Company H is one of the largest technology companies in the world. Started in 2010, company H is one of the largest with revenue of $127 billion in 2011. Company H is a leading producer of desktop computers, laptops, printers and computer hardware. The case explains the problems in company H board of directors. The problem began when the company started to violate the code of ethics after the death of its founder, Person H. The problem grew when the company’s confidential information was leaked in an anonymous article. Person D, CEO of company H, started secret surveillance on board of member and found the person who leaked the information. This issue led to the outbreak of a bigger problem which led to the resignation of one of the members of the board and termination of person D. The company then selected Person H as the new CEO under whom the company grew financially strong but Person H was filed a lawsuit by Person JF, who worked as a hostess at company H sponsored events which made him resign. Next, the company appointed Person LA as CEO who suggested focussing on enterprise software solutions business. The business constituted $25 billion and the hardware business grew to 40 percent of HP’s total revenue. The board members fell victim to group thinking as Person RL, the board chair, supported Person AP and more problem aroused when an outside firm proposed Person AP as CEO which later led to step down of Person RL as chair of company H board. Person MW, led the company as CEO and divided the business into hardware and another enterprise which performed decently in 2017. To identify: Whether its CEO, the board of directors or both has to be blamed for company H’s shareholder value destruction and determine whether any recourse do the shareholders have.

Question

Want to see the full answer?

Answer 1

Question

Chapter MC, Problem 21.1DQ

Summary Introduction

Case summary:

Company H is one of the largest technology companies in the world. Started in 2010, company H is one of the largest with revenue of $127 billion in 2011. Company H is a leading producer of desktop computers, laptops, printers and computer hardware. The case explains the problems in company H board of directors.

The problem began when the company started to violate the code of ethics after the death of its founder, Person H. The problem grew when the company’s confidential information was leaked in an anonymous article. Person D, CEO of company H, started secret surveillance on board of member and found the person who leaked the information. This issue led to the outbreak of a bigger problem which led to the resignation of one of the members of the board and termination of person D.

The company then selected Person H as the new CEO under whom the company grew financially strong but Person H was filed a lawsuit by Person JF, who worked as a hostess at company H sponsored events which made him resign. Next, the company appointed Person LA as CEO who suggested focussing on enterprise software solutions business. The business constituted $25 billion and the hardware business grew to 40 percent of HP’s total revenue.

The board members fell victim to group thinking as Person RL, the board chair, supported Person AP and more problem aroused when an outside firm proposed Person AP as CEO which later led to step down of Person RL as chair of company H board. Person MW, led the company as CEO and divided the business into hardware and another enterprise which performed decently in 2017.

To identify: Whether its CEO, the board of directors or both has to be blamed for company H’s shareholder value destruction and determine whether any recourse do the shareholders have.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

What kind of diversification is GE pursing? What are the sources of value creation with this type of diversification? How did GE lose $507 billion (more than 85 percent) of its market valuation since its peak? What went wrong? After leaving GE, Jeffery Immelt stated in 2018: “The notion of plugging financial services and industrial companies together, maybe it was a good idea at the point in time, but it is a uniquely bad idea now.” To what is Immelt referring? Why does he think is a bad idea? Do you agree? Why, or Why not? In the bestseller Good to Great, Jim Collins advances the hypothesis that the greatness of a leader is known only after the leader has departed. The business press has celebrated jack Welch as the greatest CEO of the last century. After reading this Minicase, do you agree with Collins’ strategic leadership hypothesis? Why or Why not? Note: When interviewed in 2018 about the GE situation, Jack Welch had this to say: “I give myself an A for the operation of GE, but an…

Can any firm beat Amazon in the marketplace? If not, why not? If so, how can they best do so? How formidable a competitor is Google for Amazon? Consider Amazon's major strengths, weaknesses? Is Jet com a potential concern for Amazon? Given the importance of understanding the external environment, why do some firms fail to do so? Provide examples of firms that did not understand their external environment? What were the implications of the firm's failure to understand that environment?

With COVId-19 in full swing, the app based food delivery business has flourished in Bangladesh, with Food Panda holding a commanding lead in the market share. How can Food Panda retain its lead in terms of market share? Discuss in the light of any three of the Porter’s Five Forces that you deem to be the most appropriate?