Xero Holdings (NASDAQ: XRX) and Oracle Corp (NYSE: ORCL) have entered a multi-year agreement that will offer cloud-computing software and infrastructure to the business ventures made in Xerox Holdings’ business incubator.
Xerox is using this move to speed up the creation of new enterprises within the business, be it new joint ventures, start-ups, business units, and subsidiaries beyond the company’s flagship copiers and printers.
Impact of Covid-19
When the Covid-19 pandemic hit its peak in 2020, companies worldwide started to shift to remote work and cleared their office spaces. During this period, Xerox’s income dropped from $219 million in the quarter ended September 30, 2019, to $90 million in the same quarter of the current fiscal year.
With that said, the strategy of developing new in-house business ventures was something that predated the global Covid-19 pandemic. However, remote work movements and workplace closures helped accelerate this strategy, claimed Xerox Chief Technology Officer and Senior VP Naresh Shanker.
Mr. Shanker claimed that the company’s goal is to create businesses that provide a wide range of services ad products that focus on sustainable technology, the industrial Internet-of-Things, and 3-D printing. The CTO said:
The idea is to create an environment and agility to compete with all the start-upsstart-ups around the world in these different sectors.
Xerox intends on utilizing Oracle’s cloud-computing software and infrastructure as a digital foundation for all the new and innovative ventures in its business incubator. This includes its enterprise applications for e-comm platforms, financial planning and budgeting, accounting, finance, analytics, and so on.
Each new business venture in the incubator is expected to require its own information tech system, which will largely depend on its market and sector. Mr. Shanker crucially added that these information systems will need to be installed as quickly as possible and can easily adapt to certain shifting market demands. Mr. Shanker said:
It’s all about speed. That’s what got us here.
Xerox had already used Oracle’s cloud-computing services before when it was developing CareAR, a software business venture it launched in September.