Hp Case Essay

2036 Words 9 Pages



The Hewlett Packard Company (HP) was one of Silicon Valley’s legends. HP is diversified into many product lines. Its key competitive advantage is “Technology Innovation”. This case is about the laser printer of HP. HP tried to develop the latest new laser printer, which is network printer and managers from each department had a meeting to discuss about whether using a universal power supply for the next generation of network laser printer called “Rainbow” is beneficial or not.

The major customers of laser printers are in North America and European countries, which use different power supply voltage. The laser
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Financial perspective: If we are not able to keep reseller in stock, customer may go to competitive brand. The cost of stock out will be high and can damage our future sales or ultimate success due to word of mouth and publicity effect. The cost of stock out is varied along the product life cycle; highest cost of stock out in ramp-up stage and considerably lower in end-of-life stage.

Manufacturing perspective: It is a great idea to use universal power supply. We should try to avoid transshipment because the rework for reconfiguration cost is high and we will have a difficulty to get approval from Underwriter’s laboratory regarding the safety standard for reconfiguration process.

Distribution perspective: Using universal power supply will increase shipment from one distribution center to another distribution center. There may be a problem with the decision to shift inventory from one distribution center to another distribution center.


Early 1990’s HP was facing with a high number of demands for Variety of Products as well as a high number of demands for Variability in Production. As result of this, they had been forced to revise their supply chain in order to reduce the lead time, inventory cost and improve customer satisfaction. Their presence on worldwide market determines the company to look for a way to standardize their products with respect the specific of each

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