Mark Hurd of Hp

Hewlett-Packwad, an $87 billion-a-year company, is known as its high technology to both individual and corporate customers. However, the net income stagnated from 1999 to 2004, remained as 3.5 billon. H-P was facing great difficulties to acquire and retain the corporate customers, which account for 70% of its annual revenue. Affected from consuming over half of the time to deal with administrative tasks for getting a sales quote or a sample product, the salespeople are hindered from understanding or satisfying the customers’ needs. Consequently, lots of deals were lost for the slow processing. Meanwhile, years of acquisitions resulted in clumsy and passive sales force and over 30 different types of software to run internally. This has driven the new chief executive, Mark Hurd to restructure the sale management layers from 11 to 8, reorganize the sales force into PC, printing and corporate-technology business units, and narrow each sales force to deal with less than three accounts.
Simplifying the business units benefit the long term growth of H-P in terms of revenue growth and customer loyalty retention. Business units gain a greater flexibility upon direct controlled 70% of its budgeted costs to achieve marketing-driven plans efficiently. Also, the salesperson can specialize in a particular product area, track rapidly the pending sales deals and customize the product solutions to deliver the superior customer value effectively. On the contrast, product specialization may be limited to satisfy the diverse needs of customers demanding multi-products from H-P, also manpower may be increased and overlapped to serve one customer under these target segments. Besides, the ongoing layoffs and reforming internal structures may discourage the spirits of salesperson. Thus, H-P can motivate the salespeople and retain their loyalty by combining both volume and profitability into their commission, as well as providing intensive training workshops to master their product...