On the Businessweek website, there is a blog post explaining the downward spiral of Hewlett-Packard. The blog begins by explaining that the company’s CEO, who happens to be the fourth in the past seven years, announced that shares recently dropped to a nine–year low and that the company’s 2013 profits are more than likely to miss the estimates previously made. The company has been in a state of decline for the past twelve. The company will make facility consolidations and large layoffs worldwide.
The author of the blog, Judith Hurwitz, predicts that Hewlett-Packard will have no choice but to become a holding company or break up into pieces and sell. Ideally the company would turn around by creating new innovative products since the company was built on the idea innovation when it first began and it succeeded quite well for a time in the market of technology. A turnaround through the creation of new products would help them attempt to keep up with such companies as Apple, although those chances appear slim to none at this point especially since the company is in the red to the amount of 30 billion dollars. With that amount of debt, options become limited. Any manufacturing company faces large costs involved with creating new products from design to production and testing, similar to our Deming cycle or PDSA. Hewlett-Packard would have to create products that can compete with or surpass those already on the market and then improve upon them as time passes. With Apple creating new products or improved models regularly and a loyal customer base, I do not think Hewlett-Packard stands much of a chance at a turnaround especially since they only specialize in hardware in the form of computers and printers.
Early on in the company’s life they proved to be a contender in the computer market, I myself have had several of their products over the years. However, as we have seen with many well-known and well-off companies, the ship is starting to sink. I believe many factors have gone into their current downfall such as a fast paced market that is constantly changing, changing consumer demands, and the success of Apple. This only makes me wonder if Apple will one day face the same fate. I am sure Hewlett-Packard, or any other company for that matter, never thought they would be in such a position. Had they branched out in the form of products such as phones or software, perhaps they would be better off today; or maybe such things will be what saves them. Perhaps they have attempted to make incremental improvements to both their products and business strategies over the years that have not proved to be greatly beneficial in the long run; maybe what they really need is a breakthrough.
Do you think Hewlett-Packard will be in business much longer? What are some ways they can stay in business?