Читаем Английский язык. Практический курс для решения бизнес-задач полностью

Английский язык. Практический курс для решения бизнес-задач

Other customers have even more serious complaints. For instance, HP has developed customized Web sites for customers where they can place and manage orders. However, these business-to-business sites have frequently cratered – erasing accounts, losing orders, and shipping the wrong products. An HP sales representative complained to his superiors about the disappearance of 70 customers from the B2B systems: «I can’t even evaluate how many relationships… have been burned with this new site.» HP has no comment on the B2B issue.

Patchwork Quilt. Similar problems have hamstrung HP’s efforts to compete with IBM in large corporate computing deals. The technology supporting HP’s corporate-computing sales remains a patchwork of overlapping and poorly fitting systems despite recent efforts at streamlining. HP sales reps spend only 30% to 35% of their working time with customers and partners, compared with 55% to 60% at well-run organizations. «I would stress how difficult it is to do business inside HP,» says Paul Gerrard, HP’s former vice-president. «There are terrible inefficiencies in the system.»

To pull off a big sales deal at HP often requires delicate diplomacy. Putting together a package involving servers, printers, and software, a sales rep has to reach an agreement with each division. If one unit is unwilling to lower its price, the whole deal can fall through. The company lacks an effective process to resolve conflicts. Fiorina helps broker some deals, but she has time only for the biggest accounts.

These problems have fueled calls within HP for hiring a trouble-shooting operations chief. Fiorina is categorically against a COO, saying that a strong CEO should keep a grip on operations. Many analysts rate Fiorina very highly as an inspiring speaker and salesperson, but either lacking the skills or stretched too thin to solve HP’s operations challenges.

If Fiorina continues to struggle, pressure is sure to mount for her to spin off the printing and imaging division. It boosted its sales by 7% in 2004, to $24.2 billion. And it’s a cash geyser, providing 76% of HP’s operating profits, derived from just 30% of total sales. Analysts speculate that freedom from broad corporate management could improve the printer group’s performance. Separating from the printing division could protect HP from its most dangerous long-term threat in the printing business, Dell.

Although it’s unlikely Dell would exit the printer business if HP spun off its printer operation, Dell would have much less incentive to wage price wars, making life easier for the stand-alone HP printing business. And rivals such as IBM and Dell could resell HP’s equipment or license its technology. «If HP separated their businesses today, and the imaging and printing business was its own entity, I would bet we would be partners because they’re a source of technology,» says Tim Peters, VP at Dell.

Going Shopping? HP’s corporate computing businesses could also benefit from standing on their own. Although investors are valuing the nonprinting operations at next to nothing now, these units generated $1.4 billion in operating profit in 2004. Merrill Lynch’s Milunovich figures that the businesses, if they were independent, could be worth $18 billion to $21 billion. Milunovich predicts that without the protection of the cash-cow printing business, managers would respond to acute pressure to revamp its sales, upgrade tech systems, and divest declining businesses.

HP’s services division also needs a lift. With $14 billion in revenues, this group helps corporate customers manage new information systems. Yet HP struggles in services against IBM, whose service division is three times bigger. While more than 60% of HP’s services business comes from low-end customer support and maintenance, some 70% of Big Blue’s service revenues come from business consulting and strategic outsourcing, really high-margin deals. IBM strengthened its high-end consulting services through the $3.5 billion purchase of PricewaterhouseCoopers Consulting in 2002 – a purchase Fiorina rejected at a lower price.

As Fiorina completes a half-decade atop HP, the excitement of the early years has faded. The charismatic and determined CEO who set out to build a titan has now assumed a defensive posture and is working to keep her creation in one piece. For success, she must tackle HP’s stubborn operational glitches. This will require every ounce of her guile, passion, and boldness. But at this point, her choices are stark: The only way to defend the sprawling HP she has built is to fix it. Until she does, the calls for the breakup of a Silicon Valley icon will only grow louder.

Source: Business Week (online), December 13, 2004 (abridged)