Case Analysis #2

1.Explain the circumstances that led Kearns to adopt the 'Leadership Through
Quality' Program. In the backdrop of his initiatives to retain Xerox's global
competitiveness, comment on the rationale behind the decision to implement
benchmarking practices at the company.

The circumstances the lead Kearns to adopt the "Leadership through quality" Program

when Xerox's management failed to give the company a working directions. It was

ignored by the new entrants who would somehow compete for it with them and also

make them sin a stronger position in the lower standard of the market and in niche

segments. Also their operating cost went high therefore their products also increased its

prices above the estimated cost. Xerox that time also suffered from its highly centralized

decision-making processes. As a result of this, return on assets fell to less than 8% and

market share in copiers came down sharply from 86% in the late 1974 to just 17% in

1984. Therefore it means a useful or valuable thing, person, or qualities of the company

eventually fell. Also Xerox’s profits decreased. Those are the circumstances that the

company had that led David T. Kearns when he took over as the CEO of Xerox in 1982.

He discovered that the average manufacturing cost of copiers in Japanese companies

was 40-50% of that of Xerox. As a result, Japanese companies were able to undercut

Xerox’s prices effortlessly. Kearns quickly began emphasizing reduction of

manufacturing costs and gave new thrust to quality control by launching a program that

was popularly referred to ass ‘Leadership through Quality.’ As part of this quality
program, Xerox implemented the benchmarking program. These initiatives played a

major role in pulling Xerox out of trouble in the years

2.Define benchmarking and discuss the various types of benchmarking. Explain

the steps involved in the implementation of a typical benchmarking process.

Benchmarking is simply the process of comparing and measuring an organization's

operation or its internal processes against those of a best-in-class performer from inside

or outside its industry and prioritize that will lead to competitive advantage, It is also the

search of industries best practices that lead to superior performances.

There are also Three (3) Types of benchmarking, First of it is Internal Benchmarking

which is the search for best practice of internal operations by comparison of the

operating divisions within the same company. Second is the Competitive benchmarking

which is studying products or business results against competitors to compare pricing,

technical quality features and other qualities of performance characteristics, and the last

one is Process benchmarking, this type of benchmarking Identifies the most effective

practices in key work processes in organizations that perform similar functions, no

matter what industry, This is also known as functional or generic benchmarking.

3.Describe Xerox's benchmarking model. How did Xerox go about implementing

benchmarking practices in the company?

Now to implement this types of benchmarking, there are six (6) stages. The first step is

basically to decide what to benchmark because most of the business organization have
a strategy on how the company wants to position itself in the marketplace. The second

one is to understand the current performance to compare the processes outside the

benchmarks and to do that it needs to understand first its own processes. The third one

is to plan, Once the firm's current processes have been documented, it is possible to

make decisions on how to conduct the study needed. The fourth move is to collect the

data and when doing that the team must document everything about the partner's

process. The first step is learn from the data that has been gathered from

benchmarking. and of course the last but certainly not the least, Use the findings which

the benchmarking has done and improve the result.

Xerox developed its own benchmarking model. This model involved tens steps

categorized under five stages - planning, analysis, integration, action and maturity.

Planning: Determine the subject to be benchmarked, identify the relevant best practice

organizations and select/develop the most appropriate data collection technique.

Analysis: Assess the strengths of competitors (best practice companies) and compare

Xerox's performance with that of its competitors. This stage determines the current

competitive gap and the projected competitive gap.Integration: Establish necessary

goals, on the basis of the data collected, to attain best performance; integrate these

goals into the company's formal planning processes.Action: Implement action plans

established and assess them periodically to determine whether the company is

achieving its objectives. Maturity:Determine whether the company has attained a

superior performance level. This stage also helps the company determine whether

benchmarking process has become an integral part of the organization's formal

management process.Xerox go about implementing benchmarking practices in the

company by collecting data on key processes of best practice companies, These critical

processes were then analyzed to identify and define improvement opportunities.4. What

benefits did Xerox derive from the implementation of benchmarking practices? Why do

you think benchmarking initiatives sometimes fail to give companies the expected

benefits? Explain how you would go about ensuring the success of the benchmarking

initiatives undertaken by the company.

4.What benefits of Xerox derive from the implementation of benchmarking

practices? Why do you think benchmarking initiatives sometimes fail to give
companies the expected benefits? Explain how you would go about ensuring the
success of the benchmarking initiatives undertaken by the company?

The most benefitial of it all was the first major payoff of Xerox's on benchmarking and

the satisfaction of the customers from the Xerox Machines itself for the outcome of it

was in a wonderful number.The financial performance of the company also improved

considerately through the mid state of 1980s. Overall, the customers satisfaction was

rated at more than 90% in 1991. Also the numbers of machines that has been defective

has also reduced in rate by 78 per 100 machines. Most of the problems before the

benchmarking was used like Response time,Inspection of incoming components,

Defective incomming parts,Inventory cost, and all the other importannt part to look at

has reduced its defective rate because of this particular practice that has been done

and those are the benefits of it.