With the much-anticipated axing of Leo Apotheker, new CEO Meg Whitman has a mighty challenge on her hands to get Hewlett-Packard back on track.
Heading for Higher Ground
Whatever the reasons for his departure, Mark Hurd left HP in a powerful, fit state with a slate of smart products lined up for launch. His successor, Leo Apotheker, came from the lofty enterprise software world of SAP and never seemed to get hold of the trench warfare where many of HP's markets are involved.
So, now Whitman steps into the firing line. Herself a major mover and shaker, having brought eBay from a back office to a global powerhouse, she must be relishing the challenge. However, HP and eBay are different beasts and while Whitman's dabbling with politics will have primed her for the boardroom battles to come, it is how she treats the company's many products and markets that will see HP either bounce back or fade into the distance.
A New Strategy?
Whitman did a good job of riding eBay's meteoric rise to prominence. However, on the negative side, the choice of acquisitions (PayPal -- overpaid for, and Skype -- bought and sold on a dubious premise) weren't the smartest moves, but if she has learned the lessons from those, will be better prepared for life at HP.
To turn HP's stock price around -- and it's really the stock that's in trouble, not the company product lines or its biggest markets (hardware, services, printers, etc.) -- Whitman will need to make some bold decisions quickly. And it won't be necessarily easy to get her head around a company some 20 times bigger than eBay with infinitely more complex processes and divisions.
Will she keep webOS and try to turn the company into more of an Apple than a Dell or Samsung when it comes to consumer products? Will she pour more fuel on to the fire by trying to partner with, or purchase, Yahoo -- itself in dire straits? And what of its new cloud services project, which offers a chance to rival Amazon and IBM?
Just about every takeover rumor and possible strategy has been thrown into the pot before Whitman has got her feet under the boardroom table, but HP's pride in engineering and the necessities of today's consumable services market are the core features she must address. Whatever her course, HP stock rose 10% on the news of her hiring, and watching the first exchanges of her tenure will make for fascinating viewing.