Accounting-Pest Analysis-Political

Topics: Mergers and acquisitions, Compaq, Hewlett-Packard Pages: 6 (1709 words) Published: April 24, 2011
PEST Analysis
Political
The international IT and electronics industries have been characterized with intensive competition. Electronics and IT companies are constantly reviewing their achievements as well as the competitors’ in order to come up with better business strategies in an effort to best all other existing industry rivals. With the merger and acquisition strategy between HP and Compaq, members of the IT and electronics industry all over the world were threatened with the intensified effort that could result from the integration. Others were surprised because mergers and acquisition strategies may also result to negative implications on the part of the merging companies particularly when differences in the context of strategies, culture and goals fail to be fully integrated. Economic

For HP and Compaq, the merger will increase the competitiveness of the previously independent companies in order to outdo the achievements of highly aggressive competitors. Both HP and Compaq sought means to add value to their existing products and services in order to increase the level of satisfaction among their clients and customers which were made possible through the merger. Once satisfaction levels among clients and customers are met, HP-Compaq expect better economic competitiveness within the international IT and electronics industry.  Social

The existing companies have been on guard when it comes to new market trends, new market opportunities, new customer bases, and technological infrastructure available for utilization. The merger between HP and Compaq will most likely result to better social activities as sponsored by the merged companies. Social and civic activities that were previously independently supported by HP and Compaq will be carried out in new perspective due mostly to the fact that the merger could expose unexpected factors that could make the new company unstable. Technological

One of the primary reasons for the merger of HP and Compaq are the companies’ drive towards innovation and development in their products and services. The merger enabled relatively stronger research and development efforts for the benefit of the new company since it is now characterized with more intensive concerns to come up with IT products and services that will cater to existing as well as new clients and customers thereby increasing the companies’ consumer bases. At present the electronics products of HP have been observed to undergone evolution with the support facilities which were made available by Compaq. Five Forces Analysis

Suppliers
The merger resulted to review and assessment of the existing suppliers of both HP and Compaq since the integration strategy implied the relatively fewer contracts between companies that provide similar services and raw materials to HP and Compaq. However, the integration likewise resulted to innovation in technology which necessitated new contracts with suppliers that can provide the new services and raw materials needed by HP-Compaq as a single corporation. Buyers

With the promised added value on the products and services of the HP-Compaq merger, clients and customers of the company could expect new and better product lines and service offers as one of the primary objectives of the integration strategy. Buyer power will be intensified in this respect since the HP-Compaq will be offering new electronics products and services in order to set new market trends in the international IT and electronics industry. Competitors

Competitors of HP and Compaq were somehow divided when it comes to the overall implications of the merger to the international IT and electronics industry. There are those who believe that the merger will result to the continuous weakening of both companies compared to their other stronger competitors in the international IT and electronics industries. While some believe otherwise due to the increased capability of HP and Compaq as a single operating company to build...
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