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 user 2009-05-27 at 11:34:57 am Views: 64
  • #21942
    Xerox’s Burns Takes Reins During ‘Daunting’ Time
    May 09– Xerox Corp.’s Ursula Burns, who takes the reins at the world’s largest high-speed color printer maker in less than six weeks, has a mandate: getting budget-cutting customers to increase spending on office equipment.Burns, 50, will become chief executive officer on July 1, ending the eight-year run of Anne Mulcahy, who will stay on as chairman. Mulcahy, 56, named Burns president in 2007, almost three decades after Burns joined Xerox as a summer intern.Burns, who will be the first black female CEO among Fortune 500 companies, has to work on maintaining Xerox’s cash flow and improving the product line, said John Engler, president of the National Association of Manufacturers, where Burns served as a director. Her promotion follows two straight quarters of sales declines amid the worst economic slump in more than 50 years.“It’s a very daunting time to be a businessman in America,” said Engler, who met Burns in 2004. “Ursula brings a real set of skills. She’s creative, very direct. This will be a very peaceful transition.”Burns, who has a master’s degree from Columbia University, joined Norwalk, Connecticut-based Xerox in 1980 with an interest in mechanical engineering. Since then, she has run different divisions including product development and marketing.“The succession plan has been in the making for several years and Xerox is as prepared as it can be,” said Angele Boyd, a vice president at research firm IDC in Framingham, Massachusetts. “The strategy in place is very sound.”

    Sales Decline
    Global technology spending may fall 3.7 percent this year as companies curb outlays, research firm Gartner Inc. projected.Xerox, which avoided bankruptcy earlier in the decade with Mulcahy’s cost-cutting measures, posted a 30 percent drop in sales from equipment and other hardware last quarter. Such sales are an indicator of future demand for paper, toner and other supplies, which make up about four-fifths of revenue.Still, the company posted net income of $49 million in the latest period, its fourth-straight quarterly profit, after slashing administrative expenses 11 percent. The company’s full- year profit forecast met analysts’ estimates.“The market is definitely softer today,” Burns said in an interview earlier this month. “There are less buying decisions, but many, many still going on.”Burns will be one of about 15 women who lead Fortune 500 companies and her ascension will mark the first female-to-female transition, according to Fortune. Her promotion cements her status as the most powerful black woman in the corporate world.She’s been to business what “Condi Rice is to politics,” said Engler.

    Mulcahy’s Tenure
    Xerox will focus on color printing, especially solid-ink printing, and selling document services to drive revenue, Burns said in the interview. This month, the company released its first color printer for large enterprises that uses solid ink, which can cut the price of a color page by almost 90 percent.In 2000, the bursting technology bubble left Xerox with mounting debt and its first annual loss in five years. The stock plunged 80 percent as former CEO Richard Thoman exhausted the company’s $7 billion line of credit. Mulcahy took over in 2001, and doubled the share price during the next three years.

    Xerox stopped making personal copiers and started focusing on laser printers, as well as color printing. Mulcahy also cut at least 20,000 jobs, helping to boost sales and lower long-term debt to about $10.8 billion last year from more than $18 billion in 2000. She also reinstated the company’s quarterly dividend in 2007, after it was discontinued in 2001.Xerox fell 4 cents to $6.78 at 4 p.m. in New York Stock Exchange composite trading. It has dropped 15 percent this year.Burns helped her turn the company around and is ready to lead Xerox in a tough economy, Mulcahy said yesterday at the annual shareholder meeting in Norwalk.“There is no doubt in my mind that she is the right person and that this is the right time for her,” Mulcahy said.