Is Perception Reality?

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Diane Krakora – CEO, Amazon Consulting

My mom called last week asking me to go computer shopping with her. Now, I love shopping, so I’m inclined to grab my keys immediately, however I kinda remember buying her an HP Omni system just two Christmas’ ago.  Did she use the CD-ROM drive as a cup holder again?

When we finally connected live, she voiced she knew HP was going out of the computer business and thus she needed to move her HP computer onto another brand. Whoa!  “It’s true”, she said, “I saw it on Maria Bartiromo.”  Double whoa!! For one, I didn’t know my mom watched “The Final Bell” and two, she has WAY too much time on her hands.  I calmly explained three times that HP was only considering the divestiture of its personal computer businesses. By no means did she have to discard her perfectly good desktop system.

Unfortunately for HP, it sounds like the public perception purported by the media is that HP is dumping their PC business. The communication of exploring either a spin off or an acquisition leaves the impression that HP doesn’t want to be in the PC business anymore.  That has 74 year-old ladies concerned about their computers’ future.

It doesn’t matter, the reality is the PC business is cash intensive at critical times – back to school and Christmas – and margins are being squeezed and the PC business is languishing from the economic downturn. And as HP re-invents itself with Leo at the helm, they are examining the PC business. Shouldn’t companies examine all underperforming pieces of their business regularly to optimize shareholder value? It is unfortunate a story was leaked in the press, which has lead to the public perception that HP is terminating its involvement in the PC business – which would likely thrive, but in a different form. Will public perception turn HP’s PC end-of-life considerations into a reality?

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