Xerox chief charts her new path

by Patricia Sellers

Ursula Burns

While ideal partners at the top of Xerox (XRX), Anne Mulcahy and Ursula Burns stand apart in terms of strengths and style. Mulcahy, who was CEO and is now chairman, is a sales ace and strategist who brought Xerox back from the brink a decade ago. Burns, who rose from intern to president of the company, is a brass-tacks engineer who embraces execution and always got the job done.

Today Burns is, as you probably know, CEO of Xerox. This transition--the first time a woman succeeded a woman at the top of a Fortune 500 company--took place last July 1. Yesterday, when Burns came to Fortune's offices for lunch, I was struck by how quickly and comfortably she seems to have settled into her new role.

Being chief has been "more fun" than she anticipated, she said. Maybe that's because Burns hasn't needed to fill her days with ceremonial spin on the vision thing. (Vision-setting is "overrated," she told us.) Burns had her work cut out for her from the get-go. On the day before she took charge, she explained, she met Lynn Blodgett, the chief of ACS, in some covert location in Dallas to talk about acquiring his company.

Burns worked intensely on that acquisition plan until the deal was announced last September. Then, hitting the road to secure shareholder approval for the $6.5 billion purchase, the largest in Xerox's history, was consuming. By executing the deal,  Burns demo'ed her vision. Which is? To expand Xerox in services.

As Burns views the competitive field, all the big tech players--IBM (IBM), Hewlett-Packard (HPQ), Dell (DELL), and even Apple (AAPL), which tops Fortune's just-released list of America's Most Admired Companies--must hone in on services. Product prices are falling and will continue to do so, she says, because consumers and customers are simply unwilling to pay up.

Now, large customers, in particular, are not showing signs of increasing their demand for tech equipment, she added. They're delaying upgrades, as their costs keep rising and opportunities to lift their revenues look spotty.

So, how is Burns plotting to use ACS to bolster Xerox? Not by slashing ACS's 78,000-person workforce (which is bigger than Xerox's), she insists. Noting that ACS derives just 8% of its revenues internationally, vs. more than half for Xerox, she explained that she wants "to internationalize" ACS' workers. That is, Burns wants each warm body in the Xerox organization to produce more revenues. A global challenge worthy of someone skilled at getting things done.