What do we learn from the hiring of Mark Hurd as HP's new CEO? the first signs are that they are very different people.
HP is a company with a long heritage and strong idea of its own identity. Hurd's flamboyant predecessor, Carly Fiorina, was concerned with little of this. She's unlikely to be forgotten for two key reasons.
First among these is the merger with desktop and server company Compaq. Always controversial, there was an immediate culture clash. Rooted in labs-based primary research, HP has always believed that its ability to invent things was a key differentiator. Compaq on the other hand, though innovative in many ways, was essentially an aggressive sales organisation.
More important though was the huge overlap between the two companies' product sets, which made amalgamating them hugely painful for those involved, and confusing for those of us outside, trying to make sense of it all.
Second was Fiorina's high-profile management style, which some insiders saw as necessary to bring HP more into line with the modern world. Others saw it as unnecessarily abrasive.
Replacing Fiorina at least allows HP to put the pain of the Compaq merger behind it. Hurd also exhibits none of Fiorina's management styles. Previously head of NCR, he worked there for 20 years before becoming its CEO. Also an organisation with a long history, albeit one with a low and drooping profile, in his nine months' tenure, he boosted its net income by a factor of five, primarily by cutting costs.
In his first public statement he said next to nothing -- fair enough since he only arrived at the company's HQ last Friday, his first day in post. But he will, in his own words, take his time to understand where the company is before he starts making pronouncements.
He arrives without baggage. There were, he said, no pre-conditions to his accepting the post. He hasn't ruled out spinning off any parts of the company. The highly-profitable printer business is the usual candidate for such speculation, though a more honest analysis would see that more as an inkjet printer cartridge business; there's some 80 per cent margin on cartridges.
However, at NCR, there's little evidence that this is his approach to corporate problems. Observers say he understands how to make a company work. His track record suggests that he's more likely to cut costs in low-profit areas.
For example, should HP continue to sell servers, laptops and PCs across all geographies, from to the top to the bottom end of the market? Although this business rakes in billions of dollars, HP has struggled to make much profit out of it. It's likely the division will be Hurd's first on his checklist for urgent attention.
Hurd intends to take his time. He said he plans to listen to employees, customers, partners and investors to help him decide what needs to be done to improve performance overall. While this could include re-organising the company, it would appear that sharks expecting an instant fix in the form of a lucrative scattering of HP's most valuable assets will have some time to wait. They could well still be waiting by the time Hurd decides he's had enough.
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