Xerox case


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Xerox case

  1. 1. Enhancing value & Customer Satisfaction
  2. 2. The Copier IndustryIn U.S. copier placements had grown up at a slow rate of 2.9% Xerox categorized the copier industry into 3 product markets:• Low-volume marketa. Copiers made fewer than 50,000copies per monthb. Costs less than $4,000.c. Major players were Canon, Xerox, Sharp, Mita and Ricoh.
  3. 3. • Mid volume market:a. Copiers made upto 10,000 copies per monthb. Priced between $4,000-6,000c. Major players were Xerox, Canon, Mita, Ricoh and Konica.• High-volume market:a. Priced over $60,000b. Major players were Kodak and Xerox, Canon, Konica and Lanier competed in the lower end of the market
  4. 4. Xerox - Company Profile1959 : Haloid company launched model 914 office copier.1961: Haloid was renamed to XeroxProtected by a no.of patentsXerox diversified into various new businesses:• Purchased mainframe-maker scientific data systems• Office computing business including word processor, document processing workstation, networks, facsimile equipments, electronic type writers and financial service acquisitions.
  5. 5. The BackgroundIBM, Kodak, Japanese companies were main competitorsXerox’s cost and product prices were higher than the competitorsQuality had declinedMarket share and return on assets (ROA) had fallen drasticallyMarket share dropped from 100% in 1960 to under 40% in 1980Japanese had 40%-50% cost advantage
  6. 6. Customer Segmentation at XeroxCustomers:Commercial major accountsNamed accountsGeneral marketsGovernment and educationDistribution:sold directly by Xerox sales forceLow volume and low priced mid volume machines sold through dealer networksLowest priced machines sold through consumer retail chains
  7. 7. Product line and PricingIn 1990, Xerox had 2 lines of copiers:10 series and 50 seriesIn 1990, Xerox had 18 copiers: 4 in low-end, 9 in mid range & 5 in high endXerox copier ranged from $2,440-$154,000Had 30day/90day/3year warrantyLonger warranty- aggressive marketing tool
  8. 8. Customer satisfaction at Xerox3 corporate priorities:i. Return on assetsii. Market shareiii. Customer satisfaction Studies conducted showed customer satisfaction was not the top priority in day-to-day management of business Issue of guidelines and requirements to operating units to ensure customer satisfaction Guidelines focused on reorienting the company Operating units were given authority to respond to customers’ requirements
  9. 9. Customer ServiceCustomer Service at Xerox had several dimensions:• Fixing of units• Providing operating systems support• Communicating with customers• Resolving customer issues• Technical product support• Feedback to manufacturing, sales, marketing and administrationQuality of customer service was measured -• Customer satisfaction based on Customer survey• Expense to revenue ratio• Reliability• Service billing errors
  10. 10. Vision and goalsTo be recognized as the industry benchmark in customer satisfactionGoal had 2 components:I. External worldII. Internal worldTo achieve goals- market driven business strategies, product strategies, and investments determined by customer requirements
  11. 11. ActionsEmployees developed a proactive attitude, role, work emphasis focused on customer satisfaction.Customer satisfaction code of conduct was developed in the training curriculumLeadership through quality tools and processesCustomer relations groups(CRG) were initiatedLocal empowerment
  12. 12. Measurement of customer satisfactionExternal measurement system:i. Periodic surveyii. Post installation surveyiii. New product post installation surveyiv. Competitive benchmarking customer satisfaction survey
  13. 13. Internal measurement process:i. Assessment of Xerox products and services to the appropriate quality standardsii. Routine, Monitor and inspect internal performanceiii. Internal measures included• service response time• Billing errors• Training hours per sales rep.
  14. 14. Data analyses, review and follow-upIdentified segment specific satisfiers and dissatisfiersManage corrective action processRoot causes of problems were categorized and tracked
  15. 15. Customer GuaranteeIt was assumed that offering of guarantee would lead to customer satisfaction:1. Service guarantee2. Money back guarantee3. Product performance guarantee4. Product fit guaranteeSurvey conducted to find which guarantee customers would prefer.
  16. 16. Thank You