Hewlett-Packard's Management Practices - Case Study Example

Management

Management is an important aspect in any organization. Normally, managers and others entrusted in the managerial positions happen to be leaders in their own right. Management involves the planning, problem solving, organizing, staffing, coordinating, and controlling the business. Primarily, the planning function is the main purpose of management. Furthermore, managers need to be equipped with social skills that helps them interact with the employees as well as the clients and the board members. Setting up goals and ways to achieve these goals is what defines the manager. How effective and efficient he will be in fulfilling these goals. Organization involves the checking of day to day tasks and operations in the company. It usually involves delegating and designating tasks to the employees (Buono, 2001).

According to Henri Fayol, there are basically fourteen principles of management. These include division of work, authority and responsibility, discipline, unity of command, unity of direction, subordination of individual interests to mutual interests, remuneration of employees, degree of centralization, line of authority or the scalar chain, order, equity, stability, initiative and team spirit. The manager works to ensure that the workplace is a favorable place and by employing these principles, then he is bound succeed.

Hewlett-Packard is one of the greatest companies that we currently have. The technology acompany was started by two people, David Packard and Bill Hewlett. These two people studied in the same university and shared common dreams. Amongst these dreams was starting their own company. They got together in the year 1937 to discuss about their chances of opening a company. The two were majors in different fields and each had his own specialization. Packard was good at manufacturing whereas Hewlett exceled in technology. Their expertise complemented each other and they would soon later on sign a partnership to open their business.

Notably, the manager must exhibit the following characteristics; entrepreneurial, leadership, proper decision making, and human resource management.

Entrepreneurship

An entrepreneur can be defined as a person who incorporates all the factors of production so as to produce goods. The factors of production include resources, labor, capital and entrepreneurship. Basically, entrepreneurs are conscious of the long-term goals and the scope of the economy. It would be highly unwise for one to invest in a rapidly declining economy since the chances of getting back returns are very minimal. However, entrepreneurship is a game of risk. Normally, entrepreneurs start off as small scale investors. They are driven by the passion and hunger of whatever they plan on achieving. All it takes is for one to have an idea and work upon bettering that idea. It therefore goes without saying that for an upcoming entrepreneur, there will be obstacles on the way.

Entrepreneurial Competencies

For an entrepreneur to venture successfully into a market, he requires skills that will work in his favor. There is a wide range of competencies. The most notable one is the behavioral competencies. This includes the behavioral skills that an entrepreneur should portray while on the field. Hewlett and Packard portrayed these skills excellently. They were excellent systemic planners. Whereas they did not begin on a large scale, they only did what they were able to do at the time. By manufacturing their first device, an audio oscillator, Hewlett and Packard were able to progress from there. Planning is all it took. They signed a partnership form and declared their company as a partnership corporation. They were further economical. Majority of their work was done by their hands and this curtailed the need for employees who would come in as an expense in the early stages of the company. It was until later when they started hiring employees after their business grew from a partnership to a corporation.

Risk management and risk taking is also another skill that Hewlett and Packard displayed. The duo was aware that they were entering in a largely untapped market at that time. However, with much resilience and persistence, their company made it through. They took advantage of the world war. At this time, majority of the businesses were shut down due to the unfavorable working conditions and low economy. However, during this time, Hewlett and Packard manufactured goods that were used in the warfare (Malone, 2008). They exploited the advantage to claim the technology market.

Quality performance is yet another competency that entrepreneurs should enforce. With high quality goods, rand credibility is enhanced and this helps to retain customers as well as bring in new ones. So as to ensure that their products were of high quality, Hewlett and Packard introduced an incentive program which would award bonuses to employees with high quality of work output. This then turned into high products being sold to employees.

Creativity and Innovation

A proper entrepreneur needs to combine innovativeness and creativity. Just like in management, the manager needs to devise ways that will enhance the productivity of the company. Management requires innovativeness and creativity. Otherwise, the employees would remain complacent and the business would stagnate or worse still, drop. Coming up with creative managerial strategies is essential for the growth of any company.

In Hewlett and Packard’s case, these two teamed up to produce one of the best companies in the world currently. They were from different majors but this did not deter them from realizing a common goal. Instead, they teamed up and joined their expertise to produce one of the best products at that time. Innovativeness is coming up with a new idea and strategy and implementing these ideas. More so, an entrepreneur or manager does it necessarily need to come up with slick business ideas. They can also come up with creative and innovative ways to deal with a situation and handle challenges successfully. A manager or entrepreneur needs to combine creativity and innovation to achieve the desired results.

Leadership

It goes without saying that managers require to exhibit excellent leadership qualities. Basically, the manager is the source of reference in an organization incase anything goes wrong. Employees look up to him as a source of inspiration and motivation. There is a strong difference between a leader and manager. Leaders have got followers who look up to them whereas managers have got employees who work under them. Therefore, it is important for managers to combine the leadership roles in their companies so as to get the employees follow them towards achieving a common goal. Thus, in so doing, the managers will be able to successfully control the business.

Leadership Skills

Good and efficient managers are able to borrow some of the proper leadership skills and incorporate them in the workplaces. For instance, able to execute a goal. Normally, businesses set up goals that help in propelling them forward. Take an example in increasing the sales margin by a certain given percentage. It is the manager’s duty to ensure that this goal is realized within the shortest time frame possible. Furthermore, the planning and implementing of the goals is the duty of the managers. They work to ensure that there is efficient staffing and that nothing has been overlooked in terms strategies.

Leaders are also strategically prepared and organized. When a goal is set, achieving it requires a step by step procedure. This is called an algorithm. In this case, the algorithm is set by the manager who enforces its implementation. Furthermore, leaders are visionary. They are never content and they always look out to achieve greater things. Managers also require to adopt this. The company should never stagnate and it should always be in an upward trajectory.

Hewlett and Packard were visionary individuals. They had their eyes focused towards opening up their own business and expanding it someday. Even after finishing their studies, they looked for ways to sustain their livelihood and at the same time improve their company. When they acquired employees, they tried to motivate the employees by offering them incentives such as bonuses. Furthermore, their visionary leadership was experienced in the year 1957 where they laid out the objectives of the company. Some of these objectives include maximizing profit, customer satisfaction, emphasize growth, and provide employment opportunities, seeking new opportunities in the field of interests, and involving the society in the mandate of the company (Malone, 2008). Laying out these objectives proves that there are visionary managers and they are driven with passion and progress of the company.

Decision Making

Managers usually find themselves in the hot seat when making decisions. Whether it is cutting a deal or settling out an issue involving the employees, the manager has to make decisions every day. The actions that the manager makes is usually arrived at after numerous decisions have been made. Basically, managers make their decisions based on the supposed best outcome. There are alternatives that are presented to him and it is his duty to choose the one that bests suits the company. More so, the managers make their decisions that aim at achieving the organization’s goals. Outcomes of these decisions will dictate the direction in which the company or organization will plummet to.

Rational thinking controls the decision making process. The human brain is wired to recognize experiences and learning among other factors. Afterwards, the thinking process follows. This is whereby the manager considers all the options presented to him and reasons according to the situation at hand. Selection is the third step. In this case, the manager considers all the possible alternatives to the situation before coming down to a single one. Evaluation is the last step. The manager evaluates the option he chose with respect to the goal at hand (Lock & Gower Publishing Company, 1998).

Hewlett and Packard were evaluating options of buying a computer firm. In the 1960s, the use of computers spread and it was evident that as time passes by, computers will be an integral part of the human lives. They were intent on buying Digital Equipment Company for a total of $25 million. However, the deal did not go through as planned and they embarked on producing their own computers. However, they were reluctant on pursuing this line of work even though the sales for their computers were rising. They had the chance to totally own the computer industry but they hesitated (Malone, 2008). Their decision making process was a slow and they were unsure of the route they wanted to take. However, at the beginning of the 20th century, they were one of the leading brands in the sale of computers.

Human Resource Management

The human resource manager is an important person in any organization. They are the ones entrusted with the recruitment and training of new company staff, performance appraisals, maintain a conducive working environment, managing disputes, and developing public relations (Powell, 2000).

HP has effectively used the human resource management to their full advantage. They created a conducive working environment in which the employees’ achievements are recognized. They work in a participatory environment. This refers to flexibility and sharing of ideas in groups. Medical insurance covers were also introduced in the company and there is an annual picnic. Recreational facilities are also provided by the company and profit sharing incentive by the management (Malone, 2008).