International Case: To Merge or not

to Merge :That is the question for

HP, Compaq and CEO Florina

Submitted by:-
 Raghu Sharma (A16)
 Rishabh Sharma (A02)
 Sahil Chadda (A21)
 Jitendar Pal Singh (A24)
 Rahul Targotra (A17)
Introduction to HP
Hewlett-Packard Company , commonly referred to
as HP, is an American multinational 
information technology corporation headquartered in 
Palo Alto, California, USA.

The company was founded in a one-car garage in Palo

Alto by Bill Hewlett and Dave Packard, and is now one of
the world's largest information technology companies,
operating in nearly every country.
 HP specializes in developing and manufacturing
computing, data storage, and networking hardware,
designing software and delivering services

 Major product lines include personal computing devices,

enterprise servers, related storage devices, as well as a
diverse range of printers and other imaging products.
Introduction to Compaq

Compaq Computer Corporation is an American 

personal computer company founded in 1982. Once the 
largest supplier of personal computing systems in the
world, Compaq existed as an independent corporation
until 2002, when it was acquired for $25 billion
by Hewlett-Packard
The company was formed by Rod Canion, Jim
Harris and Bill Murto — former Texas
Instruments senior managers. The name "COMPAQ"
was derived from "Compatibility and Quality", as at its
formation Compaq produced some of the first IBM PC
compatible computers
Introduction to the Case

 The High-Tech business is changing rapidly

 Some companies such as Dell and IBM have gained

strong position in market

 Conflict of ideas of CEO and son of founder of HP

 HP’s CEO was in favor of merger with Compaq

 Each company had its own strengths and weaknesses

 There were some overlapping of products and services

 Final decision on merger would be group decision

SWOT HP

Strength
 High in Imaging and Printing Systems
 Strong in UNIX servers
 Excellent reputation of innovation quality

Weakness
• Declining growth in PC market
• Server market
SWOT HP

Opportunity
• Software and services business had growth potential

Threat
• IBM and Dell have both better product customizable
services
SWOT Compaq
Strength
• Stable hardware business and distribution channels
• IT services are renowned

Weakness
• High Inventory

Threat
• Lack of online business facilities
Problems & Solution in the case

Why to merge?

 IBM and Dell was giving high competition

 PC market was going down
 Lack of IT and online business services
Problems faced while merging
 Walter Hewlett was against the merger

 Different organization Cultures

 Fear of taking Risk

Merge or Not

 Cost saving($ 2.5 billion per year)

 Savingof technology would benefit HP and it will rival

IBM in size
Conclusion

 Both HP and Compaq had its pros and cons

 FinallyGroup decision was the only solution to make

both companies stable
Present Day

 Hp and Compaq stand strong before Dell and IBM

 Hp is renowned of its services and quality product

 Compaq is famous for its cheap priced and competitive

laptops
The End