Resolving Strategic Integration Challenges in the Multibusiness Firm: Meg Whitman Moves from “Better Together” to “Splitting HP in Two”

Resolving Strategic Integration Challenges in the Multibusiness Firm: Meg Whitman Moves from “Better Together” to “Splitting HP in Two”

March 7,2016Working Paper No. 3397

This paper examines Meg Whitman’s tenure as HP’s CEO from September 2011 till March 2016. It considers the external contextual forces shaping radical changes in the information technology industry as well as the internal contextual forces associated with the unresolved issues left by her predecessors that she had to face at the time of her appointment. It documents how she identified and assessed these external and internal strategic challenges, culminating in her initial conclusion that the company’s consumer-oriented and enterprise-oriented businesses would perform “better together” but needed to be significantly strengthened through improving the key elements of the company’s strategic leadership capability. The paper then documents how the continued rapid changes in the information technology industry reduced the inter-business complementarity while customer and competitive forces increased the intra-business complexity of the consumer-oriented and enterprise-oriented businesses. These changes potentially threatened to drive HP’s adaptive capacity from anti-fragile to fragile and culminated in Whitman’s radically new conclusion by October 2014 to “split HP in two:”  HP Inc and Hewlett Packard Enterprise (HPE).  The remainder of the paper focuses on how Whitman continues to develop the strategic leadership capability of HPE during 2015. It concludes with assessing in early 2016 her differential contributions as CEO to HP’s integral process of becoming by creating the two new companies.