HP CASE STUDY
1. The structural problem that HP had was their organizational structure. HP became so large that their tall structure became so deep that information was delayed. The company also had management layers that were inefficient, stating there were 11 layers between him and customers. He found that over half the people in corporate sales did not even sell directly to customers.
2. Mr. Hurd chose to address the issues with his customers and employees with HP aggressively in order to solve the problems. He did this by eliminating the excessive inefficient layers of management, fired many employees, and restructured the rest of the organizational structure. His changes would have eliminated many of the problems that lead to customer complaints that would lead to an increase of customer satisfaction. The company’s executives and sales force may have had mixed feelings about the changes. Most people resist change and I imagine the people who were fired or worked directly with those who were fired would be unhappy with his aggressive restructuring of the company. On the other hand, the individuals who complained about the inefficient company structure would see in increase in their overall morale.
4. As we see from this case study, this is a perfect example of a company continuing to grow and the organizational structure’s span of control growing all the while the CEO was not monitoring how inefficient the structure was becoming because it had grown out of control. As companies grow, it is important to assess its infrastructure frequently to be sure the needs of the company and its customers are met.
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