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Printer maker Lexmark provides managed printing and output solutions. “For many years, Lexmark has been helping organisations develop output strategies of which printer fleet management is an integral component,” a Lexmark spokesperson says.

“In Australia and New Zealand, organisations have been using a managed print service (MPS) to control the ongoing costs of a distributed fleet, to drive down costs to improve their bottom line.”

Lexmark says the MPS market has been estimated as growing at 25 percent a year.

Lexmark’s “distributed fleet management” MPS has resulted in 20 deals with some of Australasia’s larger companies. “Lexmark and its partners have 40,000 devices under maintenance and management contracts,” the spokesperson says.

Printing is growing, while copying and faxing -- and possibly scanning too -- are in decline.

Organisations, however, are continuing with their large fleets of devices, which must be configured and deployed according to actual work practices.
 
That opens up a chance for the MSP, the Lexmark spokesperson says.
 
Managed services are a form of outsourcing -- a go-to-market strategy that has copped rather a lot of flak. Gartner has predicted that, by 2008, 70 percent of all outsourcing deals will face serious problems that could cut the contracts short. Ten percent will break down completely. Only half will persevere with a solution.
 
Linda Cohen, a US-based managing vice-president at Gartner, says the main causes of failure include a “not-strategic” approach to problems, a lack of innovation or atrophied IT environment, blame-shifting, customer dissatisfaction with price or results and bad management.

Providers should watch for “deal paralysis”, she says. That is a situation where unpredictable deal costs lead to unpredictable service and delivery models. Also, vendor “tunnel vision” can lead to poor internal or external collaboration between service providers.
 
The picture can be bleak, she says, but many problems are avoidable and even reversible.
 
Cohen’s prescription is to ensure the “right people and the right processes” are in place, guaranteeing a disciplined approach to multi-sourced service provision. Providers must also clearly articulate how the service meets defined business goals and strictly adhere to a management and governance model.
 
“The third stage involves choosing the right deal to achieve the desired outcome based on an efficiency, enhancement or transformation model,” Cohen says. “Should this be a customised deal, or a standard one?”
 
David Blackman, national VAR sales manager at Symantec Australia, has some very specific tips for selling managed security services.
 
Resellers must make sure they team up with the right vendors. A vendor with offerings across various platforms and who specialises in managed security services might be best, he suggests.
 
“By only supporting one vendor’s platform you will be missing out on incremental revenue opportunities,” Blackman says.
 
Mid-market customers are stretched when it comes to their resources. But he says it is a big mistake to pitch on price. “You need to confidently be able to describe the true value-add. Managed security service costs are not inexpensive,” he says. “Pitch the benefits of outsourcing.”
 
Managed service providers should offer options on pricing, such as longer term contracts, tiered pricing offerings that can be matched with IT spend, or monthly payment programs, he says.
 
“[But] beware of long sale cycles. Forecast sales well in advance,” he says.
 
Resellers should also seek out verticals where regulatory pressures have intensified, and target them. Managed security, for example, can help organisations protect their information assets, Blackman says.
 
According to analyst Frost & Sullivan, Cybertrust is leading the Australian managed security service market with 25.5 percent market share. The global company has done well in Australian government deals, specialising in managed authentication and public key infrastructure services.
 
“By combining the right mix of people, processes and products, Cybertrust has taken the lead not only in Australia, but around the world,” says Paul O’Rourke, Asia-Pacific general manager at Cybertrust.
 
John Mobbs, chief executive at criminal records specialist CrimTrac, said Cybertrust secured its internet, email and web hosting services via a DSD-certified gateway. “We also use Cybertrust’s VPN service to provide secure remote access for key staff and it is a major enhancement to the way we previously struggled with this capability,” Mobbs says.