HP, Inc. Beyond 2021: Pursuing Strategic Renewal for Growth
On November 2, 2021, Enrique Lores, CEO of HP, Inc., ended the first online huddle of the week with his executive leadership team. The day was an historic one for the Palo Alto-based global company: six years earlier, HP Inc. came into being after the split of the iconic hardware company into two: HP, Inc. and Hewlett Packard Enterprise. As soon as Lores, who had become CEO the year prior, took over the reins at HP Inc., he immediately began to strategize the aggressive transformation of the hallowed company from a product-oriented to a customer experience-oriented company, identifying three areas, each requiring significant innovation:
- Evolution of core business models to adapt to changing customer needs;
- Pursuit of adjacencies in relation to the personal computer and print businesses; and
- Leveraging platforms (capability and asset) and software assets to create new businesses.
The broad and deep change initiative that he had charted for HP would require changes in skills, talent, infrastructure, and culture. To communicate what was required of his team, shift their thinking, and achieve a better multiple on their earnings per share, Lores asked his leaders to focus their attention on three key concepts: (1) Advance the business models of HP’s core businesses; (2) Disrupt using HP’s core assets; and (3) Transform the processes, cost structure, go-to-market capabilities, supply chain and brand of HP.
Perhaps unsurprisingly, discussions at the morning meeting centered around the need to harness the past and drive the future. Markets were changing, HP’s performance was accelerating and the company was seeing new customer behaviors. In addition, there was an inflection point in the PC stack and importantly, 3D printing, where HP had a great position, was attracting a lot of interest. Looking forward beyond 2021, Lores wanted to take stock of how the Advance, Disrupt, and Transform vectors of his corporate strategy were progressing in support of his strategic intent. In particular, he wanted to assess whether progress along the three strategy vectors was helping release the high level of pent-up energy in the company that he sensed in employees throughout the ranks at HP Inc., and whether the vectors were strengthening a level of confidence in pursuing his strategic intent throughout the organization.