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Hp Case

In: Business and Management

Submitted By pmg1902
Words 2024
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HEWLETT-PACKARD COMPANY:

NETWORK PRINTER DESIGN FOR UNIVERSALITY

EXECUTIVE SUMMARY

The Hewlett Packard Company (HP) was one of Silicon Valley’s legends. HP is diversified into many product lines. Its key competitive advantage is “Technology Innovation”. This case is about the laser printer of HP. HP tried to develop the latest new laser printer, which is network printer and managers from each department had a meeting to discuss about whether using a universal power supply for the next generation of network laser printer called “Rainbow” is beneficial or not.

The major customers of laser printers are in North America and European countries, which use different power supply voltage. The laser printers are produced at HP’s manufacturing partner in Japan, which monopoly controls the key components. Since the lead time is almost 14 weeks, HP has to plan at least 14 weeks ahead. Therefore, this method does not respond to the changing in demand and it is not flexible for HP to deal with demand uncertainty. Consequently, the production team believes that a universal power supply can enable HP to respond to the changing demand. The following images show the comparison between the flow of the current laser printer and the network printer.

With the universal power supply, the network printer cost increases around $30 per unit. HP has to outweigh the benefit and cost of using power supply. Consequently, the managers from each department discussed and provided their perspectives. The details of their concerns and issues are as followed:

Marketing perspective: The universal power supply could reduce the lead time because team does not need to forecast the demand by geographical area. They can postpone the determination of individual market demand later.

Product development perspective: It is difficult to lower the material cost…...

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