Running head: SWOT ANALYSIS
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Hewlett-Packard Company: SWOT ANALYSIS
(Name)
(Institution’s Name)
SWOT ANALYSIS
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Abstract
Hewlett-Packard, commonly known as HP, is an international information technology
organization based in the United States of America founder early 1939 by two young innovative
engineers Dave Packard and Bill Hewlett. Personal computing, software, enterprise storage,
printing and imaging, and solutions are among HP’s products and services to its customers in
various sectors such health, education, and government. According to Yadong Luo, HP is
globally popular for its products that are undeniably quality and unquestionable tremendous
customer services. In addition, expanded geographical presence, comprehensive growth strategy,
and established operations are its key strengths that have made it the globe’s leading personal
computer manufacturer since 2007 (Luo, 2000). However, it has over time face stiff competition
majorly from a Chinese PC manufacturer- Lenovo; nonetheless, its future IT market position
together with significant acquisition will help it minimize such risks of competition and the rapid
technological advancement in the field. Therefore, with this brief overview this paper will clearly
evaluate the Strengths, Weakness, Opportunities, and Threats for Hewlett-Packard Company.
Key words: Strengths, Weaknesses, Opportunities, and Threats
SWOT analysis
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Why discuss the SWOT of HP in this paper? Influence is the most important and critical
reason for such a study. HP employs approximately 320,000 persons and yields revenues of more
than $112. Therefore, what will be the consequences imposed by the collapse of such a
multibillion company. That would definitely mean rise in unemployment and adverse impacts on
the U.S., and possibly world’s economy; hence the feasibility of such a paper. Table 1
summarizes Strengths, Weaknesses, Opportunities, and Threats of Hewlett-Packard Company.
Table 1: Hewlett-Packard SWOT analysis
SWOT ANALYSIS
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Strengths
Brand reputation
In 2014 research on brand dependence index conducted by UTA Brand Studio ranks HP
as the sixth brand globally. Thus, this depicts how customers associate with the brand, making it
part of their lives, and sharing their values. Furthermore, HP is a key global provider of service
network devices; through availability of HP products in almost all world markets attributes to its
enhanced brand reputation.
Diversified Product and Geographical presence
HP is among World’s IT companies with its products and services spread globally
complemented by its existence in not less than 170 nations. The hardware and software among
the products and services mentioned earlier offered by the organization has attracted more than
billion customers on the six continents where its operations are present. Moreover, serving over
350 government clients in various countries has enhanced the vast product range and
geographical diversity that has seen HP increase its growth opportunities.
Presence in China
Ovidijus Jurevicius’ study points out that China’s economy experience a steady growth of
about 8% per year (Jurevicius, 2013). HP’s strong presence in such an economy with increased
corporate spending has benefited from the company’s investment increase that enabled it expand
and diversify products and services they offer to its Chinese customers. Expansion in China is
strength to the company in case of future market competition.
Weaknesses
Litigation
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Global Data’s 2014 research reveals HP’s involvement in litigation that hinders its established
goodwill and general image of the company to its customers and investors. Some of these cases
include Federal District court case in 2010, 2011 Goldblatt’s consumer class litigation against
HP, among other cases. These cases jeopardize HPs efficient management since some cases
require resignation of its board members. Inefficient management hampers quality coordination
of activities within the company (Global Data, 2014).
Inadequate presence in tablet market
Currently, the technological breakthrough of tablet has contributed to rapid increase
tablet market; this growth is expected to increase over the future years. Nonetheless, HP registers
low tablet products in such lucrative market compared to its competitors; with its current models
in the market HP has not succeeded in providing attractive and striking products to its customers.
Therefore, this factor makes HP more susceptible to adverse impacts of market competition thus
offers a great weakness for the company.
Opportunities
Merges
Hewlett-Packard Company has vast opportunities that it can venture and take advantage.
First, the ideal merger between HP and Compaq is the most significant of its kind; this merger
attributes to the rank of new HP as the leading PC Company globally. In his 2014 book, Tom Ma
explains how the merger was able to hit the forecasted cost savings of $3 billion by earning $3.5
billion on the year the two companies merged. Therefore, more partnerships and merges would
mean increase in Hewlett-Packard cost savings (Ma, 2014).
SWOT ANALYSIS
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Expand services and enterprise solution divisions
Hewlett-Packard offer several services that include infrastructure and cloud security and
project solutions; these are the current businesses that contribute to major portion of the HP’s
profit. Consequently, HP need to focus on expanding these divisions since they promise
affirmative increase in profit margins and improved growth opportunities.
Increasing demand of cloud based services
Cloud computing has continuously gained popularity in the IT market and research has
estimated an annual growth of 22% between 2011 and 2020. HP is currently providing various
services reacting to cloud computing, thus, establishing a great position for the benefits of this
growing lucrative market.
Threats
Competition
Information Technology is a business field with many companies who offer similar
products and services. Hewlett-Packard Company faces competition as a threat to its operations.
These competitors use unfair methods to suppress HP’s vast market share through price-cutting,
mass advertising, and shortened life cycles of products.
Rapid technological changes
Furthermore, provision of hi-tech products and services mean rapid technological
advancements by HP that exposes its business operations to greater risks. Introduction of new
products by new technologies used by HP to adopt to new products’ standards compromises the
existing products making them unmarketable and obsolete. Thus, there is need for HP to study
possible impacts by the evolving technological landscape.
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Growing trend of paperless work
Currently, the world is steadily becoming a paperless-globe by the fact that most nations
are adopting paperless operations in various sectors such as health, education among other.
Hence, HP being a company that manufactures copiers is a victim of the hiking trends of
paperless work through digitization of information.
In conclusion, HP has risen to fame by its strengths that focus on availing its products
and services globally. Despite the fact that it still faces much competition from its competitors,
HP has to reduce its litigation in order to maintain its high-ranking brand image. Therefore, any
company that wishes to achieve its set strategies and objectives basically has to analyze its
Strength, Weakness, Opportunities, and Threats.
SWOT ANALYSIS
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Reference
Global Data. (2014, March 28). Global Data. Retrieved Novemeber 6, 2014, from HewlettPackard Company - Financial and Strategic Analysis Review:
http://callisto.ggsrv.com/imgsrv/FastFetch/UBER1/304290_GDTC40468FSA
Jurevicius, O. (2013, February 16). Strategic management Insight . Retrieved Novemeber 6,
2014, from SWOT analysis of HP: http://www.strategicmanagementinsight.com/swotanalyses/hp-swot-analysis.html
Luo, Y. (2000). How to Enter China: Choices and Lessons. Michigan: University of Michigan
Press.
Ma, T. (2014). Professional Marketing and Advertising Essays and Assignments. California:
Tony Ma.
Studio, U. B. (2014). Brand Rankings. Retrieved November 6, 2014, from Brand Dependence
Index: http://www.rankingthebrands.com/The-Brand-Rankings.aspx?rankingID=344&year=743