Q&A: HP's Bill DeLacy on giving customers their money back

Bill DeLacy: Printing is now an issue of strategic importance

HP has used its acquisition of EDS to launch a new global managed print service for enterprises this week. V3.co.uk sat down with Bill DeLacy, HP's general manager, EMEA, Imaging and Printing Group, at the launch event in Berlin to dicuss the wider implications of the printing strategy, the firm's alliance with Canon, and the thinking behind the new high street-style money-back guarantee.

V3.co.uk: You've bought a lot of companies over recent years. Why do you still need a partnership with Canon?

Bill DeLacy: We’ve worked with Canon for a number of years. Last year we finalised our arrangement, as it became increasingly apparent that enterprises wanted a better service. Yes, we have bought a lot of companies. In the past 12 months we've acquired 32 different software companies as we systematically acquired the pieces to fill out our product portfolio.

The acquisition of EDS gave us the services capability. But at the high end, we still lack some products that are needed for high-end document management. Canon's S5 and S6 models, for example, give the customer a finishing service we can't match at the moment. Massive documents can be automatically sorted, and bound and stapled and presented with the best professional finish possible. By filling in the gaps in our portfolio, we've got a complete line-up of products from graphics production down to the desktop. There's no engagement too large or too complex for us to meet now.

Your Printing Payback Guarantee, which offers customers money back if projected print services cost savings are not obtained, sounds a bit 'high street'. That aside, isn't it a bit risky?

It is a bold statement, but we're confident we can deliver the cost savings we promise. I don't think we're making any financial reserves, in the event of emergencies. It's pretty low risk for us. We've created the savings for a couple of enterprise customers, Barclays Wealth and Swisspost, and 100 companies in the US have signed up.

Besides, this is about taking the risk away for the customer. The cost of managing printers is getting out of control for many big corporations. They spend six per cent of their revenue on printing and document management. This is a pain for many chief information officers, and we can make it go away. In the current climate, how many ways are there to automatically slash six per cent off your overheads? This is a massive opportunity for HP and its partners to solve a big problem for CIOs. Companies want a supplier that can mitigate the risk for them.

Isn't a managed print service a bit like outsourcing? Analysts say the problem with outsourcing is that the service level agreements are hard to enforce, as companies change so much; and the legal contracts are too nebulous.

Yes, contracts were hard to enforce in outsourcing, because companies are all subject to change and restructuring. Look at us, we just set up a new division. But we're used to dealing with that, and with EDS we have the breadth of experience in dealing with change. The money-back guarantee has been planned in great detail. We can cater for any eventuality.

What's happening to the printer market? How is HP adapting?

A printer has always been a commodity product. The customer bought it, and the vendor's involvement with them ended there. HP has always been great at supplying printers, but we weren't great at toner fulfilment, or devising per-click packages or service management.

Managing printers has become more of an issue. For every dollar spent on products, nine are being spent on managing the devices and the paperwork. We didn't really have the services offering, until now. Printers and consumables were a commodity purchase, but the service they deliver to the company - the management of information and workflows - are of much greater importance. The management of print services will give rise to document management, which in turn will evolve into workflow management. And that is an issue of strategic importance.