Monday, June 28, 2010

Can/Should Xerox Monetize Non-Core Innovation?

Xerox Chief Burns discussed innovation at her company in an interview at the World Innovation Forum on June 9, 2010. She described several inventions at Xerox’s research centers such as PARC (Palo Alto Research Center) such as the graphical user interface, ethernet, and postscript without any impact to the firm's bottom line. Now the breaktrough idea is that outside firms can hire PARC and its portfolio of specialists to source their own inventions, in other words offering "outsourced innovation" services. 

I am very skeptical with the approach however - First, when Xerox has misreably failed to monetize its core innovation, how could one expect to do a better job with non-core intellectual property assets? Secondly, why wouldn't they focus PARC developpers on core-innovation first & only and establish an integrated set of processes and dialogues to inject them into Xerox core businesses to fuel growth through sustainable differentiation or new streamlined delivery models? For example, about one fourth of the projected synergies from ACS acquisition was committed based on adoption of PARC technologies at ACS in their delivery platforms.  Lastly,  after hiring a new Chief Strategist with Private Equity background, Xerox has started emulating the famous PE value creation model to re-invent itself.  However, I am skeptical of their ability to execute as religously as a PE firm against a very tough, status-quo minded culture.

You can read the speech in more detail:

 What do you think? Look forward to your tweets - @hakana

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