REVENUE STRATEGY - HEWLETT PACKARD

1. Hewlett-Packard, the biggest personal-computer maker, launched Innovation Program Office in 2006 to help buy hip, nimble startups for its huge Personal Systems Group and inject big doses of the small companies' creative juices directly into the HP culture. Startups are even providing HP with a new customer-based system that accelerates product development in other divisions.
2. It has learned how to (a) develop cool, high-margin products that appeal to new consumer groups such as video-game fanatics; (b) use social media to conduct Web-based consumer research; and (c) inspire engineers in HP Laboratories to turn concepts into products faster.
3. Its businesses (computers, printers and imaging machines, storage devices and servers, and info tech service) have shifted their focus from developing cool technologies to making products customers want.
4. It is trying to market personal computers today as being friendly, not just fast and powerful.
5. It is not just selling fast printers, but pitching terrific printing experiences.
6. It has developed the HP Blackbird 002 personal computer as the first fruit of acquiring Voodoo, a fan-based, gamer-driven PC company. The Blackbird is so user-friendly that consumers who want to customize it themselves can do so without using tools. It takes 10 seconds to replace or upgrade a hard drive. It's powerful and fast with room for five hard drives to accommodate rich graphics.
7. Its Snapfish Labs has boosted the rate of customer-focused innovation because consumers can weigh in early on potential HP products.
8. Its acquisition of Tabblo, acquired in 2007 suddenly injected a Web culture it never had before. Tabblo signed the contract and released its Flickr service in only six weeks—vs. an expected three to four months.
9. Its new strategy is innovation via absorption—infusing the acquirer's culture with the target's culture. It isn't business process re-engineering. This is a fundamental shift in the culture of an organization.

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10. It has leaned on a network of more than 100,000 retailers to help sell PCs, particularly the notebook models favored by consumers.
11. It has spent more than $6.5 billion on six acquisitions to bolster returns in software and turn a money-losing unit two years ago into HP's fastest-growing business.

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