Xerox CEO sees lag in U.S. science education

U.S. competitiveness at stake says Anne Mulcahy at university forum

By: Alex Gennis
   Revitalizing science and engineering education is essential to maintaining U.S. competitiveness in the global economy, Xerox Chairman and Chief Executive Officer Anne Mulcahy told Princeton students and faculty recently.
   "Failing to invest in our future and to nurture our own technological infrastructure is a very big problem and will certainly have consequences down the road," she said in a public talk held on April 5 at the university’s Friend Center. "If you stop investing today in future capabilities there are a lot of consequences to pay down the road," she said.
   Scientists have played an essential role in America’s prosperity, but as the number of American scientists relative to the number of scientists in other countries has decreased, the U.S. has begun to lose its competitive edge, Ms. Mulcahy said.
   "The ability to innovate is why we have had a steadily widening middle class," she said. Countries such as China and India already have gained an edge in educating scientists and engineers. "Today 21 percent of all science degrees are awarded by Chinese universities," Ms. Mulcahy said.
   Federal funding for the advancement of science has fallen by a third since the 1970s and today the U.S. is behind many countries in educating scientists, ranked 17th in the world in the number of science degrees awarded, Ms. Mulcahy said.
   "Just in a time, when we are in dire need of the kinds of skills that we need to keep our companies growing, we are failing," she explained. "The fixes begin downstream in primary and secondary education." Ms. Mulcahy said the problem should be addressed by the business, government, and education sectors working together. Xerox has begun to address the problem by funding scholarships and science labs in high schools.
   Promoting diversity is an important part of the solution to the nationwide shortage of science degrees, Ms. Mulcahy said. "The talent base has to be more inclusive," she explained. "We really have to include 100-percent of the population.
   Ms. Mulcahy said that she learned the importance of investing in the future during her campaign to save Xerox from near bankruptcy, which re-established the company’s position as an industry leader.
   Even during the worst time of Xerox’s performance, when it was saddled with close to $19 billion of debt, the company’s research and development department maintained its full budget, Ms. Mulcahy said. "We didn’t take a dollar out of R & D. It was a pretty contentious decision and one that had to be defended," she said. "Trading off the future was not going to be a reasonable conclusion for us."
   Today, Xerox’s sales are primarily driven by its latest products, a result of continuing to invest in the development of future technology. "Seventy percent of our revenues come from products introduced in the past two years," Ms. Mulcahy said.
   Xerox’s cost-cutting campaign was another strategy Ms. Mulcahy employed to help the company get out of debt. "We were ruthless in cutting costs because we had to survive," she explained. "We put an incredible focus on cash."
   Although not an engineer herself, Ms. Mulcahy believes that she was able to build one of the best engineering teams in the country. The ability to criticize, and alignment around a common set of goals are essential to a successful team, she said.
   "One of the most important competencies of big companies is the ability to listen," she explained. "It gives them the opportunity to identify problems and opportunities early."
   As Ms. Mulcahy was struggling to pull Xerox out of its crisis in 2000, she met with Warren Buffet, the legendary chief of Berkshire Hathaway Inc. His advice: "to focus on customers and to lead your people as if their life depended on your success." Taking Mr. Buffet’s advice, Xerox was able to respond to customers’ needs by focusing on products they wanted, while maintaining loyalty and dedication of employees.
   "Business is a lot simpler than a lot of people make it look," Ms. Mulcahy said quoting Mr. Buffet. "We learned that often the way out of trouble is ‘back to basics,’" she added.