HP To Cut 30,000 Jobs 291
Axolotl_Rose writes with news that Hewlett-Packard is preparing to cut around 30,000 jobs, close to 10% of its total workforce. CEO Meg Whitman reportedly wants to use that money instead for new products and for bolstering the sales force. From the NY Times:
"China, which is one of H.P.’s highest growth areas, will probably be spared, as will its research and development efforts. Ms. Whitman, who became H.P.’s chief executive last September, 'is trying to build a new company,' one senior executive said of the job cuts. 'You can count this as a part of that.' The final plan is expected to be announced on Wednesday, when H.P. announces earnings for its second fiscal quarter. Considered a slow-moving giant in the tech industry, H.P. had revenue of $127 billion in fiscal 2011, but net earnings of just $7.1 billion. While it has a leading position in the sales of low-margin personal computers, H.P. has been late or unsuccessful in many recent tech trends like providing cloud computing services for big companies and smartphones and tablet computers."
An article at Forbes suggests HP should instead 'retool' those jobs by recruiting makers and hackers, TED conference speakers, and others who have experience building and inventing things.
wait... what??? (Score:5, Interesting)
HP still has a R&D division? Has hell frozen over? Is a CEO being intelligent for once??
Rigth... (Score:4, Interesting)
I bought a HP netbook, believing that I would have something of quality. Big mistake. I think is not going to help increase the number of sellers, if you only have crappy products for sale.
H.P. (Score:4, Interesting)
Did it bug anyone else that they kept using H.P. instead of HP?
Maybe it's just me...
Bad CEO replaced by bad CEO replaced by bad CEO (Score:5, Interesting)
Re:The 21st century formula for a successful compa (Score:4, Interesting)
Comment removed (Score:4, Interesting)
Comment removed (Score:5, Interesting)
Saddest Part (Score:5, Interesting)
"While it has a leading position in the sales of low-margin personal computers."
How ironic and sad that this is HP's claim to fame now days. There was a time when this was simply so not true. There was a time when you bought HP stuff (and you paid top dollars for you), you knew you could throw it against a wall or drive a car over it and it just kept working. Quality was #1, bar no competition. That was back when the engineers still had a bit of say in what went down there.
Re:The 21st century formula for a successful compa (Score:4, Interesting)
Eh? The old HP which everyone knew and loved (well, mostly) had a claim to fame to PCs, workstations, calculators, printers, scientific instruments, and a host of other fringe but cutting edge stuff. That's what gave them a competitive advantage, respect for their brand name. Y'know, back when they were a leader in the tech industry. Their problems right now are due to "retooling" to become a generic PC repackaging brand. They got exactly what they wanted - they're now leader in a market with probably the thinnest margins in the tech industry, indistinguishable from the likes of Gateway.
If you find yourself constantly chasing the hottest new thing, you are by definition an also-ran. You should be creating the hottest new thing. Like back in the day when businesses would pay a premium for HP workstations, printers and scientific equipment; and geeks would pay a premium for their calculators - because they were considered the best and most advanced. They didn't dominate the inkjet printer business because their sales department did a good job marketing them. They dominated the inkjet printer business because they paid a few geeks to play around with using electrostatic forces to spray ink - they nearly single-handedly invented the inkjet printer market.
Unfortunately they gutted their R&D which was producing their high-profit distinguishing products, in favor of sales to promote their high-revenue generic products. I'm sure the high revenue looks impressive on their sales staff's resume, but if it's on razor-thin profit margins it's not really helping the company. I don't see how shifting their sales from one thing to another is going to help. They need to revive their R&D departments if they want to become an industry leader again and enjoy cushy profit margins.
Re:wait... what??? (Score:5, Interesting)
Re:Maybe not fuck off .... (Score:2, Interesting)
Amazon, Google, and Microsoft have learned this lesson, with Chinese hardware. They're cutting out the middle-men and going right to the source for routing equipment. It's a bee in Cisco's bonnet. Of course they do much of the engineering bit themselves because the Chinese have an ongoing, systemic problem with actual innovation... but they really can manufacture like nobody else.
The big difference here though, is that there's no value in going to India over the US other than cost, and that gap is always closing. Meanwhile, there's considerable downside in having to deal with India when you need sales, customer or technical support. Why HP's made that their business plan, I don't understand. Let India do all the work, collect the markup, and "to hell with what customers want."
Who's surprised that that isn't working?
Re:wait... what??? (Score:4, Interesting)
The 10,000 layoffs will suck for the 10,000, but it spreads well past that. A huge subset of them will need at least temporary unemployment benefits. Their house payments may get iffy, and the market is already precarious. Households will cut back on spending, affection the microeconomies around them. There are tremendous costs to be born now.
This is why I don't like the idea of the MBA US President. Bush #43 was an MBA, and so is Romney. Neither one of them has shown any ability to look at the big picture, at anything larger than the bottom line of a single company, from the point of view of the company. Layoffs for a company are great; they boost your stock price a bit. You pay a relatively small cost, because you've been taught since day 1 on your MBA that you should externalize costs as much as possible, essentially make your costs every one else's responsibility. Every layoff affects others, large layoffs affect a lot of people.