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Hold the phone - HP wants in |
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The challenge The firm became No. 1 in PCs, but was outflanked on mobile devices The call Focus on one niche - business - and develop products no one else offered
Hewlett-Packard Co. isn't the first company that comes to mind when most people think about smart phones. The Palo Alta, Calif.-based company is much better known for it's high-end servers, computers, printers and ink.
However, after taking the reins at HP as chief executive officer, Mark Hurd has encouraged his division managers to change their thinking, move beyond tweaking existing products and aggressively seek out new markets. The results have been positive: The company is battling International Business Machines Corp. to be the world's largest technology company and has eclipsed Dell Inc.'s shipping numbers to become tops in the PC market.
Now, the company's handheld division, led by vice-president David Rothschild, is expanding into the highly competitive cell and smart phone markets currently dominated by mobile heavyweights like Nokia Corp., Motorola Inc. and Research In Motion Ltd. Their task has been to overhaul the company's signature mobile product - the iPAQ PDA, which is falling out of favour with consumers - and grab a piece of the growing mobile business device market.
Even though the company released their third smart phone model in 2006, HP still wasn't thought of as a leader in the industry. In order to change that thinking, Mr. Rothschild's solution was to get clients to pretend they could create the perfect mobile provider. The eight-month project began just a month after Mr. Rothschild arrived at HP from Sun Microsystems Inc. in February, 2006.
Once those answers were aggregated, they were disseminated throughout HP's handheld division. Executives, marketers and engineers at every level were shown the results. The more people who laid eyes on the data, the more solutions would be produced, or so the thinking went, he said.
"Clients' thoughts and ideas are relatively constrained by what people can deliver now," he said. "But we want to get at the best imaginable; it does not exist, it will probably never exist. But in your head you have a set of needs that nobody is meeting right now. To the extent that we can understand what is that extreme, then the delta between that extreme and what exists today are all opportunities for unmet needs," Mr. Rothschild said.
In fact, there were 692 unmet needs identified by IT professionals at big businesses using this system, he said.
"We used a process called 'the best imaginable provider,' " he said. "Then you have to decide what's implementable and you can start to look at how you deliver it."
Those suggestions directly contributed to the near-complete redesign of the company's handheld product line unveiled earlier this month. Five new mobile devices, five mobile software programs, 12 mobile services and almost three dozen handheld accessories for a total of 56 mobile-related products were rolled out at an HP event in New York on Sept. 5.
One of those services is the HP iPAQ Custom Touch, which allows businesses and IT professionals to customize the features of the devices they order.
Clients complained it was taking IT departments too long to outfit the devices for employees because of all the software uploading they required. "Typically, as markets evolve, customers take things apart and decide how they'd like to put things together," he said.
Compaq introduced the first version of the iPaq PDA in April, 2000, before being swallowed up by HP in 2002. However, HP has expanded the iPAQ product line to include smart phones, "pocket PC" models and PDAs with features ranging from WiFi connectivity and mobile e-mail to Global Positioning System technology.
"The PDA consumer market is very small and shrinking," he said. "The PDA business market actually has some growth in it - not the same kind of growth as we see in the smart phone business - but we still see that it has growth in it."
The iPAQ isn't as flashy as Apple Inc.'s iPhone and doesn't have a Network Operating Centre feature like RIM's BlackBerry. HP's global presence as the world leader in PC sales allows the company to market a portfolio of products to companies looking for increased connectivity and mobility.
Last year, 15 million of the estimated 650 million e-mail accounts worldwide were mobile-accessible. This year, that number is expected to climb to 30 million, and Mr. Rothschild said he expects that number to double again next year. For those reasons, Mr. Rothschild said taking market share from RIM and other competitors isn't a priority for HP.
"In a flat market, it's 'take share.' In a growing market, it's 'take a piece of the growth.' "
Submitted Date: Sep 17, 2007
Source: Globe and Mail
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