HEWLETT-PACKARD chief executive Meg Whitman yesterday blamed unprecedented executive turnover in past years for dragging out the turnaround of the sprawling Silicon Valley computing giant.
Whitman, who became HP’s third chief executive in as many years after taking the helm from an abruptly dismissed Leo Apotheker, is trying to revitalise the former industry icon via layoffs, cost cuts, and expansion into areas with longer-term potential such as providing enterprise computing services. Apotheker’s 11-month tenure was marked by an acceleration of departures from various divisions, such as networking chief Marius Haas, as he brought in former co-workers from SAP AG.
My belief is that the single biggest challenge facing Hewlett-Packard has been changes in chief executives and executive leadership, which has caused multiple inconsistent strategic choices and frankly some significant executional miscues,” Whitman told investors at an annual conference in San Francisco.
The largest US technology company by revenue is trying to transform itself into a major enterprise computing provider, while slashing expenses to boost the bottom line.
The company is laying off 29,000 employees over the next two years, has written off $10.8 billion that was mostly related to the writedown of its EDS services business, and its business continues to be hit by a slowing in corporate spending and personal computer demand worldwide.
In the tablet market dominated by Apple’s iPad, Hewlett-Packard is seeking to appeal to corporate clients with an emphasis on security, durability and the ability to run business applications. It plans to release a tablet running Microsoft’s Windows 8 software later this year.
Whitman vowed to reduce the number of product offerings and cut costs as it tries to recover in a worsening macro-economic environment. She has said it will take five years for the turnaround to be effective.The company’s recovery will start becoming visible in fiscal 2014 with all of the current investments paying off, she said.
“FY 15 will be the year of acceleration,” Whitman said. “Revenues should be growing faster than cost.” - (Reuters)
