Hewlett Packard Computer Systems Organisation Argumentative Essay Example

that include repurchases, replacements, and expansions, which typically last between 2 weeks and 1 year. On the other hand, completing an opportunistic project can take between 2 and 3 years.

One issue with the DAML approach is how it is perceived by customers. Both the purchasing and IT community desire to maintain HP as their hardware vendor. The purchasing community aims to control the pricing of hardware vendors, while the IT community wants to retain control over relationships.

The customers' senior executives do not perceive HP brand as a value-added supplier, which is causing an image issue. Furthermore, the customer is frustrated because they have to educate different HP application specialists about each new innovation project opportunity, indicating a poor knowledge transfer issue. In addition, sales representatives do not identify opportunistic projects and do not screen sales opportunities. This leads to difficulties in stimulating sales for undefined needs, resulting in a high repurchase and expansion rate but a low conversion rate.

CSS (Computer Systems Organization) is a division of HP. It is involved in the business of designing and manufacturing computers, peripherals, system/application software, and networking products. In order to meet customer needs, CSS has formed partnerships and utilized acquisition strategies when its internal offerings were either non-existent or required too much time to develop. CSS's RISC technology, a key technical innovation, allowed HP to introduce computers more quickly and establish itself as the leader in price/performance in the market.

As a result of decreased national spending and excess capacity, CSS transformed into a global provider of information appliances and solutions. The core competency of Hap lied in the technological features of their products

and an advantageous price/performance ratio in hardware supply. Moreover, the trust and confidence that IT customers had in HP positioned them as a reliable hardware supplier. Coo's customer base is segmented into three categories: large enterprises, small-medium businesses (SEEM), and individual customers. The largest segment of customers typically allocated a significant portion of their multi-million dollar annual IT budgets to HP. The top 5% of customers in this segment represented more than 40% of Coo's sales, regularly placing daily orders and utilizing over 65% of the sales force's productive time. SEEM customers, on the other hand, budgeted less than $0 Mum for their yearly IT expenses and were served by a combination of sales representatives and channel partners. Lastly, individual customers were exclusively catered to through indirect retail channels.

HP considered the sales volume generated by enterprise customers and deliberated on the similarities and differences among top enterprise customers. They aimed to determine whether to provide a standard product offering, customization, or a combination that would allow them to benefit from cost reductions, stability, and improved profitability. The spending of enterprise customers on IT consists of four opportunities: repurchase, placement, expansion, and innovation projects. The table below provides a summary of the order qualifiers and winners from the customers' perspective.

Both infrastructure and opportunistic opportunities have similarities in the process of winning orders. However, they differ in the approach to achieving this. In infrastructure projects, winning orders necessitate specific capabilities. These opportunities are initiated by customers and assigned budgets are predetermined. On the other hand, opportunistic opportunities are initiated by business unit managers and budgets are evaluated.

Functional blocks, Hap's brand equity, and the purchasing

community's desire to control vendor pricing were obstructing HP's evolution into a value-added supplier. The level of reluctance to involve HP as an advisor was likely to hinder any further migration. The current plan effectively caters to existing customers, allowing HP to leverage its trusted position as a hardware supplier to offer expansion and replacement solutions. However, the plan is inherently restricted to existing customers and is time-consuming when it comes to selling to new customers at the downstream level and moving upstream.

Environmentalism's Capriciousness's "Bookish" $g's" $g's (migration) V.
Alternatives
A. Fix the Current Marketing Plan demonstrates issues with sales processes, organization, and time management. To address these problems, an alternative approach could be the implementation of a transaction processing system (TAPS). TAPS would handle the basic non-value added operations of sales representatives, helping to improve efficiency. It is expected that TAPS will streamline Coo's processes for servicing downstream business and automate a substantial portion of the sales process. Additionally, a Marketing Information System (MIS) has the potential to gather data and identify trends in customer orders.

This data may be used to refine HP's sales approach and identify new sales opportunities through statistical models. This solution will require redefining the position of technical support employees, who may need to interact directly with customers (though not always), and sales representatives, who need to learn how to use marketing data to identify trends. To boost salesmen motivation, a revision of the compensation plan is suggested. Additionally, the TAPS presents an opportunity for HP to demonstrate their capability in building a complete software-based solution for Customer Relationship Management (CRM) to customers.

1. Implement an Information System: A

Transaction Process System (TAPS) should be implemented for the down and mid-stream businesses, focusing on regular contacts with clients who place daily orders or quote requests (mostly enterprise customers). These customers contribute significantly to the cost per order dollar, as they place numerous time-consuming orders every day. The TAPS will consist of an application installed on clients' computers, allowing them to enter all the necessary data regarding their needs (equipment type, required product quantity, desired delivery date, etc.). The process is illustrated graphically in Appendix 1.

The resource plan manager on the customer side can request a quote from HP through a specially built application. This request will be sent directly to a technical support specialist. There are two possible scenarios:
1. If the support specialist determines that the project is standard, they can process the request using the TAPS system, which is centralized.
2. If the support specialist believes more information is needed, they can contact the customer directly to gather additional details. Once the order is complete, the support specialist simply forwards it through the centralized system.
At the end of this process, a sales representative will intervene to propose a price to the customer. They may also make any necessary adjustments to this price.

The TAPS provides the client with the ability to track their request's status within the application, allowing them to directly observe the back office operations involved if a support specialist needs to customize the offer. The application guides the client through HP's internal process flow, providing them with a clear understanding of the value of the work being done. This transparency was not previously as apparent when the sales

representative controlled the request process and concealed HP's internal processes. Figure 1 summarizes how implementing an Information System would enhance Hap's customer relationship management by adding value to sales services.

Customers will be able to see the value-added back-office tasks performed by support employees. Additionally, TAPS will take care of all non-value-added tasks conducted by sales representatives, transferring them to the back office. Alongside TAPS, a Marketing Information System (MIS) can be utilized to collect data from client orders. Previously, sales representatives spent a significant amount of time examining orders to identify sales opportunities. However, with the automated data processing, trends can be detected automatically by analyzing information from numerous orders. If necessary, representatives can verify these trends and confirm actual client needs through direct communication.

Benefits of the information system The calculations from Table A of the case indicate that the TAPS will allow salesmen to save time from tasks that are time-consuming and unproductive (see Appendix 2). By automating the information flow, the TAPS allows sales reps to allocate more time to productive tasks such as building customer relationships and searching for new sales opportunities. It is believed that a significant portion of sales costs are attributed to unproductive time spent by sales reps on order management. With additional time allocated for business development, it is expected that order costs will decrease (assuming a consistent number of orders before and after the TAPS implementation).

The CSS information system may encounter financial uncertainties due to the need for HP to cover implementation costs in order to convince clients to use it. Developing this system on their own presents technical challenges for HP, and they

must also consider the reactions of customers, technical support specialists, and sales representatives. If these individuals reject the system, it could become a sunk cost for HP. Furthermore, the successful implementation heavily relies on HP employees accepting the system. Sales representatives clearly express discomfort with the new system implemented in 1991.

The successful implementation of the IS system will depend on Dais's ability to convince salesmen that it is a solution to their current problems. In addition, salesmen need to be willing to redefine their daily tasks and learn how to effectively use MIS data. The reduction in unproductive tasks will decrease pressure and save time. Salesmen will also have a more complex role with clients. They will need to use MIS data to identify customers' undisclosed issues and determine how HP can collaborate with them to find solutions. As a result, HP will need to develop a new compensation plan that motivates salesmen to promote customer lifetime value.

This plan will consider parameters such as "revenues from newly completed projects with existing customers" that promote customer intimacy development. Technical Sales Support should be prepared to directly contact clients in case of missing information in linen orders or quote requests. Possibly, a support specialist's name could be automatically linked to any customer requests, even if direct contact is not always necessary. The support specialist will need to be trained to handle customer interactions. There is a risk that clients may perceive support specialists as replacing salesmen as the initial point of contact for any request to HP. This should be strongly prevented.

The clients need to be educated on using the application consistently in order

to show them how this behavior will benefit both companies by increasing efficiency in their relationships. Additionally, the new definition of support specialist may necessitate a revised compensation plan for this category. A potential measure of service quality could be the ratio of successfully completed projects requiring their intervention to the total number of projects requiring their intervention. The compensation plan could also incorporate a client survey to assess their perception of the quality of service provided by sales support personnel.

Table 2 presents the benefits and risks associated with implementing a -reps. Table 2: Advantages and Drawbacks of Using a Transaction Processing System B. Altering the Sales Strategy The second option suggests creating specialized teams exclusively for upstream business. These projects are typically initiated by senior executives, such as business unit managers, at client sites. HP will establish a special sales task force that can effectively handle customer relationships at a higher level than those in downstream and midstream businesses. Figure 2 depicts this strategy of entering the market through upstream business.

Experienced salespeople with extensive customer networks will have the task of cultivating enduring and robust relationships. HP must adjust its approach to focus on value content and solution providers, such as Anderson Consulting and Sap, as the IT community is reluctant to control vendor relationships and executive-level individuals are hesitant to involve HP as an advisor, which has hindered migration strategies. These value content and solution providers already possess the desired relationships HP is seeking, and they will also inform their contacts in midstream and downstream businesses about any opportunities within upstream businesses.

The special sales force will operate in a monitoring

mode and will be supported by a centralized unit of consultants with technical expertise in building software-based solutions. Whenever the special sales force detects any signals indicating a potential upstream project, they will contact the consultants. The main goal of this strategy is to penetrate the more profitable upstream business segment, which generates higher revenues during working hours. (CB. Appendix 3). It is possible for an upstream project to also generate some business at the middle and low levels. For example, an innovative project may require additional and faster machines. Figure 2.

Strategy to Attack the Upstream Business: A Portfolio Approach

To approach the upstream business, CSS could utilize a portfolio approach consisting of different semi-standardized solutions. This approach offers several advantages. First, it helps salespeople identify sales opportunities on client sites. Salesmen working on upstream business often struggle to uncover unidentified clients' needs, but the portfolio approach provides a reference in terms of Hap's know-how and capabilities. From the portfolio, semi-standard solutions can be tailored to meet specific client needs.

Furthermore, this approach allows CSS to estimate its costs for the initial stages of upstream projects. By pre-planning solutions, Coo's technical experts have determined certain requirements that can be identified and estimated in terms of costs.

Sales Department Reorganization:
The reorganization of the Sales Department calls for the creation of two new units. Firstly, a specialized sales force consisting of seasoned salesmen who possess exceptional lobbying skills and have the intuition to identify potential opportunities. It is anticipated that Ditz will find these exceptional individuals among the current sales forces.
Secondly, a centralized unit comprising of technical consultants needs to be established. This could prove to

be more challenging. HP must gather highly skilled individuals, capable of working with multiple systems such as SAP and BAN, in order to develop bespoke solutions. It remains uncertain whether CSS can establish such a unit without hiring external personnel or potentially outsourcing aspects of projects, which could incur significant costs for the organization.