A place for United Methodists and others to explore and share their ideas, resources, visions, and dreams of or about mission, ministry and worship in the emerging missional way... Hosted by Taylor Burton-Edwards, Director of Worship Resources, GBOD. http://email@example.com
Monday, August 22, 2011
UPDATED October 26, 2011: Learning from the HP TouchPad Fire Sale
I'm thinking there may be lessons to be learned from the HP TouchPad fire sale fiasco a few months back and its HPs announcement at that time that it was likely to be exiting the consumer market almost entirely.
The fire sale itself went badly enough. Yes, HP liquidated their inventory of their soon-to-be-orphaned tablet device in record time. But in the process, the crashes of its own servers and websites and the failures of its call centers to be able to process the traffic of their own fire sale raised real doubts about whether HP could even hold its own in enterprise IT systems.
Well, it turns out the PC business, despite its relatively low margins in the current markets, remains one of the most profitable divisions of HP. It also turns out that costs to spin it off would be rather steep ($1.5 billion was the estimate) with little guarantee that the newly formed company would be successful against the likes of the already resurgent Lenovo and Dell. That, and having a PC division internal to HP meant HP was in a better position to maintain favorable contracts for their supply chain in their enterprise server business (which they intended all along to continue).
Oh, and one more thing-- that "profitable" PC business was losing market share (to Lenovo and Dell!) every passing day that its future seemed grim or undetermined.
Low margins, yes... but solid benefits to the company overall, and threats to the company if it were not decisively maintained.