Hewlett-Packard Co.'s decision to fire CEO Leo Apotheker after just 11 months and replace him with former eBay chief Meg Whitman is another dizzying turn of the executive merry-go-round at a company whose leadership issues are tearing it apart.
Swapping Apotheker, who has now been ousted from two high-profile CEO jobs in two years, with Whitman, a billionaire who is best known for the decade she spent building eBay and her run for California governor, is a decision designed to stem investor fury over a series of questionable strategy moves.
Whitman's star-power could be an asset for a company that struggled to gain credibility under Apotheker, who was previously little-known outside of the business software world. HP is no stranger to celebrity CEOs. But Carly Fiorina's run as leading lady, from 1999 to 2005, ended in shambles.
Despite Whitman's success at eBay, she is untested when it comes to running a sprawling company such as HP. Full article
On a conference call today in which Whitman and HP Chairman Ray Lane spoke, one analyst suggested that investors have obviously lost confidence in the company's board. Lane gave the following emotional response:
"I'm going to give you an answer right from my heart. It's going to come right directly from my heart.
"In January I added five board members to this board. This is not the board that was around for pretexting. This is not the board that fired Mark Hurd. This is not the board that did everything you want to write about that the press writes about every day. It's just like open season to write about this board. It's not this board."
Update 4:35 p.m. Perhaps this is the kind of thing that Lane is talking about. From James B. Stewart in today's NY Times:
Interviews with several current and former directors and people close to them involved in the search that resulted in the hiring of Mr. Apotheker reveal a board that, while composed of many accomplished individuals, as a group was rife with animosities, suspicion, distrust, personal ambitions and jockeying for power that rendered it nearly dysfunctional.
Among their revelations: when the search committee of four directors narrowed the candidates to three finalists, no one else on the board was willing to interview them. And when the committee finally chose Mr. Apotheker and again suggested that other directors meet him, no one did. Remarkably, when the 12-member board voted to name Mr. Apotheker as the successor to the recently ousted chief executive, Mark Hurd, most board members had never met Mr. Apotheker.
HP shares were down nearly five percent on the market today.
One person who thinks the move is just swell: Carly Fiorina, one of Whitman's predecessors as HP CEO and her co-loser last November in big statewide elections. She conveyed her congrats today via Tweet:
In terms of Whitman's political career, or lack of it, KQED Sacramento Bureau Chief John Myers says that when he talked to her shortly after the gubernatorial election, she seemed hesitant to ever run for office again. Myers says today's announcement feels like an affirmation of that.
Update 3:35p.m. Check out this prediction from tech psychic Robert Cringely, dated Feb 23, 2011.
I don’t think Leo Apotheker is going to survive long as CEO of Hewlett Packard. This is not based on any inside information, just my own pondering. And when Apotheker does go down, I’m pretty sure I know who will take his place...
Then there’s Meg Whitman, who expected at this point to have resigned from the HP board to spend all her time running California as governor. But that didn’t happen, so now what is she to do? You can only get so many pedicures. She’ll eventually get around to hip-checking Apotheker and taking his job. Meg can knock back brewskies as well as any man and will probably fill those CEO shoes even better than Apotheker.
Yesterday news broke that HP was thinking of dumping CEO Leo Apotheker and replacing him with Meg Whitman, who slummed it as the GOP gubernatorial candidate before making a billion as the CEO of eBay.
Today, Kara Swisher of AllThingsD is saying the switch is nearly a done deal:
Former eBay CEO Meg Whitman is poised to be named the new CEO of Hewlett-Packard later today after the markets are closed, said multiple sources close to the situation.
The full board of HP, which is meeting today in Silicon Valley, has not officially voted on move and the situation could certainly change, sources said it is nearly a done deal. Full article
The market can't seem to make up its mind whether this is a great thing, a good thing, or a no-thing. HP shares shot up yesterday when the news broke, but lost much of that gain during the day and after-hours.
Maybe coverage like this has something to do with that ambivalence: