Xerox 2015 Annual Report Download - page 20

Download and view the complete annual report

Please find page 20 of the 2015 Xerox annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 158

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158

Engage, Develop and Support Our People
Our Services and Document Technology offerings and know-how are a powerful combination, and are supported by
a talented global workforce focused on delivering value to our customers. We continue to develop our employees by
investing in processes and systems to equip them with modern tools that enable them to perform their jobs more
effectively and by providing opportunities for career growth.
Annuity-Based Business Model and Shareholder-Centered Capital Allocation
Our business is based on an annuity model that provides significant recurring revenue and cash generation. In
2015, 85 percent of our total revenue was annuity-based; this includes contracted services, equipment
maintenance, consumable supplies and financing, among other elements. The remaining 15 percent of our revenue
comes from equipment sales, either from lease agreements that qualify as sales for accounting purposes or outright
cash sales.
We remain committed to using our solid cash flow to deliver shareholder returns now and in the future through a
balanced capital allocation strategy that includes share repurchase, acquisitions and dividends.
Acquisitions and Divestitures
The following is a summary of our acquisitions and divestitures in 2015. Additional details can be found in Note 3 -
Acquisitions and Note 4 - Divestitures, in the Consolidated Financial Statements.
In the Services segment, consistent with our strategy to expand our offerings and geographic reach through
acquisitions and to actively manage our product portfolio, we acquired the following companies:
• The learning services unit of Seattle-based Intrepid Learning Solutions (announced in 2014, closed January
2015).
• Healthy Communities Institute, a California-based company that helps hospitals and other health organizations
manage population health.
• RSA Medical, an Illinois-based provider of health assessment and risk management for members interacting
with health and life insurance companies.
• inVentiv Patient Access Solutions (iPAS), an inVentiv Health company that helps pharmaceutical companies
drive product adoption and supports patients in minimizing or eliminating financial and reimbursement hurdles.
Additionally, we completed the sale of our Information Technology Outsourcing (ITO) business on June 30, 2015 to
Atos SE. The sale enables Xerox to increase its focus and resources on expanding its BPO and DO businesses,
areas where the company has competitive advantage. We continue to have a relationship with Atos in which Atos
continues to provide IT services to us internally as well as to our current BPO customers.
In the Document Technology segment, consistent with our strategy to expand distribution in under-penetrated
markets, we acquired Lancaster, PA based Conestoga Business Solutions and Fort Collins, Colorado based Capital
Business Systems.
Innovation and Research
Xerox has a rich heritage of innovation, and innovation continues to be a core strength of the Company as well as a
competitive differentiator. Our aim is to create value for our customers, our shareholders, and our people by driving
innovation in key areas. Our investments in innovation align with our growth opportunities in areas like business
process services, color printing and customized communication. Our research efforts can be categorized under four
themes:
1. Usable Analytics - Transform big data into useful information resulting in better business decisions:
Competitive advantage can be achieved by better utilizing available and real-time information. Today,
information resides in an ever increasing universe of servers, repositories and formats. The vast majority of
information is unstructured, including text, images, voice and videos. One key research area is making sense of
unstructured information using natural language processing and semantic analysis. A second major research
area focuses on developing proprietary methods for prescriptive analytics applied to business processes. Here,
we seek to better manage very large data systems in order to extract business insights and use those insights
3