Xerox 2015 Annual Report Download - page 6

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• We are redefining the future of print technology through innovations
like printed electronic labeling that improves product security and
enables data collection throughout the supply chain. We are seeing
high interest in this technology from segments such as pharmaceuticals
where product authenticity is a growing problem.
Optimizing Our Portfolio
2015 also was a year that was distinguished by a number of key actions
we took to optimize and position our portfolio for the future. These
decisions were made to create more focus in markets where Xerox can
differentiate its offerings and exceed client expectations, all in service of
improving operating performance and increasing shareholder value. Here
are some examples:
• We sold our Information Technology Outsourcing (ITO) business to
Atos, an international leader in IT services. The transaction resulted
in a greater focus on our Business Process Outsourcing and Document
Outsourcing businesses. It also enabled us to partner with Atos on
developing solutions for our customers that leverage Atos’ world-class
ITO capabilities.
• We restructured our government healthcare business to increase our
focus on higher margin, growing segments like medical and pharmacy
benefits management, and fraud and abuse detection. We also reduced
our participation in certain Medicaid platform implementations that
were presenting unattractive levels of risk and exposure.
• Our Document Technology business successfully refreshed its product
portfolio by introducing nine new products. Notable among them
was the Xerox Rialto® 900 Inkjet production color press. It sets a new
standard in production volume and efficiency while offering the smallest
footprint of any inkjet press on the market.
• Selective acquisitions remained a key lever for short- and long-term
growth. An example is our acquisition of Healthy Communities
Institute that strengthened our leadership in healthcare analytics.
Its leading cloud platform puts socioeconomic and community health
information at the fingertips of hospitals, public health agencies and
community coalitions.
A New Path Forward
On January 29, 2016, we announced our plans to separate into two
independent companies: one comprising our Document Technology
and Document Outsourcing businesses, and the other our Business
Process Outsourcing business. Both will be significant Fortune 500-scale
companies and leaders in their markets:
• The Document Technology company will continue to be the global
leader in a $90 billion market with a presence in approximately 180
countries. It will include our Document Technology and Document
Outsourcing businesses. Together, they generated $11 billion in revenue
in 2015. This business is the equipment share leader, and its managed
print services offerings are widely recognized as best-of-breed by
industry analysts.
• The Business Process Outsourcing (BPO) company will continue to be a
leading enterprise for the next generation of BPO. In 2015, this business
generated $7 billion in revenue. It has the second-largest market
share in an industry that is rapidly expanding, with notable growth
opportunities in healthcare, transportation, the public sector and a
range of other industries.
We are confident this is the best way forward for our shareholders, clients
and employees. With increased strategic focus and financial flexibility, we
can capitalize on the unique strengths of our Document Technology and
BPO businesses and capture the value-creation opportunities that we see
in each of them.
For customers and partners, each company will maintain its leading
service delivery and innovation excellence. But we will be able to more
quickly respond to market forces and client needs through simplification,
greater focus and agility. Our employees will benefit from working for
industry leaders with leaner structures, faster decision making and
improved growth opportunities. Investors will benefit from two distinct
investment opportunities, each with an enhanced focus on long-term
growth and profitability.
We expect the separation to be completed by the end of 2016.
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