Organizational culture at hp
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  • 1. Organizational Culture at HP GROUP – 2 SECTION C
  • 2. HP – An Overview  Established in 1938 in a garage by William Hewlett and David Packard  Incorporated in 1947  World’s second largest computer supplier by 1997 ($42 billion)  Personal computers  Enterprise servers  Storage devices  Printers
  • 3. HP Way  Values and Principles to guide HP (1956)  Recognize that profit is the best measure of a company’s contribution to society and the ultimate source of corporate strength;  Continually improve the value of the products and services offered to customers;  Seek new opportunities for growth but focus efforts on fields in which the company can make a contribution;  Provide employment opportunities that include the chance to share in the company’s success;  Maintain an organizational environment that fosters individual motivation, initiative and creativity;  Demonstrate good citizenship by making contributions to the community;  Emphasize growth as a requirement for survival.
  • 4. Leadership Change Highlights  (1964)  Dave Packard was elected CEO and chairman of the board  Bill Hewlett assumed the position of president  (1999)  Carleton S. Fiorina replaced President and CEO  First outsider to take charge of the 62-year-old company.
  • 5. Changes led by Fiorina  Revitalizing the company and kick-starting growth  Overhauling the company’s structure, consolidating operating units, and shearing away layers of bureaucracy.  A new marketing campaign featuring a simplified “hp” logo that dropped the founders’ names  Meeting growth targets proved difficult  HP forced to cut jobs, employees asked to take unpaid leave  Plans to acquire Compaq
  • 6. Impact of Compaq/HP merger  Top management views merger as a way to differentiate the new company and avoid price wars  Investors and Employees skeptical of the deal  Merger likely to create a behemoth to hinder rapid growth  Difficulty of blending two organizations’ resources and culture  A full-service technology firm from selling PCs to setting up complex networks  Resistance to change of HP way
  • 7. Way forward  Four major operating groups:  services,  imaging and printing,  access devices,  information technology infrastructure  a full-service technology firm capable of integrating hardware and software into solutions  Employee reductions likely  Fiorina would be chairman and CEO of the new HP with Michael Capellas as President
  • 8. Changes made:  Front Back Organizational Structure:  80 autonomous product focused divisions into • 2 front-end Sales & Mktg. division • 2 back-end R&D and Manufacturing division Objective: • Achieving the SOLUTIONS perspective (rather than product focus) • Easier for the customer to buy Computers, Software and printers integrated into Seamless solutions to problems
  • 9. Pros & Cons- Divisional Structure at HP  PROS:  Entrepreneurial culture  New Product Development a strength  Profit & Loss accountability  CONS:  Strategic Decision making difficult  Poor integration among HP product offerings Ex. Incompatibility of HP inkjet & laser software  Customer dissatisfaction
  • 10. Earlier Culture defining parameters  Consistent Investment – Self finance own growth  Technical Innovation  High commitment culture  Pragmatic & Cautious approach Change for the worse ?  Management Credibility  Respect  Fairness  Best places to work in