Global CIO: An Open Letter To HP CEO Leo Apotheker
The IT industry and its customers are changing in profound ways. As you take the helm of the world's largest IT company, here are a few suggestions.
Your responsibility was to keep making the types of big, transaction-oriented, and expensive software that SAP had always made, and the customers' job was to keep buying that big, transaction-oriented, and expensive software that SAP had always made, whether or not all that stuff was delivering value to those customers. (See Global CIO: SAP's Last Chance: It's The Customers, Stupid!.)
HP faces a bit of that challenge now: it has arguably the broadest product line of any IT company, and HP executives regularly describe how its massive supply chain gives HP incomparable purchasing leverage and how that, therefore, confers on HP strategic advantage. And I guess it does--as long as customers continue to buy the way they used to buy.
But what if some of those challenges mentioned above shift? What if customers place more knowledge on value and knowledge and speed-to-market and opportunism than on low-cost hardware—will you still have that competitive advantage? When HP customers say to you, "Leo, I need you to help me build a real-time enterprise centered on industry-leading capabilities in predictive analytics"—will your big honkin' supply chain meet that challenge?
And that brings us to your second primary challenge: competition. As the CEO of HP, your competitors are now not just Oracle and Larry Ellison, but Oracle and Larry Ellison and Mark Hurd (who knows a thing or two about HP), and IBM and Sam Palmisano, and Google and Erich Schmidt, and Amazon.com and Jeff Bezos, and ultimately Apple and Steve Jobs.
How will you rally your team to confront and overcome those challenges? How will you fight simultaneous massive battles on far-flung fronts against competitors who only have to do one or two things superbly all the time, whereas you and HP, by virtue of your scale and scope, have to do many different types of things superbly without a hitch?
For the answers, I'd suggest you look to your customers. Understand not just what they want today but what they'll need in three years, and then reorganize HP around customer-driven solutions rather than around product lines that those customers might—or might not—want in a few years.
Create the HP Center For Customer Value, representing your promise to deliver to your global customers not just hardware and software and services but enduring knowledge, insights, and best practices.
Compete on your ability to help big enterprises transform their IT organizations in the way your superb CIO, Randy Mott, has done with HP's—it's a feat unmatched by any CIO and any IT organization. Your company's already done, Leo, what most other big companies in the world are desperate to do—teach the world how to do it.
As for the "where's the HP smartphone?" canard, forget that tactical junk and make the leap past mobile to mobile-social—tie that in with transformation, innovation, and enduring value for your customers based on giving them the tools to engage with and deliver value to their customers in ways no other IT company can. On this subject: have you spent much time with your R&D leader, Prith Banerjee? You might think about turning him and his team and his set of uniquely brilliant skills loose on this spectacular opportunity.
Well, you've got lots to do and I've taken up enough of your time. Good luck, Leo, and don't forget that the customers are like the head: where the customers go, the body will follow.