HP may offload parts of outsourcing business

Hewlett-Packard may close down or sell parts of its outsourcing division to focus on higher-margin areas of its technology services, according to reports.

Sources told Reuters that HP executives are considering divesting departments including business process outsourcing (BPO), which provides back office support to clients. HP’s India operation is also said to be at risk of closure or sale.

HP, which reportedly refused to comment on the story, sees BPO as a low-margin business that is not essential to its growth plan, Reuters’ sources said. However, execs could still decide to hold on to the department if it fails to attract a high enough offer, or keep aspects of it relevant to the company’s software and hardware offerings.

Last week former Wal-Mart executive Linda Dillman was appointed senior vice president of global information technology, responsible for leading the IT teams that support HP’s outsourcing services business.