HP hit the news with its breakup following eBay/Paypal, and there are even rumors of Cisco.
Given that Hewlett-Packard is already bifurcating itself into an enterprise company and a PC-and-printer vendor, eBay is breaking out PayPal as a separate entity, and Elliott Management is pushing EMC to spin out VMware, it’s clear that big companies are under tremendous pressure to “maximize shareholder value” by breaking themselves apart.
The main focus on what most people write is how much better it is financially to split the companies up. So is that the only reason to split, because financially it is a better deal?
One thing a split does is there are going to be massive changes in the organizations. Who is responsible for what. How big do teams need to be. If economies of scale worked perfectly, then it should be less efficient to be split. Too many times the way things are done is people protecting their territory. When your territory is split in pieces you can’t say no don’t split my group up. You will split and be a participant or we will add you to the list of people who should be part of the layoffs. Oh, yeh, I am totally supportive of the split. Count me, and keep my job.