HP's Appointment of German CEO Draws Criticism
October 1, 2010 10:25 AM
comment(s) - last by
HP faces criticism for its appointment of Léo Apotheker, former CEO of struggling German software giant SAP AG, to its chief executive post.
Company's stock takes a hit amid uncertainty; new CEO's former firm struggled under his leadership
Say what you will about former Hewlett Packard Company CEO and
new Oracle Corporation co-President
, but he was a brilliant and dynamic leader at HP. Following Mr. Hurd's ousting in August, HP has at last
named a new CEO
-- and it is a relatively surprising pick.
HP has named Léo Apotheker, 57, for the post. Mr. Apotheker comes to HP after over two decades in management at German software giant SAP AG. SAP AG appointed Mr. Apotheker to the post of deputy-CEO in 2007, and he would in 2008 be made co-CEO.
Mr. Apotheker comes from a diverse background. His parents were Polish Jews who fled to the Russo-Chinese border after Germany's invasion of Poland in 1939. In 1953 they returned to Europe, settling in Aachen, Germany. Mr. Apotheker is fluent in five languages -- English, French, German, Dutch and Hebrew.
The new CEO is no stranger to American hardware/software giants. He served at IBM and SDS prior to joining SAP.
Despite that experience, some are dismayed that HP picked Mr. Apotheker. One European investor called the decision "idiotic", while a veteran U.S. software executive is
as calling the decision "astonishing".
The criticism boils down to a few factors. First, SAP sells to businesses primarily, and does not have heavy consumer sales. HP, on the other hand, does sell to businesses, but relies heavily on consumer sales. Secondly, SAP has suffered a downturn during Mr. Apotheker's stint at CEO, falling further behind IBM and Oracle (some say that this was not Mr. Apotheker's fault, as the damage was already done). Last, but not least, the pick of a foreign CEO always has the potential to create a culture clash, even at a company as internationally diversified as HP.
Since the announcement HP stock has dropped from around $42.50 at Wednesday's market close to $40.85 today -- a loss of 3.9 percent market value. Skepticism is the best way to describe investors' sentiments at the present.
The move relieves interim CEO Cathie Lesjak from the company's top position, letting her refocus on her chief financial officer post.
It also serves as another example in the growing trend of international companies to pick foreign CEOs. In September Nokia
appointed former Microsoft Canada executive
to CEO, replacing Finnish CEO
Olli-Pekka Kallasvuo. Mr. Elop is Nokia's first non-Finnish CEO. While the HP and Nokia appointments are similar, an important distinction is that Mr. Elop hails from a wildly successful company, while Mr. Apotheker comes from a contracting one. Hence, HP's move will be greatly scrutinized perhaps more for what kind of company they picked their leadership from, rather than
they picked their leadership from geographically.
HP is the world's biggest technology company with regard to revenue. Only Microsoft and IBM post greater profits that HP, and only a handful of companies have a
higher market cap
This article is over a month old, voting and posting comments is disabled
10/1/2010 1:58:38 PM
I got news: All coorporations are like that. If you don't keep the investor happy, you get dumped as CEO, remember? And teh investor couldn't care about 10 years down the road.
10/1/2010 3:14:37 PM
A good CEO can keep investors and employees happy. Hurd managed the former but not the latter - morale in the toilet there according to my contacts.
10/1/2010 3:26:35 PM
I completely agree with your first statement. The issue with Hurd was the market eventually didn't agree with his strategies. He initially bumped the shares up but they eventually leveled and slowly declined. HPs major competitors have had their shares steadily increase over the last 5 years. The Street is smart!
"I'm an Internet expert too. It's all right to wire the industrial zone only, but there are many problems if other regions of the North are wired." -- North Korean Supreme Commander Kim Jong-il
Mark Hurd Settles HP Suit, Leaves Sex Scandal Behind Him
September 21, 2010, 10:36 PM
Former Microsoft Exec to Take Over as Nokia CEO
September 10, 2010, 9:22 AM
Woman Named in HP Scandal Had "Intimate" Past
August 8, 2010, 8:37 PM
UPDATED: Apple Deposes Microsoft to Become World's Biggest Tech Company
May 27, 2010, 9:41 AM
"Prepare to be Punished": Microsoft is Killing OneDrive With Cuts, Blames Users
November 3, 2015, 8:23 PM
Apple's New "Magic" Peripheral Line Packs High Tech, High Prices
October 13, 2015, 9:39 PM
Samsung Adds 2 TB 850 EVO, PRO SSDs for $800, $1000
July 7, 2015, 4:23 PM
Seagate Senior Researcher: Heat Can Kill Data on Stored SSDs
May 13, 2015, 2:49 PM
How to Recover Most Apps After Your NVIDIA Driver Crashes in Windows 10
March 30, 2015, 12:54 PM
Tinkerer Gets Old School Mac Plus Running on the Modern Web
March 24, 2015, 6:41 PM
Most Popular Articles
Free Windows 10 offer ends July 29th, 2016: 10 Reasons to Upgrade Immediately
July 22, 2016, 9:19 PM
Top 5 Smart Watches
July 21, 2016, 11:48 PM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2016 DailyTech LLC. -
Terms, Conditions & Privacy Information