Xerox Corporation - Cause of Failure Competition Essay

elope Corporation - Cause of Failure Competition - Essay ExampleThese factors increased competition enhancing the need of newfangled technological innovations and new ways to compete. In the 1980s, Xerox Corporations revenue share of the copier business declined from 90 percent to 43 percent as a result of increased competition from Ricoh, Sharp, and Canon in Japan and Kodak and IBM in the United States (Contemporary Trends in Human Resources Management, n.s.). The industry of competition can be characterized as follows Xerox compete in the market for service of Xerox high volume copiers (Xerox Corporation. Creative Copier services. 2004).In general, competition theory has been develop, described and canvass by such gurus as M. Porter, C.K. Prahalad and G. Hamel, R.M. Hodgetts, H. Mitzberg, R. DAveni. They describe that to be effective, competition should not always be a formal process. Studies of the planning practices of actual organizations suggest that the concrete value of competition may be more in the future orientation of the planning process itself than in any resulting written strategic plan. The chastisement Xerox Corporation proves the fact that competition is not always a safe way to obtain a strong market position.Michael Porter contends that a corporation is most concerned with the intensity of competition within its industry. The collective strength of these kings, he contends, determines the ultimate profit effectiveness in the industry, where profit potential is measured in terms of long-run return on invested capital. (Porter, 1980). The stronger each of these forces is, the more companies are limited in their ability to raise prices and earn great profits. According to the case study started from year 2000, Xeroxs share price had fallen below $4, from a high of $64 a year earlier. Moreover, the copying and printing process giants around the world were taking chunks of its market share (Case Study Xerox Corporation, n.d.). This fail ure was caused by the fact that intense competition and management strategy aimed to chastise temporal decline resulted in failure. A strong market position obtained by Xerox Corporation resulted in less concern for US engagement (Kato, n.d.). Globalization and international integration presents Xerox Corporation with enticing opportunities and challenges to reconfigure itself. New horizons allowed Xerox Corporation to maximize its global sales, in the belief that those that offer a global service and have a worldwide success through regional policy will be in the strongest competitive position (Xerox Corporation, 2005). Nevertheless, Xerox Corporation paid less attention to such important issues as technological changes and innovations. In his book Competitive Advantage Porter identifies five forces that have competition within an industry 1. The threat of entry by new competitors. 2. The intensity of rivalry among existing competitors. 3. Pressure from substitute products. 4. T he negociate power of buyers. 5. The bargaining power of suppliers (Porter, 1985). It is important, that a strong force can be regarded as a threat because it is likely to reduce profits. In contrast, a weak force can be viewed as an opportunity because it may allow the company to earn greater profits. In the short run, these forces act as constraints on a companys activities. In the long run, however, it may be possible for a company, through its choice of strategy, to change the strength of one or more of the forces to the companys advantage. The company states that We developed a comprehensive process