The ranting of an IT Professional

Feb 20 2009   2:44PM GMT

HP cutting wages



Posted by: Jason Tramer
Tags:
EDS
HP

You can read the full story here:

http://www.theregister.co.uk/2009/02/19/hp_pay_cuts/

However I just wanted to add my two cents to this story. I think bad quarterly earning reports are to be expected for most hardware vendors at this point. The truth is that HP really needs to diversify their business a bit into the service industry.  From what I understand the industry magic number is 30/70. Thirty percent service revenue and 70 percent sales. Now obviously HP understands this and that’s why they bought EDS, however rather than cutting employee pay which will pretty much guarantee they will loose some of their best people, they should really focus on some heavy lay-offs on the EDS side and then amalgamate the business.

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