Mark Hurd, Hewlett-Packard’s new president/CEO, had yet to spend one minute in his new office before he was bombarded with questions from Wall Street and the press ranging from how he perceives the company’s health to what his first actions will be as leader.
For the most part, Hurd, formerly NCR’s president/CEO, dodged these big-picture issues, stating that having just arrived here late last week he was in no position to speak to grand strategy. However, he did indicate that the company needed some work.
“It is clear to me that HP is a fundamentally sound company. It generates cash and is in a leading position in Enterprise, business and consumer products,” he said adding, “It is also clear that the company is not performing up to its potential.”
Stephen Baker, NPD’s research director, sees both positive and negative sides to Hurd’s appointment, saying HP needs a lot of work.
“He has done a lot with a little at NCR, but that was a services-oriented, vertical company. HP is a broad-based and horizontal company, and he will have a lot to learn to make the switch,” Baker said.
Van Baker, VP and research director for Gartner, added, “Primarily what he brings is an ability to cut costs, which HP needs to improve the profitability of some of its businesses. He also brings a focus on execution that HP needs. The board seems to feel that the strategy is sound but many people question that position,” Hurd was tapped by HP’s board on March 29 and officially started his new job on April 1. Hurd, 48, was a 25-year veteran of business machines maker NCR who became its president/CEO in 2003. During his NCR career Hurd also held the position of president/COO and ran the company’s Teradata division.
Hurd replaces Carly Fiorina, who was forced from the top slot by the HP board in February. Fiorina led HP for five years and was best known for pushing the controversial, $19 billion acquisition of computer rival Compaq through the company’s board. Patricia Dunn, HP’s non-executive chairman, said in February that Fiorina’s dismissal was the result of the HP board disagreeing with how Fiorina was executing her duties as CEO.
Hurd said not to expect any immediate changes at HP. He downplayed the question of whether HP should spin-off some of its divisions by saying the company should be worried about improving its performance under its current organization.
The possibility of a major shake-up at the company was not totally taken off the table as Hurd said HP had to optimize its performance. The methods he pointed to as being creating better efficiencies and better utilizing the company’s “human capital.”
“My initial focus will be on improving operations, but I have a lot to learn about at HP, so don’t expect to see a lot from me right now,” he said.
During Hurd’s press and analyst meetings last week he frequently mentioned living up to the HP ideals established by the company’s founders and the fact that his managerial style is team oriented. This includes building strong relationships with other company executives and creating a non-hierarchal feeling among the workers.
This is obviously an important point to Dunn and the other board members. Last week Dunn said that Hurd’s biggest challenge will be for him to get a grasp for HP’s corporate culture and feeling at home with his new company.
NPD’s Baker was not certain Hurd’s laid-back style, which went well for him at the much smaller NCR, would work in his new environs. “This is HP. Its CEO should be a high-energy personality. He is a more behind-the-scenes guy,” he said.