Well, the news isn't getting any better, I'm afraid. The U.S. Postal Service ended the first three months of its 2012 fiscal year (Oct. 1 – Dec. 31, 2011) with a net loss of $3.3 billion. Management expects large losses to continue until the Postal Service has implemented its network re-design and down-sizing and has restructured its healthcare program. Additionally, the return to financial stability requires legislation which gives the Postal Service typical commercial freedoms, including delivery flexibility, returns over $10 billion of amounts overpaid to the Federal Government, and resolves the need to prefund retiree healthcare at rates not assessed by any other entity in the United States.

Stronger than expected holiday shipping activity, driven by strong growth in online merchandise sales and successful USPS marketing efforts, helped the Postal Service grow its competitive Shipping Services business in the first quarter, with revenue totaling $2.8 billion, an increase of $179 million or 7 percent over the same period last year. However, declines in First-Class and Standard Mail of $650 million were 3.7% percent of total revenue and greatly exceed the gains made in the package business. First-Class Mail declines due to electronic migration of transactions are expected to continue for the foreseeable future.

Mailing Services revenue, excluding First-Class Mail parcels, totaled $14.5 billion, a decrease of 2.9 percent. First-Class Mail continued to decline, with revenue decreasing 4.1 percent compared to the same period last year. First-Class Mail revenue has declined nearly 15 percent and volume has declined 25 percent since volume peaked in 2006. While some of the decline is attributable to economic weakness since 2007, the more significant factor is the continuing transition to electronic alternatives.

And there's the rub – the continued transition to electronic alternatives. Doc is afraid the news for the USPS is only going to get worse, though they may, with appropriate cuts, be able to stop some of the heaviest bleeding. But we have to decide how valuable mail service is to America and pony up the money or be willing to spend more on postage rates. There is no easy solution.

If there was one clear lesson from the 2012 Lyra MPS Forum, an "add-on" half-day conference held in conjunction with the 2012 Lyra Symposium, it was that the managed print services (MPS) business is getting tougher. The easy part—selling printing and copier savings to corporations—has gotten more competitive, and perhaps even has become a "commodity," according to Lyra analyst Robert Palmer.

As a result, MPS vendors are searching for new sources of profit such as small to medium-sized businesses (SMBs), global accounts, or more service-intensive accounts. But in all cases, servicing such customers is more difficult than it used to be. SMBs are too small to be serviced by an OEM's direct sales and service forces, so vendors instead must rely on dealers, primarily copier dealers. But copier dealers have a box-moving mentality that is ill-suited to a service business.

Global accounts are even more difficult to deal with because a vendor must have a presence in every location where their customer has an office. Sharron Lawson of PrintFleet told the story of an MPS vendor who belatedly learned that a new customer had an office on Baffin Island, a remote frozen wasteland in the vicinity of the North Pole that requires hours to reach by air, and that's if the weather is good. By the time it was discovered, it was too late to change a clause in the contract calling for a $100 fine every time the toner runs out.

You can read the entire blog from Charles here.

There's a services model sea change going on, and most are either wanting to get there in the future or trying to master it now. While there's no "easy button" for changing from a hardware-focused business to a service-centric model, there are good reasons to evolve in that direction and better resources today than ever before to make it less painful.

According to our GreatAmerica Annual Dealer Study, 59 percent of respondents have implemented an MPS strategy within their business, up about 7 percent from last year. MPS was also hands down the most highly mentioned "most significant opportunity" for the coming year among our dealer respondents. Of those that have not yet implemented MPS, more than 50 percent of them plan to enter the MPS market within the next year or so. But where will they start? And who will help them get there?

Many in our industry have embraced Photizo's Expanded Customer Adoption Model. When looking at Photizo's four stages – 1) control the print environment, 2) optimize it, 3) enhance it and 4) converge other managed services into the equation – you can see that a different mentality is required of dealers to be successful today. Rather than going in and getting that MFP replaced, dealers have to think more holistically about their customer's business and engage at a more strategic level.

It is also important to consider that in these changing times, businesses must do what they can to protect their market share. Under ideal circumstances when selling MPS, you'd simply go in and refresh a customer's fleet from the get-go, but with so many other companies calling on your customers (paper companies/toner companies/VARs, etc.), it's not that simple. It may now make more sense to go in and apply the "land grab" approach before someone else does. But a "land grab" (going in and protecting your relationship with your customer by getting all service and supplies under contract) requires a consultative sell.

Jennie has more, and concludes that getting into MPS may not be simple, but is easier now than ever before.

Well, now to help solve customer challenges, FedEx Office is accelerating investment in its infrastructure by adding additional high-end, commercial production equipment. The company is deploying new grand-format inkjet printing devices to its centralized production centers across the country for producing rigid signs, banners, posters, point of purchase materials, oversized prints and more. Also, it is expanding its experienced workforce by hiring more team members.

FedEx Office was recently awarded a four-year contract from Boeing, the world's largest aerospace company and leading manufacturer of commercial jetliners and defense, space, and security systems. Effective March 1, FedEx Office will serve as Boeing's primary print provider, producing critical operations, sales, and large/grand format printed materials.

Since May 2010, FedEx Office has deployed nearly 8,000 new printing devices to its U.S. and Canada locations and recently installed new automated finishing equipment at its offset printing facility. The company will leverage this technology to produce a variety of signage and over-sized prints for various customers, from big box retailers with multiple locations across the country to large corporations and small businesses.

Doc finds it interesting that some larger companies are starting to outsource to FedEx Office, which typically had dealt with smaller, local businesses. Could be an important new trend in the print-on-demand market.

There is a misplaced trust in the forecasting process as some kind of physical science when forecasting is really barely an art. The reasons executives want forecasts is that they are seeking some kind of number to calibrate their expectations so they can allocate their resources accordingly. But, this has never been enough for managers to have. It's been enough to justify a forecast or a budget for approval, but it's not really enough.

What managers really need is a collection of multiple future scenarios that they evaluate often. Forecasting is best used as a strategic tool that is constantly raises questions. Even though it involves statistical data, forecasting is a qualitative process, not a quantitative one. The fact that numbers are involved in forecasting gives an illusion of precision that can mislead managerial decision-making.

Economic forecasts are built on foundation that looks backwards. All economic forecasts have a degree of historical extrapolation based on previous market conditions that may no longer exist in the future.

Joe goes on to use his own methodology to forecast the next few years in the commercial printing industry and comes up with some surprising results. Well worth a look, complete with great charts. Check it out here.

Technology is not THE answer. I guess I'm paraphrasing Nicholas G. Carr who wrote the now famous Harvard Business Review article titled IT Doesn't Matter back in May 2003.

Within the context of the print industry, technology isn't the answer either. Technology is a potential component of the answer. It's almost as if technology has risen to the level of religion, unlimited potential based on faith.

Again and again I hear the words, "we just need to buy technology that can enable us to sell this online and then poof we'll go from $X to $XX,XXX,XXX overnight. Or a less dramatic example, if we had a management information system (MIS) we could control waste, manage labor, and cut our costs. Do you see how these statements are making technology the answer?

Yes, technology can make an impact, but the real difference is always about the strategy and people using the technology, not the technology itself. I've witnessed different print organizations buy the exact same product, from the exact same vendor, target the exact same market, and get wildly different results.

What's the difference?

The three most common differences I see between the successful companies and the not so successful companies are: 1) Strategy 2) Focus 3) Execution

Author Jennifer Matt goes into a lot more detail on each of those three differences. Doc says to check it out.

This point and many other good ones, are made in an article I ran across recently from Tracey Rothenberger writing at IT Business Edge.

Anyone who has implemented a significant business process transformation, such as consolidating different ERP systems after a merger, knows that success depends on many factors beyond IT. A successful transformation must include the motivation and empowerment of diverse stakeholders at all levels within the organization.

This is especially true when the desired process transformation involves established business-critical document processes. Core Line of Business (LoB) processes, such as sales, finance/accounting, operations, customer service, HR and others, incorporate document information to such a degree, so integral to the way they perform their functions, that transforming these processes can seem insurmountable.

C-Level Communication Is Key

At the highest level, it is vital that C-level executives do more than "buy into" the transformation. It is imperative they establish and continue to communicate the link between top corporate goals and the business process transformation everyone is expected to support.

For example, if senior management's goal is to establish a more customer-centric focus, it must be made clear why the proposed change in business-critical document processes is fundamental to better customer service. Faster, more accurate response to inquiries ensures that prospects are more likely to become customers and customers will increase their investment.

Tracey has a lot more to say, and the article is well worth a look.

Now new figures from a study sponsored by Ricoh show that, by 2020, the impact of new technology in the workplace will force businesses into a new era of decentralization. The research, conducted by the Economist Intelligence unit, shows that 63 percent of business leaders predict a shift towards a more decentralized business model and that responsibility for business decision making will move from centralized management boards towards individual employees.

In the past, decentralized structures were generally criticized for their inefficiency, duplication, and lack of consistent strategic direction. By 2020, effective business processes will empower workers to better meet the needs of the market place and enable organizations to be more agile.

At the heart of successful decentralization in 2020, lies a network of integrated processes to manage information, and ensure that it is accessible by key knowledge workers, wherever they are, to make business decisions. In the future, there will also be a need to consider how experts outside the organization can input and retrieve information to act on behalf of the business. Eighty-five percent of business leaders agree that project teams will typically include members from outside the organization (for example, customers, partners, and communities).

To download the Executive summary visit here.

The Australia and New Zealand (ANZ) ICT infrastructure market will be characterized by changing investment priorities due to economic conditions, according to the latest predictions from IDC Australia.

IDC Australian senior analyst, Trevor Clarke, said in a statement that while the Australian market is resilient to the economic woes of other regions, it is not immune and companies are likely to hedge their bets when investing in ICT infrastructure this year.

The following represents the top 4 key ANZ infrastructure predictions from IDC for 2012:

1. Android smartphones will take over Apple iOS in 2012

2012 will set the stage for an intense client operating system (OS) battle for smartphones.

2. Apple iPad will maintain its dominance in the media tablets market

Apple will hold the number one spot despite Android growing at a faster rate of 36.2 per cent year-over-year (YOY) with iOS tailing at 8.8 per cent YOY growth.

3. Windows 8 will help the PC market stay resilient in 2012 and beyond

The release of Windows 8 in the second half of 2012 will set in motion the extension of personal computing beyond conventional platforms and form factors while also fueling enterprise mobility.

4. 2012 will be the year channel partners take managed print services to the SMB market

Channel partners will increase the penetration of Managed Print Service (MPS) in small and medium-sized businesses (SMB). IDC expects MPS revenue to increase by 15 per cent in 2012.

For the remaining top ten, see the full article from Computerworld.

"Green Printing" is beyond being a buzzword,” said Don. “It has become a clich. Sustainable Print is the trope that is gaining traction and becoming a reality because of the rigor and vigor being applied to sustainable supply chain metrics by major retail and consumer goods brands participating in initiatives like the Sustainability Consortium.”

This gives Doc a good chance to promote the Sustainability Consortium, which is a non-profit organization of diverse global participants working to make the world more sustainable through better products, services and consumption. The group develops and promotes science and integrated tools so that together they can improve informed decision making for product sustainability throughout the entire product lifecycle across all relevant consumer goods sectors.

The Consortium's vision is to advance science to drive a new generation of innovative products and supply networks that address environmental, social, and economic imperatives. Through multi-stakeholder collaboration, its mission is to design and implement credible, transparent and scalable science-based measurement and reporting systems accessible for all producers, retailers, and users of consumer products.

Despite a slight decline in year-on-year shipments of 2.6% to 8.1 million, the outlook remains optimistic for growth but margins for suppliers remain constrained, according to the Western European Quarterly Hardcopy Peripherals Tracker from a decline in revenues of 10.7% to $3.3 billion from $3.8 billion in 4Q10.

Commenting on these headline numbers, Arnaud Gagneux, director of IDC's Western European Imaging Hardware Devices and Document Solutions group, said, "2012 will be a key year for manufacturers and their channel partners. In the current economic climate consumers are turning away from printing at home while businesses are making sure that they can benefit from all the new features the latest MFPs and printers can offer. Documents are being digitized and workflows streamlined in an attempt by businesses to drive costs out of the business and increase efficiencies."

Phil Sargeant, IDC research manager, said demand for hardcopy devices in the business environment remained strong as combined business inkjet and laser shipments grew 3.1%. In line with current market trends, color devices showed solid growth of 8.4% but monochrome contracted 6.4% and this resulted in an overall reduction in the laser market of 2.1%, which is in line with the overall market decline. Monochrome remains twice the size of the color market, but the gap between the two is narrowing and both monochrome and color devices are beginning to feel some pressure from business inkjet products in the SOHO and small business sectors.

Bright spots for 4Q11 included the continued growth in business inkjets (32.4%), increased installations of color devices (8.4%), and continued strong demand for high-speed inkjet devices (13.6%).

Disappointments included a decline in the consumer inkjet market of 5.1% in the busy Christmas period and a decline in the monochrome printer market of 12.0% in 4Q, which is traditionally a strong market for monochrome devices.

For more on the report, check out the IDC website.

A while back, I wrote about the Espresso digital book printing device, which allows bookstores to print back-list book titles on-demand based on consumer requests. This allows stores to “stock” a much bigger inventory than if they had to actually put the physical books on the shelf. Some see this technology as a possible edge against e-books, which are also available on-demand.

This got me to thinking about the very definition of a “book.” Clearly, we agree that a printed volume is aptly called a “book,” and it really doesn't matter if it's printed on site or at a central location. But what happens when we add in features to traditional books that are only possible when viewing the work on digital devices such as the iPad or Kindle? When you add video, interactivity, links and other digital features, the nature of the work changes considerably, and the electronic version is no longer directly comparable to the print version.

People get hung up these days on comparing the value of a print edition with that of an electronic one, and for some titles, the differences are not all that great. But we're really talking about two completely different products and different reading experiences, so the comparisons may not be appropriate.

I'm a firm believer that both products will continue to survive, though I certainly see the market shifting more and more toward electronic “books” or whatever we might call them. One company which producers expanded e-book titles refers to them as “Vooks,” presumably the combination of video and book.

Is it time for a new term for e-books? Or do we continue to lump both print and electronic versions of published works into the same category, even though they are becoming two different beasts? Doc would like to hear your suggestions for a new term to describe the multi-media products we now are calling e-books.

Blackstreet typically purchases under-performing companies. But according to the company, AlphaGraphics is profitable and does not fall into this category. The franchise company has weathered some difficult economic times.

AlphaGraphics business centers offer a complete range of print, visual communications and marketing products and solutions, including full-service digital, offset and large format printing; design services; mailing and one-to-one marketing services; promotional products and digital archiving.

Doc will be paying attention to see what happens next – private equity buyers are usually in for the short term, looking to maximize profits and cut costs so they can re-sell at a profit. AlphaGraphics has done a good job of diversifying its product offerings, but it's still primarily a printing operation, and that seems a little scary in this era.

Most of those surveyed also believe that paper records are more sustainable than electronic record storage (68 percent) and that paper is more pleasant to handle and touch than other media (67 percent). But survey results also show that many Americans still have misconceptions about the environmental impacts of print and paper.

The Two Sides survey indicates a majority of respondents are concerned about the effect of print and paper production on forests and believe that there is a connection between the loss of tropical rainforests and the manufacture of paper.

The survey also found that more than half respondents believe that electronic communications are a more environmentally friendly way to read books, magazines, and mail. “That's another myth that has been perpetuated by financial institutions, utilities, and other organizations that are trying to save money by encouraging consumers to go green by going paperless,” Phil Riebel, Two Side's President, says. “The fact is that both electronic and paper-based communications have an environmental footprint, and making both smaller is the right environmental choice.”

Doc agrees with that last point, but remains skeptical of some of this report's findings – I'd like to see the full survey and understand the methodology a little better. You can find out more about the sponsoring organization here.

The United States and Europe are mature markets for office equipment and therefore growth in these countries is expected to be relatively slow in the near future. Strong growth is expected from the developing markets of Asia, Latin America and Eastern Europe, in particular China, Brazil, India, Indonesia and Russia. China represents the largest market for office equipment in Asia-Pacific, with the demand for equipment such as Multi Function Products (MFPs) increasing at a significant pace. Rapid economic growth and emergence of numerous small and medium scale enterprises is contributing to the increased demand for low-end MFPs in China.

Product and technology innovations are driving global sales of office equipment. The new products are also cost-effective, efficient, and user-friendly thereby improving business efficiency of office environment. Presently, multifunctional products, that are capable of carrying out many tasks, are becoming popular in offices and home setups. Technological advancements have also played a vital role in improving the quality and reliability of multifunction printers. Further, the development of standards for interoperability of various electronic digital devices has made it possible to develop the multifunctional products.

The small office and home office (SOHO) sector offers enormous opportunities for manufacturers of office equipment. The sector accounts for a substantial portion of the demand for printers, PCs, copiers, scanners, faxes, and answering machines. While laser printers are popular with small offices, inkjet printers are popular with home offices. The market has also benefited from the declining prices of various products targeted at the SOHO sector. The increase in home office users fueled growth in the PC and telecommunications markets. Advent of powerful and flexible new computers and networking equipment provides home-based enterprises the advantage of having computing power similar to that of a large corporation. Consequently, the demand for PC and equipment, including printers, fax machines, and scanners, continues to rise among home-office users.

The research report titled “Office Equipment: A Global Outlook” provides a collection of statistical anecdotes, market briefs, and concise summaries of research findings. The report offers an aerial view of the global industry, identifies major short to medium term market challenges, and growth drivers.

The latest analysis compares 11 hardcopy vendors participating in the worldwide managed print services (MPS) market. IDC's detailed MPS definition emphasizes proactive management of customers' imaging and printing environment, continuous improvement of that environment, and change management.

Among other vendors, Ricoh achieved high scores in both the strategic and capabilities categories. "Ricoh's development of its global scope (consistent global structure, governance and process) is one of its biggest differentiators," states the report, authored by IDC's Holly Muscolino, Research Director for the Hardcopy Peripherals: Software and Services program. "The company's structured approach to MDS delivery is also distinctive."

Ricoh has leveraged its global experience to shape its Managed Document Services (MDS) strategy for addressing pressing customer concerns in MPS, including cost control, environmental sustainability, information security and governance, business process efficiency, organizational change management, information worker productivity, information optimization and strategic infrastructure.

Ricoh MDS is a globally cohesive approach to executing Ricoh programs based entirely on the ways clients prefer to do business. Its streamlined delivery framework - Understand, Improve, Transform, Govern and Optimize - strengthens the three stages of partnership engagement: Project Management, Service Management and Organizational Change Management.

See here for more information about the IDC research report.

Inkjet technology has come a long way in recent years and is scaling up to commercial production quite nicely, with many offerings from all the major press manufacturers. In digital printing, inkjet is now just as viable for many uses as toner-based systems.

So I've been watching with interest a great series of articles by printing industry veteran and all-around-nice guy David Zwang, over at What They Think.

In one installment, Dave looks specifically at the inkjet offerings from Ricoh – he's tackled other manufacturers in earlier installments and still has a few to go, so the series is worth keeping an eye on.

If you're curious about the inner workings of inkjet technology, Dave's series is a great primer on all the major players. Well worth a look.

According to one poster, when a job is outsourced to a third party, the customer typically prints up to 20% more copies than they actually need, either to get a better price or to make sure they are covered should the need for more copies arise. These "extra" copies tend to get thrown away eventually, representing quite a bit of lost profits and efficiency.

That got Doc to thinking, and I have to agree – printing in house whenever possible is likely more efficient for many small-to-mid-sized jobs. In my personal experience, I would concur that when sending jobs out to a commercial printer, the tendency is to order slightly more than you need. Printing in house usually results in a more accurate count as you know you can always print more if you need them.

Of course, a lot of factors go into deciding if a job should be printed in-house or outsourced – not all of them have to do with quantity. But throwing away unneeded copies of a print job is one of the most wasteful things you can do when it comes to managing your printing costs.

But let's not just think of cost – it could be that the commercial printer is actually cheaper per copy, so even when you factor in the waste, you come out financially ahead. But what, then, about the environmental impact of your decision? There are also hard costs associated with storing and disposing of unneeded copies.

The lesson learned is that accurate forecasting of print needs, whether using in-house or outsourced resources, is critical to keeping costs low and efficiency high.

And though most people are focusing on Kodak's consumer photography business, the company is also very active in commercial imaging. So what does bankruptcy mean for the commercial side of Kodak? Jim Hamilton over at InfoTrends, penned an interesting perspective:

Kodak has two main business areas: consumer and commercial. The consumer business sells digital and video cameras, digital frames, inkjet printers, photo kiosks, and on-line print services. The commercial group is mainly businesses associated with graphic communication in production environments. I'll focus on the commercial side of Kodak's business because that's what I know best:

• Printing plates – Printing plates make up about 50% of Kodak's commercial business. This is a large business, but it's not poised for growth. Still, this business could be an attractive purchase for a large chemical company or a group of investors able to manage this asset to its highest profitability. Another possibility would be a company with influence in regions outside of North America and Western Europe. Plate sales in some regions do present much better growth opportunities than in developed markets. China comes to mind.

• Inkjet – Kodak's Dayton operation has the potential to provide the highest future growth and the company has some very impressive technology in this area including its Prosper and Versamark product lines. Two companies would be well advised to consider acquiring this component. One potential buyer is Xerox, which is just beginning to become active in the production inkjet area and could take a huge step forward with the purchase of this part of Kodak's business. I'm sure some will doubt the likelihood of Xerox acquiring a piece of its long-time rival, but it is a good match. Another potential buyer is Konica Minolta, which could benefit not only from Kodak inkjet technology, but also from some of its electrophotographic assets.

Jim has a lot more to say and ponders the fate of other commercial divisions at Kodak including electrophotography, computer to plate, proofing and workflow products. If you're using Kodak commercial imaging products, it's a worthwhile read.

It's becoming clear that offices are not producing the copy and print volumes they once did. The ubiquitous memo that was once copied and distributed to all relevant parties within an organization is now delivered electronically as a PDF document. As a younger, more "digital-ready" generation enters the workforce, one that has become accustom to consuming, producing and editing information electronically, print volumes will continue to decline. Factor in the accelerated adoption of iPad's and tablet computers and the future doesn't look as bright for those who depend on the printed page to keep the business running.

The decline in print volumes is not going to reverse, at least in our opinion, however there are new business opportunities that dealers are well-positioned to capture if they take a proactive approach in modifying their business model.

So what does Jim recommend a supplier do to hold on to its customer base? His suggestion is simple: "mark your territory." You'll have to read more to see what he has actually has in mind!