Culture, Leadership and Staffing at Xerox

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Culture, Leadership and Staffing at Xerox

After much reorganization and movement of leadership, Anne Mulcahy took over the helm of Xerox. Anne was a popular 24-year Xerox veteran promoted to president and chief operating officer when her predecessor Thoman was fired. Anne was a straight talker. She was very decisive in her decision making and took responsibility when she made an error. So much so that analysts were astonished Anne when conceded that Xerox had ''an unsustainable business model.'' However, Mulcahy later backed away from this statement, saying that she meant only that the company needed to cut operating costs and redirect investment from money-losing to high-margin businesses.
Bloomberg magazine report
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The Brazilian subsidiary, long the company's largest source of profit outside the U.S., was reeling from colossal currency translation losses and soaring interest rates. In North America, productivity was deteriorating as the sales force braced for the reorganization scheduled to begin in January.
All the while, Xerox strengthened its core business by maintaining an organization-wide focus on innovation. "Even with all of the cost cutting we did, we didn't take a dollar out of research and development," Mulcahy said.
Xerox hit a record high of nearly $64 a share in May, 1999, just three weeks after Thoman replaced Allaire as CEO. Today, the stock trades around $7, a few dollars above the price at which it listed on the New York Stock Exchange in 1961. The evisceration of $38 billion in shareholder wealth already qualifies Xerox as a corporate catastrophe of the first order. And the company's woes are not over yet--not by a long shot.

Xerox posted a loss of $198 million over the last three months of 2000, the largest quarterly loss in a decade. By even the most optimistic forecast (its own), the company will not edge back into the black until the second half of this year, at the earliest. With $2.6 billion in debt coming due this year and a $7 billion bank loan looming in 2002, Xerox is cutting spending, firing workers, and trying to raise as much as $4 billion by selling off assets.

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