Lessons from the Fall of Xerox

The downfall of Xerox is a tale of technological change, management failure, and board irresponsibility. Some $38 billion in shareholder wealth has been destroyed in less than two years. The tragic fall of this icon presents important lessons for every company trying to find its way in the new Information Economy. The most important? If you bring in a change agent, allow the person to make changes. These may or may not succeed, but anything less will lead to disaster (page 82).

Xerox, like IBM, Hewlett-Packard, General Electric, Siemens, and dozens of other corporations around the world, is struggling to make the transition from selling high-tech boxes to selling high-tech solutions and services. It finds itself losing market share to Japanese rivals in its old business, yet is unable to find a profitable place in the Net-centric digital world. For some time, Xerox has clearly needed a new vision.