Xerox restructures with 15% headcount cut
Published: 4 January 2024 | No comments yet
Xerox CEO Steven Bandrowczak spoke about software and services at the 2022 Premier Partner event in London
Xerox has announced a restructuring that involves moving to a ‘business unit operating model’ under which there will be ‘improvement and stabilisation’ of the core print business, the formation of a new global business services organisation, and increased focus on the company’s digital and IT services. It is also expecting to shed some 15% of its workforce and has already seen the departure of senior figures.
Branding the changes as a ‘reinvention’, Xerox CEO Steven Bandrowczak said in a Xerox statement, ‘The shift to a business unit operating model is a continuation of our client-focused, balanced execution priorities and is designed to accelerate product and services, go-to-market, and corporate functions’ operating efficiencies across all geographies we serve.’
Within the core print business, the plan is to simplify the product range while increasing investment in a ‘partner-enabled go-to-market model’ and the pursuit with partners of ‘strategic market share gains’ by means of ‘increasing reach, improving cost to serve, and enhancing profitability’. What this means for Xerox’s offerings in the commercial print sector is not clear, but it is perhaps noteworthy that no significant new product introductions have been made here since the 2019 launch of the Baltoro sheet-fed inkjet press, following 2018’s launch of the popular Iridesse six-colour dry toner production press. The Baltoro was updated in 2020 to increase its substrate flexibility via an additional drying unit, and new low-end and mid-production toner presses introduced.
At Hunkeler Innovationdays 2023, Xerox was the only digital press vendor present not to have a digital web press, having retired the Trivor and Brenva models and showing only the Baltoro. Further to the ending of the Fuji-Xerox agreement it no longer has exclusivity on the Iridesse platform, which was manufactured under the joint agreement and now faces competition from Fujifilm’s own Revoria line, which became available in the UK in April 2023.
The new Global Business Services unit is described in vague terms but appears to be targeted predominantly at existing corporate and enterprise customers. It too seems to be relying on simplification and lowered transaction costs, with generic promises about improving quality for both clients and employees via continuous improvement.
The IT and digital services unit is intended to ‘accelerate revenue diversification toward markets with higher growth and profitability profiles’. This presumably builds on the Care AR and related software products that were introduced in 2022 and which were featured at Hunkeler in February 2023, along with FreeFlow Vision workflow and analytics software. In an autumn 2022 presentation, Mr Bandrowczak also noted that AI techniques which had already been implemented in the Baltoro press would be further diversified into support for production printing. It is not clear if this will continue; nor is it immediately apparent where the July 2022 acquisition of direct mail specialist Go Inspire sits within the new structure.
Darren Cassidy, managing director UK & Ireland, and SVP EMEA enterprise at Xerox, told Digital Printer, ‘With our new operating model, we will simplify our print offerings and stay aligned with what our clients are solving for in today’s workplace, whether that be home, office or production print environments. That also includes investments in software and services to pursue strategic market share gains and increase reach with partners, while reducing costs and improving profitability.
‘For more than a century, Xerox has been a technology pioneer, continually redefining the workplace experience. As our business evolves, we will continue to prioritise innovation and deliver the best possible hardware, software, and services for our clients and partners.’
To support the new model various changes in the leadership team at Xerox have been made. Effective immediately, John Bruno, president and CEO, will lead the enterprise alignment of the print, digital services, and IT services businesses. Louie Pastor returns to Xerox as chief transformation & administrative officer, charged with overseeing the Xerox Reinvention Office and the newly-established Global Business Services organisation. Tracey Koziol, executive vice president of Global Offering Solutions and chief product officer who had responsibility for the professional print products, left at the end of 2023.
A 15% worldwide workforce reduction is expected to be implemented in the first quarter of 2024. No information was provided on how or where these job cuts will be made.