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Forbes Now Thinks Carly Saved HP
Justen writes "It's been nearly a year and a half since Carly Fiorina was fired as CEO and chairman at HP. Now, Forbes is saying Mark Hurd and HP today are reaping the success of the strategies she developed and decisions Carly made. 'Fiorina's demise was chalked up to bad execution of bad strategic moves, most notably the 2002 Compaq acquisition. But Hurd has always said there was nothing wrong with Fiorina's strategy. He seems to be hewing close to it. He rejiggered the org chart but said he'll keep the company together instead of breaking it up along premerger lines, as Fiorina's loudest critics suggested doing.' Forbes adds that HP's revenues, profit, and market share have held steady or improved since Hurd came aboard, but asks: 'Whose results are these? You could make a case that they are as much Fiorina's as Hurd's. The effects of strategic moves like buying Compaq stretch out over years.' So, which is it? Did Carly kill the HP way? Or did she save what was left of it?"
Carly was a nazi manager. She expected all employees to be "yes-men/woman". If you were an executive and did not agree you were out the door. If your division missed numbers you were out the door, even if it was her fault. Most of the exiled execs went to other companies to kick HP's butt. She lost all respect from the rank and file with her queen attitude and work ethic. Just the typical case of "do as I say, not as I do".
Yes, Hurd probably does not deserve the credit. When Carly left, HP employees litteraly threw champagne parties and were motivated again to work. So I guess the credit goes to the board for finally having the guts to kick her out the door. They gave her way to many chances and they should have done it after her first year with HP. But HP has always been extremely AA sensitive and they did not want to boot the first woman CEO HP had.
Carly may or may not have been good for business, but she sure hurt morale and definitely destroyed or at least sent into hibernation much of the "HP Way". People actually cheered when they heard the news that she was fired, and we're finally starting to see some of the HP Way slowly coming back now.
Of course, Hurd's cost-cutting methods have crippled the ability of many of us to do our jobs, but at least people aren't so depressed about things like they were under Carly.
I think selecting Carly was a symptom of HP's decline, not the cause of it. The company was well down the path of losing its way by the time Carly came along. Look at the history of HP to see what I mean. The original culture and values of the company instilled by Bill and Dave were all about innovation, quality, community, employees ... basically the vaunted "HP way". And this recipe worked extremely well as is evidenced by the financial performance and growth of HP over many decades, through boom times and slow times. No long term debt. Very high margins. Unparalleled customer and employee loyalty (extremely low turnover, no layoffs). Unequalled product quality. This is the company that brought us such hallmark products as the scientific handheld calculator (the venerable HP35 and its follow-ons), the logic analyzer, the inkjet printer, the laser printer, the "Pisces" emulation systems, the HPIB instrument interconnection bus (now better known as IEEE-488), 360-series PC board test stations, phased array cardiac ultrasound systems with color flow for non-invasively measuring blood flow ... the list of notable, first-in-class (as opposed to me-too), commercially successful products is indeed long. But as Bill and Dave moved into retirement the company began to evolve (devolve in my opinion). Innovation mattered less than "time to market". Quality mattered less than "cost". Employees mattered less than "efficiencies". Engineering mattered less than marketing.
So, by the time Carly was hired as CEO of HP, they had already spun out the intruments and medical divisions - basically destroying the diversity of HP, leaving it as a computer company operating in a viscious low-margin market. They had already moved away from the concept of autonomous divisions, towards big, bureaucratic, centralized behemoths. They had already abandoned the fiscal discipline whereby all growth was self-funded and moved towards funding growth with long-term debt. And isn't it obvious that the company that was once HP is now just another computer company - nothing special. Sure, they have lots of shelf-space at CompUSA, and they move lots of boxes for a small profit. But the breakthrough, innovative products are no more. The reputation for quality is gone. I don't blame Carly, nor do I give her credit "for saving HP", since the HP I knew is long dead.
The more you regulate a company, the worse its products become.
(Posting anonymously for obvious reasons. Read on ...)
... All under Mark's leadship.
...etc.)
...etc.)
I can't comment on Carly as a CEO since I never worked at HP. However, I can comment on Mark Hurd's past career.
Mark took the helm at NCR after being groomed by Lars Nyberg, one of the worst CEO's NCR had in its 130+ years. Lars came to power following another (perhaps worse) CEO, Jerre Stead. Jerre was a televangelist type who was all showmanship and nothing else. He tried the motivational angle, and co-authored a book (Flight of the Buffalo) with another corporate consultant (Jim Belasco).
This was when NCR was an AT&T company. Jerre jumped ship when the numbers were really going south, leaving the company for a year in the hands of someone from AT&T who did not care, and fled to the mother ship as soon as the trivestiture (where AT&T spun off Lucent and NCR) was announced.
Lars was a cost cutter in the real sense of the word. He shutdown or sold much of NCR's computer division to focus on ATMs, Point of Sale and Teradata. We froze development on NCR's UNIX SVR4, and stopped making PCs, servers and pretty much anything in generic computing. Teradata has been bought by NCR when AT&T took over, and had really neat technology, albeit a niche market (decision support).
Lars made Mark Hurd head of Teradata, after being in sales for 20+ years. We kept hearing every quarter and year: Teradata is our flagship product, Teradata will pickup, Teradata will change things, Teradata this, Teradata that
The stock value under Lars continued to languish, and while tech companies were making money from the bubble, NCR was stagnating (we did not capitalize on our presence in banks,
A few years ago, Lars was evicated by the board (remained on the board) and Mark replaced him. The word in the company from people who worked under him is that he "decided to be a rock star".
Hurd co-authored a seemingly content-free book with his mentor Lars Nyberg. Here is a brief on the book The Value Factor: How Global Leaders Use Information for Growth and Competitive Advantage, and here is the Amazon link. The Register made fun of it because it had things in it like "information isn't aligned". The book is of course influenced by Teradata being the information store of a corporation, and how it can be analyzed and capitalized on. It must have helped advertise Teradata too.
To his credit, NCR's stock climbed and even split under Hurd, in stark contrast with the Nyberg era. This may be due to his rock star approach and getting more media and analyst attention.
NCR's size is about the size of HP's printer division alone. HP is too big for Mark, around 10X as big.
So, Mark cannot take all the credit. His advent may have boosted morale in HP because Carly was much hated, but her strategies are the ones in effect today (merger with Compaq,