Whitman's political obsessions spell disaster for HP
New chief executive already active as fundraiser for GOP presidential race
Hewlett-Packard is a mess.
The world's largest computer maker has lost its sense of direction under a series of incompetent, overpaid visionless CEOs and a board of directors that outdoes Yahoo's for hapless dysfunctionality.
HP shareholders saw the value of their holdings plummet during Leo Apotheker's brief tenure as chief executive. They're worried -- and rightly so -- that the company may not reverse its slide toward irrelevance as the mobile and cloud computing eras unfold.
What the shareholders want -- and what HP needs -- is a fully engaged chief executive who is focused on devising and executing a turnaround plan that isn't all about layoffs and cost-cutting. In other words, someone who takes the time and effort to understand HP's business, its strengths, its weaknesses, its assets.
Does this sound like that person to you?
From the Wall Street Journal:
New Jersey Gov. Chris Christie, who has kept the political world in suspense for weeks over his presidential intentions, told prominent California fund-raisers and donors as recently as last Wednesday he had no plans to seek the White House.
One assurance took the form of a pledge Mr. Christie made to Meg Whitman, the newly appointed Hewlett-Packard Co. chief executive, said two people familiar with the matter. As a condition of Ms. Whitman's hosting a high-priced fund-raiser for him, Mr. Christie said he wouldn't enter the Republican presidential contest, these people said.
The WSJ goes on to note that Whitman is a "prominent supporter" of GOP presidential contender Mitt Romney. Last Wednesday Whitman and her husband hosted a $15,000-per-couple dinner at their Silicon Valley mansion for Christie and other wealthy political contributors.
The mistake that this article makes is assuming that purely business decisions are what make or break large corporations these days. When it is, in fact, quite clear under the current system that politics can greatly determine such a corporation's success. Companies that play the game well, like GM, can get away with a shoddy performance on the business side of things; and companies that try to stay out, like Microsoft in its earlier years, simply cannot.
Because, you know, Whitman's already got things under control at HP, so she has plenty of time and energy to devote to politics!
Which, of course, is a joke. Whitman's been at the helm of HP for a week, and already it's clear that her mind's not on the job. It's on presidential politics -- or more precisely, the role she can play in presidential politics.
None of this should be a surprise to the board. Like many wealthy people with large egos and strong opinions about "how things should run," Whitman has been bitten by the political bug. The former eBay CEO spent $144 million of her own money to finance her failed bid for California governor two years ago, a record amount for self-funded candidates at the state or federal level.
Now, less than two years later, Whitman has been entrusted by the HP board to lead the company out of the woods. But the board made a huge mistake, and not just because Whitman, who has been a director for less than a year, knows little to nothing about HP's business. Nor because she ended up making a mess of things at eBay after riding the Internet rocket to riches when the online auction company enjoyed first-mover advantage and no real competition.
The real mistake the board made was not understanding that Whitman no longer is in the CEO business. She's now a fully committed political gadfly, with political ambitions of her own. The HP gig is to her as a waiter's job is to an aspiring actor: A means to an end, and nothing more. And the purpose of the HP gig is to keep her in steady contact with other powerful and wealthy people, and to keep her resume fresh for that next run for office.
You can be assured that when Whitman sits in her HP office, she's not pondering how to increase margins on blade-server sales to SMBs. She's much more likely to be reading Fox News and Politico online, talking to Republican fund-raisers, and offering advice to GOP strategists. Whitman wants to be a kingmaker now and, eventually, a political queen.
Whitman's political activities will accelerate along with presidential campaign. That's obvious. This is what the HP board signed on to. It should have known better.
And HP shareholders definitely deserve better.