1. Kerr [1994]; Rao [1995]; anonymous [1997]
Xerox
Kerr [1994];
Rao [1995];
anonymous [1997]

2. Xerox IT 1994 Xerox outsourced IT to EDS
10 year contract for $3.2 billion
Data center operations
Telecommunications
Desktop systems support
Maintenance of existing systems
New client/server projects

3. Impact Xerox had previously hired 2,700 in IS/IT Xerox retained
1,700 jobs moved to EDS
750 jobs retained at Xerox
250 jobs eliminated
Xerox retained
Architecture
Strategy
New program development

4. Financial Impact
Xerox had an operating profit of $620 million on $14.6 billion in sales
$620 million sounds pretty good
4% doesn’t sound so hot
Strategy: shed non-core business
Focus on strategically important business
Save $1.2 billion
Speed rate of moving into new technologies

5. Xerox IS/IT Part of massive reengineering effort Legacy system
Same principle as ERP (core business computing)
Process reported to be painful
Effort to deal with complex issues such as those addressed by ERP