How are selling instruments (HP's traditional business) different from selling computer systems?
The test and measurement business (instruments ? HP's traditional business) provides standard and customized solutions. In 1999, HP spun off its traditional business and incorporated Agilent. It sells its products through direct sales, distributors, resellers, manufacturer's representatives, telesales, and electronic commerce (Yahoo Finance 2005). While some instruments are seen as commodities it is important to distinguish your products against competitors. You must detail and communicate the important ways your offering differs from your competitors. HP offers related services around their instruments, but in the start they primarily marketed their products on the basis of technological features and acted as a product vendor. Today, instruments and measurements systems are not that different. You measure what you measure and that is it. There are standard ways to measure different things, but as the new measurement systems are getting extremely advanced and specific ? you need to customize to a certain degree also. One can provide standards for different sectors i.e. measurement systems for the telecom sector vs. the financial sectors. However, HP sits on substantial technical specific know-how on measuring technologies, but they are the one who knows how to adapt to certain sectors. It is important for them to lock-in the technical core and protect their knowledge. So, we mean that when the technical specs were not as advanced as today, the instruments were "more" commodities, but in the last decades it as increasingly shifted to a solution provider than a plain commodity vendor.
When we look at computer systems ? these solutions are highly customized to many cu ...