Putting lipstick on HP’s PSG

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Robert van Mann keeps on trucking

Divest for success!

Back in the day, HP was a revolutionary place to work.

From its garage days developing oscillators to a multi-billion dollar company, HP was formed on the egalitarian principles of founders David Packard and Bill Hewlett.

The so called “HP way” was different on so many levels to the corporations that went before it in both management objectives and techniques that made it both an innovative and exciting place to work.

Unlike many corporations today, it was also a very ethical place as well as an environment where the workers felt valued and part of the process of success. Feeling the guilt for all those lucrative defence contracts meant that many charity coffers were filled by HP donations over the years.

But for the last few years, HP seems to have lost its Way and hasn’t really been the same since uncle Lew (Platt) turned off the lights and entrusted the keys to the castle to Carly Fiorina.

Carly-ito’s way was not the HP Way and together with the acquisition of Compaq and a massive proxy battle with Walter Hewlett, son of Bill, Fiorina’s strategy as been largely blamed for the situation where HP finds itself in today.

HP has almost been in perpetual restructuring mode since then and
despite new CEO Meg’s recent appeals for calm, as nearly $10 billion hemorrhages from the books, it seems clear to many industry watchers that HP needs to do something drastic like divest its PSG business.

With the steady decline of PC Shipments and even server shipments falling, the warning from Walter Hewlett is still probably ringing in the ears of the current board that the Compaq deal was a “strategic error”

And the channel has known for a long time that it isn’t going to make a future living from shifting tin.

Without putting further lipstick on the PSG, HP should
focus on the growth areas of its business like software and services and help its channel transition into the emerging needs of the cloud economy.

It, dare I say, should perhaps also take a leaf out of Dell’s book in the way that it has made some shrewd acquisitions and given its channel more opportunity to go after the enterprise customers.

You were radical and revolutionary once. Let’s do it again, eh?