HP Impresses With Successes and Plans for a Turnaround

Hewlett-Packard is one year into a turnaround, led by CEO Meg Whitman, which could last for several more. This week she and other HP executives told financial analysts that the company knows what needs to be fixed and do, in fact, plan on fixing them. Such candid talk is refreshing these days, columnist Rob Enderle says.

By Rob Enderle
Fri, October 05, 2012

CIO — Hewlett-Packard held its financial analyst meeting this week in San Francisco, opening with the two most important folks in any large-scale corporate turnaround: the CEO and the CFO. Meg Whitman and Cathie Lesjak, respectively, were followed by the heads of the major HP divisions, including enterprise services, printing and personal systems, software, security and the converged cloud.

Whitman, In an Election-Season Rarity, Tells It Like It Is

The event was the first true showcase of whether Whitman can live up to her promise of turning HP around. Given that this is an election year, and given Whitman's foray into politics in California's 2010 gubernatorial race, I'm particularly fascinated by differences between presidential rhetoric and Whitman's presentation of the problems and solutions at HP.

Politics generally forces politicians into long speeches with little content. This year's election rhetoric comes down to a repeated drone of the problems being someone else's fault and, thanks to a divided Congress, impossible to correct. This extreme lowering of expectations showcases an ability to pass blame but doesn't lead to a real path to fixing anything.

While Whitman did point to a procession of rapidly changing CEOs as a cause of HP's problems, she spent more time articulating the problems and her progress in correcting them. In effect, she is taking ownership and overcoming obstacles, not blaming others for problems and then avoiding them. Politicians tend to run from metrics and milestones because they don't want to be blamed if the numbers aren't met. Instead, Whitman identified the lack of metrics as a core part of her problem—and one that was well along the way to being fixed.

Finally, government is often defined by antiquated systems and manual practices. Most technology companies are run the same way; like the cobblers' children, they get outdated, obsolete technology. For HP, that means its CRM, SFA and HR technology was unforgivably out of date. However, Whitman has implemented a best-of-breed program, using HP's partners, to assure that HP is as well-managed as it advises its customers to be.

It was hard to watch this and not wish the U.S. government has as strong a grasp of its problems and was as far along in fixing them. Whitman and Lesjak did their company proud.

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