This paper analyzes Hewlett-Packard as a global technology company, examining its organizational history, mission statement, and human resource management challenges. The analysis reveals critical HR issues stemming from leadership instability—including three CEOs in four years and a controversial 27,000-employee layoff in 2012—alongside inconsistent compensation practices across international locations. The paper proposes strategic recommendations for standardizing management practices, prioritizing internal promotions, and establishing equitable wage structures to strengthen employee retention and competitive advantage. These interconnected reforms aim to align HP's stated values of trust, integrity, and employee commitment with actual organizational practice.
Hewlett-Packard Company is a technological company offering products and services worldwide. The company was founded by two electrical engineers, Bill Hewlett and Dave Packard, who began their venture in a garage in Palo Alto, California, in 1939 with just $538. The company was formally incorporated in 1947. HP offers a diverse range of services and products, including software, cell phones, computers, printers, and many others. The company serves individual consumers, small and medium-sized businesses, large enterprises, and customers in the health, education, and government sectors.
Today, HP is a global corporation with operations in more than 170 countries and employs over 350,000 people worldwide. The company is organized into seven segments: Personal Systems, Printing Services, Enterprise Group, Enterprise Services, Software, HP Financial Services, and Corporate Investments. In 2012, Personal Systems and Printing were combined. Each segment offers distinct services and products. HP is considered a giant in the technological world and ranked number seventeen among the twenty most valuable brands globally. The company recognizes that its employees are essential to success, and the HR department is designed to recruit, develop, and retain the best-skilled workers. HP believes this approach provides them with significant competitive advantage.
HP operates on a work-life balance philosophy rather than a single mission statement. Instead, the company emphasizes multiple shared values and corporate objectives that guide its operations:
Shared Values:
Corporate Objectives:
Overall, HP strives to create a pleasant and opportunistic work environment for employees while continuously satisfying customers. However, the gap between these stated values and actual organizational practice presents significant challenges.
While HP's mission appears strong on paper, the company faces substantial human resource challenges. Although HP sets high hiring standards and invests in extensive training, performance-based pay, and comprehensive benefits, its actions have often contradicted its stated values.
In 2012, HP announced a massive layoff of over 27,000 employees to be completed within a two-year period—accounting for approximately 8% of the company's workforce. The purpose was to free up finances for reinvestment in the company. This massive reduction demonstrated a fundamental tension between the company's commitment to employee well-being and its financial priorities. The consequences were particularly severe in certain locations. In 2010, HP opened a facility in Conway, Arkansas, employing around 1,000 people. By July 2013, the company laid off the entire customer service department, which consisted of over 500 employees. Yet only six months after this layoff, HP announced a plan to hire 200 new employees at the same Conway location—new hires rather than rehiring or internally relocating existing workforce members. This pattern suggests poor workforce planning and a disconnect between hiring and retention strategies.
One of HP's most significant challenges has been instability in executive leadership. Since 2010, the company has had three CEOs, with one resigning due to sexual harassment charges. Meg Whitman became the current CEO and initiated company-wide revamping efforts. However, her public communication strategy initially worsened the situation. In a 2012 press conference, Whitman announced that HP had failed to maintain proper oversight of employee and product performance under previous leadership and explicitly stated that "HP screwed up." She acknowledged a serious lack of leadership that must change. These stark announcements caused HP's stock to dive 14 percent, though company profits did not suffer as severely as predicted.
The leadership instability sends a harmful signal to employees and undermines HP's stated commitment to ethical standards and integrity. When senior executives act unethically or fail to provide clear direction, it erodes organizational trust and contradicts the company's public values. Employees question whether the company's claims about trust, respect, and integrity are genuine or merely public relations.
Additional HR challenges stem from inconsistent compensation practices across international locations. HP operates a pay-for-performance plan, but implementation varies significantly by geography. For example, customer service agents in India are paid on a per-call basis with performance bonuses, meaning their earnings depend on call volume. In the United States, the same role is compensated hourly with optional performance-based bonuses. This inconsistency creates inequality among employees doing similar work with similar expectations and undermines the company's stated goal of employee commitment and fair treatment.
To address these interconnected challenges, HP must implement a comprehensive HR strategy that balances global standardization with local flexibility. HP should establish a standard management framework applicable worldwide while allowing customization based on cultural and geographical context. This approach would enable HR to conduct more thorough evaluations during recruitment, ensuring better person-job fit and reducing the likelihood of subsequent layoffs.
Second, before hiring additional employees, HP must reevaluate its existing workforce and departmental structure. Promoting or relocating qualified employees from within would lower the chances of future mass layoffs and demonstrate genuine commitment to employee retention. This approach also preserves institutional knowledge and builds loyalty among the existing workforce.
Third, HP must establish standardized wage policies across all locations. While different countries have different legal requirements and cost-of-living factors, employees performing similar jobs with similar performance expectations should have equitable opportunities to earn similar wages. Standardization would reinforce the company's stated values of trust and respect while improving recruitment and retention.
Finally, HR must play a central role in selecting and developing executive leadership. Leaders must demonstrate through their actions—not merely through statements—that the company values ethical conduct, employee development, and organizational stability. When leadership behavior aligns with stated values, employees respond with greater engagement and productivity, which translates to competitive advantage.
While these recommendations may seem ambitious given HP's recent struggles, incremental positive change over time will benefit the company, its employees, and its customers globally. Leadership and organizational foundation begin with human resources. Employees are the primary source of sustainable competitive advantage. When employees feel valued, respected, and fairly compensated, they create a better work environment and achieve higher production rates.
Recognition and representation must begin with HR and executive leaders. Innovative HR strategies must be championed and consistently implemented by all organizational members, especially management. It is also important to incorporate internal and external knowledge—non-traditional sources often become top competitive advantages in modernized HR departments. Each recommendation addresses a separate organizational challenge, yet they work together: improved leadership strengthens employee trust, internal mobility reduces the need for future layoffs, standardized compensation demonstrates fairness, and all three reinforce the company's stated values.
HP was founded in 1939 in a garage and has grown into one of the world's technological giants. Over its 75-year history, the company has faced numerous challenges, with the most visible and damaging occurring in the past decade. Despite employing nearly 350,000 people globally, HP has struggled to maintain a stable, engaged workforce. The company's core problems stem from leadership failure and misalignment between stated values and actual practices.
For HP to regain its reputation and return to a sustainable growth trajectory, it must prioritize major changes in executive leadership selection and HR department practices. These strategic reforms—standardizing global management practices, prioritizing internal promotion and workforce development, establishing equitable compensation, and ensuring leadership integrity—are essential to restoring employee trust and competitive advantage. By realigning organizational behavior with stated values, HP can rebuild a loyal, productive workforce and secure its position as a technology leader.
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