Xerox: Work Can Work Better and the Art of Losing Money

The products Xerox makes and markets are not part of the rapidly advancing world of clouds and complex, but not hard to use, software. Since marketing will not change perceptions of Xerox, the advertising will do nothing for shareholders either. Many of them decided long ago that the value of Xerox does not work at all. The collapse of the market earlier in the week did not hurt Xerox shareholders much. The stock price already had dropped by 25% this year.

This is what Xerox has to say in it new ads about its ability to help people who work:

Remember when people said technology would make life easier? That it would do the hard work for you so you could enjoy more ‘you time’? We remember that.

Now try and think of a week when you didn’t see a colleague eat lunch at their desk. Or a weekend when you weren’t distracted by emails pinging on your phone? Exactly.

Technology was supposed to work for us, but more often than not it feels like we work for it.

What went wrong? And how do we fix it? How do we make work work better?

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Most of Xerox’s product lines are based on ancient ways of working. Xerox is in the document management business. It also has a division that makes and markets copiers, which has been part of the company since it was modern technology decades ago. These products are still a part now that the technology is old and, to many companies, useless. As a matter of fact, Xerox even sells copier toner — which makes life easier.

The best way to look at Xerox’s future is whether the past has anything to do with it. For a fairly long time, the past has been terrible.

In the most recently reported quarter, Xerox revenue dropped 7% to $4.6 billion. Net income dropped 95% to $12 million. Xerox did post some impairments. The first quarter was just as bad, but net income only dropped 20% to $225 million. The numbers were helped because there was no impairment. Last year, revenue dropped 2% to $19.5 billion, and net income by 16% to $969 million. Xerox is slowly disappearing.

When will Xerox be able to say “Work Can Work Better” at its own company? Ursula Burns has been chief executive officer since 2009. Five of the eight independent board members’ tenures predate that. Share ownership among them is at pitiful levels.

(By the way, one of the first of the new ads features the U.S. Open. Look for Burns and her board sitting in the best seats in the stands.)

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