Nearshore Americas

Xerox Seeks New CEO as BPO Unit Travels Challenging Path

Outsourcing and document technology firm Xerox has announced that its CEO Ursula Burns will give up her title and serve as the Chairman of its managing board after the company splits into two later this year.
Fifty seven-years-old Burns has long been working for Xerox, having joined the company as an intern in 1980. She is one of 20 women who held the CEO position at an S&P 500 company as of Feb. 3, according to Catalyst, a nonprofit research group.
“Ursula’s deep industry experience and relationships along with her proven leadership skills….. .will help ensure a smooth transition to a new management team,” stated Ann Reese, an independent director of Xerox, in a press release. She will continue as chairman and CEO until the company selects new CEO.
Norwalk, Connecticut-based Xerox announced in February this year that it would separate its BPO business from its core document technology unit, apparently to help executives decide which technology they will adopt to streamline operation and compete better with rivals.
Xerox moved formally into BPO business in 2010 when it acquired Affiliated Computer Services Inc. for $6 billion. Before the merger, ACS had enjoyed a significant operation across Latin America, with thousands of employees working for its call centers in Mexico, Guatemala and Jamaica.
ACS made two important acquisitions in the nearshore region: In 2008, ACS acquired Multivoice, an Argentina-based customer care services provider with delivery centers in Chile, Colombia and Peru. A year later in 2009, it acquired e-Services Group with operations in Jamaica and St. Lucia.
Today, it is not clear how many people are working for its BPO unit in Latin America. What is clear, however, is that the acquisition of ACS added 74,000 to its workforce.
Today Xerox BPO business appears to be struggling to turn profit. Sales from its services, which includes business process and document outsourcing, have been declining in the past two quarters. Xerox plans to cut about $700 million in annual costs this year, and it has already eliminated about 8,300 jobs during the first three months of the year.
Last year Xerox booked $146 million in write-downs after it acknowledged it couldn’t handle some state Medicaid contracts. Three months ago, reports surfaced that Xerox would fire 178 customer service agents and shutter its call center in the U.S. city of Cary.

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Narayan Ammachchi

News Editor for Nearshore Americas, Narayan Ammachchi is a career journalist with a decade of experience in politics and international business. He works out of his base in the Indian Silicon City of Bangalore.

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