Mon, Jul 25, 2005 - Page 11 News List

Disassembly required in HP's organization

BIG CHANGES Hewlett-Packard's new CEO announced that 10 percent of employees will be laid off, and pensions will no longer be offered. What's behind their strategy?

NY TIMES NEWS SERVICE , SAN FRANCISCO

Sharper focus

Yet the president of Forrester Research, George Colony, who met last week with Hurd, is convinced that the company's new chief will impose a sharper focus on Hewlett when he unveils Phase 2 of his plans for the company.

The only reason he did not do so earlier this week, Colony said, is that he has not been there long enough to devise a new strategy.

"If I were a really smart guy who talked to the board about being CEO," said Mark Anderson, the editor of the influential technology newsletter The Strategic News Service, "and they told me don't change the strategy, I'd laugh at them. Except I wouldn't be able to laugh at them and get the job, so instead I'd be very quiet and then a few months later I'd announce my new strategy."

What that new strategy should be -- whether the company should sell its personal computer division, as some argue, or spin out its printer and imaging division, which accounts for about three-quarters of its profits, as Milunovich argues -- depends on whom you ask.

"If you had a few drinks with the guy," Colony said of Hurd, "I think even he'd tell you he doesn't know yet what the answer is."

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