HP axes global operation, shunts it into main business

Move part of ongoing restructuring

Hewlett-Packard says it is ­dissolving its global operations organisation and delegating the group’s activities to the company’s three main business groups, as part of an on-going companywide restructuring.

HP’s Imaging and Printing Group (IPG), Personal Systems Group (PSG) and Technology Solutions Group (TSG) will now be responsible for supply-chain, procurement, logistics, order-fulfillment and marketing functions, such as HP.com and CRM. These were all part of the now-defunct global operations ­division.

Specifically, company-wide supply-chain operations and global procurement services are now the responsibility of PSG, while worldwide logistics and strategy planning, and modeling activities will reside in IPG, says HP spokeswoman Alexa Hanes. IPG is also responsible for internet and marketing services, and content management, which includes HP.com. The realignment puts TSG in charge of equipment management, worldwide and regional sales operations, and CRM functions.

The move is part of an effort HP began in July 2005 to simplify the company’s structure and reduce costs. At the time, HP said there would be about 15,300 layoffs because of the restructuring. The company also killed off its Customer Solutions Group and moved those sales people into the product groups they were serving at the time.

The entire restructuring — which is expected to be complete by the end of the US fiscal year 2006, on October 31 — will improve HP’s profitability through US$1.9 billion (NZ$3 billion) in annual cost savings, the company says.

Hanes says some workers may be made redundant as part of last week’s realignment, but the company has not made any final decisions as yet.

If there are layoffs they will be part of the 15,300 already announced by the company, she says.

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