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Introduction on Company Background People Problem 1 People Problem 2
The word "xerox" is commonly used as a synonym for "photocopy" For e.g. "I xeroxed the document and placed it on your desk."
HISTORY TO PRESENT
1938: Chester Carlson, a patent attorney and part-time inventor, made the first xerographic image He spent years trying to sell his invention without success (to IBM, General Electric etc)
Chester Carlson’s first Xerographic Apparatus
1944: The Battelle Memorial Institute in Columbus, Ohio, contracted with Carlson to refine his new process, which Carlson called "electrophotography." 1947:The Haloid Company (Founded in 1906),manufacturing photographic paper, approached Battelle and obtained a license to develop and market a copying machine based on Carlson's technology.
Since electrophotography seemed a cumbersome word decided on the word "xerography" derived from the Greek words for "dry" and "writing.“
1948-58:Haloid coined the word "Xerox" for the new copiers.
First Manually operated commercial xerographic copier(1949)
Changed its name in 1958 to Haloid Xerox Inc
1959: Came out with First photocopier, the Xerox 914 which sold more than 200000 units between 1959 and 1976.
First Desktop plain copier(1963)
1961: The company became Xerox Corporation after wide acceptance of the Xerox 914
1963:First desktop plain copier is introduced
1973:First Colour copier introduced
First colour copier (1973)
1970: The Xerox Palo Alto Research Center opened (For R&D) 1977:First laser printer introduced by Xerox
1990’s - turned its product into a service, providing a complete "document service" to companies Supply, Maintenance, Configuration, and User Support
Xerox today manufactures and sells a wide variety of office and production equipment
Office printers Office copiers Multifunction printers and copiers Fax machines High volume production printers and copiers Workflow solutions Software Scanners and projectors Computer monitors
Anne Mulcahy Glenn Britt Richard Harington William curt hunter Quincy Allen Ursula Burns James Firestone Jean-Noël Machon
Chairman and chief executive officer Director Director Director President, production systems group President, Business Group Operations President, Xerox North America President, Developing Markets Operations President, Xerox Europe Chief Financial Officer Chief Accounting Officer
Executive board Non executive board Non executive board Non executive board Senior management Senior Management Senior Management Senior Management
Armando Zagalo de Lima Lawrence Zimmerman Gary Kabureck
Senior Management Senior Management Senior Management
Offices in Europe,Africa,Middle East,India and parts of Asia In over 130 countries worldwide A $16 billion company
53,700 employees worldwide No. 142 in the Fortune 500 companies.
At the end of 2006, Xerox's U.S. work force was 14.4 % AfricanAmerican, 6 % Asian and 0.8 % Native American. Women made up 31.5 % of the total U.S. work force.
Assists more than 400 social, civic and cultural organizations Provided more than 40 grants to university research programs
Designing and building "waste-free" products Scholarship support at more than 140 colleges and universities to prepare students for careers in business, science and technology
Rated among the world's best by independent testing organizations Won 25 national quality awards in 20 countries
Canon Inc. Hewlett-Packard Company Konica Minolta Holdings, Inc. Lexmark International, Inc. Pitney Bowes Inc. Ricoh Company, Ltd.
Ignored new entrants like Canon, Ricoh Operating cost was high Products of relatively inferior quality compared to its competitors Return on assets came down to less than 8% and market share in copier came down sharply from 86% in 1974 to just 17% in 1984
In 1982,David T. Kearns took over as the CEO Average cost of Japanese machines was 40-50% of that of Xerox
Launching a program referred to as ‘Leadership through Quality’ Management layers were cut Greater authority delegated to lower levels Employees were allowed to participate in decision making
In 1980’s Xerox bought Kurzweil, Datacopy and Ventura companies that specialized in optical character recognition, scanning and fax machines It also diversified into financial services, insurance and investment banking
Allaire succeeded Kearns as the new CEO in 1990 In 1992 Xerox entered into various tie-ups with Dell Computer Corporation and Microsoft Company announced a major restructuring program including a 10% reduction in the workforce
In 1993 Xerox announced a company wide initiative to reduce costs drastically and improve productivity It indicated that it would reduce the worldwide workforce by more than 10,000 and close a number of operations This restructuring program achieved cost savings of $ 770 million in 1996
In 1998 Xerox announced another round of worldwide restructuring, including elimination of 9000 jobs through VRS, layoffs and closing of various facilities This program included cutting costs by $ 1 billion, sale of $ 2-4 billion worth of assets
In the same year, Thoman replaced Allaire as the CEO though Allaire continued as chairman Despite these restructuring efforts, poor market conditions resulted in the company reporting a loss of $ 257 million in 2000
In August 2000,Paul Allaire,Chairman of the leading document management company Xerox, fired the company’s CEO Rick Thoman
Allaire said," We are grateful for Rick’s contribution in leading the company through a period of major repositioning.However,both Rick and the board felt it best for the company to move forward with an experienced Xerox team that will lead Xerox people and efficiently execute the strategy
PEOPLE PROBLEMS - I
Chairman Joseph C. Wilson, his successor Kearns . Wilson brought progressive HR people from outstanding institutions. They build a very people oriented tradition that became famous for its training, development and sales selection policies.
People would be treated with respect at all times. People were treated fairly and generously. Compensation was designed to be competitive. Xerox could attract quality people.
1980, Xerox faced a stiff competition from Canon and Ricoh in the low end copier business.
mpany decided to opt total quality movement t manufacturing costs Fights back efficiently through employee participation
Developments in Xerox
Allaire replaces Kearns as the CEO in 1990. Reid, an integral part of HR function for three decades leaves the organisation. William F. Buehler , who had just 2 years of HR experience replaces Reid. Employees perceive Buehler’s appointment as the decline in HR role in Xerox’s corporate setup.
Many HR executives who were part of Reid’s team left the company. The culture of employee involvement seemed to be disappearing. The sense of dissatisfaction with the top leaders kept moving good people out of the company. Employees promotions were not carried out as per the company policies.
People with good relations with the top management were being promoted. Beuhler was promoted within two years of joining the HR department. Xerox kept loosing its top employees and found hard to attract new as well.
Thomas took control of the company. Found severe lapses in HR control systems for eg. No parameters to measure per employee income. He observed that Xerox had lost its focus from customer service.
PEOPLE PROBLEMS – II
THOMAN’S REORGANIZATION PLAN
Digital equipment Digital solutions Industry-based targets
Commissions reduced significantly. Sales representatives began losing their accounts. Sales staff attrition increased by 100%. No proper training.
Large scale layoffs I. 12000 employees II. 4500 employees Reactions – Strongly opposed. Thoman had to leave Xerox.
Claim of Media Reports
Allaire had not been able to ‘let go’ of the company’s control. Allaire’s ‘in circle’ consisting of Mulcahy and Buelher threatened to resign if Thoman continued.
Reason of failure
Employee involvement. Thoman’s responsibility.
Retention Programs - Increasing pay - Increasing incentives Training and education - e-learning Got in touch personally with employees
Attrition rate dropped to normal. Fall in profitability continued. Requirements – - Downsizing - Cost-cutting
Reported a loss of $384 million for the year 2000. Loss of $94million in 2001. By Jan 2001,stock dropped by 72% Reported to be on the brink of bankruptcy.
A $345 million credit from GE capital helped. Dec 2001, total revenues fell by 12% to $16.5 billion. Net loss rose by 18% to $342 million. Company sources attributed this to - global economic meltdown - higher income tax rate
Innovation - spending on R&D - 4 global research centres Pushing into services Adaptive and opportunistic Layoff Outsourcing Value to customers
The company generated profit of $978 million in 2005. Mulcahy became one of the world’s most respectable leaders. She was named the fifth most powerful women in the world by Forbes magazine.
STRENGTHS Strong brand Strong product development capability Distribution channels Dominance on the copier market WEAKNESSES Weak operating performance Dependence on third party manufacturers Stagnant revenues from the office segment
Opportunities The color market Launch of carbonless paper Outsourcing revenues Threats Intense competition Paperless offices Economic slowdown
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