Over 55% of Xerox revenue comes from services

—Rajat Jain

MD, Xerox India

How has the IT industry performed over the past couple of years?

It is very important to understand that the IT industry is related to the infrastructure industry. When talking about our technology business, we are a B2B player, we sell to large enterprises, SMBs, and the government. But for the parties we sell to, it is not a necessary expense, printers are normally replacements, in the technology world you might call it upgradation. So thinking from a CFO point of view, he would think that there is so much of volatility, the stock market going down and the overall economic crisis, let’s cut down costs. Then one would really think about reducing capital expenditure and this was the big challenge for not only Xerox but the entire industry. But now with a stable government, the business sentiment is very strong and the industry is looking positive now.

Do you think that the IT industry will have a positive impact with the new government in place?

Definitely, PMO has started with a bang by calling ministers from other countries for his swearing ceremony and he is also handling foreign relations very well. Also, I believe he himself is a tech-savvy person and has done tremendously well for Gujarat and we hope that he replicates the same at the center. The stock markets are at an all-time high, the Rupee is steady and the sentiment of business community is very optimistic because the government has a clear agenda in place. In total, we all look forward towards a scam free, corruption free socio-economic and political environment that promotes businesses and makes India a developed super power by 2020.

Tell us about Xerox’s transformation story—From where it began and where are you today?

Xerox is today the world’s leading enterprise for business process and document management. Xerox stands for innovation, quality products and solutions, customer satisfaction and technology excellence. However, printing technologies are still integral part of Xerox business, and Xerox continues to be known for its printers and print capabilities with strong service support network. And as technology progressed, the company that brought printing to the masses is now working behind the scenes; digitizing the paper. This brings us to the next level in document technology. Xerox today is a $23 bn company, with over 55% of Xerox global revenue coming from its services businesses. We strengthened our portfolio across entry level single function and high-end multi-function devices across A4 and A3 segments for both color and mono. We also strengthened our leadership in graphic arts and digital imaging solutions that targets the outdoor advertising, photo printing and book publishing industry. Services for enterprises and SME’s are the major driver of Xerox’s India strategy. We have in-house end-to-end capabilities to transform and optimize business process and document management value-chain. This is a key differentiator that Xerox brings to large enterprises in India. While several players offer compartmentalized solutions in these domains, but capability to streamline the entire value chain is something that is unique to Xerox. Sectors like banking, financial services, insurance, telecom, retail, consumer goods, and IT/ITeS look very promising for our services growth. As the only player in the market that has the capability to streamline the entire value chain for its customers, we are well-positioned to participate and gain the leading share of this growth.

How important is the services business for Xerox and what are the offerings in your portfolio presently?

Services is a very important part of our business and we have unique offerings in our portfolio. The first part of our services portfolio - document related services, MPS, document outsourcing services, back office, mail room, couriers, retrieval, storage, indexing. A lot of that is becoming big right now where Xerox has ventured about a decade back. Second business is ACS—Xerox Services—which is pure play BPO, ITO, transportation outsourcing. In this domain—the traditional outsourcing space—all our key customer are in the West. In India, we have 10, 000 people in that business working out of Bengaluru, Kochi & Gurgaon. India is a growth market for all these three businesses. Though the traditional printing business is flat globally but in India it is growing steadily. The document outsourcing business is growing rapidly by 30-40% and the BPO business is also showing healthy double digit growth.

DMS will drive the business growth for Xerox. Under this business we offer a model where a customer need not buy printers & MFD’s upfront as they have capex constraints. Further with challenges of technology upgradation, they source their requirement to Xerox. We offer a pay per print service that becomes an opex model. Today large corporates have customised requirements that are user based where CFOs like to see who is printing what; a service offered in MPS and a huge area of growth for us. The market in India for MPS is about $100-150 mn that market is growing at 30 to 35%. We have the vision to help customers focus on their real business and we take care of their documents which is our real business. We have the Technology, Scale and R&D backing us and we are equipped to address needs of CIOs, CFOs.

Lastly, there have been a lot of people quitting Xerox—Is this a conscious decision or due to business pressures?

Well it was the need of the hour to bring stability to Xerox and there was a need to get local experts in the organization. Another important factor was to get people from different industries and create an ecosystem which has knowledge about different verticals. In Xerox there have been many expats who have come in and gone out in the last 10 years and this time round we wanted to build a team which has deep knowledge about local marketplace and is focused on our deliverables. We hence hired 200 people in the last 2-3 years and of course had to let people go as well. From a time when we had close to 900 people, today we are about 400 people, so there definitely has been a lot of churning but we have managed to get people from different industry verticals and create a stronger team which is working with each other and is delivering the needful. Xerox has provided the Indian corporate world some of its brightest talent and this is clearly reflected in fact that the leaders in some of the biggest companies in India have spent their initial years in Xerox. What Xerox is undergoing today is a cultural transformation and our employee base wants to be a part of this turnaround story.

Xerox has been known for innovation. What is the focus of your research center in India and what are the latest innovations Xerox has come up with?

In 2010 Xerox opened its fifth research center globally and the first outside North America and Western Europe in emerging markets. Located in Bengaluru, the center’s mission is to capture innovation opportunities for Xerox in emerging markets. XRCI works on an Open Innovation model to tap ethnographers and some of the brightest minds in the industry. XRCI also works in association with IIT’s and regional technical colleges to develop innovative solutions to improve workflow at small technology-based businesses in rural India. Researchers have invented a banking solution—Xpress Banking solution that reduces the cost of establishing branches —even in rural areas—and automates much needed personal banking services, like opening a bank account or applying for a loan, making it simple for consumers in India and other developing countries to manage their money. Most recently, researchers at XRCI have also collaborated with Manipal University Hospital to develop non-contact remote health sensing technology that can accurately obtain and track healthcare vitals such as heart rate, temperature and some respiratory functions in neo natal babies.