Essays on New Leadership, New Opportunities for Hewlett Packard Case Study

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HP The merger between Hewlett Packard and Compaq was difficult. Both companies had different priorities and different management styles. It took sometime for HP to find its footing again following the merger. Several quarters of poor results led to the departure of the visionary CEO Carly Fiorina, and her replacement by Mark Hurd, the CEO of NCR Corporation, another technology company that had once been a part of AT&T. Hurd was seen as an outsider, and he brought a slightly difference management style with him when he came to HP. So far he has had a somewhat controversial tenure as CEO of HP and it has been interesting to watch. When Hurd arrived at HP it was clear he emphasized decisional roles.

His request that HP employees take a 5 per cent salary cut because of the company’s slow growth was seen to be heavy-handed by many employees and a policy that was not implemented with a lot of interpersonal consulation. Although he himself has taken paycut, many employees are probably more proportionally affected by their own cut, then he is by his.

This has stirred up some discontent at HP. Nevertheless, this method does get results more often than not. There is certainly an argument to be made that HP requires strong leadership, and that to exert it Hurd will need to use all of the levers of control to effect change and continue to improve HP’s competitiveness. He will need to know what is happening at all times using the various diagnostic tools available to him; but he will also need to exert control over some rowdy employees by communicating a core vision for the company and promoting it within the different levels of management.

Encouraging feedback in another lever Hurd can use to ensure a smooth flow of information up to the top, where he will especially need it as the global economy continues its freefall. Hurd’s appointment as HP CEO raised some eyebrows because he was an outsider. Bringing in an outsider has its strengths and weaknesses, but in this case, it appears to have been a positive. Although Hurd didn’t work for HP before, he did work for another technology company—he was not so much an outsider as someone who, for example, had run a professional football team.

An outsider brings a fresh set of eyes to the problems a company faces. If all promotions are always done in-house, the blood of a company gets tired. Hurd may have his work cut out for him, but he appears to be on the right track.

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