Case Study Description of HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy
ProCurve is Hewlett-Packard's computer networking business. HP was a very early participant in computer networking, creating and selling networking software and hardware before most of today's networking giants such as Cisco were founded. However, for most of its over 25-year history with HP, ProCurve has had an uneasy relationship with its parent company. At times, HP even sought to sell or break up ProCurve. However, by 2009 ProCurve, a resilient example of internal entrepreneurship at a very creative company seemed to have gained the attention of HP's top management who may have started to view it as a strategic asset for the company.
Authors :: Robert A. Burgelman, Webb McKinney, Philip Meza
Swot Analysis of "HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy" written by Robert A. Burgelman, Webb McKinney, Philip Meza includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Procurve Networking facing as an external strategic factors. Some of the topics covered in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy case study are - Strategic Management Strategies, Entrepreneurship, Innovation, IT, Networking and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, increasing government debt because of Covid-19 spendings, there is backlash against globalization, increasing household debt because of falling income levels,
supply chains are disrupted by pandemic , talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Procurve Networking, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Procurve Networking operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy can be done for the following purposes –
1. Strategic planning using facts provided in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy case study
2. Improving business portfolio management of Procurve Networking
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Procurve Networking
Strengths HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Procurve Networking in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy Harvard Business Review case study are -
Organizational Resilience of Procurve Networking
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Procurve Networking does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Procurve Networking has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Procurve Networking is one of the most innovative firm in sector. Manager in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Successful track record of launching new products
– Procurve Networking has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Procurve Networking has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Procurve Networking digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Procurve Networking has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Operational resilience
– The operational resilience strategy in the HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High brand equity
– Procurve Networking has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Procurve Networking to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Diverse revenue streams
– Procurve Networking is present in almost all the verticals within the industry. This has provided firm in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
High switching costs
– The high switching costs that Procurve Networking has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Learning organization
- Procurve Networking is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Procurve Networking is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Procurve Networking is one of the leading recruiters in the industry. Managers in the HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Procurve Networking has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy are -
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy, it seems that the employees of Procurve Networking don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow to strategic competitive environment developments
– As HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy HBR case study mentions - Procurve Networking takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
No frontier risks strategy
– After analyzing the HBR case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy, it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Lack of clear differentiation of Procurve Networking products
– To increase the profitability and margins on the products, Procurve Networking needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Procurve Networking has relatively successful track record of launching new products.
Interest costs
– Compare to the competition, Procurve Networking has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High cash cycle compare to competitors
Procurve Networking has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High bargaining power of channel partners
– Because of the regulatory requirements, Robert A. Burgelman, Webb McKinney, Philip Meza suggests that, Procurve Networking is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
High operating costs
– Compare to the competitors, firm in the HBR case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Procurve Networking 's lucrative customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy, is just above the industry average. Procurve Networking needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Slow decision making process
– As mentioned earlier in the report, Procurve Networking has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Procurve Networking even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Opportunities HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy are -
Creating value in data economy
– The success of analytics program of Procurve Networking has opened avenues for new revenue streams for the organization in the industry. This can help Procurve Networking to build a more holistic ecosystem as suggested in the HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy case study. Procurve Networking can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Procurve Networking in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Procurve Networking can use these opportunities to build new business models that can help the communities that Procurve Networking operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Procurve Networking to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Procurve Networking to hire the very best people irrespective of their geographical location.
Using analytics as competitive advantage
– Procurve Networking has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Procurve Networking to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Procurve Networking can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Procurve Networking can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Procurve Networking can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Procurve Networking can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Low interest rates
– Even though inflation is raising its head in most developed economies, Procurve Networking can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Developing new processes and practices
– Procurve Networking can develop new processes and procedures in Innovation & Entrepreneurship industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Learning at scale
– Online learning technologies has now opened space for Procurve Networking to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Loyalty marketing
– Procurve Networking has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Procurve Networking can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy are -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Procurve Networking.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Procurve Networking business can come under increasing regulations regarding data privacy, data security, etc.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Procurve Networking will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Shortening product life cycle
– it is one of the major threat that Procurve Networking is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Regulatory challenges
– Procurve Networking needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Innovation & Entrepreneurship industry regulations.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Procurve Networking needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Procurve Networking high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Procurve Networking in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Consumer confidence and its impact on Procurve Networking demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Technology acceleration in Forth Industrial Revolution
– Procurve Networking has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Procurve Networking needs to keep up with the evolution of technology in the Innovation & Entrepreneurship sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Procurve Networking can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy .
Weighted SWOT Analysis of HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of HP's ProCurve in 2009: Internal Entrepreneurship Navigates Evolving Corporate Strategy is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Procurve Networking needs to make to build a sustainable competitive advantage.
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