MPS in South Africa, looking back at 2010
At the start of 2010 we published an issue of the MPS Insights Journal looking back at 2009 and what MPS had done around the world. So, we followed up with a few of our contributors to see how the market had changed since that time. Over the next week we’ll here from contributors in South Africa, India and Australia.
Jannes du Plooy, CEO, Solution WorX
In 2009 I attended the first European conference on MPS in Amsterdam. Everyone was discussing MPS and stating their leadership “status” in the industry – everyone had a so-called “MPS strategy.” I felt a bit despondent as I was under the impression that Solution WorX was the leader, having been in the industry since 2002, focusing exclusively on MPS.
During 2010 more companies came on board announcing that they are now specializing in MPS. Some even claimed to be the biggest in their respective markets – even though they had not yet closed one single deal. ICT companies came on board, hardware vendors and consulting businesses announced joint ventures that would transform the industry and hardware vendors collaborated with other brands, enabling them to service the market.
After evaluating all of the talk and hype, I soon realized that restructuring your business and ring fencing your printer service and maintenance business does not automatically make you a leader in your market, despite your PR efforts. Having a strategy means very little. Implementing your strategy is far more compelling and challenging.
Hardware vendors are declared leaders in MPS, featuring in all sorts of quadrants because they rename their “all-in lease” or “pay-per-print” contracts (that excludes many items relating to printing) as MPS. Even the so-called “Office Automation craze” of the late 90s (a thoughtless like-for-like replacement with a newer model) got a spot on the “Bulldog with Lipstick Top Ten Hit Parade of Renaming My Contracts as MPS.” This is not MPS and during 2010 it became apparent that customers are much more informed about what they want and what the market is actually disguising as “MPS.” Customers finally realized: “If you do what you did, you get what you’ve got!”
Case in point: A large financial services organization in South Africa issued an RFP inviting mainly the traditional “bulldogs” to take part in what appeared to be a hybrid MPS requirement. The RFP still had a strong focus on hardware, as the client did not really understand its own cost.
After evaluating all the tenders and presentations by the various vendors and service providers (which included Solution WorX), the client withdrew the RFP and indicated that they first needed to understand where they are (their own cost, etc.) before embarking on a way forward. Knowing your own cost and asset base is the basic fundamental for the successful implementation of any MPS strategy. They were fortunate to admit that their initial approach was not holistic and they are in the process of determining where they stand – a great example of how customers are starting to realize they have been, and still are in many cases, being taken for a ride in an old car with a new paint job and license plates.
During one of the break-out sessions at the 2010 MPS Conference in Barcelona, David Cameron, a Photizo Group representative, asked a very relevant question. He wanted the group to share how they deal with no minimum billing and financing in their MPS assignments / contracts / projects. The blank expressions and the subsequent responses by two or three of the larger vendors revealed that they have not dealt with such issues before because their solutions do not address the subject, making it crystal clear to me that the market still has a ways to go when shifting from renaming old existing offerings to getting to the No Print, No Pay© all inclusive managed service – the so-called “limousine service” that MPS is really all about.
In South Africa, two listed ICT companies have indicated that they are pursuing MPS aggressively. The one, in partnership with Solution WorX, have submitted a number of proposals to large- and medium-sized clients, and recently we secured our first win as a JV (no announcement yet, as we’re still in the negotiating / contractual phase).
In 2010 we saw a distinct trend where customers of traditional vendors were moving away to a solution where they are interested in a complete service and not a “box drop” with a small service element.
I believe that this will become the norm – the days of uninformed customers that can be duped into anything are over. The MPS hype created by traditional vendors has had one distinct result: End-users are finally asking the right questions and demands a full service. If you do not adapt to it, a “new paint job” will no longer help!
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