Free Hewlett-Packard's Home Products Division in Europe--1996-2000 Case Study Solution | Assignment Help

Harvard Case - Hewlett-Packard's Home Products Division in Europe--1996-2000

"Hewlett-Packard's Home Products Division in Europe--1996-2000" Harvard business case study is written by David J. Arnold, Carin-Isabel Knoop. It deals with the challenges in the field of General Management. The case study is 17 page(s) long and it was first published on : Nov 21, 2000

At Fern Fort University, we recommend that Hewlett-Packard (HP) adopt a comprehensive strategy focusing on digital transformation, brand management, and strategic partnerships to revitalize its Home Products Division in Europe. This strategy should leverage technology and analytics, data-driven decision making, and customer relationship management to enhance product development, marketing, and customer service. Furthermore, HP should prioritize corporate social responsibility by integrating sustainability practices into its operations and product offerings, fostering a positive brand image and attracting environmentally conscious consumers.

2. Background

The case study focuses on HP's Home Products Division in Europe during the period of 1996-2000. The division faced a decline in market share and profitability due to several factors, including increased competition from low-cost Asian manufacturers, a shift in consumer preferences towards more affordable products, and internal organizational challenges. The case highlights the complexities of navigating a dynamic international business environment, particularly in the face of rapid technological advancements and evolving consumer demands.

The main protagonists in the case are:

  • Michael Capellas: The CEO of HP, who was tasked with turning around the company's performance.
  • Lewis Platt: The former CEO of HP, who had overseen a period of significant growth but also faced criticism for failing to adapt to changing market conditions.
  • The Home Products Division management team: Responsible for developing and implementing strategies to improve the division's performance.

3. Analysis of the Case Study

This case study can be analyzed through the lens of several frameworks:

  • Porter's Five Forces: The case highlights the intense competitive rivalry in the home products market, driven by the entry of low-cost Asian manufacturers. The bargaining power of buyers is also high due to the availability of numerous alternatives.
  • SWOT Analysis: HP's strengths include its strong brand recognition, established distribution channels, and technological expertise. However, the company faces weaknesses in its product pricing, operational efficiency, and marketing strategies. Opportunities lie in leveraging emerging technologies and expanding into new markets, while threats include increasing competition, economic instability, and changing consumer preferences.
  • Balanced Scorecard: HP can utilize the Balanced Scorecard framework to track its performance across key areas, including financial performance, customer satisfaction, internal processes, and innovation and learning. This framework can help HP align its strategies with its overall goals and monitor its progress towards achieving them.

4. Recommendations

To revitalize its Home Products Division in Europe, HP should implement the following recommendations:

1. Digital Transformation:

  • Invest in data analytics and AI: Leverage data to understand consumer preferences, optimize product development, and personalize marketing campaigns.
  • Develop a robust online presence: Enhance the online shopping experience, improve website usability, and integrate social media marketing strategies.
  • Embrace cloud computing and mobile technologies: Offer flexible and scalable solutions to meet evolving customer needs.

2. Brand Management:

  • Reposition the HP brand: Focus on value proposition, innovation, and sustainability to differentiate from competitors.
  • Strengthen brand loyalty: Implement customer relationship management programs to build long-term relationships with customers.
  • Develop a consistent brand message: Ensure all marketing and communication efforts convey a unified brand identity.

3. Strategic Partnerships:

  • Form strategic alliances with technology companies: Collaborate to develop innovative products and services, leveraging each other's strengths.
  • Partner with retailers and distributors: Optimize distribution channels and reach a wider customer base.
  • Engage with NGOs and environmental organizations: Promote sustainability initiatives and build a positive brand image.

4. Corporate Social Responsibility:

  • Integrate sustainability practices into operations: Reduce environmental impact, promote energy efficiency, and implement ethical sourcing practices.
  • Develop eco-friendly products: Offer products that meet the needs of environmentally conscious consumers.
  • Engage in community outreach programs: Support local communities and contribute to social good.

5. Basis of Recommendations

These recommendations align with HP's core competencies in technology, innovation, and brand management. They address the needs of external customers by providing innovative, sustainable, and value-driven products. They also consider competitors by focusing on differentiation through innovation and brand positioning.

The recommendations are supported by quantitative measures such as increased market share, improved profitability, and enhanced customer satisfaction. The assumptions underlying these recommendations include the continued growth of the home products market, the increasing importance of sustainability, and the ongoing adoption of digital technologies.

6. Conclusion

By embracing digital transformation, brand management, strategic partnerships, and corporate social responsibility, HP can revitalize its Home Products Division in Europe and regain its competitive edge. This comprehensive strategy will enable HP to adapt to changing market dynamics, meet evolving customer needs, and build a sustainable and profitable business.

7. Discussion

Alternative approaches to revitalizing the Home Products Division include focusing solely on cost reduction, pursuing a merger or acquisition, or exiting the European market altogether. However, these options carry significant risks. Cost reduction may compromise product quality and innovation, while mergers and acquisitions can be costly and disruptive. Exiting the European market would result in lost revenue and market share.

The recommendations outlined in this case study are based on the assumption that HP is committed to its Home Products Division and is willing to invest in its future. The success of these recommendations depends on the effective implementation of the proposed strategies, the commitment of HP's leadership, and the adaptability of the organization to changing market conditions.

8. Next Steps

To implement these recommendations, HP should:

  • Form a dedicated team: Assemble a cross-functional team to oversee the implementation of the strategy.
  • Develop a detailed implementation plan: Outline specific actions, timelines, and resource requirements.
  • Monitor progress and adjust as needed: Continuously track key performance indicators (KPIs) and make adjustments to the strategy as necessary.
  • Communicate effectively: Keep stakeholders informed about the progress of the revitalization effort.

By following these steps, HP can successfully revitalize its Home Products Division in Europe and achieve long-term success in the dynamic and competitive home products market.

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Case Description

By November 2000, Hewlett-Packard's Home Products Division (HPD) had been selling its Pavilion line of personal computers in Europe for almost five years. During that time, HPD had entered and exited Germany, struggled in France and the United Kingdom, and significantly reorganized its European operations twice. Some at HP felt that the European operation had become what HP should be. Others wondered why it had been so hard and whether the model of "operational excellence" adopted by HPD to compete in Europe was adequate for a very fast-changing market.

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