Is 378 - Hewlett Packard

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general manager of the DMD (Christensen, 2006).

The DMD was based in Boise, Idaho. In 1992, their disk drive sales brought in 519 million in revenue. Although small in comparison to other disk manufacturers, DMD still had a profitable niche in the market which contributed to HP’s overall 16 billion in net revenue (Christensen, 2006).

Project Overview

Bruce Spenner, often wondered why HP was not a leader in the market and was no longer satisfied with being a niche player. Spenner set his sights on becoming a major leader in the marketplace by controlling 20% of the market share (Christensen, 2006). To do this, Spenner felt the DMD need to go beyond what was already being introduced and used in the market by its competitors. The DMD needed to come up with a new innovation to compete with the market top leaders, such as Conner and Quantum (Christensen, 2006).

Spenner’s reputation for being a visionary and a risk taker prompted him to create a new design for a 1.3-inch disk drive architecture, something which would take advantage of the increasing role of desktop/laptops. They were more frequently being used as client computers in larger company databases, with the notebooks, PCs, and even handheld devices being the end user interface. All of these, naturally, required microprocessors.

In May 1991, with the support of Dick Hackborn, Executive Vice President of Computer Organization, the project was greenlit, giving Spenner ample freedom, resources and engineers from the DMD to start the project, titled Kittyhawk. The project was given the financial freedom to create a 1.3- disk drive because HP felt the investments could be recovered from the profits of the other successful DMD products (Christensen, 2006).

The project was led by a contract that simply stated the goal of the project was to “Build a small dumb, cheap disk drive!” (Christensen, 2006). There was no market testing or analysis of what the market needed. The goal was to simply create a cheap disk drive. This left the project prone to more risks.

Scope

Objectives

The overall proposal for the project was to become a leader in the market plan by creating a leading product in a 1.3- inch form factor. The DMD intended to take advantage of what they thought was a growing mobile computing market and ultimately seek to sell their disk drive for $49.95. The price point was to be achieved through high volume manufacturing (Christensen, 2006).

The idea to focus mainly on the mobile sector was built behind what was the “next big thing,” or specifically personal digital assistants (PDAs). The market for this product was undefined, therefore leaving the Kittyhawk team with no market research on how to tackle this sector. With limited information on how or if this market would grow, the project team created their own aspects for what PDAs may want in a disk drive. Some of these aspects included having more megabytes per square inch, drop resistance technology, and flash memory (Christensen, 2006).

An eventual objective came to create a hard drive which could accommodate the HP Corvallis Division needs in a subnotebook, who could also use the newly Kittyhawk disk drive.

Requirements

The requirements for the final product included the following:

Introduce the Kittyhawk disk drive within the next 12 months

Break even on cost in less than 36 months

Achieve 100 million in revenue within 24 months

Achieve revenue growth of 35% to ensure they were an industry leader

Ensure that the drive could withstand a drop of 3-ft on concrete without data loss

Be the first 1.3-inch disk-drive on the market

With the financial backing from the DMD, top management support, and the freedom to make any decision possible to create a disk drive that could accomplish these requirement, Spenner felt the team could reach their goals.

Assumptions

For this project to work, a special team was needed. Aside from experience and technical skills, team members needed to be risk takers to design something that had no clear path. Per the textbook, Information System Project Management, experience is only one aspect for forming an effective team; motivation and desire to finish the project are also important (Avison & Torkzadeh, 2009). Some of the team members weren’t necessarily experienced, but were willing to take on new avenues.

The project team came up with some possibilities for where the 1.3-inch drive could go; mobile information technologies, communication technologies, consumer electronics, automotive electronics, and some new developments in standard computer technology. PDAs were thought to be the largest emerging market.

The project was projected to be successful based on the projection of the PDA market and the need for small storage devices. If the research about the expected growth in the PDA market was correct, then the need for a 1.3-disk drive would grow immensely, thus achieving all their goal of being the first 1.3- inch drive on the market. By getting a “jump” on this section of the market, they thought they could achieve the 100 million revenue rate, which was three times higher than originally expected (Christensen, 2006).

The Kittyhawk disk could also be used in other markets that did not need all of the specifications, such as ruggedness. They had a general impression of commitment from Nintendo, who showed interest in small storage devices by giving them an indication of how many cartridge units they shipped during the holidays (Christensen, 2006).

The assumptions only made the team feel as if there were many avenues to help achieve all the goals HP wanted from the project. It further proved to them that the project could be a success because there seemed to be a definite need for a 1.3-inch drive in the market.

Constraints

The limitations from the project came from not having clearly defined target markets. Without a target market, the team was simply creating what they thought could be used in the future versus what the customer wanted (Project Management: How to define Project Constraints). Some limitations included:

Ignoring