Here's what you need to know: The Compaq Computer Company, founded in 1982, experienced remarkable growth in its early years, quickly becoming a major player in the PC market. Starting with $111 million in revenue in its first year, Compaq's success continued with rapid increases, reaching $1.2 billion by 1987. Key to this growth was their ability to produce compatible computers that appealed to businesses, as well as a faster product development cycle compared to IBM. This agility allowed Compaq to bring new technologies to market ahead of its competitors. However, Compaq's dominance began to wane due to rising competition and failure to innovate independently. They relied heavily on external partners for critical components and missed early opportunities in emerging markets like laptop computers. As other companies began producing more powerful and cheaper clones, Compaq struggled to maintain its premium pricing strategy and was slow to react to market changes. The situation worsened in the early 1990s as economic downturns and a lack of strategic agility led to declining profits and leadership changes. In response to these challenges, Compaq attempted a turnaround strategy focused on volume sales and price reductions under new CEO Eckhard Pfeiffer. This initially yielded positive results as revenues surged to $4.1 billion in 1992. Nevertheless, a series of acquisitions intended to expand Compaq's services proved problematic, ultimately distracting from their core PC business. By 2000, mounting pressures from competitors like Dell and shifting industry dynamics compelled Compaq to merge with Hewlett-Packard, leading to the end of its independent identity. In conclusion, while Compaq played a crucial role in revolutionizing the PC industry, its story serves as a cautionary tale about the importance of innovation, adaptability, and strategic foresight in maintaining competitive advantage.