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Stocks X / Xerox Corporation
|Subject: Red Herring||Date: 7/20/2000 10:56 PM|
|Author: themeateater||Number: 1285 of 3612|
FYI - Article on integration after mergers. Highlights integration of XRX and Tektronics.
IMO - It also gives some interesting insights into XRX culture.
The integration game
Most mergers tank for one not-so-simple reason: too little effort toward company integration.
By Joan Indiana Rigdon; From the July 2000 issue; Red Herring Magazine
Last year, when Xerox announced its intention to buy the color printing business of Tektronix (NYSE: TEK), it also said that the acquired unit's chief, Gerry Perkel, would become the head of Xerox (NYSE: XRX)'s newly combined printing business. The release also named Mr. Perkel's boss, and his boss's boss. By making all this clear early on, Xerox was hoping to remove uncertainty. According to KPMG's study, merging companies who clearly outline the new management team right away are 26 percent more likely to increase shareholder value. ..............
To that end, when Xerox acquired the Tektronix unit, it announced that the merger wasn't just about expanding its copier business, but learning some new, nimbler business practices. And Xerox could use some: ........
"We were acquired for our DNA," says Duane Schulz, a former Tektronix executive who is currently vice president of new business ventures for OPB. "And part of the frustration is making sure not to let our employees copy the Xerox DNA."
That cultural transfusion will be extremely difficult. While Xerox likes to think of itself as a cornerstone of the new economy -- its press releases say Xerox invented the first personal computer and the graphical user interface -- its culture definitely hails from the old school. Suits and ties are de rigueur in Stamford, and casual Friday means you get to wear a sports coat. Tektronix, at age 53, is no startup. But its culture is decidedly left coast. In Wilsonville, Tektronix's former color printer workers wear Dockers and even jeans with holes. They live and die by email, while some of their Xerox counterparts go a week without checking.
As Xerox and Tektronix worked on combining their businesses, they learned just how different their cultures were. Sometimes it manifested in small ways, like on January 3, when Mr. Vester arrived in Wilsonville to celebrate the merger's close. He had met three of the Tektronix division's executives several times before, and they were wearing suits each time. So Mr. Vester wore his, only to discover that everyone else was dressed casual. He wanted to change, but his casual clothes were in his luggage, which had been delayed in Seattle.
That was easy