Case Application Fixing What's Broken: HP's Structural a sales deal while competitors typically only had three Challenge people. That meant HP was slower to cut a deal and lost Best known for its printers Cameras Calculators and com many bids. And the final issue Hurd uncovered of the puters, Hewlett-Packard Company 01.P) has had its share 17,000 people working in corporate sales less than of organizing challenges over the years Carly Fionawho 60 percent of the directly sold to customers. The rest was named CEO of HP in 1999-move that made news were support staff or in management. It was a station headlines because was now one of the first major US that Hurd knew had to be changed if the organization corporations to be headed by a woman-continued the was going to again become an industry leader company's strategy of growing by acquiring businesses Mr. Hurd's first move was to fire underperformers Her most controversial acquisition was the $25 billion pur and eliminate three layers of sales management. Then chase of rival Compaq Computers-a decision that was the he eliminated one sales group entirely and merged those beginning of the end for Fiorina. The combined companies individuals into other sales groups. Now, may sales reps experienced many problem-financial cultural and struc are assigned to only one top customers those customers turalesulting in poor performance. Her differences with always know whom to contact. Top Hexecutive now the company's board of directors over the direction H. say that they can make speedier decisions with the new was going finally led to her firing in early February 2005 sales structure. And salespeople are spending more than By the end of March 2005, Mark Hurd, CEO of NC had 40 percent of their time with customers, as compared to been selected by the board as the new CEO of HP around 30 percent a year earlier A few weeks after arriving at He Hurd began hearing complaints about the company's sales force. At a retreat DISCUSSION QUESTIONS with 25 top corporate customers, several of them told Me Hund they didn't know whom to call at because of the 1. Describe the structural problems HP had company's confusing management layers. He also heard 2. How did Mark Murd decide to address is company's the same complaints inside the organization. The company structural problems? What do you think of his head of corporate technology told Mt. Hurd that it once changes? How do you think the company's customers took her three months to get approval to hire 100 sales spe responded to these changes? How about the com class. Another executive said that his team of 700 les pany's executives and sales force? people typically spent 33 percent to 36 percent of their time 3. Would a more mechanistic or a more organic organi with customers. The rest of the time was spent negotiating zation be appropriate for HP? Why? internal HP bureaucracy. Even the sales reps said that they 4. What role do you think organizational structure didn't get to spend time with customers because they were plays in an organization's efficiency and effective often burdened with administrative tasks Getting a price ness? Explain quote or a sample product to a customer became a time consuming ordeal. It didn't take Hurd long to realize that we wall Street Journal there was a fundamental problem that he had to address 2006 As A Gas Win Dong the war Delving into sales structure, Hurd found 11 lay Drama Sember 12.2001 A es of management between him and customers warrud Takes Festa Fortune August 2005 too many, he decided. And the company's sales structure 24. Barrow and the on-Cary Game was highly inefficient. For instance in Europe, H.P had une 21, 2001 and A Lake four people from different departments working to close Case Application Fixing What's Broken: HP's Structural a sales deal while competitors typically only had three Challenge people. That meant HP was slower to cut a deal and lost Best known for its printers Cameras Calculators and com many bids. And the final issue Hurd uncovered of the puters, Hewlett-Packard Company 01.P) has had its share 17,000 people working in corporate sales less than of organizing challenges over the years Carly Fionawho 60 percent of the directly sold to customers. The rest was named CEO of HP in 1999-move that made news were support staff or in management. It was a station headlines because was now one of the first major US that Hurd knew had to be changed if the organization corporations to be headed by a woman-continued the was going to again become an industry leader company's strategy of growing by acquiring businesses Mr. Hurd's first move was to fire underperformers Her most controversial acquisition was the $25 billion pur and eliminate three layers of sales management. Then chase of rival Compaq Computers-a decision that was the he eliminated one sales group entirely and merged those beginning of the end for Fiorina. The combined companies individuals into other sales groups. Now, may sales reps experienced many problem-financial cultural and struc are assigned to only one top customers those customers turalesulting in poor performance. Her differences with always know whom to contact. Top Hexecutive now the company's board of directors over the direction H. say that they can make speedier decisions with the new was going finally led to her firing in early February 2005 sales structure. And salespeople are spending more than By the end of March 2005, Mark Hurd, CEO of NC had 40 percent of their time with customers, as compared to been selected by the board as the new CEO of HP around 30 percent a year earlier A few weeks after arriving at He Hurd began hearing complaints about the company's sales force. At a retreat DISCUSSION QUESTIONS with 25 top corporate customers, several of them told Me Hund they didn't know whom to call at because of the 1. Describe the structural problems HP had company's confusing management layers. He also heard 2. How did Mark Murd decide to address is company's the same complaints inside the organization. The company structural problems? What do you think of his head of corporate technology told Mt. Hurd that it once changes? How do you think the company's customers took her three months to get approval to hire 100 sales spe responded to these changes? How about the com class. Another executive said that his team of 700 les pany's executives and sales force? people typically spent 33 percent to 36 percent of their time 3. Would a more mechanistic or a more organic organi with customers. The rest of the time was spent negotiating zation be appropriate for HP? Why? internal HP bureaucracy. Even the sales reps said that they 4. What role do you think organizational structure didn't get to spend time with customers because they were plays in an organization's efficiency and effective often burdened with administrative tasks Getting a price ness? Explain quote or a sample product to a customer became a time consuming ordeal. It didn't take Hurd long to realize that we wall Street Journal there was a fundamental problem that he had to address 2006 As A Gas Win Dong the war Delving into sales structure, Hurd found 11 lay Drama Sember 12.2001 A es of management between him and customers warrud Takes Festa Fortune August 2005 too many, he decided. And the company's sales structure 24. Barrow and the on-Cary Game was highly inefficient. For instance in Europe, H.P had une 21, 2001 and A Lake four people from different departments working to close