Analysis: HP Spins CEO Carousel and Picks Wrong Horse in Apotheker
Nothing miraculous has transformed Leo Apotheker since his old school ways failed to energize SAP employees or customers during his brief stint as CEO. Apotheker is not the best choice--even if HP has designs on enterprise software or SAP itself.
Thu, September 30, 2010
CIO — In professional and collegiate sports, it's referred to as the "coaching carousel": Each year, losing sporting organizations unceremoniously fire their head coaches. Words such as "disappointing" and "change" and "new direction" are bandied about.
Weeks or even days later, a few of those same discarded coaches are ceremoniously introduced as the new coach of another (losing) team in need of change. Words such as "experienced" and "track record" and "good fit" are tossed around. (The NFL's Eric Mangini and NBA's Mike Dunleavy leap to mind.)
The platitudes flow freely—whether based on any semblance of reality, or not. New strategies and schemes are announced to generate excitement among the loyal fan base.
What happened in the interim to effect such a change in those cast-off coaches? Who knows.
But what we do know is that one company's discarded CEO can be another's treasured find. At least in the eyes of old-school corporate boards.
Spinning on the CEO CarouselIn the high-tech world, there is such a thing as a "CEO Carousel." A recent example is CEO Mark Hurd's TMZ-worthy departure from HP and acrimonious arrival at Oracle.
By now, everyone has heard that Hurd's replacement at HP is none other than Leo Apotheker, the multi-lingual former CEO of enterprise software giant SAP. Apotheker, you'll recall, was asked to step down from his CEO post not even a year into his troubled tenure.
When SAP cut Apotheker loose on Super Bowl Sunday 2010, the company was a listless vendor in need of a re-charge. At the time, I observed:
SAP was a mess. Its still new-ish CEO, Leo Apotheker, was forced out, followed by a thorough house-cleaning at the top. Employee dissatisfaction was running rampant at the German ERP giant. Rather than SAP customers talking about apps, everyone was focused on SAP maintenance and support pricing, which is not a good thing. Competitors old and new were chipping away at its number-one spot in the enterprise apps universe. Revenues, profits and operating margins were all down year over year. If we could have measured SAP's influence at the start of 2010, the most accurate assessment would have been: waning.
Sticking to the "script," SAP proudly announced their new co-CEOs, Bill McDermott and Jim Hagemann Snabe, using the words "product innovation" and "profitable growth" and "innovation" (again). The SAP Supervisory Board thanked Apotheker for his "enormous contribution to the success of SAP." (Insert well-timed cough here.)