Article Review on Fuji acquiring Xerox by Steve Lohr and Carlos Tejada

Read the article about Fuji acquiring Xerox, attached here.

Essay prompt:
If you were advising a Xerox executive in the past who wanted to adapt and transform the company so that it would remain successful and independent, what actions or activities would have been necessary across the 4 dimensions of company activity?

2 page maximum. APA guidelines required. See:

For a short essay, an abstract will not be required. A brief thesis statement (one sentence) is recommended. See:

After Era That Made It a Verb, Xerox, in a Sale, Is Past Tense
By STEVE LOHR and CARLOS TEJADA JAN. 31, 2018 New York Times
When Xerox introduced its popular copying machines in 1959, their wizardry was considered as
high tech as the iPhone when Steve Jobs presented it to the world almost 50 years later.
But just as Xerox made carbon paper obsolete, the iPhone, Google Docs and the cloud made
Xerox a company of the past.
On Wednesday, Xerox said that, after 115 years as an independent business, it would combine
operations with Fujifilm Holdings of Japan. The deal signaled the end of a company that was
once an American corporate powerhouse.
“Xerox is the poster child for monopoly technology businesses that cannot make the transition
to a new generation of technology,” said David B. Yoffie, a professor at the Harvard Business
The move offers a stark reminder that no matter how high a company may fly, it is still
vulnerable to the next big breakthrough. Xerox joins once formidable tech companies like
Kodak and BlackBerry that lost the innovation footrace.
Under the deal, Fujifilm will own just over 50 percent of the Xerox business. There are plans to
cut $1.7 billion in costs in coming years. Fujifilm said it would cut its payroll by 10,000 workers
How Xerox fell so far is a case study in what management experts call the “competency trap” —
an organization becomes so good at one thing, it can’t learn to do anything new.
Xerox traces its origins to the founding in 1903 of the M. H. Kuhn Company. But it was an
invention dreamed up in a makeshift Queens lab in the 1930s — a forerunner of the Silicon
Valley garages used by the likes of Mr. Jobs — that changed Xerox’s trajectory.
That invention, by Chester Carlson, a patent lawyer, led to the creation of the modern copy
machine. He even came up with a term for the process: “xerography.” In 1959, Xerox, which
had won the right to explore the technology, offered the office copier that went mainstream.
Soon, Xerox copying machines were a booming business and central to office life, a spot for
informal conversations and gossip. In larger companies, “Xerox rooms” became a place to hang
High-end Xerox machines — essentially, complex paper-processing computers — became
symbols of modern technology, sometimes getting the upper hand on hapless humans. In a
classic scene from the 1980 movie “9 to 5,” a copier overwhelms an office newcomer played by
Jane Fonda.
Its corporate name even became a verb.
During the good times, Xerox invested in new technology. In the 1970s, it set up a research
center in Palo Alto, Calif., far away from its East Coast headquarters. Its goal was to invent the
office technology of the future.
The technologists at the lab, the Xerox Palo Alto Research Center, did not invent the computer
mouse and graphical-user interface. But they refined them and built a usable prototype
personal computer, the Alto. More than 1,000 Altos were made and put to work, including a
few in Jimmy Carter’s White House.
In 1979, in a visit that is the stuff of business legend, Mr. Jobs toured the lab. Later, the ideas he
saw there found their way into the Apple Macintosh.
Over the years, Apple has had its own ups and downs. But whenever Mr. Jobs became
convinced that something new was afoot, he moved forcefully and refocused the company. He
did not fall into the competency trap, and today Apple is the most valuable corporation in the
At Xerox, when the corporate managers took over its personal computer project and tried to
commercialize the Alto, named the Xerox Star, they priced it at more than $16,000. It flopped.
The Xerox Star was priced more like a copier, an expensive office machine, rather than a
personal computer. In 1981, the same year the Star came to market, IBM introduced its PC for
business, pricing it at less than $1,600. Three years later, the Apple Macintosh sold for about
In the 1980s, with the patents on its copier technology expiring, Xerox faced stiff competition
from lower-cost Japanese competitors like Canon and Ricoh. With its business under pressure,
Xerox dabbled in financial services. It bought a casualty insurer, Crum & Forster, and an
investment management firm, Van Kampen Merritt.
The move into financial services ran into trouble, and the company sold it all off in the 1990s.
Since then, Xerox has struggled with the rise of email and the move by offices around the world
to send and share documents electronically. Less paper and fewer copies undermined the
company’s once lucrative franchise.
In recent years, Xerox moved to recast itself more as a business services supplier, helping
companies streamline their flow of documents and work in fields like health care, human
resources and financial compliance. It won some high-profile contracts — like operating the
computer and payment systems behind E-ZPass highway tolls.
Yet none of its efforts delivered a sizable profit maker to make up for its declining copier
business. Carl C. Icahn, the activist shareholder, pushed the company to go further.
“We believe Xerox still has potential, but it will go the way of Kodak if there aren’t major
changes,” Mr. Icahn said in December.
The company’s leaders saw the problem. “The world is changing,” Ursula Burns, then chief
executive, said in an interview with NPR in 2012. “And as that world changes, if you don’t
transform your company, you’re stuck.”
Xerox never managed to get ahead of the digital wave to enjoy anything like its former
Under the deal announced on Wednesday, Xerox, of Norwalk, Conn., will become part of an
existing Fuji Xerox joint venture, which sells office products and services in the Asia-Pacific
region. As part of the deal, it will issue a combined $2.5 billion in cash dividends to its
The combined company is expected to have $18 billion in annual revenue and will continue to
trade on the New York Stock Exchange under Xerox’s ticker symbol, XRX.
“I am confident that Fujifilm’s ability to drive change as well as its experience of successful
reinvention will give a competitive edge to the new Fuji Xerox,” Shigetaka Komori, chairman
and chief executive officer of Fujifilm, said in a written statement.