Hewlett-Packard Organizational Structure Essay Example

Hewlett-Packard Organizational Structure Paper Hewlett-Packard (HP) is an American multinational information technology corporation headquartered in Palo Alto, California, USA that provides products, technologies, softwares, solutions and services to consumers, small- and medium-sized businesses (SMBs) and large enterprises, including customers in the government, health and education sectors. It specializes in developing and manufacturing computing, data storage, and networking hardware, designing software and delivering services. Major product lines include personal computing devices, enterprise, and industry standard servers, related storage devices, networking products, software and a diverse range of printers, and other imaging products. The company was founded in a one-car garage in Palo Alto by Bill Hewlett and Dave Packard. Currently, HP is the worlds leading PC manufacturer, operating in nearly every country. It specializes in developing and manufacturing computing, data storage, and networking hardware, designing software and delivering services. Major product lines include personal computing devices, enterprise, and industry standard servers, related storage devices, networking products, software and a diverse range of printers, and other imaging products. HP markets its products to households, small- to medium-sized businesses and enterprises directly as well as via online distribution, consumer-electronics and office-supply retailers, software partners and major technology vendors. HP also has strong services and consulting business around its products and partner products. We will write a custom essay sample on Hewlett-Packard Organizational Structure specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Hewlett-Packard Organizational Structure specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Hewlett-Packard Organizational Structure specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Major company events have included the spin-off of part of its business as Agilent Technologies in 1999, its merger with Compaq in 2002, and the acquisition of EDS in 2008, which led to combined revenues of $118. 4 billion in 2008 and a Fortune 500 ranking of 9 in 2009. In November 2009, HP announced the acquisition of 3Com; with the deal closing on April 12, 2010. On April 28, 2010, HP announced the buyout of Palm for $1. 2 billion. On September 2, 2010, won its bidding war for 3PAR with a $33 a share offer ($2. 07 billion) which Dell declined to match. Hewlett-Packard is not affiliated with Packard Motor Car Corporation, founded by James Ward Packard and William Doud Packard . HISTORY Founding Bill Hewlett and Dave Packard graduated in electrical engineering from Stanford University in 1935. The company originated in a garage in nearby Palo Alto during a fellowship they had with a past professor, Frederick Terman at Stanford during the Great Depression. Terman was considered a mentor to them in forming Hewlett-Packard. In 1939, Packard and Hewlett established Hewlett-Packard (HP) in Packards garage with an initial capital investment of US$538. Hewlett and Packard tossed a coin to decide whether the company they founded would be called Hewlett-Packard or Packard-Hewlett. Packard won the coin toss but named their electronics manufacturing enterprise the Hewlett-Packard Company. HP incorporated on August 18, 1947, and went public on November 6, 1957. THE 1960s HP partnered in the 1960s with Sony and the Yokogawa Electric companies in Japan to develop several high-quality products. 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 bought Yokogawa Electrics share of Hewlett-Packard Japan in 1999. THE 1970s HP is identified by Wired magazine as the producer of the worlds first marketed, mass-produced personal computer, the Hewlett-Packard 9100A, introduced in 1968. HP called it a desktop calculator, because, as Bill Hewlett said, If we had called it a computer, it would have been rejected by our customers computer gurus because it didnt look like an IBM. We therefore decided to call it a calculator, and all such nonsense disappeared. An engineering triumph at the time, the logic circuit was produced without any integrated circuits; the assembly of the CPU having been entirely executed in discrete components. With CRT display, magnetic-card storage, and printer, the price was around $5000. The machines keyboard was a cross between that of a scientific calculator and an adding machine. There was no alphabetic keyboard. Steve Wozniak, co-founder of Apple, originally designed the Apple I computer while working at HP and offered it to them under their right of first refusal to his work, but they did not take it up as the company wanted to stay in scientific, business, and industrial markets. THE 1980s On March 3, 1986, HP registered the HP. com domain name, making it the ninth Internet . com domain ever to be registered. In 1987, the Palo Alto garage where Hewlett and Packard started their business was designated as a California State historical landmark. THE 1990s In July 1999, HP appointed Carly Fiorina as CEO, the first female CEO of a company in the Dow Jones Industrial Average. Fiorina served as CEO during the technology industry downturn of the early 2000s. During her tenure, the market value of HP halved and the company incurred heavy job losses. The HP Board of Directors asked Fiorina to step down in 2005, and she resigned on February 9, 2005. THE 2000s On September 3, 2001, HP announced that an agreement had been reached with Compaq to merge the two companies. 20] In May, 2002, after passing a shareholder vote, HP officially merged with Compaq. Prior to this, plans had been in place to consolidate the companies product teams and product lines. [21] In 1998 Compaq had already taken over the Digital Equipment Corporation. That is why HP still offers support for PDP-11, VAX and AlphaServer. The merger occurred after a proxy fight with Bill Hewletts son Walter, who objected to the merger. Compaq itself had bought Tandem Computers in 1997 (which had been started by ex-HP employees), and Digital Equipment Corporation in 1998. Following this strategy, HP became a major player in desktops, laptops, and servers for many different markets. After the merger with Compaq, the new ticker symbol became HPQ, a combination of the two previous symbols, HWP and CPQ, to show the significance of the alliance and also key letters from the two companies Hewlett-Packard and Compaq (the latter company being famous for its Q logo on all of its products. ) THE 2010s On April 28, 2010, Palm, Inc. and Hewlett-Packard announced that HP would be acquiring Palm for $1. billion in cash and debtÃ'Ž In the months leading up to the buyout it was rumored that Palm was going to be purchased by either HTC, Dell, RIM or HP. On August 6, 2010, CEO Mark Hurd resigned amid controversy and CFO Cathie Lesjak assumed the role of interim CEO. On September 30, 2010, Leo Apotheker was named as HPs new CEO and President. On September 22, 2011, Hewlett-Packard Co. named former eBay Inc. Chief Executive Meg Whitman its president and CEO, replacing Leo Apotheker, while Raymond Lane became executive chairman of the company. Flat OrganiZational structure HP has flat organizational structure with few or no levels of intervening management between staff and managers. * They had well-trained workers who were more productive when they are more directly involved in the decision-making process, rather than closely supervised by many layers of management. * This structure is generally possible only in smaller organizations or individual units within larger organizations. When they reach a critical size, organizations can retain a streamlined structure but cannot keep a completely flat manager-to-staff relationship without impacting productivity. Certain financial responsibilities may also require a more conventional structure. Some theorize that flat organizations become more traditionally hierarchical when they begin to be geared towards productivity. * The flat organization model promotes employee involvement through a decentralized decision-making process. By elevating the level of responsibility of baseline employees and eliminating layers of middle management, comments and feedback reach all personnel involved in decisions more quickly. Expected response to customer feedback becomes more rapid. Since the interaction between workers is more frequent, this organizational structure generally depends upon a much more personal relationship between workers and managers. Hence the structure can be more time-consuming to build than a traditional hierarchical model . Divisional structure Divisional structure in HP allowed the organization to coordinate intergroup relationships more effectively than does a functional structure. Product Structure * Each product division contains the functions necessary to that service the specific goods or services it produces. What are the advantages of a product structure? * Increases the division of labor so that the number similar products can be increased (such as a wider variety of appliances like stoves, or ovens) expand into new markets and produce totally new kinds of products (such as when an appliance maker starts to produce computers or ai planes). Market Structure * Market Structure Group functions into divisions that can be responsive to the needs of particular types of customers. Geographic Structure An organization facing the problem of controlling its activities on a national or international level is likely to use a geographic structure and group functions into regional divisions to service customers in different geographic areas. * Each geographic division has access to a full set of the functions it needs to provide its goods and sevices. HP IS Decentralized HP has Decentralized organizational structure in which daily operations and decision-making responsibilities are delegated by top management to middle and lower-level mangers within the organization, allowing top management to focus more on major decisions. For a small business, growth may create the need to decentralize to continue efficient operations. Decentralization offers several advantages, though relinquishing control may be difficult for a business owner accustomed to making all the decisions. Advantages Empowering Employees Employees can be empowered by having more autonomy to make their own decisions, giving them a sense of importance and making them feel as if they have more input in the direction of the organization. It also allows them to make better use of the knowledge and experience they have gained and implement some of their own ideas. Relieving the Burden * Decentralizing takes some of the burden of daily business operations off the business owner. When the owner allows others to perform such tasks as hiring new employees or ordering supplies, this frees her up to spend more time on big-picture items, such as planning for expansion or meeting with important clients. Preparing for Emergencies * A situation may arise where the business owner must be away from the business for an extended period time because of illness or another type of emergency. A decentralized structure provides a better chance that the organization will maintain self-sufficiency because managers and employees are accustomed to working autonomously. More Efficient Decision-Making * A decentralized organization is able to make decisions more quickly than one with a centralized structure. A manager often can make a decision without having to wait for it to go up a chain of command, allowing the organization to react quickly to situations where fast action can mean the difference between gaining and losing a customer. Ease of Expansion For a growing business, decentralization can facilitate the process of expansion. For example, if expansion results in opening a new business unit in a different geographic area, decentralization allows the new unit to operate as an independent entity, meaning it can react more easily to the specific needs of the area, such as deciding to sell products that appeal to the local market. Mutual adjustment The ongoing informal communication among different people and functions that is necessary for an achieve its goals. Mutual adjustment makes an organizations structure work smoothly, and managers must constantly make efforts to promote it and do all they can to facilitate communication and the free flow of information among functions. * Mutual adjustment, for example, prevents the emergence of different orientations that can cause significant communication and decision-making problems between functions and divisions. * An organization has to build into its structure integrating mechanism that facilitate mutual adjustment and make it easy for managers and employees in different functions and divisions to meet and coordinate their activities. Cross Functional Structure A cross-functional team is a group of people with different functional expertise working toward a common goal. It may include people from finance, marketing, operations, and human resources departments. Typically, it includes employees from all levels of an organization. Members may also come from outside an organization (in particular, from suppliers, key customers, or consultants). Cross-functional teams often function as self-directed teams responding to broad, but not specific directives. Decision making within a team may depend on consensus, but often is led by a manager/coach/team leader. Advantages on having this structure The organizational changes have increased transparency for these business functions relative to the company’s strategic roadmap, sharpening the executive team’s focus on customer-facing businesses, further enabling opportunities for synergies across business units, and positioning HP for the opportunities it sees in the market.