Stopping the Sprawl at HP - Essay Example

ESS, HPS and Software are clustered under the Technology Solutions Group (TSG). Due to its big size, HP has many subsidiaries worldwide; thus there are many employees, high real estate and infrastructure costs. Operational costs are high mainly due to the centralization of operational control. In 2005, Mark Hurd took over Carly Fiorina who was removed as CEO after the dismal performance of HP in the past years. Mark Hurd had two objectives: to centralize the disorganized information systems, and to decentralize operational control.

To achieve his first objective he recruited Randall Mott, who was the main man in organizing information management systems in Wal-Mart and Dell. The objective of Randall Mott as Chief Information Officer was to trim down and improve the efficiency of IT systems within the company. The simple aim was to know at any time simple yet critical information like how much inventory does the company have, which products are bestsellers and which need to be put on sale price. At HP, as in other big companies, there is a need to tighten controls over the unwieldy number and nature of technology projects.

IT operations were spread over many data centers, databases and budgets. Among Mott’s first priorities was the consolidation of HP’s 85 data centers to just six data centers strategically located in three US cities: Atlanta, Houston and Austin, Texas. The six data centers will also showcase HP Adaptive Infrastructure products. The consolidation will be implemented over a period of four years (Hewlett-Packard, 2007). The company’s 784 databases were replaced with one data warehouse for the whole HP.

Mott also found at least 10 separate major IT budgets and several IT activities that were being conducted outside these budgets. So he put all IT and telecommunications projects under one budget (H. Havenstein, 2006). HP has 1,200 IT projects which Mott, in consultation with other IT