Overview of the Strategy of Hewlett Packard Essay

Hewlett Packard which has $ 3.5 billion one-year R & A ; D provides engineering for concern and persons. This manner Hewlett Packard can pull more clients and function them and come in new markets. HP provides clients with intuitive, quality merchandises and services that are environmentally safe and to set about their operations in an environmentally scruples mode. HP strives to supply diverse array of low-cost computing machine engineerings, and go on their company slogan: ” It is necessary that people work together in unison toward common aims and avoid working at cross intents at all degrees if the ultimate in efficiency and accomplishment is to be obtained. ” -Dave Packard

Vision, Mission, and Aims
Customer trueness – To supply merchandises, services and solutions of the highest quality and present more value to HP clients that earns their regard and trueness. HP ‘s success is dependent on increasing the trueness of their clients. Listening closely to clients to to the full understand what it is they need, so presenting solutions that translate into client felicity. This is indispensable to gain client trueness. Competitive entire cost of ownership, quality, ingeniousness, and the manner HP does concern thrusts client trueness.

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Net income – HP ‘s end is to accomplish sufficient net income to finance Hewlett Packard company growing, make value for HP stockholders and supply the resources HP needs to accomplish their other corporate aims. Net income is the duty of all. Balance of long-run and short-run aims is cardinal to profitableness. Net income allows HP to reinvest in new and concern chances. Net income is extremely connected to bring forthing hard currency, which brings more flexibleness to the concern at a lower cost. Net income enables the accomplishment of HP ‘s corporate aims.

Market leading – To turn by continually supplying utile and important merchandises, services and solutions to markets that HP already serves and to spread out into new countries that build on HP engineerings, competences and client involvements.

Growth- To see alteration in the market as an chance to turn ; to utilize HP ‘s net incomes and ability to develop and bring forth advanced merchandises, services and solutions that satisfy emerging client demands.

Employee committedness – To assist HP employees portion in the company ‘s success that they make possible ; to supply people with employment chances based on public presentation ; to make with them a safe, exciting and inclusive work environment that values their diverseness and recognizes single parts ; and to assist them derive a sense of satisfaction and achievement from their work.

Leadership capableness -To develop leaders at every degree who are accountable for accomplishing concern consequences and representing HP ‘s values.

Global citizenship – Good citizenship is good concern. HP lives up to their duty to society by being an economic, rational and societal plus to each state and community that HP does concern in.

Background and Industry
Bill Hewlett and Dave Packard founded HP in 1939. They knew each other from being fellow Stanford University classmates. The company ‘s first merchandise, built in a Palo Alto garage, was an audio oscillator. Believe it or non, one of HP ‘s first clients was Walt Disney Studios. Disney purchased eight oscillators to develop and prove a new sound system for the film Fantasia. In World War II, the United States Government began holding an involvement in new technological merchandises. What was a little involvement grew into a immense necessity. The authorities ‘s demand for engineering helped HP to construct its first edifice and present new merchandise lines. HP is incorporated on August 18, 1947. Dave is named president, and Bill frailty president.

Hewlett-Packard starts to turn and maturate as a company in the fiftiess. At this clip the company starts offering stock options to employees, something that is really unusual for the clip. HP invents the high-velocity frequence counter in 1951. Radio Stationss everyplace use the new frequence counter. The frequence counters will account for one million millions of dollars in grosss. In 1957 HP becomes a publically traded company. The corporate aims are besides written at this clip, every bit good as the move/setup of the HP central office at 1501 Page Mill Road San Francisco. In 1958 HP acquires its first company, the F.L. Moseley Company. In 1959 HP becomes a planetary company. The company besides gets a pes in the European market.

The Company makes the Fortune magazine ‘s list of top 500 U.S. companies in 1962. In 1963 HP gets in the Asiatic market by organizing its first joint venture, Yokogawa Hewlett-Packard, in Tokyo, Japan, with Yokogawa Electric Works. In 1964 HP celebrates its twenty-fifth day of remembrance and Dave Packard is elected CEO while president of the board, Bill Hewlett, is elected president. In 1966 HP Laboratories is established as the company ‘s cardinal research installation. HP Labs research includes solid province natural philosophies, physical electronics, electronics, and medical and chemical electronics instruments. The first HP computing machine ( HP 2116A ) is introduced in 1966 as good. The HP 2116A is the largest individual mechanical bundle HP has built to day of the month, and it marks HP ‘s first usage of incorporate circuits. In 1968 HP develops the first desktop scientific reckoner, the HP 9100A. The ads for the 9100A call it a personal computing machine, which is one of the first documented utilizations of the term. In 1969 Dave Packard is appointed U.S. Deputy Secretary of Defense. Bill Hewlett becomes CEO after Dave Packard resigns to function his term in office.

In 1972 Dave Packard retires as Deputy Secretary of Defense, and is elected president of the board at HP. Bill Hewlett retains rubric of president and CEO. HP makes another discovery in 1972 with the universe ‘s first scientific handheld reckoner ( HP-35 ) . 1974 marked HP ‘s debut of the first minicomputer to be based on 4K dynamic random entree memory french friess alternatively of magnetic nucleuss. In 1977 Bill Hewlett retires as president but remains CEO. Dave Packard remains president of the board, and John Young is named president. Young was executive frailty president responsible for HP ‘s instrument, computing machine systems and constituents Groups at the clip. Under his term as president, HP will turn to take the computer science industry. Bill retires as CEO in 1978. John Young succeeds him as CEO.

HP evolves into a major subscriber to the computing machine industry in the 1980s. HP introduces its first personal computing machine ( HP-85 ) and the first optical maser pressman in 1980. In 1981 Hewlett Packard opens an office in Beijing, China in order to do their merchandises available at that place. 1983 was the twelvemonth that HP introduced the first HP touch screen personal computing machine ( HP-150 ) . The National Medal of Science is given to Bill Hewlett in this twelvemonth every bit good. HP ‘s first low-cost personal pressman was made available in 1984. The first high tech joint venture in China is created in 1985 by the formation of China Hewlett Packard. Bill Hewlett retires as frailty president of the HP board of managers in 1987, and is named manager emeritus. Besides in 1987, the original garage rented by Dave Packard at 367 Addison Ave. , is granted California province landmark position as California Registered Landmark No. 976. The company mass produces its first ink jet pressman in 1988 ( DeskJet pressman ) . The company besides gets its first out of state stock listing by doing to the Tokyo stock exchange.

The 1990 ‘s marked important progresss in the portable computing machine industry, every bit good as in the place computing machine market. For most of this decennary, HP had a growing rate of 20 % . Around 1991, John Young retired and is replaced by Lew Platt. HP additions acknowledgment as a company who really cares about an employyees home life every bit good as occupation public presentation. HP make paces in assisting the community every bit good. At the terminal of the 90 ‘s, HP splits its measuring and constituents concerns to organize a new company, Agilent Technologies. Lew Platt retires at the terminal of the 90 ‘s, coercing HP to convey on a new CEO and President, Carleton ( Carly ) Fiorina. Fiorina focuses the company on fixing itself for growing and leading in the following century. In the 90 ‘s the company focused its advertisement on the all the inovations HP has made over the past decennaries. The company besides introduces a new logo at this clip.

At the beginning of the twenty-first century, HP focuses on cut downing the cost of computing machine systems ( or IT: Information Technologies ) for concern and bettering the overall shopping experience consumers have with today ‘s altering engineering.

The most notible thing that happened for HP in the new century occurred on May 3, 2002, when HP completed its amalgamation dealing with Compaq Computer Corp. , the largest tech amalgamation in history. “ The new HP is a taking planetary supplier of merchandises, engineerings, solutions and services to consumers and concern. The company ‘s offerings span IT substructure, personal computer science and entree devices, planetary services, and imaging and printing.

Merchandises and/or Servicess
Hewlett Packard provides computing machine, and computing machine related engineerings for today ‘s fast spread outing concern universe. HP continues to break itself at functioning top of the line technological merchandises to their clients, and to do strives and inventions in new Fieldss of engineering every bit good. Below is a list of the current Hewlett Packard merchandises and services.

Desktops & A ; Workstations – Compaq Presario desktop Personal Computers, HP Pavilion desktop Personal computers, HP Media Center PCs, HP Pavilion Slimline PCs, and HP besides provides smaller more cost effectual PCs ( like the Thin clients or Blade Personal computers ) for concern or place office usage.

Notebooks & A ; Tablet PCs – HP Pavilion notebook PCs ( DV, ZD, ZE and ZV series ) , Compaq Presario notebook PCs ( Integrated radio characteristics. Includes R and V series notebooks. ) HP besides has the Tablet notebook. This laptop is the ultimate in portability and versatility by really accommodating to the manner you work.

Printing & A ; Multifunction- In add-on to supplying top of the line Personal computers and notebooks, HP has an impressive line of printing merchandises every bit good. The merchandises include: Color inkjet pressmans, colour optical maser jet pressmans, colour multifunction pressmans, exposure pressmans, black & A ; white optical maser jet pressmans, black & A ; white multifunction, nomadic pressmans, big format pressmans, digital printing imperativenesss, print waiters and web package, and even merchandises serving in writing humanistic disciplines solution and printing & A ; imaging solution demands.

Calculators – HP offers reckoners for any finance or concern demand. HP theoretical accounts include: 10bII, 12c, 12c Pt, 17bII+

Handhelds- HP offers hand-held iPAQ pocket Personal computers for home/personal and concern usage. The theoretical accounts are to legion to be listed here. Monetary values range from $ 200 to about $ 700.

Proctors & A ; Projectors- HP provides proctors for amusement or concern usage. The two chief theoretical accounts are the CRT theoretical account ( a box like telecasting box manner proctor ) , or the level liquid crystal show ( LCD ) proctor. Sizes and manners vary to preference. In add-on to proctors for Personal computers, HP provides projectors for digital place film usage and digital projectors more suited for concern.

Fax, Copiers & A ; Scanners- HP provides Home/Home office Fax machines runing from $ 129.99 to $ 169.99. Fax machines more suited for concern scope from $ 99.99 to $ 169.99. Duplicators for place usage or concern vary in monetary value from $ 299.99 to $ 399.99. Scanners for concern or place usage vary from $ 79.99 to $ 1499.99. HP besides offers big black and white multi map pressmans for office or corporation usage. Monetary values vary from $ 199.99 to $ 9,999.00 and up.

Digital Photography – HP offers many different types of digital cameras. Monetary values vary from $ 129.99 to $ 349.99. HP besides supplies quality exposure pressmans from $ 99.00 to $ 449.00.

Entertainment -HP has an impressive array of telecastings as good. Micro show telecastings, plasma telecastings, and LCD telecastings are available. HP besides provides amusement systems such as HP Digital Entertainment Centers for place usage, Entertainment notebook PCs ( listed supra ) , and iPAQ Pocket PCs ( listed supra ) . HP besides provides DVD authors, every bit good as amusement accoutrements for Personal computer notebooks and Desktop PCs.

Storage – HP provides 100s of storage merchandises and services. Merchandises vary from web and waiter storage, to internal/external and removable difficult thrusts. HP besides provides astonishing proficient support for each of these countries.

Waiters -HP has many types of waiters to accommodate their consumer ‘s demands. HP ProLiant waiters: ( DL, ML, BL blades ) . HP Integrity waiters: entry-class, mid scope, superdome/high-end, HP unity BL blades. HP Integrity Nonstop waiters: HP 9000 waiters, HP Alpha Server systems, Telco and carrier-grade waiters, HP e3000 waiters, and even provides information on their discontinued and retired systems

Supplies & A ; Accessories – HP provides accoutrements for all printing, digital camera, and imaging demands. Accessories vary from: ink and toner cartridges, paper, publishing stuffs, memory cards for digital cameras, and accoutrements for HP pressmans, facsimile, duplicators, scanners, digital cameras, and digital projectors. HP besides services besides supplies accoutrements and options for Personal computer calculating merchandises such as memory, proctors, networks/network accoutrements, and most package for all HP and Compaq PCs.

Networking – Horsepower offers excessively many networking options and services to be listed here. HP has networking package and support for any place or concern need. They can supply service for simple at place or little concern webs, or more big graduated table networking with Cu and/or fiber ocular possibilities.

Software Products -HP provides many types of package that include: direction package and solutions, server, storage, Personal computer and workstation package, printing and imagination package, several different types of operating systems ( such as Windows, Linux, ECT ) , downloads straight from the web site, and application development package.

HP provides merchandises and services that meet the turning demand for technological superior engineerings for both place and concern usage. HP continues to take the manner in the Personal computer and printing industry, every bit good as discovery to new industry altering engineerings.

Growth Strategy
HP is focused on three engineering displacements:

Next-generation informations centre

nomadic calculating

printing and imagination

HP ‘s history on its growing scheme is based on a mix between innovation and invention.

HP reiterated its prognosis for financial 2007 a gross of $ 97 billion. Prognosis on its gross will exceed $ 100 billion for the first clip in financial 2008, with growing driven by its computing machine hardware and printing concern and cost-cutting.The company has already cut more than 15,000 occupations this twelvemonth.

HP saw financial 2008 operating net income border of 4 per centum to 5 per centum in its personal systems group, and 14 per centum to 15 per centum in its imagination and printing section. The company expects gross to turn by 4 per centum to 6 per centum at both units.

HP has discussed in December the company ‘s $ 3.6 billion one-year R & A ; D engineering investing. Technology disbursement is aligned with the HP ‘s growing scheme and that it positively impacts HP ‘s underside line.

HP ‘s investing doctrine is to see partnering with companies with whom HP can develop a strategic and/or proficient relationship.

aˆ?Enterprise Waiters, Storage, Management Software, Networking, and Servicess

Personal Computer science Merchandises

Imaging and Printing ( including Entertainment and Digital Photography )

Types of investing relationships that typically will be considered are for:


Joint Venture

Joint Development

Minority Equity Investment


HP said it agreed to get Knightsbridge Solutions Holdings Corp. , a services company specialising in the information direction countries of concern intelligence and informations warehousing.Microsoft and HP program to pass $ 300 million over the following three old ages in an expanded attempt to jointly sell engineering to big concerns.

In December 20th, HP announced that it has signed a unequivocal understanding to buy Bitfone Corp. , a in private held planetary package and services company that develops package solutions for nomadic device direction for the radio industry.

The acquisition is portion of HP ‘s scheme to turn its nomadic endeavor concern. Mobile devices are progressively going portion of the nucleus IT substructure and there is a turning demand that they need to suit into bing direction systems and models. This acquisition provides HP the package tools to assist concern clients cut down device support costs and smooth device deployments, migration and replacing.

The Market
In relation to Hewlett Packard the market that they would be involved in would be the IT market. The IT market is spread outing more and more each twenty-four hours with new ascents going available to consumers. The whole universe is sing a whirlwind of technological alteration. Most people feel the alteration each clip they encounter a new consumer appliance, read about the possibility of human cloning, or observe kids every bit immature as six or seven socialising with their school friends via online instant messaging. There have been periods, such as the late 1800s, when new innovations appeared in society at a comparable rate. But the gait of alteration today, with its societal, economic, and other impacts, is as important and far making as at any other clip in history. Technology is the procedure by which worlds modify nature to run into their demands and wants.

Target market is the market section to which a peculiar merchandise is marketed. This can be done by gender, age, geographic location etc. In relation to Hewlett Packard they would hold a immense mark market. With about every family now having at least one personal computing machine it is clear to see that computing machines are rather popular in society today. Personal Computers can fulfill demands to a scope of people/institutions.

The Following would be the mark market:
Institutions such as schools and colleges are immense computing machine users, they are used for the cyberspace, undertakings, looking up information, typing etc and hence would be portion of the mark market.

Businesss are heavy users of computing machines, computing machines are really of import to concerns as they can utilize them for a figure of grounds such as for hive awaying of import files, doing bills, hard currency flow statements even holding meetings through the computing machines. They besides use them as a method of advertisement.

Peoples at place may utilize them for personal usage such as look intoing their electronic mails, booking vacations, kids making their prep. people over 60 old ages of age are besides really familiar with the usage of computing machines.

As clip goes on it is going more evident that people are going more and more involved with computing machines every twenty-four hours. Internet Cafes are being set up everyplace so there is computing machine entree available everyplace you go. Therefore I would give as a decision that it is just to state that it would be targeted to about everyone.

Hewlett Packard would hold 2 chief rivals, they would be Dell and Apple. Both of these are multimillion companies with immense production and gross revenues degrees. Dell is the universe ‘s largest mail-order computing machine marketer. It was founded by Michael Dell in 1984, Dell Computer has built a repute for presenting choice Personal computer ‘s at competitory monetary values. Dell is involved in constructing machines utilizing less expensive standardised parts alternatively of developing their ain far more expensive parts. Dell so uses these parts to drive their capableness and to make standardised machines to take them to be one of the taking rivals in the IT sector today.

For a long clip IBM were the lone company who made computing machines so other companies joined the force to make a healthy market for computing machines. Dell have a competitory advantage in so far as specialising in cost control and besides client experience dingle can offer you a bundle where you can fundamentally do your ain computing machine online it will demo you the entire cost. You can so order it online and so it will be delivered to you within a few hebdomads. This may appeal to a batch of consumers as it saves so the fuss of traveling to computing machine shops seeking for the right laptop to accommodate their demands. they can take precisely what they want/need in their laptop at their ain easiness on the cyberspace.

The 2nd rivals would be Apple. Apple Macintosh computing machines were foremost introduced in 1984. They are besides one of the taking forces in the computing machine industry today and are characterized by their designs and applications base, constitutional networking, artworks and multimedia capablenesss. The company offers a scope of personal computer science merchandises, including desktop computing machines, notebooks, related peripherals, package and networking and connectivity merchandises.

Where Apple truly stands out and where it has a competitory advantage is in its selling. The company merely seems to understand what will acquire people excited about its merchandises, and so it executes on that vision. the company does non concentrate chiefly on characteristics or engineering, but about how the computing machine will do your life better. Apple ‘s design of computing machines are really elegant. Apple has done small things like seting the power button on the iMac into the screen, where it is both easy to entree and provides an experience. if you look at the laptop flexible joints on the new PowerBooks and eBooks, you ‘ll see the manner screens should be attached to laptops. The screen opens out and down, minimising the tallness of the unfastened laptop and doing it much more practical for aeroplane usage.

Strengths: HP greatest strength is their place as the largest computing machine company in the universe. They have reached markets in 160 states. The HP direction manner has been regarded as one of the best in the universe. This direction construction has been with HP since its historical beginnings and has facilitated HP ‘s phenomenal growing. HP ‘s concern with employee wellbeing has created a corporate civilization that promotes productiveness, growing, and trueness from their employees. HP ‘s in-house research and development, called HP Labs is a valuable plus that has kept HP at the head of engineering. HP has been exceeding at take downing costs while keeping first-class quality. HP has a great strength in their name acknowledgment. HP has been able to keep the figure one place in the personal pressmans industry since they revolutionized the market in the early 80 ‘s.

Failings: There was some opposition by the Compaq Corporation ‘s employees when it merged with HP. Rather than altering the full civilization Compaq was expected to accommodate to the bing HP civilization. HP ‘s vision statement is really deficient. It does n’t offer any existent hereafter aims nor does it pass on all of the achievements of HP in its yesteryear. HP ‘s stock list turnover is below mean and puts HP at hazard of falling behind the competition. HP ‘s ability to place failings is hapless. It took a batch of seeking to happen failings in the company. Most companies will publically turn to their failings and show a program to counterbalance for them. This may be related to the manner of direction HP uses. Possibly its excessively focused on what needs to be done to carry through ends and non concerned plenty on what needs to be done otherwise now.

Opportunities: Hewlett-Packard has a enormous sum of chances in which to take advantage. First and foremost the amalgamation between Compaq and HP is the largest of its sort, doing the new HP the largest computing machine company in the universe. HP ‘s research and development installations and engineerings are province of the art. The company yearly invests $ 4 billion on R & A ; D of merchandises, solutions and engineerings entirely. HP Labs ‘ is a division or section in HP ‘s organisational construction in which all R & A ; D activities take topographic point. HP Labs ‘ map is to present breakthrough engineerings and to make concern chances that go beyond HP ‘s current schemes.

Hewlett-Packard has implemented a cost film editing scheme since the amalgamation and in making so the company forecasted a cost nest eggs of $ 3 billion. That twelvemonth the company had cost economy of $ 3.5 billion. HP ‘s CEO, Carly Fiorina, says that the company is expected to cut an extra $ 1 billion from its supply concatenation. HP ‘s concern is deriving strength because of cost nest eggs that exceeded outlooks and big trades, including the sale of a Superdome waiter to the Chinese authorities, and a $ 3 billion, 10-year outsourcing understanding with Procter & A ; Gamble. HP has besides had a long working relationship with the U.S. armed forces.

Menaces: HP ‘s figure one menace is its rivals. The engineering and computing machine industry is characterized by fast market growing and short merchandise life rhythms and is plagued with merchandises going obsolete over dark. Among the strongest rivals in the industry are Dell Computer, IBM, Apple Computer, and Gateway, and all of them are looking for failings in the new HP. These rivals are utilizing monetary value film editing, shortened merchandise life rhythms, and mass advertisement and publicities to cut into HP ‘s overpowering market portion. With this comes the menace of permutation and an intensifying competition among rivals.

Resistance from some top executives, director and employees is a major concern for HP. Some of which ne’er wanted to amalgamation between the two elephantine computing machine companies to of all time take topographic point. The amalgamation was opposed by the founding households of Hewlett-Packard, who argue that purchasing Compaq would thin the HP trade name and go forth it with a big personal computing machine division. This created contention within the company and led to some opposition from employees

Updated Fiscal Analysis
The fiscal mentality for Hp at the terminal of their 2001 financial twelvemonth looked bleak ; overall, grosss had fallen to $ 45,226,000. This was a lose in gross revenues of over 3 million dollars predominately focused around their Merchandise sector. At this clip, HP ‘s fiscal statements clearly illustrated a company that was combating a major economic recession every bit good as the ferocious competition from its major rivals.


Income Statement

Year ended October 31

In 1000000s, except per portion sums

2003 2002 2001 2000

Net gross:
Merchandises $ 58,939 $ 45,969 $ 38,059 $ 41,653

Servicess 13,657 10,165 6,765 6,848

Financing income 465 454 402 369

Entire net gross 73,061 56,588 45,226 48,870

Costss and disbursals:
Cost of merchandises 43,689 34,189 28,824 30,343

Cost of services 9,959 7,414 4,688 4,470

Financing involvement 209 189 236 233

Research and development 3,652 3,369 2,753 2,627

Selling, general and administrative 11,012 8,763 6,668 6,984

Amort. of purchased intangible assets 563 402 174 102

Restructuring charges 800 1,780 384 –

Acquisition-related charges 280 701 25 –

In-process research and development 1 793 35 86

Entire costs and disbursals 70,165 57,600 43,787 44,845

Net incomes ( loss ) from operations 2,896 ( 1,012 ) 1,439 4,025


Historical Results for Division

Dollars in 1000000s 2003 2002 2001

Imaging and Printing Group
Net Revenue $ 22,623 $ 20,406 $ 19,492

Net incomes $ 3,570 $ 3,346 $ 2,091

Personal Systems Group
Net Revenue $ 21,228 $ 14,706 $ 10,094

Net incomes $ 19 ( $ 241 ) ( $ 157 )

Enterprise Systems Group
Net Revenue $ 15,379 $ 11,146 $ 8,081

Net incomes $ ( 54 ) $ ( 656 ) $ 78

HP Servicess
Net Revenue $ 12,305 $ 9,010 $ 6,114

Net incomes $ 1,372 $ 891 $ 609

HP Financial Services
Net Revenue $ 1,921 $ 1,707 $ 1,453

Net incomes $ 79 $ ( 134 ) $ ( 169 )


Top Rivals

Fiscal Year 2003

HP Cannon Dell IBM

Cardinal Numbers

Net Gross ( in Millions of dollars ) $ 73,061.00 $ 29,888.50 $ 41,444.00 $ 89,131.00

Gross saless Growth ( one Year ) 29 % 22 % 17.10 % 9.80 %

Net Income ( In Millions of dollars ) $ 2,896.00 $ 2,576.90 $ 2,645.00 $ 7,583.00

Employees 142,000 102,567 46,000 255,157



Fiscal Year End 2003 2002 2001

Notes collectible and short-run adoptions $ 1,080 $ 1,793 $ 9,121

Long-run debt 6,494 6,035 3,128

Entire short- and long-run debt $ 7,574 $ 7,828 $ 12,249


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