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HP announces $1 billion saving on IT costs

by Scott Bicheno on 1 December 2008, 17:36

Tags: Hewlett Packard (NYSE:HPQ)

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Intriguing precedent

HP, the world's largest PC maker, has proudly announced that by next year it will be spending a billion dollars less per year on its IT operating costs than it did in 2005.

That was the year HP took on new chief information officer Randy Mott, whose cunning plan this three year overhaul presumably was. "We commend our IT team for building a world-class infrastructure and organization, but we're just getting started. We're now in a great position to enable future business growth," he said.

Initially it seems a bit counter intuitive for a company that makes much of its money from corporate spend on IT to crow about how much less it's spending on IT itself. Until you hear CEO Mark Hurd's take on it that is:

"For the transformation to work, we had to invest money to save money," he said. "With a lower IT cost structure we are able to reinvest dollars into go-to-market efforts. This challenge isn't unique to HP. Most companies have the opportunity to create an IT cost structure that is at least half of today's average for their industry. We can, and do, share our experiences with our customers."


HEXUS Forums :: 2 Comments

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I bet they are lying. I think they'll just reduce their spend on quality control like they seem to have been for the past 5 years and call it an IT saving.
Soon they'll be on a par with Dell quality wise.
Well that also seems to include cancelling xmas for their employees according to the news!.