Anne M. Mulcahy, the CEO of Xerox at the time, decided to focus on two things to turn things around for Xerox. The first thing was the customer base that treasured Xerox and the second was the committed workforce that was willing to do just about anything to save the company. A bold plan was formulated involving three things: fixing the liquidity issue through raising cash by selling some assets; restructuring of cost base; and strengthening the company’s core business. As a result, the company has completely turned around but, some tough choices were made including: outsourcing office manufacturing; cutting capital spending in half; and reducing worldwide employee workforce by about a third.
Leadership strategies that the CEO employed to accomplish this turn around was look before you leap strategy which was efficient when gathering information from customers and employees. Another strategy was communication. It was also important to communicate with the employees worldwide and let them know about the level of the problem being handled and their view on how it should be handled. Another was being a powerful motivator to all employees to ensure their productivity. Similarly, there was the going back to the basics of fundamental discipline including accounting for inventory which the company had overlooked over the years. Another was following one’s instincts which was important when making decisions based on data provided by experts. Additionally, she had to kill the corporate culture that had put the company in the position it was. The most important strategy was focusing on customers who are the most important constituents of the company.
Leaders took ownership of customer relationship management by personally reaching out to key customers and getting their views. Furthermore, they formulated the vision statement which was what the company would look like after the turnaround. Another strategy was good critic, which was important for keeping the leaders on their toes. Lastly was perspective and humor. A good relationship with those who worked with her and for her and a good sense of humor was a key part in ensuring cohesion in the company.
From these lessons, the actions that can be applied to long term care are vision. It is important to have a vision of what one wants on a long term basis. For instance, Xerox had to make a vision statement in the form of a “fake” wall street journal article of what the company would like in 2005. This was integral in helping the company overcome their present problems since it gave them something to look forward to and the hope that they would survive. Another action that can be applied is good leadership. Practicing good leadership is most important since it has the ability to move mountains over a long period of time. This can be seen in the case of Xerox in that the work to turn around the company started way back in 2000, and up to date, these positive effects of good leadership can still be felt.
Stanford Graduate School of Business. “Former CEO Mulcahy on Turning Xerox Around.” YouTube, 55:44min, January 23, 2011. Retrieved from https://www.youtube.com/watch?v=Q_hRTyllwC4