What's Behind HP's Printer Reorg?

Focus is on streamlining one of the most profitable divisions within the company.

Reorganizations are usually done when a division, unit or company is performing poorly or not executing properly. They tend to be quite disruptive, complete with layoffs. So why in the world would a company reorganize one of its most successful divisions?

In the case of HP, it has begun a restructuring of its Imaging and Printing Group (IPG) to offer some efficiencies, but it won't be anywhere near as big a change as is normally associated with a reorg. No one, for example, is going to lose their job.

"There's no big change or anything to signal," Alyson Griffin, a spokesperson for HP, told InternetNews.com. "It's literally just a follow on from our Print 2.0 transformation last year and a continuing effort to streamline the organization."

HP's Print 2.0 initiative is designed to connect better with the digital age with support for new devices and means of capturing, sharing and displaying images.

The five previous divisions, run by Vyomesh "VJ" Joshi, who has led the group since 2000 and will remain its head, were LaserJet, InkJet, Graphics, supplies, and Enterprise. Graphics remains unchanged. It will continue to support everything from billboards to packing slips with their printing supplies.

Connecting products with their parts

One of the shortcomings of the old structure was that parts were separate from the devices, so things like ink and paper were separate from InkJet and LaserJet. Now all of the InkJet parts will be in the InkJet unit and LaserJet supplies like toner will under the same roof as the printer.

InkJet and its supplies, as well as Web solutions, will be streamlined into one group while LaserJet and enterprise, due to their natural pairing, will become the third group. "We basically said 'hey, let's make this tighter', so we can be more agile, reduce cost structure, enable growth and enhance the customer experience," said Griffin.

Analyst Shaw Wu of American Technology Research figured it wouldn't be a huge change. "I think it's just adapting the business to cope with the realities of the market, and what's likely to emerge as the newer reality," he said. "It's already a pretty decent business as it is. I think it's just a feeling that the new culture with [CEO Mark] Hurd is they don't want to rest on their laurels."

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