Xerox to cut 15% of its workforce
cnbc.com
cnbc.com
Just goes to show what happens when MBAs run a product-centric company.
This is what happens when all you think about, all you focus on, is returns to investors. You spreadsheet the shit out of everything.
- You spreadsheet the shit out of everything.
===
+ You spread shit into everything.> "...In it, he argued that a company has no social responsibility to the public or society; its only responsibility is to its shareholders."
the demon friedman strikes again.
Which really wasn't a big deal since you could always do business as yourself although you (and not the corporation) also got liability then.
That doesn't mean short-termism at all costs, which is what some people hear when that is said, but it means, say, if you're Disney don't release a string of movies that all lose incredible amounts of money. Or if you do, then senior management needs changing pronto.
People won't know the implications of decisions without regulations to help them. Of course businesses are populated by people, who will try and do the right thing if that's how they are, but that doesn't mean they know what the right thing is.
> No one facet of the structure society is made of can support all of society, there needs to be safety factors in the building materials.
I can't parse this, sorry. Happy to have a read if you reword.
That's a pretty expansive view of government; I'll grant that regulations are one mechanism for communicating the implications of decisions, but to say that people can't know the implications without regulations? That just seems silly to the point that I'm unsure if I'm intended to legitimately engage with that viewpoint; is that your actual opinion?
In reality, as the system for maximizing shareholder value can interact with the system creating the regulations. Thus:
> in practice regulation was often faulty
wasn't a coincidence of a situation, but rather was a direct result of the shareholder-value-maximizing machine working towards the removal of regulations that hindered shareholder value.
If that is misused, the blame lies with the regulation writers. They get to take free money from people as taxes solely so they can be impartial and write good regulations. If they can't even do that, then why give them free money?
Everybody hates corrupt government officials already, but as a society (in the US) we tend to handwave away companies doing destructive self-interested things as "oh of course they do that", when it's not actually something we need to tolerate.
Oil companies in the 70s knowing that they were causing global warming but engaging in a campaign to pretend that didn't exist? Should be jail for the regulation writers, and jail for the oil company execs who signed off on it.
The Sacklers pretending that their special opioids aren't addictive and causing the opioid crisis? Should be jail for the regulators they bribed, and jail for the people at the company who knew.
Cause the 2008 financial crisis by deliberately mis-grading subprime mortgages? Should be jail for everyone who let that fly.
That's interesting. Everywhere I read (including in HN comments) the focus is on lobbyists and not regulation writers. I've never read anyone ever put the blame on the people who were given free money from taxpayer pockets to be impartial experts, and only ever on people trying to advocate for their companies.
> as a society (in the US) we tend to handwave away companies doing destructive self-interested things as "oh of course they do that", when it's not actually something we need to tolerate
I don't believe "as a society" exists :-) It's one's perception of what happens, but wrapped in an impartial-sounding phrase. I've seen far more tolerance of regulation-writers than I would expect. And there is a clear difference between a company (legally) trying to change hearts and minds and regulation writers allowing their minds to be changed for perks.
> Oil companies in the 70s knowing that they were causing global warming but engaging in a campaign to pretend that didn't exist? Should be jail for the regulation writers, and jail for the oil company execs who signed off on it.
Oil companies don't have a legal responsibility to tell the truth about the climate, I think. Also, the understanding of climate has changed quite a lot since then, so even I might go easy on regulators in this instance.
> Cause the 2008 financial crisis by deliberately mis-grading subprime mortgages? Should be jail for everyone who let that fly.
This is a good example of regulation being to blame, though. You'd go to jail if you didn't allow a certain percentage of subprime mortgages[0].
[0] https://web.archive.org/web/20080928095759/http://www.invest...
Sounds neutral to the layman while legitimizing the "brushing under the rug" of all the sins possible without severe legal recourse. Then promptly followed by some hand waving that really puts the you-know-what in fiduciary, Mr. Potter.
The invisible hand of the market seems to mostly be involved in sweeping problems under the rug.
While not definitive, ChatGPT says that:
> The idea of organizing a group of people to work towards a common goal for profit or mutual benefit has evolved over centuries. The modern concept of a company, with legal structures and formalized business practices, has its roots in the emergence of capitalism during the Industrial Revolution in the 18th and 19th centuries.
Whereas the first stock exchange is somewhere between 1300 and 1600: https://en.wikipedia.org/wiki/Stock_exchange#History
Wikipedia doesn't have a history section on it's page for company, but it says this:
> By 1303, the word company referred to trade guilds. Usage of the term company to mean "business association" was first recorded in 1553, and the abbreviation "co." dates from 1769.
You can tweak your definition by the means you'd like, but I think an honest assessment would be at this point to say they were concurrent.
https://en.wikipedia.org/wiki/Company#Semantics_and_usage
So your statement seems incorrect. I'm no expert, just curious.
Corporations aren't a free market concept, it's a way for the state to give special protections to certain companies that need it for some prosocial reason.
A short history: https://newint.org/features/2002/07/05/history
Basically, the original idea is, a corporate charter is granted to create a corporation, which acts on behalf of its shareholders (who the government trusts, have some worthy interest in mind).
They can't vote, can't get married, etc.
If you must grow by x% every year, and infinite growth is impossible, you begin shoving more and more low quality ads into your search results, partake in more legally and ethically grey activities, and eventually rupture?
Are there any examples of large corporations that have said, “we make billions in profit each year. We’re going to focus on maintaining that enormous success. We’re not going to focus on growth.” (I can already hear the spreadsheet squinting logic about how growth is necessary for some reason)
And yet, a bad quarterly earnings report will tank a stock...
> Driving the company to failure by relentlessly cutting costs in the name of "growth" is not in the interests of the owners.
Sure it is. They've maximized their personal revenue and now it's time to get out. The sooner the better.
Where is Xerox going to get the money to do R&D to not be obviated? Replace Xerox with any other business.
All the businesses obviated by spreadsheets, mobile networks, smartphones, GPS? Maintaining success is continuing to make bets and moving forward, and bets require money. More money means bigger bets.
Another example, you have two businesses, one with a 5% profit margin (because they feel like 5% is enough), one with a 10% profit margin. The one with 10% profit margin is going to be able to continue renovating the business, upgrading the facility, buying more land, hiring better employees with higher payrates.
What will happen to the 5% profit margin business? Do you think customers will keep rewarding them (assuming the 10% profit margin business is worth the additional marginal cost)? You can insert restaurant, hotel, retail store, etc in here.
Note that having a higher profit margin is not the only way to survive, having a lower profit margin to better compete on price and gain market share is another way too. Balancing the two and delivering the right product at the right price for your customers is the key skill, but it’s a moving target.
That 10% growth rate may or may not be factoring in some externalities that the 5% growth has to
https://en.wikipedia.org/wiki/Dutch_disease
My point was businesses compete with each other, and money is one of the tools used to compete.
And growth rate and profit margins are not the same.
If you only ever reward investments with high rates of return it leads to atrophy in boring yet essential sectors of the market. Supermarkets, like you mentioned, have a very low profit margin (usually 1-3%). Can you imagine what would happen if no one was willing to invest in a supermarket?
>Note that having a higher profit margin is not the only way to survive, having a lower profit margin to better compete on price and gain market share is another way too. Balancing the two and delivering the right product at the right price for your customers is the key skill, but it’s a moving target.
Some investors will seek a 10% return in exchange for higher risk.
Others will be happy with a 3% return that is much lower risk.
Portfolios will include some of both types of investments depending on goals and risk tolerance.
Further, the best way to grow %x for a long time is to provide quality. Shittification is a short-term strategy.
There are numerous reasons for companies to exist. Off the top of my head I can think of a few. To provide goods to populations. To provide services for populations. To give the owner something to do. To perpetuate themselves. To provide something to do for employees. To do something an individual can’t.
None of these require investors. There are countless businesses that can be started that don’t even require a significant outlay of capital.
On top of that there are differing philosophies that might suggest investors should be last in line for benefits from a business. I could make a strong argument that society allows businesses to exist and as such society should benefit first and foremost. Businesses typically fail to exist without employees, so I could argue employees should come before investors.
Please don’t perpetuate the naive notion that investors are somehow more important than anything else. I am a dyed in the wool capitalist and while I tend to highly value profitability, even I don’t believe shareholder value is some sacred edict.
He did his MS in Materials Science at Stanford.
Also, plenty of STEM background people join McK later in their careers (especially in the electronics space) because there is plenty of demand for Strategy and Management Consulting in the industrial world, as LDPs aren't as popular anymore
Today it is 2,500 people versus 45,000 people, and I would guess it is still probably true that a greater proportion of DE Shaw is technical than McKinsey.
An Petroleum Engineer, Materials Engineer, Industrial Engineer, Chemical Engineer, Biopharmaceuticals Researcher, etc will always have the option to work at an MBB, as those industries heavily use McK to help with their own businesses.
On top of that, McK hiring even at the undergrad level skews STEM. If you attend a feeder school like MIT, Stanford, or Berkeley, it's EECS/Applied Math/Physics majors that land Associate interviews, because management is much more technical now. McKinsey literally has recruiters devoted only to candidates from Berkeley and UMich Engineering for strategy roles.
It isn't the 1980s anymore when some random schmoe with an Econ or Business degree can land an MBB role anymore.
I quit and don’t regret it at all, everybody I talk to there basically just says they have zero inspiration and shuttle between pointless meetings and are only there for a big paycheck. In my view, that’s a pretty miserable existence - one needs passion to thrive.
Kodak was also doing great, until suddenly they weren’t. My own personal experience of the last year is my search engine use has about halved in favor of GPT, with most of my friends reporting the same.
If Google is ever forced to admit in an earnings call that search volume is down the stock will crater on the spot.
And Nadella went to MIT (India), with an MSCS from U. Wisc.
I'm sensing a pattern here...
for those who are confused.
He attended UWisc Milwaukee (which makes his climb up the ladder even more impressive).
He also did the Part time MBA at UChicago Booth while at Microsoft
(Context: I was 15%'ed back in April.)
Up until now . .
Every business I can think of that has a “headquarters” separate from their largest employee pool seems to be in decline… GE, Boeing being big obvious examples. It seems like moving the executives away from the day to day work is a sign the business doesn’t care about itself anymore. I’m curious if there are any other examples, or any counter examples to this.
The only benefit given by the state in exchange for “headquarters” is employing a certain number of people at a certain income. But if all your payroll stays somewhere else, then what could possibly be the incentive for tax breaks?
"To secure the latest corporate retention project, the State of Louisiana offered CenturyLink a competitive incentive package that includes an annual performance-based grant, subject to company payroll performance. In addition, the agreement creates funding for information technology faculty, curricula and education at Louisiana Tech University, where the state has supported the Clarke M. Williams Professorship in Telecommunications in honor of the company’s founder."
https://news.lumen.com/2019-04-02-Gov-Edwards-And-Centurylin...
> subject to company payroll performance.
Exxon is another example I can think of. Until recently, their HQ was in a tiny building in Irving, TX while the majority of their workforce was elsewhere.
There's also a whole slew of companies that have a lot of employees "in the field" that are separate from their corporate workforce and would inherently be HQed in locations other than where their large employee bases are, eg manufacturing companies, Intel, car manufacturers, Walmart, UPS, several airlines, banks... Even Boeing would fall into this category. I'm not sure how those factor into things.
The irony which sometimes happens is that those who work for Xerox (or Kodak, who has been doing the same demise, just on a grander and faster schedule) end up working for a contracting firm and then get "rehired" back to do the same job they used to do, just now not as an employee of Xerox. I'm not convinced this saves Xerox any actual money but it must work out to their benefit somehow as TONS of people doing work for Xerox are not Xerox employees but used to be.
https://www.macrotrends.net/stocks/charts/XRX/xerox-holdings...
Focus on high share price seems more important for speculators who wanna make a quick buck on the short term regardless if the company dies in long term.
The other parts of the function include the expectation someone else will buy it at a higher price, which may or may not be based on their own expectation of someone else to buy it from them at a higher price, and so on.
Profits are related to UFCF, but not the same thing.
I am partially shocked. Thought they were no longer a company.
Gartner has discontinued printer, copier and MFP market coverage.
Their website lists printers, copiers, and supplies, as well as 'Print Solutions' and 'Document Solutions'.
A decent number of the actual machines sold under the Xerox name are designed and/or manufactured by 3rd parties (some are subsidiaries or former subsidiaries like the old Fuji/Xerox group) but a handful of the high end machines are still fully designed and manufactured in the USA. Lots of the toner is manufactured in the USA, too.
Last I'd heard (2018?) they were researching the 3d printing business, but since their main site doesn't say anything to that note I have to believe it's not going too well.
https://patents.google.com/?assignee=Xerox+Corporation&sort=...
The rest of the website is like urbexing a dead mall. The job postings tell a story of hollowing-out. You can't say it is strange though. So many organizations follow the same trajectory of under-allocating to product development and find themselves coasting on the R&D already done, then shrinking, slowly at first, then quickly.
Yep, there's a heavy MBA focus on financials as opposed to doing what's best for customers. Funnily enough you're shipped off in your first weeks to an indoctrination course on quality, but later catch on that MBA speak is holy writ.
Every few years there's transformative change and more folks get dumped.
So you make all these plans for the new year and then the axe comes.
If a company is going to lay me off with N weeks of severance starting on Jan 15, 2024 or N+4 weeks starting on Dec 18, 2023, I'd way rather learn about it on Dec 6th than on Jan 3rd.
Gosh, I really feel like I understand the rationale and the forward plan now.
I suspect any explanation of those terms would need to be on their investors page.
https://investors.xerox.com/news-and-events/presentations-we...
Parent said "but I'm not privy to some of the investor calls where they elaborate on how they define these terms. Typically things like "business unit operating model" will be illuminated / detailed in other presentations with a smaller audience". I'm saying that I think that Xerox can't be explaining things in this much depth to some investors but not others.
Certainly Xerox can give information to CNBC to release to all investors (who read CNBC) at roughly the same time. It's basically public since everybody has CNBC access but a private presentation is by definition not public.
> In principle the companies are not supposed to give the investors material nonpublic information during these conversations. In practice, the conversations are not social calls. The analysts hope to get something out of them. It's rarely "our earnings are going to be way better than anyone expected." It might be something vaguer and squishier than that: hints, body language, a general sense of how management thinks about the world, its industry, its competition, its opportunities. Or it might be something much narrower and more specific: The company might help the analyst with particular line items in her model, adding nuance to her sophisticated understanding of its financial situation.
Specific clarification on details of their new "business unit operating model" would be a relatively normal thing to talk about. It's not something that is a smoking gun for insider trading, but can be written off as just general clarification of an industry term of art. This would be a normal thing for business analysts to get a deeper dive into.
0: https://www.bloomberg.com/opinion/articles/2015-07-31/when-c...
> These things are plausibly not "material nonpublic information." But they are obviously things that investors want. That's why investors meet with companies. That's why investors who meet with companies perform better than those who don't. And all of this is legal. Or legal-ish. Or at least in a broad gray area between legal and illegal.
Nobody who really cares is reading the generic press release; if the performance of Xerox is strongly relevant to your interests then you have better sources of information.
The presser is just something for the comics to reprint verbatim, the more meaningless it is the better because that prevents it being in any way legally actionable.
> shift to a business unit operating model
Translates to "dividing the company by product, and evaluating each product independently". What's meaningful.
The rest of it is completely bullshit though. But I really liked "balanced execution priorities", that's an entirely antisemantic expression, you either have priorities or you don't.