leo apotheker

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Today there will be lots of stories written about Leo Apotheker’s plight at Hewlett-Packard. And of the HP board, and potential replacements for Mr. Apotheker. One lens I like to look through when doing strategic planning is the “history” lens.  When viewed over time – a long time – will the company, product or leader have made a historic contribution?  Typically, that means looking at strategy rather than tactics.

In Mr. Apotheker’s case, it is clear to me that his PR handlers were at fault.  His moves to purchase Autonomy, shed the PC and tablet business, and stop investing in WebOS were historic moves — looking well beyond the dashboard.  One might say, and say accurately, that when you put a software person in charge of a mixed media multinational, the road to the future is paved with software.  Mr. Apotheker saw deteriorating PC sales, reduced profitability in services (the cloud is getting not only bigger, but smarter), and device manufacturing (especially sans Steve Jobs) under enormous cost pressures. Think device kudzu.  Rather than stay and fight for integration of solutions hard and soft around his OS — which code-wise may not have been ready for primetime and perhaps at risk from new OS pushes by Microsoft and Apple — he decided to retrench with eye toward the future. Very ballsy.

The cloud is the future. Device complexity will reduce over time and when it does, the cloud, run by software, will become the electricity of business. And that is where Mr. Apotheker was going. Sadly, he had a lapse in judgment and bad guidance and announced it at the wrong time and inelegantly.  Como se billions in lost shareholder value?  Some strategies (read historic) are better left unannounced. Is that not so, Mr. Jobs? Peace.    

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Leo Apotheker CEO of HP in a recent interview came off as a really smart, refreshingly calm captain of the tech industry.  You know the type, not smiling but almost, methodical and thoughtful in his delivery. Confident, not cocky. He knew his numbers, his trends, margins (everyone’s margins, in fact) and had a plan – a future-proof plan.  Use WebOs as the connective tissue for all computing and communication devices, bolstered by an enterprise cloud play.  Lovely.  Sprawling but lovely. Anyone smell an apple?

Those who read these musings know I am all about focus.  That’s the brand planner in me. HP has been anything but focused over the last 10 years. A printer company. The world’s leading PC company. Outsourcing. Big iron. Smart phones. Tabs. And operating systems. But let’s not forget in the post Carly Fiorina era, this company’s financials have been smoking. So the company’s scale has been a positive.

In a stunning announcement yesterday, Mr. Apotheker went on record as saying he wants to jettison tablets, smart phones and the WebOs as businesses, sell the PC business as a standalone unit and buy Autonomy Software for $10B. Normally, I would support this type of move, especially for a floundering company, but this almost feels other-worldly.

The reported for the New York Times Verne G. Kopytoff (also sounds fishy) used words to describe the PC move such as “dump” and “unload.” What PR person was handling this briefing?   

I understand the need for focus and I get the desire to increase margins through upping the software and cloud quotient, which by the way dials down the need for headcount, but this business move feels bi-polar. I wonder how the story is playing in the HP Personal Systems Group today?  Check the meds. Peace.

 

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Hewlett-Packard is launching a new ad campaign today for the TouchPad tablet and it sounds rather messy.  I read about it in The New York Times ad column and hope it’s just poor reporting. The story was written by Elizabeth Olson.

Here’s my strategic take. 

  • HP is late to market with the tablet and needs to get noticed.
  • HP has a new operating system (OS), which will drive all its hardware devices. Called webOS, it will integrate their smartphones, PCs, printers, tablets and soon other devices and appliances.  It’s a cool promise, but s complicated story.
  • Printers are a big franchise and potential differentiator, so HP wants to make them more relevant.
  • The purchase of Palm and the growth of the smartphone market has made the mobile business a critical growth component.
  • HP is not a big brand with Millennials and teens.

That is a lot of stuff to convey.  If you have to say 5 things, you’ve said nothing.

The NY Times story starts out talking about a new commercial with Russell Brand. I’m feeling it.  A little old school, but I’m feeling it. Then it says there are executions with stars from iCarly and Glee. The future holds spots/vids from Lebron James and Jay-Z and Lady Gaga did some work in May but has not re-upped.  Add to that, all the social media contests (100 free TouchPads) and Twitter tchotch and you begin to see how it’s going to be hard to find the idea. Goodby Silverstein is a great  ad shop, but it doesn’t sound as if it hasn’t corralled this herd of goats. 

My head is spinning.  I hope it is just a lot of info, not well organized, by a reporter from another newspaper beat. And I’m no Leo Apotheker. Peace!

 

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