Many people see technology as the problem behind the so-called digital divide.

Others
see it as the solution. Technology is neither. It must operate in conjunction with
business, economic, political and social system. ~ Carly Florina
A case study of Hewlett-Packard
Company background
Stanford University classmates Bill Hewlett and Dave Packard founded HP in
1939. The HP concept of nonlinear approach to technology and innovative technological
happenstance led to its first product, built in a Palo Alto garage, known as the audio
oscillatoran electronic test instrument used by sound engineers to enhance sound
systems. Subsequently, the technological innovative sound equipment was sold to Walt
Disney Studios. Walt Disney Studios purchased eight oscillators to develop and test an
innovative sound system for the movie Fantasia. HP historical use of TSHs started
during this period (Packard, 1995).
Apart from creating innovative technology hardware, HP has an insatiable
appetite in acquiring horizontal and vertical technological businesses globally (Apollo
Computer, 1989; Sanborn, 1965; Texas Instruments, 1992; VeriFone, 1997 and later sold
it in 2001; and spun-off Agilent Technologies, 1999, StorageApps, Trinagy and Indigo,
2002) (Hoovers Online Hewlett-Packard History, 2008).
With TSHs, HP continued to critically deliver vital innovative technology for
businesses and consumers. Incredibly, the company solutions span into IT
infrastructure, personal computing and access devices, global services, imaging and
printing for consumers, enterprises and small to medium sized businesses. Without any
doubt, HP remains a global technology solutions provider (Hewlett-Packard
Development Company, 2008). HPs over $4 billion USA dollars annual research and
development investment fuels the technological innovative happenstance for nonlinear

innovative new products. And this was the process of using creative destruction
machination to create invention through disrupting the existing technological pathways.
Inexorably, the nonlinear approach compounded with the TSHs adds business value,
create social value and improves the lives of customers. According to the former CEO
Hurd (Hewlett-Packard Development Company, 2010), everything we do must be for
the customer, if its not, we need to reconsider why were doing it (p.1). Presently, the
chief executive officer was Margaret Whitman who took the herms of affairs from Lo
Apotheker and Cathie Lesjak. Cathie Lesjak was the interim chief executive officer from
August to October 2010 when formal CEO Hurd was replaced, terminated, or resigned.
As a result of the organizations innovative technological growth, HP OpenView
operation offers management concepts based upon IT organizational structure, location,
work schedules, and knowledge levels to ensure a flexible solution to the task at hand.
Operations also provide the ability for multiple service team members to work
seamlessly, effortlessly and effectively with clear audit trails, escalation policies and
ownership assignments. Not only does OpenView operational staff managed and led in
the industry, it led applications and important databases (i.e. recent HP Appollo 4200
Gen9Server), and it also managed a broad selection of operating systems which
included;

UNIX,

Microsoft Windows NT,

Novell NetWare,

Legacy systems.

HP Appollo 4200 Gen9Server

The aforementioned coverage gives IT departments the freedom to implement a

variety of systems and not restrict themselves to one management solution. Thus
unleashed cross pollination of creative thinking minds within the company. Operation
was the solution that conformed to the unique business needs due to the virtual and
technological innovative approach adopted by HP (Hewlett-Packard Development
Company, 1994-2003b).
Unsaid, HP robustly continues to expand through acquisitions of horizontal and
vertical businesses. For example in 2002, Hewlett-Packard bought its competitor,
Compaq Computer Corporation, for approximately $19 billion US dollars. The 2002
merger with Compaq Computer Corporation forged a dynamic, powerful team of
140,000 employees with capabilities in 178 countries doing business in more than 40
currencies and more than 10 languages. Revenues for the combined companies were
$72 billion US dollars for the fiscal year that ended October 31, 2002. A merger that
became unsavory in nature and alliance incompatible unfortunately or regrettably. The
Chairman and current CEO Margaret Whitman took the helms of affairs from Cathie
Lesjak and Lo Apotheker. She was the executive leader at HPs corporate headquarters
in Palo Alto, California (Hewlett-Packard Development Company, 2013). HPs executive
team have divided into two divisions, setting the PC unit freebundled with HPs
money-printing printer unit as previously advocated by the former CEO Apotheker.
While Meg Whitman remains the CEO, Dion Weisler, heads the Printing and Personal
Systems after shedding HP of 55, 000 employees. Even with the split of HP into two
divisions, scholastic critics have suggested that the move was still not enough to
rejuvenate HP doldrums and dinosaural technology under constant creativeness and
innovativeness of IBM and APPLE (Gallagher, 2014; Jones, 2014).

Evidently, HP merger with Compaq was a clash of epistemological cultures.

Presciently then, the merger was categorized as a clash of disparate corporate cultures
and that would lead to subsequent morale problems (Hewlett-Packard: History, 2008,
p.10). According to Jones (2014), as perceived through the prism of Scott McNealy,
former Suns ex-CEO, HP and Compaq merger was described as two garbage trucks
colliding(p.1). And it did. A potential bad cosmetic for both parties involved in the deal.
This massive merger involved integrating two very large businesses along with a
required reduction in workforce due to redundant work groups. Apparently, the merger
of HP/Compaq globally could not position HP as a technology giant within the industry.
The implication was that HP could still not have a competitive advantage. HP, however
tried to position itself using important data gleaned from big datasets, smart analytic
sensors reporting and managing technology to have globally competitive advantages
through decentralization of information and authority.
Decentralization of HP
Scott (2003) posits that decentralization of information gave organization
technological edge when information passed through from the peripherals to the
centralized authority. From HP foundation, the company founders used TSHs to insert
the loose coupling (p.284) method into the company operational system (Scott, 2003).
Loose coupling was associated to organizations that have narrow span of control at the
top-level management. Loose coupling allowed each location, office and department to
make relevant decisions that seems fit for the entire organization without specific
permission from the centralized authority. Fulmer (1999) espoused that HP
organizations consisted of 156 business units that ran themselves like individual

companies (Section: The HP Objectives, 2008, 4). According to Nickerson and Zenger
(2002), decentralization with the use of TSHs promoted flexibility and innovation. In
contrast, HP decentralization through capitalistic creative destruction impeded
coordination. For example, the managers within the Novell Netware departments might
duplicate actions already taken by the managers at the Legacy Systems department due
to the decentralization of authority. Duplicity and multiplicity of actions markedly
diminished the amplitudes of managerial contributions.
Evans (1992) contended that decentralization through relationships unglued
technologies that were prevalent in the 1970s and 1980s where information was
centralized. Markedably, during these epochs leadership actions and corporate gleaned
information were glued to a centralized authority. Concordantly, the centralized
authority unglued technological information and innovativeness at a specified pace and
time. Abruptly, the ungluing of HP technology led to earlier centralization with the
organizations. HP core value was lost in the schemes of acquisitions and mergers in the
early 1970s and 1980s-the Hewlett-Packard's HP-Way.
Most significantly, the entrenched core value that was related to HP acuity and
flexibility to respond to market competition with TSHs were lost in the merger. Evans
further ginned up that the lack of flexibility forced Hewlett-Packard to rethink and
reposition the organizational strategy. When HP and IBM joint ventured failed, HP
resulted in rethinking to rethinking as to why the strategy used in the joint venture
failed. Ultimately, the ungluing of this glue technology through decentralization
delineated the essence of understanding the emergence of HP under the mantle of Mark
Hurds-CEO. To learners, what were glue technologies? Glue technologies were referred
to items like HPs constellation of printers and cartridges and units within the

departments that were concomitantly integrated. For example, HPs laptop pricing
indirectly included the cost of its printers. Consumers psychologically believed that they
were getting the printers for free. Even though the ink cartridges eventually cost more
than the printer itself, all integrated. Gratton (1999) offered that HP was depended on
the confidence and respect for employees to affect the desired performance result as
opposed to relying on an elaborate system of rules and regulations to coordinate
performance.
Following the concatenations of historical technological innovation s (TSHs), HP
current position is a derivative from domain of the past-traditionalists think-tank. There
were amplitudes of creative destruction that allowed the entries of innovative newbies.
Ultimately, the underlying fundamental philosophy of HP (Hoovers Online, 2008) was
that the organization should not subscribe to a tightly controlled path of military
(authoritarianism) precision, "but rather to an overall stated and agreed objectives.
Stated objectives were to give people the freedom to work toward goals that determine
best areas of responsibility" (p.148). Gratton (1999) stated that the integration of the HP
way into the culture fostered the type of corporate values that have reinforced desired
behaviors in the organization. Though HP objectives must be clearly stated, the
emphasis authorizes workers to determine how best to implement the goal-setting
strategies in specific areas of responsibilities.
Internally, HP culture accepted change, adapts to innovative ideas, and gave
room for TSHs. These attributes created a disruptive technological situation during the
companys merger with Compaq. For example, Compaq employees initially would not
embraced HP style of management and this was a harbinger for a total business fiasco.
And it was! Compaq employees imperatively were tied to hygienic incentive as

advocated by Fredrick Herzbergs to innovation. Incentives at Compaq were paid

vacation, better salary and better healthcare for employees instead motivational spirit
of creative innovation. Former CEO, of Compaq, Ron Canion, believes people stay
when they fit into the culture and when they were working in a supportive, helpful
environment and were able to receive fulfillment from working as part of a winning
organization (Denton, 1992, Section Power of Culture, 3).
Truly, the core philosophy of Compaq CEO and structure conflicted with HPs
internal culture. And it was tale tail sign of non-capitalistic creative destructiveness of
innovative products. HP internal culture allowed for fluidity with the used of TSHs.
Changes triggered from TSHs continuously led to HPs capacity to be fluid in adjusting
and repositioning strategically new products and services. Above all, the changes
triggered from important data gleaned from big datasets via TSHs helped HP in
resetting new industrial benchmarks during this time (Aluya and Garraway, 2014).
Aside, HPs standards set through TSHs gave the company competitive and comparable
advantages over other competitors. Retrospectively and unfortunately, HP/Compaq had
an assumed competitive dynamism that was completely polar opposite.
Significance of HP internal culture to leadership in organizations
HP did not completely subscribe to technological epistemology that hinders
growth. For learners, the pertinent question was how does HP culture enhanced
leadership styles within an organization? Ferraro (2002) proffered that organization
uniqueness, global mindset and best way of conducting businesses distinguished a
company from its competitors. For instance, team concept and team spirit were initially
vibrant in HP. Schneier and Shaw (1995) explained that many companies embraced and
implemented the concept of using gleaned information from big datasets and TSHs for

teamwork; however, managing team performance measurement, reward systems and

individual team member success was difficult to ascertain. Schneier and Shaw
purported that Hewlett-Packard and now demised Motorola were effective in team
management.
Schneier and Shaw (1995) specifically mentioned that Hewlett-Packard Medical
Products Group's team recognition and reward programs were paralleled to other teams
section in the organization due to timely achievements of team members. HewlettPackard uses team concept in bringing technological innovative products to end-users
and to the market within a short period. Team concepts with TSHs enhanced different
types of leadership styles. Team management from the data analytics, data scientists
and information analytics intangibly contributed substantially to the ephemeral
innovative value to the company. According to Bass and Steidlmeier (1999),
transformational leadership styles could be in consonance to what was practiced in HP.
Schneier and Shaw (1993) contended that one technique that organizations have
been using to enhance flexibility in response to customer demand was called
organizational delayering. Delayering occurred when an organization seeks to flatten its
organizational structure in an effort to (a) accelerate the decision making process, (b)
increase responsiveness to customer service, (c) reduce organizational costs, and (d)
increase the level of accountability throughout the organization. Increasingly, TSHs
accelerated and expedited delayering. After coalescing and analyzing the above four
cardinal points, it conjecturally placed HP above other similar companies during this
time.
Ulrich (1995) introduced the concept of shared service organization, where an
organization designed culture around customer requirements. According to Ulrich, the

customer was and remained the next person in the ultimate value chain. Consequently,
a shared service organization considered customers as partners in a joint venture. Ulrich
indicated that this concept was popular within most management circles; few companies
were able to strategically integrate the concept of customer next to value in such a
successful manner. Obvious contention was that companies like General Electric, Pfizer,
Hewlett-Packard, and Digital Equipment Corporation were among the few who
successfully integrated shared service concept through TSHs from proposal to fruition.
Contentiously, the feeder that feeds the mind of these machines regarding the aforesaid
companies empowering line managers were their responsibilities and accountabilities
for managing employees in responding to setting of customers' initiatives.
Decentralization of authority has now become a part of the line manager's performance
evaluation at these companies. And thus have management unleashed the creative
thinking that moves innovativeness to a new level and a tectonic shift in managerial
logical reasoning. These line managers now have the authority to handle most of those
employee-related issues that were once in the domain of the human resources
department.
During HP creative innovative hymnal days as a leader within the industry, other
organizations imitated and mutated the impalpable HP ways; organizational leaders
were seen implementing the concepts of decentralizations. Evans (1992) stated that
industry leaders such as Shell, IBM, Hewlett-Packard, Matsushita, Ciba Geigy, and
Unilever, were involved in a similar project of decentralization. Also, the foreground
organizations were involved in the incremental implementation of a process called the
differentiated network organization. Ideally, the process in question was based on goals
that were accomplished through relationships. Evans proffered that the process involved

shared vision in which managers understood the need to collaborate and take control.
HPs top executives found it difficult to relinquish hierarchical control through TSHs to
subordinates due to the centralized old system. Thrust forward, executive relinquishing
control was culturally atom to the philosophy of the HP organization. A process based
on the idealness, which prohibited top executives from relinquishing hierarchical
control through TSHs to subordinates. Basically, the assumption anchored on managers
inability to exercise self-controlled coordination that reflected on their ability to
negotiate differences arising from organizations members-people management.
Eventually this euphoria dissipated amongst organizations mutating the HP way
People management
In respect to people management, culture was perceived as supportive, open, and
tolerant of individuals freedom. Most significantly lesson to leadership in organizations
was that HP places a higher premium on teamwork rather than on individual closed
performances. Hence, the emphasis on teams suppressed the incidence of superlative
egotism among HP workers. In continuation, HP simultaneously instilled the
commitment of long-term view by selling the right products to customers as opposed to
selling at any cost and a fulcrum that significantly bided HP products by reducing
overall cost. HP's system of values (i.e. the HP Way) was flexible enough to allow
reinterpretation at every level of the organization throughout the life of the company.
For example, Gratton (1999) pointed out that during the recession of the late 1980s and
early 1990s, when the company was downsizing, senior management reinterpreted the
HP Way to mean jobs for performers and not jobs for life. Literally, on the international
front, the literature noted that HP trained national unit managers to blend into the
national culture and the corporate culture in a seamless and consistent manner.

Epistemologically, the core notion within this said phenomenon was HP capacity to
adjust, adapt, and change to a new paradigm due to historical trends that led to
performance. And this was a belief system of cultural adjustment that became the kernel
for management performance.
Performance management
On the issue of performance management at HP, the organization was holistically
synthesized from human resources policy perspective. Informal settings and
understandings existed within the HP culture. From the human resources policy
perspective, the literature material gleaned from research indicated that attention to
details becomes the catalyst for promotion of individual freedom, innovation, and an
entrepreneurial spirit on the long run. The literature also noted that the HP Company
used detailed and rigorous ways of performance assessment as a means of reinforcing
worker confidence within the culture. Gratton (1999) emphasized that the issue of
human resources was amplitudely integrated at all levels of the corporate planning
process, and that individual performance evaluation methods incorporated employee
self-developmental plans.
Gratton (1999) reiterated that organizations culture may appear to be loose and
flexible, however, the process of output control in planning and performance monitoring
systems were tightly designed to ensure employee met set targets. Implicitly, the
organization controls what individuals were supposed to do, whilst individual controls
how each designated tasks were accomplished. Consequently, the element of choice
becomes a matter of flexibility, goal oriented or imposition.
Scott-Morgan (1994) noted that HP Way was synonymous with the formalized
statement the way we work around here (p.121). Glibly, human resource management

at HP ritually followed the epistemological beliefs and not hubris behaviors. Informal
understandings among workers played a key motivating role in the organization.
According to Scott-Morgan, the personnel department was expected to coordinate
delivery of the necessary administrative and operational resources for each manager to
accomplish set of objectives.
Nicholson (1996) indicated that due to the integrated approach of people
management at various capacities within the organization, the human resource
functionalities were perceived handicapped because of an internal consultant on human
resource matters. Nicholson espoused that the human resources function at HP could
not control people management; managers do. Concomitantly, performance ranking
was tied to the team rather than individual effort (Gratton, 1999). Team efforts have
been historically traced and tied to the traditionists in the field of technology.
Pedagogically, HP encouraged personal self-development and organizational
integration. Gratton (1999) noted that HP made a commitment to sponsor selfdevelopment workshops to enhance the continuous learning process throughout the
organization. As part of the personal development scheme among employees, the
organization developed programs, (a) personal development planning, (b) career
workshops, (c) lifelong learning programs, (d) employability training and relatively open
internal job markets. Gratton contended that integration of career planning systems into
the company seems to be more effective; potential conflicts existed between the personal
self-development initiative and the structural dynamics of the organization. For
instance, at HP, the line managers encouraged individual responsibility for career
progression.

Managers recognized that delayering in the organization with larger spans of

control meant substantially to be bureaucratic and cumbersome. Consequently, the
managers had less time to devote toward the development of employees and were
reluctant to train the junior staff because of the opportunity costs in forgoing other
activities. One negative side effect of delayering was that career management and the
coordination of career expectations became problematic. Before revisiting the divergent
perspectives of the traditionists and the new concept of the technologists, a closer
analysis of HP/Compaq merger could explain these contradictions.
The HP/Compaq merger significance to leadership
In merging HP/Compaq culture, what lessons do leadership learned? What is the
significance of the merger to leadership if succinctly quarried? Mullins (2002)
postulated that employees would have trouble adjusting to merger and acquisition if
they perceived significant cultural differences, and differences that delphically
manifested itself in the amalgamation. HP was fundamentally an engineering firm that
emphasized precision, quality and design, whereas, Compaq was reputably known as a
low-cost leader in the personal computing industry. Shankland (2001) espoused that the
diverging management style was a problem between the two companies and this was a
truism overlooked perilously to the detriment of the merger. Compaq was more focused
on individual performance, whilst HP was more focused on teamwork. Lant (2000)
stated that Compaq used a highly structured case based reasoning method to interface
between customers and sales organization, which helped the company to lower level of
complexity in handling customer service issues. Compaq was used to a developmental
style, less proprietary than HP. HP products were designed to work with third party
hardware.

Lant (2000) honed up that leaders of both companies due to third party
hardware later settled a number of designed and quality assurance issues. Expansively,
Baghai, Coley and White (2000) claimed that like HP, Compaq had similar growth
pattern histories and the 9% decline in sales in 1991 was blamed on the firm's high cost
structure, inadequate forecasting and production planning. High reliance on trade
promotion and an inflexible culture also resulted in high cost.
To rejuvenate the company, there was reduction in operating costs, price
reductions, product developments were expedited, and product line extended to
compete with the IBM PC clones and increased participation abroad. Profoundly
important was the restructure, the company grew to become the leading PC
manufacturer in 1994, with one of the flattest organizational structures in the industry.
On the contrary, the HP way was a contributing liability to the company from reliably
gleaned analytics from big datasets gauged (Aluya and Garraway, 2014). Shankland
(2001) proffered that consensus in the Bay Area was HP Way was used by HP employees
as means to (a) foster complacency, (b) avoid coping with change, and (c) mask weak
managerial performance. HP way could typically be epistemological and rigid belief that
never really melted into the merger and other structures.
External environment considerations and significance to leadership
HP/Compaq externally operated in an open system environment. Scott (2003)
referred to the actions similar to HP/Compaq as the orthogonal open system such as
HPs as the loose coupling (p.284). Ultimately the leadership of HP/Compaq became
decentralized and loosed from a centralized system. During this period, competitors like
the Dell, IBM, Sun Microsystems, and Gateway companies took businesses away from
HP/Compaq. Retrospectively, HP never recovered from this business lost to IBM and

other competitors. Beginning with the issue of layoffs, the merged companies were at
the verge of disengaging workers before the merger conceptually took place anyway.
Ehrenman (2001) findings showed that HP was planning to layoff 6,000 and
Compaq 8,500 workers. Layoff issues apparently were written on the wall before the two
companies merged. Undoubtedly, HP/Compaq merger resulted in the two companies
having complimentary product lines. HP/Compaq showed strength by discarding
unproductive and unprofitable lines of products while keeping the strong
onesStrength, Weaknesses, Opportunities and Threats (SWOT). For example, HPs
Windows NT that investors invested $1.6 billion was losing money and Compaq was
leading production of servers within the industry. Appropriately, the ideal situation was
HP allowing Compaq to hold-on to the mantle in the NT component and to be a leader
in the NT industry and this was a peccadillo for the new merger.
Internal environment considerations
Mutual trust between employees and employers falls within a gray area when
referring to the newly formed company of HP/Compaq. According to Newstrom and
Davis (2002), trust was mutual and required joint-faith-responsibility, actions, and
reactions of the people involved. Subsequently, trust contextually became the
expectation of a positive attribution to HP/Compaq to do the right thing for every
employee.
Obvious integration of HP/Compaq comes with dour displacement of managers,
and the dissipating of traditional anchored cultures. In the past, for example, HPs
culture helped built strong bond between employees, managers and executives. After the
merger, the bond disintegrated, fragmented and somewhat became disoriented.
Emerged was the newly created dispensation fragmented bonds between employees;

however, it was followed by complete deep loyalty. For example, Compaq employees
could not initially trust the HP employees due to cultural differences and a deep
skepticism that dissipated after a while.
HP culture eroded its way of life based upon merging but discovered that cultural
estrangement could be a possible solution. Simply put, the cultural estrangement
referred to the antagonistic beliefs or the anchored culture upon which merger and
acquisitions of horizontal and vertical companies were formed. And how the newly
merged employees blend into the culture of the formed company became relevant.
When referred to Marx Seemans views on multi-faceted concepts, Scott (2003)
indicated that rejection of commonly held values and standards within the companies
could be prevalent during merger and acquisition, especially a magnitude of
HP/Compaq merger. To be explicit, HP/Compaq culture must be integrated, assimilated
and complemented in order to reflect newly formed company-pedagogues within the
context of change, adaptation and new challenges amongst technological innovators.
Retrospectively, the culture was too fragmented and it led to disengagement of the
merged companies.
Job design strategies
Within the context of HP/Compaq merger, a team was formed. When the 900member team was formed to eliminate and integrate the HP/Compaq, a task force was
integrated in the mix. Managers designed jobs to enhance positions by delegating
specific job to subordinates. Burrows (2002) noted that objective job designs were
packaged to fit the functional setup of an organization. Subsequently, employees were
worried about benefits and retention. As long as employees were concordance with the
organizations mission, goals, and the respect of autonomy, the fear of retention did not

arise. Departmentalization was apparent within HP/Compaq. Span of control with TSHs
was part of the job design. Jobs were designed with hierarchical authority in place.
Hewlett-Packards decentralization of jobs gave full authority to the managers or
leaders who make decisions which affected the day-to-day activities and functions of the
overall organization. Important data coalesced from the big dataset via analytic and
TSHs assumably helped leaders in HP to facilitate and effectively disseminate needed
information to the overall organization. For example, HP Research and Development
(R&D) department has experts with specialized skills in the research and development
of new product lines. Even after Apotheker, the former CEO acquired the big data
software company Autonomy, the skills required to move HP forward was not present.
HP later spanned off or sold the personal computer business because the business
became contagious to the HP business culture and the skills to execute and compete
were not present (Gallagher, 2014). These skills were usually driven and embedded
within the four fundamental concepts in the analysis of big data (see figure 12 below).
The four concepts were skills, speed, scope and size (4Ss). Specialized cognitive skilled
people were not empowered to make tough decisions that affected the R & D rather
decisions were made from the central or top hierarchy authorities that led to delaying.
Big data drivers - the 4Ss framework

deft at negotiating

Volume of data
available

Size

deft at
communicating.

Deft at influencing
disparate
personalities towards
goal achievement

Increasing Variety
of sources

Scope

Big Data
Deft leadership

Skill

Speed
implementation

Rapid
instantiation

improve
performance

adaptability

Management
Structure
data
unification

Rapid
Adjustment
change

inefficiencies
Resolve
inadequacies

Objective
function
Duplicitous
nature

Degree of data
independence

reduce userelated risk

To increase business
value scope given
improved margins

Figure 12: The leveraging properties of big data

Source: Aluya and Garrawy, 2014a at Aluyainstitute.com
Similarities of HP/Compaq lesson to leadership
After reviewing the organizational structure of the two companiesHP and
Compaq, study disclosed that there were similarities in some areas. Adduced, the
organizational structures of both companies were relatively flat and decentralized. Both
organizations relied on work teams for developing innovative products and increasing
market share in their respective areas. Both companies used patching, the strategic
process by which corporate executives routinely re-mapped businesses to changing
market opportunities (Eisenhardt and Brown, 1999, 7).
Patching called for quick solutions and the team structures were temporary,
changing the dynamics and product components as various business opportunities
arise. According to Eisenhardt and Brown (1999), patching was used more extensively at
HP than at Compaq; however, both cultures were exposed to the patching concept.

Patching and fixing were applied to existing products that were debugged, fixed up and
restructured before or after releasing products to public.
Similarities in organizational culture
HP/Compaq merger led to the elimination of redundant positions within the
companies. According to Appelbaum, Glose and Klasa (1999), Compaq successfully
downsized its organization by 15% in 1991. The key to Compaq success was due to open
communication with employees. Compaq question and answer section defused
employees tensions with the help of TSHs. For example, Compaq illuminated how
merger would result in staff laid off before actions commence. Implementation of lay-off
pay and benefits along with support for out-placed workers helped employees.
According to Appelbaum et al., Compaq announced the introduction of a whole range
of lower-cost products in eight months after the layoffs (Section: Compaq Computer
downsizing, 2008, 5).
Based on Legares article (1998), HP learnt a valuable lesson during the
companys turbulent attempt to merge the Apollo Company into HP in 1989. Apollo was
an excellent financial fit for the company, however, a misfit from a cultural perspective.
Retrospectively, HP/Compaq was a misfit if properly psychoanalyzed. Apollo leaders
and managers perceived themselves as homogenous and separate from HP and
proceeded along those lines after the integration process. HP learnt that the integration
teams must be co-joined by members from both companies. Both companies could not
remain separate and inaptly the integration of teams short-lived. HP did not effectively
communicate the companys strategy to the Apollo team nor did they plan for the Apollo
leadership team to have positions in the new HP organization.

HPs vagary actions caused interpersonal conflicts and uncertainty to arise

between the leadership teams and the minds of the employees at Apollo. HP learnt a
valuable lesson. Variably, the next merged company must be included in the transition
teams. Strategic plans must be communicated to the employees at all levels through
TSHs. HP human resources department must initiate concrete steps to understand,
work with, and change behavior that might have been heavily influenced by a variety of
feelings and values (Legare, 1998, p.36). In summary, both companies assumably were
cognizance of what were needed to implement future successful mergers.
Integration of HP/Compaq
According to Appelbaum et al (1999) and Fulmer (1999), the three most
significance items for successful integration were (a) a supportive organization culture,
(b) trust from all levels of the organization, and (c) visionary and proactive leaders.
HP/Compaq learnt from the merger antiseptic experiences proactively established a
plan to effectively integrate two cultures. But, it was two different cultures irrespective
of the cloaking of the obvious. Primarily, HP focused on the organizational behavioral
(people strategy) aspect of the new organization; however, there were similarities in
HP/Compaq culture already embedded. Bague (2003) purported that HP saw the
merger as an enormous opportunity to accelerate business growth and drive new
efficiencies and innovation (p. 14). But, the assumptions made HP leadership were
wrong.
From previous concatenation of information, HP developed numerous premerger integration teams worldwide, which involved members from both the HP and
Compaq organizations. Bague (2003) espoused the new HP organization developed
seven new strategies to blend the companys two cultures into one:

Passion for customers;

Trust and respect;

Achievement and contribution;

Teamwork;

Speed and agility;

Meaningful innovation; and

Uncompromising integrity

Not over extrapolating from historical pedagogical inductive experiences, HP

proactively integrated up front systems. HPs integrated up front systems helped in the
process of the merger in avoiding running any dual systems that might intuitively
insinuate the experience of a separate organizational culture. TSHs helped facilitate this
process through capital creative destruction doctrine. Explicably, the leadership teams
comprised of members from both companies. Precipitated were well developed new job
titles, pay structures and talent review processes for the employees of the new HP. New
emblements for the company developed as new symbol for the new organization. With
TSHs, a computer portal was developed so that effective communication was
disseminated about the merger. Information became readily available to employees
throughout the organization. Leadership teams comprised of both HP and Compaq
leaders who communicated the new cultural ideals, roles and responsibilities to each
employee groups.
Teams listened to what the employees suggested and made the necessary
vicissitudes during the merger period. During the pre and post-merger, the Compaq
team employees were able to experience the change from a participative management

style. The management style was based on consensus decision-making atmosphere. In

contrast to the new HP participative management style which was more of a directive
decision making culture. Dynamic changes were triggered due to the use of TSHs.
Leaders, team members and subordinates made decisions spontaneously and quickly in
the organization. Realistically expected the leaders made the decisions due to the
dynamic environment and the internal environment of flextime.
Effect of global prostrated on HPs stream of revenues
To retrospectively redact HPs financial statement in October fourth quarter, the
net revenue for 2010 was $33, 278 million USA dollars with over 310 000 employees
(Hewlett-Packard Development Company, 2013a). In the fourth quarter of 2007 to
2008, revenue in the United States grew 4% on a year-over-year basis to $11.6 billion
USA dollars. Revenue grew 16% in Europe, the Middle East and Africa to $11.2 billion
USA dollars (see figure 13 below). Revenue grew 14% in Asia Pacific to $5.2 billion USA
dollars. When adjusted for the effects of currency, revenue in the Americas grew 3%,
revenue in Europe, the Middle East and Africa grew 5%, and revenue in Asia Pacific
grew 8%. Revenue from outside of the United States in the third quarter was 68% in
totality. However with revenue in the BRIC countries (Brazil, Russia, India and China)
grew 24% over the prior-year period and accounting for 10% of total revenue. Despite
the horizontal acquisition of Electronic Data Systems Corporation, which was completed
in the fourth quarter of 2008, HP decline in revenue in 2009 was due to the global
economic recession.
In 2008-2009, HP revenue grew 8% in the United States to $12.6 billion USA
dollars. Revenue declined 12% in Europe, the Middle East and Africa and 4% in Asia
Pacific to $9.9 billion and $5.0 billion, respectively. When adjusted for the effects of

currency, revenue grew 11% in the Americas while declining 2% in Europe, the Middle
East and Africa while Asia Pacific was flat. Revenue from outside of the United States in
the third quarter accounted for 62% congruently.
In 2008, during the recession, TSHs were used to disseminate pertinent
information to over 310,000 employees. Employees were advised to accept pay
reduction despite moderate profit revenue of $8. 3 million USA dollars. Going into fiscal
year 2009, with clogged legal settlement of the acquisition of EDS, and reduction in
employees payroll, the income for HP increased. Toward the end of 2009 and early
2010, the global economy recession has dissipated. The global economy recovery was
underway. In 2011Q4, 2012Q4 and 2013Q1, net revenues for HP were illustrated in
figure 13 below (Hewlett-Packard Development Company, 2013b).

120
100
80
60
40
20
0
2012
Revenue

2013

2014

Cost of Revenue

Gross profit

Figure 13: HPs redacted stream of Annual Revenues in millions of US dollars

Source: Hewlett-Packard Development Company, 2013b; Aluya and Garraway, 2014

For continuous reading please contact the author at Drjluya@gmail.com.

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