UNWE2015

Bozova, Alexandra

Marketing Information Systems

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Contents

I. History.................................................................................................................................. 2

II. Organizational structure.......................................................................................................... 4

III. Marketing Mix ................................................................................................................... 5

IV. Competition management .................................................................................................... 8

V. Strategic information management............................................................................................ 9

VI. Positioning....................................................................................................................... 11

VII. Strategy .......................................................................................................................... 12

VIII. HP platforms for customers ................................................................................................. 14

IX. SWOT ............................................................................................................................ 15

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I. History

The HP Garage

Tucked away on a quiet, tree-lined residential street near StanfordUniversity, the HP Garage stands today as the enduring symbol ofinnovation and the entrepreneurial spirit. It was in this humble12x18-foot building that college friends Bill Hewlett and DavePackard first pursued the dream of a company of their own. Guidedby an unwavering desire to develop innovative and useful products,the two men went on to blaze a trail at the forefront of the electronicsrevolution.

The history of the HP Garage The garage stands behind a two-storyShingle Style home built for Dr. John C. Spencer about 1905. The

exact construction date of the garage is unknown, but while there is no evidence of its presence on insurance mapsdated 1908, by 1924 it is clearly denoted on updated documents as a private garage. In 1938, Bill Hewlett and DavePackard decided to “make a run for it” in business. Dave left his job at General Electric in Schenectady, New York,and returned to Palo Alto while Bill scouted rentals. He found one perfect for their needs on Addison Avenue.Chosen specifically because of a garage he and Dave could use as their workshop, the property also offered a three-room, ground floor flat for Dave and his new wife Lucile and an 8x18-foot shed for Bill. They shared the $45 permonth rent. The garage served as research lab, development workshop, and manufacturing facility for earlyproducts, including the Model 200A audio oscillator. The company, founded in 1939, was named with a coin toss.The garage was soon outgrown, and in 1940 HP moved into larger quarters nearby on Page Mill Road.

1960s

HP partnered in the 1960s with Sony and the Yokogawa Electric companies in Japan to develop several high-qualityproducts. The products were not a huge success, as there were high costs in building HP-looking products in Japan.HP and Yokogawa formed a joint venture (Yokogawa-Hewlett-Packard) in 1963 to market HP products in Japan.

HP spun off a small company, Dynac, to specialize in digital equipment. HP experimented with using DigitalEquipment Corporation (DEC) minicomputers with its instruments, but after deciding that it would be easier to buildanother small design team than deal with DEC, HP entered the computer market in 1966 with the HP 2100 / HP1000 series of minicomputers. These had a simple accumulator-based design, with registers arranged somewhatsimilarly to the Intel x86 architecture still used today. The series was produced for 20 years, in spite of severalattempts to replace it, and was a forerunner of the HP 9800 and HP 250 series of desktop and business computers.

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1970s

HP introduced the first commercial "desktop computer" - HP called it a desktop calculator, because, as Bill Hewlettsaid, "If we had called it a computer, it would have been rejected by our customers' computer gurus because it didn'tlook like an IBM. We therefore decided to call it a calculator, and all such nonsense disappeared." The companyearned global respect for a variety of products.

1980s

In 1984, HP introduced both inkjet and laser printers for the desktop. Along with its scanner product line, thesehave later been developed into successful multifunction products, the most significant being single-unitprinter/scanner/copier/fax machines. The print mechanisms in HP's tremendously popular LaserJet line of laserprinters depend almost entirely on Canon Inc.'s components (print engines), which in turn use technologydeveloped by Xerox. HP develops the hardware, firmware, and software that convert data into dots for themechanism to print. On March 3, 1986, HP registered the HP.com domain name, making it the ninth Internet .comdomain ever to be registered.

1990s

In the 1990s, HP expanded their computer product line, which initially had been targeted at university, research,and business users, to reach consumers.

HP also grew through acquisitions, buying Apollo Computer in 1989 and Convex Computer in 1995.

Later in the decade, HP opened hpshopping.com as an independent subsidiary to sell online, direct to consumers;in 2005, the store was renamed "HP Home & Home Office Store."

In 1999, all of the businesses not related to computers, storage, and imaging were spun off from HP to form AgilentTechnologies.

2000s

On September 3, 2001, HP announced that an agreement had been reached with Compaq to merge the twocompanies. In 1998, Compaq had already taken over Digital Equipment Corporation. HP therefore still offerssupport for the former Digital Equipment products PDP-11, VAX and AlphaServer.

On May 13, 2008, HP and Electronic Data Systems (EDS) announced that they had signed a definitive agreementunder which HP would purchase EDS. The agreement was finalized on August 26, 2008, and it was publiclyannounced that EDS would be re-branded "EDS an HP company." As of September 23, 2009, EDS is known as HPEnterprise Services.

Hewlett-Packard acquires 3Com for $2.7 billion in cash.

2010s

HP's acquisition of Palm

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On August 18, 2011, HP announced that it would strategically exit the smartphone and tablet computer business,focusing on higher-margin "strategic priorities of Cloud, solutions and software with an emphasis on enterprise,commercial and government markets".

2014

HP announced the split into two companies -one selling personal computers and printers (HP Inc.) and anotherselling servers and other business equipment and services (Hewlett Packard Enterprise).

II. Organizational structure

The company wide portfolio consists of two types of products: consumer and enterprise:

Corporate structure

HP will split into two companies: HP Inc. incorporating IPG and PSG towers and HP Enterprise – incorporating TSGand HP Financial Services. HP Inc main focus is on volume, while that of HP Enterprise will be – time.

IPG – Imaging and Printing Group - the leading imaging and printing systems provider in the world for printerhardware, printing supplies and scanning devices, providing solutions across customer segments from individualconsumers to small and medium businesses to large enterprises.

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PSG – Personal Systems Group - one of the leading vendors of personal computers ("PCs") in the world based onunit volume shipped and annual revenue.

TSG – Technology Solutions Group - incorporates HP Technology Services, Enterprise Services (an amalgamationof the former EDS, and what was known as HP Services), HP Enterprise Security Services oversees professionalservices such as network security, information security and information assurance/ compliancy, HP SoftwareDivision, and Enterprise Servers, Storage and Networking Group (ESSN). The Enterprise Servers, Storage andNetworking Group (ESSN) oversees "back end" products like storage and servers. HP Networking (former ProCurve)is responsible for the NW family of products. They are a business unit of ESSN.

HP Financial Services - HP Financial Services delivers investment solutions that maximize the full potential of IT tocreate better business outcomes.

III. Marketing Mix

Market share

To remove some of the product cycle impacts to revenue swings I’ve put together a spreadsheet that tracksrevenue since the first quarter of 2011. Starting with the fourth quarter of 2011 IBM was the market share leaderat 31.5% with HP in a close second at 29.3%. Dell was a distant third at 15.0% and Cisco, now the fourth placevendor, coming in at 2.1%. HP continued to trail IBM until the December 2013 quarter when it became the marketshare leader at 26.7%, IBM came in second at 25.7% with Dell picking up some share at 16.8% and Cisco more thandoubling its share to 4.9%. IBM may regain its lead with a mainframe refresh (but will lose revenue and share when

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it sells off its low-end server business to Lenovo) so overall it looks like HP will be the server market share leaderfor the near future. It appears that Oracle may have stopped the bleeding in its server business with 2% revenuegrowth in the March quarter.

Products

HP produces lines of printers, scanners, digital cameras, calculators, PDAs, servers, workstation computers, andcomputers for home and small-business use; many of the computers came from the 2002 merger with Compaq.HP as of 2001 promotes itself as supplying not just hardware and software, but also a full range of services todesign, implement, and support IT infrastructure.

Printers PC’s and LaptopsPrinters category o HP Spectreo Laser Jet printers o HP ENVY

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Price

In 2003 Hewlett Packard introduced another first in pay-per-use utility pricing by offering automatedtechnology that can measure the percent utilization of each central processing unit (CPU) on HPSuperdome servers, thereby offering significant advantages to customers during slow periods so they donot pay for processing they do not utilize.

Hewlett seeks to design products with features and esthetics aimed specifically at consumers. It will firstestimate how much consumers will pay, then design products to sell at that price.

Place

Hewlett Packard company headquarters are located at 3000 Hanover Street Palo Alto California. HP has subsidiaries located in Miami, Ontario, Geneva, Tokyo, Houston, Singapore, Victoria and Rivonia. Hewlett Packard operates a worldwide program for independent software vendors, developers and

system integrators called the Developer & Solution Partner Program (DSPP). The HP website provides a partner locator service sorted by small and business, home and home office,

large business enterprises, as well as type of product needed. HP International - HP legal entity spanning over multiple EU countries as well as Norway and Switzerland.

Material can move x-border within HPI without triggering sales transactions. Movements are financiallyconsidered as inventory transfer. However they are submitted to VAT and intrastate declarations.

Operates in AME, EMEA and APJ regions The main warehouse is situated in Beringe, Netherlands and just in EMEA has over 200 plants

Promotion

HP launched a branding initiative called, “One Voice,” to better integrate its vast line of consumerelectronics and computer hardware products.

HP uses many vehicles to tout its business solutions products and services, including a website with videosand navigation by sorted by business application.

Key Hewlett Packard employees host blogs covering topics such as networking, servers, enterprisessoftware and storage.

Hewlett Packard employs a “Trade-in Program” whereby a customer can get a free quote on an old productand trade it in on eligible products.

HP is promoting an instant $300 savings on its ISS Proliant AMD Servers. Hewlett Packard is offering limited time 0% financing on qualifying products and services. HP provides special care packs and warranty programs aimed to increase customer value. With the greatly developed delivery chain, HP seeks to provide the right part/product to the right place at

the right time.

o Color Jet printers o HP Paviliono PSC/Photosmart All-in-one printers o HP EliteBook/ ProBook/ZBooko Photosmart printers

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IV. Competition management

HP competes successfully in the market by maintaining the high –performance business:

Effectively balance current needs and future opportunities, Consistently outperform peers in revenue growth, profitability and total return to shareholders, Sustain their superiority across time, business cycles, industry disruptions and changes in leadership. commitment to sustainability

The information that HP seeks is mainly related to the customer need and providing customer value.

Growth

HP is using its sustainability strategy to drive real revenue growth through four approaches: by winning newbusiness while retaining existing business, by expanding the company’s distribution in Europe, by charging apremium price for energy-efficient products and by entering new markets.

Profitability

Within HP’s own operations, the company is leveraging its sustainability strategy to drive profitability through awide range of efforts—everything from making adjustments to shipping and logistics and reducing the need forvirgin materials in manufacturing, to realizing cost savings through new efficiencies within data centers, toreplacing business travel with virtual meetings.

Consistency

To ensure that its sustainability and corporate social responsibility (CSR) efforts stay true to their aims and areproviding the kind of measurable returns this high-performing company insists on, HP has several processes inplace to regularly assess and revise the company’s strategy. Some of the most effective processes have been theresult of a radical move toward transparency, which has helped to co-opt the services of “watchdogs” andleveraged them to HP’s long-term advantage.

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Longevity

HP has always had a competency in long-term planning and vision. Additional product and marketing innovations(beyond the Pavilion/ Wal-Mart collaboration) are in place for the long-term as well, and the company hasestablished ambitious stretch goals in areas like carbon emissions. It is clear that HP aims to achieve and retainleadership positions across as many dimensions as possible, with strategies that take a very long view. Critical toexecuting these visions will be the company’s ability to maintain a “white hat” position amid growing public andregulatory scrutiny.

V. Strategic information management

The company's business service automation (BSA) platform was designed to make IT systems management moreeffective and efficient. By automating change and audit processes across every technical aspect of the businessservice - clients, servers, applications, network devices and storage elements, for example - BSA encompasses twomajor functional areas.

HP's product strategy was to bring together its Data Center Automation Center (DCAC) and Client Automation Center(CAC). The former manages technology within datacentres and networks, ande the latter automates key ITprocesses across the management lifecycle of client devices, no matter where they are.

"Our concept is business technology optimisation," says Alex Wilson, software manager for HP. "It's the frameworkfor understanding the breadth and depth of systems management. We say there are three key areas within IT -design, build and operating functions."

HP tries to embody this strategy in three major areas of functionality in its business service management (BSM)products Operations Center, Network Management Centre and Business Availability Center.

Operations Center monitors, controls and reports on the health and performance of mixed IT environments,including networks, systems, databases, applications and core services. It has features to fine-tune performanceand availability.

Business Availability Center is another tool that monitors the health of business services and applications, but fromthe perspective of the service user. This brings in new dimensions, such as business impact, risk and service levels,with incident and problem-management processes.

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The strategy is to build a model that looks beyond collaboration across all the different silos of information, saysHP's Wilson. "Everything we do is measured against the yardstick of business outcomes: what is the service thatthe business wants, what are the metrics, is the project being designed to meet them?"

By purchasing systems management companies and bringing their automation and network management featuresinto the fold, HP has added to its legacy strengths, says Roy Illsley, senior research analyst at Butler Group.

"In some of these areas, it has broadened its coverage of customer needs considerably," he adds.

BSA, along with BSM and ITSM (IT service management), is one of the primary functional areas defined by HP togroup together service management capabilities according to the ways organisations use them. But rather thankeep these areas separate, many are already interlinked and HP is developing further integration.

The CMDB (configuration management database) is an important part of HP's overall approach, because it enablesdata to be shared and a single version of any piece of information to be available across all functionality. HP's ownUniversal CMDB product can be used, or rival systems can be integrated. Indeed, integration capabilities areavailable within all the components that allow legacy management (or other) tools to be leveraged, if required.

Automation has long been the ideal approach to IT operations, but it is a vision shrouded in technical jargon andlong-winded, unreadable language, says Illsley. But BSA offers powerful capabilities for managing IT systemswhich operate together to create a vital aid for IT managers looking to serve their organisations with the best ofmodern technology and IT management practice.

Companies can therefore adopt a more visible and accessible automated approach to systems management. Thereis good potential for efficiency gains and further benefits. It could help to make business policies the drivers of ITmanagement processes within datacentres and networks, extending to client devices.

HP could add further enhancements to integrate this broad range of capabilities. But this is not necessary in thearea of heterogeneous technology coverage, where BSA has been able to address, "out of the box", mostorganisational challenges. The added benefits of compliance assurance and operational consistency can beextended to wider management processes if organisations want to commit more fully to HP's range of business-oriented technology.

After buying and integrating a number of rival start-up companies with technology in or around the systemsmanagement (and the associated service management) space, BSA proves that, from the enterprise customer'sperspective, HP has made good investments.

Software originating from multiple sources has caused some integration issues, which HP has not resolved in thisfirst release, CMDB integration being the most important.

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VI. Positioning

Strategy

Hewlett-Packard’s strategy for data centers, and IT in general, is to off er a one-stop shop. HP alone encompassesEthernet networking, servers, storage, services, and the management necessary to run them all together, all fromtheir own price list. Hewlett-Packard is positioned to continue to take advantage of the wave of automation thefully virtualized data center demands, especially since the integration of 3Com. One of HP’s strategies is to providevalue to the customer via simplicity of management and increased business agility, while reducing their cost ofownership. With increasing alignment across the key technologies that data centers require, HP is focusing oninfluencing the market while demonstrating leadership as enterprises address their cloud needs and the enterpriseinfrastructure of tomorrow. HP’s strategy remains sound, though where infrastructure ranks relative to the manyother investments for which President and CEO Meg Whitman is now responsible will require a couple of quartersto clarify.

Solutions/Products

Hewlett-Packard’s product lines are many and varied, but they all share the same characteristics of ease of use andoften a reasonable price. HP spends considerable money on research and development, some of it product-directedand some of it component-directed, though less than its peers by percent of revenue. Paired with its strong R&D,HP’s occasional acquisition (or even the much larger purchase of EDS) keeps the company’s product linescompetitive. In addition to that, HP has a large software division that covers everything from systems managementto security platforms. Th e services organization, bolstered by the acquisition of EDS, is one of the largest in theworld and capable of handling any IT task a customer may need.

Marketing Strategy

Hewlett-Packard’s marketing strategy essentially focuses around solving problems, from consumer to full-blownenterprise. HP’s approach appeals to customers, as its messaging generally sticks to solving problems once youget past the hyperbole. HP also accents its depth of product line as a diff erentiator, in addition to a truly globalpresence. With products that meet nearly every IT need a customer faces today, solving problems faced around theglobe, and with the ability to sell in every major market in the world, HP is a very well-known brand.

Sales and Support

HP uses channel partners and resellers to sell the vast majority of its products and services, with the exception ofcustomers that require direct touch at the top of the enterprise spectrum. HP’s network of dealers and affi liatedresellers is huge, and many of these partners have been selling HP’s equipment for decades. HP off ers numerouslevels in which channel and reseller partners can participate. Th ese include training, both sales and technical, aswell as co-marketing funds for the upper levels. HP’s channel support and management program is one of thestrongest and broadest in the industry, which benefi ts every business unit within HP.

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Partnerships

HP is often the target of partnerships with other technology companies, rather than seeking them out. Th at beingsaid, HP maintains partnerships with hundreds of technology companies that span every solution enterprise andcarrier’s need. HP typically forms partnerships for two reasons: one, to gain access to technology it is unwilling orunable to develop for itself; and two, to ensure crosscompatibility of technologies with market leaders, thussmoothing interoperation with complementary and competitive technologies. A technology partnership thatincludes HP reselling a vendor’s products can make or break a startup and is often considered a sign of signifi cantprogress for smaller companies.

VII. Strategy

HP strategy is focused on:

Supply chain – delivering the right part in the right place at the right time Innovation Climate and energy Longevity Sustaining long-term partnerships Product reuse and recycling

HP also sustains the so called “Living progress strategy”

Citizenship has been one of the seven corporate objectives since 1957, and HP is proud of the legacy as a globalcitizen. But aligning citizenship activities with the business is not enough. The two must become one.

In 2013, HP took a major step in this direction by adopting HP Living Progress as our framework for thinking abouthow HP do business. HP goal is to create a better future for everyone through our actions and innovations.

Living Progress drives what HP do and how HP do it, creating a vibrant and sustainable business model by tacklingsome of the world’s biggest problems. This wholly integrated approach to business means that HP consider human,economic, and environmental impact as HP develop products, services, and solutions, manage our operations, andinteract with customers, partners, and communities.

Creating value for our business and society

Over the last 40 years, information technology (IT) has redefined our world. Driven by trends in mobility, cloud,security, and big data, IT is changing business processes, personal productivity, and much of the way HP live, work,and connect. It also has the potential to advance societies globally.

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Living Progress unites the power of the people and technology in innovative new ways to meet society’s emergingsocial, commercial, and environmental needs. It creates value for the business by contributing to sales growth,promoting cost savings, and enhancing our reputation.

Global citizenship governance

HP global citizenship performance depends on effective leadership, sound governance, and active participationfrom everyone in the company. In 2013, HP created the role of vice president and chief progress officer to ensurethat Living Progress initiatives are reflected throughout our products and services, our business practices, ourrelationships with our employees and supply chain, our advocacy efforts, and our corporate philanthropy.

In addition, the HP Board of Directors’ Nominating and Governance Committee expanded its oversight of globalcitizenship efforts, and changed its name to the Nominating, Governance and Social Responsibility Committee.

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VIII. HP platforms for customers

Customer Experience Services

CX Services deliver the experience your customers want at a lower TCO for your business. HP optimizes yourrevenue with a unique omni-channel service combining analytics, technology, and people in new and innovativeways.

Customer Experience as a Service

Customer Experience as a Service (CXaaS) is a cloud-based service with omni-channel management, providing acomplete suite of contact center tools, communications network, and operational processes. This service isdeployed on a consumption basis in an “as a service” model. Key to this service is the ability for you to use yourown agents, HP agents or third party agents. HP has teamed with Avaya Private Clouds Services to provide thisservice.

Customer Experience - Omni-channel Services

CX - Omni-channel is HP’s core contact channel offering, providing the global management and operation ofcustomer contact channels. It includes agent services, and infrastructure to handle inbound, outbound andintegrated omni-channel support for customer interactions. HP’s services include support for over 350 clientsglobally with 23,000 Agents across 200 locations, handling 400 million customer interactions per year.

Customer Experience - Analytics Services

CX - Analytics captures, analyzes and optimizes customer information to provide valuable insights to attract,acquire and retain customers. This service focuses on social media content and specifically integrates unstructureddata as a key component to providing deeper customer insights. Key to this service is a “Rapid Cycle Prototype”where HP proves out an analytics based business case in 90 days, with a focus on maximizing your ROI and seamlessintegration with your existing systems.

Customer Experience – Transformation Services

CX Transformation Services is the consulting and advisory group of our CX services. HP’s consultants develop andimplement roadmaps to focus on both operational strategies to reduce costs, as well as customer focusedstrategies, such as customer journey maps to capture additional market share. HP advisors offer provenapproaches and metrics to track and improve customer satisfaction, upsell, renewals and enhance new metricssuch as Net Promoter scores.

Customer Communications Management Services

HP’s Customer Communications Management Services enables your enterprise to consolidate, transform,personalize, and measure customer communications at your own pace while maximizing your existinginvestments.

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Consumer Direct Services

HP Consumer Direct Services works with companies to manage those processes and minimize the associated costs.We enable you to outsource all of your direct-to-customer interactions—from customer service and ordering toproduct fulfillment and distribution. We take orders from multiple channels—phone, web, mail—and then pick,pack and ship products to your customers. And we handle the back-end processing through credits and returns.

IX. SWOT

Strengths• Hewlett-Packard’s biggest strength in the data center market is the footprint of products and services it canprovide. HP’s involvement in servers, storage, networking, data center management, software, and services makesit a strong player. HP can cross-sell all of its data center off erings and rely on partners for things that it does notdirectly provide, such as server virtualization. Additionally, HP has a huge infl uence in the market with its bladeserver line of products that are well suitedto virtualized environments.

• HP has a broad portfolio of capabilities and products that satisfy environment needs from small to large. Inaddition, since the close of 3Com two years ago, HP has become the undisputed number two Ethernet switch vendorby revenue and market share, and it possesses a portfolio to compete with Cisco across most of the infrastructureany business would need.

• HP is one of the top providers of x86 server systems and has been for years. Its HP BladeSystem is particularlysuited towards physical machine consolidation and machine consolidation via virtualization. HP’s BladeSystemcombines machine power with the fl exibility of quick expansion within its frame. As with all of HP’s products,particular attention has been paid to the management interface with an eye for ease of use. HP’s x86 serverproducts, blade and otherwise, are strong in the market place and regularly compete with IBM, Oracle (Sun), andDell for supremacy in the data center.

• HP is taking a relatively neutral stance between virtualization vendors, off ering Microsoft, VMware, and Citrix,each with equal enthusiasm. Since HP does not have its own server virtualization software, this is a sensibleposition that allows the customer to pick the virtualization vendor they prefer based on business need, rather thanhaving to use what HP prefers. HP’s neutral stance is good for VM competition and good for its customers. Inaddition, it requires the HP’s services team to remain experts across all virtualization off erings and be able toconsult with customers, providing guidance as to the best choice.

• HP’s strong presence in the storage market is a direct result of its acquisition of Compaq years ago. Th e storagedivision is in regular and intense competition with rivals such as IBM and EMC. HP’s main advantage against acompetitor such as EMC is its associated and complementary product lines. Multiple product lines allow customersto thin vendor lists and only have one neck to choke in the event of an issue. HP puts considerable development effort into its storage products, from both a block and a fi le product perspective, and it has seen considerable success,especially with customers already using HP hardware for their servers. Additionally, since its acquisition of 3Par,HP has demonstrated clear intent that it intends to remain a leader in the storage space, and in particular, it seesstorage virtualization as a key growth opportunity.

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• With a formidable sales force, fi nance arm, and professional services division, HP is well-positioned to sell itsproducts to a wide range of enterprise customers, and it is doing exactly that.

Weaknesses

• HP’s corporate governance and vision is a bit lost currently, in addition to numerous executive changes. MegWhitman has a challenge ahead in restoring healthy growth and sound business mechanics to all aspects of HP,and the eff ect will be felt by all BUs to a degree. According to Whitman, “We’re struggling under our own weight.And we’ve got to restore a healthy balance in order to return HP to its position as a growing‚ thriving‚ innovatingindustry leader.”

• HP’s off erings are large and varied; it is easy for customers to get not just bewildered, but frustrated when tryingto purchase data center infrastructure equipment, software, or services. HP’s Web site is well organized, but thesheer size of HP tends to defy easy organization. Customers must rely on resellers and HP itself to fi nd what theyneed (and in the correct confi guration).

• HP competes extensively in the consumer market for PCs, printers, scanners, and cameras, amongst otherproducts. Most of its largest rivals (e.g., IBM and Sun) do not have the distraction of the volatility of the consumermarket and can remain focused on enterprises. On top of that, HP’s enterprise equipment is sometimes positionedby competitors as being of the same quality level as its consumer-grade equipment, which is a patently unfairobservation but a reality in a competitive market.

• HP’s second place is a distant one to Cisco, which commands four to fi ve times the market shareof HP. In addition, Cisco refocused and doubled its eff orts over the last nine months on this corebusiness, which means that competitive pressures will continue to increase for all vendors in theinfrastructure space.

Opportunities

Expanding presence in cloud computing market – Cloud computing describes a new delivery model for ITservices. In July 2008, HP along with Intel Corporation and Yahoo! created a global, multi-data center, opensource test bed for cloud computing research and education. The goal of the project was to promotecollaboration among industry, academy and governments by removing the financial and logistical barriers. In2009, HP announced HP Cloud Assure, a new SaaS offering designed to assist businesses to safely andeffectively adopt cloud-based services. HP Cloud Assure consists of HP services and software, including HPApplication Security Center, HP Performance Center and HP Business Availability Center. These solutions aredelivered to customers though HP SaaS platform. The increasing demand for cloud computing is likely to createdemand for HP’s solutions in coming years. The global spending on cloud computing is forecast to cross a valueof over $40 billion by 2012

Expanding portfolio of imaging and printing solutions – Hewlett Packard has made several strategicacquisitions and introduced new products in the imaging solutions segment in recent times. Its imagingsolutions strategy entails the commercial markets, from print services solutions to new growth opportunitiesin commercial printing and capturing high-value pages in areas such as industrial applications, outdoorsignage, and graphic arts. Among those key acquisitions are Tabblo, Logoworks, MacDermid and ColorSpan.

HP has launched several retail photo printing solutions and services that provide consumers the tools topersonalize their photos and publish customized creative output. In addition, it has introduced new digitalprinting technologies, HP Inkjet Web Press, HP Latex Inks and three HP Indigo presses, as part of its graphicarts offerings. In October 2008, it also announced a plan to launch full wireless HP Photosmart printer line-upby 2010.

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Threats

Projected decreases in the IT markets – Forecasters predict a decrease in the worldwide demand forvarious IT products offered by HP. The economic slowdown has negatively affected many marketsegments, including information technology. Hewlett Packard has experienced this decline not only in theU.S. but also in its global markets. Worldwide spending on IT was predicted to decline by 4% in 2009.

Hyper-competitive environment – Although Hewlett Packard recently overtook Dell in sales, the latterremains a formidable competitor, as are other companies such as Toshiba, Lenova Group and Aver. Itcompetes in terms of price, quality, brand, technology, reputation, distribution and range of products,among other factors. In some regions, the company faces competition from local companies and fromgenerically-branded or white box manufacturers.

Specifically, the company’s competitors in enterprise servers and storage include IBM an in storage thereis the EMC Corporation, Dell in industry standard servers and Sun Microsystems in UNIX-based servers. Theimaging and printing group’s key competitors include Canon USA, Lexmark International, XeroxCorporation, Seiko Epson Corporation, Samsung Electronics and Dell. HP even faces competition from re-manufacturers including private label brand stores, supply stores such, internet vendors and originalequipment manufacturers (OEMs) such as Lexmark. The re-manufacturers buy the original cartridges fromcustomers, refill them with their own ink and resell them at a discount to the branded OEMS. These entitiesprovide a continuous source of competition which could impact the profitability of HP.

Recommended Actions

Recommended Vendor Actions• HP should remain vendor-neutral in the hypervisor market, and it should even consider expanding its support forsmaller virtualization players such as Red Hat, in particular for its SMB/SME eff orts. HP can continue to keepcustomers happy and provide market choice by maintaining a neutral stance, despite the extra money it costs tocertify several hypervisors on its x86 server systems.

• HP possesses a comprehensive networking portfolio for all environment sizes. However, overlap and confusionremain in the product line and further eff orts are required, primarily SKU reduction and product guidance forchannels and enterprises alike.

• HP needs to address the means to manage multiple operating systems on its switches and multiple elementmanagement platforms to provide direction for the installed base and partner communities alike. A roadmap andan aggressive trade-in program should eliminate most customer defection, and with a consistent product line andthe large installed base, HP will remove one of the weaker competitive attack points for other vendors.

• HP needs to do a better job of getting its resellers to sell the entire HP package (servers, storage, networking,software, and services) to customers. HP’s products in all of these spaces are compelling, but there is morebusiness, in particular by attaching its networking products more aggressively to server and storage customers.

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HP took a solid fi rst step towards enabling this with the ExpertOne certifi cation in late 2010; however, thereremains little ‘glue’ to incite HP networking preference over competitors. Th is will help ensure partners andcustomers receive more cross-technology integration and deployment training in addition to educating the partnercommunity on how to sell and integrate the complete solution, making engagements repeatable and predictable.

• HP should continue developing market incentive programs for its networking products that turn competitive bidsinto discounts for customers and channel partners. Both partner compensation and customer rebates or moreaggressive promotions could drive signifi cant opportunities to HP.

Recommended Competitor Actions

• All of the x86 server virtualization vendors need to try to get closer to HP in any way they can. HP is not likely topick one over the other, but a close relationship will get more people at HP to recommend that vendor’s product.Th is is particularly true when you consider HP Services. A close tie to HP’s services division, with lots of education,will yield positive recommendations to customers.

• Dell needs to increase the amount of software it off ers if the company wants to compete in the long term withHP and IBM. Dell has the x86 hardware and is growing its storage off erings, but until it becomes a bigger softwareplayer, Dell will be at a competitive disadvantage with HP. In addition, Dell’s network strategy play needs to bemore clearly articulated against HP and IBM’s off erings now that it has closed Force10 and possesses theinfrastructure technology.

• IBM can outfl ank HP by talking about complete cloud enablement vs. strictly technology. With WebSphere andthe rest of IBM’s $20 billion-plus software business, IBM has the ability to sell not only the infrastructure andorchestration, but the fully integrated software stack, development environment, and services to deploy the entiresolution. Th is is a powerful sales engine in the cloud solutions stack, given the complexity and scale many Global1000 customers seek.

• Oracle needs to shed its image of being overpriced and overly complicated. HP prides itself on ease of use, andthis is a lesson that Oracle could stand to learn, though hubris is not a characteristic from which Oracle suff ers. The reliability of Oracle equipment and the Sun heritage remain valuable, but its expensive, monolithic image ishurting it in the enterprise data center.

• Cisco, Avaya, and Alcatel-Lucent off er more complete converged solutions than HP. Th ese vendors shouldprepare marketing programs for their resellers that emphasize their ‘one-stop shopping’ for voice systemscomplete with security. Th e competing vendors’ perceived internal integration could make it easier for theirpartners to sell both VoIP and security systems.

• Extreme and Enterasys both should focus on their IPv6 leadership, service provider presence, and embeddedsecurity capabilities where appropriate, as each has strengths in their respective areas. Neither can compete withHP on channel scale, but each can focus on their particular strengths and provide diff erentiation through superiorchannel engagement and tailored support.

Recommended End-User/Customer Actions

• Customers that currently buy one facet of HP’s technology should consider the rest of the company for thesynergies on both the business and technology sides that these products would bring. HP’s stable of products canaddress nearly any data center or enterprise infrastructure need, and customers should consider the advantage of

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one-stop shopping. However, it is still important to keep a secondary supplier waiting in the wings, if for no otherreason than to keep the prices from the primary supplier in line with the market.

• Companies that are looking for professional services should take a good look at HP’s services. Its off erings arecomprehensive and it should be able to provide value if hired, or at least a diff erenti ated view point on a givenproject bid. In addition, HP can bring a balanced eye to an outsourcing conversation and assist with a migration ifthe model makes sense.

• Customers looking for networking equipment should get a bid from HP, as its off ering now rivals many. HP’slifetime warranties, competitive pricing, and excellent feature set make it a vendor that corporations shouldconsider for their networking bids.

• Customers within HP’s strong networking verticals (e.g., education, healthcare, public sector, manufacturing, etc.)should view the company’s success within their respective industries as validation of HP’s products and its abilityto support their needs.

References:

http://www.strategicmanagementinsight.com/mission-statements/hp-mission-statement.htmlhttp://www.idealtermpapers.com/sample-papers/the-strategic-management-process-for-hewlett-packard-corporation/file:///C:/Users/bozova/Documents/Sandra/MIO/2nd%20semester/Marketing%20Information%20Systems/HP%20paper/Strategic_Information_Management.pdffile:///C:/Users/bozova/Documents/Sandra/MIO/2nd%20semester/Marketing%20Information%20Systems/HP%20paper/accenturestudy.pdfhttp://www.hp.com/https://www.wikipedia.org/

"Hewlett-Packard to split into two public companies".Reuters. October 6, 2014. Retrieved October 6, 2014."HP regains PC lead over Lenovo | News". PC Pro. 2013-01-14. Retrieved 2013-04-2

"HP to Keep PC Division". October 27, 2011."HP History: HP's Garage". Hewlett Packard. December 6, 2005. Retrieved July 7, 2011.