HP's Fiorina doesn't get Valentine from Board, quits.
I've been tracking the performance and strategic management of HP CEO Carly Fiorina as I've watched her steer Hewlett-Packard further and further from the path of success in the challenging personal computer and peripheral industry. I've talked about Fiorina's rift with the Board, HP's dispute with Apple about the iPod, and HP saddles PC division to printer group, among other topics.
To reiterate, though, it was her reinvention of the company as a centralized management hierarchy, after decades as a loose collection of mostly autonomous divisions, that began concerning me, then her decision to saddle the successful printer division -- typically viewed as the bright spot in the HP portfolio -- with the failing personal computer division, rather than jettison the completely commoditized business. The acquisition of Compaq was really the beginning of the PC debacle at HP, not changes in the industry, but that's another topic entirely.
The news this morning is that Fiorina came into work, issued a press release, and walked out: "While I regret the board and I have differences about how to execute HP's strategy, I respect their decision," said Fiorina in the press release.
Here's what bothers me about this: There's no transition plan.
The growing rift between Fiorina and the Board has spilled into the media over the last few weeks, but her abrupt departure just reinforces what us industry analysts have been saying about her tenure as CEO of this blue-chip firm: characterized by lack of leadership, professionalism, and long-term strategic thinking.
And now HP's flailing, assigning CFO Robert Wayman to be interim CEO (the last thing HP needs is an unimaginative bean counter steering the ship) and Patricia Dunn as non-executive chairman / chairman of the board. Without a transition plan, without at least a week or two for the Board and CEO to responsibly work together on how to get through this transition period, this is going to be a problem for the company in the shorter term.
Ironically, though, HP's stock is up 11% on news of Fiorina's departure.
I'm glad Carly Fiorina has resigned as CEO of Hewlett-Packard, I think she's done a poor job of managing and leading this great company and am excited to see what HP "invents" for itself as it survives this textbook study in poorly managed transition events.
Update: Two additional items of data have surfaced as the day has proceeded. First, the Board of Directors apparently asked Fiorina to resign, so it wasn't so much that she offered to step aside at all. Second, and this is one of those stories of how CEOs just live different lives to you and me: The Wall Street Journal is reporting that Fiorina's severance package is going to be $21.1 million. Nice work if you can get it.
Posted by Dave Taylor at February 9, 2005 8:00 AM
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