HP CIO discusses changing the company culture, spending more time with customers, and moving to cloud platforms to execute faster.
Hewlett-Packard likes to remind people that it does things on a massive scale. Its global supply chain? The largest on the planet, it says. Its deployments of SAP ERP, Salesforce.com CRM, Workday HR, and Microsoft Lync unified communications software? Also the largest. Its $120 billion in annual revenue? World's biggest among IT vendors.
How about its big-company bureaucracy? You can't bait HP executives into any planetary references there, though new global CIO Ramon Baez concedes that lots of company processes before he arrived in August 2012 "were built for slow."
Part of Baez's job, working with boss John Hinshaw, executive VP of technology & operations, and the rest of the HP leadership team, is to focus "on creating a model that's more flexible and agile. How can we move at the speed of business?" Baez said in a wide-ranging interview with InformationWeek. After losing its way under former CEO Leo Apotheker, HP is now heading into year three of CEO Meg Whitman's five-year turnaround plan. Last year the company focused on diagnosing problems and shoring up its processes and infrastructure, and this year it has focused on rebuilding, before it heads into the recovery and expansion parts of Whitman's grand strategy.
Progress has been slow. Following an analyst meeting in October, where Whitman reversed her earlier statement that company revenue would likely grow next year, the company released a statement saying its revenue decline will "moderate" from last year's.
In an interview I conducted earlier this year with Hinshaw, he said HP's customers want to see three main things from the company right now: stability and a consistent strategy; renewed product innovation; and "one HP face" as they buy from multiple company units. I asked Baez about progress on that last front in particular, as most CIOs I meet with say what frustrates them most about HP is its inability to give them a single point of contact/throat to choke.
Baez responded by talking about Whitman's emphasis on building customer relationships, the fact that she has met with more than 1,000 customers in her two years as HP chief. He talked about the new "HP Way Now," about reemphasizing the principles Bill Hewlett and David Packard established more than 70 years ago.
"That being said, this is a very large company. It takes time to change the culture. It's my responsibility as a leader to show what that 'One HP' actually means," Baez said, noting that he's an executive sponsor of five large customer accounts. "When I meet with the CIOs of those businesses, I want them to think that they're the only customer I ever think about. I'm not in sales. I'm an IT practitioner, and I know what I expect from my suppliers, and I want to treat them how I want to be treated. I try to demonstrate that among our leadership teams, the deal teams, the account teams, and so forth. This is how you work with a customer."
Baez: "I don't want us viewed just as a service provider."
HP is training a few hundred executives as sponsors to augment the standard account GMs. "People are a little frustrated because we went through some changes in that structure," Baez acknowledged. "But these account GMs now know who to reach out to."
I asked Baez about his overall philosophy on IT leadership and strategy, and how his charter at HP differs from the one of former HP CIO Randy Mott, who led an "IT transformation" at the company between 2005 and 2008, under which it consolidated 85 datacenters to six and 6,000 applications to about 1,200, while requiring a rigorous cost-benefit analysis of every new IT project.
"What I can do is articulate how my leadership team views IT and changes in the operating model," Baez said. "I tell my team that I don't want us viewed just as a service provider. I want us viewed as a value creator and a knowledge center. That's extremely important here, especially when account teams say, 'Hey, Ramon, can you come to talk to one of my customers about so and so.' I'd love to, but you know what, I have someone within my organization who's an expert in that area, and they do a great job, they can present to that individual. If all they want to do is see me, that's one thing. But if they really want the knowledge of how to do something, let's bring [that expert] in.
"First, we changed the organization from being very inward-focused to being very outward-focused. We're thinking of that customer all the time. How does this make the experience for the customer working with us better? The second thing, we're not optimizing for IT; we're optimizing for the business. ... We've gone from a cost-cutting view of the world to one of investing in innovation. ... We're not looking at consolidation. Those days are over. We're focused on creating a model that's more flexible and agile. How can we move at the speed of business?"
The Business of Going DigitalDigital 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.
. We've got a management crisis right now, and we've also got an engagement crisis. Could the two be linked? Tune in for the next installment of IT Life Radio, Wednesday May 20th at 3PM ET to find out.