Linked by Terry Shannon on Mon 7th Mar 2005 07:48 UTC
Editorial With HP's high-flying CEO Carly Fiorina departing, the company's woes are well known. But how did a firm with such a storied history and vast assets get headed down the wrong path, and what do they need to do to set their course straight?
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"It's strange why Compaq bought Digital and hence acquired Alpha. If the article is correct and that Compaq didn't spend much on research, why bother with Digital? Seems like lack of planning and foresight to me. "

HP bought DEC, and then HP later merged with Compaq. or something like that. it was an indirect acquisition on the part of Compaq.


No, that wasn't the case.

Compaq purchased Tadem and DEC; the idea was to marry the high end, high value market with the low cost economies of scale which they had in their PC division.

Compaq wanted, sorry, *NEEDED* to diversify their business; the fact remains, the margins were dropping on their PCs, they needed something of high value to boost their profitability - they saw the writing on the wall early enough to know that they could not simply be a 100% PC vendor for ever.

The problem was, however, is that they never had a cohesive strategy to deliver those products, coupled that with the Microsoft fanboy'ist atmosphere within Compaq - which still exists in the HP/Compaq - the aquisition was setup to fail on day one.

In other words, it was less to do with the aquisition, and more to do with the lack of long term stratergy and an unwillingness to purge the company of Microsoft zealots hell bent on derailing any possible alternative to their little 'wintel empire' which they'd built up with in Compaq.