Robert X Cringely quote† from 7 months back, posted earlier today by Gruber‡:
> Then there’s Meg Whitman, who expected at this point to have resigned from the HP board to spend all her time running California as governor. But that didn’t happen, so now what is she to do? [...] She’ll eventually get around to hip-checking Apotheker and taking his job.
This strikes me as an excellent demonstration of the "make as many wild ass predictions as possible until one of them hits and then have everyone think you're a visionary genius".
Yes, Cringely can really be out in left field sometimes. A good example was his recent theory that Tim Cook is only a temporary CEO and that Steve Jobs has a secret hand-picked successor that he will name in the future [1]. I read Cringely partly for the entertainment value and partly because he really does think out of the box. When the strange happens, at least we're not surprised.
If you are sufficiently connected to massive amounts of information, it is possible to be able to see many possibilities and make accurate predictions which, given the right circumstance, can come true.
This doesn't mean that his predictions were so wild - but that reality was so drastically divergent than what would have been perceived to the future.
I.E. There are definitely times when one can extrapolate very accurately multiple/many possibilities given an assessment of the current state.
HP appointed Meg Whitman as CEO earlier today, in an attempt to save the troubled computer maker. When asked what her first course of action would be, Mrs. Whitman firmly answered "eBay."
"I'm an excellent eBayer, and have been for years. You've never seen a feedback profile with so many A+++++'s before." Mrs. Whitman continued, "HP has warehouses full of inventory, ready to be gobbled up by the highest bidder. On my way in today, I must have passed about a dozen pallets of iPaq 3630's just collecting dust. Those go for a lot of money you know! There's so much stuff just lying around here that can be sold for big big bucks!"
The board of directors was quick to point out Mrs. Whitman's Titanium PowerSeller level status, among her many other credentials. "She accepts all major forms of payment, including PayPal." When asked about their CEO selection process, a board member went on to say "We won an auction for a used paper towel holder from her the other week. She even emailed a tracking number so we could determine the exact date it would be delivered. I must have refreshed UPS.com about a zillion times! Well, when we got it, turns out it was actually new, not used! That level of service amazed us, and we knew right then and there we found our next CEO."
Mrs. Whitman quickly detailed a plan to get the company back on track, including getting their feedback rating back up to 100%. "All these negative feedbacks about this Norton AntiVirus thing have got to go. And paying to upgrade your auction to bold, and including a picture, really does make a difference!" One shareholder noted that "It's executive-level thinking like this which will save this company." Other Shareholders have agreed, and bid the stock up to a yearly-high shortly after the announcement.
"Is Woz's cubicle still around here? I bet there's several Apple I's under his desk that'll go for lots."
When asked about long-term prospects beyond selling all of HP's assets, Mrs. Whitman indicated that they can continue to thrive by adopting IBM's business model of advertising their brand everywhere, without actually selling anything, financing it with Jeopardy-playing machines. "I love that show and watch it every night. Ooo, maybe we can make a Wheel of Fortune machine too! That'll really pump our margins up!"
I hope that she, despite all the naysayers in this thread, excels in the position and garners the support of her employees as well as the larger outside tech world.
Great one! Maybe she'll put the whole company on sale at eBay.
But the HP board actually announced: "Meg Whitman has the right operational and communication skills and leadership abilities to deliver improved execution and financial performance."
That'll surely turn HP TouchPad, Palm Pre, and WebOS around.
So, this board has recently brought in a software guy who doesn't seem a good fit for a company that does a lot of hardware, had him make a bunch of unpopular decisions, then quickly replaced him with somebody that's been on the board for quite some time, without reversing any of the previous "damage" that Apotheker is being blamed for.
Apotheker appears to be the fall guy for some unpopular decisions that the board wanted made anyway.
The article in the NYT today reported that the board fully supported the decisions he had made but didn't like the way he was communicating the changes inside and out of the company. Whether or not that is the real reason they fired him is anyones guess I suppose.
HP Board: We think we want to focus on the enterprise, but we need a hatchet man to cut the consumer stuff. We know it's going to be unpopular and destroy your reputation, and we're going to fire you for doing that. We're willing to pay you about $30M for your trouble. You in?
As a creature of the board - as opposed to an internal hire with a built-in power base - he's actually the last person you'd expect to go rogue. Indeed, the big criticism of high-level external hires is that they're insufficiently independent and easily manipulated.
For a guy whose credibility was already in tatters, $35 mm to be a fall-guy for hire seems like a pretty good deal. I suspect he felt the same way when he signed up. I just wonder if he realized the payout was going to come so swiftly.
HP does a lot of hardware on the consumer side, but they've been doing quite well in the enterprise without much ballyhoo. And the margins are way better in the enterprise than on the PC side (not counting "the ink is worth more than unobtainium" side of their business).
Yes, but you can bet that any manager that was about to plunk down a large amount of money for HP stuff with a sense of continuity is now looking at the competition.
The kind of boat-rocking that HP is engaging in is every corporate buyers nightmare and will cause a lot of sleepless nights in the houses of people procuring their enterprise product line.
I work in this field, with lots of HP hardware, and its not even discussed.
The lifecycle of new enterprise hardware is ~3 years. No one thinks HP would leave any enterprise customer screwed in the 3 year timeframe. Even if they sold the business everyone understands you will be supported that long.
Also, companies change hands all the time in the enterprise market. We're used to it, and generally a change of ownership is greeted with a meh response.
You're both right. While it is true that for the hardware business, HP's stability is surely good enough. On the other hand, when it comes to enterprise contracts, stability matters a lot more.
I have at least some first-hand evidence to this fact. $DAYJOB is currently at a large enterprise service provider. We are currently buying HP switches like crazy, and I don't expect that to change. I've also been privy to some aspects of the sales process. We can go through the sales song and dance forever and ever, going deeper and deeper in to technical and business details. However, when the prospect asks about company stability, size, and governance, this always signifies they are about to ask for a formal contract.
In other words, for big, enterprise customers, stability matters. It's impossible to tell what sort of effect this will have on HP. Maybe none. But these sorts of subtle changes to reputation have a funny trajectory of their own, independent of the instantaneous news cycle. I wouldn't be surprised if IBM et al. started using the shake-up to their advantage during the sales process. We very well might see some of the after-effects in the next six months.
The way HP handles this transition will be critical. If the board looks like they are floundering, I think they will be toast. If they can keep up the appearance of running a tight ship, they'll be alright.
It would seem to me that de-emphasis of the consumer side (i.e., psg and webos) to focus on the enterprise should have (in theory, at least) lead to greater confidence to enterprise buyers.
I don't know much about how smart a purchase Autonomy is (was?), but I do know that IBM has been acquiring data companies like crazy over the past 3 years.
when the prospect asks about company stability, size, and governance, this always signifies they are about to ask for a formal contract.
This is absolutely the case. But people still don't even bother asking about HP (same as IBM & Oracle & Microsoft & SAP). It's just not an issue at all at the moment.
I said earlier Whitman would be on my short list of bad choices for the job. I spent some time today thinking about who I would pick.
Someone with experience at a product company, that had to oversee design, manufacturing, and logistics. (Ebay is clearly not this.) Also, someone with experience at a services company with a track record of success. (Despite service--and SaaS--experience, Ebay "survived" rather than "succeeded", and in my judgement is not this either.) Someone who doesn't look to acquisitions as a primary way to expand the company's strategy. (Skype is evidence Ebay isn't this.) Someone who can communicate effectively with both the public and internal stakeholder. (A failed gubernatorial bid suggests few people were buying what Whitman was selling.)
In every relevant category, Whitman doesn't make the cut.
Exactly my thoughts. Whitman only has experience managing a business that was dominant in their area and due to first-comer advantage, basically had virtually no other companies that could come close to their effective monopoly position.
Yet - as you said, Ebay survived rather than succeeded. HP is a whole different kettle of fish - beset by rabid competitors on all side and without any significant advantages over any of them. At this stage, Whitman seems a really poor choice who will be immediately out of her depth in running HP.
hp used be renowned for management empowering employees. of course they also used to be renowned for only entering fields in which they could contribute real innovation (and making stuff just to make stuff, but making something new and better than anything else). i'm still in disbelief about this company. they have abandoned nearly every damned thing that made this company great. from jim collins' foreward to the hp way (linked in my last comment)
The core essence of the HP Way consists of five fundamental precepts.
1) The Hewlett-Packard company exists to make a technical contribution, and should only pursue opportunities consistent with this purpose;
2) The Hewlett-Packard company demands of itself and its people superior performance—profitable growth is both a means and a measure of enduring success;
3) The Hewlett-Packard company believes the best results come when you get the right people, trust them, give them freedom to find the best path to achieve objectives, and let them share in the rewards their work makes possible;
4) The Hewlett-Packard company has a responsibility to contribute directly to the well-being of the communities in which its operates;
It's possible someone from Amazon, G.E., or Oracle would meet those criteria.
The big thing HP was (is) lacking is a leader with experience manufacturing physical products. Putting that in place would settle some of the fears of procurement managers the world over (and maybe settle the stock market too). These aren't the only companies with experience, but it's one place to look.
However, were I on the search committee, I'd look internally first. A junior executive who knows the company might already have the respect of the employees.
Given carte blanche, I'd remove the Board and most of the senior staff.
HP is as good as dead. It will take a long time to die but they're now officially the Yahoo! of hardware. Brand damage this severe is going to be very very hard to fix.
Probably, but not necessarily. They're dead in the water on the consumer side, but enterprise can be turned around. I'd heard tell they were working on some uber-high-end scientific and government hardware, too, and maybe that becomes their cash cow eventually. Government contracting has certainly been kind to other hardware companies in the past.
They might be able to pull out of the race to the bottom / razor-thin-margins that is the non-Apple PC market, build up a high-end image doing cutting-edge industrial hardware, then (possibly) reconsider a consumer relaunch as a high-end, high-margin brand.
In a weird way I'm happy that Hewlett and Packard are not around to witness this, to see the work of a lifetime butchered like this is just too painful.
Actually for the company that Hewlett and Packard founded see Agilent. After the HP/Agilent division around 2000, Agilent took most of the early HP records. Why? Because Agilent's business lines were the original HP business lines.
From what I've read about them their retirement was permanent, they both had more than deserved it. So I don't think they could have avoided the mess unless they stepped in and that would be highly unlikely. Maybe a 'watchful eye' would have had some positive effect or a consulting role of sorts.
HP was a unique company and it definitely isn't the first time that such a unique company flows from the hands and brains of unique people and does not survive the transition to new management without significant damage.
The HP story does not bode well for Apple, which was even more the brainchild of some pretty unique individuals.
Steve Jobs is still around, and I really hope that Tim Cook will not embarrass Steve in the way that the HP board has fouled the HP legacy. Those guys deserved a lot better than this. Once upon a time there was the HP way. Today that's the stuff of legend.
Not a good move.
He started his job by doing some hard upfront decisions that he hoped will play in HP advantage in the long run.
And the board cut him off at the point when he didn't even started the transformation.
Now, who knows what will happen.
The other possible explanation is that he knew that he is going to be scraped, and had enormous compensation for receiving the blame.
A cynical person would surmise that HP knowingly hired Apotheker to be a sacrificial lamb. A lamb that would make a few unpopular board-supported decisions (to the public and stockholders) yet leave the board's hands clean once that lamb was fired.
Scapegoat, in the vernacular. http://en.wikipedia.org/wiki/Scapegoating : a she-goat with a silver bracelet hung from her neck was driven forth into the wasteland ...
They'll make it gold, and probably spare the sex change ...
Will we ever rid ourselves of corporate-speak? How many bits of information here?
“We are fortunate to have someone of Meg Whitman’s caliber and experience step up to lead HP,” said Lane. “We are at a critical moment and we need renewed leadership to successfully implement our strategy and take advantage of the market opportunities ahead. Meg is a technology visionary with a proven track record of execution. She is a strong communicator who is customer focused with deep leadership capabilities. Furthermore, as a member of HP’s board of directors for the past eight months, Meg has a solid understanding of our products and markets.”
RIM is betting the farm on QNX, they have a death grip on it. If it goes anywhere it'll be down with the captain of the ship.
The only scenario in which QNX is likely to be sold, from what I can see, is when creditors are disassembling RIM piece by piece. At that point, is there enough of QNX left to save?
What I find funny about such rapid changes is, can they reverse any of his decisions? For instance, will HP magically announce they're not really leaving the PC business and will be shipping new tablets?
The simple fact of having dumped the old CEO could at least lend a bit of credibility to reversing course on WebOS. Not a lot, to be sure, but definitely a nonzero amount, unlike the present state of WebOS.
This is such a shame. I got a touchpad in the fire sale and they really did a decent job on that thing. I would put it ahead of android but slightly behind iOS. Although I personally don't care too much which OS I end up with, it's clear that a lot of good work went into this.
I'm sure the HP board is full of smart people, so my question is: what's next? Over the past decade they've seemingly made so many more poor decisions relative to good decisions, I have to imagine they feel a lot of heat to do something... redeeming?
I mean, they're still a very large and very powerful company, and I think predictions of their impending doom are highly overblown, but they've certainly been dealt some serious PR damage. Do they swing for the fences with some "revolutionary" device/system/platform? Do they limp along (are they really limping in any sense other than PR?) hoping to heal as they go? Do they follow the path that's been set by the previous CEO, or do they reverse those moves?
It's going to be an interesting year, that's for sure.
HP's board might be full of smart people who make stupid decisions. HP's board started the decline by hiring Carly Fiorina, being a part of the pre-texting scandal, hiring and then firing Hurd, and now hiring and firing Apotheker.
Perhaps it's time to clean house at the board level.
It is hard to even think about what they could do to salvage their reputation at this point. The board (Whitman included) collectively falling on their swords as a mea culpa would leave HP rudderless (but that may not even be worse than the kind of shockwaves that it has undergone in the the last years).
Right now there are a number of very tough decision to be made and none of those are good. Either the former CEOs decisions will stand and then someone without that vision will have to implement them, the former CEOs decisions will be rescinded (it looks like they will stand for now) or there will be some magical third option.
For the moment the best thing about HP is that they are still selling ink, toner cartridges and enterprise gear and I wouldn't bet too long on the latter (see above).
You simply can't run a company like this, even a very big one. Employees, customers and 'the channel' want to see stability.
You know...this might seem silly, but until I actually read the story did I remember that Meg Whitman was Ebay's CEO.
For some reason, I kept thinking that it was Carol Bartz that was now CEO of HP.
The ironic thing is, given what I have been seeing of HP's upper-level management problems recently, it didn't surprise me. I didn't even bat an eye-lid.
It's just after seeing the title on about 4 different links that I decided to click the NYTimes article and realized it was eBay's ex-CEO not Yahoo!'s.
That metaphor has been around for a lot longer than 10 years and I'll continue to use it. Airplanes have been flown into human-made structures for a long time, either as an act of war (kamikaze pilots) or malice (Joe Stack) or mere stupidity.
I prefer that metaphor over "train wreck" because the latter has the sound of being accidental. No. It's not mere incompetence. You do not make CEO someone who made millions in IPO spinning unless you harbor a deep hatred for the company on whose board you serve. The intentional plane crash metaphor is perfect.
> Then there’s Meg Whitman, who expected at this point to have resigned from the HP board to spend all her time running California as governor. But that didn’t happen, so now what is she to do? [...] She’ll eventually get around to hip-checking Apotheker and taking his job.
† http://www.cringely.com/2011/02/why-leo-apotheker-will-be-fi...
‡ http://daringfireball.net/linked/2011/09/22/cringely-apothek...