CEO Transition at HP Gets a Little Ugly…Again
HP has had a difficult time with successfully filling its position of CEO. Though Carly Fiorina’s tenure lasted 6 years, she was forced to resign in 2005 amid allegations that her controlling interests and methods were not in the best interest of the company and its progress. Mark Hurd was selected as her replacement as CEO. Hurd also managed to hold onto the job for a respectable amount of time until 2010 when a sexual harassment suit opened up questions about his finances. HP performed an internal investigation into Hurd’s expense accounts, which revealed the kind of discrepancies that prompt CEOs to resign.
Next in line to take over one of the largest companies in the world (ranked 28th globally and 11th domestically by Forbes in 2011) was Leo Apotheker. HP Chairman Ray Lane has known him for 20 years and had very high hopes that Apotheker would be the right fit for HP; yet, Apotheker lasted just under a year. HP stock dropped 40% under Apotheker. The largest dip occurring upon the announcement that HP would be dropping its webOS devices and was considering selling its consumer PC division. Granted HP tablets did fail pretty miserably, but HP had invested over a billion dollars in the webOS product line. Stocks dipped 25% after that announcement alone. Apotheker thought he was doing the right thing by purchasing UK software maker Autonomy ($11B) and focusing on big margin business. HP’s brand just hasn’t been developed like that. PCs are part of who they are, and the public and investors weren’t ready to support such a drastic change in their brand.
HP’s next move was to think outside the box and hire Meg Whitman to be the new CEO. Her reputation for taking eBay from a 4million to an 8 billion dollar company in 10 years makes her the executor of one of the most impressive business successes in today’s market. HP’s decision to go for a leader with business experience in the sales market rather than technology development is a risk, but one that may pay off in the long run. One can only hope the position itself is not cursed and that this fit will result in growth and development that will benefit the tech world.