Fuji Xerox has shifted its management from an internal company system to a business group structure, effective April 1, 2004. The primary aims of the new configuration, which consists of business groups and functional units, are to consolidate a companywide structure, accelerate business growth and enhance the effectiveness of specific functions.
The Office Product Business Group has been newly established to complement the existing Office Services Business Group and Production Services Business Group, which were introduced in October 2003. These three business groups, along with Fuji Xerox Printing Systems Co., Ltd., which became an independent entity in April 2003, will operate in four distinct strategic territories. In addition, four functional units, namely Sales & Marketing Group (domestic sales), International Business Group (international sales), Development & Manufacturing Group and Corporate Research Group, in conjunction with the Headquarters, which handles personnel and legal affairs among others, will make up the new functional unit structure.
Fuji Xerox established a function-based internal company system in January 2001, aiming to boost autonomy in areas such as development, manufacturing and sales. This, however, led to business duplication in direct divisions, notably personnel, accounting and general administration. It also became difficult to coordinate the separate units with headquarters and in to an optimal, cohesive whole, and often slowed down decision-making.
To further boast management efficiency, the company cut the number of departments from 390 to 230, and whittled an eight-tiered management structure, from directors down to regular employees, into five layers. A review of roles and positions will concentrate authority and speed up decision-making, while reinforcing the performance-based system.
These structural reforms, coupled with exclusive manufacturing transfer
to China and other strategic initiatives are expected to result in more
than 30 billion yen worth of cost reductions in fiscal 2004 and an operating
profit margin of 10 percent by fiscal 2006.
