based on the below case study, could you please share what are the possible question based on the strategic management course and the answers?

CASE 1: Xerox-The Beginning READING 6.2 Xerography-50 Years of Technological Innovation J. Mort Xerox Corporation, NY, USA In the fifty years since the first xerographic copy, "10.- 22.- 38 Astoria," was made by Chester Carlson in Astoria, New York, xerography has established itself as one of the major successful technological innovations in history (Mort, 1989). Today, this technol- ogy generates billions of dollars in revenues and more than one trillion documents worldwide annually. This fact alone establishes it as a paradigm of successful innova- tion. Xerography also affords an opportunity to examine how an innovation can evolve or renew itself; although originally used almost totally for document copying, xerogra- phy has now emerged as a major component in the burgeoning fields of document cre- ation, processing, and desktop publishing. Xerography involves the confluence and interplay of a number of disparate develop- ments in science, technology, and business. It employs a broad range of materials and physical phenomena, ranging from non-crystalline or amorphous solids to polymers, photoconductivity, and triboelectricity, for which little scientific understanding initially existed. The subsequent evolution of xerography depended on scientific and technologie cal progress, not only in these diverse areas but also in originally unrelated fields, such as digital solid-state electronics, word-processing computers, and lasers. Of equal impor- tance in the initial and later innovations was the role of entrepreneurial businesspeople, innovative marketing strategies, and the final arbiters of any innovation-the customers.At the outset, it is helpful to define terminology, since terms like invention, innova- tion, technology, and science are subject to a variety of interpretations. Invention is nothing more nor less than an idea for a better way of doing or using something, al- though it often involves a rudimentary feasibility demonstration. Technology develop- ment is concerned with transforming the original invention into materials and with the device specifications sufficient for product conceptualization and the definition of the manufacturing processes. Technological innovation, on the other hand, means the prof- itable marketing of a product. The roles of science and technology in innovation are the subjects of much discussion and research activities are often classified, as if neatly dissectible, using terms such as "basic or pure" science, applied science, and technol- ogy. Such terms can be misleading if the inference is drawn that fundamental differ- ences exist in the methodologies involved. In this context, science has to do with the acquisition of understanding as an end in itself, whereas technology is the acquisition and application of knowledge for the production of a product; the methods may be the same but the goals are different. Scientific understanding can be the primary catalyst for a technological innovation, as was the case for solid-state electronics (Braun and MacDonald, 1978), although it is a misconception that science is an essential precursor to technology. More often than not, purely empirical approaches without a clear understanding of the basic principles involved lead to innovation; such was the case with xerography. Once an innovation is successful, however, empiricism can be inefficient and costly, particularly in a compet- itive environment. In such a situation, the establishment of a body of understanding leading to quantitative specification of the critical parameters for materials, processes, device operation, or markets is vital for further improvements or maintenance of market leadership. This brief paper attempts to delineate the roles that each of these elements played in the story of xerography and presents a discussion of the generic lessons that may be drawn for the successful management of future technological innovation. INVENTION: THE CREATION OF XEROGRAPHY The most important determinant of a successful innovation is that it satisfy a discernible need or create a demand. Although in the case of xerography a market-pull was identified, the enormous commercial success came about without its full market potential being ini- tially recognized. Thus, improved or more efficient ways of making copies of documents were generally seen as more of a convenience than a necessity, carbon copies being of suf- ficient quality to fulfill the need for cheap, convenient, archival copies. Carlson, more acutely aware of the market need due to his work as a patent attorney, thought differently. Like most inventions, xerography did not materialize out of thin air. Various prod- ucts, for example, were available in the 1930s for producing copies, but were complex, time-consuming, and expensive. Technically, the production of images based on the ability of electrostatically charged insulators to attract triboelectrically charged powders was well-known; indeed, triboelectricity, charging produced by friction, was first recorded by the Greeks hundreds of years before Christ. Such phenomena, however, were largely viewed as scientific curiosities until the early twentieth century when seri- ous efforts began to develop what became known as electrography for reproducingimages. Selenyi and others investigated the concept of charging an insulator with an image-wise pattern of charged ions. This required the scanning of an original document, line by line, with a light-sensitive scanner to produce an analog voltage then used to modulate the output from an ion source. Copies could thus be produced by displacing of a document-size, insulating layer beneath a stationary ion source and rendering the re- sultant charged image visible or developed by dusting with a triboelectrically charged powder. Carlson's invention was to combine such electrostatic charging and development with the phenomenon of photoconductivity, first discovered in selenium crystals in the 1870s. Photoconductivity, or the enhancement of the electrical conductivity of a mater- ial by illumination with light, has the major advantage that the image of a complete document to be copied can be simply projected onto a page-sized photoconductive layer, the photoreceptor, uniformly charged with ions. The reflected light from the doc- ument then produces selective photodischarge proportional to the incident light inten- sity in the photoreceptor. The resultant image, consisting of the remaining surface charge, replicates the information content of the document and can be developed by its electrostatic attraction for charged powder. In the original reduction to practice, the powder image was transferred from the surface of the photoreceptor to waxed paper by simple pressure to create the final copy. Carlson called his invention electrophotography (Williams, 1984; Carlson, 1965). TECHNOLOGY: THE DEVELOPMENT OF XEROGRAPHY Carlson's original demonstration was far from being a technology. The photoreceptor used was a sublimed sulfur film with little sensitivity to visible light; the developer was lycopodium powder; and the initial charging of the sulfur involved rubbing with a hand- kerchief. Given this rather primitive state of affairs, it is not surprising that the quality of the image produced only established the feasibility of the invention and much work remained to transform it into a viable technology. Carlson spent the next six years try- ing to generate support for the required development work, but despite his contacting many companies, no one was sufficiently impressed to take up the challenge. The first significant break came in 1944 because of a chance encounter with Battelle Memorial Research Institute in Columbus, Ohio, which supplemented its income by soliciting contracts from industry and government agencies. On a visit in 1944 related to his work as a patent attorney, Carlson mentioned his own patents on a new copying process. By good fortune, Battelle was thinking of establishing a research group in graphic arts and, despite the obvious problems with Carlson's invention, felt substantial contributions could be made with their expertise in chemistry and physics. As a result, Battelle ac- quired exclusive rights to Carlson's patents and agreed to give him a substantial share of any proceeds from subsequent profits. In return, Carlson agreed to commit $3,000 to pursue development of the invention. The first approaches were a search for better pho- toconductive and developer materials, better conditions for obtaining sharper images, and the best means for rendering these latent electrostatic images visible, consistent with an ability to transfer them to paper.A 1944 article published in Radio News magazine came to the attention of the Haloid Company, a small photographic paper manufacturer in Rochester, New York. The com- pany sold photocopying products based on wet chemistry, directly to the customers, using a large force of salesmen and demonstrators. As a result of reading the article, the president of Haloid, Joseph Wilson, and his research director visited Battelle to look at the new invention that might enlarge their business opportunities. They were suffi- ciently interested for Haloid to commission market research to see if a market for a new copying device existed. Inevitably, the results were ambiguous because the product was hypothetical and the most basic questions as to advantages, cost, size, and speed could not be answered. Still, Haloid's interest grew, and in 1946 an agreement was signed in which Haloid supported the Battelle research at a level of $25,000 a year, beginning in 1947; this was a major risk considering that in 1947 the company had a net income of only $138,000 on net sales of $7 million. As a result, essentially all the research on Carl- son's invention in the period 1944 through 1948 was carried out at Battelle, initially using its own funds but with the later support of Haloid. During this period, important advances were made that enabled the ultimate commer- cialization of electrophotography. The highly photosensitive amorphous form of sele- nium was discovered independently in the mid-1940s by two laboratories searching for large-area thin-layer photoconductors for applications in imaging devices. One of these was the RCA Laboratories, which was exploring vidicon technology involving the use of photosensors in television cameras. The other was at Battelle, where better photoreceptor materials for Carlson's invention were being sought. In fact, the requirements for both technologies are very similar in that the photoconductive layer must have a sufficiently high resistivity to ensure that in the dark the voltage produced across the film by charging with an electron beam (vidicon) or ions (electrophotography) does not discharge until ex- posed to the optical image. Other improvements involved ion-charging processes, elec- trostatic transfer, and dry-ink or toner materials and processes for their manufacture. INNOVATION: THE MARKETING OF XEROGRAPHY With these various improvements, commercialization moved closer to reality. This raised the issue of disclosing the technology publicly to protect the significant Haloid investment, avoid pre-emption by any unknown photoprocess, and more significantly, to attract the additional financing required for product development. It was also decided that the name electrophotography did not convey the required aura of a new, unique in- vention, and the Greek words for dry, "xeros" and writing or drawing, "graphein," were combined to give the name xerography to the invention and Xerox (sic) as a tradename. The public announcement of the new technology was made at the meeting of the Opti- cal Society of America on the tenth anniversary of the first xerographic copy. The in- vention of the transistor, ultimately to greatly influence the evolution of xerography, had already been announced on June 30th, although neither was a product at the time. In the same year, the U.S. Army Signal Corps awarded a grant of $120,000 to Haloid to de- velop a dry photographic process. This proved a major stimulus both to the morale of those involved and the future development efforts.The first product, the Xerox Copier Machine, Model A, announced in 1949, was field tested by loaning units to four large companies who found them of little value, since their manual operation was complex and copies of acceptable quality were operator de- pendent. The obvious solution was to automate the process, but major technical uncer- tainties existed as to its cyclic stability. In any case, this required further substantial investment and the experiences with the Model A made external investors even more wary of getting involved. At about this time, however, it was realized that the process could be used to make offset lithographic master plates by transferring the developed image to a specially prepared offset master plate. On small lithographic presses, such offset plates could produce large numbers of copies quickly at low cost. However, the masters produced by conventional methods required an hour to make and cost several dollars each. By contrast, the master made by xerography cost 30-40c per plate and turned out copies within minutes of receiving the original. This was an important niche for the embryonic technology, and it also provided cash, knowledge and experience, all of which were needed to achieve the objective of automating xerography. The next xerographic product, the CopyFlo printer, introduced in 1955, was the first automated xerographic product and enabled the production of copies on a continuous web of ordinary paper. By 1955, Haloid's annual sales had reached $21 million, of which almost 50% came from xerographic products. As recognition of this fact, the name of the company was changed to Haloid-Xerox Inc. The company also bought from Battelle the original Carlson patents for 50,000 shares of Haloid-Xerox stock, worth about $4 million. These transactions had substantial implications for the com- pany's cash-flow position, as did its decision to lease rather than sell its xerographic products, since by leasing Haloid-Xerox retained legal ownership and the significant tax advantages of depreciation. As a result, from 1951 to 1955 the company's cash flow im- proved from $720,000 to more than $2 million. In 1958, it was decided to enter the office copying machine market with the Xerox 914, so named because it would make copies on paper up to 9" X 14" in size. Signifi- cant research and engineering had to be done even to demonstrate the first model, in- volving, as it did, a coated amorphous selenium drum, optical systems, paper feeder, paper transport, fusing, and more. Based on the results of the first prototype and man- ufacturing cost estimates, it became obvious that millions of dollars would have to be expended to bring the product to market. Given the risks involved, several large firms were approached to see if they would manufacture the product for Haloid-Xerox in return for a share of the profits. Market surveys made for these companies, confirm- ing similar ones done for Haloid-Xerox, estimated the maximum number of units that would be sold over the life of the 914 at no more than 3,000. These estimates were in part based on the extant market in which automatic copying already existed, include ing electrophotographic products introduced by RCA using paper coated with dye- sensitized zinc oxide. Such coated papers met market resistance in terms of esthetics and cost, so in 1958 the total market was only about $100 million. Moreover, the 914 represented radical departures from the existing copiers, and despite the touted advan- tages of xerography, these departures were viewed negatively. First, the projected size of the 914 was considered too bulky and heavy, at 650 pounds, for the office. Second, in terms of a conventional sales approach, the cost of an outright sale was high. Con-sequently, the 914 generated no euphoria in either market researchers or other compa- nies. Haloid-Xerox was thus faced with the choice of establishing its own manufacture ing capability or abandoning the whole venture. They chose the former path and the rest is history. As great as Carlson's invention and the skills of the Haloid and Battelle technical staff, they were matched by the creative marketing necessary to complete any success- ful innovation. A major role in the development and implementation of the new market- ing approaches was played by C. Peter McColough, a future president of the Xerox Corporation. These approaches had a number of interrelated elements, but a critical fea- ture was the use of a two-tiered pricing structure. This was based on the premise that the ultimate cost to the customer should be a function of the number of copies produced. First, the base price, including a number of "free" copies, was set sufficiently high to en- sure an acceptable return, yet sufficiently low, on a per copy basis, that customers would consider the 914 worth the charge per copy. In addition, the base price, ultimately set at $95, had to be low enough and the contract term short enough to reassure any customers concerned about their investment risk. Meter pricing was then used so copies in excess of those included in the base price were charged to the customer. As a result, the higher the utilization of the machine, the higher the revenues and profits. This, in turn, justified the required establishment and maintenance of a nation-wide sales and service force. The latter, essential for a leasing strategy, also provided a mechanism for facili- tating the diffusion of the 914. Such marketing innovations, just as the technical aspects of xerography, were in some respects evolutionary in that they built on Haloid's earlier experiences in direct marketing. The Xerox 914 copier, first shown in September 1959, was a fully automatic machine requiring no special skill or adjustments to operate. Although basic by modern stan- dards, it produced seven copies per minute on plain paper with a reusable photorecep tor. The image, composed of a carbon-black impregnated polymer toner impervious to degradation by light or chemicals, was ideally suited for archival storage. The impact was phenomenal and caused a revolution in both the copier industry and the office. In contrast to the market predictions of 3,000 placements over the life of the product, a total of over 200,000 were sold, with a peak population of approximately 65,000 units reached in six years. A monthly copy volume of 50 million in September 1961 climbed to 490 million by March 1966. The inexorable growth of Xerox's business was slowed by neither economic recession nor seasonal fluctuations, so the financial impact was equally dramatic. The revenues of Haloid-Xerox in 1960 were $37 million, of which only $3 million were from xerography. One year later the revenues of the newly named Xerox Corporation had leapt to $59.5 million, and by 1966 were $428 million. In 1986, the total copier business world-wide for all companies had grown to roughly $20 billion. and the annual total number of copies made approached 1 trillion. Impressive as these figures are, the evolution and growth of xerography should not be described only in terms of financial success. Behind the numbers lies a story of continued research and ad- vances in materials, process, and product concepts which have led to dramatic im- provements in xerographic technology and product value to the customer. Likewise. parallel developments in other areas of science occurred during the years in which Carlson, Wilson, and others struggled to make xerography real. These apparentlyunconnected advances ultimately impacted and enlarged the capability of xerography beyond anyone's expectations. SCIENCE: THE IMPROVEMENT OF XEROGRAPHY The genesis of xerography did not lie in science, except insofar as all progress builds on accumulated knowledge. Hence, although much use was made of electrostatics, photo- conductivity, and materials, this was done to a large degree empirically. Moreover, at the time no understanding of the materials or processes associated with amorphous photo- conductors or developer materials existed at anything approaching a fundamental level. As a result, early problems in production or performance had to be solved on the run using a combination of limited insight and intuition. While this provided sufficient op- erational know-how to permit the technology and product development of the Xerox 914 copier, a more systematic approach was clearly essential for future improvement in the technology. Consequently, xerography is an example of a technological innovation that gave birth to new scientific fields of study. Carlson's invention had provided a new way to create copies using photoconductive, non-crystalline thin films. Glass is the most familiar member of a general class of mate- rials known as amorphous solids. Unlike the atoms of crystals, which are distributed with uniform order in three dimensions, the atoms in amorphous materials are distrib uted randomly. Freed from the constraint of positional order, amorphous materials can be easily produced in large areas of arbitrary shape, at low cost, and as a result glass is a centuries-old technology. Still, there was nothing to suggest that such materials were even remotely interesting from the perspective of photoelectronic properties; indeed, glasses were viewed as quintessential high-resistivity insulators. Even more striking was the fact that the scientific community had initiated no coherent or sustained re- search on amorphous materials as of 1960. Undoubtedly a number of reasons accounted for this. First, the field of solid-state physics in the 1940s and 1950s focused almost ex- clusively on crystalline solids. Not surprisingly, these were viewed as being the most fruitful area of endeavor, given the fact that for scientists they appeared the most tractable. The dramatic discovery of the transistor and research in crystalline silicon only heightened this focus as more and more laboratories, particularly those in industry, competed to find another proverbial pot of technological gold in the world of crystals. By contrast, the attraction of research in amorphous materials and phenomena like tri- boelectricity was not widely appreciated or pursued. Therefore, despite the successful innovation of the Xerox 914 and the critical role of photogeneration and the movement of charge in amorphous selenium, the first direct, unambiguous measurement of these properties was not made until the late 1950s when a tentative start was made to under- stand the materials and phenomena involved in xerography in a more fundamental way (Mort, 1983). This required not only new interpretations of the electrical, structural, and thermomechanical properties of solids and the phenomena of electrostatics and tribo- electricity, but even the development of appropriate measurement techniques to system- atically characterize these properties. Amorphous selenium played a central role in the phenomenal success of xerography. Despite this, selenium had some definite shortcomings in terms of the future evolutionof the technology. First, it exhibited a propensity to crystallize, although solutions to this particular problem were found. Less easily remedied shortcomings were its lack of pho- tosensitivity to red light and intrinsic lack of flexibility. From an engineering perspec- tive, considerable virtue was ascribed to having flexible photoreceptors and, by using a materials engineering approach, amorphous selenium belts were produced by Xerox in the 1970s for use in the high speed Xerox 9200 machines. Another impetus, arising from business considerations, was the need for cheaper photoreceptors to reduce costs and make the products more affordable for the customer. The combined needs for extended spectral response, flexibility, and low cost were, therefore, major driving forces to iden- tify alternative photoreceptor materials and devices during the 1960s and 1970s. The advances capitalized on the accumulated insights on the first generation of photorecep tors, an improved understanding of the amorphous state in the wider scientific commu- nity, and the identification of its relevance to actual device performance. Alternatives to amorphous selenium and its alloys in terms of flexible thin-films exist in organic poly- mers, and it was thus natural that attention of research laboratories turned to these ma- terials in the 1960s. Polymers are a particular class of organic compounds which have distinctive charac- teristics, including outstanding flexibility, transparency, impact strength, and chemical inertness. They consist of molecular units connected together, much like a string of pearls in a necklace, to produce chains which may contain millions of these sub-units. Many polymers are glass-like in that the chains do not line up or chemically bond to each other and so can be produced cheaply in large sheets. Despite these desirable me- chanical and chemical properties, polymers, like inorganic glasses, generally constitute some of the best electrical insulators known. Initial studies on the electrical properties of organic materials in general and polymers in particular, however, created the hope that coupling creative chemical synthesis with an understanding of the organic solid- state might yield a combination of electronic function and desirable mechanical fea- tures. Today, polymeric-based photoreceptors using polymers molecularly doped to make them electronically active are widely employed by the xerographic industry. Since the polymers themselves typically do not absorb visible light, they are combined with a second thinner photogenerator layer whose function is to act as the photoconductive element. Usually this photogenerator layer is overcoated with the thicker, doped-charge transport layer in order to protect it. Comparable advances in the understanding of poly- mer chemistry and physics have led to the formulation of toners with improved charac- teristics for fusing properties, life, and color in developer applications. EVOLUTION: THE EXTENSION OF XEROGRAPHY The evolution of xerography, as with other innovations, has been profoundly influenced by developments in other fields, although when such advances occurred their relevance was initially less obvious than it seems with hindsight. In itself, the notion of using xe- rography in electronic publishing is less than a giant step, since Selenyi's work in the 1930s and a xerographic computer printer of the late 1950s pointed in that direction. However, two critical elements were missing: the capability to effectively exploit the idea and, just as important, the need and motivation to do so. The first required ameans to easily and efficiently write in faster fashion with a light beam. This had to await the laser, although nothing could have been further from the thoughts of the scientists responsible for its discovery in 1960. This discovery was followed by the necessary development phase that made possible a practical, affordable, and reliable device, so it was only in the mid-1970s that xerographic laser printers became a reality (Starkweather, 1980). The emergence of a major market for such printers, however, was also predicated by increased use of electronic data processing in the world of text and graphics. First and foremost, this required the infiltration of computer technology into the office. The time constant for this to occur in a substantial fashion was essentially a decade, despite the absence of intrinsic technical limitations. The primary roadblock was cost, so the rate of decline in the price of semiconductors due to advances in inte- grated circuitry and the increased computing power per dollar it enabled were of greater importance. Xerographic printing and its role in desktop publishing, therefore, was a consequence of the maturing of both computer and xerographic technology, leading to their eventual coexistence in the office, together with the rise of digital data and network transmission technology- CONCLUSIONS: THE LESSONS OF XEROGRAPHY Xerography is a classic example of a successful technological innovation and therefore worthy of emulation. The difficulty exists in delineating what lessons one should draw. By any criteria, the innovation of xerography was an exceptional event, and it is hard to imagine that the unique collection of circumstances surrounding its birth can be preor- dained. The best that can be done is to highlight the individual ingredients that synergis- tically proved so successful. It is logical to start not at the beginning but at the end of the process, for no matter how exciting an invention or impressive a technology, unless there is success in the marketplace no innovation has occurred. The ultimate determining fac- tor, therefore, was the customer. Even in this respect, no easy answers exist, since re- peated market surveys did not reveal the latent market potential of xerography. This is not to denigrate the use of marketing research, where for evolutionary or commodity prod- ucts numerous successes can be documented. Rather, it suggests its limitations when ap- plied to revolutionary technological innovations. Here, both researcher and customer must grapple with the implications of a product that enables capabilities beyond experi- ence or imagination, and it is extraordinarily difficult to ascertain with any degree of con- fidence the needs of the marketplace (Braun and MacDonald, 1978). On the other hand, the innovative marketing strategy, employing the leasing approach, proved central to facilitating customer acceptance and the subsequent diffusion of the 914 copier. It has been said that xerography was an "invention nobody wanted" with the clear im- plication that it should have been. Retrospectively, this is a tautology since technologies, still less innovations, do not materialize in ready-made or recognizable form. Thus the rejection of xerography twice, first on the grounds that it was an invention with little technological promise, and second, because it was a product concept without a market, occurred for totally rational technical and business reasons, on the basis of the facts known at the time. Therefore, for a technological innovation to have a chance of success it must have one or more champions who believe: xerography had two, first and alwaysCarlson, and later Wilson. Individually or collectively, such champion(s), must have, in addition to faith, an unusual combination of technical and business judgment and, given a lack of complete information or control over events, a good intuitive sense. Even these are no guarantors of success, however, and the value of luck cannot be denied. In the case of xerography, all were involved. The technological development of xerography initially occurred in a phenomenological fashion, although no less impressive for that. In fact, given the melange of interdependent phenomena and materials involved, it is hard to imagine that it could have evolved effectively through a reductionist approach in which the various technology parts were independently investigated for later integration. For research, whether internal long-range research targeted at a technology, or discoveries generated in the external scientific community, it has two general characteristics. The first is that, because it is knowledge-limited, there is inevitably a phase lag with the im- mediate needs of developing technology. Technologists and engineers struggling with the everyday necessity to converge on a set of materials and process specifications have totally different time constants for integrating new ideas into technology. Second, scien- tific discoveries in the widest sense, including, for example, new manufacturing processes, may occur with no evident relevance but which ultimately, sometimes much later, become enabling. Obviously, new technologies should not be incorrectly identified as successful innovations, no matter how impressive they may appear, but neither should they be prematurely evaluated; as with many endeavors, timing can be everything. Ex- amples from xerography of the first characteristic is the study and understanding of charge transport in amorphous materials, including polymers, which over a decade of re- search led to the materials engineering of organic photoreceptors. Examples of the sec- ond include the development of integrated circuit processing technology leading to the desktop word-processor, or the discovery in 1960 of the gas laser, followed by the solid state laser of the late 1970s which now enables desktop laser printers. As a coda, the question has been raised as to whether innovation is a game of skill played with chance, or a game of chance played with skill (Braun and MacDonald, 1978). The story of xerography, which, while differing in details, has remarkable paral- lels with other innovations, suggests that the answer is both. Reading 6.2 References Braun, E., and MacDonald, S. (1978). Revolution in Miniature, Cambridge, Cambridge Uni- versity Press. Carlson, C. F. (1965). Xerography and Related Processes, edited by J. H. Dessauer and H. E. Clark. Chapter 1: "History of Electrostatic Recording," New York, Focal Press. Mort, J. (1983). "Amorphous Semiconductors: From Selenium to Silicon," Journal of Mate- rials Education, vol. 5, 197. Mort, J. (1989). The Anatomy of Xerography, and references therein, Jefferson, NC, McFar- land & Company Inc. Starkweather, G. K. (1980). "High-Speed Laser Printing Systems," Laser Applications, vol. 4, 125. Williams, E. M. (1984). The Physics and Technology of Xerographic Processes, John Wiley & Sons, Inc., New York.Lessons from Xerox: The Beginning The case study about the invention of xerography has been presented here for many rea- sons. First, it demonstrates the anatomy of the innovation process and illustrates the complexity of such a process along with the many factors that lead to innovation. It also demonstrates the differences between scientific discoveries and technological innova- tion, showing how a purely empirical approach without a clear understanding of the basic principles involved can lead to innovation. Yet once the innovation is headed to- ward success, pure empiricism can be insufficient. The inventor was a patent attorney, an entrepreneur, not an engineer or scientist but a man with a vision, an idea, a passion for this idea, and persistence. Carlson spent six years trying to generate support for his idea. His first break came when Battelle became interested in his idea. Battelle brought to the process important knowledge, talent, and scientific approaches. Haloid's Wilson found out about the idea by chance. However, being a visionary, entrepreneur, and venture capitalist in his own right, he moved quickly to support Battelle's research (with $25,000). Being a businessman, Wilson, and Haloid, moved to protect the technology by giving it a trade name. The U.S. Army, a frequent supporter of basic and applied research of interest to its operation, moved to support Haloid's development effort with a $120,000 grant. Finan- cial support by third parties and by government bodies is frequently the catalyst that propels new ideas toward development and marketing The first Xerox machine was announced in 1949. Yet it took several innovations to improve it and bring its technology to a level acceptable by the marketplace. The initial predicted market size for the early-generation Xerox 914 copy machine was 3,000 placements over the life of the product. By any traditional accounting method, such as return on investment (ROD) or rate of return (RR), this was a volume that would not jus- tify further development of the product. In reality, more than 200,000 machines were sold. A revolutionary innovation that was touted as a product concept without a market indeed created an unexpected and phenomenal change in the marketplace. When dealing with revolutionary innovations, market surveys and predictions cannot be trusted to account for the expected change. Meanwhile, it was a marketing innova- tion that facilitated customer acceptance of the product. A leasing and pricing structure introduced by Peter McColough helped to overcome the obstacle of the machine's ini- tial cost of an outright sale. This strategy certainly helped the diffusion of the 914 ma- chine and retained legal ownership of the product with significant tax advantages of depreciation. Once the technology was well developed, accepted by the market, and dif- fused, a huge explosion in the volume of copies produced ensued. The company's rev- enues multiplied. The following MOT lessons can be drawn from this case: 1 The success of an invention is dependent on its marketability. 2 Multiple generations of innovations may be required to facilitate customer accept- ability of the product. 3 Market surveys have limitations when used to predict the impact of revolutionary technological innovations.4 Inventions and innovations need one or more champions to create them and intro- duce them to the marketplace. 5 Successful innovations require a combination of factors, including vision, persis- tence, technical and business skill, good intuitive sense, and good luck