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Mark Hurd enjoys playing up to his image as the antithesis of his predecessor. Where Carly Fiorina was a flamboyant and high-profile chief executive CEO at Hewlett-Packard, Mr Hurd is determined to remain low-key.
“You are not going to see big theatrical events at HP such as big mergers. I’m hoping these will be a thing of the past,” he says.
“I want HP to be a boring company.”
Rather than pursue large acquisitions or disposals, Mr Hurd, who took over the reins at the end of March after Ms Fiorina was dismissed for her failure to consistently meet profitability goals, says he is keen to return the company to its roots as a technology innovator.
He says that on joining the company, he was immediately impressed by HP’s research and development efforts but felt it the company was communicating its innovations poorly to customers.
“I was amazed at how much stuff was going on inside the company – but how much of this did customers know? I think HP has got to do a better job of making its technology transparent to the customer.”
Mr Hurd, who joined HP after a 25-year career at NCR, an automated teller machine maker, has made a point of customer contact at HP.
In the six months since his arrival he says he has already personally met more than 400 clients, and has taken steps to simplify the company’s over-complex sales structure.
At the same time, he is keen to retain R&D spending, particularly pure research, which he believes many other technology companies neglect.
Keeping HP at the forefront of technology trends, he says, would be a key strategy to differentiate the company from competitors such as Dell or IBM.
In addition to research, the company is working to bolster its services business, which is estimated to have turnover of $15.6bn this year – accounting for about 18 per cent of total sales.
The company has been making a series of small, bolt-on acquisitions of software companies, such as the $425m Peregrine deal last month, that complement its hardware and allow it to offer a more complete package of services to customers. Mr Hurd says further acquisitions are unlikely to be any larger, although he will not rule out bigger deals in areas the company is keen to expand in, such as data storage.
“I’d never say never – I’ve been around too long to do that, but the behaviour you have seen from us is the behaviour that you should expect,” he says.
Much of Mr Hurd’s focus to date has been on cost-cutting rather than growth. In July he launched plans to cut some 14,500 jobs – or 10 per cent of the workforce – worldwide, in a restructuring designed to save the company $1.9bn.
The efforts appear to have been producing results. Third quarter results in August - the first full three-month period of Mr Hurd’s leadership - beat analyst expectations, with sales up 10 per cent. Even more significantly, personal computer earnings improved sharply, while rivals Dell and Gateway were both forced to lower forecasts in the face of component cost pressure and weak average selling prices.
Mr Hurd says improved third-quarter figures, which beat expectations, reflect the fact that HP was in better shape when he took over than media reports might have suggested. The numbers were better and the morale more robust than he had feared.
“After everything I had read in the media and from buy-side analysts, I’d expected to find a company that had had its spirit broken. But it was different from what you would think,” he says.
“I wouldn’t say morale was high, but there was a tremendous thirst for trying to get the company to win.
“There is a real passion for the success of the company, that has touched me since the moment I showed up.”
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