Innovation is more than Technology – The Xerox Story

Innovation is often thought of as the development of new technology, but it is much more than that. Webster’s dictionary generically defines innovation as “a new idea, a novelty”, as “the introduction of something new”. So, based on this you may say innovation is the process of creating something new, whether it’s a product, service, or process.

In today’s fast-paced market, innovation is essential for companies to stay competitive and grow. So, it’s not just about developing new products or services, but it’s about finding new ways to solve problems, improve efficiency, and create value for customers. The last part is the key, value to customers is the one that will set a company apart from its competitors.

One example is how Apple revolutionized the music industry with the launch of iTunes, and how they changed the way we communicate with the introduction of the iPhone. Apple’s success is not just about the technology it developed, but also about its ability to understand the needs of its customers and to create a seamless user experience.

Innovation is also about process, culture, and mindset. Companies need to create an environment where employees feel empowered to share their ideas and where it’s safe to take risks. They also need to have a clear vision and strategy for how to commercialize their innovations and create value for customers.

The Xerox Story

The story of Xerox’s failure to commercialize its innovation is a cautionary tale of how even a company with a strong history of innovation can struggle to capitalize on new technologies.

In the 1970s, Xerox’s Palo Alto Research Center (PARC) developed the first personal computer, the Xerox Alto. The Alto was the first computer to feature a graphical user interface (GUI) with a mouse and a desktop metaphor, which are now standard features of modern computers. However, Xerox failed to commercialize the technology, and it was instead popularized by Apple, who introduced the Macintosh in 1984.

The reason for Xerox’s failure was primarily due to the company’s focus on its core business of copying and printing, and a lack of understanding of the potential of the personal computer market. Xerox’s management at the time did not see the potential of the technology and did not invest in its development. They also did not recognize the potential of the GUI and mouse-based interface, they were more focused on developing the technology for their core business of copying and printing.

Additionally, Xerox was not able to capitalize on its innovation because it was not able to create a business model for the personal computer market. The company did not have the distribution and marketing capabilities to compete with companies like Apple and IBM, which had already established themselves in the personal computer market.

In addition to the Xerox Alto, Xerox also failed to capitalize on several other technologies that it had developed.

  1. Ethernet: Xerox PARC also developed the Ethernet technology, which is a standard for local area network (LAN) communications. However, Xerox failed to commercialize the technology and instead, it was popularized by other companies such as 3Com and Cisco.
  2. Laser printing: Xerox developed the first laser printer in the 1970s, but it was not able to commercialize the technology as effectively as competitors such as Hewlett-Packard (HP) and IBM.
  3. Network computer: In the late 1990s, Xerox developed the network computer (NC) concept, which proposed that most computing tasks could be done over the internet using a simple device connected to the network. However, the concept failed to gain much traction in the market, as it was not as versatile as a personal computer and it required a high-speed internet connection.
  4. Solid ink printing: Xerox developed a solid ink printing technology that was able to print high-quality images, but again, it struggled to compete with other companies such as HP and Lexmark.

These examples demonstrate that it’s not enough to have innovative technology, it’s also important to have the right strategy and approach to commercialize it and make it successful in the market. Xerox’s failure to capitalize on these technologies can be attributed to a lack of focus on the potential of the technology, a lack of understanding of the market, and a failure to create an effective business model.

The story of Xerox’s failure to commercialize its innovation serves as a reminder that even the most innovative companies can struggle to capitalize on new technologies if they don’t have the right strategy and approach in place. It’s important for companies to stay attuned to market trends and be open to new opportunities, and have a clear vision and business model to be able to capitalize on the technology they develop.

Having said all this, it would be unfair if I don’t mention about technologies pioneered by its materials scientists such as liquid-crystal displays (LCD), optical disc innovations, and laser printing were actively and successfully introduced by Xerox to the business and consumer markets. PARC is very much active and focuses on innovation.

In conclusion, innovation is about much more than technology. It’s about creating value for customers, solving problems, improving efficiency, and finding new ways to do things. Companies that understand this and foster a culture of innovation will be more likely to succeed in today’s fast-paced business environment.

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