Case Study Analysis Xerox

Case Study Analysis:
Xerox Company
Submitted by:
Jeramie G. Alag
Submitted to:
Mr. Cesar Reyes
Summary
Xerox is a document company serving global document processing and financial

services market. The business exist over 160 countries.
They developed, manufactured and marketed copiers and duplicators,scanners,

computer softwares and other related equipments.
The Success Story From year 1946 to 1973 annual sales growth exceeded 25%.
Annual growth of earning exceeds 35%. The above achievements were in plain
paper copier business. In the year 1959 the company introduced 914 plain paper
copiers that was early revolution in this business. The copying equipment
business achived the growth from 20 million in 1959 to 9.5 billion in1965 just
within 6 years In 1990 the world copy business was over 900 billion copies.
Financial Services Operations includes:- insurance. Equipment financing
Investment & Investment banking
Xerox developed a corporate revitalization plan called “Leadership through

quality”. Plan was developed to meet customers requirements. Senior
management drives this LTQ plan with the help of employees to focus on the
process as well as products. LTQ plan was fully integreted business process.
Major components of LTQ are:- 1)Employee involvement 2)Competitive
benchmarking 3)Quality improvement process
Question and Answer
1. Explain the circumstances that led Kearns to adopt the “Leadership Through
Quality” program. In the backdrop of his initiatives to retain Xerox’s global
competitiveness. Comment on the rationale behind the decision to implement
benchmark practices at the company.
David T Kearns, President planned long range quality strategy. He believed that it
can be achieved by the ff:
 Understanding customer value. By thinking that what the customers perceive

as value is important.
 Value stream analysis. Having understood the value for the customers, the
next step is to analyse the business processes to determine which ones
actually add value. If an action does not add value, it should be modified or
eliminated from the process.
 Flow. Focus on organizing a continuous flow through the production or supply

chain rather than moving commodities in large batches.
 Pull. Demand chain management prevents from producing commodities to

stock, i.e. customer demand pulls finished products through the system. No
work is carried out unless the result of it is required downstream.
 Perfection. The elimination of non-value-adding elements (waste) is a

process of continuous improvement. “There is no end to reducing time, cost,
space, mistakes, and effort”.
2. Define benchmarking and discuss the various types of benchmarking. Explain
the steps involved in the implementation of a typical benchmarking process.
Benchmarking is the process of comparing one's business processes and

performance metrics to industry bests or best practices from other companies.
Dimensions typically measured are quality, time and cost. Business process
reengineering is a management approach aiming at improvements by means of
elevating efficiency and effectiveness of the processes that exist within and
across organizations. The essence of benchmarking is the continuous process
of comparing a company’s strategy, products, processes with those of the world
leaders and best-in-class organizations.
 Strategic :- Long term strategies, not industry specific.
 Competitive :- compare product and services, same sector.
 Process :- identifying and observing the best practices, objective is to

benchmark cost and efficiency, similar work or service.
 Functional : Comparing specific business function, same of different sector.
 Internal : benchmarking against its own units, different group, teams or

branches. External: comparing performance with companies in a specific
industry or across industries.
3. Describe Xerox’s benchmarking model. How did Xerox go about implementing

benchmarking practices in the company?
The 'Leadership through Quality' program encouraged Xerox to find ways to
reduce their manufacturing costs. Benchmarking against Japanese competitors
helped Xerox to find the following issue:
a. Time taken to bring product to market.
b. Number of engineers required.
c. Number of design changes.
d. Design costs.
e. Total cost.
f. Defects as compared to competitors.
g. Required productivity growth rate to catch up with the Japanese.
Xerox defined benchmarking as 'the process of measuring its products, Services,

and practices against its toughest competitors, identifying the gaps and
establishing goals. Our goal is always to achieve superiority in quality, product
reliability and cost. Xerox developed its own Benchmarking model which involved
tens steps categorized under five stages - planning, analysis, integration, action
and maturity. The five-stage process involved the following activities:
 Planning: Determine the subject to be benchmarked, identify the relevant

best practice organizations and select/develop the most appropriate data
collection technique. Analysis: Assess the strengths of competitors (best
practice companies) and compare Xerox's performance with that of its
competitors. This stage determines the current competitive gap and the
projected competitive gap.
 Integration: Establish necessary goals, on the basis of the data collected, to
attain best performance; integrate these goals into the company's formal
planning processes. This stage determines the new goals or targets of the
company and the way in which these will be communicated across the
organization
 Action: Implement action plans established and assess them periodically to

determine whether the company is achieving its objectives. Deviations from
the plan are also tackled at this stage.
 Maturity: Determine whether the company has attained a superior

performance level. This stage also helps the company determine whether
benchmarking process has become an integral part of the organization's
formal management process.
4. What benefits did Xerox derive from the implementation of benchmarking

practices? Why do you think benchmarking initiatives sometimes fail to give
companies the expected benefits? Explain how you would go about ensuring the
success of the benchmarking initiatives undertaken by the company.
Customer complaints declined by more than 60%.

Customer satisfaction with Xerox's Sales processes improved by 40%.
Service processes by 18%.
Administrative processes by 21%.
Overall customer satisfaction was rated at more than 90% in 1991.
Number of defects reduced by 78 per 100 machines.
Service response time reduced by 27%.
Inspection of incoming components reduced to below 5%.
Defects in incoming parts reduced to 150ppm.
Inventory costs reduced by two-thirds.
Marketing productivity increased by one-third.
Distribution productivity increased by 8-10 %.
Notable decrease in labour costs.
Errors in billing reduced from 8.3 % to 3.5% .
Conclusion:
Benchmarking enables decision-makers to understand exactly how much

improvement they will need to accomplish in order to achieve superior
performance. Frequent and regular benchmarking helps us to create specific and
measurable short-term plans that are based on current reality rather than
historical performance, and which can support step- by-step improvements in
performance over time. The objective is to overtake the top performers, turning a
performance deficit into performance leadership.

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Case Study Analysis:

Xerox is a document company serving global document processing and financial

They developed, manufactured and marketed copiers and duplicators,scanners,

Xerox developed a corporate revitalization plan called “Leadership through

Question and Answer

 Understanding customer value. By thinking that what the customers perceive

 Flow. Focus on organizing a continuous flow through the production or supply

 Pull. Demand chain management prevents from producing commodities to

 Perfection. The elimination of non-value-adding elements (waste) is a

Benchmarking is the process of comparing one's business processes and

 Strategic :- Long term strategies, not industry specific.

 Competitive :- compare product and services, same sector.

 Process :- identifying and observing the best practices, objective is to

 Functional : Comparing specific business function, same of different sector.

 Internal : benchmarking against its own units, different group, teams or

3. Describe Xerox’s benchmarking model. How did Xerox go about implementing

a. Time taken to bring product to market.

b. Number of engineers required.

c. Number of design changes.

f. Defects as compared to competitors.

g. Required productivity growth rate to catch up with the Japanese.

Xerox defined benchmarking as 'the process of measuring its products, Services,

 Planning: Determine the subject to be benchmarked, identify the relevant

 Action: Implement action plans established and assess them periodically to

 Maturity: Determine whether the company has attained a superior

4. What benefits did Xerox derive from the implementation of benchmarking

Customer complaints declined by more than 60%.

Benchmarking enables decision-makers to understand exactly how much

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