In-plants React to Fuji Xerox Deal

Now that in-plant managers have had time to get used to the idea that one of the top U.S. equipment manufacturers is being taken over by a Japanese firm, several have let IPG know how they feel about it. It's no secret that Xerox has both fans and foes in the in-plant industry. Spotty service in one region is offset by excellent coverage in another, so reactions to the $6.1 billion deal that will combine Xerox with its longstanding Fuji Xerox joint venture have been influenced somewhat by past experiences.

"I really hope the Fuji Xerox deal will fix the problems I have seen with Xerox over the years," says Jim Lyons, manager of Print & Mail Services at the State University of New York at New Paltz, who details some "lousy customer service" experiences of the past. "Xerox machines were great workhorses, but we always had issues with billing and back-end support. Our Accounts Payable department went crazy trying to straighten everything out each month. Let's hope Fuji is the solution that brings customer service back to Xerox."

Donna Horbelt

On the other hand, says Donna Horbelt, director of Printing & Media Services at the University of Texas Health Science Center at Houston: "We have been a Xerox customer since the mid 1980s. I can honestly say that we have a wonderful working relationship. No billing issues, no service issues and the quality has been spectacular. I just installed the new iGen5 120 with white and clear. It is unbelievable.

"Fuji has owned over 50% of the Fuji Xerox portion of the company for many years, so this is not a surprise," Horbelt continues. "Most companies like Xerox partner very closely with other companies. It is the new trend for business and it will encourage technological advances much sooner and hopefully make them more economical. I hate to see Xerox go away but I think they will be a stronger company as Fuji Xerox."

An Australian in-plant manager and IPG fan was a little more skeptical, having experienced the Fuji Xerox joint venture for many years already.

"The experience from the in-plant perspective is not so rosy," he says of Fuji Xerox in Australia and New Zealand. "Fuji Xerox are ultra-aggressive with their 'managed services' division and their pursuit of in-plant business."

He also points out that in June, Fuji Xerox was chastised for “inappropriate accounting practices” in its subsidiaries in Australia and New Zealand, resulting in a series of top-level executive and board resignations.

But some U.S. in-plants are willing to start with a clean slate.

Abbas Badani

"What hopefully will be a positive result is that it might give [Xerox] an opportunity to focus back on its core fundamentals: solid products, great support and service and an opportunity to shed its painful efforts at trying to become a services provider," says Abbas Badani, director of Penn State University's in-plant. "Xerox has been in trouble since it took part in the boondoggle that was the merger with ACS. It is fortunate that the name still carries enough goodwill that they were able to find a willing suitor in Fuji."

But the sad reality that another homegrown American company is ceding control to a foreign firm is not lost on him.

"What is of profound historical importance is that another industry that was once a product of American innovation has no American presence left in terms of corporate ownership," he laments.

And then there's the issue of layoffs. Just prior to to the announcement, Fujifilm Holdings revealed it was eliminating 10,000 jobs within Fuji Xerox, the bulk of which would likely be in the Asia-Pacific. But with both companies anticipating $1.7 billion in total annual cost savings by 2022, some managers think that translates into even more layoffs.

"I just feel sorry for the people that will bear the brunt of the $1.7 billion in savings," remarks Ken Johnson, director of Printing Services at Ball State University. "You know that most of the cost savings will come at the expense of good hard-working people, who will not get golden parachutes."

Xerox customer Steve Priesman, manager of Printing & Publications Services at Omaha Public Schools, finds the Fuji Xerox deal "very disturbing" due to past experiences with Fuji.

"We have had major problems with Fuji insofar as their sales and support organization for the graphic arts market," he reveals.

Other long-time Xerox customers are more comfortable with the deal.

"I have bought or leased Xerox products throughout my career," remarks Jimmy Robinson, director of Print and Mail at the University of West Alabama. "Xerox set the bar for quality and service. All the other competition merely copied them. As much as I hate to hear about this deal I would think that Fuji Xerox will emerge as an industry leader."

"The machines, service and tech support over the past 12 years have always been good," adds Rod Squier, manager of Amherst College's Campus Print & Mail Center. "I guess time will tell for sure, but seeing that Fuji has been part of them for so long I’m not worried."

Chris Donlon

"I am excited to see what this change will bring to the market," says Christopher Donlon, associate communications manager at Kohler Co. "In-plants always walk a fine line with companies like Xerox that also offer managed print services that would surely replace us given the opportunity. A technology and machine capability focus as well as enhanced field service is what our industry needs at this time. Drupa 2020 should be very interesting."

"I believe the new Fuji Xerox will be a combination that is both positive and transformative," notes Dwayne Magee, director of Messiah College Press. "I was fortunate enough to have a brief conversation with Jeff Jacobson, CEO of Xerox, and Carl Langsenkamp, director, Global Analyst/Public Relations, shortly after this news broke. They both are optimistic and see this as a 'coming together' of two iconic brands."

Jacobson (who was not one of the 10,000 who will be laid off, despite key shareholders demanding it) and several other Xerox executives will be addressing questions and concerns at an upcoming online IPMA event. The Xerox Forum is scheduled for February 16th and it is open to all in-plants. Attendees do not need to be IPMA members. They can register for what promises to be a very interesting discussion at this link.

According to Xerox, the transaction is expected to close in the second half of 2018, subject to the satisfaction of customary closing conditions and regulatory approvals and approval by Xerox shareholders. Xerox will continue to operate business as usual until the transaction closes.