Title ABC/123 Version X 1 Hewlett-Packard Case Study Analysis MGT/521 Version 15 5 University of Phoenix Material Hewlett-Packard Case Study Analysis Hewlett-Packard Is Counting on Organization Change to Boost Revenue Growth Meg Whitman became CEO of Hewlett-Packard Co. (HP) in 2011. Since the time HP’s revenue peaked in 2011 at $127 billion, it has dropped every subsequent year. On the positive side, the company had two consecutive quarters of growth in 2014. HP also is trying to right-size and reduce costs by planning to lay off 16,000 employees. HP earlier decided to lay off 34,000 people, resulting in a total reduction of 50,000 employees.100 Whitman described the job cuts “as an opportunity to streamline the company further and make it more nim- ble. An expected $1 billion in cost savings in fiscal 2016 would allow HP to invest in new technologies and skills to revive growth.” Others, like UBS analyst Steven Milunovich, believe that these job cuts will erode employee morale and may lead to increased turnover.101 “But fixing the world’s biggest tech company—with $120 billion in annual revenues and 330,000 employees— is a herculean task. Bloated by more than 70 acquisitions in the past 15 years, HP isn’t just sprawling and stalled out; it may actually be running in reverse.”102 Whitman decided to change the organizational structure to fuel growth. She created two clusters of businesses. One focuses on corporate technology customers. This group, which sells servers, storage, and networking, delivered 43% of the company’s overall operating profits according to Forbes. Unfortunately, the software and services that accompany all this hardware have not been as successful. HP tried to build the software side of the business via acquisitions, which according to Forbes have not been very successful. The magazine noted that “when it comes to software acquisitions, Autonomy [HP’s enterprise software company] was merely the most high-profit misstep. All told, over the past decade HP squandered nearly $19 billion to buy myriad outfits that contribute only 7% to overall profit. The services unit, which staffs other companies’ tech projects, is barely at breakeven.”103 HP is currently “looking for small to midsize acquisition candidates in cloud computing, security, and analytics software.”104 The second structural cluster sells printers, PCs, laptops, and mobile devices to people worldwide. This segment of the business contributed 29% of operating profits in 2013. The problem here is that the lucrative printer business is shrinking. Technology is simply moving more toward ink-free photo and document sharing, which benefits companies like Google, Face book, and Dropbox. Strategically, HP also is trying to get back into the fast-growing tablet market. The company attempted to gain entry in this market in 2011 with the TouchPad model, but it was a failure. Since February 2013, the company has introduced new models, and they are being well received in ...

1. Title
ABC/123 Version X
1
Hewlett-Packard Case Study Analysis
MGT/521 Version 15
5
University of Phoenix Material
Hewlett-Packard Case Study Analysis
Hewlett-Packard Is Counting on Organization Change to Boost
Revenue Growth
Meg Whitman became CEO of Hewlett-Packard Co. (HP) in
2011. Since the time HP’s revenue peaked in 2011 at $127
billion, it has dropped every subsequent year. On the positive
side, the company had two consecutive quarters of growth in
2014. HP also is trying to right-size and reduce costs by
planning to lay off 16,000 employees. HP earlier decided to lay
off 34,000 people, resulting in a total reduction of 50,000
employees.100
Whitman described the job cuts “as an opportunity to streamline
the company further and make it more nim- ble. An expected $1
billion in cost savings in fiscal 2016 would allow HP to invest
in new technologies and skills to revive growth.” Others, like
UBS analyst Steven Milunovich, believe that these job cuts will
erode employee morale and may lead to increased turnover.101
“But fixing the world’s biggest tech company—with $120
billion in annual revenues and 330,000 employees— is a
herculean task. Bloated by more than 70 acquisitions in the past
15 years, HP isn’t just sprawling and stalled out; it may actually
be running in reverse.”102

2. Whitman decided to change the organizational structure to fuel
growth. She created two clusters of businesses. One focuses on
corporate technology customers. This group, which sells
servers, storage, and networking, delivered 43% of the
company’s overall operating profits according to Forbes.
Unfortunately, the software and services that accompany all this
hardware have not been as successful. HP tried to build the
software side of the business via acquisitions, which according
to Forbes have not been very successful. The magazine noted
that “when it comes to software acquisitions, Autonomy [HP’s
enterprise software company] was merely the most high-profit
misstep. All told, over the past decade HP squandered nearly
$19 billion to buy myriad outfits that contribute only 7% to
overall profit. The services unit, which staffs other companies’
tech projects, is barely at breakeven.”103 HP is currently
“looking for small to midsize acquisition candidates in cloud
computing, security, and analytics software.”104
The second structural cluster sells printers, PCs, laptops, and
mobile devices to people worldwide. This segment of the
business contributed 29% of operating profits in 2013. The
problem here is that the lucrative printer business is shrinking.
Technology is simply moving more toward ink-free photo and
document sharing, which benefits companies like Google, Face
book, and Dropbox.
Strategically, HP also is trying to get back into the fast-growing
tablet market. The company attempted to gain entry in this
market in 2011 with the TouchPad model, but it was a failure.
Since February 2013, the company has introduced new models,
and they are being well received in the market. In a similar
vein, HP has created an overall vice president for design. This
was done to create a strategic focus on product development.
H-P didn’t stop at just a reorganization or a new tablet strategy,
according to Forbes. A survey of the company’s 20,000
salespeople revealed that employees rated the internal sales
tools a mere “7” on a scale of 1 to 100. For example, it took HP
as much as three weeks to prepare a sales quote, when

3. competitors could do it in a matter of days. The company
decided to upgrade its sales process by using new tools from
Salesforce.com.
Whitman also took to the road to reassure custom- ers that HP
was doing the “right things.” In the last year, she conducted
“305 one-on-one meetings with customers or sales-channel
partners, aides say, as well as another 42 roundtable chats with
small groups” around the world.
It did not take Whitman long to realize that the organizational
culture also needed to be changed to foster consistency between
the company’s strategies and culture. According to Forbes, she
eliminated the barbed wire fence and locked gates that separated
parking lots for the executives and the general employee
population. “We should enter the building the same way
everyone else does,” she said. She also decided to work from a
cubicle, like most employees, instead of from a larger, more
private location. She keeps a picture of her mother in her office.
She also role models when she travels by staying at more
modestly priced hotels.
While HP is positive about the changes taking place, some
analysts are more skeptical. Bill Shope, an analyst from
Goldman Sachs, concluded that “serial restructuring cannot
solve HP’s secular challenges, particularly following years of
underinvestment.” He forecasts that HP’s revenue might fall to
$107 billion in fiscal 2015.
Source: Hewlett-Packard is Counting on Organizational Change
to Bookst Revenue Growth. In Kinicki, A., Williams, B.K.
(Eds.), Management: A Practical Introduction (pp. 333). New
York, NY: McGraw-Hill.

4. Case Analysis Questions
Answer the following in up to 175- words each:
1. Describe supertrends that are driving HP to change.
2. Assess which forces for change are causing HP to undertake
major organizational change.

5. 3. Recommend how Meg Whitman could use Lewin’s and
Kotter’s models of change to increase the probability of
achieveing positive organizational change.
4. Determine how HP is following the four steps for fostering
innovation.

6. 5. What has happened with HP since this case was written?
Determine whether the implementation of these changes has
been successful. Explain what could have been done
differently.
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reserved.

7. Copyright © 2018 by McGraw-Hill. All rights reserved.
Chapter 9
Lessons from the Academy: ERM Implementation in the
University Setting
Introduction
Higher education environment
ERM in higher education
Adopting ERM in Colleges and Universities
The University of Washington case study
Summary
Higher Education Environment
Generally considered “different” from enterprises
Historically separate from targets of legislation
Often, success may lead to lack of risk management
Multiple high-visibility scandals have shed light on HE
Many HEIs have migrated to more corporate ERM
Different HE cultures demand different ERM solutions
ERM in Higher Education
Recognition of institutional areas
Each encounters unique risks
Risks can include

8. Litigation settlements
Loss
Assets
Enrollment
Donors
Reputation damage
Adopting ERM in Colleges and Universities
Think tank of HE to discuss ERM in HE
2001
Price waterhous Coopers
National Assoc of College and Univ Bus Officers (NAUCUBO)
Focus
Definition of risk
Risk drivers in HE
Implementation of risk management to assess, manage, monitor
risk
Proactively engage the campus community
University of Washington
Sentinel event
$35 million fine for Medicare and Medicaid overbilling
Push to implement ERM to improve compliance
UW is built on a decentralized governance model
Started with
Strategic Risk Initiative Review Committee (SRIRC)
Each initiative asked
Does this proposal add value?
What obstacles are apparent and how can they be addressed?
How can this proposal be improved?

9. University of Washington, cont’d.
Committee recommendation
Create a Culture-Specific ERM
Examined other HEIs
UW Evolution of ERM
UW ERM Structure
UW’s ERM Integrated Framework
UW’s ERM Process
UW’s Risk Assessment: Likelihood and Impact
Summary
Outcomes are consistent with guidance offered by
National Association of College and University Attorneys
(NACUA)
NACUA eight critical factors
Establish the right vision and realistic plan
Obtain senior leadership buy0in and direction
Align with mission and strategic direction

10. Attack silos at the outset
Set objectives and performance indicators
Stay focused on results
Communicate vision and key outcomes
Develop a sustainable process versus a one-time project
Chapter 6
Strategic Risk Management at the LEGO Group
LEGO Strategy
LEGO mission
“Inspire and develop the builders of tomorrow”
LEGO vision
“Inventing the future of play”
Growth strategy
Innovation strategy
LEGO Group History
Headquarters in Billund, Denmark
Second largest toy manufacturer (globally)
Founded in 1932
Iconic bricks first introduced
Bricks manufactured since 1958 fit with one another
2400 different brick shapes
Manufactured in plants across four countries

11. LEGO Strategy
LEGO mission
“Inspire and develop the builders of tomorrow”
LEGO vision
“Inventing the future of play”
Growth strategy
Innovation strategy
ERM at LEGO
Risk management developed in 4 stages
Step 1: Enterprise risk management
Step 2: Monte Carlo simulations
Step 3: Active Risk & Opportunity Planning (AROP)
Step 4: Preparing for Uncertainty
Order is by initiation sequence
Steps 1 & 2 are damage control
Steps 3 & 4 are proactive
ERM Step 1: Enterprise Risk Mgmt
ERM Step 2: Monte Carlo Simulations
Monte Carlo simulation
Method of evaluating the effect of input variances on a model of
a complex system
In short, it helps to see how input variances affect outcomes

12. Helps to define risk tolerance
Implemented in three areas
Budget simulation
Credit risk portfolio
Consolidation of risk exposure
ERM Step 3: AROP
Active Risk Assessment of Business Projects (AROP)
Formal approach to defining and handling project risk
Includes multiple steps
Identification
Assessment
Handling
Reassessment
Follow-up
Reporting
ERM Step 4: Preparing for Uncertainty
Preparing for Uncertainty
Defining and Testing Strategies
Workshops precede strategic planning sessions
Four scenarios
Agree on two key drivers of uncertainty
Describe each of four quadrants of 2x2 matrix
Define strategic issues
Actions to take
“who is doing what by when?”
The PAPA Model
Park, Adapt, Prepare, Act: PAPA
Park
Adapt

13. Prepare
Act
Risk Management ROI
Strong support from upper management
Efforts have resulted in value
Many LEGO key planning processes now include risk
management
More visibility of enterprise risk
More opportunity to address risk
Summary
Risk management is not risk aversion
ERM allows LEGO to take risks when appropriate
Grow
Create value
LEGO strategic risk management mission
“Drive conscious choices”