A Conversation with Ursala Burns and George Colony – Chris Scott Graham

June 29, 2011 – East Palo Alto, CA. When two luminaries meet their combined light can illuminate issues on a variety of topics. Wednesday night, in a wide ranging conversation format presentation organized by the Churchill Club, Ursula Burns and George Colony demonstrated this principle by providing the audience with a number of insights regarding business and the nature of innovation.

Ursula Burns - CEO Xerox

Mr. Colony, the Chairman and CEO of Forrester Research, started the conversation by asking Ms. Burns to describe her role as the Chairman and Chief Executive Officer of Xerox. Having taken over these responsibilities in July 2009, a very difficult time in the industry, and after describing Xerox as a “blue collar company”, Ms. Burns reflected on the importance of being the “biggest server” in order to do the job correctly. In addition to the need to travel extensively, she felt the responsibility to explain to herself, as well as to others, what is good and not so good about what Xerox is doing, as the more one discloses to others the more they will become invested in critical decisions.

Important to her focus was the fact that a number of her decisions involved the process of changing Xerox from a pure products company to one that also provided services, and in recognizing that there is more value to add to customers that “just technology.” The transition to a services oriented company arose from the central question “what is it that we do?” For Xerox the answer to that question was to help clients/customers transform complex business problems, rather than just being a “copier company.” This insight led to the transition of Xerox to the services business after having first been developed as a technology company. To be in a position where solutions could be invented, and to deliver value at the end of the day, Xerox could not “be nervous about throwing money at R&D.” At the same time, Ms. Burns noted that the Company had to leverage what it had and was really good at, rather than just look for another business to get into.

In discussing the broader economy, Mr. Colony observed that we are still crawling up the wall of worry, and crawling out of the recession. Ms. Burns agreed that we are still in recovery mode, after a “horrible” 2009, but that business has a short memory in its attempt to get back to normal. The world, other than China, has structural unemployment that is larger by orders of magnitude than normal, with millions of people who are not working and instead drawing upon the central pool of resources provided by those who are working. The reality is that there will be years of slow growth, which in turn constrains risk taking. One of the issues faced by technology companies is the large number of engineers and technical graduates going to Wall Street or similar professions that do not add to “value creation.” Instead, their goal is to make as much money as possible as fast as they possibly can. Too few are going into industry, where they can address real problems, such as renewable energy and clean water. The gap in career choices is not just the difference in money, but also the lack of celebration of what engineers and scientists so. This becomes a question of our ability to innovate.

Conventional wisdom is that we design in California, but build in China, and that the way forward for the US is innovation. Here, China may be able to copy much of what we do, but has not yet been able to replicate our ability to innovate: how to innovate; how to use; how to get to the point where we can develop cycle/game changing ideas? If we can continue to innovate, it is not important if China or India can also develop the ability to innovate. But the educational system in the United States, apart from its universities, is woefully inadequate in this regard, as it creates people incapable of competing, a fundamental underclass. There is a problem with a system that deploys a belief that everyone should feel good regardless of their efforts, and we need to have a system where performance matters. There is a need for industry to partner with the educational system, such as through internships, to better understand that the work of engineers and scientists is both real and “pretty exciting.” Rather than wait for schools to ask, Ms. Burns suggested that companies need to volunteer and get more engaged.

Innovation is part of a value chain that includes the inventor, transformer, financier, and broker. While all four are needed for an innovation network, one does not have to do them all. Xerox sees the role of transformer as the key to the network, as that role involves identifying both the invention and its application. Likewise, trying to innovate “only within four walls” limits opportunity, with joint innovation adding more opportunity to all parties involved even as it adds risk. Through joint innovation Xerox gets better ideas and access to different ways of doing things. To be successful in this regard one has to reach out even to people one does not necessarily like. But being a transformer is absolutely required as not everything a company can make or come up with can be turned into a successful business.

Ms. Burns closed her observations by noting that the key to leadership is being able to understand that news makes things new but not necessarily important, and there is value in learning the difference between urgent and important. She suggests that one align themselves around a strategy and make sure that the people one leads are both tuned into that strategy and will work well together. One can be wrong, as long as they are right more times than they are wrong. In this regard, one has to attach oneself to a decision or opinion, and then be fearless. CSG

Print PDF