2. Making the balance
of payments 0
More money for
reinvestment and
acquisitions
Paying no dividends
Xerox has 1.01 billion outstanding share and paid about 0.27 dividends in currents year,
By paying no dividends, Xerox could reinvest about 272,700,000 $ more in current year
1.https://finance.yahoo.com/q/ks?s=XRX
2. Baghai, M. Smith, S. Viguerie, P., Is your growth strategy flying blind?, Harvard Business Review
What if Xerox pays no
dividends?
Advances in IT and Granular approach to dramatically growth
-Digging deeply the global market into micro markets; categorizing the
global market to hundreds of micro segments
-- Taking more rational and more rewarding investment decision
Granular approach and 2 dimensions to seize market
Portfolio momentum Mergers and acquisitions Market share gains1st dimension:
• Granular approach looks at portfolio momentum of market in extremely fine detail, It divides the
business into geographic, customer and business slices and can make up to 4000 pockets
3. 2d dimension in
granular approach
to seize the
market: Company performance; the use of MRI tool
The conceptual of MRI approach is to find the relationship between shareholder value creation and
three market potential components; which are Portfolio momentum, Mergers and acquisitions,
Market share gains.
Xerox can benchmark net growth rating of each fine segment to the net growth rating of related
industry thus finding areas of weak and strong growth and quickly point to priorities for investment
and divestment.
The power of MRI is because of granularity. It is possible to analyse thousand of fine segments of
market to get extremely detail data to find out areas of opportunity based on region and type of
business.
Xerox will need a big team to implement granular approach
Xerox needs to develop responsibility for the pursuit of fine- grained opportunities to its
200 plus top leaders and all these leaders have to be well trained about granular
approach.
Baghai, M. Smith, S. Viguerie, P., Is your growth strategy flying blind?, Harvard Business Review
4. http://www.xerox.com/corporate-citizenship-2015/our-commitment/company-profile.html
Xerox 2014 revenue by geography
The revenue stream is
mostly from U.S, while there
are good opportunities in
Asia and other parts of the
world, which currently has
just small portion of Xerox
revenue stream.
Xerox has dominated a small portion of 5.6% of 120 billion
printers/supplies and has focused on service industry mainly in
U.S
Source: IT Condor
5. Xerox current global research centers and suggested new research centers
: Xerox current research centers in U.S, Canada, India
and France that are centralized to the Xerox Headquarters
in U.S
: Suggested research centers to be established in Eastern
Europe, Middle East, Africa and South America. It is
recommended that all research centers become semi
autonomous to discover local needs and research on
projects that responds to the local needs.
6. Xerox current global research centers and suggested new research centers and their subordinate centers
: Xerox current research center in U.S, Canada, India and
France that are centralized to the Xerox Headquarters in
U.S
: Suggested research centers to be established in Eastern
Europe, Middle East, Africa and South America. It is
recommended that all research centers become semi
autonomous to discover local needs and research on
projects that responds to the local needs.
Fuji- Xerox zone
: Semi autonomous subordinate research centers that
study on adaptation of products, services and needs of
local markets and work closely with research centers
7. Global Printing industry
7
In north America, western Europe, and Australia the trend of printing growth is negative,
while in the rest of the world is positive.
• Xerox has to reallocate its resources in printing industry from north America, western
Europe, and Australia to Asia, Latin America , Eastern Europe, Middle East and Africa
8. Mission: Giving our client
freedom to focus on their real
business
Values:
-Deliver quality and excellence –
behave responsible as corporate
citizen - use technology to
develop market leadership-
Require premium return on assets
- Becoming “Glocal” to dominate
new markets, Delivery of
customized and diversified
products based on local needs-By innovation and R& D,
Xerox creates world- class
technology
- Services
-Worldwide suppliers’
network
-- Manufacturing
-- HR
-- New Semi autonomous
research center and their
subordinates
- Diverse employees
- Global partners and supply chain
- Global clients with global and local
needs
-- Local clients with local needs
- Shareholders
- More diverse and customized
products
- More profitable investments
benefits shareholders more
- Attraction of more local talents
- No dividends
Most productive and multi
function products in the industry
-Cost efficient
- Helps companies become
greener
- Customers’ satisfaction
-- Value our employees
- More customized and diversified
products and services with
focusing on local market trends
and needs
Offer
Creation
Character
Stakeholders
8
Xerox poles after changes
9. More customized
and diversified
products and
services with
focusing on local
market trends
and needs
Attracts more
customers, Builds
loyalty, responds to
customers'’ needs,
stimulates
customers’
engagement and
make customers
recommenders for
Xerox
More local research
centers attracts local
talents, help talents
to think globally but
act locally, Helps
local talents to
develop their skills
and knowledge,
builds loyalty with
local talents
Profitable
investments
increases Xerox net
profit, Xerox stock
price increases,
builds investor
loyalty and make
investors
recommenders for
Xerox
Offer
Clients Shareholders
Talents
Xerox
10. Working capital
High revenue
Net cash from
operating activities
Revenue from Annuity
Higher Net income from
operating
Capitalizing on Xerox and
market opportunities
Technological
leadership
Optimize internal
productivity and
infrastructure
Leverage distribution
investment
Higher rate of
Customer retention
and attraction
Employee benefit
programs
Xerox partner
programs and
incentives
Investment in semi
autonomous local
subordinate research
centers around the glob
along with research centers
Green strategy and
solution , Six Sigma
approach
Customer brand trust
Quality after- sales
support and worldwide
presence
Efficiency and
productivity of
products
Differentiation in
products and services
and global sales
Financing more
customers and
partners
Higher Service sales
growth
Total satisfaction
guarantee
Xerox closed- loop
supply chain
http://www.xerox.com/annual-report-2014/financial-highlights.html, https://www.macroaxis.com /invest/ratio/XRX--Working-Capital
Xerox Green operation
Xerox Prosperity
Model
More rational
acquisitions and more
rewarding investments
Increasing partners
globally
Costs reduction
Economy of scale and scope
No dividends
payment
More diversified and
localized products and
services
Granular approach;
Using MRI tools
11. Learnings
Xerox and industry:
1. Coherency among business poles
2. Importance of supply chain
• particularly Xerox use Closed- loop supply chain to increase efficiency and reducing costs
• Xerox uses Supply Chain Management to achieve excellence supply chain
• Financing partners and reward system
3. Link between financial success and good business model
4. Xerox uses Six Sigma to achieve operational excellence
5. The shift in document process management market from product industry to service
industry; Xerox has changed its business model to service industry to respond to the
market shift
6. Xerox business model is annuity based to recruit significant revenue and cash generation;
Xerox policy is to repurchase share, acquire and expand and pay stable dividends
7. The more competitive advantage the company has in market for its stakeholders, the lower
the Porter forces on company will be
Key learning of business model:
1. The link between credo, offer , creation and business success
2. The business canvas; effective way to simplify any business model
3. The effect of change in value proposition on different parts of business model such cost
structure
4. Analysis of business models
5. Typology in business model
• Identifying the key drivers models
• Proposing the taxonomy of business model
• Offer and the level of diversification
• Type of market
12. • Type of revenue streams
• Origin of creation pole
6. Each business model has 4 poles
•The character pole; which describes the DNA of company
• The creation pole, which involves core processes and strategic resources
• The stakeholders; which involves talent, enablers and clients
• The offer pole; which describes offers proposed to stakeholders
7. Designing the value creation network
• Phase 1. List of all activities
• Phase 2. Choosing stakeholders
• Phase 3. Choosing the type of relationship and IT infrastructure
8. Purpose of being, Credo , mission, hypothesis, values & principles and vision
9. Reaction to Hypothesis by creation and offer
10. Though in business model based on Tetrahedron, poles and flows are distinct, but
they are in connection with holistic business model, so analysis of business model
will be easier (Tetrahedron is holistic business model)
11. Poles can help for taking important decision in designing business and its
implementation
Though the Canvas are very useful to simply show the entire business model elements,
but it does not have credo, mission, hypothesis, values & principles and vision of
business model
