HP_and_Compaq_Combined__In_Search_of_Scale_and_Scope

Preparing for the compaq acquisition these lessons

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Unformatted text preview: at does that say when times get tough? We think the high-priced consultant model is a value proposition of the past and will not translate well into the future. Preparing for the Compaq Acquisition These lessons, along with the changing forces acting on the entire technology industry, shaped Fiorina’s perception of what was needed and what was possible for HP. Fiorina said that ever since her arrival at HP, she and the board spent most of their time together considering the strategic choices for the company: We examined strategic choices across a number of different vectors. So that by the time we actually landed on the Compaq acquisition, we had, as a board, examined several different alternatives. I say it that way because some of the companies we considered, which never became publicly known, were along different vectors. Broadly speaking, we examined companies along four different vectors: • • • • Continuation along our current path Services infrastructure Imaging infrastructure Scope- and scale-intensive options We obviously ended up on a scope- and scale-intensive play, but we looked very hard at various alternatives along the lines of status quo-intensive, servicesintensive, and imaging-intensive acquisitions. Included in the imaging intensive vector was spinning out the imaging business, but that certainly wasn’t the only option we looked at. In considering actions along the services-intensive vector, we concluded that making some of the obvious acquisitions in the services-intensive space was buying a backward-looking value proposition and cost model. I have been asked numerous times and have answered publicly that I would not and will not buy EDS believe they have a backward business model, a backward-looking value proposition. It is a backward value proposition in the sense that we don’t think it is any longer about throwing people at technology to make it less complex. We think it is about using technology to make technology less complex. And therefore, we think it’s a huge deal that our managed services business is attached This docum...
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This document was uploaded on 02/16/2014 for the course MGMT 237 at UPenn.

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