Texas Instruments and Hewlett Packard

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Texas Instruments and Hawlett-Packard

Strategic planning systems
Texas Instruments is more diversified company, whereas, Hawlett – Packard single industry with related diversified firms. That is why we suggest TI to use vertical strategic planning system. Business units prepare strategic plans and submit them to senior management to review and approve. For related diversified and single industry firms, like HP, tend to use both vertical and horizontal. The horizontal dimension might be incorporated into the strategic planning process in a number of different ways.
Moreover, tend to create new markets and exited as a cost- driven competitors entered and the market matured. In consequence, for HP importance of strategic planning is very high due to uncertainty of environment in a “build” strategy. However, Texas Instruments favored early entry, followed by expansion and consolidation of its position, resulting in dominant market share when the product matured. So, for TI importance of strategic planning is relatively low due to stable environment.

Budgeting systems
For Hawlett – Packard role of the budget is short-term planning tool, whereas, for Texas Instruments is control tool. HP is concentrated on more flexible production processes to meet the needs of its custom and low-volume markets, while TI concentrated on more capital-intensive and cost-effective production processes to supply its more standard, high-volume markets. For HP, this implies relatively high control limit used on periodic evaluation against the budget. However, for TI, the control limit used is relatively low.
Meeting the budget is not an issue with HP since the budget might be modified during the fiscal year. However, for TI, meeting the budget is very important as this measures the company’s efficiency.

Reporting systems HP is concentrated more on reporting the policy issue as…...

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