Xerox: Adapting to the Turbulent Marketing Environment
Q1 & Q2.) What microenvironmental/macroenvironmental factors have affected Xerox’s performance since the late 1990s?

For many decades after its inception Xerox as a company faithfully understood its own identity, and was highly successful in the photocopying industry that it created. Around the late 1990’s a shift in the industry began to occur, as business transitioned away from the need for exclusively physical copies of documents, moving many of these files into digital databases. The internal culture of Xerox did not entirely comprehend the implications of these changes as they began to occur and subsequently did not adapt to meet their clients new needs fast enough. The resulting aftermath was that Xerox’s market capitalization fell dramatically, from an exceedingly valuable business just a few years earlier, to the point where the business was on the brink of bankruptcy.

To combat the rapid decline of profitability, the internal environment of the company needed restructuring, and the focus of the entire organization was required to change. The workforce was nearly halved to 55,000 people resulting in a return to profitability within a reasonable timeframe, and concurrently a new direction was identified. Xerox acknowledged the needs of their customers in adopting their new document management and services focus, much of this approach involved delivering more value to their customers by reducing the cost of consolidating documents. Although it was a slower process than was ideal, with these changes implemented Xerox ultimately overcame these pressures that were threating to eliminate it entirely from the corporate landscape.

Having overcome these aforementioned pressures and returning to what could be considered an optimistic and robust position, Xerox again found itself challenged, this time due