Porter's Five Forces Analysis Of The HP Company

1916 Words 8 Pages
1. Introduction
Hewlett-Packard (HP) Company is a multinational information technology corporation headquartered in Palo Alto, California, USA. HP is one of the most sizably voluminous information technology companies in proximately every country. Bill Hewlett and Dave Packard met at Stanford University in the 1930s. Their prosperity commenced when their former edifier Fred Terman asked them to commence a technology company after their graduation. The inventors’ workshop is the landlady’s garage contiguous to the house. It’s only 12 by 18 feet, but the space was enough for them to invent their inventions. They engendered a diathermy machine (a medical contrivance that engendered heat) which is their first product and many others like PCs, networking
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Porter’s Five Forces Analysis
3.1 Threat of New Entrants: the threat of entrants is Medium – Typically brand loyalty. Consumers always compare prices with different brands like Dell, Toshiba, Acer and Lenovobefore buying. It competes in terms of technology, quality, price, reputation, brand, distribution and other range of products in the market. There are medium capital requirements, low economies of scale in manufacturing. Low investment for independent stores. Profit decreases and that means there is a threat of new entrants.
3.2 Threat of Substitutes:the threat of substitutes is Medium–the computer and printing industry is very competitive plus HP is in an environment where there is also other major companies who are also offering the same service and producing similar products. Personal Computer has been perhaps the most important consumer item of the last few decades, but all manufacturers have been losing market share in the electronics market, particularly to mobile devices such as the Samsung Tab and Apple iPad, which are both able to perform much more than PCs and have come at the cost of desktop and laptop. Consumers then have many options to choose from resulting the level of substitutes not so high and not so
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External Analysis
The research works of Hewlett Packard is done by HP labs, which is commenced in 1966. The principle aim of HP Labs is to undertake the challenges from the society as well the buyers for the next ten years. HP labs are found in seven different components of the world. External Environment of the Hewlett Packard is monitored by the HP Labs utilizing three models such as Portals Five Forces, SWOT and PESTEL Analysis. HP Labs has followed all the three models which is evident in study during 1999 to cull out the Structure and Trends of the ISP Market. These 3 strategic methods provide the better understanding of the external environment in divergent perspectives.
Porter’s Five Forces which mainly fixates on the threats from competition and the external factors which affect the business.
SWOT analysis sublimates the four major aspects which could have been done at the growing stage of an organization which provides a view in ascertaining the position of venture in the market.
PESTEL is utilized to give another view of external environment afore making Joint venture in an incipient country.

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