Outsourcing strategies to suit needs

For companies that have at least 10 machines or more - and that includes all types of equipment - there is always the option to outsource the management of those assets.

Insourcing has been the main way of handling the maintenance, servicing and overall control of the office equipment assets, and it is usually assigned to the IT staff to keep everything running and just call in the outside service provider - usually a vendor - whenever major repairs are needed. The IT staff will then attend to software and user support within the company.

This makes sense in many ways, because the equipment - whether printers, copiers, scanners, MFPs or a variety of all of those - is seen as just a range of peripherals that are part of the general IT infrastructure.

The problems that come up are twofold. Firstly, when there are many devices to manage, this can put a considerable burden on the IT staff. Secondly, the more advanced equipment we see in the market these days needs specialised support - not just to keep it running efficiently, but also to generate maximum value for the business from those equipment investments.

Whatever type of support agreement a company has with its service provider, the actual support call-outs involved will fall into two categories: hardware support or software support. What we are seeing now is that software support calls are becoming the more important of the two, which is a clear indication of the levels of sophistication in the equipment and the expertise needed to look after it.

Rather than place this overhead on the IT staff, who may well have other core responsibilities that should be prioritised, companies are looking at outsourcing models where the equipment management is given over to the service provider.

A basic outsourcing model would be a contract that covers the rental of the equipment, a cost per click for its usage and then additional charges for support calls on top of that.

What is proving more popular is a model in which the customer pays for a fixed amount of usage - based on average volumes - and that price per copy includes support.

The general trend is for larger companies to outsource just about all their equipment to a single service provider. This happens even in situations where there is a mix of different vendors' products in the infrastructure.

The general trend is for larger companies to outsource just about all their equipment to a single service provider. This happens even in situations where there is a mix of different vendors' products in the infrastructure.

Michael Powell is product marketing manager at Kyocera Mita South Africa.

The service provider then is a one-stop shop for handling all equipment issues and a single point of contact from both a management and accounting viewpoint. While this makes life a lot easier for the customer, it does increase risk - it's a matter of putting all your eggs in one basket. Consequently, the service level agreements around such contracts are usually quite stringent.

While customers in the middle tier of the market will have contracts in place with vendors, the enterprise-level customers will typically deal with the manufacturer - either the local office or even the overseas head office.

For any business, no matter what its size, the real issue is not just cost, but also service delivery. You can be getting a really good price per click for each individual document printed, but that doesn't mean much if the machine stops working and you don't get rapid support to get it back up and running.

As with any type of solution, an outsourcing model and the contractual arrangements that support it have to be customised to meet the specific needs of the customer.

For the larger SMEs, the priority is reducing the burden on what is probably quite a small IT staff and saving costs. The larger business will focus more on costs - the savings achievable on 100 or more machines are quite considerable. For any business, service and support are critical concerns, which is why the largest customers will require direct contact with the manufacturer.

While a vendor or service provider, being an approved dealer with its own expertise and good support from the manufacturer, can provide the same quality of service, it is simply a matter of scale for the enterprise customer. Maintaining 100 or 1 000 machines is obviously more demanding than looking after 10.

The primary attraction of outsourcing is financial. The contract can be structured so the customer has no capital outlay and their cashflow is not diverted into equipment assets that are, inevitably, depreciating in their intrinsic value.

What customers need to realise, however, is that a well-planned outsourcing arrangement has many other benefits in terms of saving costs and freeing up skilled staff within the company, who can be more productively employed to attend to other issues, rather than spend significant amounts of time on equipment support.

* Michael Powell is product marketing manager at Kyocera Mita South Africa.