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HP Businesses

HP To Cut 30,000 Jobs 291

Posted by Soulskill
from the enough-pink-slips-to-kill-a-forest dept.
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.
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HP To Cut 30,000 Jobs

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  • wait... what??? (Score:5, Interesting)

    by starblazer (49187) on Friday May 18, 2012 @11:39AM (#40041681) Homepage

    HP still has a R&D division? Has hell frozen over? Is a CEO being intelligent for once??

  • Rigth... (Score:4, Interesting)

    by TheDarkMaster (1292526) on Friday May 18, 2012 @11:51AM (#40041867)
    "...CEO Meg Whitman reportedly wants to use that money instead for new products and for bolstering the sales force."

    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)

    by Matheus (586080) on Friday May 18, 2012 @11:53AM (#40041899) Homepage

    Did it bug anyone else that they kept using H.P. instead of HP?

    Maybe it's just me...

  • by tomhath (637240) on Friday May 18, 2012 @12:08PM (#40042101)
    Carly Fiorina gutted the company and put it into a tailspin. Hurd took over and promised to fix things by gutting the company. Now Whitman has taken over and promised to fix things by gutting the company. I hate to see HP go, at one time it was a great company, but they lost their way under Fiorina and never recovered.
  • by JoeZeppy (715167) on Friday May 18, 2012 @12:13PM (#40042161)
    Facebook is a media company, more like Time/Warner than IBM, except they produce even less. Facebook delivers eyeballs to advertisers, nothing more.
  • by squiggleslash (241428) on Friday May 18, 2012 @12:33PM (#40042429) Homepage Journal

    Moreover, I'd assume stuff made by Indian companies (as in, the products are designed and created there) to be infinitely better quality than stuff made by American companies who outsource.

    I've experienced outsourcing, and had to work with people who are on the end of a telephone in a different country, timezone, and living in a different culture. The issue wasn't that the guys on the other end were especially incompetent (many were, but I've worked in IT long enough to know that 75% of the people who work with you are usually barely able to string a subroutine together), but that the wall between us made development close to impossible. The only project management worth a damn under the circumstances was waterfall, and the downsides to being reliant on formal, comprehensive, specs were all too apparent.

    There's no substitute for people who work together on a project working together. Which is why, ultimately, companies like HP who think that the way to solve temporary financial issues is to get rid of their US operations and become marketing shells for goods "designed" and "manufactured" by themselves only nominally, will eventually go the way of the do-do. With no imagination, and with native operators being more efficient, HP cannot beat companies like Asus and Acer.

  • by toadlife (301863) on Friday May 18, 2012 @12:44PM (#40042579) Journal

    My favorite part of that campaign was when Whitman went on and on about how '30 years ago everything was great in California', forgetting that 30 years ago was during the tail-end of her opponent's first two terms as CA governor.

  • Saddest Part (Score:5, Interesting)

    by Lord of the Fries (132154) on Friday May 18, 2012 @12:51PM (#40042683) Homepage

    "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.

  • by Solandri (704621) on Friday May 18, 2012 @01:25PM (#40043107)

    Well - in Whitman's defense, HP needs to retool itself. If their claim to fame is personal computers, they will be an also-ran within 5 years. They need to retool with services, get in on the cloud-storage/processing game, and start putting out products and services that people are interested in. Otherwise, they can sit in a corner with Gateway and talk about the olden days.

    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)

    by aztracker1 (702135) on Friday May 18, 2012 @01:46PM (#40043433) Homepage
    Well, their laser printers are decent (not the all-in-one inkjets), the Touchpad is/was awesome and webOS is hands down the best tablet OS around today. Unfortunately their management totally sucks and they don't know how to control quality, perception of value, or market their goods.
  • by Anonymous Coward on Friday May 18, 2012 @03:02PM (#40044621)

    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)

    by cant_get_a_good_nick (172131) on Friday May 18, 2012 @04:41PM (#40045831)

    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.

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