HP at Cultural Crossroads‘HP Way’ or ‘CarlyWay’ ?

Group 5: Ketaki, Himanshu J, Himanshu K, Rashi, Prakhar, Saurabh J

THE HP WAY – ANALYSING HP CULTUREHP’s Organizational Values

1. Management by Objective Each stakeholders from every level needs to contribute to company’s goals by developing objectives

2. Open Door PolicyFreedom to express concerns

3. Open CommunicationPromoting teamwork by giving right training and information

4. Management by WanderingManagers walking through the employees regularly, keeping in touch with employees via impromptu get together

HP’s Corporate Objectives:

5. ProfitProfit by means of increasing perceived good value by customers; always reinvested profits back into the company; no debts taken for the company directly

6. CustomersMutual respect, effective response to customer needs.

7. Field of InterestBusinesses which help continue HP’s tradition of self financing

8. GrowthGrowth for shareholder value and achieve business objectives

9. PeopleJob Security, Job satisfaction ,sharing of success with employees

10.CitizenshipImportance of being a good corporate citizen in each country of operation

Collaborative Approach oriented towards Team Work with importance to people andvalues

Employees, if perfectly, motivated work towards creating breakthrough innovation

Employees, if not motivated well, aim at bringing in products with minor revisions into the market more frequently to acquire the incentive.

Pro

’s

Con’s

- Prevents complacency, if the company is leading in the sector and has no major competitor. - Frequent bonuses keeps the employees motivated to work better.

- Much less chances of registering a huge profit as compared to the competitors when company is not performing well- Will lead to cut down on employee bonuses- Lowered Morale of employees

Pro

’s

Con’s

THE HP POLICIES – PRO’S & CON’S

TECHNOLOGY & INNOVATION

COMPENSATION POLICY

Incentives for employees linked to number of

innovations.

Bonuses given out when the company beats its own

numbers of revenue

Sales Compensation Structure based on performance Feedback based Pay - 360° Feedback concept

Revitalizing HP Labs – Focus on Patents

Cost Prudent Functioning

Competitor Performance based BonusLaid of 1,700 + 3,000 + 6000 Employees (Jan, Apr, Jul) Voluntary Pay Cuts or Forced Vacations

Structured Manager – Employee Ratio

HP – Compaq Merger

THE CARLY WAY

Positivity:- True leadership driving a massive culture transformation.-Necessary for Survival – Industry Standards as benchmark- The new HP way would need people to work together, move faster, and be nimble.- Required HP to master the commoditized technology business instead of sticking to its old innovation driven engineering business.- Focusing on Innovation

Negativity- No Team Work- No Empowerment of employee- Degrading moral value of organization- Dissatisfaction within employees- Too much competence culture- Destroying company’s cherished culture- Hire & Fire policy-Fearful  & uncertain working environment

Carly Way & Its Effects -

Finding

‘Way’

Criticism from

AnalystsEmploye

e Grievanc

es

Resistance from

Stakeholders

Falling Profits

Share Price

Stagnant

Revenues

•More flexibility and understanding to bring about a gradual change.Gradual Change

•Taking inputs from experienced managers and making them a part of decision makingCoalition

•Understand the core culture and not mistake its understanding by what seems apparent. Core Culture

•Understanding the employees , the work culture and the organizational value system.Value System

•Creating and Communicating new VisionVision

•Consolidation of results of small changes before new changesStep by Step

•Performance & Feedback based Pay systems created more stir.Compensation

•Could have made efforts to ensure employee satisfaction .Employee

Satisfaction•Subtle Cost Cutting MeasureCost Cutting

Inclusive Change

WHAT COULD HAVE BEEN DONE DIFFERENTLY?