ABSTRACT
Most people have heard of Xerox, the company that invented the paper copier and for a time one of America’s best-known corporate names and employer of 100,000 people.1 Like so many successful companies, however, it has had its share of struggles-both in maintaining market share and even staying in business. In the early 1980s, Xerox executives realized that if something radical was not done, Xerox probably would not survive to the end of the decade. The problem: Japanese companies were selling copiers for less than it cost Xerox to make them, and they had targeted Xerox to capture its market and wipe it out altogether. For Xerox the situation was dire: Its market share was less than 15%, down precipitously from the more than 90% share it had enjoyed a decade earlier. But the competition alone was not the cause: there was no quality control to speak of, overhead and inventory costs were excessive, and there were too many managers. Further, Xerox had lost touch with its customers and was not giving them the products or service they wanted. At one time Xerox had no competitors. Now it had many, and customers were flocking to them.
