Since the turn around in Apple’s fortunes investors look on to see the next big thing. “Xerox, one of the biggest brand names in the world, have got it right in their market and the rest are playing catch up” say OnlineConnect.co.uk. In many ways the companies share similar fortunes. Apple (founded by Steve Jobs, Stephen Wozniak, Ronald Wayne) produced the first successful personal computer with a graphical operating system. Xerox (founded by Chester Carlson, Joseph C Wilson) were the inventors of Xerography (later called the photocopier).
Both Companies however seemed to lose their way in the eighties. In 1983 Apple recruited John Sculley, the marketing genius behind Pepsi Cola, to work as CEO alongside Steve Jobs. It should have been the dream team. But as Apple announced the arrival of the Mackintosh, with a Ridley Scott commercial entitled 1984, an internal power struggle was happening behind the scenes which eventually saw Jobs forced out of the company he was one of the founders of.
Xerox, seeing their core product under competition in the seventies, started investing heavily in the computer industry. Building a team of innovative programmers and inventors they developed graphical operating systems, the computer mouse and what could have been the first commercial personal computer (except Xerox failed to realize the commercial value and didn’t market it). Xerox foresaw the development of the document and its transition from paper to electronic data. However, while they were investing in the future of documents, they had failed to protect their core business and by the mid eighties Xerox were in rapid decline with other manufacturers having caught up with their technology in the photocopier market.
In 1979 Xerox threw opened there doors to the press and public showcasing their unique products, amongst those attending was Steve Jobs and Bill Gates.”They just had no idea what they had” Jobs was later quoted as saying. Xerox internally had connected individual sites together using what they referred to as ‘Inter Network Routing’ later abbreviated to ‘Internet’.
John Scully carried huge weight with Apple’s board, having been behind the Cola wars marketing battle that had seen Pepsi catch up the worlds biggest brand name Coca Cola. But some of Apple’s marketing alienated customers, such as the infamous Mackintosh Lemmings advert. The Apple Mac, developed by Jeff Raskin and Steve Jobs (before he left), became a success and the market leader in desktop publishing and the media industry. Meanwhile the Apple Lisa , which John Scully had removed Steve Jobs from, sank without trace.
By the mid eighties Xerox and Apple had opposite strengths and weaknesses. Whilst John Scully at Apple was a proven marketing guru, Apple by the end of 1985 had lost both co-founders Stephen Wozniak and Steve Jobs. Xerox meanwhile had one of the best development teams in the world at that time in the computer industry. They foresaw the rise of digital documents and communication through the internet and were speculating about a digital market where people advertised on search. But whilst Xerox had the ideas they lacked the marketing expertise and suffered in trying to make the transition from Xerox Machines to IT in the eyes of the business user.
Ultimately both Apple and Xerox hit a brick wall in the eighties when they tried to tackle the business market leader IBM. Whilst many thought the battle for the business user would be about hardware, one small software company were concentrating on the operating system. Bill Gates Microsoft had none of the overheads of manufacturers and was licensing its own version of UNIX and later DOS to computer vendors. In 1981 Microsoft were contracted by IBM to provide the operating system for the IBM Personal Computer. As IBM PC clones came to the market Bill Gates and Steve Ballmer successfully marketed MS-DOS to other manufacturers. In 1985 Microsoft released a graphical version of its MS-DOS operating system called Microsoft Windows for retail. The product was a massive success and became the most widely used operating system in the world. Microsoft went on to become the dominant operating system in business, networking and pc in successive versions of Windows and Microsoft Office. Free from the expensive costs of manufacture Bill Gates’s Microsoft saw the potential of licensing the operating system itself.
Apple and Xerox continued down different paths in the 80’s and early 90’s. Seeing there core product sales falling Xerox began to reinvest in photocopiers and printers and digital multifunction copiers that combined scanners and printers. In response to Canon’s CLC technology Xerox invested heavily in developing Color Copiers. Apple development was lead by marketing and too many products, too high manufacturing costs and the lack of technical leadership saw Apple release a series of unsuccessful products. Steve Jobs went on to create Pixar and NeXT. It was the purchase of NeXT primarily for its operating system that brought Steve Jobs back to Apple in late 1996. By July 1997 Jobs was running Apple again ousting Gil Amelio. Gil Amelio went on to form several companies with Apple co-founder Steve Wozniak. In 1997 Apple started retailing direct on the internet and introduced a new build to order system following in Dells success. Michael Dell commented at the time when asked what would he do with Apple “I’d shut it down and give the money back to the shareholders”. Nine Years later when Apple value rose above 72 billion outstripping Dells share price Steve Jobs had the last laugh circulating an email that read, “it turned out that Michael Dell wasn’t perfect at predicting the future”.
In 1997 Steve Jobs announced collaboration with Microsoft to release Microsoft Office for Apple Mac and Microsoft purchased 150 million in non voting stock of Apple. Microsoft dominance of the operating system market now being so strong, that perhaps it was in their interest to keep a competitor afloat, especially with antitrust charges surrounding Microsoft at the time. 1998 saw Apple focus on a return to profitability and the launch of the hugely successful iMac. Apple’s comeback continued under Jobs with retail outlets opening and has seen the brand branch out with huge success into iPhones and iPods. In an incredible comeback Apple brought in some of the best people in Silicon Valley to their board of directors including Eric Schmidt of Google.
Xerox had to wait until 2001 for there “Jobs” in the form of Anne Mulcahy who had been with the company for many years. Dubbed the accidental ceo it was Mulcahy who stuck by Xerox R and D whilst at the same time returning the company to profitability. Recognizing the huge value in their brand Mulcahy stemmed the flow of customer leakage by improvements in customer service and later improvements in technology. Reinventing the Xerox logo in the process to appeal to a modern internet audience, Anne Mulcahy focused the company on innovation and customer interaction. Xerox with its strength in R and D now fully supported started to combine their computer expertise with their hardware digital technology. The vision they showed so many years ago in the computer industry is finally combining with their core products following “the document” in all formats, be that Electronic, Internet, Email or Print. Today Xerox, now headed by Ursula Burns, are one of the leading Document Management providers in the world and with excellent hardware and leading technology such as solid ink printing Xerox seem uniquely positioned to become market leader again.
This article published here.
Jennifer Robinson writes for OnlineConnect.co.uk an office equipment and document management solution provider that specialise in the sale and rental of office photocopiers for business. Visit there website http://www.onlineconnect.co.uk/