The illustrious Hewlett-Packard technology firm is going to split into two different companies – one specialized in its computer and printer manufacture, and the other producing its corporate hardware and services. However, is this split completely advantageous? Although the split is aimed at improving HP’s adaptability to the market, the company will lose significant economies of scale and scope. Moreover, the loss of thousands of jobs threatens a major social cost in an economy which seems to have begun recuperating from the 2008 recession.
See if you can identify the different economies of scales and scopes lost, and any other costs. Try and come up with your own evaluation on whether HP should split.
Bigger isn’t better (including other company’s who have split)