Verifone Case Study

Summary
Verifone was founded in 1981 as a check verification company. The company experienced tremendous growth over the next 10 years and became the global leader in electronic payment solutions. During this period Verifone grew from 25 employees to 1,800 with sales approaching $300 million. Additionally, in 1996 their revenue increased to $470 million, and achieved a profit of $39 million. Verifone’s products were installed in over 100 countries and completed more than 5 million transactions per year. Hewlett Packard acquired Verifone on June 25, 1997 for $1.29 billion. However, the acquisition was not as productive as expected. Verifone lost its number one position in the world after four years and was failing to turn a profit. Under Hewlett-Packard, Verifone Managers were not empowered to make the changes they needed to make. H.P's structure (The Green Sheet) was too bureaucratic and there was no flexibility and fiscal discipline. This culture led to the exit of many of the th...