On 1 January 1939, there are Stanford University graduates which are Bill Hewlett and Dave Packard, they formed their partnership and decided to start a business. They decide the company’s name with a coin toss. They made a historic commitment to innovation when they founded HP in a garage. The first product they created was an audio oscillator used by Walt Disney to make Fantasia. For over 70 years since then, HP has continued innovating and helping people, businesses, and communities worldwide use technology to improve their businesses and lives.

In 1957, the company goes to public. In keeping with Bill Hewlett and Dave Packard’s respect for workers, HP takes the then-unusual step of giving stock grants to employees. The growing company begins building on the site that will become its corporate headquarters in Palo Alto, California. HP also embarks on a path toward globalization, establishing manufacturing and marketing operations in Europe.

In the 1980s, HP becomes a major player in the computer with a full range of computers, from desktop machines to portables to powerful minicomputers. HP also links computers with its electronic instruments and medical and analytical products, making them faster and more powerful. HP makes its entry into the printer market with the launch of inkjet printers and laser printers that connect to personal computers. HP’s high-quality, inexpensive inkjet printers spell the end of dot-matrix printers. In 1984, HP debuts the LaserJet printer line, goes on to become the company’s most successful single product line ever. The quality and reliability of HP’s printers make HP a highly recognizable brand by both consumers and businesses.

HP focuses on simplifying technology experiences for all of its customers, from individual consumers to the largest businesses at the beginning of the 21st century. HP grows to become the world’s largest technology company with a portfolio that spans printing, personal computing, software, services and IT infrastructure. Later in the decade, a steady stream of acquisitions increases HP’s influence in the software, personal computing and printing markets, and in 2007, HP achieves $100 billion in revenue. In 2009, after the acquisition of EDS, HP moves up to No. 9 on the Fortune 500 list.


The PEST analysis is the macro-environment or defined as external environment in business point of view. It has been affirmed to be important strategic tools to assess the market growth or decline and it is also a business measurement tool to analyze the external impact of the strategic development of a business. The factors of the PEST are Political, economic, social and technological. These elements are likely to impact your future business. It is drag in an organization considering of the external environment before the project is began. PEST analysis is very simple to complete, is a good material for the workshop session and it is also an effective brainstorming session.

Political environment, including a country’s social system, the nature of the ruling party, the Government’s guidelines, policies, laws and so on. Different countries have different social nature, different social system of the organization have different restrictions on activities and requirements. Even if the social system is constant of the country, due to distinct of the ruling party, the government policy features and influence of policy orientation of the Organization is changing at different stages. There are several important political and legal variables which are the nature of ruling party, political system, economic system, tax policy, trade and tariff controls, social and employment legislation.

Economic environment consist of macro and micro aspects. The main macro-economic environment of a country’s population and growth trends, national income, and changes in gross national product and by these indicators reflect the level of national economic development and growth. Micro-economic environment mainly refers to the service area or areas of consumer ‘s income level, consumption preferences, saving the situation, employment and other factors. These factors directly determine the current and future business’s market.

Socio-cultural environment consists of residents of a country or territory education level and cultural level, customs and aesthetic point of view and so on. The level of the cultural will affect the residents of the demand level; the customs may prohibit or restrain the conduct of certain activities; values of notion will affect the residents of organizational goals and organizational activities. There are some key social and cultural factors which are the women’s fertility rate, the rate of marriages, divorces and birth rate, and so on.

Technology environment in addition to inspect with the activities of the business in the area in which technical are directly related to the development and changes, we must also keep abreast of: the national investment in technology development and support focus; technological developments in the field and the total cost of R&D impact of technology transfer ; and the protection of the patent, and so on.


Organization structure refers to how the division of tasks, group, and coordination and cooperation. In other words, that is the guidelines to drives an organization in dividing the certain responsible aspect in order to achieve its goals. While accomplish the goals of the organization, it seems that the more efficient operations is needed and it is directly related between areas and the individual.

In other words, the concept of organizational structure of the broad and narrow sense. Narrow organizational structure refers to in order to achieve organizational goals, in organization theory, under the guidance through the organizational design organization formed within the various departments, fixed between all levels of the arrangement, the organization within the form. Broad structure, in addition to the organizational structure that contains the contents of the narrow, but also the relationship between organization type, such as specialization and cooperation, economic associations , business groups and so on. There are six elements of organizational design that we must consider which are work specialization, departmentalization, chain of command, span of control, centralization and decentralization, formalization.

According to Henry Ford’s experience shows that the staff engaged in specialized work, their productivity will increase. Today, we use specialized work ( work Specialization ) the term or the division of labor organizations such words to describe the task is divided into several steps to complete the refinement. The essence of the work of specialization: a person is not a task to complete all, the solution into several steps, each step by a person independent to do it. In the terms of its substance, as part of work activities, but not all activities. Through the introduction of specialized work, the management also sought to increase organizational efficiency in other areas. By repetitive work, the skills of employees will be increased, in work tasks or work to change the course of installation, demolition tools and equipment will reduce the time spent. Equally important, from an organizational point of view, the implementation of job specialization, training helps to improve the efficiency of the organization. Selection and training in specific, repetitive tasks of the staff easier, costs are lower. For the operation that highly sophisticated and complex work in particular.

Once the work of specialized sub-tasks, the need to group them by category so that the common work can be coordinated. Job classification is based on departmentalization. Classification of work activities are mainly based on the activities of functions. Manufacturing through to project managers, accounting , manufacturing, personnel, procurement and other experts in the department is divided into a common organization of its factories. Only changes in the functions of the organization to reflect the objectives and activities. The main functions of the department of a hospital may have a research department, nursing department, accounting department, and so on. The professional football player may set up the Ministry of Personnel, ticketing sector, travel and logistics sector. The functions of the main advantages of grouping method, the same experts, together, can improve efficiency . By sector of functional expertise, research close to the people assigned to the same sector, to achieve economies of scale.

The concept of chain of command is the foundation of organizational design , but greatly reduced its importance today, but in deciding how best to design organizational structure, managers still need to consider the significance of the chain of command. Command chain is a continuous power line extended from the highest level of organization to the lowest level, to clarify who is reporting to whom. In discussing the chain of command, you should first discuss the two complementary concepts: authority and unity of command . Authority is inherent in management positions in an order and expect the power command is executed. To facilitate collaboration, each of management positions in the command chain has its own position, every manager for the completion of their duties and tasks, should be granted a certain authority. Order unity ( Unity of command ) will help maintain the authority of the principle of continuity of the chain. It means that a person should be a supervisor, and only directly responsible for a charge. If the destruction of the unity of the chain of command, a subordinate may have to struggle with one or more competent, or the conflict between the different commands the choice of priorities.

The problem or span of control is very important because to a large extent, it determines how many levels of organization to set up, with the number of management staff. In other conditions, wider span of control, organizational efficiency higher, as can be exemplified.

Centralization consider as the distribution of decision-making power.

In some organizations, decision-making is highly centralized; and in some other organizations, decision-making power was granted to the lower staff, this is called decentralization. Whereas formalization is refers to the organization to rely on rules and procedures to guide the extent of employee behavior.


The tall organization structure shows a narrow span of control, is the organization structure with multiple level of management and has a strict management and clear division of labor, the characteristics of higher and lower levels easier to coordinate. The tall organization structure has an extended vertical structure with well-defined but long reporting lines. Time for management increased, the equipment and the expenses that spent in the management will also increase. Management level increases, the communication and exchange of views up and down blocked, the most senior executives to achieve the required staff, the policies and plans, this may influence the understanding of the lower and the information from the higher to the lower is not accurate sometimes. In other words, the number of different levels may cause communication breakdown and slow decision making. The increasing levels of management, the top management of the underlying difficulties in the control variable, easy to create a flat overall rupture, at the same time as strict management, there are impact of lower-level people’s initiative and creativity. Therefore, in general, in order to achieve effectively, management levels should be reduced as much as possible.

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