Xerox's Mulcahy: We're Moving Beyond Documents

Xerox chairman and CEO Anne Mulcahy says she wants her "document company" to become more like an IT-services firm and develop more offerings through which it can help customers streamline back-office operations and make their knowledge workers more efficient.

In an interview Tuesday, Mulcahy said Xerox's future hinges in part on how well the company can move beyond printing hardware and related services and into more nebulous--but potentially lucrative--office automation, content management, and business-consulting services.

"It's a bigger agenda, and I think we have a lot more to offer," she said.

In essence, Xerox wants to be the vendor that big companies turn to when looking for help managing and making sense of the vast quantities of digital information that flow through their corporate networks.

"We began the digital market from the output sense, so we've been there. We feel we have permission to play in the whole document-management services space," Mulcahy said.

To bolster the effort, Xerox is stocking up on consulting talent. In April, the company chose Capgemini veteran John Kelly to lead Xerox Global Services. Kelly, in turn, has been on the hunt for business technologists with broad experience in numerous vertical industries.

"We're bringing in CIOs from across the spectrum," says Kelly.

Xerox also is introducing new products to support the strategy. Tuesday, for instance, the company unveiled software designed to help public companies better meet regulatory requirements by improving their document archiving and retrieval capabilities. Xerox says the software, DocuShare 4, will help people more effectively manage content ranging from E-mail to HTML pages.

Mulcahy said Xerox's sales of higher value "innovation" services have increased 20% in the first six months of 2004. She added that she believes fully half of Xerox's revenue--which stood at $15.7 billion in 2003--could flow from services "over the next few years."

The strategy may be paying off. Tuesday, the company announced that it has signed multimillion-dollar deals with financial-services company HSBC and aerospace manufacturer Boeing. Under its $23 million deal with HSBC, Xerox will provide imaging equipment, services, and support for the bank's offices in Brazil and the United Kingdom. Terms of the Boeing contract were not disclosed.

Xerox says that it prevailed over Hewlett-Packard and IBM in winning the HSBC contract. Still, analysts say the company could have a tough time competing against large, traditional IT vendors as it seeks to broaden its share of corporate spending on information-management services. Mulcahy wouldn't rule out acquiring services firms to meet that challenge. "We'll consider partnerships, alliances, and acquisitions," she said. "We'll consider all of that to take advantage of this market opportunity."