Financial and Environment analysis of Rank Xerox Corporation over the Year 2006 to Year 2015?

1. INFORMATION SYSTEM, ORGANISATION AND STRATEGY IN
GLOBAL PERSPECTIVE 1
INFORMATION SYSTEM,
ORGANISATION AND
STRATEGY IN GLOBAL
PERSPECTIVE
Question
The market for optical copiers is shrinking rapidly. It is expected that by 2015, as much as
90 percent of all duplicated documents will be done on computer printers. Can a company
such as Xerox Corporation survive?
Answer
INTRODUCTION (Brief history)
Xerox Corporation is an American multinational document management corporation
that produces and sells a range of color and black-and-white printers, multifunction
systems, photocopiers, digital production printing presses, and related consulting services
and supplies. The company also offers business process and IT outsourcing services
through one of its company, ACS, which it acquired in February 2010.
The company primarily operates in the US. It is headquartered in Norwak, Connecticut
and employs 53,600 people. Xerox has a proud tradition of pioneering research and
continues to be in the forefront of innovation. Chester Carlson's invention of xerography,
more than 70 years ago was an extraordinary milestone in the development of the modern
information age as now individuals could much more easily share and access information.
In addition to shedding unprofitable businesses and lines of business, and eliminating tens
of thousands of workers from the workforce (which was reduced by one-third from the
beginning of 2001 to the end of 2003, from 92,500 to 61,100), Xerox vastly improved its
balance sheet. During 2002 a $7 billion line of credit was successfully renegotiated, while
the following year saw the completion of a $3.6 billion recapitalization plan that included
public offerings of common stock, the issuance of convertible preferred stock, and the
securing of a new $1 billion credit facility. Total debt was reduced from $18.64 billion in
2000 to $11.17 billion in 2003. Perhaps most importantly, Xerox moved aggressively to
regain lost market share by introducing 38 new products during 2002 and 2003 as well as a
wide range of new document-related services. The product line placed particular emphasis

2. INFORMATION SYSTEM, ORGANISATION AND STRATEGY IN
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on digital and color copiers and enhanced multifunction devices capable of printing,
copying, scanning, faxing, and e-mailing.
Through Mulcahy's able leadership and dogged pursuit of a turnaround, Xerox was able to
post strong results for 2003. Net income of $360 million was the firm's highest profit level
since 1999. Xerox's stock rebounded in 2003 and 2004, although it remained well below
the levels of 1999 and early 2000. Debt was reduced further during 2004 to less than $10
billion, and the now cash-rich company was poised to begin pursuing acquisitions again.
From the real possibility of bankruptcy when she took over, Mulcahy had engineered at
least the beginnings of a remarkable comeback, though the competitive environment
showed no sign of becoming less brutal.
Principal Subsidiaries: Palo Alto Research Center Incorporated; Xerox Credit
Corporation; Xerox Financial Services, Inc.; Xerox Canada Inc.; Xerox GmbH
(Germany); Xerox Limited (U.K.). The company also lists some 250 additional
subsidiaries in the United States, Canada, Mexico, Argentina, Brazil, Chile, Colombia,
Costa Rica, Dominican Republic, Ecuador, Guatemala, Haiti, Honduras, Nicaragua,
Panama, Peru, Venezuela, Austria, Belgium, Bulgaria, Czech Republic, Denmark,
Finland, France, Germany, Greece, Hungary, Ireland, Italy, Luxembourg, the
Netherlands, Norway, Poland, Portugal, Romania, Russia, Slovenia, Spain, Sweden,
Switzerland, Turkey, Ukraine, the United Kingdom, Yugoslavia, Egypt, Morocco, China,
India, and elsewhere.
Xerox has a rich history of innovation. As the inventors of Ethernet over 30 years ago,
they helped build the foundation for today's Internet.

3. INFORMATION SYSTEM, ORGANISATION AND STRATEGY IN
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Business Financial Performance
ROCHESTER, N.Y. – Xerox (NYSE: XRX) continues to lead in global market share
for managed print services (MPS) and basic print services, (BPS) according to IDC’s
Worldwide and U.S. Managed Print Services and Basic Print Services 2012-2015 Forecast and
Analysis report [1].
The IDC report projects the industry will grow at an annual rate of 11.7 percent, and ranks
Xerox in the top spot for both MPS and BPS offerings.
“Xerox holds the lead in global market share for both MPS and BPS, with different offers
tailored to different sized businesses,” said Holly Muscolino, research director at IDC. “As
the industry expands into the Small & Medium-sized Businesses (SMB) market, consistent
global delivery capabilities are key differentiators for Xerox, and they continue to build out
their infrastructure for global support, including support for indirect channel partners.”
TOKYO, September 25, 2012 — According to the report issued from an information technology
research firm International Data Corporation Japan (IDC Japan), "Japan Managed Print
Services 2012–2016 Forecast and 2011 Analysis” Note 1, Fuji Xerox Co., Ltd. won the largest
market share in Japan---64.4% by sales ---in Managed Print Services (MPS) for 2011. IDC
Japan reported that the size of the domestic MPS market was 29.52 billion yen in 2011, an
increase of 19.3 percent from the previous year. The market is expected to grow steadily,
with an estimated Compound Annual Growth Rate (CAGR) of 15.5 percent between 2011
and 2016.

4. INFORMATION SYSTEM, ORGANISATION AND STRATEGY IN
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RANK XEROX
FINANCIAL PERFORMANCE
5 YEARS PERFORMANCE REVIEW FROM 2006 TO 2010
In millions of
dollars 2010 2009 2008 2007 2006
Total Revenues
21,633.00 15,179.00 17,608.00 17,228.00 15,895.00
Net Income
606.00 485.00 230.00 1,135.00 1,210.00
Total Assets
30,600.00 24,032.00 22,447.00 23,543.00 21,709.00
Total Debt
8,607.00 9,264.00 8,384.00 7,464.00 7,145.00
Return on
assets ratio
(R.O.A) 0.02 0.02 0.01 0.05 0.06
Assets
turnover ratio
0.71 0.63 0.78 0.73 0.73
Asset to debt
ratio 3.56 2.59 2.68 3.15 3.04
Current
Asssets 8,639.00 9,731.00 8,150.00 8,540.00 8,754.00
Current
Liabilities 6,417.00 4,461.00 5,450.00 4,077.00 4,698.00
Current Ratio 1.35 2.18 1.50 2.09 1.86
Gross margin 34.4% 39.7% 38.9% 40.3% 40.6%

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Summarily, although the net income has reduced drastically over the years, its net profit
was $606 million in the Year 2010 compared to a net income of $ 485 million in the Year
2009, a substantial increase of 25% from the previous year 2009.
Noticeably the gross margin has decreased consistently over the previous years from
40.6% in the year 2006 to 34.4% in the Year 2010
Total debt although has increased over the years from $7,145million in the Year 2006 to
$9264 million in the Year 2009, an overall increase of 29.66% from Year 2006 to Year
2009, however there was a significant decrease in debt from $ 9,264 million in Year 2009
to $ 8,607 million in the Year 2010, a decrease of 7.09% from 2009 to 2010.
The company also recorded revenues of $ 21,633 million in the Year 2010 and $ 15,179
million in the Year 2009, a major increase of 42.52% for this period. Interesting to note is
also that the company also recorded revenue of $17,608 million in the Year 2008, however
this dropped in the Year 2009 to $ 15,179 million, a significant drop of 13.8% over the
Year 2008.

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Here’s a summary of how they performed:
 Total revenue for 2015 was $18,161 million and for the Year 2014 it was $ 19,540 million,
down 8 percent from 2014.
 Net income for 2015 was $ 552 million and for the Year 2014 it was $ 1,128 million , down 51
percent from 2014
RANK XEROX
FINANCIAL PERFORMANCE
5 YEARS PERFORMANCE REVIEW FROM 2011 TO 2015
In millions of
dollars 2015 2014 2013 2012 2011
Total Revenues
18,161.00 19,540.00 20,006.00 20,421.00 20,638.00
Net Income
552.00 1,128.00 1,139.00 1,152.00 1,219.00
Total Assets
24,817.00 27,658.00 29,036.00 30,015.00 30,116.00
Return on
assets ratio
(R.O.A) 0.02 0.04 0.04 0.04 0.04
Assets
turnover ratio
0.73 0.71 0.69 0.68 0.69
Total Debt
15,351.00 16,556.00 16,268.00 18,002.00 17,742.00
Asset to debt
ratio 1.62 1.67 1.78 1.67 1.70
Current
Asssets 6,685.00 8,874.00 8,511.00 8,273.00 7,912.00
Current
Liabilities 5,254.00 6,076.00 5,686.00 5,910.00 6,381.00
Current Ratio 1.27 1.46 1.50 1.40 1.24

7. INFORMATION SYSTEM, ORGANISATION AND STRATEGY IN
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 The current ratio for 2015 was 1.27, and in the Year 2014 it was 1.46, down 13 percent from
2014
 Assets turnover ratio for 2015 was 0.73, and in the Year 2014 it was 0.71 up 3 percent from
2014
 Return of asset ratio for 2015 was 0.02, and in the Year 2014 it was 0.04, down 50 percent
from 2014
 Noticeably to note is that from the Year 2011 to the Year 2015 the total assets reduced from
$ 30,116 million in the Year 2011 to $ 24,817, in the Year 2006, an overall decrease of 17.6%
over this period.
In 2015, they delivered strong capital returns despite pressures stemming from global economic
uncertainty, weakened currencies, and the effect of lower revenues and operating margins from
challenges in several of our businesses.
They are redefining the future of print technology through innovations like printed electronic labeling
that improves product security and enables data collection throughout the supply chain. They are
seeing high interest in this technology from segments such as pharmaceuticals where product
authenticity is a growing problem.

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Notes: S&P Index is a benchmark.
Graph assumes $100 invested on December 31, 2005 in Xerox Corp., the S&P 500 Index and the
S&P 500 Information Technology Index, respectively, and assumes dividends are reinvested.
 Total return to shareholders (Year ended 31 Dec. - - - all in $)
(Includes reinvestment of dividends) 2010 2009 2008 2007 2006
Xerox Corporation 83.61 60.34 55.37 110.80 115.70
S&P 500 Index 111.99 97.33 76.96 122.16 115.79
S&P 500 Information Technology
Index
127.77 115.95 71.70 126.10 108.42
Both the graph and the total return to shareholders analysis for Xerox Corporation is
below the benchmark values which may affect the company’s performance (although the
figures are not too far behind) but as at 2006, they were able to meet up with the
benchmark.
0
20
40
60
80
100
120
140
Category 1 Category 2 Category 3 Category 4 Category 5 Category 6
Xerox
S&P 500 Index
S&P 500 IT Index

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 Xerox market share –versus - Others for the year 2010, starting from the best.
Vendor Total %
Canon 419,255 18.6
HP 388,475 17.2
Brother 325,544 14.4
Ricoh 252,214 11.2
Xerox 197,487 8.7
Lexmark 108,451 4.8
The financial performance of Xerox is 5th
out of 17 competitors including those above.

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SWOT ANALYSIS
LOCATION OF FACTOR TYPE OF FACTOR
Favorable Unfavorable
Internal
Strengths
 Market position in
document technology.
 Business model
transformation into
services business
 Annuity model and
strong cash generation
 Strong brand image
 Strong R&D capability
 Wide product
portfolio
Weaknesses
 Weak financial
performance
 High dependence
upon mature markets
 High dependence on
third parties
 Litigations
 Poor customer
relationship.
 No proper marketing
channels and strategies
 Less promotional
campaigns
 After sales services are
not customers
satisfactory
External
Opportunities
 Significant
acquisitions and
Expansion in SMB
markets
 Color peripherals
market
 Services poised to
capture growth in
cloud, mobility and
analytics
Threats
 Intense competition
from HP, Canon Inc
& Ricoh Company
 International business
risk
 Fast moving
technology
 Macro-economic
headwinds impacting
business spending

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GLOBAL PERSPECTIVE 11
Optimizing Our Portfolio
2015 also was a year that was distinguished by a number of key actions they took to optimize and
position our portfolio for the future. These decisions were made to create more focus in markets
where Xerox can differentiate its offerings and exceed client expectations, all in service of
improving operating performance and increasing shareholder value. Here are some examples:
• They sold our Information Technology Outsourcing (ITO) business to Atos, an international leader in
IT services. The transaction resulted in a greater focus on our Business Process Outsourcing and
Document Outsourcing businesses. It also enabled us to partner with Atos on developing solutions
for our customers that leverage Atos’ world-class ITO capabilities.
• They restructured our government healthcare business to increase our focus on higher margin,
growing segments like medical and pharmacy benefits management, and fraud and abuse detection.
They also reduced our participation in certain Medicaid platform implementations that were
presenting unattractive levels of risk and exposure.
• Our Document Technology business successfully refreshed its product portfolio by introducing nine
new products. Notable among them was the Xerox Rialto® 900 Inkjet production color press. It sets a
new standard in production volume and efficiency while offering the smallest footprint of any inkjet
press on the market.
• Selective acquisitions remained a key lever for short- and long-term growth. An example is our
acquisition of Healthy Communities Institute that strengthened our leadership in healthcare analytics.
Its leading cloud platform puts socioeconomic and community health, information at the fingertips of
hospitals, public health agencies and community coalitions.
A New Path Forward for the Year 2016
On January 29, 2016, they announced our plans to separate into two independent companies: one
comprising our Document Technology and Document Outsourcing businesses, and the other our
Business Process Outsourcing business. Both will be significant Fortune 500-scale companies and
leaders in their markets:
• The Document Technology company will continue to be the global leader in a $90 billion market
with a presence in approximately 180 countries. It will include our Document Technology and
Document Outsourcing businesses. Together, they generated $11 billion in revenue

12. INFORMATION SYSTEM, ORGANISATION AND STRATEGY IN
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in 2015. This business is the equipment share leader, and its managed print services offerings are
widely recognized as best-of-breed by industry analysts.
• The Business Process Outsourcing (BPO) company will continue to be a leading enterprise for the
next generation of BPO. In 2015, this business generated $7 billion in revenue. It has the second-
largest market share in an industry that is rapidly expanding, with notable growth opportunities in
healthcare, transportation, the public sector and a range of other industries.
They are confident this is the best way forward for our shareholders, clients and employees. With
increased strategic focus and financial flexibility, they can capitalize on the unique strengths of our
Document Technology and BPO businesses and capture the value-creation opportunities that they
see in each of them.
For customers and partners, each company will maintain its leading service delivery and innovation
excellence. But they will be able to more quickly respond to market forces and client needs through
simplification, greater focus and agility. Our employees will benefit from working for industry leaders
with leaner structures, faster decision making and improved growth opportunities. Investors will
benefit from two distinct investment opportunities, each with an enhanced focus on long-term
growth and profitability. They expect the separation to be completed by the end of 2016.
Conclusion
From the above analysis, it shows that Xerox Corporation has been in business for a long
while and therefore has been performing well as regards to its image, business
performance, research and development but fails to improve as regards its financial
performance. This may negatively affect the company in future performances and survival
in its industry hence in the Year 2016 it is plans are to separate into two independent
companies: one comprising our Document Technology and Document Outsourcing businesses, and
the other our Business Process Outsourcing business. For customers and partners, each
company will maintain its leading service delivery and innovation excellence. But they will be able to
more quickly respond to market forces and client needs through simplification, greater focus and
agility. Our employees will benefit from working for industry leaders with leaner structures, faster
decision making and improved growth opportunities. Investors will benefit from two distinct
investment opportunities, each with an enhanced focus on long-term growth and profitability. They
expect the separation to be completed by the end of 2016.