Printing majors enter outsourcing domain

Escalating printing costs and lack of understanding of technologies are forcing firms to look for alternative solutions to cut costs in document production.

While IDC estimates that companies spend up to 10 per cent of their revenues on document production, management and distribution, analysts peg the typical return on investment (ROI) by outsourcing print management to vendors is in the range of 30 per cent across sectors.

Traditional printing vendors such as Xerox, HP, Canon and WeP Peripherals are offering services that allow organisations to outsource their printing requirements. Xerox India, for instance, has launched a service line called document outsourcing and communication services (DOCS), targetting BFSI (banking, finance, services and insurance), manufacturing, retail and advertising sectors. The service, offered by Xerox Global Services, provides consulting and managed services to optimise costs.

"DOCS enables enterprises to manage costs and increase returns by about 20 per cent. Designed by Xerox to improve customer acquisition and loyalty, DOCS aims to raise productivity levels by 40 per cent," Ravi Venkatraman, director, Xerox Global Services, said.

While printing devices are often owned by customers, the vendors today are bundling the product with services and sometimes luring businesses by offering a suite of consulting services. Hewlett-Packard (HP) has gone a step ahead with a contractual model for its multi-function printers based on the Edgeline Technology. Under this, printers at the customers' premises will actually be owned by HP.

"We target high-volume users. They need not pay for it. It's a pay-per-use-system, where the devices, services and consumables like ink and print head will be taken care of by HP," said Samir Shah, country manager, commercial and enterprise printing, Imaging and Printing Group (IPG), HP.

The company offers managed print services, wherein a customer can outsource his document management works, including copying, printing and faxing to HP.

Bangalore-based WeP Peripherals has a print outsourcing model called print and save services in India. The company claims to have over 1,000 customers in 670 locations. It's little surprise, then, that the document solution market for the Asia Pacific region is said to be around $94.3 billion.

Customers are also finding sense in leveraging the services and technical expertise of printing vendors by outsourcing printing. The Wockhardt Hospitals in Bangalore said by outsourcing printing, they were able to concentrate more on core areas.

"Apart from costs, we are able to utilise our manpower more effectively in productive activities. Now it's very simple as we send documents in simple format and they deliver in 2-3 hours," says Vijay Rathna, manager, medical services, Wockhardt Hospitals, Bangalore. Wockhardt Hospitals has outsourced its document management works to WeP Peripherals.

UTI Bank, Mumbai, which prints about 30 lakh impressions every month, outsourced its print operations to Xerox almost three years ago. Salil Krishna, senior vice-president, design, UTI Bank, said that with centralised printing, the bank reduced printing and mailing of cheques from front office. Globally, Xerox claims to have 10,000 live contracts, with the Karnataka High Court and Bharti Airtel being some of its customers in India.

Venkataraman said looking at the nature of the printing materials, Xerox offers a service called Document Advisory Office, wherein a customer can get the printed documents delivered by Xerox Global Service on a real-time basis.

Incidentally, while managing IT infrastructure has become a cause of concern for many non-IT companies, most printing solution providers are introducing consulting services. HP has trebled the number of its consultants within the IPG in the last nine months. "Our aim is to position ourselves as a complete content management services provider leveraging the expertise of our Technology Service Group, which takes care of the server business within HP," said Kelly Tan, vice-president, Enterprise and Specialty Printing, IPG Asia Pacific, Japan. Xerox claims to have over 15,000 consultants worldwide. Globally, one-third of our revenue came from service, said Venkataraman.

Canon India has also announced its decision to provide holistic services including hardware, software, manpower, training, consumable, services as well as paper. Currently, Canon India provides document management contract services. Canon, as part of its reorganisation, has appointed a colour specialist under the business imaging solutions channel. The colour specialist will provide expert advice and guidance to customers.