Major Reorganization Underway at Xerox with Updates
Last month, following Xerox’s announcement In October 2018 of some planned 900 layoffs worldwide, we reported that the company had eliminated various management positions in internal IT operations, as well as various positions in finance. (See “Updates” below for latest developments.)
Today, CRN reports that Pete Peterson, president of the Xerox Channels group, has left Xerox, and that several other leadership positions have been reorganized.
Peterson, a former Tech Data executive who joined Xerox in 2017, confirmed his departure. He told CRN that given the upheaval during his time with Xerox – including the on-again-off-again proposed purchase of Xerox by Fujifilm and the ouster of former Xerox CEO Jeff Jacobson and various Xerox board members – “he always viewed his role there as temporary, so he tried to find the right talent and organize his team as best he could.”
Peterson is said to have left Xerox about a week ago, and says he plans to launch a consulting company called Navion Solutions Group.
According to two internal memos obtained by CRN, last month, Xerox realigned its leadership into two groups: the Americas Operations and EMEA (Europe, Middle- East, Afriac). Leading the Americas operation is Mike Feldman, who is currently president of Xerox North American operations. Feldman will now oversee the United States, Canada, Mexico, and Central and South America.
Xerox CEO John Visentin is said to have written in a December internal memo: “These changes reflect a closer alignment with industry standards and the way our customers expect to buy and be serviced, making it easier for them to do business with us. At the same time, we are optimizing our operations. This will create a simpler, flatter, more agile organization that will help empower our people and make it easier to speed decisions into action on behalf of our customers, as well as create ways to work more productively.”
Hervé Tessler, president of Xerox international operations, will lead EMEA Operations, Visentin wrote.
Before, partners had reported to their regional vice president, then to Rose Willis, who now leads the US Agent Team, then to Darren Cassidy, now the head of global supply, then to Pete Peterson, then to Feldman. Under the new structure, partners will instead report to their regional vice president, then to Willis, then to Feldman. The reorganization is said to have designed to create a faster, more streamlined process.
Xerox CEO Visentin is scheduled to discuss the changes on a phone call with partners tomorrow.
He wrote in one of the memos: “The changes in our go-to-market operations, Global Delivery and Global Supplies are significant steps towards achieving our vision of becoming a tech powerhouse and position us for a strong start in 2019. By removing complexity in the way we work, organizing more effectively, and creating greater customer focus, we will be able to improve our customers’ experience and drive even greater revenue opportunities for Xerox next year and beyond.”
According to CRN, which obtained a December 2018 letter from CEO Visentin to Xerox employees, other changes designed to make Xerox’s operations more efficient include:
- The operations unit has been consolidated under a single leader, Steve Bandrowczak
- All hardware has been moved under Tracey Koziol, who is now responsible for Xerox’s entire product portfolio
- Visentin created a new unit dedicated to software, which he called “an important future source of growth.”
- Business functions of HR, legal, finance, information management, delivery, strategy, and marketing have been centralized.
- Xerox may be considering various acquisitions, with Senior Vice President and Chief Strategy and Marketing Officer Farooq Muzaffar tasked with identifying new acquisitions that “will complement and extend our existing capabilities into new areas, while re-branding Xerox.”
- A new U.S. unit is responsible for production products, and is headed by Sean Hickey.
- Mary McHugh, a former Oracle and Hewlett-Packard Enterprise executive, was brought on board in June 2019 to oversee Xerox’s new global delivery strategy.
On January 15th, Xerox also announced that it’s re-branding its Global Imaging Systems as Xerox Business Solutions, or XBS (see here for more).
Overall, these changes shouldn’t be unexpected. Back in December 2017, activist Xerox investor Carl Icahn – who, together with Xerox investor Darwin Deason, was instrumental in derailing the Xerox-Fujifilm deal – has long been critical of Xerox management, resulting in the eventual resignation of former Xerox CEO Jeff Jacobson and several Xerox board members. Indeed, back in December 2017, Icahn wrote in a letter to the Xerox board that Xerox “desperately needs new leadership.” Icahn has also written that Xerox needs to become more streamlined and efficient, so that Xerox is easier to do business with. He has also questioned the role of Xerox’s Global Imaging Systems group, which owns a group of office-equipment dealers that sell not only Xerox, but competitor products, which Icahn has stated is “to the detriment of Xerox.”
In an April 2018 letter, Icahn published a “Detailed Presentation on Rescuing and Revitilizing Xerox.” The presentation argues that Xerox’s cost-cutting over the years has been “ineffectual” and Icahn critisized its “failure to develop a coherent, efficient, ecommerce and distribution network,” noting that its ecommerce and distribution is “confusing” and should be simplified.
In July 2018, newly appointed Xerox CEO Visentin also said Xerox will focus on making itself easier to do business with, and will focus on optimizing operations for simplicity, will come to market faster with new products, and of course will focus on increasing revenues and profitability. Visentin also said Xerox may consider revamping its product sourcing. Xerox has long sourced printers and copier/MFPs from Fuji Xerox, its joint venture with Fujifilm, but Visentin said at the time: “The company (Xerox) in the past has not seriously pursued other suppliers. But recently, we were successful in partnering with a supplier for a new product. Just because a supplier has had business with Xerox in the past does not guarantee future business.”
- December 2018: Layoffs Hit Xerox
- August 2018: Xerox Announces Job Cuts at U.S. and Canadian Locations
- July 2018: Xerox CEO Discusses Path Forward, Fuji Xerox, and Suppliers
- July 2018: Xerox Reports Second-Quarter Results, Addresses Fuji Xerox Partnership
- July 2018: Xerox May Sell Leasing Unit
- June 2018: Xerox to End Fujiflm-Fuji Xerox Partnership, Source Products from Other Vendors
- June 2018: Judge Refuses to Lift Injunction Barring Xerox-Fujifilm Deal
- June 2018: Fujifilm Sues Xerox for $1 Billion over Failed Merger Deal
- June 2018: Fujfilm May Walk Away from Xerox Deal
- June 2018: Fujifilm Sues Xerox Over Scrapped Sale and Merger
- May 2018: Xerox Calls Off Deal with Fujfilm, Will Install New Leadership