An October 25, 1999, article in BusinessWeek by
D.Brady, "Why Xerox Is Struggling," reported:
President and Chief Executive
G.Richard Thoman is a big-picture guy.For the past two years, he has preached a digital revolution at the copier giant.Get down to the detail, though, and it's clear that the revolution isn't going as planned: In both copiers and printers, Xerox is losing ground.On October 18, the company announced lower than expected earnings and the stock price tumbled more than 13% on that day.Xerox stock is down 60% from its recent high of $60 in July.Xerox blamed the bad news on short-term surprises: sagging productivity in the sales force after a big reorganization as well as weakness in Brazil.But the sheer scope of bad news shocked even Thoman, who told investors in a conference call that he was "disappointed and sad about this quarter."
Thoman took the top job in April and vowed annual earnings growth in the "mid-to-high teens."
Beginning November 1, 1999, Xerox factories increased their hours from five eight-hour days a week to six ten-hour days a week through the end of the year.The factory managers were told to build inventories in expectation of higher sales in the fourth quarter of 1999.Fourth-quarter sales were expected to be higher because of anticipation that the new sales force reorganization would increase sales.Required:
Offer an alternative reason(s) for Xerox's decision to increase output in its factories.

Question

Quizplus · Accepted Answer

The Answer of An October 25, 1999, article in BusinessWeek by
D.Brady, "Why Xerox Is Struggling," reported:
President and Chief Executive
G.Richard Thoman is a big-picture guy.For the past two years, he has preached a digital revolution at the copier giant.Get down to the detail, though, and it's clear that the revolution isn't going as planned: In both copiers and printers, Xerox is losing ground.On October 18, the company announced lower than expected earnings and the stock price tumbled more than 13% on that day.Xerox stock is down 60% from its recent high of $60 in July.Xerox blamed the bad news on short-term surprises: sagging productivity in the sales force after a big reorganization as well as weakness in Brazil.But the sheer scope of bad news shocked even Thoman, who told investors in a conference call that he was "disappointed and sad about this quarter."
Thoman took the top job in April and vowed annual earnings growth in the "mid-to-high teens."
Beginning November 1, 1999, Xerox factories increased their hours from five eight-hour days a week to six ten-hour days a week through the end of the year.The factory managers were told to build inventories in expectation of higher sales in the fourth quarter of 1999.Fourth-quarter sales were expected to be higher because of anticipation that the new sales force reorganization would increase sales.Required:
Offer an alternative reason(s) for Xerox's decision to increase output in its factories.

An October 25, 1999, Article in BusinessWeek by