Hewlett Packard has faced declining revenue and market share in recent years due to low presence in the growing mobile device industry dominated by Apple and Samsung. The company split into HP Inc. and Hewlett Packard Enterprise in 2014 in an attempt to increase focus and efficiency. However, HP still struggled with low market share in mobile as the document analysis their problem of declining PC sales and rise of tablets. It concludes that for HP to succeed, it must enter new growing markets like 3D printing that leverage its strengths in areas like imaging and engineering.

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Hewlett Packard
A 3 Dimensional Venture
Megan Olsen
BA 301 Final Term Paper
Section 004
2 June 2016

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Table of Contents
Executive Summary……………………………………………………………….. 3
Situation Analysis…………………………………………………………………. 4
Problem Analysis & Description…………………………………………………... 7
Solutions, Evaluation & Recommendation………………………………………… 13
Implementation Plan……………………………………………………………….. 21
Success Metrics……………………………………………………………………. 24
Bibliography…………...……………………………………………………………27
Appendix….……………………………………………………………………….. 29

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ExecutiveSummary
The growth in the mobile industry has proven to be a tough time for Hewlett Packard.
Once a technology driven company; HP now suffers due to a lack of advancement in the mobile
industry. The company’s revenue began decreasing in 2011 which showed the underlying
problem with HP’s extremely low market share in the mobile industry (“Hewlett Packard:
Statistics” 1). With companies such as Apple and Samsung taking over the growing industry, HP
had a difficult time competing and in 2014 the company split in order to become independent
and to better focus on individual markets (Whitman 4). Even with the split, HP could not gain
market share in the mobile industry. The solutions to the issue of low market share involved
pairing with a different company, allocating resources to HP’s mobile devices and completely
changing markets into the 3D printing industry. It was concluded that pairing with a different
company would still not raise market share high enough to be profitable, and allocating resources
to HP’s devices would not be enough to compete with Apple and Samsung. Completely
switching markets and moving into the 3D printing industry would give HP a new start to be able
to lead in an up and coming industry. The 3D printing industry is projected to grow by 13.9% in
2016 and will continue to grow over the next 5 years as development continues (“3D Printing”
1). Due to growth, HP’s immersive computer (Sprout), and the company’s vision to invent and
reinvent new technologies, this move to 3D printing is the best solution for HP (“HP History” 1).
Though the move would be large and affect most, if not all departments in the newly split HP
Inc., the solution would be successful in regards to profit and a benefit to the medical and
aerospace fields (Sedgwick 1). The solution would take 5 years to penetrate into the 3D market
then continue with research and development of 3D printing/scanning technologies. 3D printing
would allow for HP to establish itself as once again a technology driven company.

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Situation Analysis
Hewlett Packard was started by Stanford graduates Bill Hewlett and Dave Packard in a small
garage in Silicon Valley. The start-up began in 1939 and eventually grew to be one of the largest
printing and computer companies in the world. The company quickly became known for its
innovation and became incorporated on August 18, 1947 (“HP History” 1). As the company
continued to grow it became public, and on November 6th, 1957 it started selling shares for $16
US. Over the years the stock has fluctuated from $10 to over $100 but is now worth $12.12 (“HP
Inc.” HPQ 1). After going public the company moved into global markets and in 1961 entered
the medical industry. HP holds a large patent portfolio including many medical instruments as
well as computer parts and mechanisms. HP continued to go global as it entered China in 1981
and began to outsource. In 2002 HP introduced Indigo N.V which allowed for a new type of
printing. The company also acquired a new electronic data system in 2008, pushing it further into
electronics. Even with great innovations the company was not without legal issues. These issues
included the 2012 Autonomy Corp. accounting misrepresentation, worth $8.8 billion, and the
Mark Hurd sexual harassment case the previous year (De La Merced, Hardy 1). The company
recovered and continued to create new products for the technological era. The rise in electronic
markets created a gap between segments of the company, so in 2014 HP decided to split into
Hewlett Packard Enterprise and HP Inc. (“HP History” 1). Hewlett Packard has always held
strength with innovation and technological growth. The company’s vision statement reflects
those strengths while showing its drive to create imaginative products for everyone.
“Our vision is to create technology that makes life better for everyone… every community
around the globe. This motivates us… To make what we make. To invent, and to reinvent. To
engineer experiences that amaze. We won’t stop pushing ahead, because you won’t stop pushing
ahead. You’re reinventing how you work. How you play. How you live. With our technology,
you’ll reinvent your world” (“HP History” 1).

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The company shows promise to innovate and help its customers while changing technology for
the better. HP fully includes all stakeholders in its vision. Though there are many stakeholders,
the primary stakeholders include customers, partners, stockholders and employees. Secondary
stakeholders however, though they still have stake, are less affected by company decisions, these
stakeholders are the community and the environment.
The business strategy for HP relies heavily on splitting the company into two working parts. This
allows for greater speed and agility in the fast growing technological market. According to the
2014 annual report, the company’s strategy for its core business of laptops and printers is to
“deliver superior products, high-value technology support services and differentiated integrated
solutions that combine our infrastructure, software and services capabilities” (Whitman 13).
Even though HPs strategy reflects its business goals it does not exclude its values. The new HP
Inc. and Hewlett Packard Enterprises are all about sustainability. The companies’ website
included a sustainability strategy that the company lives by. The company created solutions that
allow it to “strengthen our communities; minimize the environmental footprint of our customers,
operations, and supply chain; and act with integrity and respect for human rights around the
world” showing the companies values its customers, employees and the environment
(“Sustainability Strategy” 1). Though HP was once a growing company, the increasing
technology in the market creates vast amounts of competition. The company’s sales per year
continue to be in the high but are slowly decreasing each year (“HP Inc.” HPQ 1).
HP has been one of the top
companies in its field for many
years, but with a rise in technological companies their sales are slowly decreasing. According to
database IBIS world, HPs large increase in competition, in this and other industries, contributed

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to the fall in revenue for all segments of the firm ("Computer Manufacturing." 1-3). The figures
below represent the revenue for HP and its competitors Dell, International Business Machines
Corp. (IBM) and Apple from 2010 to present day. The decrease in revenue for HP, Dell and IBM
compared to Apple provides insight into industry problems. The following table shows revenue
for each firm stated in millions of dollars US. ("Online." 2).
Year 2010-11 2011-12 2012-13. 2013-14 2014-15 2015-16
HP Revenue 2579.4 2889.9 2581.1 2577.1 2353.3 2287.2
Dell Rev 2025.5 1855.7 2220.7 2164.1 2092.8 2048.2
IBM Corp. 1529.5 1701.1 1587.6 1503.2 1152.5 1143.6
Apple Rev 995.7 1652.4 2400.0 2940.5 3261.7 3889.5
According to the company profile for HP Inc., HP is the largest operator in its market however,
the personal printing market is decreasing (“HP Inc.” 4). One of the largest industries HP is
involved with is computer manufacturing. The pie chart reveals
market share for each company in the market (“Computer
Manufacturing” 1). Though the market is fairly large it continues to
decrease. This decrease is due to the rise in superior technologies
such as tablet computers. Apple currently rules the tablet computer market with its product
“IPad” holding a majority of market share. HP not only competes in the computer manufacturing
industry but must also compete for share in these new markets. The decrease in the market is a
large threat to HP, without competing in other markets, the company’s revenue could continue to
fall. The company’s strengths in research and development show promise for the opportunities
HP Inc. holds. New developments in 3D printing allow for HP to grow into an undeveloped
market. The threat of losing its market with changes in technology is a large challenge the
company will face. A SWOT analysis was created to show possible opportunities to grow and
threats to consider for HP Inc. as shown on page 7 (“HP Inc.” 4).
Environmental Factors

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The computer
manufacturing industry is in
a highly changing market
and requires new
innovations to compete.
The decrease in the current market for personal and printing systems show technological change
for the future. A report on computer manufacturing in the US, stated that “Revenue is projected
to continue declining at an average annual rate of 1.9% to total $7.8 billion in the five years to
2021” concluding a decrease in the market as a whole (“Computer Manufacturing” 1). Without
good research and development HP could fall behind in the technological era. The new markets
HP Inc. must inhabit involve the millennial generation. This social group is the main market for
technology.
Creating new innovative products for a different type of market will be a challenge for HP as it
goes into its first official year as a split company. With the market for PC’s and printing
diminishing, HPs future relies in a new market. According to IBIS World, computer
manufacturers continue to go out of business as technology increases ("Computer
Manufacturing." 1).With no grasp on the mobile or tablet industry HP has to adjust its
production. Tablet computers and new technology are trending, leaving the company behind.
With the growth of tablet computers there is a looming uncertainty of how much longer before
PC’s and printers are out of date. The push further into the electronic market will be a challenge
for HP as they grow to develop market share in new markets.

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Problem Analysis and Description
Hewlett Packard was once a strong thriving company that led technological development.
Though it is still considered a strong company, HP has been losing revenue and market share for
several years. In 1998 revenues for HP continued to rise until around 2011 when revenue began
to decrease ("Hewlett-Packard: Statistics" 1). The chart below depicts this dip in revenue,
showing each year of HP’s revenue
from 1998 to 2015 ("Hewlett-Packard:
Statistics" 1). HP grew with the
increase in technology but was stunted
with the rise of mobile phones and
devices like tablets. This revenue
decrease is a large symptom of the
overwhelming problem for which HP struggles. According to the HP 2015 fiscal report, the
company’s net revenue is down 7% from the previous year and the fourth quarter is down 9%
from the previous fourth quarter ("HP Inc. Reports” 1). With the constant decrease in net revenue
this gap effects the company and its ability to grow. The change in revenue is not the only
symptom that shows a larger problem for the company. HP also showed signs of a larger
problem with the company split.
Hewlett Packard Enterprise and HP Inc. were made official in 2015. The split was decided in
order to increase efficiency in development and push HP further into the technological era. Meg
Whitman describes the split of the companies, in the 2015 annual report, as splitting into
companies that each have “the independence, focus, financial resources and flexibility to respond
to a constantly evolving market while generating long-term value for stockholders” (Whitman 2).

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This split is a symptom of the trouble HP is having in today’s market. With splitting the
company, each segment can focus on generating new ideas to compete with technological
advances, where HP has a whole previously had struggled. Before the split, the company was
large and handled many different segments of the market at once. Branching into two companies
allows for a more focused approach. The need for a split shows a gap in the company’s focus
with each individual market, however, the company’s largest gap would have to be its low
market share in the growing technological industry.
With the rise of new technology of mobile tablet computers, HP is left in the dust. This new
technology is changing the market and creating new market segments, which creates new
competition. HP began to lose its market share to companies such as Amazon and Samsung, but
the largest market threat, is Apple. Over the last five years the growth of Apple has been
exponential, hurting HPs share in the market and pushing the company out. The market for the
mobile industry was booming, as shown in a table of total sales/revenue for Apple from 2011-
2015 (“Apple Inc.” 1).
Year 2011 2012 2013 2014 2015
Sales/Rev
(Billions)
108.6 155.97 170.87 183.24 231.28
Apple and other mobile industry leaders were developing and producing products at mass
amounts as the market became more accustom to the functionality and ease of tablet devices.
Although HP tried to develop with the HP slate tablet and HP Pre and Veer mobile devices, the
amount of competition from Apple, Samsung and Amazon gave HP very little market share.
According to IBIS world, HP is not a
major competitor in online computer
and tablet sales, which contributes to a large amount of sales for computers and tablets, HP is
placed in the “other” category among many other companies (“Online” 1).

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Having a low market share effects HP the most due to the growing technological industry and
decrease of the PC industry. The previous symptoms and gaps refer to a larger problem that HP
has been facing for years. There are many symptoms that revolve around this problem, but the
main symptoms include the revenue gap, the split of companies to enhance focus and
independence, and HP’s low market share in the mobile industry. The lack of market share is a
large underlying problem for HP and will continue to become worse as the industry grows. The
fish bone diagram listed in the appendix under diagram A, illustrates why HP has such a low
market share in the mobile industry. HP was a leading contributor to the technological industry
for many years, until the tablet became the norm. With little effort made to establish the brand
with tablets and mobile devices, HP retained low market share in the industry. Though HP has
some mobile and tablet devices, the market share is so small that many of the brands have been
discontinued. The company is more focused on the old industry of products rather than the new.
This lack of focus leads to poor products with very little research and development. The HP
tablet selection, the Pro, Elite, and Slate, are all fairly similar to other tablets on the market, with
a high price tag of $500-$1500 (“HP Tablets” 1). With very little innovation and development
put into these products, the products are almost unseen by a majority of the market. Increasing
the company’s product development to create new and different products would help to lessen
the overall problem of the companies low market share. HP however, does not focus on these
tablet products because most of its sales revolve around laptops and desktops. The pie chart
shows the division of sales for HP for Quarter ending July 31, 2015 and percentage of sales to
each category, based off of the HP Company and Subsidiaries Segment/Business Unit

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Information Statement (“HP Inc.” 1). Tablets and mobile device sales reside in the “other”
category at 3.8%, showing HP’s low market share for tablet
and mobile products (“HP Inc.” 1). Having market share in
the mobile industry is important due to its growth in the last
decade. In order to understand why there is such a steep
increase in the mobile industry HP must understand the
change in value for the consumer and the market as a whole.
When looking at the problem of why PC demand is decreasing, one journal took a scientific
approach. Bringing Non-adopters Along: The challenge facing the PC industry, written by Susan
A. Brown and Viswanath Venkatesh, describes the categories of adopters, innovators, early
adopters, early majority, late majority and laggards (Brown, Viswanath 77). Innovators are the
first to discovery new products available to the market, where as early adopters are the second to
adopt these products and make them more recognizable. Early and late majority involve
households and the majority of the US. Having the early and late majority means the product has
grown large enough to reach most of the public. The last group is the laggards, which represent
people who choose to stay with their current product and refuse to change. The authors describe
the adoption in the PC industry in 2008, which can be related to the growing industry of mobile
devices today. Early adopters and innovators have had tablet products for a long time, allowing
early and late majority to begin to enter the market. Tablets and mobile phones are household
products than some consumers carry with them on a daily basis. The authors refer to the early
and late majority as people who wait on others decisions, but not wanting to be behind with
technology (Brown, Viswanath 78). Early and late majority adopted PC’s in the mid 2000’s and
now that tablets and mobile devices have become the norm, these adopters are moving in that

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direction. This change in market share for HP directly relates to the change in adoption among
consumers. As more people move from their PC to a tablet, more will adopt this new technology,
until HP is left with the laggard category. This leaves HP’s lack of market share to be a large
problem now and in the upcoming years.
Another reason for HP’s low market share involves the amount of competition for the
mobile industry. The company was a leader in the PC industry, until the release of the IPhone in
2007, which started a surge in the mobile and tablet segment. According to IBIS world, the main
competitors in the tablet industry are Apple, Amazon and Dell Inc. (“Online” 1). HP is behind
with only a few, fairly unpopular, tablets on the market, for the growing industry. The database
IBIS world concluded the state of the mobile market as growing, and “As the economy continues
to pick up, higher projected disposable incomes and an improved sense of financial stability will
support demand for industry products” leading to an even greater growth in the tablet industry
and a greater hit to the PC industry ("Online." 1).Without market share, HP’s revenue will
continue to decline at an even faster rate, showing the overall problem facing HP. These large
competitors, due to early adoption into the market, are difficult to beat. Apple’s strong sense of
innovation and development allow the company to create new products that take over the
industry, making it more difficult for HP to gain market share. As the industry grows, more
companies are switching over to the mobile industry and creating their own tablets and mobile
devices, making even more competition in the market. The increased amount of competition
makes it difficult for HP to gain share in the industry.
Though there are many reasons why HP does not have market share in the mobile industry, the
largest consist of its poor products and lack of innovation and development, as well as its mass
amounts of increased competition and having unfocused goals. As shown in the fish bone

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diagram, all of these issues are attributed to the main problem for the company, its low market
share in the growing mobile industry. Without market share, revenue will continue to fall for the
company and it will slip into laggard territory, making its products obsolete. Knowing the issues
for why the company has low market share will allow the company to improve and develop, in
order to compete in the industry and gain market share for the future.
Solution and Evaluation
When dealing with HP’s low market share in the mobile industry there are many solution options
to fix the issue, however only some are ethical and feasible. One of the tracks HP could take is
to partner with a more successful mobile device company, such as the windows phone and
tablets from Microsoft. Although Microsoft is not a leader in the mobile device and tablet
industry, it has a larger following for its products such as the Surface Tablet. Microsoft holds a
3.8% share in tablet manufacturing in China (“Computer Tablet” 1). Due to its lower market
share, pairing with HP to create better more innovative tablets could boost market share for both
companies. The two companies could create new tablets and mobile devices that have a higher
market acceptance. This solution is valid because Microsoft, due to its lower market share would
be more willing to partner with HP to increase share, whereas other more successful companies
in the mobile industry have no need to partner.
The issue of having low market share in the mobile market shows the struggle HP has with the
industry. One solution to the problem is to leave the mobile industry altogether and focus on
laptop PC’s and new markets, such as 3D printing, 3D scanning and immersive computing
products. According to IBIS world, the market for PC’s is declining, but the market for laptop
PC’s is growing by an annual rate of 2.5% (“Retail” 1). This rate is slower due to the increased
popularity of tablets, but the laptop industry is still in the growth phase because of the demand

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for personal computers in US households (“Retail” 1). The 3D printing market is also on the rise
with a GDP annual growth rate of 2.3% and an IVA annual growth rate of 16.7%, showing an
increase in value in the market (“3D Printer Manufacturing” 1). The laptop and 3D printing
markets are growing and HP already has a grasp on the computer manufacturing industry,
holding a 26.8% market share, as well as beginning development into 3D printing (“Computer
Manufacturing” 1). Having growth in the unsaturated markets of 3D printing and 3D scanning
allows HP to penetrate the market and become a leader. The mobile industry is dominated by
Apple and Samsung, regardless of innovation, HP may be too far behind to compete with the
leader companies. It is possible that leaving the mobile industry altogether and better allocating
resources to more profitable markets could be a solution for HP’s issue.
Another viable option for HP’s problem would be to allocate money and resources into its
mobile product development to increase sales of HP mobile products. With the world shifting
over to mobile devices and tablets, having a share in the market could increase sales for HP and
allow the company to move forward in the mobile industry. As stated in the 2014 annual report
for HP, “we have been negatively impacted by the market shift towards tablet products within
mobility products, which has reduced the demand for PC’s”, without adapting HP will continue
to be negatively impacted by this issue (Whitman 53). Allocating money and resources into
products such as the OLED screen, a flexible, thinner and lighter mobile device screen would
help HP to gain some market share in the mobile industry (Honig 1). These new developments
could help to put HP back on the map in terms of the mobile market.
Decision Matrix
To conclude the best solution to HP’s low market share in the mobile industry it is important to
look at the saturation of the mobile market and the technological market as a whole. Criteria used

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in making a solution decision includes profitability of solution, ability to increase company share
in the tech and mobile industry, ability to increase product development and innovation and
ability to improve the company image. These criteria were used to evaluate each solution in a
decision matrix as shown in the appendix under diagram B.
Profitability has the most weight in this decision matrix because HP wants to change its market
share to gain profit. The solution to HP’s problem must be profitable in order for the project to
even be considered. Increase in mobile market share holds the second highest weight due to its
relation to the problem. HP’s low market share is the overall reason a solution is being sought
after for the company. Product development holds the third highest weight due to the changes in
the technological industry, product development is the only way to get ahead in the tech industry,
but if the solution is not profitable development will not matter, so development is weighted at
.2. Company image has the least amount of weight with .1. Although HP’s image is important in
decision making, profitability, market share and product development are more important than
establishing a better company image.
When looking at the partnership project option it is clear that this option is not a good solution
for HP. Although Microsoft’s tablet has done fairly well profit wise, the market share for the
company is still low. The Surface, Microsoft’s first tablet, launched in 2012 but did not become
popular until the Surface 3 was released in 2014 (“Computer Tablet” 1). In 2014 Microsoft
brought in $1.1 billion revenue from tablets alone, showing that a merger with HP would be
somewhat profitable (“Computer Tablet” 1). However, due to the already saturated mobile
market there is a low chance that a partnership will increase Microsoft’s 3.8% market share to a
high enough level in order to compete with Apple and Samsung (“Computer Tablet” 1).

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As shown in the pie graph, Apple and Samsung rule more than 38% of the entire market for
tablet manufacturing in China (“Computer Tablet” 1).
Without a large increase in market share, a partnership
may not be beneficial enough for HP. Product
development received a lower ranking in the decision
matrix due to a lack of innovation in tablets and mobile
devices. According to an article from Gadgets.com, the
IPhone and Microsoft Lumia are fairly similar, showing little innovation on Microsoft’s end
(“Lumia” 1). Microsoft is more focused on its software development work, due to its 17.1%
share in the software developing industry, rather than tablet and mobile phone products
(“Software Publishing” 1). As far as company image is concerned, HP pairs with Microsoft with
most of its PC products, so the partnership would have little to no effect on the company image.
Allocation of resources was ranked the second choice in the decision matrix with a high ranking
in product development. Using resources to further development for current products, such as the
Pro, Elite and Slate tablets, could enhance the products, making them more desirable to the
consumer. One form of development HP would look into would be OLED screens, a thin,
unbreakable screen that is flexible and able to bend into a curve (“LG” 1). However LG, a
Korean electronics’ company, holds the market for flexible phones with its product the LG Flex
(“LG” 1). In 2015 LG shipped 59.7 million smartphones and incurred sales of $3.26 billion for
its mobile communications division, showing that HP is already behind in the OLED industry
(“LG” 1). If HP were to work on developing the OLED technology into its own products,
development could be high. This would not be the first time that HP tried to develop products to
gain a greater market share in the mobile industry.

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In 2010 HP acquired smartphone leader Palm for $1.2 billion, along with the WebOS operating
system, in order to get into the tablet business (“HP uploads WebOS” 1). However, HP
considered the product to be unsuccessful due to lack of traction in the mobile market compared
to the Apple IPhone (“HP uploads WebOS” 1). Palm and WebOS were sold to LG in 2013 and
HP has lacked innovation in the mobile industry ever since (“HP uploads WebOS” 1). Due to the
company split in 2014, major projects such as mobile development were put on hold. Though
product development is important for the company’s growth, the split makes it difficult to
allocate funds to larger development projects (Whitman 12). As shown in the graph from HP’s
annual report, the split reduces revenue amounts for both segments of the company due to
services staying with
Hewlett Packard
Enterprise and products
moving to HP Inc.
(Whitman 12). With each company having a segment of the overall revenue, allocating resources
and funds to new projects is more difficult. With a lower amount of cash, a large developmental
move may not be a profitable project for HP (Whitman 12). Even with product development, HP
is far behind in the tablet and mobile industry compared to leaders Apple and Samsung. With
such a saturated market of competition and companies coming out with new innovative products,
HP will continue to struggle for market share. When looking at allocating funds for development
it is clear that this solution would be a waste of money for HP due to lack of profitability and no
increase in market share, even if product development would be relatively high.
Cost Benefit Analysis for Solution

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According to the decision matrix, the best solution for HP’s problem with low market share in
the mobile industry is to get out altogether. Although this solution is a bit unconventional, seeing
as the mobile technology market is growing, the resources being used to create products that hold
such a small amount of market share is a waste of time for HP (“Online” 1). Staying in an
industry that HP holds no market share and little innovation does not stay true to the vision of the
company (“HP History” 1). HP’s vision states “to create technology that makes life better for
everyone… To invent, and to reinvent. To engineer experiences that amaze”, and using its
resources to make phones and tablets similar to other companies does not stay true to the
company’s vision for inventing, reinventing and creating a better life for people (“HP History”
1). According to IBIS database, HP holds such a low market share in the tablet industry that the
company is featured in the “other” category with other small tablet manufacturers, showing the
company holds no share in the industry (“Online” 1). Instead of staying in this industry with no
market share, HP can thrive in new undeveloped markets and do what the company was
envisioned to do (“Online” 1). These new markets include 3D printing, 3D scanning and
immersive computing technologies, but may also include new product innovation in these
categories.
In 2014 HP launched its new product Sprout, the world’s first immersive computer with the
ability to scan 2D and 3D items, capture them into a program where the items can be “mashed”,
and then printed on a 3D printer (“Sprout” 1). This new type of innovation will lead HP into a
new era of technology. Since this product is fairly new it is centered on commercial use, rather
than consumer use at this point, however with more development this new type of computer
could be the new PC (Westover 1). The product is used in design, engineering, medical and

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aerospace fields to create parts and designs easier and faster with the scanner and 3D printer
(Sedgwick 1).
HP’s new development in these markets shows more promise than the mobile market due to the
growth in 3D printing and the ability for HP to penetrate the market early to gain acceptance.
The 3D printing industry is set to grow within the next 5 years with an industry GDP growth of
6.5% per year (“3D Printing” 1). With progress for 3D printing for medical and aerospace use,
3D printing will become an easier way to create medical and aerospace tools to help cut down
costs and time (“3D Printing” 1). In an article from Automotive News, 3D printing is becoming
the way of the future with automobiles as well (Sedgwick 1). The author D.Sedgwick quotes
Delphis Manager of Manufacturing in saying ““You can make it smaller, lighter and simpler,”
Rhinehart says. “Now you have complete design freedom”” showing the future for 3D printing
technology (Sedgwick 1). 3D printing is a growing industry where HP can lead the way if the
company focuses on these new markets. The table
shows the growth and revenue for the 3D printing
industry in its beginning years (“3D Printing” 1).
With HP’s lead in the immersive computer industry,
the company holds a strong spot with 3D printing and scanning, which will continue to grow as
3D printing becomes more available. Due to the extreme competition in the mobile market, it is
in HP’s best interest to leave the market all together and allocate its resources into more
worthwhile projects for the company. Within the next few years, referring again to the revenue
outlook table, 3D printing will become a profitable industry for HP to lead (“3D Printing” 1).
Though there will no mobile market share for the company, its development and company image
will thrive in a completely new market that has not fully been invaded, making focusing on new

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markets the best solution for the company. The solution is the most ethical in regards to HP’s
current situation in the mobile market and the company’s future goals. Focusing on the 3D
printing industry will help medical and aerospace fields as well as designers and engineers by
providing easier more efficient ways for employees to do their jobs. 3D printing allows for
creativity and efficiency in the work place and possibly for consumers use in the future.
The following is a cost/benefit analysis showing the tangible and intangible costs and benefits of
HP’s solution, listed in the Appendix under diagram C. The cost benefit analysis was based off a
of five year time frame with HP having 287,000 employees, 35,000 of which worked in 3D
printing in the solution (“Hewlett-Packard” 1). The average salary for an HP employee is
$60,000 per year (“Average Salary” 1). The property plant and equipment information was
pulled from the HP Annual cash flow statement (“Cash Flow” 1). Marketing costs were
calculated using figures from statista.com (“Hewlett-Packard: Statistic” 1). The tangible benefits
of Immersive computing, revenue from 3D printing and 3D scanning were calculating using the
revenue outlook table above (“3D Printing” 1). The information is a rough estimate and not exact
figures. The cost benefit analysis clearly shows the gain in choosing the new markets solution.
Although the development costs such as employees and equipment are high, the tangible benefits
of revenue from the new markets outweigh those costs due to the growth in the industry in the
next five years (“3D Printing” 1). Overall the net tangibles for the solution are a positive two
billion.
The intangibles for the solution involve a large amount of time, but the company no longer deals
with the mobile industry so that time and effort is put into 3D development. The solution
category does not have employees losing jobs. Focusing on a new market actually holds the

21. 21
potential for new jobs. The benefits include helping the medical and aerospace fields while
creating goodwill and an enhanced image for the company.
The growth in the 3D printing, scanning and immersive computer market will continue within
the next five years, showing promise for HP to become a leader in those markets (“3D Printing”
1). With the solution to leave the mobile industry altogether, HP will save money while staying
true to its vision of innovation and helping people (“ HP History” 1). As shown in the decision
matrix and cost/benefit analysis, changing markets will be a powerful and profitable move for
HP that will lead to a large market share in the 3D computing industry as a whole, as well as
improve product development and innovation, while enhancing the image of the company. To
solve the problem of HP’s low market share in the mobile industry HP must take a complete turn
and move away from the crowded industry in order to gain more profits and develop in a new
industry. HP cannot compete with Apple and Samsung, so money wasted on trying to compete
with those brands is better used in developing new products for the 3D printing and computing
industry.
Implementation
The recommended solution would bring a great deal of change to HP. Most departments would
be effected by this change due to the complete switch in market. The most effected departments
would be the Business planning department, to analyze a new strategy’s to approach the industry
and grow in the future, and the Finance department that would strategize a new financial plan
(“HP Careers” 1). As well as the Engineering and Engineering services department that would
design and create the new products to allow for good market growth (“HP Careers” 1). This large
change would affect all aspects of HP, however, departments from HP Inc. will be more effected
than Hewlett Packard Enterprise. According to an article from HP about the split in 2014, HP

22. 22
Enterprise deals with current projects such as networking, storage and the cloud, whereas HP
Inc. deals with personal systems, printing projects and new “innovations that will empower
people to create, interact and inspire like never before” making HP Inc. the affected party in the
recommended solution (“HP to Separate” 1). HP Inc. holds a leading position for printing and
the personal systems market, putting the company in a good spot financially in the coming years
(Whitman 12). HP Inc. has the finances and drive possible to implement this solution.
In order to fully implement the solution of moving into the market of 3D printing, scanning and
immersive technology, there are steps that need to be followed in a certain order. The Gantt chart
and table is outlined in the Appendix under diagrams D1 and D2, showing the process and steps
for this solution. Though the penetration into the 3D industry will go on for many years with new
developments and innovation, the Gantt chart is based off of a 5 year time scale.
The first year revolves around strategy, research and leaving the mobile industry. The most
important beginning steps involve creating a new strategy and financial plan in order to deal with
allocation of funds and resources. The company will also need to negotiate new plans with the
manufacturer, these steps will take around 2-3 months. The next steps involve moving funds,
employees, and equipment around to better fit the new venture into the 3D industry. These steps
will take 4 months but acquiring new equipment could take around 6 months, due to the
complexity of the equipment. Following the move out of the mobile industry in year two, there
would be intense research done around the market and development of the new products
(“Market Penetration” 1). The company will also conduct a feasibility study and cost analysis of
the future projects in the 3D printing industry to have an overall plan to move forward (Martin
1). This research will take around 3-4 months.

23. 23
Years three, four and five revolve around the product lines and development of new products. 3D
printing and scanning development will begin after the company confirms strategy and has
sufficient research. The 3D development process will take around 5 years including the
manufacturing and testing phases of the 3D printer. However, the research being done on 3D
printing projects will continue after that 5 years ensuring that new products are innovative and up
to date with current technological advances. During this research and development stage of 3D
printing HP will focus most of the company’s efforts on Sprout, the 3D printing and scanning
immersive computer, because Sprout has already penetrated the immersive computer market
(“Sprout” 1). The next step will be for HP to begin development on Sprout 2, which could take
roughly three years including testing and manufacturing, according to past project history (“HP
History” 1). Though HP Inc. is a larger technology company, the split makes it more difficult to
work on more than one money intensive project at a time. In 2015 HP Inc. brought in revenue of
103.4 billion dollars (“HP Inc. Reports” 1). One money intensive project will leave room for
time adjustments. Working on Sprout will create market share for the company as well as bring
in revenue for new projects such as 3D printing. While Sprout 2 is in the testing stage, engineers
and designers will be freed up to work on the new 3D printer. After Sprout 2s release the
company will run an intensive marketing campaign for the product for 3 months to gain market
acceptance. After this step, HP will reevaluate its pricing strategy and adjust its marketing
strategy depending on sales. The last step for this solution to be implemented is to continue
innovation and development for the products, the Sprout and 3D printer.
The project as a whole will take a number of years and then continue on into the future. If the
solution is implemented correctly, HP should be a successful leader in the 3D printing and
scanning industry and hold that spot for many years. With the recommended solution, HP Inc.

24. 24
will work heavily on penetrating the market for the next 5-7 years, and continue research and
development in future years.
In order for the solution to work well for the company, HP Inc. must follow steps to implement
to solution. Though all of these steps are important, there are critical steps to take in order to
make everything else run smoothly. The marketing and financial strategies are the most
important items when looking at penetrating a new market. The financial strategy will be a factor
in almost every decision the company faces. Market research and a feasibility study are also
critical because knowing how to reach the market and knowing what is feasible for the company
will allow HP to make long term decisions. Analyzing and adjusting the market strategy is also
critical to allow for changes in the market and economy.
Some task time frames are less important that the strategy driven tasks such as selling inventory
and machines. HP Inc. revenues were $103.4 billion in 2015 so selling old mobile inventory and
machines is not as important as focusing on the strategy of the company (“HP Inc. Reports” 1).
The development process in the later years of this solution require large amounts of time in order
to collect information and innovate new products. Although they are important, these tasks,
unlike the strategy tasks, have more freedom to adjust. Though there are financial reasons for
ending tasks on time, without proper research and development, there is no product. The release
dates and development deadlines for these tasks are adjustable in order for the tasks to be able to
be implemented properly.
Success Metrics
When looking at the success of the solution for HP, it is important to look back at the original
criteria for the chosen solution. In 2015 HP Inc. had $103.4 billion dollars in net revenue, which
was down 7% from 2014 (“HP Inc. Reports” 1). The personal systems segment, which includes

25. 25
HP’s mobile segment was down 14% year over year (“HP Inc. Reports” 1). The revenue in the
mobile industry is shrinking for HP, however, the recommended solution allows for growth in a
new market so the company can recover lost revenue. If the solution is implemented correctly,
HP will be a leader in the 3D printing and scanning industry. According to an article from CIO,
revenue from 3D printing products is set to triple within the next four years starting in 2016, to
$21 billion dollars (Mearian 1). The recommended solution would have HP successfully in the
3D printing market within those 4 years, showing the profitability of this solution for the
company. With HP having a lead in printing and personal computers, the company will have a
successful arrangement of products and services if 3D printing is included (“HP to Separate” 1).
Although the company will no longer have a market share in the mobile industry, HP will have a
leading market share in the growing industry of 3D printing, giving the company a better chance
at leading market share. 3D printing is being used by more companies as it becomes more
popular. The method is being used by Ford to create car parts, showing more availability in the
market for sales to industry and businesses for HP (Sedgwick 1). Being a part of a new
technological journey is what HP’s vision is all about. With entrance to the industry, HP would
be able to help the medical and aerospace field achieve new feats that would not be possible
without 3D printing. HP has room to innovate and develop new products in this industry leading
to a high amount of product development. An article from Design News states that the medical
industry is beginning to create custom patient prints for their exact needs (Murray 1). With HP’s
engineering talent there will be more improvements such as this that will make the lives of
patients easier. This intangible benefit shows the true success of the solution. HP’s vision is
about helping people and improving life and this solution allows for that (“HP History” 1).
Helping people to live better lives through the ability of technology will turn HP’s image from

26. 26
just a technology company, to a company that helps better people and the community. With 3D
printing being a new industry with room for growth HP would be successful after implementing
the recommended solution of leaving the mobile industry and would continue to evaluate its
success each year as the 3D market grows.
Conclusion
The low market share that HP holds in the mobile market will continue to become lower as
companies like Apple and Samsung continue to innovate. In order to become a leader in a
growing market, it would be in HPs best interest to move out of the mobile device industry and
into the 3D printing industry. With a growth of 13.9% projected for 2016, the 3D printing
industry holds large promise for the company to be able to grow and develop (“3D Printing” 1).
Though the company split in 2014 makes the transition of markets more difficult, due to a
smaller amount of revenue, HP has enough funds to back individual projects that lead the
company to a large market share (“HP Inc. Reports” 1). The implementation process will take 5
years to complete entrance into the market and continue after that 5 years with new innovation
and development. The solution will be a successful venture for HP with a large impact on the
company’s image, showing the true care HP has for the community (“HP History” 1). HP will be
involved in medical and aerospace 3D printing development to further medical and space
research and growth (Sedgwick 1). With the growth in the 3D printing industry and growth in
revenue over the next 4 years, HP would hold a leadership position in the market and be able to
profit from the venture eventually, due to the current growth (Mearian 1). HP would benefit from
the recommended solution, allowing the company to grow into an undeveloped market and
create innovative new products the company had always envisioned.

27. 27
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