Strategic Analysis of Xerox

Introduction

This report will attempt to delve in an out of the storied history of the Xerox Corporation and discuss its strategic processes at different points in time. It will incorporate a discussion of the organisations eight emergent and deliberate characteristics as described by Mintzberg and Waters in their seminal paper, Of Strategies, Deliberate and Emergent released in the Strategic Management Journal in 1985.

Planning Strategy

Xerox’s entry into the Chinese market is an example of the Planning Strategy in Mintzberg and Waters deliberate-emergent continuum. In 1979 when China fully established diplomatic relations with the United States most large western global organisations saw the massive opportunity that this market represented. Xerox through its joint venture with Fuji Film had established Fuji-Xerox in the early sixties which gave it a unique understanding of the Asian market place. Formal, structured analyses such as environmental scanning, portfolio analysis and industry analysis used in the early stages of the strategy-formulation process to define opportunities and threats (Barbuto, 2002) were carried out at a much quicker pace than many of their rivals. This knowledge of Asian culture allowed Xerox to become one of the quickest movers into the market place and develop first mover advantages over its rivals. In 1985 Xerox established a joint venture with China Computer Systems Engineering Corp (CCSE) for an electronic printing centre in Beijing, the first such technology venture of any western organisation into China.

In 1995 Xerox China Ltd. was established to oversee marketing and production in China with Xerox’s stated goal to be the largest supplier of document products to the Chinese economy by the end of the century (Luo, 2001). As Xerox was the first copier organisation to arrange a joint venture in China it gained the advantage of faster access to markets and suppliers, also as the industrial standard bearer the company benefited from the customer loyalty that this brings. This in turn helped Xerox to be the number one supplier of document products by the year 2000 with over 45% of the market (Luo, 2001).

In order for planed strategies to become realised strategies it is best that the environments in which they exist in are stable and predictable (Mintzberg and Waters, 1985). While some may not agree with its policies, the Chinese governments control over large sections of the economy does act as a stabilising factor in regards to some elements of the business environment. This stability along with government enforced barriers to entry has helped Xerox to gain quite a large foothold in the market and achieve its plan of having a large interest in the Chinese marketplace.

Entrepreneurial Strategy

Xerox was first established as the Haloid Company a photocopier paper business in New York in 1906. In 1912 the company was sold to Gilbert E. Mosher who made himself president but retained the founders for the day to day running of the business. In 1933 Haloid brought a new high quality paper to market which was highly successful and ensured the company’s survival during the Great Depression (Encyclopedia.com, 2015).

An entrepreneurial strategy occurs when a strong leader successfully imposes a comprehensive business strategy throughout an organization. Xerox has had an experience of this kind of strategic process when  in 1935 Joseph Wilson, a son of one of the original founders of Haloid, decided the company should buy a photocopying machine manufacturer called the Rectigraph Company to open up new business opportunities (Company-histories.com, 2015). During World War II demand for high quality printing paper skyrocketed due to the reconnaissance needs of the Armed Forces and this had the effect of new competitors entering the photocopying paper market. Wilson knew that the company needed new products in order to survive in this new competitive environment. Despite the reservations of the owner Gilbert Mosher, Wilson entered into an agreement with a research organisation called the Battelle Memorial Institute and together they produced a xerography machine called the XeroX Copier. This copier completely revolutionised the Haloid Company business model and changed the face of the organisation forever eventually leading the company to change its name and become the Xerox Corporation.