Hewlett Packard: SWOT and GAP Analysis
Hewlett Packard (HP) is among the global consumer durable giants. It deals in a very wide spectrum of products meant for the consumers as well as businesses. The company has global brand in a range of IT products including desk-top, laptop, photocopy machine, and enjoys global leadership in printers. In this part of the textan analysis of the company’s internal environment – strengths and weaknesses, and external environment – weaknesses and threats (SWOT) is given.
1.Brand value: The Company has an awesome brand equity commanding a value of $19.3 billion, biggest in the consumer durable segment. It ranks 50th among the top 100 brands in the globe.
2. Sector ranking: HP has marked presence in the IT sector with 10th position. It competes with Apple, Google, and Facebook.
3. Excellence in product: The Company enjoys a clear competitive advantage in terms of product excellence. Every second the company ships 2 personal computers and 2 printers. It is ranked second in terms of volume of PC shipment. The company enjoys 21.5% share in PC market and 40.5% share in global printer market.
4. Product differentiation: Product differentiation is another source of competitive advantage of the company. The company’s innovation foot-print is clearly visible in HP Spectre a fantastic laptop equipment. Performance and durability of the photocopy machine and printer meant for bulk production are also superb in performance and durability.
5. Research and Development: The company spends fabulous amount on research and development in order to stay ahead of rivals in technology implementation. The R&D activities of the company are deeply focused on technological innovation a key growth driver for the company.
6.Marketing:The company spends considerable amount on marketing. The company I known for smart and penetrating ads for its products.
1. Declining demand: HP’s core business, printers, is declining steadily since 2012 by 4.04% per year. This is due prevalence of mobile devices in the era of booming mobile technologies (Poletti, 2018).
2. Declining earnings: Earnings of the company has $2,666 million to $2,526 million from 2016 to 2017 (HP Annual Reports, 2017).
3. Poor after sales service: Quality of desktop and laptop after sales service of the company has drastically declined (Marketing91, 2018).
1. High potential of Hyper-converged infrastructure in cloud marketing:The company is focusing on expansion of integrated system in cloud marketing (Networkworld, 2017).
2. Global growth opportunity of 3D printers: The global 3D printer market is projected to grow at CAGR 30.2% from 2017 to 2022. Thus total market size would increase from US$5.933 billion in 2017 to US$22.200 billion by 2022 (Businesswire, 2017).
3. Projected growth of electronics market: The global electronic market is poised to grow by 2.7% CAGR till 2019, to reach $299 billion (Marketing91, 2018).
1. Declining product line: Growth of PC has declined globally (Marketing91, 2018).
2. New product from Dell: Dell's launch of a new mono laser based MFP will add a new competitive market segment against HP (EE Times, 2018).
3. Competition: The company is facing increasing competition from Apple, Acer, Lenovo, Dell, Toshiba, Lenovo, and Samsung in the PC segment, and from Canon, Lexmark, Epson, Seiko, and Xerox in printer segment ((Marketing91, 2018).
| || Helpful|| Harmful|
| Internal|| Strength|| Weakness|
| External|| Opportunities|| Threat|
Gap analysis refers to the technique of determining steps to be taken for moving from current state to desired future state. It shows what the business is doing today and what the business will do tomorrow.
| Objective|| Current state|| Future state|| Gap identification|| Gap |
| Factors|| Remedial |
| To increase annual revenue || $2,526 million|| $3,000|
| Yes|| $472 million|| Decrease in sales|| Better marketing strategy|
| To earn profit of 8% of sales|| 5% of sales|| 8% of sales|| Yes|| 3% of sales|| Increase in production cost|| Business process re-engineering|