Results tagged “Xerox”

Xerox announces 2,500 job cuts with services arm taking biggest hit

Karl Flinders
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As exclusively revealed on this blog last month Xerox is cutting its workforce.

A US website has reported that Xerox officials have confoirmed there will be about 2,500, cuts but does nt reveal any of the finer details apart from that the services arm will take the biggest hit.

This blog has already revealed a bit more. Computer Weekly understands the European services arm of Xerox is letting sales and pre sales teams go as well as the leadership in a bid to save $18m to contribute to an overall Xerox target of reducing costs by hundreds of millions of dollars.

A source that knows the situation said that Xerox is not going for growth in its European services business but wants to protect the business it already has.

Xerox's European services business includes IT outsourcing, financial services BPO and HR outsourcing.

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Xerox European services cuts in more detail

Karl Flinders
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I have been blogging since yesterday about Xerox Europe's plans to cut costs in its services business.

The company has admitted that it is restructuring in Europe since this blog broke the story and I have been told a bit more from a couple of sources of mine.

There are currently lots of salespeople from Xerox's European Services business looking for work as the company lets lots of them go. It is also making senior leaders redundant.

It seems things are tough in Europe and Xerox is not even looking at making new sales but wants to protect the business it has. And it wants to cut $300m costs globally with the European services business contributing savings of $18m.


If you are affected by the Xerox cuts please give me your thoughts.
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Is Xerox's European services plan in tatters and is ACS to it what EDS is to HP?

Karl Flinders
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Xerox's plans to grow its services business in Europe could be in tatters. A source told me it is about to lay off lots of people.

This is the Xerox that acquired US IT and business process services giant Affiliated Computer Services (ACS) for billions of dollars in 2009.

The firm gave Xerox a services footprint in over 100 countries from 500 locations.

Speaking at the time Xerox CEO Ursula Burns said the deal was "a game-changer for Xerox". "By combining Xerox's strengths in document technology with ACS's expertise in managing and automating work processes, we're creating a new class of solution provider," she said. Xerox wanted to use its brand to grow ACS's business outside the US with a strong focus on Europe.

But according to a source close with good knowledge of the company it is about to retrench in Europe and lay off lots of people.

Xerox like HP, with its EDS acquisition, and Dell, with its Perot Systems acquisition is a hardware giant attempting to expand into services. We all know that HP has halved EDS's market value since its take-over in 2008.

Do hardware firms and services suppliers have incompatible DNA?

Tell me what you think.
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Can Xerox/ACL do well in European outsourcing?

Karl Flinders
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The unlikely marriage between IT hardware suppliers and IT service providers was probably hard to fathom a few years ago. But today it is common practice.

We all know about the take-over of EDS by HP and Dell's acquisition of Perot Systems is also well documented. There is an argument that these companies are turning outsourcing into a commodity.

But the rabbit in the European IT services hat could be the Xerox and ACL tie up. ACL does not have a large footprint in Europe, but Xerox does.

The interesting thing for me is that Xerox has a large footprint in the SME market as well as the corporate sector.

Xerox wants to be a giant of document and business process outsourcing. It plans to grow its sales by leveraging its brand and customer base to boost ACS's business in Europe, Asia and South America.

A contact in the outsourcing sector I met up with last week thinks it has the right brand to do this in Europe. It also has a good opportunity in the SME market which is hard to serve for the traditionally corporate focussed suppliers. Mind you Dell/Perot would say the same thing.

HP's $1bn technology investment reflects customer demand

Karl Flinders
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Forrester analyst John McCarthy describes how HP's datacentre rationalisation process, which will lead to 9000 job losses, is a refection of how the market is moving.

He says suppliers are moving away from custom offerings because customers are demanding software as a service and prices are dropping.

"HP is applying the lessons learned from their own data center rationalisation process to EDS and its customers," he says. "In the long term, this is indicative of the market's movement away from custom offerings in the light of 'as-a-service' pricing and deflation."

Will this shift benefit the big product based companies that have acquired specialist service providers? They can use their skills to build infrastructures that can support the move to commoditised services.

As well as HP's acquisition of EDS in 2008, Dell bought Perot Systems for $3.9bn and Xerox spent $8.7bn provider Affiliated Computer Services (ACS) last year.

Will technology play a more important role in IT outsourcing, as IT as a service grows, while people and relationships take a back seat?

Does this leave gaps in the market for the mid sized suppliers?

Are acquisitions good for outsourcing sector?

Karl Flinders
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I wrote a story recently about what mergers and acquisitions in the IT sector mean to CIOs.

It talked about how large suppliers can take technologies to the next level.

The story mainly focused on IT manufacturers but what about in the outsourcing sector?

Three of the biggest IT acquisitions last year were Xerox buying ACS and Dell buying Perot Systems. And lets not forget HP bought EDS a couple of years ago.

Big companies renowned for selling hardware taking over service providers. Will this work or hasten the commoditisation of IT outsourcing? And is this a good or bad thing?

HP has certainly had its problems integrating EDS, but it is making money.

Dell has bold claims about its ambitions in services but what will it deliver?

What are people's views on the Xerox acquisition of ACS?

How will these acquisitions leave the end user?

Will there be two tiers to the outsourcing industry?



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