Following nearly two months of intense speculation since the sudden
resignation of Mark Hurd, HP late Thursday announced the selection
of former SAP head Leo Apotheker as its new CEO and president.
Apotheker himself is no stranger to sudden changes in the executive
suite, having himself unexpectedly resigned as CEO of SAP in
February.
HP characterized Apotheker's 20 years at SAP as positioning him
ideally for the HP gig. "Leo is a strategic thinker with a passion
for technology, wide-reaching global experience and proven
operational discipline--exactly what we were looking for in a
CEO,” said HP board member Robert Ryan, in the press release
announcing his selection.
Apotheker himself didn't provide any hints as to the direction he'd
take HP, following Hurd's often-stormy tenure. "As we move forward,
HP will continue to be a valued partner with our customers as well
as a fierce competitor," he said in the HP press release. "I look
forward to working with the outstanding people at HP to write the
next chapter in the company’s long and proud
history.”
HP is coming off of a solid third fiscal quarter, in which it
reported revenue of USD 30.7 billion and an operating profit of USD
2.3 billion. It has also recently forecast a healthy 2011.
Nevertheless, the company, which is the largest purveyor of
computer technology in the world, is playing in an intensely
competitive sector. IBM and Oracle -- the latter coming off its
recently completed acquisition of Sun Microsystems -- have HP
firmly in their respective sites. Both have put a big stake in the
ground in the emerging area of optimized systems. These are tuned
computing systems which combined server hardware and enterprise
software , in a package which delivers performance which far
outpaces conventional set ups.
On the marketing front, Oracle CEO Larry Ellison has made himself
the face of his company's optimized systems effort. Perhaps that's
one reason some industry analysts expected HP to pick a
high-profile candidate for the CEO post. Apotheker while not the
most charismatic executive, certainly fits the profile of a
seasoned leader who's done time in the command chair.
On the data center front, HP has gone with a strategy called the
Converged Infrastructure as a play to tap into enterprise
customers' desire to put their computing architectures on a "2.0"
generational footing. HP's go-to-market approach bundles its
servers -- such as HP's popular BladeSystem blade offerings -- with
storage and networking. HP has recently increased the heft of its
networking portfolio, adding its USD 2.7-billion acquisition of
3Com to its in-house ProCurve brand.
Over the next decade, stoked by the need for server consolidation,
the infrastructure 2.0 market will be an intense battleground. HP
faces competition from IBM's Dynamic Infrastructure approach, which
was recently and smartly placed under the "Smarter Planet" banner.
Dell's portfolio is dubbed the Efficient Enterprise. Cisco, which
recently used its networking beachhead to launch a foray into the
server space, rolls everything up under the umbrella of Unified
Computing.
While Apotheker may face a learning curve on the hardware front,
his heavy hitting enterprise-software experience could help HP make
new inroads in that market -- some at the expense of his former
employer.
That's consistent with the take of Stuart Williams and Ezra
Gottheil, analysts of Technology Business Research Inc. In a note
e-mailed Thursday evening, they opined: "The experience Mr.
Apotheker brings in running and selling an enterprise software
company is directly beneficial to HP. Given the strong margin
contribution of enterprise software, TBR believes Mr. Apotheker
will reinvigorate the Software portfolio under the HP Software and
the Enterprise Server, Storage and Networking divisions as a highly
profitable lever that can help to quickly lift overall HP
profitability. The appointment reinforces the perceived importance
of outside experience in running the software business following
the hiring of ex-Microsoft executive Bill Veghte as the head of the
HP Software and Services division."
HP will hold a conference call Friday morning to provide more
details on the selection.
Cathie Lesjak, who served as interim HP CEO since Hurd's August
resignation, will remain in her post as CFO.