Once regarded as a key player in the technology industry along the likes of Apple and IBM, Hewlett-Packard Co. commonly known as HP, has seen their market capitalization fall to” less than $30 billion from more than $100 billion two years ago“. Internal strategic problems continue to hinder the growth of the company as their market share have been largely overtaken by competitors. Analysts have highlighted three major flaws that need to be addressed by HP in order to regain their presence in the field. With four different CEO’s in five years, the lack of stability at the top creates an ambiguous direction for the company. Major lay-offs in order to invest more capital in research in development is “vicious in cycle” as a solution to fix HP’s declining product lines.
HP needs to look for a sustainable competitive advantage if it intends to remain a staple player in the hyper competitive market. This should include short term tactics coupled by long term strategy as well. For example, the constant rotation of senior executives creates a lack of unison within the entire firm. Investing in a solid selection process for executives will help employees in the all positions of the hierarchy be confident in the vision and leadership in the company leading to more productiveness and job satisfaction. Another long strategy would be to focus on quality rather than quantity. Currently, HP is producing more than 1,200 different type of laser printers along with their multitude of personal computers. Focusing on the few styles, but investing more time in the performance of each product will be attractable and manageable for consumers.
Works Cited:
Digital image. N.p., n.d. Web. 18 Oct. 2012. <http://www.zdnet.com/blog/btl/hps-mixed-bag-sales-weak-across-all-units-earnings-on-target-outlook-weaker-than-expected/13122>.