As the markets closed today, HP announced the CEO Leo Apotheker was out, and Meg Whitman was in as the new CEO. Whitman has been on the Hewlett-Packard (HPQ) board of directors since earlier this year, and brings experience from eBay and other companies to the top position of a company with more problems than Jay-Z.
HP has had a rough year in terms of sales and leadership, and is currently getting a semblance of direction from a divided board that was apparently so “exhausted” that they didn’t bother to interview Leo Apotheker before hiring him less than a year ago. Now, after a year fo troubles, and expensive purchases, HP has tapped Meg Whitman to run the company.
Rather than have Whitman lead on a short-term basis, HP’s board is giving her the reigns and the power to make long-term plans for the floundering company. You can learn about Meg Whitman and HP’s announcement, or keep going for the explainer on Hp’s current mess.
Why is HP in a Mess?
HP’s current mess starts back in 2005 when the Company forced out then CEO Carly Fiorina (and gave her a $21 Million severance package). After a brief batch of leadership by Robert Wayman as Interim CEO HP named Marc Hurd to be the CEO of HP. Hurd led HP through 2010, including the acquisition of Palm and the company’s board investigation pretexting scandal, before a sex scandal and issues with properly filling out expense reports.
After a long and drawn out internal fight by HP board members, who by this point were likely looking for the last bottle of scotch in the boardroom, gave the CEO job to Leo Apotheker who had just come off a 9 month stint as CEO of SAP and was reportedly the only person who would take the job. Setting up his short and damaging stint as CEO, the board didn’t even interview him.
This leads us up to how Apotheker got HP in its current mess.
What did Leo Apotheker Do?
Sadly, Apotheker isn’t known for doing much good during his less than a year at the helm of the HP. The highlights of Apotheker’s time at HP include a public push to innovate and deliver products to market faster, which he didn’t deliver on. Killing off a promising and expensive WebOS platform because he wanted to focus on software. Dropping 10.2 Billion on enterprise software company Autonomy. He is also credited with the company’s continuing discussion on spinning off the HP computer business.
Apotheker will probably be best known to regular consumers as the man who made the $99 TouchPad possible.
This led to a year of ups and downs for HP Investors who were breaking out the bubbly yesterday as rumors began to swirl. As the market drew to a close today, HPQ stock was back to $22.80, and is up in after hours trading.
Who is Meg Whitman?
Meg Whitman has been on the board of HP for a year now after running eBay and running for political office.
Meg Whitman’s Bio from HP,
Ms. Whitman served as President and Chief Executive Officer of eBay Inc., an ecommerce and payments company, from 1998 to March 2008. Prior to joining eBay, Ms. Whitman held executive level positions at Hasbro Inc., a toy company, FTD, Inc., a floral products company, The Stride Rite Corporation, a footwear company, The Walt Disney Company, an entertainment company, and Bain & Company, a consulting company. She also served as a director of The Procter & Gamble Company from 2003 to 2008 and DreamWorks Animation SKG, Inc. from 2005 to 2008, having resigned from both boards of directors in preparation for her 2010 California gubernatorial bid.
What Does This Mean For WebOS?
Right now we don’t know what this means for WebOS, but given the fact that HP hasn’t shut down WebOS tablet production, and still owns WebOS, Whitman could revive the tablet. Our writer Kevin Purcell has championed for a WebOS tablet and HP notebook bundle, which Whitman could try to pull off. If HP keeps the WebOS business and the PC Business, who knows, we might see WebOS on all of our HP computers.
What does HP Need to Do?
HP needs to take immediate action to come back from the damage done by Apotheker.
Most importantly, Whitman needs a clear vision for HP’s direction. Is it WebOS? Personal Computers? Printers? Enterprise software? Who knows? but Whitman needs to figure this out before she steps into the CEO’s office.
Next up HP needs to bring back the innovation. This means letting people take risks and fail. It also means really figuring out how to deliver a better tablet and a better notebook. If Whitman wants to stay in the consumers side of the business, Hp needs to not be a commodity.
Finally, The HP board needs to get things together. At some point, these members will need to sit down and decide if they have what it takes to lead a company like HP, and ask themselves if they know what they want from HP. The decision to look for a new independent director is promising, but HP needs action.