Introduction - The Start To A Downfall
As Xerox's stock has been plunging up and down the last few months, the search for a guilty party is on. Many have pointed an accusing finger at the company's inability to invoice customers correctly. So why would Xerox one of the most respected corporations and an acknowledged IT leader - be hurt by something so ordinary?
The answer can be found in understanding a sequence of leadership misjudgments. A few essential events can permanently deflect an enterprise toward its rise or demise.
Xerox's fate can be traced back to 1983, when conflicts between its computer-oriented innovators and xerography focused sales force were settled by dooming the inventions from the company's Palo Alto Research Center to being technological geniouses without competent marketing to sell them. Shortly thereafter, Xerox management crippled itself from participating in the information races altogether by taking much of its cash and investing it in "safer" business lines such as insurance.
The company's outdated image, best known as a maker of old-style, high priced copiers is just one of the problems at Xerox, once considered a symbol of corporate success.
Its products were so popular in the 1960s and '70s that it fought to ensure that "Xerox" did not become a generic verb for photocopying.
But profits are down sharply, a failed sales force reorganization has separated customers and its stock price has plunged to one-third of its value a year ago. In March, the company announced it would slash 5,200 jobs and close manufacturing plants to reduce its cost structure so it could stay competitive with companies such as Hewlett-Packard, Canon and Ricoh. And both the company and the Securities & Exchange Commission are investigating accounting irregularities involving its Mexican operations. In April 1999, the company made Rick Thoman...