Hi Denys and all,
Perhaps she did, perhaps not. Most likely, apart from her inner circle,
people will never know for sure, and thus be inclined to hang on and
propagate each and every rumor. It's now been the case for almost 7 years,
and counting.
Perhaps a little perspective won't hurt.
When was the 3000 death sentence pronounced ? 11/14/2001. When was the
HP-Compaq merger announced ? 09/05/2001, about 2 months earlier. When was
the Carly Strategy announced ? Weeks after she officially took over from Lew
Platt, I don't remember the exact date, fall '99 for sure, which is a full 2
years earlier than the 2 previous items. What was the Carly Strategy about ?
In a nutshell, or a few nutshells :
1) Spin out, sell off, or otherwise get out of anything that's not core
business
2) Be IT #1 company. Organic growth can't do it on its own, therefore growth
has to come from outside.
3) Refocus HP's own resources toward getting the most bang for the buck.
4) Reform HP structures upside down. HP is a product-oriented company, is
should become a customer-oriented company.
5) Let's get rid of everything that impedes reforming the company
6) Let's get rid of anyone who impedes reforming the company
7) Oh, while we're at it, let's focus on services. That's where the money
is. And it certainly also can't hurt #3
So how did that list turn out ?
1) Agilent. Assumption : IT is HP's core business, not medical, not
analytical, not instruments and so forth. Anyone who's followed HP long
enough knows that was the situation in the late-90s, but certainly not a few
decades before. Perhaps Bill and Dave are spinning in their graves, perhaps
not. They've been visionary enough to lead their company into instruments,
data acquisition, medical, computers, and so forth. Besides, spinning off
Agilent brought HP much-needed cash for ...
2) ... the HP-Compaq Merger. At the time, HP was not too strong in Wintel
servers (1 Netserver for 5 Proliants, IIRC) and needed an outside market
presence. It simply went after the largest market presence. Same can be said
about laptops. Omnibooks, while reasonably good machines (I've had 3, all
good), sold less than Compaqs, so they were axed. The VA storage arrays were
short on their feature set, compared to EVAs. They were axed. So were
NetServers, Vectras, etc. Wherever HP's market presence was leading, it
remained. Deskjets, LaserJets, HP-UX, and a few others. But remember, beside
grabbing market share, a merger is there for rationalizing production and
admin, and, let's face it, cutting overhead costs. Which brings us to ...
3) ... refocusing resources, and reorganizing the whole company. At the time
Carly took over, HP was strong on products but short on marketing. IIRC, it
had 80-something product divisions, organized into relatively loose groups.
Each division had its own R&D, its own marketing, its own admin, and so on.
And each division knew perfectly well how to develop its own product range.
As a result, the overall company was, at best, inconsistent in its marketing
effort. I guess everyone who was on this list in the 90s remember the
permanent complaining about the inappropriateness (what a politically
correct statement !!!) of CSY's marketing. Now, let's be specific : at the
time, CSY had a huge team of very brilliant engineers, admins, managers,
etc. Seen from a purely technical perspective, it was near-perfect, and only
required some fine-tuning to enhance the marketing effort toward, say,
customer-demanded enhancements. Seen from a business perspective, it was
gobbling up huge resources (hey, these brilliant persons are not supposed to
work for that minimum wage, are they ?), with limited bang for the buck (CSY
was not a very, very big division as compared to, say, the division that did
Desjet cartridges), and no potential for growth (proprietary OS were, at
best, a stable business, certainly not a growth opportunity. It's that
triple curse that killed the 3000 : huge resources needed, not much ROI, no
potential for growth. And now that the divisions have been axed, let's get
one step further ...
4) ... and now, we have a much leaner, much more efficient, much more
profitable company. At least in theory. All the restructuring effort was
severely compromised (and almost capsized) by something that any first-year
economics student could have seen coming, but that senior managers rarely
ask first-year economics students to analyze : the internet bubble. When it
burst, all the IT industry bled to death, or near-death. HP, though
comparatively less wounded than others, did not escape the impact entirely.
Thus, at a time when each and every buck was needed for restructuring and
addressing long-term priorities, it was also needed to address much
shorter-term priorities, like coping with shrinking activities and markets,
shrinking ROI, etc. The whole ROI picture suddenly looked kind of gloomy. So
a much higher pressure had to be applied ...
5) ... by also killing off the impediments on the road to reform. Mostly the
HP Way. This point is very tricky to argue. It's probably where Carly
immensely failed. In her desire (let's grant her the benefit of the doubt
and assume it was sincere) to reform the company, she brutally antagonized
people who had known HP for a while (decades, in many cases), who had met
Bill and Dave in person (I had, though very briefly), who had held senior
management positions for longer than herself, in other words who had a
tremendous credibility in running things. But running is one thing,
generating growth is another. Clearly, Carly was convinced that the
prevailing mindset within HP when she took over was not appropriate to turn
the company from a challenger player into a #1. But shaking mentalities was
not enough. She also had to shake people ...
6) And shake people she sure did ! Who remembers the Walter Hewlett scam ?
IIRC, Walter Hewlett was "not renominated to the board" (read : evicted),
because he incarnated the past, not the future. First, because of his name.
Second, because of his curriculum, Third, because of his tastes (IIRC, he
had a deep personal interest in performing arts). There are countless
numbers of others, famous or anonymous, who were axed for similar reasons.
7) And finally, Carly announced that HP had to go into service. Service ?
Well, support is service, hardware maintenance is service, many things are
service, but what she (and shareholders as well !!!) was after was profit.
Not service for the sake of service, but service because its ROI ("bang for
the buck)") is much higher than simply developing and selling (and servicing
!!!) products, even best-in-class ! Hey, Microsoft has know forever that
being out of the hardware business is quite a good thing. And, well, what
are banks doing, if that's not service ? If my memory is good, banks are
among the most permanently profitable businesses in the world.
So where did Carly succeed and where did she fail ?
1) Success
2) Success too, but too late for her to see. She had already been shown the
door.
3) Success. Too bad good products had to be abandoned in the process, but
choices are choices.
4) Tie. The company was really reorganized along a new paradigm more aligned
with the business, but the internet bubble burst almost doomed the entire
effort.
5) Failure. Big-time ! She antagonized too many HP insiders to succeed in
the long term. That's probably what ultimately brought her down.
6) Failure too. Same causes, same results. Too many ruffled feathers. She
probably went too fast, too far.
7) Failure. She failed her Ernst and Young deal. The irony is that her exact
strategy finally succeeded weeks ago, with the EDS deal, that finally sees
HP become a really big player in IT services.
OK, we can complain about the end of the 3000 until hell freezes, but that's
not going to reverse the decision. So let's put the past to rest and face
the future. I, for one, would probably have been glad NOT to be forced into
a change, but I guess a change was inevitable in the first place. So I
hopped on the train of change before it had caught too much speed for me to
jump on. That allowed me to change my job gradually, without the added
trauma of being an excellent, and totally unemployable, MPE specialist.
It's now time for a few disclaimers and explanations :
- I'm trying my best at reading Carly's, and HP's, strategy, over a period
of time. I'm not judging, I'm not condoning, supporting, condemning, etc.
Just trying to understand.
- I've been an HP employee for a while (1984-96) and I've been part of the
HP ecosystem for most of my adult life, since 1981 to be precise. While that
does not give me any specific competence, I've been allowed to witness a few
things.
- My background is not in computers but in business (graduate business
school, etc.). That explains why I can recognize a business strategy when I
see one.
- I did not invent or make up anything. I just read the press, read this
list (among other sources), and used only publicly available material.
- Though I met her face-to-face 4 or 5 times, I've never been a Carly
insider, and I've never had any specific access. Just opportunities that I
decided not to skip.
My point is simply this : whether Carly personally decided to kill off the
3000 (perhaps she was presented a list of possible targets that could be
axed, and it included the 3000 and she okayed the it, I don't know), or not,
that's moot. It had to go anyway, and it would have gone, sooner or later.
Carly or not Carly. Its ultimate demise was simply somehow hastened by
external industry trends (standard is in, proprietary is out), business
decisions (the Compaq merger), and bad economics fundamentals (the internet
bubble sucking up preciously needed cash).
In other words, while Carly's tenure at HP produced mixed results (see my
scorecard above), she may or may not have killed the 3000, and it just does
not matter.
Thanks for reading that far.
Christian
'somewhere in Old Europe'
> -----Message d'origine-----
> De : HP-3000 Systems Discussion [mailto:[log in to unmask]] De la part
> de Denys Beauchemin
> Envoyé : dimanche 15 juin 2008 21:33
> À : [log in to unmask]
> Objet : Re: [HP3000-L] Carly in the news
>
>
> Ok. I forgot. What did she do exactly to those who were loyal to the
> HP3000 platform? Are you under the delusion that she personally cancelled
> the HP3000?
>
> Denys...
> -----Original Message-----
> From: HP-3000 Systems Discussion [mailto:[log in to unmask]] On Behalf
> Of Ron Horner
> Sent: Saturday, June 14, 2008 9:36 PM
> To: [log in to unmask]
> Subject: [HP3000-L] Carly in the news
>
> Gee, think of that. When all the time that Carly didn't care what common
> people had the say, now she needs even the people who she destroyed. We
> should campaign against whoever she is backing.
>
> We should never forget what she did to so many who were loyal to the
> HP3000
> platform.
>
> http://news.yahoo.com/s/nm/20080615/pl_nm/usa_politics_mccain_fiorina_dc
>
> Ron Horner
>
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