Chapter 1. Hewlett-Packard Shifts Gears

It is a truism in business that change is the only constant. And so it has been for Hewlett-Packard. At the dawn of the twenty-first century, Hewlett-Packard stood tall as an icon in the technology world, but an icon that was now encountering rougher waters than it had ever experienced. Competition was heating up, traditional sources of profits were being hammered by lower-cost Asian and American competitors, and in this increasingly brutal environment, HP’s corporate culture was often perceived to be outdated, an impediment to performance.

At Hewlett-Packard, people knew how difficult it was becoming to predict the success of marketing such complex and fast-changing products as consumer electronics. The ...

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