a wise purchase if the device is less costly to operate on a per-page basis. •At high printing volumes, upfront purchase price pales in comparison to savings from efficient toner and supply use.•This not only allows for elimination of redundant devices such as fax machines and scanners, but also lowers TCO, since cost-per-page is typically 50% lower than with dedicated laser printers.

Centralize and network all possible devices.

• When making equipment and supply decisions, always remember that equipment typically makes up only 5 to 10% of the total cost of ownership.

• Operation of printers, including supplies, maintenance, and repairs, represents the rest, so costs are further decreased when only a few types of printers need servicing and supplies.

Scenario: High print cost/page; no standardization.

Case Study I:Media & entertainment firm reduced $/page by 50% by consolidating and standardizing their printer fleet. Better deals could be negotiated with printer, toner, and paper vendors.

Case Study II:Tech firm consolidates and standardizes to two device types has decreased TCO by 20%.

Read in-depth case study one here.

We had so many printers all over the place… there was no standardization whatsoever.- VP of IT, Media & Entertainment

Read in-depth case study two here.

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Explain PrC rationale to color end-user reaction.

Enforce policiesSolicit users early Explain the tradeoffCommunicate costs

Info-Tech Insight: Print services can be politically sensitive. Prepare for strong end-user pushback by securing a senior business sponsor. In smaller organizations, this is ideally a President, CEO, or Chief Operations Officer.

• Inform users of the true cost structure associated with printing • Hardware,• Consumabl

es• Electricity• Maintenan

ce

• Educate end users on the high aggregate price of frivolous printing behavior

• MFPs bring new advantages, including green benefits

• Consider their input when making device decisions

• Communicate IT’s justification for the initiative

• Prepare responses to typical end user concerns

• Use strict and consistent print policies to control end user print behavior

• Do not tolerate renegade print practices

Communicate that personal printer costs aren’t peripheral.

TCO for desktop printers is not trivial:

Most desktop printers are ink-jets that are extremely costly – $/page cost is almost four times amount for laser toners used in workgroups and MFPs

Hardware refreshes are required more frequently for desktop printers since their useful lifetime is shorter

Having multiple models of desktop printers in the fleet does not allow for bulk purchasing of supplies – cannot realize economies of scale due to a lack of standardization

Each desktop printer, regardless of utilization rates, increases energy consumption and costs

Usage of desktop printers is difficult to track and oftentimes employee induced theft/shrinkage occurs

Scenario: Desktop printers are rampant.

Case Study:70 of 200 users had desktop printers, printing a total of 20,000 pages. $40K in cost-savings is discovered from aggregating desktop printer costs and enforcing stricter print policies.


Ink is too expensive for the desktop printers – that’s all you need to know. It’s a no brainer. – IT Director, Manufacturing

“ “

Bring end-users into the process early to identify cost-savings opportunities and minimize complaints.

• Solicit the input of end-users through the surveys, and review their comments

• Consider their input when making elimination and consolidation decisions

• Require end-users to sign-off on consolidation decisions, revised floor plans, and printer policies

Communicate IT’s justification for each end-user’s argument to keep their desktop printers:End-user Argument/Concern IT Argument

“I don’t trust network storage. I want physical copies.”

Explain security and benefits of content management systems.

“I use my desktop a lot. I need it.”

Users should be printing on cheaper network MFPs

“I don’t use it a lot, so it’s not costly.”

Waste of money to maintain and power under-utilized devices

“I need security and confidentiality.”

MFPs have biometric/password-release functions

“I don’t have time to wait.” Print jobs in queue are released when users are at the device

“I don’t want to walk that far.” Devices will typically be within 50 feet - not far

People did not understand how much this costs. …Printing is an 80s or 90s habit. People are addicted to it… you need to break this habit.– IT Manager, Tech Services

“

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Explain the tradeoff between printing privileges and other cost-cutting opportunities.

Issue Talking PointEducate end-users on the aggregate costs of printing, and communicate that the cost-savings are not petty.

“What would you do if it were your company? Cut costs or cut jobs?”

Communicate the green benefits. “Decrease the amount of consumables, energy, and hardware used. Do your part to be green.”

Enhanced features and functionalities of MFPs.

“The new MFPs are equipped with special features that will increase your ease of use, output speed, and improve the security of documents.”

Don’t print “dense” documents. Avoid printing documents with many graphics or dark-color backgrounds. Print jobs with page coverage of 5% (e.g.: a text e-mail) cost one to five cents per page, while jobs with coverage of 40% cost up to forty cents per page.

Use print area wisely. For draft documents, such as presentations, users can print multiple pages on single sheets.

Enable aggressive energy savings settings. Enable energy savings on all printers, so they do not sit idle, consuming energy

Educate users on avoiding printing cost culprits.

Ensure printing policies are black and white.

Do not allow desktop printers in the printer environment.• Create a procurement policy whereby all device requests must have valid

justification and be approved by department managers and IT. • Senior executives must not be an exception to this rule. • Legitimate exceptions, e,g,: end-users with physical disabilities preventing MFP

access, are acceptable and must go through a review/approval process.

IT should discontinue supporting desktop printers and other non-approved/non-networked devices.

• Enforce policy compliance for end-users and use standardized devices.• IT staff should be reprimanded for providing support or administrative rights to

renegade end-users.

Set printers to double-sided and monochrome by default. • Double-sided documents are often adequate for internal business. • The cost of color printing is up to ten times that of monochrome printing.

Send print jobs to lowest-cost devices by default. • Make lowest cost-per-page devices the default for nearby users. • New MFPs have a cost-per-page of around half that of older network-attached

laser printers.

Info-Tech Research: Use Info-Tech’s Printer Policy template as a starting point for developing a comprehensive enterprise printing governance policy.

Use print management software to reap on-going benefits from PrC.

Understand PrC


ImplementCreate

Accountability


Identify Savings

Opportunities

Make the Business

Case

Manage End-User

Resistance


Organizations that conduct one-time consolidation initiatives are leaving money on the table.


On-going savings result from changes in end user print behavior.

Altering user behavior is difficult and requires longer-term strategy

Consider the following options for controlling behavior-related print costs:•Print Management Software•Print Outsourcing•Chargeback Printing Model

While software price points vary considerably, most solutions typically enable the following:• Granular cost control• Streamlined printer management• Behavior management

Automating print management can effectively reduce frivolous printing and associated costs

Mid-term strategies that require fewer behavioral changes can be implemented more rapidly:

•Enable print roaming and ID verification•Set up user quotas•Renegotiate print service contracts•Train users on self-support

On-going initiatives achieve an average of 41% greater annual cost savings than one-time initiatives

Source: Info-Tech Research Group N=40

Mid-term strategies require time and investment, but require few changes to user behavior and print

strategy.


Determine if your organization is a complex print environment.


Ask Yourself…

Do I require rigorous cost control (containment and/or avoidance)?E.g.: My firm is suffering from the downturn and is aggressively containing costs.

How critical is information security to my environment (IP and privacy protection)?E.g.: My law firm prints confidential documents

Do I need to make use of cost allocation for either internal chargeback or actual client billing?E.g.: My design firm bills clients for high printing volumes for their projects

Are green initiatives significant to my operations, as mandated either internally or by external regulations?E.g.: I am LEED certified and must comply

Adopt print management software appropriate to printer fleet size and print need complexity.


Complexity

Fle

et

Siz

e

Large

Small

Low High

• Printer management solutions range from tools bundled with ink-jet printers that track consumables status to software suites that track data for thousands of print devices.

• Software included with print

devices (OEM) can pool print jobs, secure access, and centralize job administration.

• Mid-level software can track costs, generate reports, and centralize management.

• Full Manage software allows for absolute enforcement of print policies and fully control of printing

Investigate the following solutions based on the profile of your organization:

Understand the tools available, identify enterprise

needs, and pursue acquisition

through dealer or industry channels.

Vendor-provided solutions are adequate control for small organizations with simple printing environments.


Profile

• Basic Print Tracking

• Print Monitoring

• Simple Reporting

• Centralized Management

•HP - Web JetAdmin•Canon NetSp

ot, •Lexmark MarkVision•Xerox CentreWare

Web, Job Tracking

•Small enterprises•<100 users•Basic print management environment•No need for chargeback strategy•Dealing with complex sales channels for third party vendors is likely a waste of resources

• Setting simple default print settings to reduce print jobs and cost to print

• Pool print jobs and secure access

• Centralize job administration

Cost Savings Opportunity

Tools You’ll Need

Vendors and Suites

SMBs with greater print control needs can leverage mid-level solutions to manage behavior.


Profile

• Print Tracking


• Analysis & Reporting


• Document control

• Basic chargeback

• Client billing

•Small-mid-sized enterprises•<500 users•Low print needs and complexity•Law firms, professional firms, accounting, design, research•Solutions start around $500, but require additional per device costs.

• Move to a utility printing model and charge each department for its printing costs to make managers accountable for costs

• Control document flow for more efficient compliance

• Client billing • Manage high

security documents

• CZ - Print Job Tracker

• PaperCut - ChargeBack

• CapellaTech - Megatrack

• Alagus Print Admin

• Antamedia Print Manager


Tools You’ll Need

Vendors and Suites

Larger organizations without high print control needs can get away with mid-level software to meet needs.


Profile

• Print Tracking




•Mid-sized enterprises•100-1000 users•High print needs and complexity•Business & Education•Solutions start around $500, but require additional per device costs.

• Single pane of glass display allows for proactive cost control

• Track costs by user and generate reports on usage and consumables to conduct informed, recurring reviews of print needs

• Brooks Internet Software -Remote Print Manager

• CZ - Print Job Tracker

• PaperCut - NG

• Nagios• Ringdale

FollowMe


Tools You’ll Need

Vendors and Suites

Full control solutions will only attract large organizations with a mature print strategy.


Profile

• Advanced Print Tracking and Monitoring



• Client Billing• Inventory

listing• Restrictions• Printer

Redirect• Usage

Scheduling

•Canon - imageWARE Enterprise Management Console•Netaphor

- SiteAudit•Print Audit•Pharos

Uniprint and BluePrint•Dell

OpenManage

•Large enterprises•>500 users•Complex print environment with high needs•Mature print strategy•Government, education, engineering, architecture•Expect to spend thousands for a tailored solution that will save time and guide cost-savings.

• Absolute enforcement of policies and restrictions to ensure printing optimization

• Quotas at user, job, type level, redirect

• Define common usage patterns and have software intervene when settings aren’t optimized


Tools You’ll Need

Vendors and Suites

Outsourcers can often take care of some or all printing needs

for a total cost that IT cannot match in-house.


Outsource highest-cost print services.

•Outsourcing print services is most appropriate for:

• Organizations engaging in high-volume, high-quality print jobs, with growing levels of output.

• Organizations with many customer-facing print jobs that include mailing.

•Print outsourcing is a long-term tactic, requiring an assessment of in-house printing costs compared with the cost for a similar level of service provided by an outside party.

•When end-to-end costs are factored in, printing, managing, mailing, and tracking high-quality customer deliverables can be up to $5 per unit.

Info-Tech Insight: Companies with more than 2,000 outbound mailings per month can realize savings of 30% to 60% by outsourcing the printing process.

Outsourcing Scenario: My firm requires very high print volume and I need to recover the costs.

Case Study:Architectural engineering firm with 3,800 end-users has realized annual cost-savings of over $10 million by outsourcing their printing and recovering 65% of costs by implementing a chargeback model to clients


Summary


• PrC is an often overlooked initiative despite its compelling cost saving potential and green, non-monetary benefits

• Successfully implementing PrC requires a structured approach to overcoming barriers:• Create aggregate print accountability to track and inventory print

devices, determining aggregate printing costs• Use aggregate cost data in conjunction with usage, requirements, and

cost to uncover cost saving opportunities• Present cost saving opportunities to executives to gain their buy-in• Leverage executive buy-in to educate end users and influence changes

in their print behavior with minimal resistance• Enterprises that conduct one-time initiatives are leaving money on the table

• Deploy print management software proportionate to enterprise size and needs of the print environment to achieve on-going cost savings

• Consider print outsourcing if your enterprise has high volume/high quality printing needs

Appendix


1.Take an inventory of the fleet

5.Identify the opportunities

Description of process:

Identify what devices exist in all office locations, and gather the following information:* Please note that this is an exhaustive list of data inputs that is recommended to fully uncover the cost-saving potential of PrC, but all inputs are not required for a rough estimate of cost-savings. •Device type (printer, copier, fax, scanner)•Network vs. non-network•Make, model, serial number•Location in office•Device owner (personal desktop, IT, lease, etc.)•Number of users supported•Monthly duty cycle (capacity)•Page count to date (# pgs printed)•Device age (in months)•Estimated remaining useful life (in months)

An inventory provides the baseline information for PrC analysis.


We did a walk-around of the 75,000 square foot office twice … and I looked at specific users to see if they hooked up printers that weren’t on the network. … I know all the nooks and crannies, and I think we captured them all.- IT Director, Manufacturing

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Back to Deck

How-to: Refer to purchase receipts, statements, service records, etc.Automated discovery tools and network mappingDo a physical walk-around of facility/office site to ensure all non-networked devices are uncovered (may be hiding in offices or cubicles)

Stakeholders: IT Director leads and oversees 1-2 IT staff at each office site takes inventory

•Depending on organization size, a team of IT FTEs can be resourced to the task•Organizations with limited IT FTEs but sufficient budget can use consultants•Print/Asset management vendors offer this service free of charge using their software in hopes that the organization will purchase the solution in the end

Accounting and Supplies department provide additional information as needed

Tool: Refer to tab, ‘1. Inventory’ in the “Reduce Costs through Printer Consolidation: Tool”.

Information for the inventory will come from a variety of sources – be thorough.


We outsourced the process to a vendor that offered to collect the data for free … It will require a couple of sit-downs with managers of various departments, but it’s great … it saves time and money.– CIO, Market Research

1.Take an inventory of the fleet


“ “

2.Assess the fleet requirements


Determine what function each device serves and howApplication & Network:

•Identify the device as networked or non-networked•Identify the device as a desktop, workgroup, or MFP•Determine what the device is being used for (internal documents, external documents, high-quality graphics/color, scheduled, ad hoc/on-demand)•Determine its place in the organization’s workflow – its dependencies (applications, processes, people) and its criticality of uptime•Determine needed features (color printing, scanning to e-mail, stapling, etc.)

Platform:•Determine whether devices are compatible with Vista/Windows 7 or with the direction of the future IT strategy

Security/Privacy:•Determine the device’s need to output secure documents and its required security features (release function, software, etc.)•Note compliance frameworks that must be adhered to (PrCI, ITAR, HIPAA, etc.)

Supplies:•Paper (size, quality), ink (color, black), toner

Analysis begins with understanding how each device is being used.



How-to: Ask department managers for input to understand the printer’s role in workflow

Stakeholders: IT Director leads and oversees 1 IT staff at each office, or allocated team visits each office site, or vendorDepartmental managers for input on device dependencies and requirements

Tool: Refer to tab, ‘2. Requirements’ in ITA Premium, “Reduce Costs through Printer Consolidation: Tool”.

Involve departmental input to determine how each printer is used.


I quickly identified the need for only three types of devices: departmental networked color printers, departmental networked black and white printers, and personal printers that are locally connected. … We had so many printers all over the place… there was no standardization whatsoever.- VP of IT, Media & Entertainment

2.Assess the fleet requirements


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3.Assess the fleet costsDescription of

process:Determine the total cost of ownership of the printer fleet:

•Purchase price or lease expense of each device (whichever is applicable)•Cost of consumables: paper, ink, toner, etc. (if not included in lease agreements)•Depreciation expense (if applicable)•Cost of maintenance: per-call service, retainer service, on-site contracts, included in $/page contracts•Calculate downtime costs (# outages, loss of productivity, etc.) Use the ITA Premium “Downtime Cost Calculator”.•Overall $/page cost

Determine cost of external printing at third-party companies:•High-quality, color, bulk, etc. print jobs at print houses (i.e.: Kinko’s)

Estimate the total cost of printing.



Printers were [procured ]corporately … so [IT] didn’t know the true costs. ... Copiers had a lot more hidden costs. We had to look at contracts, invoices, consumables, and we looked at the GL under ‘Office Supplies’. … I didn’t realize so much color copying was being outsourced until we looked at the invoices.- VP of IT, Architecture

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How-to: Assign a IT FTE to track/monitor the costs of the printer fleet over a set time period (at least 3 months is recommended)Calculate the costs for each device (identified on previous slide) If devices do not have page counters, measure consumption costs by tracking paper, ink, or toner purchases through the Supplies departmentAnalyze help desk tickets or outage tracking systems to determine maintenance and downtime costs

Stakeholders: IT Director leads and oversees 1-2 IT staff or vendor tracks costs from each department and aggregates totalsAccounting/Supplies department provides purchase receipts from devices and consumables

Tool: Refer to tab, ‘3. Costs’ in the ITA Premium, “Reduce Costs through Printer Consolidation: Tool”.

Include the costs of supplies and paper.


All department costs were spread out. … Consolidating it made it look like costs went up a lot because costs were now aggregated, but the total was less than the previous totals.- VP of IT, Architecture

3.Assess the fleet costs


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4.Solicit end-user input


Understand end-user satisfaction with each device’s performance:•Quality of output•Ease of use•Speed of printing•Need for special features and its performance (print release functions, etc.)•Availability, frequency of downtime•Performance of service providers (maintenance time)

Understand why certain devices have low satisfaction scores. Determine the cause:•Insufficient user training•Overloaded device (output > duty cycles)•Lacking required features•Vendor does not provide adequate service

Involve the end-users in understanding particular requirements and concerns.



Customers’ reflection of what’s needed is different from the technical view.– IT Manager, Public Administration

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How-to: Create user satisfaction survey to gauge fleet performanceDistribute survey to all end-usersCollect surveys and compile results – take averages of scoresExamine devices that received low scores

Stakeholders: IT Director overseesOne IT staff member administers survey and compiles resultsFair sample size of end-users for each device to avoid bias

Tool: Survey sheets: refer to tabs 4a. through 4c. End-user Survey Analysis’ in “Reduce Costs through Printer Consolidation: Tool”.

A survey can be used to identify problem areas and validate findings so far.


It was the help-desk manager’s role to schedule quarterly calls with all department heads to assess their satisfaction with service. … We conducted this before and after roll-out to see what they liked/disliked about the printer changes.- VP of IT, Media & Entertainment

4.Solicit end-user input


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Identify opportunities for improvement to support the business case:1.Fleet requirements

•Scrutinize all desktops, standalones, or non-networked devices to determine need and potential to be eliminated•Compare utilization with duty cycles of devices within one department or within close proximity of each other to determine consolidation opportunities•Identify devices that can or should be eliminated due to their nearing end of life, or lacking application, platform, security requirements

2.Fleet costs•Identify cost-saving opportunities from eliminating all non-networked devices, desktop devices (i.e.: costly ink-jet printers)•Identify devices that are cost-inefficient (maintenance, supplies, downtime, etc.)•Consider cost-savings from standardizing device/supplies procurement, enforcing stricter printing policies (double-sided, monochrome settings), ceasing to print at third-party houses, reducing shrinkage of supplies

Identify which printers can be eliminated to estimate potential savings.


Align inventory with needs… Making decisions based on what’s needed and where.– IT Manager, Public Administration


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Identify opportunities for improvement to support the business case:3.End-user satisfaction

•Consider scores and responses from end-user satisfaction surveys and how relocation/consolidation/elimination of certain devices would impact user productivity and satisfaction•Note: End-user responses may be biased in order to keep their printers

4.Green benefits•Highlight the opportunity to reduce the organization’s environmental footprint through reduced use of consumables such as paper, ink, toner•Consolidating devices also reduces the use of electricity and the need to refresh a large printer fleet in the future thereby reducing hazardous waste

Consider end-user and ‘Green’ implications.


We’re a law firm so we generate a lots of paper. … [we’re] moving to electronic files, using the large [monitors] and we also enhanced our copiers so … hit a button and scan a document straight to your filing system. … we’ve been able to reduce the use of paper and ink and the environmental impact there that grows along with the increases in correspondence.- CIO, Law Firm


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How-to: Use the results from the previous four steps to identify areas for improvementCommission a third-party environmental auditor to measure impacts of printer fleet

Stakeholders: IT staff/team makes preliminary recommendations from findingsIT Director examines findings and makes overall recommendations to senior management

Tool: Refer to tab, ‘5. Opportunities’ in the “Reduce Costs through Printer Consolidation: Tool”.

Present cost-saving opportunities to executives to gain approval.


We looked at our service desk history to track which printers were more problematic and why …ended up retiring printers that were cheap to buy but costly to maintain versus getting slightly more costly but robust machines. … It was important to reduce unnecessary costs NOT to hurt flow of work.– CIO, Market Research


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Follow Info-Tech’s process roadmap to start realizing cost-savings.


Case Studies Table of Contents

* Source: Interviews with Info-Tech clients

Click on the ‘#’ or ‘Industry’ of a case study to view its contents: situation, opportunities, and results.


# Industry End-users Printer Consolidation Strategy Cost-savings

1 Public Healthcare

8,000 Eliminated 27% of fleet and replaced 90% of remaining devices with more

efficient ones

$450,000 (one-time)

$285,000 (annual)

2 Non-profit 150 Eliminated 46% of fleet based on utilization

$7,500+ (annual)

3 Media & Entertainment

1,300 Consolidated and standardized devices

50% reduction of $/page

4 Manufacturing 200 Eliminating all non-networked devices $40,000 (annual)

5 Architecture 3,800 Completely outsourced printing, implemented chargeback model

$10,000,000 (annual)

6 Technology Services

2,100 Consolidated and standardized devices

20% of TCO

7 Market Research

700 Outsourced to asset management vendor

TBD

8 Public Administration

500 Attrition of old devices TBD

9 Manufacturing 800 Consolidating into a new building TBD

Back to Deck

Situation:

• Printer vendor offered to uncover opportunity of PrC free of charge in exchange to be their sole provider for five years.

• Director of IT Support was interested in PrC since a shift to MFPs would allow for increased features and functionality.

Opportunity:

• IT Director realized 62% of the 1,095 fleet was not on the network which resulted in high consumption costs that were not being tracked – especially toner costs.

Results:

• Eliminating 93% of the fleet resulted in $450,000 cost-savings which was used to finance the leasing of 721 more efficient MFPs (79 devices were salvaged). Did not require a request for additional capital budget.

• 96% of 800 devices are now on the network except for 34 devices that are attached to clinical carts. This has resulted in annual savings of $285,000 from reduced consumables cost (mostly ink and toner) and maintenance costs since the lease contract charges $0.04/page and includes a 5-year warrantee. This has saved 1.4 IT FTE’s time which has been re-allocated to other projects.

• Printer vendor provides an on-site technician fully resourced to the hospitals; and, monthly usage reports which allows the IT Director to track costs, notify departments when normal usage rates are exceeded, and optimize the usage of the fleet by re-locating devices.

• All printer lease costs fall into IT’s budget and usage gets charged to each department at year-end. IT Director has set up strict printer policies, “If you are 50 feet within a printer, you’re not getting another one.”

• Key success factor was that the initiative was supported by senior executives. “The first person to get rid of their desktop inkjet was the CEO. All executives had desktops removed from their offices.”

Elimination Scenario:I need to switch to MFPs for features and functionality.


Industry Public Healthcare End-Users 8,000

Role CIO, IT Manager Savings $450,000 + $285,000 annually

Strategy: Eliminated a quarter of fleet and replaced remaining devices

Back to Deck

Situation:

• CTO was faced with challenge of reducing costs.• Chargeback model had already been in place for 10-15 years (IT charges departments $0.08/page

which includes ink/toner, maintenance, energy).

Opportunity:

• Identified the opportunity to reduce printer fleet of 35 printers/copiers by looking at monthly duty cycles and actual utilization rates.

• “Although those savings aren’t significant in normal times, it’s something, and it’s worth it right now.”• Eliminated 16 out of 35 devices based on their utilization, location in the building, and features.

Results:

• Resulted in $7500 - $9000 annual cost-savings from reduced use of consumables, repairs, and energy – it does not factor savings in IT support time from reduced helpdesk tickets.

• Printer TCO decreased 40% – 50% from approximately $18,000 in previous years.• Remaining 19 devices were recognized as necessary to support print volume in those departments

(not large enough to lease/purchase MFPs), but chargeback model keeps costs under control.• IT is responsible for tracking all printer/copier costs (except paper which is supplied by each

department).• Device requests must be approved by senior leaders and IT. IT then purchases one of the pre-

approved list of devices depending on feature requirements – typically mainstream HP devices.

Strategy: Eliminated almost half their printer fleet based on utilization


Consolidation Scenario: I need to get better utilization out of my printers.

Industry Not-for-Profit End-Users 150

Role IT Manager Savings $7,500-$9,000 annually

Situation:

• IT Director reviewed budget line by line as part of an initiative to reduce costs during tough economic times. Identified printer and toner usage as an area of opportunity to cut costs.

• Printer purchases are considered a capital item on IT budget, and consumables are considered ‘supplies expense’. However, IT was not tracking or controlling costs.

• Departments requested devices or supplies from IT and were granted them without approval needed. Printers were purchased as long as there was the budget, and bought models without concern for standardization.

Opportunity:

• IT Director realized that toner costs were out of control, and maintenance/support fees for printers were annual sunk-costs that could be reduced if printers were consolidated and standardized.

• Moved towards standardizing three types of devices: networked color printers, networked B&W printers, and desktop printers.

• Eliminated underutilized devices (reduced networked workgroup printers from 400 to 300, reduced desktops by 10%), and replaced inefficient older devices with standardized models.

Results:

• Savings were realized from eliminating devices reduced toner and support costs which financed purchase of new standardized models. Payback period of new printers was less than 1 year.

• Standardization allowed $/page to be reduced by more than 50% ($0.045 to $0.02) since better deals could be negotiated with printer, toner, and paper vendors.

• Stricter purchase approval process is now in place. Departmental managers are interviewed to justify need, and approval is granted by IT Director.

Strategy: Consolidated and standardized the printer fleet.


Standardization Scenario: My consumables costs are out of control.

Industry Media & Entertainment End-Users 1,300

Role VP of IT Savings $/page reduced by 50%

Back to Deck

Situation:

• Despite having 10-12 networked, high-speed MFPs spread evenly across the building, the IT Director discovered 70 out of 200 users had desktop printers.

• Furthermore, those 70 users were printing a total of 20,000 pages on the desktop printers despite an all-inclusive contract with a printer vendor that includes the cost of 70,000 printed pages (ink, toner, maintenance included).

• This resulted in wasted dollars from the underutilized page quota for the MFPs; as well as the costs incurred to purchase, supply, and support the desktop printers.

Opportunity:

• IT Director discovered a minimum of $40K in cost-saving opportunity by simply aggregating the costs associated with the non-networked desktop printers (ink, toner, maintenance).“Ink is too expensive for the desktop printers – that’s all you need to know. It’s a no brainer.”

• Need for stricter IT procurement approval policies. MFPs serve all end-users’ needs sufficiently, but employees are used to the entitlement of having printers on their desk. “They go out to the nearest Staples, buy a printer for under a hundred dollars, hook it up to their computers, and then expense it to their managers. We’ve locked down the administrative rights, but a coffee here and there [for IT] and eventually they get those printers hooked up.”

Results:

• Employees are being urged to go paperless by saving to SharePoint or imaging in other ways. Users are resistant to storing things on the network because of their fear of losing things.

• IT is overcoming end-user resistance by communicating cost-saving opportunity and by educating that documents get backed up on SharePoint with little risk of downtime.

Elimination Scenario:I have too many desktop printers in the workplace.


Industry Manufacturing End-Users 8,000

Role IT Director Savings $40,000 annually

Strategy: Eliminated all non-networked devices and enforce print policies

Back to Deck

Situation:

• Prior to outsourcing their printer environment, TCO for 900 printer devices was unknown because it was spread across all departments (insurance, taxes, maintenance, marketing).

• Printer and copier costs were massive due to the volume of printing being done for architectural projects. However, true costs were hidden since the supplies and devices themselves were purchased and expensed by each department head under a general office supplies account.

Opportunity:

• Consulting group identified printers as an area of opportunity within their overall organizational strategy for shared services. After totaling the costs from printer contracts, invoices for consumables, and invoices from outsourcing color copying across all departments, the organization realized a large opportunity for savings.

Results:

• IT decided to outsource their printing to a vendor (devices are still on-site) and implement a chargeback model.

• Each B&W copy costs $0.06, and is being charged to respective departments/projects that it is being printed for.

• Project managers are now responsible for tracking their printing costs. Almost 100% of these costs are recoverable since these fees are being charged directly to clients’ projects.

• Printer costs from all departments are now aggregated into one overall account. IT is responsible for monitoring this figure and putting reporting tools in place to track each department’s spend. Allows for accountability and comparability.

• Resulted in over $10M in savings since 65% of printing costs are now being charged to clients and the chargeback model has reduced unnecessary internal printing and color copies.

• Reduced printing TCO from almost half of IT budget to less than a third.

Outsource/Chargeback Scenario: I need to reduce costs from high volume and quality

needs.


Industry Architecture End-Users 3,800

Role VP of IT Savings $10 million annually

Strategy: Outsource printing and recover 65% through client chargeback

Back to Deck

Situation:

• Chief Administrative Officer introduced a strategic plan that outlined areas to reduce costs in light of tough economic times. Reducing printer costs was identified as one of these areas.

Opportunity:

• Sought to eliminate desktop printers and replace with MFPs to the extent that it didn’t negatively affect productivity. “It was important to reduce unnecessary costs - not to hurt flow of work.”

• Referred to service desk history to identify which printers were most problematic and why.• Resulted in retiring printers that were cheap to buy but costly to maintain.• Only devices needed in the fleet are Xerox MFPs (leased), HP ink-jets where absolutely necessary (due

to security requirements), and a handful of high-quality color printers for external documents.

Results:

• Consolidation and standardization to only two device types has resulted in cost-savings from bulk-purchasing of supplies, and less overall end-user printing. “We needed to break the thought pattern that having a printer on your desk is a right of passage. People are in the habit of printing in color every five minutes; but, if you make people walk to a printer, they print less.”

• Facilities Team tracks printer costs through supply orders and electronic device procurement system.• Procurement requests for desktops need managerial approval and will not be approved unless deemed

essential for workflow. IT will not support devices which are outside of the approved list. • Printer costs show up as a budget item on each department’s P/L statement, publicly viewable across

organization, and are reviewed by the executive team. “If costs are higher than expected, the executives will flag it. Managers don’t want to see highlighted cells when they get their statements back, so they have incentive to control it.”

Standardize & Track Scenario:I need to control printing without hurting workflow.


Industry Technology Services End-Users 2,100

Role IT Manager Savings To be determined

Strategy: Consolidated and standardized devices, shift edcost responsibility to department managers

Back to Deck

Situation:

• VP of IT Infrastructure has outsourced the process of uncovering their printer costs to an asset management software vendor. Offered as a free service to demonstrate software capabilities.

• Current printer fleet consists of workgroup printers shared by groups of users, desktop printers for 3-8% of end-users, and 1-3 copiers per office (34 offices).

• Not expecting huge cost-savings from eliminating desktop printers because strict procurement policies has controlled the number of desktops in environment. All purchases need to be approved by him and CIO.

Opportunity:

• Certain that there is a better way to configure the printer fleet to better serve end-user needs and match duty cycles with utilization rates. “I’m more concerned about the soft issues. What will happen if we move that printer there?”

• Opportunity to better track printing costs. Previously, IT and Facilities split the responsibility of tracking costs. IT owned/tracked printer costs (workgroups and desktops), and Facilities owned/tracked copier costs.

Results:

• All cost-tracking responsibility has shifted to IT to allow for better management of fleet.• Vendor is monitoring fleet for 60 days (on-going). If report findings reveal a reasonable return, they

will purchase software and go ahead with recommendations.• ‘Reasonable’ ROI depends on #FTE required to implement initiative. Given their limited number of IT

staff (17 people), must weigh available resources with cost-saving opportunity of project.

Vendor Consulting Scenario:I don’t have the resources to uncover my print costs.


Industry Market Research End-Users 700

Role CIO Savings To be determined

Strategy: Outsourced to asset management vendor

Situation:

• Organization rents 10 MFPs with a $/page that is charged back to respective departments.• However, 80 desktop printers that are not connected to the network exist in the printer environment.

Costs associated with these desktops were unknown since each department purchased their own supplies which got rolled up into general expenses.

• Equipment acquisition approval process is in place, but a lack of executive-level support has resulted in a growing number of desktop printers that get approved. IS has no choice but to purchase and provide support to these devices.

Opportunity:

• IS department is planning to eliminate at least 50% of these desktops through attrition – a passive strategy to reduce unnecessary printing, and costs of consumables, electricity, and maintenance.

Results:

• Currently consolidating, but doubtful of success due to low executive buy-in, and cost-savings may be minimal.

• IT Manager realizes the importance of stakeholder buy-in at all levels driven by the cost-saving opportunity. “Even though every dollar counts, $5000 a year [in cost savings] is not impressive. It needs to be ranked important by Accounting and other leaders.”

• Although cost-savings have not yet been realized, help-desk tickets have gone down and there are direct savings with each desktop that is eliminated from the environment.

Passive Attrition Scenario: I want to consolidate but have limited support from

execs.


Industry Public Administration End-Users 500

Role IT Director Savings To be determined

Strategy: Attrition, due to low executive buy-in

Back to Deck

Situation:

• Organization is looking to eliminate two office sites and move into a newly built, more efficient office building.

• CIO is looking to consolidate and reduce their printer fleet from the two offices as part of the larger initiative to move into the new office. He is attempting to reduce the costs of consumables and maintenance.

• Currently, there is no purchase approval process. Devices are expensed by end-users, by-passing IT, but then considered capital investments under IT’s budget.

• Consumables are captured as 'Computer Supplies' under Office Services department budget. Supplies are ordered in bulk according to regular usage patterns, and users go to supply closet when they need it and there is no control. “I’m not comfortable saying, ‘No, you can’t print that,’ if it’s necessary for their job.”

Opportunity:

• Gradually phase out some of the 35 desktops and 33 workgroups as they reach their end of life, and strategically spread out the remaining devices in the new office.

• Placement of remaining devices will be determined by matching utilization with capacity.• CIO is putting purchase policy in place: all hardware will require a PO that must go through IT using

an electronic purchase requisition system. POs will be approved by CIO, if over $10K then CFO, if over $20K then CEO.

• Looking to acquire print software to monitor/track printer costs. Will help make the business case for management.

• Looking at aggregate costs of supplies will convey a more convincing message to leadership team.

Results:

• Pilot will be considered successful if projected cost-savings across all seven locations would yield at least $20-50K.

• Cost-savings realized are still to be determined.

Spacing Scenario: I need to reduce the amount of space occupied by

printers.


Industry Manufacturing End-Users 800

Role IT Director Savings To be determined

Strategy: Piloting PrC in two office sites that are set to move into a new office building.

reduce costs through printer consolidation

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