ox Corporation is a global company that offers ‘widest array of document-processing products consulting services in the industry. Xerox sells its Blshing systems, copiers, printers, scanners, fax Vauines, and dociment “management sofeware, Bing with telated products and services, in more. 1 130 countries. Xerox products and services are sled to help customers master the flow of infor- ton from paper to electronic form and back ‘The Xerox customer is anyone who uses docu Fortune 500 corporations and small compa- Xerox leads the way in digital imaging and what Pa caled distributed publishing. Xerox technology en- bls the home office to copy, print, scan, and fax _ruucnts using a single device; and far-flung enter- je lo transmit complicated, multipage documents jms networks for copying or printing. Xerox Fiied the office copying revolution with the intro- ation ofits 914 copier in 1959. Today, Xerox stands jyised for the continued expansion of the global réceument-procesing market, already enormous at Did illion# year and growing 10% a year. In 1995, f 10% of revenues were in businesses that grew more 20%: personal copying and printing (29%); doe- eit outsourcing (50%); production publishing {G1}; and color copying and printing (45%). Inckad- }upTuji Xerox, about two-thirds of the $25 billion in tenes are generated outside the United States. -YEROX AND QUALITY quality management and is iding its customers with innova- F tveproducts and services that fully meet their needs. + Temx products are consistently rated among the fase stuvy— Xerox Corporation—Leadership Through Quality world’s best by independent testing organizations. Since 1980, Xerox has won numerous quality awards, including the worlds three most prestigious: the Mak colm Baldrige National Quality Award for Xerox Products and Systems in 1989, the first European Quality Award for Rank Xerox in 1992, and the Deming Prize, Japan's highest quality award for Foji Xerox in 1980. Xerox is the first major US. carporation to re- gain market share after losing it to Japanese competi- tors. The company’s decision to rededicate itself 10 quality explains that accomplishment. In the 1970s, Xerox nearly became a victim of its own success, Iulled into complacency by the easy growth of its early years, Market share dropped to less than S0% by 1980, from nearly 100% a few years earlier. Forto- ‘nately, Xerox reacted to this chalionge with a strategy called’ “Leadership Through Quality” Using Fuji ‘Xerox in Japan as a model, Xerox created a participa- tory onanagement style that stressed improving qual- ity while reducing costs, Quality circles flourished and teamwork was fostered. Xerox also sought more cus- tomer feedback, changed its approach to product development to’ target key markets, reduced costs, encouraged greater employee involvement and began competitive benchmarking: the now widely used process of measusing performance against the tough- est competitors and against companies recognized as the best in a particular area, such as IL. Bean for dis- tribution and Toyota for quality control. LEADERSHIP THROUGH QUALITY ‘The “Leadership Through Quality” thrust has made ‘quality improvement and, ultimately, customer satisfac- fion the job of every employee, All have received ateast 28 hours of training in problem-solving and qual ity improvement techniques. The company bas vested more than 4 million man-hours and $125 millicn, in educating employees about quality principles. Work- rs ave vested ils uthonty eve bay today Work decisions. And, they are expected to take the initiative in identifying and correcting problems that affect the quality of products or services. Both salaried ard hourly personnel have embraced these added respon- sibilities. For example, the company’s 1989 labor contrast (the year they won the Baldrige Award) with the Amalgamated Clothing and Textile Workers’ Union pledged employee support to “continuous quality improvement while reducing quality costs through teamwork and the tools and processes of “Leadership ‘Through Quality." This partmership with the union is sonsidered a model in the industry. The phrase “Team Xerox” js not an empty slogan. It accurately reflects the firm's approach to tackling quality issu. Xerox Business Products and Services (BP&S) esi- ‘mates that 75% ofits workers are members of atleast ‘one of more than 7000 quality improvement teams. In 1988, teams in manufacturing and development were credited with saving $116 million by reducing scrap, tightening production schedules, and devising othar efficiency and quality-enhancing measures. Teamwork also characterizes the company’s re- lationship with many of its 480 suppliers. Vendors are “process qualified” through a step-by-step procedure to analyze and quantify suppliers’ production and control processes. Vendors rective training and follow-up in such areas as statistical provess control and total quality techniques; firms credit Xerox with improving their products and operations. For BP&S, increasing reliance. on qualified vendors over the lest five years has reduced the number of defective parts reaching the production line by 73%. Planning new products and services is based on detailed analyses of date organized in 375 information management systems, including 175 specific to plan- ning, managing, and evaluating quality improvement. Much of the wealth of data has been amassed throuzh an extensive network of market surveillance and cus tomer feedback, all designed to support systema.ic evaluation of customer requirements. Over half of tie ‘company's marketing-research budget is allocated for this purpose, and each year its Customer Service ‘Measurement System tracks the behavior and profer- ences of about 200,000 owners of Xerox equipment. BENCHMARKING SYSTEM In its quest to elevate its products and services to world-class status, Xerox BP&S devised a benchmark ing system that has, in itself, become a model. The company measures its performance in about 240 key areas of product, service, and business performance, Derived from infemational studies, the ultimate target {or cach attribute is the level of performance achieved by the world leader, regardless of industry. ‘Retums from the company's strategy for conti uuous quality improvement have materialized quick} Sains quay over the laste years inode a 78% the number of defects per 100 machines, peaty increased product reliability, as measured by2 40% decrease in unscheduled maintenance; increas ing copy quality, which has strengthened the com- pany’ position as world leader; a 27% drop (neat ‘two hours) in service response time; and significant uctions in labor and material overhead. These in- provements have enabled Xerox BP&S to tke additional steps to distinguish itself from the compet tion; for instance, it was the first in the industry to offer a three-year warranty. ‘The thrust of “Leadership Through Quality” ‘ongoing, The process of continuous quality improve’ ment is directed toward greater customer satista| Quality Policy, which states that “quality is the bass ‘business principle at Xerox.” XEROX AND DIVERSITY ‘Xerox views diversity in the workplace as more tha ‘1 moral imperative or a business necessity. They 2 it as @ business opportunity. They believe diversi ‘makes them better: People of all ages and with dif ferent backgrounds bring fresh ideas, opinions, pe spectives, and boundless creativity to the com Under the company's balanced workforce strat senior managers are evaluated on their ability hire, keep, and promote minorities and women. Eve when the company must reduce its ranks, the small ‘workforce is expected to mirror the workloroe fore the reduction, in the percentages of minorit ‘and women, Caucus groups are another aspect of diversity story at Xerox. These independent of Xerox employees date from the 1960s, The ai ceases, not Jabor unions but something akin to help groups, help members negotiate the ‘world and work to ensure that their members, like Xerox employees, have equal opportunities in ti ing, promotion, and training. XEROX AND SOCIAL RESPONSIBILITY Xerox understands that corporations, like priv Gitizens, have a responsibility to society at Civic virtue and community involvernent aremost cherished corporate values. The company jes out much of its philanthropic work through ‘Xerox Foundations, which ia 1995 contributed (milion in five areas: community affairs; educa fon and workforce preparedness, science and tech- slogy; cultural affairs; and national affairs. Xerox o supports employce involvement through two in wative programs, Social Service Leave and the Fesox Community Involvement Program (XCIP). ‘Under Social Service Leave, employees are {ed paid leaves of absence to work on community Mpojects of their choice. More than 400 have taken Araves since 1971. ‘The program is believed to be the “Afddest ofits kind in American business. Through XCIP {noups of Xerox employees can get corporate seed froney 10 work on meeting needs they identify in their ommunities, In 1995 alone, more than 20,000 Xerox employees took part in nearly 700 XCIP projects Xerox is committed to helping employees balance the mands of professional and personal life. The com- pany believes that by relieving some of the pressures in “5 personal fives, Xerox cam help them be more “Wionused and productive at work. Xerox offers chitd- fare subsidies, salary redirection for dependent-care fd expenses; childcare sources and referrals, eldercare ‘nbsultations and referrals; adoption assistance; leaves af absence; and flexible work arrangements. Tn 1993, Xerox introduced LifeCycle Assis- lance to address the changing needs of a diverse ‘workforce. Money from this program of flexible ben- 4 its can be put toward the purchase of a first home, snd toward the purchase of health insurance for jouschold members not generally eligible for cover- age under the Xerox health plans, such as a domestic parmer. LifeCycle Assistance is another important Hep toward giving employees greater choice in how benefit dollars are spent. Xerox ranked No. 1 on Money magazine’s 1995 list of U.S. corporations with the best employee benefits. XEROX AND THE ENVIRONMENT ‘Xerox is proving that what is good for the envizon- ment can also be good for business. Their environ- mental initiatives have already saved hundreds of millions of dollars while reducing pollution, waste and energy consumption. The motto “Reuse, Re- ‘manufacture, Recycle” reflects their goal: To create Waste-ftce products in waste-free factories and of- ces using what is called Design for the Environ- ment. Most copiers, printers, and multifunction Gevices are now designed to be remanufactured at the end of their initial life cycles, an approach made ‘possible by the durability and quality of Xerox prod- lets and parts. Xerox uses only recyclable and recy- cled thermoplastics and metals. The company has ‘adopted snap-together designs to facilitate assembly and disassembly, for the cleaning, testing, and reuse cof parts. In 1995, Xerox received the Environmental ‘Achievement Award from the National Wildlife Federation, which cited the company’s Design for the Environment program. QUESTIONS FOR DISCUSSION 1. What are some of the unique characteristics of the ‘quality culture at Xerox? 2, Discus the major stratogic goals of Xerox. Compare sand contrast this to another company of your choice. List some goals of a company other than profit max- ‘mization and discuss the social responsibilities of a. ‘organization as promoted by Xerox. 3. Deseribe the benchmarking efforts of Xerox. Dis- ccuss what steps Xerox could have taken to avoid Joss ‘of market share prior Co ts turnaround in the 1580s, 4. Discuss the role played by the management at Xerox ‘im adopting the quality policy. 5, What are some efforts undertaken by Xerox to en- sure satisfaction of its employees? How would you ‘monitor such a system to maintain eniployee com- ‘mitment?