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Contents
Decision
QSPM
Introduction
Strategic management is all about Formulation Implementation & evaluation of strategies So our project will revolve on these critical parameters.
Strategic Management
Strategy Formulation
Input /action stage Matching stage Decision stage
STAGE # 1 INTRODUCTION
Bill Hewlett & Dave Packard graduated in electrical engineering from STANFORD university in 1935. The company originated in garage in nearby Palo Alto,California,USA during a fellowship in 1939 with initial capital investment of us $538 Hewlett Packard company commonly referred as HP American multinational information technology corporation headquartered in Palo Alto , California , USA Nearly in each country hp product lines include 01)personal computing devices 02)enterprise servers 03)related storage devices 04)diverse range of printers & imaging products Hp markets its products to household, small to medium size consumers and enterprise directly as well as via online distribution
SWOT ANALYSIS
Strengths
Brand name Low debt Wide range of innovative products Developing of own hardware and software Web technology used for product awareness & sale
Weaknesses
Lack of in-house management consulting division Intellectual capital is underestimated No aggressive investment in R & D No good people retention policy
Opportunities
Expansion of retailed stores for customer convenience Participation in joint venture Make easy to use product for upcoming retirees Computer and cell phone software & hardware
Threats
Competitors technology & pricing low compatibility with non- HP product
Availability of substitute
Less global coverage than competitor
Weight
Rating
Weighted Score
Brand name
Low debt Wide range of innovative products Developing of own hardware and software
0.14 0.13
0.13 0.11 0.10
4 4
4 4 3
0.56 0.52
0.52 0.44 0.30
Weaknesses Lack of in-house management consulting division Intellectual capital is underestimated No aggressive investment in R & D No good people retention policy 0.10 0.08 0.11 0.10 1 2 2 2 0.10 0.16 0.22 0.20
Total
1.00
3.02
Weight
Rating
Weighted Score
3 3 2 4
Threat Competitors technology & pricing 0.14 0.13 0.10 0.11 4 3 4 2 0.56 0.39 0.40 0.22
Total
1.00
3.16
HP
Rating
DELL
Rating
CANON
Rating
Score
Score
Score
Innovation Management Technology Financial Position Market share Customer loyalty Brand name Pricing Product Quality Compatibility Promotion
Total
0.11 0.08
2 3
0.22 0.24
4 4
0.44 0.32
3 2
0.33 0.16
4 4 3
4 2 4 4
2 3 4
3 4 3 3
3 2 2
2 3 2 2
0.10
0.08
1.00
2
3
0.20
0.24
3.29
3
2
0.30
0.16
3.46
4
4
0.40
0.32
2.88
TOWS MATRIX
Strengths - S
1. Brand name
Weakness W
TOWS MATRIX
2. Low debt 3. Wide range of innovative products 4. Developing of own hardware and software 5. Web technology used for product awareness & sale
1. 2. 3. 4.
Lack of in-house management consulting division Intellectual capital is underestimated No aggressive investment in R & D No good people retention policy
Opportunities O
1. 2. 3. 4. Expansion of retailed stores for customer convenience Participation in joint venture Make easy to use product for upcoming retirees Computer and cell phone software & hardware
SO - strategies
(S1, S3,O1,)
(must open new retail stores throughout the world to take advantage of financial strength) (S4, O3) (develop easy pc and cell phone for old generation)
WO strategies (W1,W5,O2) (develop new HR policy in order to retain human capital by taking advantage or other firm management )
Threats - T
1. 2. 3. 4. Competitors technology & pricing low compatibility with non- HP product Availability of substitute Less global coverage than competitor
(S4, T1)
ST strategies
(developed low price and innovative pc & cell phone than competitors ) (S5,T2) (developed such hardware and software for computer & cell phone which are compatible with other companies software and accessories)
WT strategies (W1,T1) (give attention to management consulting division to have more focus on technology improvements)
Interpretation
Critical Region:
ST
Managerial Decision:
Market development Horizontal Integration
Total Average
+21 +4.2
Total Average
-19 -3.17
Industry Strength (IS) Growth Potential Profit Potential Financial Stability Labor cost
Technological know-how
+5 +5 +4 +3 +4
Total Average
-13 -2.6
Total Average
+21 +4.2
FS
+6
Conservative
Aggressive
X-axis =CA + IS = -2.6+(4.20)
+5 +4 +3
+2
+1 CA -6 -5 -4 -3 -2 -1 -1 -2 -3
= 1.60
IS
+1
+2
+3
+5
+6
-4
-5
Defensive
-6 ES
Competitive
INTERPRETATION
According to the space matrix score HP falls in the AGGRESSIVE quadrant . Their strategies should be one of the following: Vertical and horizontal integration Market penetration Market development Product development Diversification
SEGMENTS
ESS HPS SOFTWARE IPG PSG
REVENUE %
19 17 1.4 29.2 32
PROFIT %
2 20 5 30 42
GROWTH RATE %
11 8 14 8 -10
MARKET SHRE %
0.8 0.1 0.6 0.8 0.7
HPHS
2.2
-14
0.2
HP BCG Matrix
Medium .50
Low 0.0
STARS
A
Question Mark
II D
E
I
DOGS
Medium 0
CASH COWS
III
Low - 20 Relative market share
IV
IE (INTERNAL-EXTERNAL MATRIX)
i HP iv
ii v
iii vi
vii
viii
ix
INTERPRETATION
HP falls in first region of IE matrix and there main focus will be on GROW AND BUILD and they will mainly focus on strategies which are:
Market development Horizontal integration
HP
Quadrant III Quadrant IV
INTERPRETATION
HP has rapid market growth and strong competitive position so it falls in first quadrant and the most suitable strategies for HP are:
Market development Horizontal integration
0.13
0.11 0.10
4
4 2
0.52
0.44 0.20
3
3 3
0.39
0.33 0.30
2 -3 3
3 -2 2
4 3 4 3
3 2 3 2
6.24
5.02
INTERPRETATION
According to the total attractive score of QSPM HP should go for HORIZONTAL INTEGRATION