Hewlett Packard's Level of Organisation

Corporate Level

At the corporate level, HP has to manage and change the operations strategy in handling their production and processes. Corporate level strategy would affect the sales and cost of operations. Hence, the corporate level of HP is important in managing strategies which is crucial to the overall profitability of the company. HP’s original corporate strategy was to increase their market share by increasing the product variety that they offer. However, one of the drawbacks of their strategy was that they increased their product variety without fully considering whether these new introductions are profitable.

Functional Level

The functional level of an organization is the level of the operating divisions and departments. The strategic issues at the functional level are related to functional business processes and value chain. The functional level of HP has different aspects such as research and development (R&D), operations, finance, marketing and manufacturing.

For R&D, they are important because they develop new products for HP, thus they help the product analysis department by providing accurate information about the new products.

Moving to HP’s functional level of marketing, their marketing and product management that managed the portfolios did not have the sophisticated statistics to estimate the impact on variety on inventory-driven costs. Hence, HP has to deal with these challenges to reduce the problem of eroding profits arising from their large portfolio which has resulted in many complexities (such as increase in inventory-driven costs, product design costs etc.)

The operational aspect of HP is in-charge of the overall management of product variety and forecasting using past data. Hence, it is an important aspect of the functional level of organisation because the root of the problems faced by HP arises from the failure