H-P Blunders

In 2010, Hewlett-Packards CEO boasted that it was the largest IT company in the world and still haven’t even hit their full potential. Since then H-P has gone through two different CEO’s and the company’s market capitalization has fallen significantly. But what caused such a drastic fall off?

With all the leadership change at H-P, it has caused a lot of money loss because they cannot decided who should run the company, who’s plan to follow. There have been 4 different CEO’s since 2005 and that causes a lot of confusion within the work place because each CEO brings in a whole new feel. Also, each CEO has made cuts and lay offs, almost 75,000 workers since 2005. This has developed a lot employee moral around the company. Its hard to take pride and honor in your company when you are at the constant threat of being fired.

H-P also has a major debt to pay off. The company has spend more that 67 billion in acquisitions since 2001. H-P is over 5 billion in debt so they have had to make a lot of cut backs, like the employee firings, but also in different areas budgets. For example, Research and Development lost a good deal of funding. This was a poor business decision by H-P because they are a technology firm and with technology everyone wants the newest, most updated model and thats comes by research and development.

With these major blunders, what does H-P need to do to stay alive and turn the company around. What will new CEO, Ms. Whitman need to do as leader to turn the company around?





7 thoughts on “H-P Blunders

  1. The Wall Street Journal did an article on this a few years back so that is interesting you found this information on H-P. The WSJ reported that almost EVERY time a company’s management announces high growth or earnings in the quarters to come, they immediately get downgraded by the market and loose revenue. What Ms. Whitman needs to do is acknowledge the fact that H-P is struggling and work on paying off their debts rather than continuing to acquire in a down market.

  2. This is a very difficult time for Ms. Whitman, but I believe the possibility of placing funds back into Research and Development is absolutely essential for the success of H-P. Like they stated in the past, they are the largest IT company and if they would like to continue and actually live up to the reputation it is necessary for them to invest into research. They are in the technology sector and as we all know, technology is changing everyday. H-P needs to keep up with the innovation, but also find the balance of removing debt from their name.

  3. I think Ms. Whitman should consider selling the company to Apple or Microsoft. The only way they are going to make money, and pay their debt off is by selling the company. I feel that hp’s technology is behind the market, and I’ve always felt this way. When shopping for laptops and computers, HP is never an option for me or the people around me. I feel like HP was always cheap and that the laptops were made by cutting corners and not made to last. There is no way to get ahead of the market by cutting R&D, bad decision. Like you said, technology is changing everyday, so they need to either stay up on the innovations, or get out of the market. They do make a decent printer though, I have had mine for 5 years now and it works as well as it did since day one. It will be a challenge to shrink the company down, and still be able to hold a strong name.

  4. This article makes you wonder what HP was thinking, it was not a smart move to cut research and development being a tech company and I wounder if they thought that they would get by on the quality of the products that they put out as one poster stated they make a long lasting printer. This post makes me think about supply chain manufacturers and maybe HP can dedicate some of it facilities towards making components for other firms.

  5. I agree that the frequent management changes and the decrease in Research and Development funding have contributed to HP’s recent market slump. However, it is important to note that the personal computer industry as a whole has been on the decline in recent years. According to a report from the International Data Corporation, there has been a 14% decline in the sale of desktops and laptops this quarter. Part of the reason for this decline is because of the growing popularity of smartphones and tablets, which are much cheaper alternatives. If HP wants to remain competitive in the current marketplace, I would recommend that Ms. Whitman invests in Research and Development of smartphones and tablets.

  6. I agree that frequent change of CEOs does affect the atmosphere of any work place doesn’t matter if its a big company like HP or any small up and coming company. This would also result in lot of different clash of ideas since everyone would bring in their own vision of how they would see the company progress. It would be really interesting to see how much Ms. Whitman has managed to invest in the research and development as it is a backbone for any technological company and wants to stay in the market.

  7. This post makes me start to think about the kinds of internal and operational issues HP is having if the higher management positions have such a high turnover rate. Are there internal issues that cause the CEOs to leave? As someone else previously commented, I think the best solution would be for the CEO and CFO to work together to think about possible selling the company. If the management issues cannot be solved by HP, or even the new CEOs that come to the table, then the only solution is to find external contributors.

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