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Author: themeateater Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 3605  
Subject: Re: XRX Article at Smartmoney.com Date: 7/30/2000 9:19 PM
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Awaryfool - Good piece, don't be sorry, post away. I'd rather see a an article like this twice, than miss it.

Saying all that - I get really pissed off when I read a piece like this.
______________________________________________________________________________

"I don't see any silver-bullet type of solution," he says. "Xerox has to do two things: re-establish an effective U.S. sales force and take back market share at the high end. There's a lot of work to be done." One strategy: Xerox reportedly will bump up its sales incentive plan to better reward its rainmakers, taking a short-term earnings hit for the long-term benefit of happier salespeople. These days, after all, the sales force is more demoralized than Joe Piscopo's agent.
...........


The comments about a lot of hard work are missing the big point. Things are not working right, and they haven't for awhile. The Mexican deal stinks! Sounds like the administrative changes were the right thing to do but they were bungled! The sales force changes may have been the right thing (or the wrong thing) but they were also bungled! Thoman was may be the wrong man, but he didn't do this much damage by himself! Big changes are needed. IMO - Paul Allaire and Barry Romeril (for his failure to police Mexican Accounting) should go, along with a couple of thousand managers who helped bring us to this current state of affairs.

Regarding the happy salespeople. People who work for me buy XRX equipment (and HP equipment as well). As a customer I could care less if the salesman are happy. As a matter of fact, I would be very happy to order all my XRX equipment over the internet (especially with the e-mail support of a good tech rep).

IMHO - The most important XRX people to my organization are the service people. We talk to the salesperson once every two years. We see the service people all the time & when XRX service has problems I hear about it. So my priority list for happy XRX people are:

1.) XRX Customers
2.) XRX Service People (who make XRX Customers happy)
3.) XRX Shareholders
4.) Then everyone else at XRX can be happy.

BTW - If I could I would order my next group of copiers directly from the service person. I betcha those pumped up commissions would make him happy, and I'll get top notch service.
_________________________________________________________________________

J.P. Morgan analyst Daniel Kunstler stands alone in his undaunted bullishness. Back on June 19, when Xerox shares were at $20.75, he called them "cheap to the point of being a little ridiculous." Thursday, he
remained upbeat. "We are maintaining our Long-Term Buy rating, as we continue to believe that the Xerox franchise has considerable staying power," he advised clients. "A franchise such as Xerox's does not dissolve that quickly. ............."


I agree with Kunstler, but only if we change top management. If HP doesn't want XRX, may be some other company with top heavy management would want it. GE's got three world-class Execs in the running for the top spot(someone isn't going to be happy, so GE could buy XRX as a consolation prize). I mentioned Eric Schmit (from NOVL) a few weeks ago. What about Ray Lane from Oracle. If we don't want to go outside, then get Paul out of the way and give Anne a clear field. BTW - after the way Thoman was canned I'm sure no top notch non-XRX exec is going to take the job unless Allaire is out of the picture.

______________________________________________________________________

Or does it? Since June 1, Xerox shares have lost just under half their value. The company's market cap is now less than $10 billion. Its price-to-book ratio is 2.18, a five-year low, compared to a high of 8.66. Such facts lead some, including legendary former Xerox supersalesman Frank Pacetta, writing in Business Week last month, to view Xerox as an attractive takeover target. Hewlett-Packard (HWP), which rules the printer market, is touted as the most likely buyer, since a combined Hewlett-Xerox colossus would dominate the entire imaging business. And since Xerox's biggest problems are clearly managerial, a new team might be able to whip it into shape in short order.

A merger or acquisition, of course, could mean a nice bump in share prices.


No problem here about a nice bump in share prices. I wonder if XRX mangement feels the same way - join forces with HP? My guess is that they would fight it tooth and nail.


Bruno the Meateater


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