Q&A: CEO savior Anne Mulcahy on getting the color back into lifeless Xerox

Also offers her views on presidential race, CEO compensation and the H-1B debate

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What was the single toughest decision you've had to make as CEO of Xerox? Certainly during those years, there were a lot of tough decisions. I sometimes point to, because it was one of the most memorable experiences, shutting down our consumer business. It's a business that I ran, I helped author. A business that could have had promise over time, but there wasn't time. You're in a situation where you have to make really clear choices. You can't afford to be less than decisive. So we made a decision that that was not core to the company's success or strategy, and therefore shut down that division. Great people, a lot of promise. Always tough to do, but this one was kind of personal.

Can you identify a single best decision? I don't think so. It's interesting -- I get asked a lot about the turnaround, and I think the hope is that there's some magic or silver bullet, or something that people can point to that really was exceptional. And I actually think that we turned the company around very much on a whole set of fundamental good business practices that we sustained for a long period of time. No magic formulas. This one's really just hard work and great people who stay focused and can accomplish great things.

How about a single worst decision? I think what's important about that is that there were, certainly, plenty of less-than-perfect decisions that got made. For us, the worst decision was no decision. It's the things you don't deal with. It's much easier to fix mistakes than it is to fix inaction. I would say there are things that we should have dealt with earlier that I would look back on and say, "That cost us. We should have stepped up to the plate and done it earlier." Now, we were doing a lot. But when you look back, it's the nondecisions that are the biggest mistakes.

How much are you investing in R&D, and where to you expect that investment to take you? We're investing as a company just under $1 billion annually. And we have a partner in Asia-Pacific, Fuji Xerox, who invests another $600 million. Our two biggest pools of investment are transitioning the world to color and services.

In the print world, the quality, the cost, the ease of use and the impact of color are huge in the communications world now, and there's a whole offset [printing] world out there that will be transitioning to digital capabilities for things like personalization and print on demand. So color is an extraordinary opportunity.

With services, there's both the business-process side of services as well as the software and technology side. In the document space, our services really help our customers cut through the clutter; deal with information overload; really enable you to get the information you need, when you need it; bridge the paper and digital worlds, which is a huge challenge in today's business environment.

So the document management services side and color would be the two big bets that we've made as it relates to our research and development -- about 70% of our total R&D is in those two areas.

How high on your priority list is helping companies with power management and being more green? Very high. I was Dublin two weeks ago. We brought together 200 very, very senior people, and the topic was sustainability. We have a very long history in being green -- literally decades. We literally invented things like remanufacturing and reuse long before they were in vogue. It's finally on the radar screen. Our customers are asking about it; we even have a few investors that care about it. I think it's a huge opportunity because it's a great match. When you look at environmental impact and productivity and, quite frankly, profit improvement, there's a very synergistic set of capabilities.

Your dad was a journalist; you majored in English and journalism and aspired to be a journalist, yet you never pursued it. Any regrets? No, because obviously Xerox has turned out to be a great place to work. I've been here 32 years, so it can't be too bad. It's interesting how important some of those skills are in running a business. Being able to write and articulate your thoughts, and to think about messaging in a way that's important, has definitely proven to be an asset in running a business. So I don't think it went to waste.

Copyright © 2008 IDG Communications, Inc.

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