Beyond the box

Hewlett-Packard has made a $16 billion bid to move beyond the realm of box shifting and into the world of e servicing. MEX spoke to Sjaak Vermeulen, vice president & general manager of consumer business organisation at Hewlett-Packard, to discover how HP intends to conquer the e world and what that means for you.

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By  Rania Adwan Published  July 4, 2001

Hewlett-Packard think big|~||~||~|Briefly describe what Hewlett-Packard does?
Hewlett-Packard is a leading global provider of computing and imaging solutions and services. Our focus has always been on making technology — and its benefits — accessible to individuals and businesses through simple appliances, useful e-services and an Internet infrastructure that's always on.

Where do you stand in the market today?
When we started in 1996, the main goal for the consumer business organisation was to be the largest IT company in the consumer space — I can safely and proudly say that this has been achieved. Sales to the worldwide consumer sector last year were a huge $16 billion and we are confident there is no other IT company in the world that sells that volume of dollars to consumers.

What HP is looking for is to become the leading provider of what we call personal digital solutions for people that live an e-life — anyplace, anywhere, anytime. Today, we sell a lot of boxes. We sell PCs, we sell notebooks, we sell printers, we sell all-in-one devices, CD writers, scanners, Jornadas, plenty of boxes. What we leading provider of what we call personal digital solutionshope will happen over time, and it is going to happen very quickly, is that most of these boxes will be connectable to the Internet, and I mean directly connectable. So from a Jornada, the customer can look forward to sending information very quickly to a printer as well as to other extras.

By making these types of devices connectable to the Internet you are essentially making them intelligent and by doing that you can start to create a dialogue with these devices, then they start to send you information back. Suddenly those very same boxes become appliances.

What do you see as Hewlett-Packards greatest challenge for the future?
It's not enough to have our products thinking for themselves, Hewlett-Packard is looking to work with other industries to make other appliances smart. The HPJetsend is a perfect example, we can build it into a dishwasher that will then order soap if and when it becomes necessary. It's like a printer being capable of ordering a new toner cartridge when it is empty.

Our future vision is of a world going ahead of us where a lot of today's appliances become smart appliances (linked with the Internet) and we want to become one of the leading providers there. We're also channelling a lot of our energies into solutions. We need to think about what sort of services we can sell to consumers by using the unique capability of the Internet.

Traditionally, our organisation started with a product, and then we moved into a channel, and then the customer, whereas in the consumer organisation we are asked to do the opposite. We start with the consumer, we try to figure out what they want, what their needs are, where they want to buy and then we go to the channel and work backwards. If you look at the PCs that we sell in Europe, we sell different PCs in the UK than we do in Germany and say France or Spain or Sweden.
||**||Beyond the box - Hewlett-Packard think big|~||~||~|
However, because the markets are different, the needs are different, and we customise products to the needs of the customers. We want to move the profit and loss responsibility to the countries as well. That is why we call them business organisations.

During our third year we grew more than 30% in the consumer space. We had a great year in fiscal 2000, we finished the first quarter, an important quarter for us in Europe, on a growth of 27%. Which just goes to show that all this talk about the industry declining, about the recession in the US and Europe, well we didn't even notice it. We are dramatically increasing the number of registering customers and have even implemented a database of consumers. It's also worth mentioning that the numbers of units shipped was even higher than 30%, because we have to accommodate a 15% drop in prices in a lot of our product categories.

Why choose Hewlett-Packard?
Because we understand our customers, we've made the effort to find out who it is buying HP products, from the family with HP technology in the home to the individual on the move and the micro businesses [those companies that have less than 10 employees, and typically mix their private and business expenditure].

Usually, from an end user consumer point of view, staying connected is becoming more and more important. It has gotten to the stage where everyone has a mobile phone; it is an emotional device, it is connected all day, and people want to stay connected, in a way that is simple and where they can keep control.

Privacy and security become an issue, but also an opportunity. The demand for customer solutions increases, especially on the services side. Bluetooth will boost consumer response to new technology and you can expect at home connectivity to become common practice. You can also expect broadband to become a pervasive factor in as little as two or three years. We also believe the world is shifting from a PC-centric approach to a much more appliance focused.

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