Next time Mark Hurd makes a public-speaking appearance, he might start by lifting that signature line from Lou Gehrig's farewell speech about being the luckiest man on the face of the earth.
I'm not out to belittle Hurd or dismiss what he's accomplished. Besides, after yet another stellar quarter from Hewlett-Packard, I probably belong to an increasingly small minority when I say he's yet to prove himself.
No doubt that few on Wall Street believe HP's recent performance has anything to do with luck. They've adored Hurd ever since he revived NCR. He cut costs, turned money-losing divisions into profit makers, and more than doubled NCR's stock price. Disenchanted investors hoped Hurd could similarly reverse the serial disappointments that marked the Carly Fiorina era. Since moving to HP in early 2005, he's won rave reviews thanks to the 75 percent improvement in the company's stock.
Whether any other hard-charging female CEO taking a needed blowtorch to the joint would have fared better is anyone's guess.
And so the new mythology being spun is that HP's good fortunes are all due to Hurd's Herculean effort. If it were only that easy.
Unfortunately, the press has gone along for the ride. We've trotted out all the predictable cliches in our arsenal to explain the reasons for HP's brighter outlook. To wit: Fiorina was the glitz-addicted, globe-trotting megalomaniac who couldn't admit to her own shortcomings as an operations manager. In contrast, Hurd is the anti-Carly, the taciturn Midwesterner who shuns the limelight, a dogged, number-crunching, ubermanager who can squeeze money out of a stone. (Don't forget to say the last clause out loud in a deep, manly voice.)
The familiar list of particulars on Fiorina's rap sheet features a poor management style, an ill-considered acquisition and an indifference to HP's supposedly special corporate culture, a particularly nurturing environment for collaboration.
Fiorina clearly failed to manage HP's far-flung divisions. She needed a strong No. 2 to free her up to do the vision thing and glad-hand customers. Michael Dell has Kevin Rollins, Larry Ellison had Ray Lane and Scott McNealy had Ed Zander. HP did have a good candidate in the person of former Compaq CEO Michael Capellas, who stayed for a brief period after the merger transition. But he left to run MCI. That was HP's loss. The company took expenses out of its infrastructure post-Compaq, but not fast enough. Capellas was better than Fiorina at operations and would have made a big difference.
Postmerger missteps also cost HP its lead in the PC business. It was No. 1 in 2002 but has slipped to second place behind Dell.
But credit Fiorina for pushing a deal which, years later, is bearing fruit. Even though the results were slow in coming, Compaq brought along a lot of good technology. Even professional Carly bashers will acknowledge that without Compaq's PCs and servers on board, HP wouldn't be selling much these days except printers and Itanium servers.
Hurd's HP also benefited from a surging economy. It was Fiorina's bad fortune to be at the helm when the dot-com bubble burst and a recession chilled IT spending. Consumer and retail demand--two areas where HP is stronger than Dell--have since rebounded, but these are fickle markets. And if the commercial market revives and Dell returns to its normal growth rate, the momentum easily could shift the other way.
And how about that special corporate culture? Sorry, but the folks at HP mourning for the days of Bill Hewlett and Dave Packard never gave Fiorina a fair shake. She was too brusque, too much of an outsider and--let's face it--just too brassy to suit their tastes. This was a company in need of a jolt. Whether any other hard-charging female CEO taking a needed blowtorch to the joint would have fared better is anyone's guess. And as for that oh-so wonderful collaborative environment, it didn't add up to very much. When it came to turning out exciting computer products, HP was a follower, not a leader--unless you want to count the number of do-nothing jobs that should have been eliminated years ago.
A new CEO and a new attention to detail have done wonders for HP in the last year. But a rush to judgment on HP current and former bosses fails to do justice to either. If Hurd is as modest as his handlers claim, he would be the first to recognize that HP's achievements owe a debt to his predecessor.
Biography Charles Cooper is CNET News.com's executive editor of commentary.
Let's paraphrase here. Mark Hurd should make a huge point at his next public speaking event that he's lucky, and he has yet to prove himself. His success is described in predictable cliches by an uncritical press, and his 75% improvement in the stock price is care of the economic upswing.
Not so sure he isn't out to belittle Hurd, here. Rather disingenous, methinks. Yes, some good points are made, but the tone is one of somebody aiming to justify their own opinion. Rather than implicitly criticise Hurd for being insufficiently modest on the basis of what the *press* are saying, Mr Cooper might be better advise to hunt down the interviews Hurd has already given acknowledging that much of what he has done is building on things decided before he even got there.
Incidentally - I do work for HP, but joined at the same time as the Compaq acquisition. Most of the criticism of Carly seemed justified. Shaking things up or chasing the "big deal" that will make your mark is easy - running a good business at that scale is not. CEOs of multi-nationals should not act like headstrong sales people.
ONe wonders if you even read the piece. It was not meant to criticize Hurd. Nor to praise Fiorina (a more interesting point is why one automatically refers to the male by his last name and the female by her first.) It was to point out to OTHER people who do either that it is premature to pass judgment. As such, nothing in anything you wrote is even remotely relevant.
Another from-left-field Charles Cooper editorial posing as meaningful text. Hurd has obviously done a good job, and the case proves (once again) that a marketing person can't run a company.
I have a number of friends at HP, and they agree with your analysis completely.
My company is a major HP Non-Stop software VAR. The purchase of Compaq (and hence, Tandem) was the greatest thing ever to happen to the Non-Stop division. NED now collaborates with the HP-UX crowd, especially on key technologies like Java, and the Itanium Non-Stop is based on the RX46xx motherboard, with an oh-so-important daughter board to support double and now triple redundancy. (Think, 7 9's!) They have reduced their costs and improved their offerings, and this all occured on Carly's watch. The Non-Stop has been pulled back from the brink. That is innovation and collaboration at its best.
Uh, so are these "HP insiders" part of the old Compaq? Not that all those things you mentioned aren't good stuff, but it's just a small slice of the overall picture. I guess I mainly take issue with your subject title. In my experience working 14 years in the printer division, a more accurate subject title would be "Few HP insiders agree".
What pluperfect nonsense. Cooper has used every spin technique in the book in this "Me Love Carly" valentine. He applauds the Compaq merger even though it was announced almost five years ago. It didn't help the company while Fiorina was there; no one thought it was going to pay off anytime soon when she got whacked (February of 2005). 18 months after her departure, after significant changes were made, it's starting to return some value-- not pay for itself, but just stop bleeding money. And it's paying off in areas that Fiorina didn't anticipate. But Cooper thinks she deserves full credit for the brilliant move.
Fiorina set four goals for the merger in her letter to HP employees (you can find a link to the letter on this site):
1. "Extend our lead as the #1 leader in imaging and printing."
2. "Extend our lead as the #1 consumer IT solutions company in the world."
3. "Catapult HP into the #1 small- and medium-business IT solutions company."
4. "[Give] IBM a competitor... in the enterprise space."
I'd give her 1 1/2 of those points-- and the one that has worked is the one she listed last and soft-pedaled. Her stated goal was to beat the daylights out of Dell. That failed dismally (although Dell is trying to help make it work by imploding-- or should I say 'combusting'?).
Cooper also bemonas her terrible luck-- Michael Capellas could have helped HP a lot if he hadn't been very mean and quit. Actually, Fiorina forced him out, because she saw him as a threat.
Also, the wicked old economy went and got bad on Carly all of a sudden. Cooper apparently doesn't think that strategic plans should take economic forecasts into account. It was obvious, as early as 1999, that the dot-com bubble was going to burst fairly soon, and that companies would need to be very careful about spending mergers. Fiorina blithely ignored the signals.
Cooper also doesn't mention the failed PWC merger-- where she was going to overpay dramatically for a service building. It would have have bled HP of cash-- but the HP board thankfully got cold feet and pulled the plug.
It's easy to conclude that someone is underappreciated if you ignore all their bad points and make up good ones.
When Carly came to HP she was greeted with enthusiasm, along with the changes she brought. But behaving like a billionaire playgirl on the company dime while slashing benefits started people mumbling. Then she started blaming the employees, who'd been busting their *****, for the lackluster results of her initiatives. Then there was the ugly proxy battle over the Compaq merger where she got into a public mudslinging campaign against a respected board member. Then there were the ambush layoffs. She earned the resentment of the HP employees.
As for any positives inherited by Mark Hurd, I think you have to give a lot of credit to the ability and commitment of the underlings who stuck it out during Carly's mis-management.
As for benefits from the Compaq merger, that's difficult to judge. HP's not really much better off in the PC market now than before the merger, and certainly nowhere near enough to make up for what it cost in stock value. Could it pay off eventually? Maybe. But it's not at all clear that anything Compaq brought couldn't have been accomplished by HP on its own, especially considering Compaq's trajectory at the time of the merger.
Prominent corporate governance organization says Facebook's dual-class stock structure gives CEO Mark Zuckerberg too much control over the company's future.
Google creates an animated doodle that features a boy, a girl, Google's search engine, and a jump rope. But might there be darker, more analytical, more troubling interpretations to this tale?
When the sun goes down, that's when the iPad gets busy for folks with news readers. The iPhone? It's more of a daytime habit. If you're building an app for both devices, heed the lesson.
EnerG2 opens a plant to make an engineered carbon that will improve performance of energy storage devices and make storage for start-stop hybrid cars less expensive.
Not so sure he isn't out to belittle Hurd, here. Rather disingenous, methinks. Yes, some good points are made, but the tone is one of somebody aiming to justify their own opinion. Rather than implicitly criticise Hurd for being insufficiently modest on the basis of what the *press* are saying, Mr Cooper might be better advise to hunt down the interviews Hurd has already given acknowledging that much of what he has done is building on things decided before he even got there.
Incidentally - I do work for HP, but joined at the same time as the Compaq acquisition. Most of the criticism of Carly seemed justified. Shaking things up or chasing the "big deal" that will make your mark is easy - running a good business at that scale is not. CEOs of multi-nationals should not act like headstrong sales people.
criticize Hurd. Nor to praise Fiorina (a more interesting point is why
one automatically refers to the male by his last name and the
female by her first.) It was to point out to OTHER people who do
either that it is premature to pass judgment. As such, nothing in
anything you wrote is even remotely relevant.
Carly Fiorina was lucky, thousands of HP employees were unlucky. How do you define Carly's Way?
My company is a major HP Non-Stop software VAR. The purchase of Compaq (and hence, Tandem) was the greatest thing ever to happen to the Non-Stop division. NED now collaborates with the HP-UX crowd, especially on key technologies like Java, and the Itanium Non-Stop is based on the RX46xx motherboard, with an oh-so-important daughter board to support double and now triple redundancy. (Think, 7 9's!) They have reduced their costs and improved their offerings, and this all occured on Carly's watch. The Non-Stop has been pulled back from the brink. That is innovation and collaboration at its best.
Fiorina set four goals for the merger in her letter to HP employees (you can find a link to the letter on this site):
1. "Extend our lead as the #1 leader in imaging and printing."
2. "Extend our lead as the #1 consumer IT solutions company in the world."
3. "Catapult HP into the #1 small- and medium-business IT solutions company."
4. "[Give] IBM a competitor... in the enterprise space."
I'd give her 1 1/2 of those points-- and the one that has worked is the one she listed last and soft-pedaled. Her stated goal was to beat the daylights out of Dell. That failed dismally (although Dell is trying to help make it work by imploding-- or should I say 'combusting'?).
Cooper also bemonas her terrible luck-- Michael Capellas could have helped HP a lot if he hadn't been very mean and quit. Actually, Fiorina forced him out, because she saw him as a threat.
Also, the wicked old economy went and got bad on Carly all of a sudden. Cooper apparently doesn't think that strategic plans should take economic forecasts into account. It was obvious, as early as 1999, that the dot-com bubble was going to burst fairly soon, and that companies would need to be very careful about spending mergers. Fiorina blithely ignored the signals.
Cooper also doesn't mention the failed PWC merger-- where she was going to overpay dramatically for a service building. It would have have bled HP of cash-- but the HP board thankfully got cold feet and pulled the plug.
It's easy to conclude that someone is underappreciated if you ignore all their bad points and make up good ones.
As for any positives inherited by Mark Hurd, I think you have to give a lot of credit to the ability and commitment of the underlings who stuck it out during Carly's mis-management.
As for benefits from the Compaq merger, that's difficult to judge. HP's not really much better off in the PC market now than before the merger, and certainly nowhere near enough to make up for what it cost in stock value. Could it pay off eventually? Maybe. But it's not at all clear that anything Compaq brought couldn't have been accomplished by HP on its own, especially considering Compaq's trajectory at the time of the merger.