Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

International Growth And

Human Resource Management Challenges:

A Review Of Hewlett-Packard’s Efforts

To Maintain The HP Way

Erica L. Franklin, (E-mail: efrankl@nova.edu), Nova Southeastern University

Bahaudin G. Mujtaba, (E-mail: mujtaba@sbe.nova.edu), Nova Southeastern University

ABSTRACT

This case is about Hewlett-Packard, its culture, and the problems the company encountered as it

made a journey from a domestic firm to an international organization. The case discusses how the

culture was created, developed, and perhaps lost during the company battle to stay in the top of the

computer, test and measurement instrument markets. This case discusses the national and

international challenges that HP has to deal with and the changes the company has to make in

order to save “the HP way.”

INTRODUCTION TO HEWLETT-PACKARD

ewlett-Packard

(HP) incorporated in 1939 under the ownership of Bill Hewlett and Dave Packard.

By 1979 the company had 52,000 employees and more than 4000 products, as reported by Beer and

Rogers (1995, p. 2). Since the beginning, the company had a different, but concrete culture for

managing its employees. Dave’s idea was that if they could simply get everyone to agree on the firm’s objectives and

understand what the company’s business was; its employees, and eventually, the company, would move in the right

direction.

[

HP was structured as a decentralized organization, where general managers were authorized to make

decisions for their product segments. The firm’s business policies allowed for self-structuring mechanisms within the

firm; and financially, leverage was almost non-existent as evidenced by its minimum long-term debt.

Management by wandering around (MBWA) and management by objectives (MBO) were unique elements

of HP’s corporate culture. Beer and Rogers mentioned that these two elements consisted of tactics in which managers

would spend part of the day walking and talking with subordinates and with other departments in order to improve

communication; and establishing long and short-term objectives that were communicated to all employees (1995, pp.

6-7). Employees had employment security and stability; and the company was proud of its hiring and employee

retention policies. According to Beer and Rogers, the HP employees had an average satisfaction index that was 25%

above the national norm in 1979 (1995, p. 21). However, by the 1980’s Hewlett-Packard’s business units and

organization had severely changed. Rapid innovation in information technology; new companies being created; and

the decline of profits, caused the firm’s stock price to crumble. In order to react, the company was obligated to

downsize and redeploy some of its workers to other units. Downsizing created a larger workload for the remaining

workers and the relocated workers felt alienated. These actions led to disbelief of employees in the HP Way and

caused their morale to decrease.

Special thanks and appreciations go to Erica L. Franklin, Gustavo T. Mariotto, Wibunsiri Jimenez, and Rodrigo M. Goncalves of

Nova Southeastern University who initially worked on the preparation of this case in 2005.

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

In 1989, pressured by competitors, HP was forced to acquire another company. HP’s creators felt that

integrating the culture of the new firm would weaken the internal structure of Hewlett-Packard; eventually eroding the

HP Way. New polices in the company also caused regional managers to lose their independence; as they no longer

had direct influence on their business units.

THE CHALLENGES OF GROWTH

How can one believe in the HP Way when people are losing their jobs?

It is important to remember that,

regardless of industry and organization, most employees will tend to appreciate the company’s desire to avoid layoffs.

So, in the case of HP, this could indicate that employees agreed that change is inevitable in order for the company to

have a spot in the market. So the corporation should develop a different management approach that focuses on the

merits of the program for organizational change. The new approach must emphasize the corporate objectives

regarding people, values and mission. The company should also stress the HP security policy such as compensation

packages, retirement plan, stock options, and relocation opportunities. Employees should understand that downsizing

and redeployment were two better options than layoff. It could also be an opportunity for employees to change

careers. In addition, a psychological support and a mentoring program would also be a good way to ensure employees

still believe in the HP way.

Why don’t practices apply equally across the company anymore?

HP divided its operations between its

computer hardware business and its smaller office products division. Beer and Rogers (1995) suggest that as HP

expanded into the computer segment, resulting in acquisitions, consolidation and outsourcing, this created a feeling of

detachment and fragmentation in employees (p. 14-15). The company had no prior experience in dealing with growing

a company, so as it grew larger, the only way they saw fit was to acquire and expand. This was further complicated by

the fact that HP had no solid, general plan for growth. Substantiating this claim is the evidence that HP only acquired

and partnered with other firms only to gain technical knowledge and not to integrate its organizational culture within

the new firms. This resulted in the company not expanding HP practices across the board to their new partners (Beer

and Rogers, p. 14). These issues would not have been so much of a problem if HP had experience in these procedures

or had sought the use of consultants. That way, the transition process would have been easier and would have allowed

the HP Way to still be used by the firm in light of the new changes.

The firm’s new decentralized structure also conflicted with the HP Way. The company did not factor in the

firm’s mission, objective or vision statements into how the company was expanding and operating. Each of HP’s

business segments also operated more independent from each other. The personal computer, printer, measurement,

tests, and international divisions did not share any common services; each had different customers and target groups;

their management structures were different; technology was implemented differently in each segment; and each

segment also had its own set of distribution channels, all of which further led to lower coordination within the

company and increased fragmentation across units (Beer and Rogers, p. 16, 23). Efforts to bring centralization to HP

for some reason reinforced its decentralized methods. The new bureaucracy that was created increased difficulty in

decision making and other work processes which helped to bring down HP employees’ spirits. All of these actions

further led to decreased coordination in the company’s work practices.

Another reason why practices at HP did not apply across the board can be attributed to how foreign

operations were managed. Foreign managers were converted to only being liaisons between the U.S. and their

subsidiaries. If these managers would have been used to coordinate business in their respective countries with

headquarters, they could actually serve the purpose of employing the HP Way with minor modifications for cultural

work practices in each foreign location. There was also no effort made to ensure the HP Way values were effectively

communicated to the foreign branches. All of these actions and auxiliary actions that took place lead to the decreased

application of HP practices throughout the firm, both domestically and internationally.

Can the HP Way survive in today’s intensely competitive environment?

Yes. The HP Way can survive in

today’s intensely competitive environment. The key to maintaining the HP Way and values like it are to create values

that can be modified when changes in the firm’s internal or external environment occur. The problem most companies

face when trying to hold on to their core values is that the values are sometimes too rigid. Rigid values and processes

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

make it hard for a firm to adapt to environmental changes and to effectively implement new processes into the firm. If

a firm instead has values that provide a good foundation and culture on how to operate without specific guidelines, the

values can then be adjusted to incorporate new changes within and outside the firm; which allows smooth transitions

and minimal disruptions for employees.

CHALLENGES, OPPORTUNITIES AND ALTERNATIVES

The main problem with HP is that it has lost its touch with employees. As a result, employee morale has

decreased; which can be attributed to numerous factors. With new expansions and some consolidations, HP does not

know how to retain a sense of purpose and familiarity; as had been done in previous years when the company was

smaller. The company needs a way to reconcile decentralized management structures and reporting systems with an

informal corporate culture that still operates and is managed effectively under some form of central control. Is it

feasible to re-employ the HP way or is it better to leave things the way they are?

The problem HP is faced with presents a large opportunity for the company to turn around its practices. The

opportunity is present to rework the management structure; boost employee esteem, return a sense of pride to HP, and

more importantly, link all of the business units together to decrease un-coordination while still retaining autonomy on

some levels. The HP Way values should be redefined to take into consideration the new changes the company has

recently undergone. HP has the opportunity to adapt the HP Way to a new mindset of organizational thinking. There is

also an opportunity to transplant the HP Way into foreign markets; which can be done with some minor modifications.

In order to be successful in the global market, HP has to find a way to adapt its culture to the international

scenario. The core values of the HP way (integrity, respect for individuals, innovation, and contribution to customer

and the community) can still be applied even after the company’s restructuring. The HP Way can and will be

reinstituted into the corporate environment. Employees need the HP Way, although a few structural changes have

occurred, HP can once again become a familiar and tight-knit firm. However, HP is too big to have a decentralized

structure in most of the areas in today’s economy. A new structure has to be developed and the HP tradition, in terms

of structure, would have to be broken down and built up in some areas in order to accomplish its strategies.

To alleviate the problems of decreased coordination between some product segments that use some of the

same functions, it is necessary that key components of these operations be centralized (Beer & Rogers, 1995, p. 16).

Further coordination of the HP Way in the foreign subsidiaries also needs to be implemented so that practices can be

standard across the board.

IMPLEMENTATION PLANS: REDEFINING THE HP WAY

Boost employee morale.

Figure 1 provides a pictorial view of redefining and reinstituting the HP Way. The

main step in getting HP back on track with workers, is to regain the trust, satisfaction and morale of its employees.

However, what employees must understand is that when a business expands, the sense of closeness and familiarity

will erode to a certain extent. On the other hand, the firm itself needs to realize that the key to keeping a business

afloat internally is to always integrate its core concepts, values and beliefs into any venture the company will embark

upon.

As had previously occurred in the past few decades, HP had at once instituted a formal training program for

all employees on the values and practices of the firm. This was necessary to enlighten all workers on how processes

work at the company. In order to get back the employees’ sense of familiarity, it is necessary to continue or reinstate

this program with some minor modifications. The five values of the HP Way are: 1) trust and respect individuals; 2)

continually focus on achievement and good contributions; 3) conduct HP business with integrity at all times; 4) strive

to use teamwork when achieving company objectives; and 5) use flexibility and innovation in all processes at the firm

(Beer & Rogers, 1995, p. 20). The five main organizational values of the HP Way need to be effectively conveyed to

employees when they are hired. These values should also be used as a starting point for work processes and serve as a

general guideline for how business is conducted within the HP framework. It is not necessary to implement each value

using a defined set of criteria. This training should focus on the overall nature of the values instead of how the culture

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

specifically operates so as not to seem too rigid or too controlling for the employees. By providing this type of

training, the values can be modified and adapted to future changes and situations at HP. This ensures the HP Way will

be continued with any new endeavors of alteration the firm will encounter.

Teamwork.

It will also be wise to bring back some level of teamwork into the organization. The re-

introduction of the HP Way can lead to reapplication of some of the values and practices that were favored in the past.

According to Beer and Rogers, the biggest issue within the company was employees feeling that the concept of

teamwork had been abandoned by the firm (1995, p. 17). It is still possible, even with the expanded Hewlett-Packard

that teamwork can occur on some levels. Teamwork should not necessarily mean consensus when making even the

most minor decision; but should mean that employees within a department or division should work together to

accomplish their tasks in line with the goals of the company and their unit. Decisions for major issues can be made

autonomously at the product unit level, but can involve team decisions that are contributed to by employees at the

divisional, group and department levels.

Divisional reviews.

The process of divisional reviews will be improved to better evaluate each of the firm’s

business units. Beer and Rogers (1995) state that employees felt very strongly about this issue and thought that the old

process of conducting these reviews was sufficient (p. 8). To revamp this process, the divisional reviews should be

conducted separately and not lumped together with other units. This would ensure that each division receives an

accurate and thorough assessment so any changes that need to be made will benefit each division to the fullest. When

using the current method of evaluating the group, it is hard to tell how effective each division of that group is and how

beneficial or disadvantageous a division is being to the group. To alleviate this, division reviews can still be conducted

jointly at the group level to gauge the effectiveness of the group; however, separate divisional reviews still need to

take place at each divisional level to accurately gauge the performance of each unit. This evaluation should then be

compared to the evaluation that is done at the group level in order to see how the divisions are affecting the group as a

whole; which allows for more beneficial recommendations to be made.

Time use.

To alleviate the feeling of ‘being pushed for time’ that is inherent within HP, a new way of

thinking needs to be implemented in the office environment. This could be as simple as letting employees know

‘whenever you finish, its done’ or it can be as complicated as actually changing deadlines or altering work schedules.

The biggest reason cited for the time crunch was fewer workers are available to do more work (Beer and Rogers,

1995, p. 17). At the corporate level, there may not be much that can be done to alleviate the time-crunch except to

incur the cost of hiring more workers and providing time management skills. This may be an effective plan because it

has been proven many times that low morale and stress leads to decreased productivity in the firm. The cost of hiring

and training new workers may well be covered by the benefits of happier employees; more productivity and a lighter

air in the work environment. At the other spectrum, at the lower group, divisional and departmental levels, employees,

both superiors and subordinates should come up with some solutions that work for them to decrease the hurried nature

in the office. The new ethic should be, ‘it is okay to take a break’, or, ‘there is nothing wrong with slowing down

every once in a while to get back on track’. If employees feel they have enough time to do projects, they will be less

stressed and productivity should increase.

Compensation

. There is the option of offering more to employees in terms of compensation measures. The

first step is to emphasize the employment security policy that is in effect at HP. The current policy at HP is to use

downsizing and redeployment in order to avoid layoffs and the negative aspects that come along with letting people

go. To make the policy more attractive, the severance packages should be increased to include better benefits in terms

of monetary value.

TRANSFERRING THE HP WAY ABROAD

The HP way can indeed be transferred to work in other cultures. As mentioned earlier, the HP process of

teaching new hires the HP Way can be done on a superficial level instead of being a specific list of rules and processes

to follow. By not making the HP Way so detail oriented, the main idea of each value is being conveyed; which allows

for the values to be implemented in ways that are customary to the various cultures of the foreign countries. The

values should stand as a general guideline or ethic for working at HP to ensure that foreign work processes can be

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

adapted into the HP subsidiaries while maintaining the HP Way. HP’s expansion into East Asia presented the largest

problem for implementing the HP Way. The training given to employees in Hewlett-Packard’s domestic operations

will be extended to its East Asian operations as well. This is to ensure effective communication and understanding of

the values of the company in order to guarantee that modification of these values can be made. Of the five HP Way

organizational values, the one that stands out most to Asian cultures is the value of using teamwork to achieve

company objectives. Although, this is not to say the other four values cannot be used—they can, with adaptation. The

fact that most Asian cultures are collectivist cultures should be considered in instituting the value of teamwork into

Asian subsidiaries. Expatriate managers from the U.S. and Europe who have individualistic values can modify the

approach to working at HP by emphasizing the value of teamwork to Hewlett-Packard. Since there have already been

problems with instituting the value of trust and respect for individuals, managers should continuously emphasize the

importance of high individual performance within the ‘team’. The idea should be conveyed that the team will perform

better if each individual contributes according to his/her maximum potential. This way, the collectivist nature of

Asia’s social and business culture is being reached through teamwork and the HP value of individual contribution is

stressed, indirectly, to the Asian workers. The bureaucratic style preferred by Korean and other Asian firms should not

be that much of a problem. Since the Asian subsidiaries have operated for a long time, and they are more than likely

staffed by host-country nationals who have proved their talent, it is okay to let them institute their own culturally

sensitive management structure that is in line with the values of the HP Way. This is also a way to better build the

‘trust’ value of the HP Way Asia. When a foreign subsidiary is staffed with local nationals and expatriate managers,

building trust requires working through the personal level to develop relationships with the nationals. HP could

implement these changes with the foreign branches. In order to effectively build trust through relationships, it is

imperative that the expatriate managers get cross-cultural training in Asian culture.

Centralization.

Three of HP’s product segments, the test and measurement segment; the computer systems

segment; and the measurement systems segments all rely on the internal functions of measurement, computation and

in depth communication to research, develop and sell their respective products. Since these segments perform each of

these functions separately, greater coordination, control and maybe cost-effectiveness can be achieved by integrating

the three functions together under one unit that each segment can access. Sharing and better coordination should lead

to efficiency and productivity.

Human Resource Updates and Analysis

Since Beer and Roger’s (1995) original case “Human Resources at Hewlett-Packard” the firm has undergone

quite a few changes to both its organizational structure and the HP Way. Practices within the firm, according to both

insiders and outsiders, have slowly shifted away from the HP Way although; in some aspects the core values of the HP

Way still stand. Most of HP’s recent actions in regards to operations and human resources are completely opposite of

what many perceive to be the HP Way.

Some people feel the decline in the HP Way was brought on by the leaving of founders; while others feel it

was the direct result of the new proxy, Carly Fiorina’s decision to acquire Compaq (Gillmor, 2005; Poletti, 2001).

Although, mergers, acquisitions, layoffs, and reduced compensation benefits and centralized structures were not

originally part of the HP Way, the company had to find a way to survive in the ultra-competitive computer industry.

According to Dale Kasler (2005), “in an industry where product life cycles are measured in months, not years, it’s

believed that HP has to react to changing conditions more quickly” (p. 1). HP, however, has implemented the HP Way

in modified versions that are still based on some of its old pillars across its operating centers.

The declining use of decentralization was also an issue with HP during the late 1990’s. Many workers felt

this was extremely opposite of what the HP Way was supposed to be. Decentralization at Hewlett-Packard was

thought to “increase accountability and entrepreneurship” (Beer & Rogers, 1995, p. 19). More decisions were made to

organize the firm to allow for better coordination among business units; which, as a result, called for the centralization

of some functions. The first functions to be centralized were accounting and financial services for the Americas

divisions. HP created a new financial services division at Colorado Springs known as the Colorado Springs Financial

Services Center (CSFSC). This allowed the company to take accounting, transaction process, and other financial

services away from individual business units such as test and measurements, chemical, etc., and combine them into

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

one single area. The main issue with the CSFSC was that the very purpose it had, centralized operations of all

transaction processing and accounting functions of HP, were contrary to some of the key values of the HP Way—

decentralized, individual operating units and local autonomy within departments. The new center took away the

independence of various departments and business units for their transaction processing and centralized these

functions for the entire company (Shockley-Zalabak & Buffington Burmester, 2001, p. 40).

Further autonomy and decentralization was realized throughout HP and was evident in its three product

groups that were decentralized from the elimination of the Customer Solutions Group. The technology solutions

group; imaging and printing group; and the personal systems group were all given more control of their business in

respect to their “operational and financial decision making” (HP Divisions Change, 2005). Now HP had to deal with

modifying and adapting the HP Way to the new CSFSC. Executives and consultants in Colorado Springs found this

could be done through teamwork. This concept falls in line with the HP Way as one of the organizational values is

teamwork, which was the focus of the modified HP Way at Colorado Springs. The teams were known as self-directed,

virtual teams and were ‘networked’ throughout the entire company. A networked team as described by Shockley-

Zalabak and Buffington Burmester (2001) is the term for “an organization form with elements of the virtual

organization, self-directed work teams, unique relationships with partners, and state-of-the-art processes and

technologies” (p. 9). This networking of the teams occurs through linkages with partners; through the use of

technology, and through processes that facilitate information sharing and helps to accomplish the goals of the

organization.

As part of the HP Way, the use of the teams afforded the workers some form of autonomy in that they were

responsible for all decisions that were derived as a result of their work; they did their own interviewing of prospective

employees; handled meetings and measured performance (Shockley-Zalabak & Buffington Burmester, 2001, p. 63,

83). Managers, or team facilitators, as they are known, are suggested to merely ‘guide’ the teams to a solution for a

customer instead of being told what to do which engenders both responsibility and creativity—a critical aspect of the

HP Way. In fact, teamwork implemented at the CSFSC also allowed for a small portion of decentralization and

responsibility as groups were made accountable for their decisions and outcomes on their projects instead of working

from a top-down management approach. Performance rewards were adapted for the center as well. Instead of

individual rankings, new pay incentives and rewards were based on team performance reviews of the individual

employee (Shockley-Zalabak & Buffington Burmester, 2001, pp. 59-63).

Although workers wanted the HP Way to remain a mainstay in the firm, the company still was not able to

reinstate all of its old practices such as the retiree health-care program, the employee pension plan and layoffs. For

example, the company planned to layoff about 14,500 employees between 2005 and 2007 (Kasler, 2005).

Compensation under the HP Way was also affected as the company expanded. For example, voluntary pay cuts

became more common as the firm asked employees to exercise various options for reduced compensation (The HP

Way, 2001). Other benefits afforded offered to workers were altered as well such as the pension plan for current

employees were abolished and converted to 401k plans (Kasler, 2005). Profit sharing by current employees was

scrapped in favor of newly created performance bonuses (Poletti, 2001). Since 1992 HP has incurred other problems

related to its corporate culture, mainly with its merger with Compaq and Agilent Technologies; a headstrong new

CEO, and other practices that were abandoned by the firm.

Hewlett Packard essentially became two organizations in 1999 when it bought Agilent Technologies and

created two separate companies. Agilent took over the original business units of: 1) Test and Measurement; 2)

Healthcare; 3) Chemical Analysis; 4) Semi-conductor business. The original HP, which in fact became the new HP

focused only on three areas: 1) computers; 2) printers; 3) scanners (Shockley-Zalabak & Buffington Burmester, 2001,

p. 169). HP decided to centralize its accounting and transaction processing services into a single unit to improve upon

customer service and solution making. Local management for each location and business unit controlled all of the

transaction and financial processing for their individual units which led to replication with about 46 ledgers. After the

consolidation and creation of the CSFSC at both Atlanta and Colorado Springs, the numbers of ledgers were reduced

to 36 (pp. 16-17). HP went on to further consolidate its Financial Services Divisions and created the World Wide

Financial Services Division to oversee the Americas Financial Services Division, Asia Financial Services Division,

and Europe Financial Services Division. The CSFSC was taken over by Agilent Technologies, who took over HP’s

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

old business processes of test and measurement, healthcare, chemical analysis, and the semi-conductor group. The

functions of the CSFSC were then integrated with the Atlanta office and the facility became the headquarters for

Agilent’s operations including financial processing (p. 169). Also HP’s acquisition of Agilent Technologies led to

some problems as well with the creation of the Financial Services Center in Colorado Springs. HP’s new CEO who

oversaw the merger with Compaq, Carly Fiorina, was revered by some and despised by others, mainly for her alleged

abandonment of the HP Way. Some thought that Fiorina felt the HP Way was obsolete for the twenty-first century and

that it only held the company back from moving ahead in the industry (Gillmor, 2005).

In 2002 Hewlett Packard underwent another merger to join forces with Compaq to further expand and

solidify its market position in the computers segment. To help merge the two companies’ cultures, seminars were put

in place to facilitate the employees of each of the firms to get to know each other better for better performance in the

office. In order to facilitate this, these workshops called “Fast Start” were initiated to get the employees of Compaq

and HP a chance to work together to learn each other’s personality types, work habits, worksites, etc. In these

sessions, workers also planned and developed business goals for certain incremental time periods. These sessions were

mandatory for all employees and even a portion of executives’ salaries were dependant of their participation in the

workshop.

SUMMARY

In order to apply the HP Way to other areas and geographic locations, the HP Way should be implemented in

each of the new areas with an initial focus on one to three of the five values so that it can be readily modified as was

done at Colorado Springs. In 1979, HP was a company where the employee satisfaction rate was 25% over the country

average; the HP Way was a success as big as the company. However, by 1990 the culture had changed, the company’s

layoff, relocations and acquisitions had worsened the culture and employee satisfaction levels just like company stock

had gone down. In search of the solution, HP decided to centralize its financial and accounting structures. The

company came up with the Shared Service Center (SSC) idea which was an innovative approach to standardizing the

delivery of common processes regarding financial and accounting transaction on one or several locations. The SSC is

an idea created by HP in 1990 to reduce costs while improving services and developing expertise. The main thing

other firms can learn from HP’s experience, is to never lose sight of ‘what business we are in’. Too many times, firms

expand without considering their original mission and objectives. This causes firms to encounter a myriad of problems

with expansion and growth, which negatively affects employees and its external network of stakeholders. It is

important for firms to remember that the vision, mission and overall objectives of the firm shall always remain the

same in order to grow successfully in the domestic and global environments. Another thing other firms can take away

from the situation at Hewlett-Packard is to think about how they can effectively transplant and modify a corporate

culture for diverse workers in diverse environments. Firms need to take heed that ‘what works at home will not always

work abroad’, and plan accordingly. Taking heed of these recommendations along with making sure to develop a solid

framework for business growth can help firms to avoid many common, careless mistakes in future situations.

DISCUSSION QUESTIONS

Has Hewlett-Packard gotten too big to practice the HP Way?

What can be done to better integrate some of the main principles of the HP Way into the merged company

(HP-Compaq)?

Can some of the principles of the HP Way be adapted to other firms in similar situations?

Can the HP Way be successful in different countries across Asia and Europe without any specific

accommodations to the local culture? Discuss and explain.

Can the HP Way be just as successful in both high and low context cultures? Discuss and explain.

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

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Case Study: Human Resources at Hewlett-Packard (A)

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Human

Resources at Hewlett-Packard

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Cross cultural management and negotiation practices

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Oxford University Press: New York, New York.

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

Figure 1 - The New Hewlett-Packard 1995-2006

Corporate

Culture

Business Organization:

Centralized &

Decentralized Units

Team Work

Expanded

Business

Operations

Integration

workshops for

Compaq and HP

employees

Consolidate accounting

and financial services

into one unit with

various locations.

Created Financial Services

Divisions at:

Colorado Springs

Atlanta

European Division

Asia-Pacific

Division

Conduct ‘HP Values’

Training for:

New hires

Veteran employees

Foreign Operations

Mergers

1. Agilent

Technologies

2. Compaq

1. Networked Teams

2. Self-directed Teams

Led to worker empowerment

Team Hiring Process for new workers

Joint work processes

Team responsibility for all decision outcomes

Team decision making

Better communication between workers

More autonomy

Balanced work-load

Better problem solving

10.

Members learn from each other; gain skills from

team work

Restored ‘autonomy’

throughout the firm

Restore Team Work

through CSFSC

Peer evaluations of team

members

Peer Rankings of performance

Centralized Financial Services

divisions into one area in 1999:

Atlanta, Europe and

Asia-Pacific reported to

one director: World

Wide Financial Services

Colorado Springs

consolidated under

Agilent Technologies

New Tasks

HP Spun off the ‘Test & Measurement’ organization to focus on

‘Computer Products’ and ‘Computer Systems’

Agilent Technologies took over Test and Measurement

Segment:

Health Care

Chemical Analysis

Semi-Conductor

Hewlett-Packard Compaq

Computers

Printers

Scanners

Eliminated Profit Sharing

in favor of Performance

Bonuses

Involuntary Pay cuts

Dissolved Customer

Solutions Group into

three groups:

1. Technology Solutions

2. Imaging and Printing

3. Personal Systems

Mass Layoffs

Journal of Business Case Studies –First Quarter 2007 Volume 3, Number 1

NOTES

HP Case Study

Prompt to Clone This HP Case Study

Apply this example's core structure, strategic pacing, and structural hierarchy directly to your own topic.

What are you generating today?

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