WSJ Nails HP
I don’t read WSJ much any more, partly because I don’t like Rupert and partly because of their pay wall. But this one is great – and its outside the pay wall. HP was such a great company too.
By AL LEWIS
Let’s say you were given a year to kill Hewlett-Packard. Here’s how you do it:
Fire well-performing CEO Mark Hurd over expense-report irregularities and a juicy sexual-harassment claim that you admit has no merit. Fire four board members, as publicly as possible. Foment a mass exodus of key executives who actually know how to run the giant computer company.
Hire new a CEO from German competitor, SAP, which sells business software, not consumer products. Tell the new CEO, Leo Apotheker, that Mr. Hurd “left H-P in great shape.”
Draw public criticism from a major corporate-governance advisory firm, alleging Mr. Apotheker filled board openings with cronies.
Pursue pricey mergers and stock buybacks. Allow expenses to run out of control. Try to blow through billions of dollars in cash reserves before the next global economic slowdown.
Provoke partners Microsoft and Oracle by threatening to put H-P’s own operating software on PCs. Then decide not to. Remember that promising webOS software H-P bought in a $1.2 billion acquisition of Palm last year? Sideline it.
Bristle when Oracle’s Larry Ellison tells the New York Times: “The H-P board just made the worst personnel decision since the idiots on the Apple board fired Steve Jobs.” And file lawsuits when Mr. Ellison hires Mr. Hurd.
Boast that you’re going to attack Apple’s iPad with your $499 TouchPad. Then dump your TouchPad in a $99 fire sale and announce you’re just not going to offer it anymore.
Telegraph to the world that you are just too dumb to make smartphones.
Raise your financial estimates, twice. Then miss them, twice.
Make sure Mr. Apotheker’s memo gets leaked to the media — the one that says “watch every penny and minimize all hiring.”
Announce plans to buy British business software company Autonomy for $10 billion, because it makes enterprise software just like SAP, which is what Mr. Apotheker knows best.
Announce plans to maybe sell the PC business. Or maybe spin off PCs as a stand-alone company. Uncertainty will damage the price.