HP Matrix Structure, Communications, and Global PMO Strategy
This paper examines Hewlett-Packard's organizational design, focusing on its matrix structure that combines regional and product-based divisions. It analyzes how HP balances centralized research and development with decentralized marketing functions, and the communications challenges that arise from this arrangement. The paper reviews HP's use of formal and informal communications mechanisms, including intranets, management blogs, and quarterly all-employee meetings. It also offers recommendations for project management office (PMO) communications skills, addresses cultural dimensions relevant to global project coordination, and evaluates HP's evolving strategy of customer integration and employee empowerment.
- HP's Matrix Organizational Structure: Regional and product-based divisional breakdown at HP
- Centralized Authority and Decentralized Marketing: HP balances centralized R&D with decentralized marketing
- Formal and Informal Communications at HP: HP's evolution between formal and informal communications mechanisms
- PMO Communications Recommendations: Recommended communications skills for HP's project management office
- Global Cultural Dimensions in Project Management: Hofstede's cultural dimensions applied to global PMO coordination
- Customer Integration and Employee Empowerment: HP's single-contact strategy and employee empowerment initiatives
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What makes this paper effective
- Grounds each analytical point in specific, cited evidence from HP's annual reports, internal communications documents, and secondary academic sources, lending credibility to the argument.
- Moves logically from macro-level structure (matrix design, centralization) to micro-level implications (PMO skills, intercultural communication), creating a coherent analytical arc.
- Balances description of existing practices with normative recommendations, demonstrating applied critical thinking rather than mere summary.
Key academic technique demonstrated
The paper effectively uses comparative organizational analysis: it sets up a tension between centralized and decentralized functions, traces how HP has historically navigated that tension (swinging between formal and informal communications), and then applies that tension to practical PMO recommendations. This technique — identifying a structural trade-off and evaluating how an organization manages it — is a core skill in business and management writing.
Structure breakdown
The paper is organized into eight numbered sections that progress from organizational structure (sections 1–2), to communications challenges and mechanisms (sections 3–4), to applied PMO recommendations (section 5), to global cultural considerations (section 6), and finally to strategic and cultural evolution at HP (sections 7–8). This funnel structure moves from broad structural description to specific, actionable analysis, which is well-suited to a business management audience.
HP's Matrix Organizational Structure
Hewlett-Packard operates a matrix organizational structure. The primary means of divisional breakdown is by region. HP has a corporate headquarters along with regional headquarters in Canada, Latin America (Miami), Singapore, Japan, and Switzerland (HP.com, 2011). In addition to geography, HP organizes itself by business unit. EDS and Compaq retain some autonomy from the main HP organization. HP is structured around seven main businesses: Services; Enterprise Storage and Servers; Personal Systems Group; Imaging and Printing Group; Financial Services; Corporate Investments and Services; and Software (HP 2010 Annual Report). This form of departmentalization allows HP to focus on product development and innovation within the functional and product groups, while directing marketing efforts at the international and regional level.
Centralized Authority and Decentralized Marketing
HP retains a relatively centralized system of authority. In particular, the company takes a centralized approach to research and development and corporate strategy functions (Hill & Jones, 2009). This allows HP to develop an integrated suite of products and services. The company often markets different products and services to the same set of corporate and government clients, which highlights the benefit of centralization: HP can tie different products together, providing greater value to consumers while also achieving better results by leveraging existing client relationships and installed technology bases.
The combination of centralized strategy and R&D functions with decentralized marketing functions can, however, create problems. Decentralized marketing units may have little awareness of what the centralized units are doing, and vice versa. This communication gap could lead to sales representatives not fully understanding the products they sell, or to R&D not fully understanding the needs of different market segments.
HP maintains a strategy of open communication in an attempt to reduce the impact of these challenges. The company's managers are encouraged to raise and address issues as they emerge. Tools such as a company intranet, quarterly all-employee meetings, and management blogs are designed to improve the flow of information between departments and geographical units (HP, 2007). This enables two-way communications flow across the organization. While the emphasis in a centralized operation can sometimes stifle innovation or impede communication, HP's use of multiple mechanisms to facilitate dialogue allows the company to address issues quickly and effectively.
Formal and Informal Communications at HP
The company has historically vacillated between formal and informal communications flows. In the 1990s, the informal flow of communications became a liability, as critical information was not always disseminated to the right people in a timely manner (Sieloff, 1999). As a result, HP took steps to formalize its communications. In more recent years, the company has shifted back toward informal communications, employing a variety of mechanisms to support this. An over-reliance on formal knowledge management systems had removed some of the benefits that informal knowledge transmission provides, including speed, efficiency, and candor. HP now attempts to foster a corporate culture that emphasizes communication, seeking to restore the advantages of informal channels while retaining the formal mechanisms that still exist. The organization thus pursues a two-pronged approach to help it overcome potential communications issues.
References
Hill, C. & Jones, G. (2009). Strategic management theory: An integrated approach. Mason, OH: Cengage.
Hofstede, G. (2009). Geert Hofstede cultural dimensions. Geert-Hofstede.com. Retrieved April 23, 2011 from http://www.geert-hofstede.com/
HP 2010 Annual Report. Retrieved April 23, 2011 from
HP. (2007). Communications. Hewlett Packard. Retrieved April 23, 2011 from
HP.com (2011). Retrieved April 23, 2011 from
Illsley, R. (2010). HP's Apotheker forges new road for R&D. Enterprise Innovation. Retrieved April 23, 2011 from
O'Neill, R. (2010). Hewlett-Packard NZ mirrors global structure. ComputerWorld NZ. Retrieved April 23, 2011 from http://computerworld.co.nz/news.nsf/news/hewlett-packard-nz-mirrors-global-structure
Perry, M. & Sanderson, D. (1998). Coordinating joint design work: The role of communication and artifacts. Design Studies, 19(3), 273–288.
Sieloff, C. (1999). If only HP knew what HP knows: The roots of knowledge management at Hewlett-Packard. Journal of Knowledge Management, 3(1), 47–53.
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