Hewlett-Packard (HP) is one of the most performing organization in the world in the area of technology. It offers wide-ranging IT products like laptops, monitors, software’s, personal computers, and smartphones. The levels of performance this organization has attained are attributable to the nature of the organizational structure, strategies of product expansion, market strategies, general corporate strategic planning and corporate culture. This paper evaluates a number of performance measure strategies utilized in this organization. Using peer-reviewed articles, the paper explains how the organization has managed to stay ahead in the market competition and how it has utilized various measures of organizational performance to deepen its technological roots around the world.
Keywords: strategic management, corporate culture, globalization, knowledge management, supply chain, organizational structure, market orientation, customer orientation, entrepreneurial orientation, horizontal integration, vertical integration, concentric diversification, and conglomerate diversification.
The measure of organizational growth comes in various forms. The most popular is the profitability of an organization. However, organizational profitability or performance is determined by how an organization has aligned itself to various attributes of organizational management. These include; strategic planning, globalization and international trade, corporate culture, market expansion strategies, acquisitions, diversifications, and product expansion measures. Any form of an organizational structure must be aligned with the corporate strategy. This paper reviews journals that evaluate these measures of organizational performance and profitability and how they are applicable to the Hewlett-Packard (HP).
Question 1: Strategic Management
Knowledge in the organization is one of the sources for an organization for its competitive advantage. It is defined as the efficient handling and management of resources and information in an organization. Knowledge management is one of the strategic issues and a tool for managing the organization. Omotayo (2015) demonstrates in his journal about knowledge management that, it is one of the drivers of an organization. It is a determinant of the nature of organizational performance the company realizes. The author notes that the human expertise in the organization is the reservoir of information and a huge investment to the performance of the organization in the competitive market. In the journal, Omotayo (2015) writes that knowledge management has been the foundations in which industrialized economies and large companies have relied on to change natural resources from their raw form to become valuable intellectual assets.
Knowledge management of strategic management in an organization. One of the components of strategic management techniques is in the creation of social value for the organizational customers. Omotayo (2015) argument about knowledge management specifies that organizations have to have the abilities to retain, organize, develop, and utilize the capabilities of their employees. At Hewlett-Packard (HP), the best forms of knowledge management are practiced. The company has managed over time to streamline sales, supply chain, services, and production by use of effective knowledge management techniques and information. At HP, the concept of information management comprises of the Supply Chain Management (SCM), Enterprise Resource Planning (ERP), inventory control systems, and production management. The main focus of knowledge management as a component of strategic management is to attain the desired competitive advantages in the market.
Planning is a foundation of organizational performance (Bagheri, 2016 May). Planning for an organization combines all the practices, efforts and activities that are related to the achievement of the organizational objectives. Bagheri (2016, May) notes that the strategic tools in an organization, especially in the private sector lays the foundation for the processes that are to be followed for the fulfillment of the strategic goals. One of the strategic tools in an organizational for the achievement of goals is the human resource. The management of personnel in the organization is an integral component of strategic management. Critically, human resource and organizational planning are strategic for any organization, and their values are added by use of the social, technological and economic processes (Bagheri, 2016 May).
Two of the most important strategic management frameworks for an organization is the vale evaluation and the stakeholders’ analyses. Bagheri (2016, May) writes that the two frameworks help in the management of stakeholders in the organization and achievement of value from the organizational processes. Value evaluation is achieved through integration and collaboration of various value networks and activities. They include; balanced scorecard, economic value analysis, main performance indicators, strategic value analysis, and triple-bottom-line reports. For stakeholder mapping, an organization must recognize and understand the demands and needs of the organizational stakeholders. Stakeholders are the groups of individuals who can influence an organization. They assist or to some extent hinder the creation of the value in the organization. The stakeholders at Hewlett-Packard (HP) include volunteers and the employees. The company recognizes and values the initiatives from volunteers and the employees for the sake of creating a social impact. The Hewlett-Packard Enterprise (HPE) recognizes the potentialities in the volunteers and has created a MicroMentor’s online platform for the purpose of making the global workforce to impact the achievement of organizational goals.
The Excellence Management Systems (EMS) is an important strategic management tool for organizations that enhance organizational results. The EMS is influenced by the larger strategic planning processes in an organization. As written by Suarez, Calvo-Mora & Roldan (2016, January), one of the ways of achieving organizational excellence is by enhancing commitment in the leaders. Using the Partial Least Squares technique and a sample of 225 candidates and firms for excellence awards in Spain, Suarez, Calvo-Mora & Roldan (2016, January) realized in their research that the commitments and the actions of leaders as well as people in the organization matter a lot in the overall achievement of the organizational goals.
The enhancement of EMS in an organization is also determined by integration of various quality objectives, values and the overall strategic planning process (Suarez, Calvo-Mora & Roldan; 2016 January). Related to the EMS is the EFQM excellence model. EFQM stands for the European Foundation for Quality Management and is anchored on the achievement of the competitive advantage for an organization in the competitive market. The EFQM technical and social factors are related to the achievement of the organizational results (Suarez, Calvo-Mora & Roldan; 2016 January).
Strategic management in an organization smothers innovation. In the contemporary organizational management, leaders are demanded to implement strategies that will help them achieve the needed organizational competitive niches. The leadership for an organization must come up with service and product ideas that are innovative and captive of the minds of the consumers. According to Herrera (2015, July), innovation in an organization helps influence competitiveness. Failure to innovate in an organization results in decreased competitiveness. Social innovation as one of the innovative ideas in an organization is a relevant corporate and global strategy. This is because the general society has expectations that global companies are socially responsible.
The ability to respond and sense threats and opportunities can enhance a competitive advantage for the company. Amongst the opportunities that an organization can exploit is the utilization of the corporate social innovation (CSI). According to Herrera (2015, July), CSI improves the organizations’ ability to achieve competitive advantage by resolving social concerns and improves the value of the shareholders. Important in the utilization CSI is the provision of business sustainability. However, it is not always that an organization achieves a lot in the competitive advantage by use of innovation. Ferreira, Fernandes, Alves ; Raposo (2015, July) write that despite the importance attached to innovation in competitiveness and organizational strategy, it can fail to relate well issues of innovation management, namely; the determinants of the innovation process and the implications to the firm.
David Packard, a co-founder of Hewlett Packard in 2014 and 2015 was awarded Excellence in Acquisition Award and Innovation Award by the Defense Acquisition University. As an electrical engineer in the company, David Packard’s award relates to the nature of strategic planning initiated at Hewlett Packard. The award is an indication that HP values innovation and excellence management as core drivers of organizational performance.
Question 2: Challenges in International Expansion
There are benefits accrued when a company aligns its operations and management feature globalization. When a business expands internationally, it gains new markets, has a larger access of talent pool, has the ability to diversify the assets, acquires opportunities in foreign opportunities, and gains a larger competitive advantage over the localized businesses in the same line of business. However, the moment a business expands internationally, it is also prone to a number of challenges. Three of the challenging issues in business expansion internationally are; risks in the supply chain, local competition in the expanded regions, and compliance with the regulatory business laws.
Risks in Supply Chain
Contemporary corporate management demand that an organization establishes itself in the international arena. This is achieved through globalization. The concept of globalization is the process by which companies gain international influence or start trading in the international arena. One of the challenges that have come with globalization is the concept of a supply chain. As written by Milovanovic & Radisavljevic (2017, January), for effective globalization and international expansion, companies must establish close relationships with crucial suppliers in the areas that they are establishing their links. The establishment of this relationship is hampered by the challenges associated with the supply chain as applicable to the globalization. When shipping commodities from far distant areas; for example, importing while in America from the APAC regions, the company has to contend with the distance.
Moving goods from one international region to a far region also complicates value addition. This is in addition to the costs accrued as the product passes different regions. According to Gereffi & Luo (2015, August), the risks associated with global supply chain include a possibility of loss of the goods imported. Much as there is a possibility of a gain, there is also a possibility of a risk. Gereffi & Luo (2015, August) note that supply chain has helped industries such as the automobile industry, but has also resulted to worldwide shocks. Whenever there are man-made or natural disasters in the automobile industry, the investigation is focused not only on the industry where the car was made but also on the supply chain network.
The strategy to overcome the challenges associated with the supply chain in international trade is to have a strategy before expansion, a workable business plan and a tangible budget. The management must conduct due diligence before deciding to expand the business to the international arena. The supply chain network must be well thought-out to avoid possible losses, incurring unnecessary costs and decrease in the value of the goods and services. A company must also conduct market research, seek supply chain advisory, and conduct operating environmental research to determine the best form of product flow to the country intended.
Competition from Local Companies
The second challenge in international expansion is the competition with the local businesses in the same line of business. Exporting a business model associated with the company to a foreign country may not apply in the same way as in the country of origin. For example, a business model in the United Kingdom may not apply in America or in Australia. The local companies in the foreign country have a better advantage over the incoming businesses. Writing about university transnational expansion, Micheli & Carrillo (2016) writes that in international trade, the local companies do not need to pay up import fees and other accrued costs in operating in a foreign country. As a result, the company may find itself at a disadvantage competing with the local businesses. The management in a foreign country must ponder on how best to compete with the already existing local businesses, especially in gaining more advantage than they have.
Global companies are facing challenges on the best marketing strategies to use. According to Luigi & Simona (2016), the aim of most of the global corporations is on how to homogenize, standardize and maximize the global marketing strategies. However, they fail to capture the essence of rivaling the local business. The existing local business with the same magnitude as the foreign ones is at good advantages to sustain market competitiveness. The foreign companies are disadvantaged since they have to cope with a number of challenges; for example, a different tax policy for foreign businesses. The local businesses also understand well the dynamics of the local consumers and therefore can strategize better on how to win them in marketing.
There are effective strategies that can help conquer the problem of local competition in international expansion. Micheli & Carrillo (2016) write that Huawei, a Chinese telecommunication firm, established its existence in Mexico and for the more than 14 years of its existence in the foreign nation, it has managed to shed off local competition. Huawei succeeded because of orienting all its operations with the local market instead of importing operations from China. The Hewlett-Packard international strategy is to use the product differentiation strategy.
Tax and Legal Compliance
Companies operating in foreign countries have to comply with the local regulations. One of the controversial issues in multinational companies is on the different taxing policies. According to Waroux et al (2017), the Organization for Economic Co-operation and Development (OECD) has concerned itself with the problems of different taxation policies and legal requirement for multinational companies. This has given the local business a higher leverage in the competitive market. In some cases, the local business and the government regulatory agencies in various countries contest that there has to be a way to make the local companies compete well against the multinationals. The tax codes in different countries and the compliance requirements have presented the companies wishing to establish themselves in foreign companies with challenges of coping up and sustainability.
Dealing with taxes in a foreign company is a challenge to the multinationals. Waroux et al (2017) write some legal and tax issues are indirect but give the foreign companies challenges of coping; for example, in South American countries, the countries have instituted legal implications of deforestation. As a result, a foreign soy company in any of the countries in South America, and especially Brazil, will face challenges of getting raw materials. Importing from the mother country and other sources of raw materials will increase the cost, and therefore unable to compete effectively.
There are other taxes and legal related challenges that force foreign companies to change tactics in operations in foreign countries. For example, many countries have instituted greater disclosure and control issues for foreign insurance companies. These legal measures make it difficult to manage in a foreign country, to some extent forcing companies to close and operate in areas where the tax and legal compliance is relaxed.
The solution to overcoming legal and tax handles in operating an international business in a foreign company is in restructuring. In the case of Soy and Beef business in South America, restructuring would help overcome the changed environmental regulations. The restructuring would involve diffusing the business model to fit the local demands, which would in term improve the revenue structure and effective cost management.
Question 3: Corporate Culture
Corporate culture is defined as the beliefs as well as the behaviors that characterize and determine the interaction between the management and the employees (Elsbach & Stigliani, 2018 January). Corporate culture also helps in handling business transactions. Corporate culture develops organically over time in an organization and not expressly defined. The concept of corporate culture and its practice has a significant impact on the achievement of organizational objectives. The orientations of corporate culture such as the customer, entrepreneurship, and marketing have a significant influence on the performance of an organization (Elsbach & Stigliani, 2018 January).
The entrepreneurial orientation of corporate culture refers to the way corporate culture affects the risk-taking, pro-activeness and innovativeness of a business (Cherchem, 2017 June). The manner of beliefs and behaviors in an organization and the relationship between the management and the employees impact positively or negatively the entrepreneurial outcome of a business. According to Cherchem (2017, June), in a family business, the corporate culture is the intergenerational manner of ownership and operation. This can influence the manner in which the business performs in the competitive market, and especially in the manner of innovativeness and risk-taking nature of the business. The nexus between the corporate culture and entrepreneurial orientation is that the family as a cultural outlook influences how the next generation will conduct business in the organization.
There are two major approaches to family business. First is the succession process in the family (Cherchem, 2017 June). In this process, it is known who is likely to take over the business management, and therefore, maintenance of a particular organizational culture. The culture is family-based. The next generation maintains the business model, and therefore, all factors being constant, the outcome of the business in the competitive market is static. The family is the fuel that drives the business. The second approach in a family business is the view that the family sets the goals to be implemented in the business (Cherchem, 2017 June). In the two approaches, it is clear that the business model is family oriented, and therefore, the entrepreneurial orientation is that of a family. For example, little or high aggressiveness depending on the nature of the family, and low or high pro-activeness in conquering the markets.
The behaviors that define entrepreneurial orientation are; competitive aggressiveness, autonomy, pro-activeness, innovativeness and risk-taking (Cherchem, 2017 June). The Hewlett Packard way of doing business is an example of corporate culture oriented to entrepreneurship. For a start, in this company, the founders; Bill Hewlett and David Packard have had a strong belief in involving people of different cultures in the organization. They created an environment that gives people in the organization a chance to express themselves. This also includes attributing organizational performances to the employees. The corporate culture at HP has guided its entrepreneurship focus since inception. One of the recognized pros of the operation of HP is the entrepreneurial culture it has entrenched for all the personnel in the organization. This includes; high commitment, consistency in investment, self-financed, technical innovation and pragmatic as well as cautious approach.
The marketing orientation in organizational culture is the culture that covers the business and provision of customer value (Pecic & Klarin, 2015). The effect of market orientation on an organization is profitability. The main focus of marketing orientation is the customer by increasing value of the products and services while winning him or her to buy the goods and services over other available alternatives. The aspect of market orientation as defined by Pecic & Klarin (2015) is the business aspect that targets and the employees to have the highest priority towards creation and maintenance of customer value. The biggest focus is profitability. The more the market orientation through customer value, the more the profitability.
Marketing orientation encompasses all aspects that give a focus on adding value to the customer through marketing. Green marketing as part of the marketing orientation has been used by the Toyota automobile industry to succeed in the competitive market. According to Simao & Lisboa (2017), for Toyota, marketing is one of the strategic measures for success. Green marketing in this company gives a strong focus on marketing and developing products and services with a view to satisfying the customers’ needs. It also takes into account the environmental sustainability. Developing cleaner products increases the value to both the existing and current customer for the company by minding their environment. The link between firm management and sustainability based on green marketing is strong.
Hewlett Packard recognizes that it operates in a very competitive industry, and therefore has to institute strong marketing orientation strategies that give it a significant competitive niche. The HP’s corporate website of June 2014 notes that the company values marketing of applications and products as a fundamental issue for its strategic plans. Writing on the website, Mike Spanbauer, the principal analyst for networking and data center technology noted that the company gives focus on low-cost solutions for the various technological needs of the customers.
The customer orientation as a component of corporate culture refers to a focus in the organization aimed at satisfying and retaining their customers. Maurya, Mishra, Anand, & Kumar (2015, September) write that the concept of customer culture is an element that gives a corporate identity to a company and achievement of organizational results. The authors add that one of the most important factors in an organizational performance is the company’s knowledge of the characteristics of its customers as well as their needs. When the company knows what the customers expect from the company, the company customizes the products and services to satisfy their needs. Important in these factors is carrying out a situational research that determines the gaps in the competitive market for proper orientation.
Listening and clarity are important strategies for enhancing customer orientation in an organization. A corporate culture modeled with customer orientation is a direction to achieving the organizational objectives. The measure of an organizational performance is the manner it treats the employees and profitability. Profitability is an outcome of customer orientation. Maurya, Mishra, Anand, ; Kumar (2015, September) write that most of the organizational failures are attributed to failure to attain the intended levels of profitability, which is linked to failure to focus on the needs of the customers. In the contemporary competitive market, an organization cannot ignore customer orientation model. To achieve customer orientation, the organization ought to align itself by using customer feedback for its value and involving the employees in value development.
One of the strong reasons why Hewlett Packard stays ahead in the technological competitive market is on its strong focus on the customer experiences. With enhanced application portfolio, the company achieves end-to-end experiences from the customers. The company has also developed mobile apps that help it bridge the enterprise experience with the customer experiences. Among others, the company uses online surveys, emails, and websites to understand the customer needs while at the same time growing the customer relations.
Question 4: Corporate-Level Growth Strategies
Strategic management is the implementation and formulation of initiatives and goals in an organization. Strategic management is based on an assessment of the organization’s market environment. It is also anchored on the resources it accumulates for its performance. For the achievement of the organization’s objectives, there are four corporate-level strategies that are considered. They are; vertical, horizontal, concentric and conglomerate growth strategies. This discussion looks at the four growth strategies and their applicability to an organization.
The vertical integration growth strategy is the combination of more than two stages of organizational production and operated by a separate firm. In this form of growth strategy, the company acquires a business operation and occurs when an organization takes over control of a number of distribution steps and production. The production stages and distributions steps are used for the creation of products and services in a vertical market. According to Vardarlier et al (2015), vertical integration can be done in two major ways, namely; forward integration and backward integration. Backward integration is when a company expands backward in regard to the path of production into manufacturing. The forward integration model is when a company assumes forward expansion into distribution.
There are impacts associated with the vertical integration form of growth strategy in an organization. Vardarlier et al (2015) write that vertical integration is critical to the survival of an organization and its operations. The impact is when the company brings some of the outsourced operations to internal management. The organization can assume full vertical integration by getting all the resources, the assets, and the human resources into the supply chain (Stukalina, 2016 November). A Company like Apple has practiced vertical integration. The company has many production outlets and products; for example, iPads, iPhones, and iPods. The company in the year 2015 opened up an industry in Taiwan to develop OLED and LCD technologies. This is in addition to its opening up of a manufacturing facility in San Jose. These kinds of investments have allowed the company to move the supply chain in a vertical integration form, and specifically, backward integration. The results have been freedom and flexibilities in its capabilities to manufacture quality products.
Hewlett Packard has also practiced vertical integration. In the year 2001, the company acquired Compaq. The company also manufactures its own integrated circuits that are used in the laser printers. This has helped shorten the time of response in the market conditions. Its backward integration has helped control of the final product. This business alignment, especially taking over Compaq, may not have had impacts in terms of improving the supply chain. This includes the slumping of its stock. However, through this form of integration, the company has managed to remain popular in the competitive market, making it one of the most preferred technologies in computers, laptops and other products.
This form of integration is where assets, infrastructures, and companies in the same production levels are integrated. When these company assets are acquired, the results are in the expansion of the already existing operations. This is as opposed to the establishment of new areas of production. An oil company can buy a refinery from a rival company, making the buyer expand an already existing production line as opposed to establishing its own refinery. Sarka ; Pavla (2016) write about horizontal integration and note that hospitals opt for horizontal integration instead of opening up new ones. Sarka ; Pavla (2016) define horizontal integration as the coordination of various activities in a number of operating units that are in the same lines in service delivery. It is where organizations are grouped according to the kind of services they deliver or are under similar levels of healthcare. The advantages accrued in this form of integration is greater efficiency and increased power in the competitive market.
Many governments are cautious when it comes to horizontal integration. There is regulation on the nature of market power a single company, especially in the private sector is supposed to have. This is for the sake of leveraging competition. When one company has a huge control, or it can command an entire market, the results are the creation of a monopoly. This also means that the company can exert its own prices and still control the market.
Concentric diversification as a growth strategy is when a company creates or acquires new products and services for the sake of reaching to more consumers. The services and the products have to be closely related. As written by Kim, Hong, Kwon ; Lee (2017, May), concentric diversification is a strategy that many companies use to enter a new market. It is an effective strategy that makes the company accumulate market power before venturing into a new market. For small companies, concentric diversification makes them have leverage with large companies or multinationals in the competitive market.
Concentric diversification is associated with benefits to the organization like; achievement of economies of scale, ability to expand to new geographies, and acquiring new services and products (Kim, Hong, Kwon ; Lee, 2017 May). Before acquiring a product or a service, Kim, Hong, Kwon ; Lee (2017, May) note that the company must propose and identify areas that are required for concentric diversification. This is done at a product level. This strategy is popular with technology companies. The acquisition of Vitamin Water, Core Power, Fuze Beverage, and Honest Tea by Coca-Cola is a form of concentrate diversification. The strategy of acquiring the small firms in the same line of business is for the sake of increasing its market power in the beverage industry.
Conglomerate diversification as a form of business strategy is when a company adds new products that are different from its line of business. In conglomerate diversification, a company deviates from the original line of business to acquire a new line of business operation. Curi ; Murgia (2018, June) writes that this form of diversification is where two or more companies come together to have one large company. However, in most cases, a large company acquires a smaller or an equal company in the competitive market, but operating in different lines of operations. A technology company, and especially a computer company, can decide to start producing notebooks. General Electric (GE) ventured into the lighting business. It is now a conglomerate known for the ‘general’ aspect of operation as opposed to the ‘electric’ which it acquired. The company has also ventured into production of aircraft, and today, it is one of the largest companies producing jet engines. This production is under the GE Aviation line of business.
Hewlett-Packard has also ventured into conglomerate diversification. It is recognized as one of the most diversified technology companies in the world. It has acquired companies such as Palm, 3Com, and EDS. The former CEO Mark Hurd noted that, in conglomerate diversification, the company was aiming at pursuing growth through expansion and organic innovations. He termed the acquisitions of the small companies as partnership aimed at increasing the company’s presence in the competitive market.
Question 5: ‘Structure Follows Strategy’
In an organization, the teams of employees and management, the departments, the technology, the processes and the divisions are all aligned to achieve the organization’s strategy. The principle of ‘structure follows strategy as conceptualized by historian Alfred Chandler refers to the fact that all aspects of an organization, especially its structure, are done with the strategy in mind. From the departments and division to the alignment of the reporting relationship, everything is done with the intent of implementing the organizational strategy. According to Swoboda, Morbe & Hirschmann (2018, June), the structure of an organization is designed to achieve the strategies of an organization and not the strategy aimed at aligning the business structure. This is, especially in international business. The suggestion by Alfred Chandler in the 1960’s is that the organizational structure must be done in a way that achieves the strategy the organization has set for itself.
The strategy is the plans that an organization makes so as to achieve both the short-term and long-term goals. It is the planning for an organization meant to achieve the objectives and a higher competitive niche in the market. For this to happen, the organization must align all other aspects of its management, including the organizational structure to achieve the strategies. The basis of Alfred Chandler’s principle is that a strategy is the most important aspect of any organizational management. Borromeo et al (2017, November) write that strategies in an organization are deployed through work structures, work styles, and workforce organization. The effectiveness of an organizational structure is determined by the manner in which other aspects in an organization are aligned. For example, the management of human resource in the organization, the work structure, diversifications, and the general organizational structure, determines how an organization competes in the competitive market and achievement of its goals.
The concept of structure follows strategy is most common in non-profit organizations. Most of the non-profit organizations evolve from small enterprises. Their expansions are based on the kind of strategies they employ, including effective organizational structure and proper management of the organizational personnel. According to Ogliastri, Jager & Prado (2016, February), the Chandler’s ‘structure follows strategy’ concept is the dictum that explains the strategic changes that take place in non-profit organizations. The needs to structure and re-structure in non-profit organizations are anchored on the specific strategy that an organization has set to achieve its intended objectives.
The structure follows strategy is implemented using a top-down planning and governance strategy. In this type of management style, decisions trickle from the top to the bottom-placed employees. Neis, Pereira ; Maccari (2016) write that the top-down management style is where the top management develops the strategies to be implemented by the subsequent levels of management. In Chandler’s principle, the structure and all other aspects of the organizations follow what has been developed by the top management. In international business, the strategies developed by the top management in the mother country are expected to be implemented by every other department, supply chain management team and the branches established in foreign countries.
A number of authors have contradicted the views of Alfred Chandler. According to Ogliastri, Jager & Prado (2016, February), authors such as Certo, Hall, and Peter, the strategy does not follow the structure. Instead, the structure in the organization determines the strategy to be used for organizational achievement. Other studies by Galan, Molina, and Sanchez-Beno suggest that both the structure and the strategy work reciprocally for the organization (Ogliastri, Jager & Prado, 2016 February).
Hewlett Packard has severally restructured its operation to incorporate various strategies designed by the top management. In June 2008, the company announced that it was making a major restructuring of its printer business. In the shake-up, there was the narrowing of a number of divisions under the HP’s printing and imaging group. They were narrowed from five to three. The narrowing was based on the need to focus more on the customer groups. However, while the printing and imaging group was narrowed down to three, a number of other divisions were increased. The company was also partitioned into three major divisions, namely; Central Europe, Asia Pacific and Africa divisions. This form of restructuring was meant to capture the market and customer needs, as well as align the structures to the various strategies the company had developed.
The early days of the Hewlett Packard saw the founders devise a management style dubbed; management by walking around (MBWA). In this strategy, the managers were expected to be always walking around supervising the work instead of managing from an office. Most of their time was spent with the employees instead of directing from the office. The company has over time developed other strategies that are meant to respond to the market competitiveness and customer demands. They include; product differentiation strategies, cost minimization strategies, and market focus strategies. All of these strategies were meant to be followed by any form of organizational structure to be designed. The main focus was on obtaining the market competitiveness. To the present day management, Hewlett Packard is regarded as one of most popular and successful technologically aligned companies in the world. This is down to the nature of strategies it has instituted in the management.
There are a number of best practices that are related to organizational strategies. According to Mueller (2018, June), the best practices in strategy formulation include; global focus, human resource skills, improvement in quality, cost, product innovation, and service; flatter organizational hierarchy, utilization of technology, and effective relationship between the suppliers and the customers. The organizational models meant to follow the strategies may differ from one company to another. However, the most popular organizational structures and models include; the matrix structure, the functional structure, and the divisional structure. A company develops the structure based on the nature of strategies it has developed, and the organizational objectives it has set.
The nature of organizational management is determined by the strategies the organization has set. Profitability is the most popular form of measure of organizational growth and management. The determinants of organizational performance are on how the organization aligns itself with the market demands and the strategies it employs. This paper has analyzed the concept of management as applied in an organization. The paper has evaluated various concepts of organizational management, namely; strategic planning, corporate culture, international expansion, acquisitions and organizational structure. The paper has discussed the Hewlett Packard (HP) Company and the way it utilizes the management concepts for its success.
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