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HP Culture

HP was founded in 1939 and grew to be a multi-national corporation with over $115 billion in revenue. [1] It had an open, relaxed culture that encouraged creativity and empowered employees. [2] However, in the 1990s, increased competition and expansion impacted the culture. When Carly Fiorina became CEO in 1999, she implemented cost-cutting measures like layoffs that differed from HP's original collaborative approach and prioritization of people and values. [3] This "Carly Way" had negative impacts like lower employee morale and performance issues. After stepping down in 2005, HP returned to values similar to its original "HP Way".

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973 views11 pages

HP Culture

HP was founded in 1939 and grew to be a multi-national corporation with over $115 billion in revenue. [1] It had an open, relaxed culture that encouraged creativity and empowered employees. [2] However, in the 1990s, increased competition and expansion impacted the culture. When Carly Fiorina became CEO in 1999, she implemented cost-cutting measures like layoffs that differed from HP's original collaborative approach and prioritization of people and values. [3] This "Carly Way" had negative impacts like lower employee morale and performance issues. After stepping down in 2005, HP returned to values similar to its original "HP Way".

Uploaded by

georgebhilai
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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HP at Cultural Crossroads

Group 7 - Team Members


 

Maneesh Sinha
S Mohanty
R. Raghavan
Vivek Sah
Jackie Kukreja
George Mathew
HP at Cultural Crossroads
Relevance:
 Importance of Organizational Culture in managing
people & performance.

Impact of Organizational Culture during


organization’s change process

Importance of implementation of ‘Change Process’ in


planned manner (without up-rooting the Culture)
HP at Cultural Crossroads
Organizational Culture:
 a system of shared values or characteristics held by
members of an organization that distinguishes from
other organizations.

 Seven primary characteristics capturing Organizational


Culture:
 Innovation & Risk taking
 Attention to detail
 Outcome orientation
 People orientation
 Team orientation
 Aggressiveness
HP at Cultural Crossroads
• Founded in 1939 in a garage with an initial investment
of US $ 538.

The founders……. The garage…… The product …. The logo then

Today:

Multi-national IT corporation with net revenue over US $


115 billion.
HP at cultural Crossroads

The HP Way – HP’s Corporate Objectives


The founders stated (in 1950s !!!)
“..The achievements of an organization are the
results of the combined efforts of each individual
in the organization working towards common
objectives….” Open & relaxed culture, Encouraged creativity
o Profit Servicing all stake holders with integrity and fairness

o Customers Profit sharing programs


o Fields of Interest Employee Empowerment
o Growth
Promoted people within
o People
Perfect job security. Avoided lay off even during difficult period
o Management in 1970’s.
o Citizenship
HP at cultural Crossroads

The HP Way – HP’s Organizational Values


• To have trust and respect for individual
• To focus on a high level of achievement and
contribution
• To conduct business with uncompromising integrity
• To achieve common objectives through teamwork
• ToThe
encourage
HP Way flexibility
– Uniqueand innovation Techniques
Management
• Management by Objectives (MBO)
• Open Door Policy
• Open Communication
• Management by Wandering Around (MBWA)
HP at cultural Crossroads

The turbulent period….1990s’


• Competition increased.
• Operations expanded (83 product divisions at multiple
locations)
• Hewlett retired in 1987, followed by Packard in 1993

Impacted Organizational Culture

Laying off employees

Carly Fiorina was appointed as the CEO in 1999


HP at cultural Crossroads
The Carly Way
 Cost cutting measures (Forced vacation, No salary
hike, pay cuts, laid of f 1700 employees in Jan 2001)
 Sought regular updates from key units
 Forced discipline in sales teams
Linked compensation to improvements in customer
approval ratings
Introduced 360 deg. Appraisal system
Bonus based on HP’s performance vs. competitors’
performance Result : Financial
 Implemented merger with Compaq Performance dipped in
2001
Laid off 4700 employees in April 2001
HP at cultural Crossroads HP – Compaq Merger : A Cultural mis-
fit ??
HP at cultural Crossroads

The HP Way The Carly Way


Collaborative Star approach
approach / Team work
Performance, People, Performance first…
Values ….all are everything else later
important equally
No emotional
Egalitarian culture
attachment
Employees are not
expendable
Hire & fire policy
HP at cultural Crossroads

Impacts of Carly Way


Lower Employee morale

Negative impact on company’s performance

Fearful & uncertain working environment

Shift in compensation policy


Carly stepped down in 2005.
HP continues its journey…..without Carly.
The present corporate values are almost same as those followed earlier.

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