Made public its intentions of jettisoning its customer hardware division together with scrapping its poorly selling mobile product line so as to concentrate on business services (Dorfler & Heuveline, 2007). According to a variety of analysts, HP’s move seems to have been an original idea an outsourcing powerhouse IBM, continuously bundling the hardware that it no longer owns to its outsourcing deals. This has been considered HP’s ‘appropriate correction’ within the industry, exiting the markets where it could be attaining a hiding and concentrating on the enterprise clients that desire for alternatives to the giant powerhouse, IBM.
In case it technically rids itself off the computer business, it might offer the customers who might be wary of outsourcer, thus pushing its own hardware an impression that it is vendor-agnostic (2007). The company seems to be taking transformative, bold steps in order to drive the creation of long term value of shareholders through a concentration of fewer fronts, thus improving its capability of executing, investing in innovation and driving a higher margin business mix. However, it is clear that actual transformation within the outsourcing industry calls for more than just shifting the dollars from hardware devices to software devices.
Although laying focus on software and other services might not necessarily enhance those sectors in the future, but it enables the company to concentrate on a particular consumer base and fully satisfy their desires within an industry that is less saturated and less competitive; the outsourcing industry (Holly, 2002). However, the move to outsource its business cannot guarantee that the company would not be faced any competition. In fact, stiff competition might be posed by the Indian based companies like Cognizant, Infosys and may others.
In order to fight back, the company possesses a majority stake within MphasiS, the Indian IT service provider and could opt to fully roll it into the outsourcing business (2002). One or two smart acquisitions to bolster its ultimate enterprise services presence has been known to brew, a well executed business and management reorganization, a clear and cohesive marketing plan would definitely draw the company into fulfilling its potential. All these might be said to be HP’s signs of determining its ultimate focus and future identity; IT outsourcing consumers could typically be within multi-year agreements considerable reliance on their
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