Hp Fly of Kittyhawk

Hewlett-Packard:

The Flight of the Kittyhawk (A)

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Business Strategy

Professor Barry Karafin

The first hard drive, a magnetic information storage and retrieval device for computers and other electronic products, was developed by IBM engineers in 1956 in San Jose, California. This hard drive was the size of two side by side refrigerators and could store 5 MB of information. Incredible technological progress ensued, and by the early 1990’s, disk drives had decreased from their original bulky configuration to 2.5 square inches in diameter and had a four-fold increase in their data capacity to 20MB. The disk drive business had grown into a multi-billion dollar industry marked by frequent innovation, rapid growth and intense competition amongst a few select firms such as IBM, Seagate, Conner, Quantum, and Western Digital.

These technology manufacturers competed in the hard drive market by relentlessly pursuing two design improvements: reduction in physical size and increase of data storage capacity. These advances were required by their customers, who were in an analogous race to bring smaller, cheaper, and higher utility electronics to market.

At this time Hewlett-Packard’s (HP) Disk Memory Division (DMD) held a small but profitable piece of the market with its high-performance, high-capacity 5.25- and 3.5-inch disk-drives. Wanting DMD to “become the next printer business for HP”, the group’s management seized the opportunity to grow by attempting to leapfrog the competition. In June 1992, twelve months after assigning the task to an autonomous project group, HP introduced the world’s smallest hard drive. Named Kittyhawk, the 1.3-inch diameter drive had 20MG of storage, the durability to withstand a 3’ fall, and low power consumption. These advantages made the drive seemingly ideal for applications in the burgeoning mobile computing market as well as for increasingly thinner laptops, gaming devices and other new products. The HP...