As the chairman and CEO of Xerox, Anne Mulcahy was largely responsible for orchestrating what Money magazine called “the great turnaround story of the post-crash era.”
By keeping the company steadfastly focused on customers and employees, she was able to lead Xerox away from the brink of collapse to become one of the world's most profitable and innovative technology and service enterprises.
On Wednesday, Nov. 9, as part of the Dean's Innovative Leader Series, Mulcahy spoke at the Wong Auditorium and revealed some of the many leadership strategies that helped resuscitate the historic company.
Mulcahy explained that the Xerox turnaround provided her with an abundance of leadership lessons, and at the top of the list was that of listening. “Good leaders listen,” she said.
And the new perspectives she gained by actively listening to customers, shareholders, and employees at all levels of the company allowed her to pinpoint specific hidden weaknesses in the organization.
“So rather than wasting a lot of time putting out fires,” she said, “we were actually focused on the source of the fuel leak, which really became critically important to fixing the real problems.”
Mulcahy spoke of the importance of good management instincts. When organizations focus too intently on data and process, she explained, it can sometimes be a barrier to timely decision making.
In the 1990s, she said, Xerox had become a highly matrixed company, organized by product, geography, and segments. It all looked good on paper, but in reality, Mulcahy said, “it was a nightmare. You couldn't find anybody who had clear responsibility for anything.”
“Peeling it all back and creating clear accountability ... was a big part of cleaning the place up and putting some really well aligned goals back into the system,” she said.
“Even while Rome was burning,” Mulcahy said, “people wanted to know what the city of the future would look like.”
This, she explained, was also true of the Xerox organization. When the end seemed to be approaching, the question employees and investors wanted her to answer most was “what will Xerox look like after it comes through this period of survival and turnaround.”
So in 2001, in order to help them focus on a new shared vision of the future, she said her team wrote a fictional Wall Street Journal article, dated 2005, that detailed exactly what the company would look like.
Part of sticking to the company's new vision, explained Mulcahy, was a refusal to cut any funding of research and development.
“I knew that there was victory that would be shallow if we solved a bankruptcy issue and wound up facing a technology drought down the road.”
Now, she said, two thirds of Xerox revenue comes from products and services introduced within the last two years.
Another key leadership lesson for Mulcahy was to keep the company focused on the customer.
“When you are in deep trouble,” she explained, “it is not always intuitive that you should be spending the vast majority of your time talking to your customers.”
But, she continued, that is exactly what needs to be done. She explained that every executive at Xerox is now tied to specific key accounts they are responsible for and this builds a culture of customer connectedness.
“When people ask me how this company made so much progress so quickly I think they want to hear that there was something particularly brilliant about the strategy or the planning,” Mulcahy said. “And the reality is that it was the alignment of the people around a common set of goals.”
Communication, she explained, is at the heart of everything.
“If you are a big company, the only way to deliver progress quickly is to get people aligned around a common set of objectives,” she said. “Otherwise, it looks good but it doesn't stick.”