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  • Main Subject - Channeling HP - Hewlett Packard Bests Dell in Retail

    I like to pick on HP more than most people, so it is odd I now must praise them.

    Back when I was on the other side of the B2B technology exchange, I was primarily an HP customer. I r
    According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
    an shops with multiple minis of varying HP operating system flavors (RTE, MPE, HPUX) and thus had a deep love/hate relationship with the company. To this day I keep a number of HP exe
    ; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

    Examples of combination products may in
    cutives in my virtual Rolodex and hound them when necessary or advantageous.

    For a long time it appeared that HP's PC business was going to go the way of IBM's, namely "out the door."
    lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

    Sales were weak, and the fatter margins promised by the Compaq merger were not evident. HP went toe-to-toe with Dell, attempting to clone their success without ever coming close. Ma
    here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
    ss customization was not something HP was going to be good at, and like all things Carley inspired, was heading for the technology sewer.

    Two things happened at about the same time th
    d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

    Combination pro
    at changed HP's PC fortunes. First the market changed. Dell was the PC king when mass customization was demanded by the market. Keep in mind that Dell grew during the period when PC
    ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
    were fragile, components were expensive, and building system to order allowed consumers to get what they wanted without overspending. Michael Dell saw the weakness in the market (inc
    easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
    ompatible system, limited store selection, and high prices) and made a business out of eliminating those problems for the consumer.

    But the market changed, to which HP responded and D
    nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
    ell did not. First, components became more standardized and the price of components fell through the floor. My bookkeeping system reports that I gave Dell $3,500 back in 1998 for wel
    and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
    loaded desktop. Today a server grade desktop with a quad processor costs around $2,000 at CompUSA. This is due primarily to standardization, which kicked a key differentiator out fr
    ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
    om under Dell. Take away the need for mass customization, and you remove mass sales.

    About the time this market shift occurred, HP installed Todd Bradley at the helm of their Persona
    ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

    Following aspects would a
    l Systems Group, that included oversight of PCs. Todd came from Palm, an outfit that had both good direct sales and retail sales of consumer products. Todd understood that PCs were n
    dd to the challenges in developing combination products:

    Which markets to tap where the combination products can do fairly well?
    Which combination prod
    w over configured for the average user, meaning that most users didn't require customization or many feature tradeoffs. Consumers needed competitive prices and instant gratification,
    cts are meaningful and rational?
    Which therapeutic categories to select?
    Which Combinations can address unmet needs of the patients?
    Do combin
    which can only be had at a retail outlet. Soon thereafter the shelves of every office supply and computer store were filled with HP hardware. The prices were low, the features compet
    tions increase the patient compliance?
    What would be the developing cost?
    How to tackle the risks encountered during combination product developmen
    itively rich, and you could take it home today.

    IBM never saw this opportunity because IBM is IBM, and makes it's money selling expensive gear to enterprises. Today HP is happily sch
    t?

    As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
    zophrenic, selling both enterprise and consumer technology goods. It took time, and it took getting consumer marketers like Bradley into the mix. Recent news shows Dell playing catch
    ping new procedures for reviewing their safety, efficacy and quality.

    Professional from academic institutions, pharmaceutical industries, health care indust
    -up and elbowing their way onto retail shelves, sadly by fishing on the bottom of the lake by peddling through Wal*Mart ("Hey, honey, fetch me a 12-pack of BVDs, some shotgun shells, a
    y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
    nd a Dell Core Duo" ). Though not abandoning their direct sales model, they have a bit to learn about resurrecting a brand that suits retail sales, as well as manufacturing to meet th
    .

    As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
    perpetual feature/price crush of the PC market. I would bet they do well, but HP now has the commanding lead and Dell has an uphill battle ahead.

    The marketing take-away is this: ma
    elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

    Companies that provide selfless information through particip
    rkets change, and complacency kills. Recognizing a shift in your market, and acting on that shift is essential to staying alive. No market is static, and neither are your competitors


    tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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