Strategic CIO // Executive Insights & Innovation
Commentary
8/26/2011
10:38 AM
Rob Preston
Rob Preston
Commentary
Connect Directly
LinkedIn
Twitter
RSS
E-Mail
50%
50%

HP Must Decide What It Wants To Be

CEO Leo Apotheker must articulate a vision that HP's employees can rally around and customers can understand.

Hewlett-Packard seems lost. While IBM is confident that its information technologies help build a smarter planet and SAP struts that its software runs the best-run businesses, HP isn't quite sure what it is or wants to be. Adaptive? Inventive? And so it merely sells a bunch of solid products--and will be selling fewer of them, after its announcement last week that it will kill or part ways with its smartphone, tablet, and PC businesses.

Marketing fluff aside, CEO Leo Apotheker must articulate a mission and vision that HP's people can rally around and its customers can appreciate. Apotheker, on the job for nine months now, told The Wall Street Journal this week that HP is beginning a "needed transformation," ostensibly to grab a bigger share of corporate technology budgets. But transform into what exactly? The preeminent builder and manager of data centers to power the cloud computing era? A company that's world class at helping customers store, manage, share, and analyze their reams of structured and unstructured data? It's still hard to know.

At least Apotheker seems to be narrowing HP's focus to corporate customers, now that retail phones and computers aren't in its future. But in March, when my colleague Fritz Nelson asked Apotheker what he hoped would pop into people's minds when they heard the HP name, he responded with a tinge of Apple envy: "I can't wait for the next product." He didn't sound like a man focused on enterprise needs and concerns. I don't imagine Apotheker was thinking about OpenView or BladeSystems when he conjured customers panting for the next HP product.

Five months later, having given the TouchPad tablet all of six weeks to not prove itself, Apotheker no longer has a crush on Apple. It's back to Plan B: Let's take on the likes of IBM and Oracle in the enterprise. Not that the actions Apotheker announced last week were the wrong actions. They're just late actions.

HP's now looking to sell its PC business and get out of the smartphone business at the very moment that all the talk and a lot of the buying patterns suggest that we're indeed entering a "post-PC era." It's like trying to sell condos now on the Vegas strip—that boom's over. IBM saw the writing on the wall seven years ago when it sold its PC business to China's Lenovo; HP needed an engraved invitation to leave.

HP now seems to be in the position of overpaying for companies and technologies years after IBM and others had their pick.

HP announced last week it will pay just over $10 billion for content management software vendor Autonomy--about 10 times Autonomy's revenue--long after IBM, EMC, and others staked their claims in that sector. HP's acquisition of data warehousing specialist Vertica earlier this year, following the failure of its internally developed Neoview platform, amounts to scraps compared with the analytics empire IBM has assembled with Netezza, Cognos, SPSS, and a few smaller players it acquired. And HP's move followed SAP's acquisitions of Business Objects and Sybase, and EMC's acquisition of Greenplum.

Global CIO
Global CIOs: A Site Just For You
Visit InformationWeek's Global CIO -- our online community and information resource for CIOs operating in the global economy.

In high-end IT services, despite its 2008 acquisition of EDS, HP can't touch IBM, which has about a 10-year head start integrating its software and consulting holdings into its already world-class services portfolio. There are still plenty of small, innovative companies for HP to acquire, to help it "transform" into whatever it is Leo Apotheker wants HP to transform into; buying a lot of big companies won't do it.

Apotheker also needs to weed out the decision-making bureaucracy at HP, returning it to its risk-taking roots. Get employees and enterprise customers excited again. That's Job 1. For Apotheker, as for another chief executive we all know, the "I inherited this mess" honeymoon is over. Carly Fiorina was a lot of flash, buying Compaq and wooing consumers with clever marketing. Mark Hurd cut operations to the bone. Neither ever put forth a compelling vision. Neither lasted very long. Leo Apotheker: What will be your lasting vision for HP?

Rob Preston,
VP and Editor in Chief, InformationWeek
rpreston@techweb.com

twitterFollow Rob Preston and InformationWeek on Twitter:
@robpreston @InformationWeek @IWpremium

To find out more about Rob Preston, please visit his page.

Comment  | 
Print  | 
More Insights
The Business of Going Digital
The Business of Going Digital
Digital business isn't about changing code; it's about changing what legacy sales, distribution, customer service, and product groups do in the new digital age. It's about bringing big data analytics, mobile, social, marketing automation, cloud computing, and the app economy together to launch new products and services. We're seeing new titles in this digital revolution, new responsibilities, new business models, and major shifts in technology spending.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest September 18, 2014
Enterprise social network success starts and ends with integration. Here's how to finally make collaboration click.
Flash Poll
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
The weekly wrap-up of the top stories from InformationWeek.com this week.
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.