Introduction
Hewlett-Packard is a major consumer and enterprise electronics company which faced significant boardroom drama and a corporate split that weakened the company and led to its fall from the peaks of the technology industry. From April 2010 to November 2012, HP’s market value fell by 80 percent, and eliminated $82 billion in shareholder wealth, with further declines in stock price by 42 percent leading to 2015. This essay will discuss the Hewlett-Packard (HP) case with respect to the responsibility for HP’s shareholder-value destruction, HP’s rationale for splitting itself into two firms, and the likely success of HPE over HP Inc. This essay will then provide recommendations and strategies to HPE from the perspective of a corporate governance consultant. This essay will conclude with general lessons in terms of corporate governance and business ethics than can be drawn from this case.
Responsibility for HP’s shareholder-value destruction
Violation of core XXXXXX XX XXXXX, XXXXXXX, XXXXXXXXX and innovation. For XXXXXXX, when XXXX XXXXXX intelligence XXXX XXX XX XXX XX senior executives, Chair of XXX XXXXX XXXXXXXX XXXX hired an external security firm XX investigate XX’s XXXXX XXXXXXX, XXXXX XXX to XXXXXXX scandal from the use XX impersonation XX illegally XXXXXX phone records of the XXXXXXX’s XXXXXXXXXX XXX XXXXXX, XXXXX XXX XXXXXXXXX by XX director Thomas Perkins as ‘unethical’. XXXX XXX XX XXX XXXXXXXXX XX XXXX XXX Keyworth, XXX XXXXXX of whom XXX XXXXXXXXXXX for the XXXX.
XXXX XXX made worse when XXXXXX adult XXXXX actor Jodie XXXXXX sued new XXX Hurd for XXXXXX harassment, XXXXX forced his XXXXXXXXXXX, XXX CEO Apotheker’s decision to XXXX XXX mobile device industry. XXXXXXXXX also acquired XXX highly XXXXXXXXXX XXXXXXX XXXXXXXX company XXXXXXXX, XXX XXXX a $X billion writedown XXX XX accounting XXXXXX at XXXXXXXX, XXXXX raised XXXXXXX XXXXXXXX XXXXX HP’s due XXXXXXXXX process in acquiring XXXXXXXX. XXX board also XXXXXXXXX Apotheker and Board XXXXX Ray XXXX uncritically, which prevented XXXXXX investigations in the XXXXXX. XXX infighting XXXX this scandal XXXXXXXX XX and XXXXXXXXXX XXX XX XXX split into XX Inc., which XXXXXXX on XXXXXXXX XXXXXXXX, and XXXXXXX XXXXXXX XXXXXXXXXX, which focused XX business XXXXXXXXX and services.
HP’s rationale for XXXXXXXXX XXXXXX into two XXXXX
XX XXXXX into HP Inc. XXX Hewlett XXXXXXX Enterprise in order to focus XXXX specifically XX distinct XXXXXXXXX. XXXXXXXX, HP’s XXXXX XXXXX allow XXX XXXXXXXXXX XXXXXXXX software to XX XXXXX XXXX the drag XXXX XXX poorly performing XXXXXXXX electronics business, and XXX XXXXX XXX to XX XXXXXXXX by a more profitable XXX effective XXXXXXX in XXX XXXXXX. (XXXXXXXX and XXXXX, XXXX) The XXXXX XXXX served to allow XXX XXXXXXXXXX of XXXX XXXXXXXXX to XXXXXXXXX XXXX focused XXXXXXXX strategies XXXXXXX XXXXXXXX between the XXX distinct divisions and XXX need XX synergise XXXXX XXXXXXXX lines. (XXXXXXXX and XXXXX, XXXX) Finally, the split XXXXX allow for an increase in XXXXXXXXXXX value, XX it XXXXX XXXXXXX investor confidence in XXXX entities, and XXXXX allow for both companies to XX more focused on XXXXX respective XXXXXXXX verticals, XXXXXXXXX improving XXXXX XXXXXXXXXXXXX XXX corporate performance.
The likely XXXXXXX of XXX XXXX HP XXX.
HPE XX XXX clear candidate for XXXX-term success after XXX XXXXX XX XX. XXXX is XXX XXXX XXX a XXXXXX XX XXXXXXX. XXXXXXXX, HP Inc’s XXXXXXXX in personal computing XXX equipment XXX XXXXXX XX be commoditised in the near XXXXXX, XXXX limited XXXX for XXXXXXXXXX in new XXXXX XXXX as data XXXXXXXXX, cloud XXXXXXXXX XXX XXXXXXXXXXXX. Secondly, HP Inc. was heavily XXXXXXXX by XXXXXXXXX XXXX XXX XXXX less XXXXXXXXXX XXXXXXXXXX in consumer XXXXXXXXXXX. XXXXXXX, XX Inc was XXXXXX significant XXXXXXXXXX from its printer and XXXXXXXX home XXXXXX XXXXXXXX XX XXX time XX the XXXXX, XXX XXXXX be XXXXXXXX XX transform its XXXXXXXX to XXXX XXXX XXXXX XXXXXXXXXXX XXXX XXXXX party manufacturers in XXXXXXXX XXXXXXX such as China. On XXX other hand, XXX was well positioned XX XXXX advantage XX XXXXXX demand for high-XXXXXXXXXXX enterprise software XXXXXXXX XX large XXXXXXXXX XXXXXXX.
XXXXXXXXXXXXXXX and strategies for HPE XXXX XXX perspective XX a XXXXXXXXX governance XXXXXXXXXX
XXXXXXXX, XXX should XXXXXXX their XXXXXXXX on their core XXXXXX XX XXXXXXXXX, trust XXX XXXXXXX XXX XXXXXXXXXXX. XXX XXXX XXXXXXXXXX XXXXXXX demonstrated how board management XXXXXXX were XXXXXXX of XXXXXXXXX XXX company XXXXX XX XXXXX XXX XXXXXXXXXXXX. (Baer, XXXX) XX's corporate governance issues also XXXX back XX XXXXX XXXXXXX's XXXXXX XX XXX, when Fiorina XXX XXXXXX-XXXXXX growth XXXX data XX support her own XXXXXXXXXXX, and XXX XXXXXXX a dysfunctional board XXXX XXXXXX XXXXXXXXX XXXX their compliance XXXX corporate XXXXXXXXXX measures. (Baer, XXXX) XXX’s management XXXXXX draw XXXXXXX XXXX XXXXX XXXXXXXXXX, XXX XXXXXXXXX a XXXX of conduct XXX senior management, a whistleblowing policy XXX a XXXXX-party XXXXXXX to XXXXXXXXXXX breaches in XXXXXXXXX governance and corporate ethics.
Secondly, HPE should draw lessons from XXXXX XXXXXXXX acquisition to XXXXXXXXX a clear due diligence process. HP XXXXX found significant evidence XXXX Autonomy XXX XXXXXXXX XXX financial performance, XXX had XXX instituted XXXXXX XXXXXXXXXX XX ensure XXXX external auditors such as XXXXXXXX XXX conducted due XXXXXXXXX in XXXXXXXXXX XXX acquisition of Autonomy. (XXXXXXXX, XXXX) HPE XXXXXX XXXX a XXX diligence XXXXXX XXXX clearly looks XXXX XXXXXXXXX issues related XX financial compliance, XXXXXXXXXXXX property rights, responsibilities XX XXXXXXXX entities, and XXXXXXXXXXX of XXX XXXXXXXX XXXXXX, XXXX a third-party XXXXXXX flagging out XXX going concerns or compliance issues. (XXXXXXXX, XXXX)
General XXXXXXX in XXXXXXXXX XXXXXXXXXX XXX business ethics that can XX XXXXX from the case
In conclusion, the HP case XXXXXXXXXXXX XXX importance XX a XXXXXX XXX XXXXXXXXX XXXXXX, an XXXXXXXX ethics watchdog committee, and a policy XXXX emphasises XXXXX XXXXXXXXXX to XXXXXXXXXXXX, XXXXXXXXX and XXX process XXX XXX XXXXXX XXXXXXXXXX. XXX XX XXXX XXXX demonstrates XXXX breaches in XXXXXXXX ethics XXX XXXXX come XXXX XXXXXX XXXXXXXXXX, and are most XXXXXXXX at that XXXXX. Hence, XXXXXXXXX governance policies XXXXXX XXX XXXXXXX the need to XXXXXXXX and XXXXXX XXXXXX XXXXXXXXXX XX XXXXXXXXX.
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XXXX, M. H. (XXXX). Corporate XXXXXXXX XXX Corporate XXXXXXXXXX: What XXX We Learn XXXX Hewlett-Packard's XXXXXXXXXX XXXXXXX?.
Bianco, X. (XXXX). XXX Lie: Spying, Scandal, XXX XXXXXXX Collapse at XXXXXXX Packard. New XXXX, NY, XXX: Public Affairs.
Jennings, X. X. (2013). What HP XXXXXX about ethical XXXXXXX in XXXXXXXXXXX XX XXXXXXXX.Corporate XXXXXXX Review,17(X), 35.
Moodie, X. X. (2006). XXXXXXX-Packard-a classic governance case XXXXX.XXXXXXX Good Companies,58(XX), XXX.
Westfall, X., & XXXXX, X. (2010). XXXXX XXXXX announcements: X test XX market XXXXXXXXXX. XXXXXXXX Academies XXXXXXXXXXXXX XXXXXXXXXX: XXXXXXXXXXX XX the XXXXXXX XX Accounting & Financial Studies (XXXX) (Vol. 15, No. 1, XX. 59-66).
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