Hp vs Ti Differs in Strategies

In: Business and Management

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Chapter 1 3

Controls for Differentiated Strategies

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Case 13-3

Texas Instruments and Hewlett-Packard
Texas Instruments (TI) and Hewlett-Packard (HP) developed, manufactured, and sold high-technology electric and electronic products. Texas Instruments had three main lines of business in 1984: components, which includ ed semi conductor integrated circuits, semiconductor subassemblies, and electronic control devices; digital products, which included minicomputers, personal com puters, scientific instruments, and calculators; and government electronics, which included radar systems, missile guidance and control system s, and in frared surveillance systems. The three businesses generated 46 percent, 19 percent, and 24 percent, respectively, of TI’s sales in 1984. Hewle tt-Packard operated in two main lines of business: computer products, which included factory automation computers, engineering workstations, data termin als, per sonal computers, and calculators; and electronic test and measu rement sys tems, which included instruments that were used to evaluate the operation of electrical equipment against standards, instruments that would measu re and display electronic signals, voltmeters, and oscilloscopes. These busine sses gen erated 53 percent and 37 percent, respectively, of HP’s 1984 sales. Summary financial information for each company is presented in Exhibit 1. Although Texas Instruments and Hewlett-Packard competed in similar industries, the strategies chosen by these two firms were very different. Exhibit 2 summarizes five major concepts related to the conten t of strategy for
EXHIBIT 1 Summary Texas Instruments 1980
Assets Equity Sales

Financial
Information (S in Millions)

1981 $2,311 1,260 4,206 253 20.1%

1982 $2,631 1,361 4,327 236 17.3%

1983 $2,713 1,203 4,580 (288) n.a.

1984 $3,423 1,541 5,742 526 34.1%

$2,414 1,165 4,075 379 32.5%

Operating…...

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