How Xerox Saved $100M Over Breakfast

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Xerox saved itself $100 million over breakfast.

It had nothing to do with the food they ate or the coffee they drank.

It had everything to do with a delicate balance of process and practice.

Chatter at Breakfast

Anthropologists at Xerox’s Palo Alto Research Center (PARC) noticed a unique way customer service reps addressed machine repair problems.

Their solutions were improvised and strayed far from the paths their reference material set out before them. The playbooks and documented repair processes couldn’t possibly reflect the spectrum of unpredictable malfunctions they faced in the field.

So where did the reps turn for answers that their manuals didn’t have?

To their colleagues sitting around them at the breakfast table.

Colleagues sharing ideas during breakfast in the cafeteria at work
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Informally, over the pre-shift meal and during leisure time, the crew talked shop. Questions, theories, debates, and eventually answers surfaced about the changing nature of their work.

The reps established a shared language and began growing a catalog of (undocumented) processes. But this was a group of about 12, a microcosm of some 25,000 Xerox reps worldwide. How could the corporation distribute this knowledge throughout its entire workforce?

First, we need to understand the tightrope this puts managers on, and how they can walk it.

Reengineering and Knowledge Management

Reengineering through process relies on the belief that it’s easy to systematize value and innovation.

Knowledge management through practice relies on the belief that value and innovation come from unpredictable places.

On one side is analytical, top-down stiffness. On the other, creative, bottom-up chaos.

In their contribution to the May-June 2000 HBR publication, John Seely Brown and Paul Duguid drew upon their experience working at Xerox PARC to elucidate the source of this friction:

“Process and practice do not represent rival views of the organization. Rather, they reflect the creative tension at the center of innovative organizations.”

Striking a balance between process and practice requires subtlety. Leaning too far in either direction will cause, at least, inefficiency and inaccuracy.

Customer service representative fixing a malfunctioning copy machine
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For example, Xerox could have instructed managers and process designers, who are distant from actual daily practices, to redesign workflows and standard operating procedures. They also could have relinquished all control of processes to the reps, allowing everyone to contribute their own favorite strategies to a database no one finds particularly useful.

Instead, they created a hybrid system of process and practice that helped them stride along the tightrope.

The Eureka Project

Xerox set out to create a database to preserve ideas and share them with everyone who needed them. Their solution put power in the hands of the reps to both supply and vet tips proposed for the database.

It wasn’t top-down, coming from process designers spit-balling uninformed practices. It wasn’t entirely bottom-up either, becoming an echo chamber for every rep to throw in their two cents. Tips underwent rigorous screening before they became available to reps worldwide via the Eureka database.

A team workshopping a new idea during a meeting
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The reps, behaving as the scientific community does regarding recognition and money, rejected pay for their tips being published, favoring instead for their names to be attached to the tips.

Today, the database holds over 30,000 records, and Xerox service reps continue to enjoy the recognition they receive for contributing to the shared bank of knowledge.

Xerox’s elegant strategy for balancing process and practice saved the company an estimated $100 million.

Find Your Own Balance of Process and Practice

Xerox created a structure that made it easy for employees to source accurate strategies for complex problems. The processes as they appeared on paper were not so simple.

We can learn from their research and execution to pay attention to the reality of practice and implementation to better inform how processes can enable our people’s best work. As Brown and Duguid said:

“…the processes that support how people work should be deeply informed by how they already work.”

Often these sorts of processes need to encourage collaboration and improvisation rather than stifle momentum with rigid prescriptions.

Did you notice how social the service representative job is, compared to how independent management first perceived it to be? Colleagues, not playbooks or manuals, were their most valuable resources. Keep this in mind as you dream up new ways to enable your teams.

If you can walk the tightrope of accumulating tacit knowledge and then effectively reissuing it as process, you might far exceed the successes you dreamed about.

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