Ms Carly Fiorina, chief executive of Hewlett-Packard, is not just a new broom. Since she joined the computer and printer company in July, she has been racing through the corridors of its worldwide operations, searching out dusty corners of inefficiency.

Ms Fiorina has left nobody in doubt that change is the order of the day. Of HP's vaunted corporate culture - which stresses the advantages of autonomous business units and rejects traditional corporate hierarchy - she says her goal will be to "preserve the best" and do away with the rest.

Her challenge is to sharpen HP's competitive edge and to improve its recent lacklustre financial performance. In the latest fiscal year, ended October 31st, HP's revenues from continuing operations grew by just 7 per cent.

That is a snail's pace compared with the 20 per cent growth recorded at Sun Microsystems, HP's main rival in the high-performance computer sector. IBM, the world's largest computer company, increased its revenues by over 12 per cent during the first three quarters of 1999.

HP's earnings growth has also been mediocre. Over the past five years, earnings have grown at an average rate of 15.1 per cent, against an industry average of 25.6 per cent. Wall Street analysts are predicting a decline in HP's earnings in the first half of fiscal 2000.

Ms Fiorina makes no secret of HP's problems, most of which, she implies, are of its own making. The company's decentralised approach to management has created duplication and inefficiencies, she complains.

In a significant change, she realigned the company's operations into four divisions - two that are "customer focused", and two encompassing the company's broad computer and printer product lines.

This "matrix management" approach has fallen out of favour at many large companies, yet Ms Fiorina sees it as the way to ensure that HP puts more of its energies into meeting the needs of customers, and balancing its engineeringled preoccupation with product development.

The new structure also ensures that divisions are interdependent, which she believes is vital.

"We have a lot of soloists in this company and what we need is an orchestra," she says. Her favourite example of the inefficiencies created is that HP has no fewer than 750 internal websites for employee training. "Now why do we have that?" she asks.

The answer is that HP's business units have all created their own training programmes with little thought given to leveraging the efforts of other parts of the company. Ms Fiorina has launched a $200 million corporate marketing campaign - the first for HP in more than a decade - that will replace much of the advertising traditionally controlled by product divisions.

Yet internal websites and advertisements are just the tip of the iceberg. The independence of product divisions is deeply ingrained in HP's culture. It goes back to the company's founders.

Bill Hewlett and David Packard "feared the downside of big", says Ms Fiorina, "and appropriately so. Sometimes that independence and ability to move quickly is a good thing. But it's not a good thing when we diminish our power in the marketplace. It's not a good thing when we're spending more money than we need to and not getting enough bang for the buck, and its certainly not a good thing when we're confusing our customers."

Ms Fiorina is now grappling with a problem that is common among leading high-technology companies - how to be big, yet nimble; efficient yet responsive to rapid changes in the marketplace. Ironically, she is doing so at a company that many industry observers thought had created the model for avoiding such problems.

So far, Ms Fiorina appears to have the support of HP employees. She has been well received during her whirlwind visits to HP's worldwide facilities, where she has tried to strike a balance between acknowledging accomplishments and demanding better performance.

However, even as Ms Fiorina is working to boost employee morale, she is planning job cuts.

Speaking to Wall Street analysts last week, Mr Bob Wayman, chief financial officer, said the company would reduce operating costs by $1 billion a year, within three years. Although much of the savings will come from rationalisation, there will be some workforce reductions, he acknowledged.