The news that HP is splitting into two different companies has not come as a surprise to me, since I can think of the main possible cause for the split, which would be HP’s aspirations of gaining economies of scale like cheaper supplies and lower transportation costs by becoming as big as possible, which they did not succeed in doing. Moreover,also their aspiration to diversify as much as possible, which they also failed to do, as they could not keep up with competitors who could adapt to changing consumer tastes faster and more efficiently than they could.
However, in my opinion the splitting of Hewlett-Packard is a good idea as it will reduce the mismanagement issues in the company and it will also help the companies to focus on the specific technology service it is providing, thus this decision will aid the company to increase its profits.
In addition, both the companies can be sold off if none of them succeed even after the split. Since, HP is a group of “commodity businesses” and it is not growing very fast and is not very sustainable.
Citation
http://www.cbc.ca/news/business/hp-splits-in-2-keeps-computer-printer-businesses-together-1.2788684
