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Move is a surprising one, given HP's relative disinterest in mobile

Hewlett-Packard Comp. (HPQ) has been struggling mightily over the last couple years with stock plunging from an early 2010 high of ~$52.50 USD/share to a late 2012 value of ~$12.50 USD/share.  Since that time, HP shares have more than doubled amid a general stock market surge and the steady leadership of new CEO Meg Whitman.  However, one central problem for HP remains -- the company lacks any cohesive strategy for mobility, even as the market shifts away from the traditional personal computer.  

HP has at times appeared defiant, insisting that it does not need mobile to survive.  In that light the news that HP has added Ray Ozzie -- former chief software architect of Microsoft Corp. (MSFT) -- to its board may seem a surprising one.  Just last year HP had been countering claims by Mr. Ozzie that the market was entering a "post PC" era.  Now they appear to be tapping his insight.

However the move follows recent direction changes at the personal computer giant, as HP has begun to soften on its abandonment of the mobile space.  After dumping webOS in Aug. 2011, HP for a long time largely overlooked the tablet and smartphone sector.  But earlier this year reports began to trickle out indicating that it was preparing a new device campaign, leveraging Google Inc.'s (GOOG) popular mobile operating system Android.

Ray Ozzie at Microsoft
Ray Ozzie [Image Source: Software Development Times]
 
The first result of that new look was the Slate 7-inch Android tablet, which debuted at $170 USD in Feb. 2013.  Despite that attractive price point, the tablet's much lower spec than the Nexus 7 ($199) ASUSTek Computer, Inc. (TPE:2357) has made it a slower seller than HP hoped.  The tablet is #857 in Amazon.com, Inc.'s (AMZN) computer device rankings, following a price cut to $144 USD.

HP is also rumored to be preparing an Android smartphone offering.

In his new post, Mr. Ozzie will join the board's technology committee and the finance and investment committee.  Under those roles he's expected to guide HP in acquisitions and R&D to make the company more mobile.

The company also added a couple of other prominent names -- Robert Bennett, former CEO of Liberty Media Corp. (LMCA), and James Skinner, currently the chairman of Walgreen Comp. (WAG) and former CEO of McDonald's Corp. (MCD) -- to its board, as well.

Source: HP



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To be or not to be number 857?
By drycrust3 on 7/15/2013 3:11:36 PM , Rating: 2
quote:
The first result of that new look was the Slate 7-inch Android tablet, which debuted at $170 USD in Feb. 2013. Despite that attractive price point, the tablet's much lower spec than the Nexus 7 ($199) ASUSTek Computer, Inc. (TPE:2357) has made it a slower seller than HP hoped. The tablet is #857 in Amazon.com, Inc.'s (AMZN) computer device rankings, following a price cut to $144 USD.

See, this is exactly the problem. It's like HP didn't really want to release an Android tablet, but felt it had to sort of try. Why a "low spec" tablet that sells at a loss and gets poor reviews when you could have just as equally sold a high spec one at a loss and get rave reviews? Ah ... the rave reviews!
In Milton Freidman's Book "In search of Excellence" he used HP (yes, the very same HP) as an example of Excellence, and one of the keys to that was the culture of innovation, prototyping and improvement, where teams of people worked to have a prototype of some potential product on display for everyone to look at and play with on Friday afternoon.
It seems to me, and I could well be wrong here, but it looks to me like the root of the problem is HP has lost the desire to have a culture of innovation, prototyping and improvement. The place where that culture starts is at the Board of Directors.
With a culture of innovation, prototyping, and improvement, HP wouldn't have been happy with releasing a low spec tablet, they probably wouldn't have let it out the door, or if they did they'd have quickly replaced it with one with a better spec (especially after a month of Friday afternoons with lots of prototype tablets being better than what they were selling); but without that sort of culture, then some in the company would have wondered why HP's engineers and marketing people, especially the "old timers" who remembered the old culture, kept annoying them with ideas about how to improve that tablet, like number 857 wasn't good enough or something. Yeah, why worry, isn't being number 857 good enough? No, actually, it isn't good enough.




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