April 23, 2013, 11:43 AM — As someone who spent billions with HP over 20 years while in IT leadership roles at Boeing and Verizon Wireless, John Hinshaw knew the big hardware, software and services company from the outside as well as anyone. In the year and a half since becoming executive vice president of technology and operations at HP, he's been putting that knowledge to use on the inside.
Hinshaw, who I spoke with last month at an HP analyst meeting in Boston, became part of CEO Meg Whitman's team shortly after she was hired in the fall of 2011 to lead HP's latest and very challenging turnaround effort amid big changes in the PC and server markets. Her vision for HP internally was one with which Hinshaw agreed -- to marry the company's IT function better with other inside operations including sales, procurement, shared services, real estate and physical security. Technologies that HP is pushing as a vendor -- cloud computing, software-defined networking, Windows and Android tablet computers, etc. -- are already playing a big role in this internal IT strategy shift.
"What I'm tasked with doing for my organization is to make it easier to buy from HP, easier for our employees to sell HP products and easier to work for HP," Hinshaw says.
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While Hinshaw's responsibilities are broad ("It keeps me out of trouble"), he spent two-thirds of his time during his first nine months on the job on the tech side and put a team in place that includes CIO Ramon Baez (from Kimberly-Clark), and reporting to Baez, CIOs for HP's various business units. Overall, Hinshaw's team includes 32,000 people and 15,000 contractors (including everyone from security guards to cafeteria workers), and about 9,000 of these people are in IT.
"These business unit CIOs wake up every morning, like the CIO for the enterprise group, and focus on how to make that business better ... whereas in the past, all requirements for IT would flow up into some big prioritization [list] and little would get done," says Hinshaw, who now spends about a quarter of his time on IT issues.
The company's IT strategy previously was focused too much on activities such as data center consolidations and application rationalization, "which save money but don't enable the business to be successful," Hinshaw says.
Not that cutting costs isn't a huge deal for HP, which is trying to slash up to $3.5 billion via a corporate restructuring/layoff plan outlined about a year ago.
"Clearly, a lot of what we're doing is taking cost out -- not from IT ... my organization's budget is actually up year over year," Hinshaw says, "but taking costs out of inefficiencies within our business."
This is where HP's aggressive adoption of cloud computing comes in. The company has bought into cloud services from, among others, DocuSign, Fieldglass, Salesforce.com and Workday.
Hinshaw speaks highly of Salesforce.com CEO Marc Benioff ("a great thinker") and says HP holds the title of Salesforce.com's "largest and fastest implementation" by rolling out the software-as-a-service offering to 30,000 sales reps over eight months. Salesforce.com has boosted productivity while cutting costs at HP, he says. [Here's a link to a video of Hinshaw speaking with Benioff at a Salesforce.com event]
And by using DocuSign, an electronic signature technology, HP has sliced the time taken to sign up new partners from five weeks to five days, Hinshaw says, adding that HP is DocuSign's biggest customer.
"There have been efficiencies that require fewer people to execute processes," Hinshaw says. "We said we were going to let 29,000 people go ... well you have to invest in automation and process in order to do that."
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Naturally, HP is using its own cloud products -- in combination with its ballyhooed Moonshot server technology. "A lot of marketing collateral and things of that nature in the past has been hosted in the public cloud in places like Amazon and Rackspace because HP didn't have its own public cloud. We're now moving those workloads into HP's cloud as well. Then we have our internal cloud for a lot of apps we run that's based on HP CloudSystem," he says.
HP, which is a big supporter of the OpenStack cloud technology, is also optimistic about using and delivering hybrid cloud technologies.
Trust is key before HP moves anything into a public cloud service, and the company conducts exhaustive security reviews. "This is a broad statement, but the cloud is often more secure than an individual company where you have many access points, many data centers, many servers, a very distributed environment, whereas with the cloud you know exactly where it is, what your controls are," Hinshaw says.
However, some core financial systems, such as SAP enterprise resource planning apps, and certain manufacturing apps aren't quite there in the cloud yet, Hinshaw says.
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On the networking front, HP is a dedicated user of its own products (including the former 3Com gear) and is beginning to use software-defined networking technology.
"Having spent my whole life building data centers and network environments in one methodology and now thinking wow, you can actually separate the control plane from the data plane and have specific applications optimized for certain network paths all through software, that's amazing ... I wish I had that 20 years ago," Hinshaw says. "Now we're going application by application to figure out how to prove that out. We've done some work already on hp.com using SDN and we're now lining up the next applications to go there."
Briefly donning an HP marketing hat, Hinshaw opines: "When you think about SDN, it's a big threat to companies like Cisco because their bread and butter is to sell more gear. And this is more about optimizing the gear you have and the applications you run on it."
In concluding our meeting, which took place amid rising shareholder discontent and shortly before Ray Lane stepped down as chairman, Hinshaw said: "There's a lot of good to tell about HP. Unfortunately, some of the strategic decisions did cloud that for a little while, but the great thing about Meg [Whitman] is that she's incredibly transparent and very clear about what isn't working well, dealing with that and saying here's where we're headed. It's going to take a little time and there's lots of work to do, but we're starting to see the early returns."
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