Anders and Forbes re Bradley

Contributor  

              George Anders   Consultant, Forbes

               

6/18/2013 @ 9:42AM PDT

 HP Moves Bradley Aside, Taps Weisler To Run Consumer Unit

Hewlett-Packard has a new head of its market-leading printing and personal systems business:Dion Weisler. He’s a former Lenovo executive currently working for HP in Asia. As for Todd Bradley, the long-time head of HP’s printing and personal system business, he remains in HP’s executive council, but won’t control nearly as much revenue.

In announcing the management shuffle, HP’s chief executive, Meg Whitman, hinted that she is looking for better operating performance from the big PPS group. She referred to Weisler “one of our very best executives,” adding that “his background is perfect, given the challenges that we face in the marketplace.”

When HP last month reported its results for the quarter ended April 30, the company showed a 1% decline in printing revenue and a 20% drop in personal-system revenue. The double-digit slippage reflected the waning appeal of PCs and notebooks as consumers increasingly gravitate toward tablets and smartphones. Overall operating earnings for printing and personal systems declined just 10%, to $1.2 billion, as Bradley and his team largely kept costs in line with waning demand.

But HP didn’t make as much progress as some might have wanted in building up its own mobility-based offerings. For the quarter, HP showed just a 17% growth rate in revenue, to $242 million, for  “other” products in printing and personal systems. That’s the category in which tablets and other mobility products are grouped.

If HP can’t improve on that growth rate, it would take 16 years for its mobile devices and other products to achieve the $3.1 billion in quarterly revenue currently posted by desktop computers. Whitman and the board probably aren’t that patient.

The new head of HP’s printing and personal systems group, Weisler, joined HP in January 2012. He previously was chief operating officer of Lenovo’s product and digital mobile internet digital home groups. Raised in Australia, Weisler earlier had worked at Acer for 11 years. Lenovo and Acer are two of HP’s leading competitors in the personal-computer and notebook markets.

Bradley will move to a new job as executive vice president for strategic growth initiatives. The company said he will focus on enhancing HP’s business in China and extending channel partnership relationships around the world. He also will work with Whitman on trying to partner with early stage companies that can aid HP’s growth.

Bradley had joined HP in 2005, after having been chief executive officer of Palm. He started as head of the personal systems business — a high-volume, low-margin, highly competitive business that is one of HP’s main presences in the consumer market. Last year, Bradley also took on oversight of HP’s other main consumer-facing business: printing.

At the peak of his influence, Bradley ran businesses with $65 billion in annual revenue. That’s  slightly more than half of HP’s overall revenue.

News services are hot re Bradley, here's a 2nd look

Arik Hesseldahl at All Things D

What’s Behind Todd Bradley’s Move at HP?

JUNE 18, 2013 AT 9:50 AM PT

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The unexpected shift of Todd Bradley from leadership of Hewlett-Packard’s $60 billion Printing and Personal Systems Group has, at first glance, all the markings of the kind of change that would have Bradley preparing for a move outside the company. There have been persistent rumors that Bradley may be talking about a role, perhaps as CEO, at Dell.

Sources familiar with the situation and thinking behind the move tell AllThingsD that Bradley has told HP CEO Meg Whitman, “firmly and emphatically,” that he has not been contacted by Dell.

This view has been confirmed by sources at Dell, who say there is “no job” for Bradley at that company.

The speculation is understandable. Bradley is a respected senior executive who was once CEO of Palm and has been considered a favored candidate for HP’s top job no fewer than three times. During the period when former CEO Léo Apotheker was planning to spin out HP’s PC operations, it was hard to find people betting that Bradley wouldn’t be its CEO. At one time, he was even on the list of candidates to replace Paul Otellini at Intel. The challenging business conditions at Dell — on its way to a $24.4 billion leveraged buyout on which shareholders will vote next month — might represent, some would argue, the perfect opportunity.

Here’s how the rumor — presented now only because, even untrue, it makes a certain amount of sense — breaks down: Bradley might have been in line to be CEO of a newly private Dell, while Michael Dell would return to his role as chairman, which he held from 2004 to 2007. Bradley’s new title at HP — executive VP for Strategic Growth Initiatives — is the sort of nebulous post that occasionally is given to an executive who is short-timing it. It might appear to be something along the lines of the “iffy” product-innovation role that Jon Rubinstein had after he stepped back from running HP’s now-defunct webOS unit, the job he held until he left HP for good last year.

But, on its face, there is nothing “iffy” about Bradley’s new gig, sources tell AllThingsD. HP’s channel relationships — the business it does through a global network of resellers, who in turn sell HP products and services directly to businesses — have been badly frayed in recent years.

It’s a crucial segment, making up as much as 70 percent of HP’s business overall. Channel sales account for about 80 percent of HP’s sales in the Printing and Personal Systems Group, and about 60 percent of sales in the Enterprise Group. Bradley’s brief will be to repair those relationships, especially in China. “Frankly, Bradley has relationships there that Whitman doesn’t have,” said one source familiar with HP’s operations. “If there’s anyone who can do the work to get the channel back on track, it’s Bradley.”

Yet there’s another potentially important clue: HP’s announcement doesn’t name any executives reporting to Bradley in his new role — only that he will be reporting directly to and working with Whitman.

One source familiar with the company’s plans said that will change soon, and Bradley will name key lieutenants in the new effort in the coming weeks. “He will be able to reach across the organization,” one person said. “He doesn’t need many folks to accomplish anything.”

The source also described growing pressure on Bradley and other executives within the Printing and PC unit to show results, despite what has turned out to be a historically bad period for PC sales in particular, one that will eventually lead to a significant retrenchment. In its most recently quarterly filings, HP’s PC unit reported a 21 percent year-on-year decline in sales, from $9.2 billion to $7.3 billion, and saw its profit margin drop from 5.6 percent to 3.3 percent.

“The pressure on Bradley from Meg has been at an all-time high,” one source said.

Bradley didn’t immediately respond to messages.

Whitman said in an interview with AllThingsD last week that she’s happy about the stabilization that has taken place in the printing business in the last year. Printing revenue, at $6 billion, was essentially flat versus last year, while profit margin rose from 13 percent last year to nearly 16 percent. Bradley took over printing from its previous head, Vyomesh “VJ” Joshi, as the result of a significant restructuring in March of 2012.

Whitman is said by sources to want a set of “fresh eyes” on the personal computer business. That’s where Dion Weisler comes in. Currently heading up HP’s printer and PC sales for the Asia, Pacific and Japan region, he has 23 years of IT industry experience running Asian business units for Acer and Lenovo. However, despite that history, he’s considered a bit of an unknown, and has been suddenly elevated to the very top of HP’s operating structure. His role will include a seat on HP’s Executive Council, the most powerful and senior set of executives within the company.

Bradley breaking news

This just came across the wire... gosh, after my post about HP declining the HP Pavilion naming rights for the San Jose stadium (and Bradley being the "sports buff" at HP), was that a precursor signal?  Some of you may recall that Bradley was the CEO at Palm until 2005; Hurd brought him to HP to galvanize PCs and separate them from printers.  Bradley's style was very compatible with Hurd, and his tenure with PCs was viewed as largely successful for the first three years.  He also engineered the later purchase of Palm from the VC firm who bought it after he had left.   Jon Rubinstein (see last week's post re Jon's lament) was brought in by the new VC team to replace Bradley's open post.

Of late, of course, the PC business (and printers) has been desultory or worse.  Maybe it caught up with Bradley?  

Jun 18, 2013, 11:42am PDT

No CEO post for Bradley, here's what HP shakeup may mean

HP's Todd Bradley has a new job, just not the one anyone was expecting for him.

Cromwell Schubarth

Senior Technology Reporter-Silicon Valley Business Journal

Hewlett-Packard honcho Todd Bradley has a new job, but not as a CEO despite persistent talk in recent years that would be his next move.

HP CEO Meg Whitman announced on Tuesday that Bradley, the head of the tech giant's biggest unit, is becoming executive vice president for strategic growth initiatives.

That's the kind of title one usually gets when you are being moved out of the mainstream and is a far cry from the positions he has been rumored to be in line for in recent years. Amid the turmoil at the top of HP, Bradley has come up several times as a possible CEO there. He was also reportedly offered and turned down an heir apparent role at Intel and most recently was rumored as a potential CEO at Dell.

But now his job will be to improve HP's business in China and Asia, where it has been challenged by Lenovo since that Chinese company bought IBM's PC business several years ago.

He will also be in charge of building up HP's network of resellers, where relationships have reportedly been frayed by several years of turmoil and uncertainty.

Big jobs, but again not the kind of thing you might expect a 54-year-old executive with bigger ambitions to stay with for a long time.

Bradley is credited with building HP's PC and printer businesses into No. 1 positions since he left as CEO of PalmOne, mobile computing pioneer Palm's hardware unit in 2005. But PC sales have been in a steady decline and printers are growing less relevant, as well.

It was expected that Bradley would be CEO of that unit when ousted CEO Leo Apothekerannounced plans to sell or split off PCs and printers.

Now relative newcomer Dion Weisler, who has been in charge of printers and PCs in Asia-pacific and Japan since lat in 2011, will run the company's entire printer and PC business. He had been a top exec at Lenovo before that.

And Bradley will work on strategy and report to Whitman, at least for now.

Cromwell Schubarth is the Senior Technology Reporter at the Business Journal. His phone number is 408.299.1823.

ACM awards

ACM (Association for Computing Machinery) is the largest and most research-oriented professional society in the world, 108,000 members strong, just over 50% now outside the US.  They held their annual Awards banquet in San Francisco on Saturday night, a black-tie affair at the Westin St. Francis.

I was privileged to be president of this group fifteen years ago, a great learning experience for me to be sure, and chance to mingle with some of the most important architects of our Information Age.  These folk are the infrastructure builders -- the inventors of new algorithms, methods, techniques rather than the more celebrated CEOs and company founders profiled in Fortune or Business Week.

This year, Hans-J Boehm and Robert S. Schreiber of HP were honored as new ACM Fellows.  This is today a group of 770 specially acknowledged designers/researchers/inventors -- out of more than 2 million practitioners in the computer science field -- selected by a selective "Fellows committtee'.   So, to be named to this group is to be just 0.04% of the discipline.  Quite a noteworthy achievement.  It is also true that there are less than 100 "practitioners" in the set of 770, so to have two new HP folk in this group is especially noteworthy.

Historically, a few HP folk have been named to this -- Joel Birnbaum and Prith Banerjee, Rich DeMillo and myself -- plus a few others whose names escape me at the moment.  Some HP researchers, such as Josh Fisher in VLIW work, have won key prizes -- Fisher won the ACM-IEEE Eckert-Mauchly prize in 2003; Stan Williams has gained acclaim for the memristor (altho it is not now slated for commercial production),  

Boehm and Schreiber had earlier (2006) been selected in ACM's first group of "Distinguished Members" (see HP release by Jamie Beckett, November 2006), so they've been 'on the radar' for awhile.  Their work undergirds much of the HP enterprise work, including the new Moonshot series re memory management and high-perfomance operations.

Other recent HP researchers elected to the Distinguished Members list include Martin Arlitt, Sung-Ju Lee, Puneet Sharma, Parthasaranthy Ranganathan, Kimberley Keeton, Ludmila Cherkasova, Dejan S. Milojicic, Arif Merchant, and Michael Schlansker.

I've posted in my InnovaScapes blog (innovascapes.blogspot.com) a couple of notes re the ACM awards banquet; suffice here to say that it was refreshing to see some HP researchers acknowledged.  There's life in the old company yet!

HP, Palm, and Rubinstein

I missed this story yesterday, but think it well worth including in this blog -- CHH.  My comments below are in red.

Jun 12, 2013, 6:04am PDT UPDATED: Jun 12, 2013, 6:37am PDT

Former Palm CEO: I wish I hadn’t sold the company to HP

Luke Stangel

Contributing writer-

Silicon Valley Business Journal

Former Palm CEO regrets selling the company to Hewlett-Packard, saying, “talk about a waste.” In an interview Tuesday, Jon Rubinstein said he was frustrated with how HP hobbled, and later abandoned Palm’s webOS smartphone platform.

“If we had known they were just going to shut it down and never really give it a chance to flourish, what would have been the point of selling the company?” Rubinstein told Fierce Wireless.  (Well, one point might be that $1.2B was substantially higher than Palm's valuation at the time, and Roger McNamee and Bill Coleman wanted their money out....)

HP purchased Palm in mid-2010 for $1.2 billion, saving the company from what many believed was the company’s slow and inevitable demise. The company’s Palm Pre smartphone excited early adopters, but failed in the consumer market.   (For those of you who never tried it, the Palm Pre was WAY ahead of its smartPhone competitors, EXCEPT for the burgeoning size of the iPhone AppStore apps...  which had erupted in the previous nine months).

In the interview, Rubinstein blamed some of the Pre’s failure on Palm’s decision to sell the phone through Sprint, instead of Verizon Wireless.  (I'd agree, but the lack of apps at launch was a serious deficiency for the dynamics of the day -- Verizon couldn't change that)

“We were negotiating with everybody,” Rubinstein said. “And the Sprint deal was the best deal we could get at the time. Palm was dying when I got there. It wasn't like we had the pick of the litter.”

Rubinstein was a key executive at Apple, brought in by Steve Jobs in 1997 to lead hardware engineering. He’s widely credited with helping develop the iMac, G3 and the iPod. Palm hired him as CEO in 2009, and he led the company’s sale to HP a little more than a year later.  (Usually left out of these stories is the fact that Rubinstein started his career at HP in Fort Collins, CO.  He wrote a compiler for HP's 9836A workstation in 1977, which was a powerful personal computer years ahead of Apple and IBM, and never given any credit by such groups as the Computer History Museum.  Jon stayed several years at HP, but concluded that its computer operations were managed in a hopeless manner.  Some things never change?).

The Pre did things back in 2009—like over-the-air software updates, multitasking, notifications and unifying contacts with messaging—that were firsts were (sic) smartphones at the time. Today, those features are standard in iOS and Android.

HP launched the webOS-enabled TouchPad in mid-2011, but killed the product within months after the launch. The company later abandoned webOS, open sourcing it, then selling it to LG earlier this year in a undisclosed deal so small the transaction had no material effect on its revenue. (This is a bit of a snide aside -- the whole Palm deal, at $1.2B, was de minimus for a $132B company.  The tragedy is that WebOS was indeed superior, and one might have envisioned a future where it could have become the Android alternative as HP announced, but couldn't deliver on.  This has a lot to do, I think, with the infighting and dysfunctionality of the various product groups about interoperability.  The failure of the TouchPad in the marketplace --- well, we've covered that before.)

Rubinstein says Palm got a lot of things right, but those things weren’t enough to save the company.   “If you go back at look at our original premise for a lot of the stuff we did at Palm when I got there, I think it's all really played out as expected,” he said.

HP Falls Behind?

Steve Johnson, sjohnson@mercurynews.com, got a front page story in the San Jose Mercury-News  this morning, his headline breathlessly reporting that "HP falls behind on R and D spending: Share of company revenue devoted to research dwindles".

The story is actually lengthy, some sixty column inches, including a great graph of HP versus 19 other local companies.  another of HP's R and D decline from 11% in 1987 to 2.8% today, along with a table of the top R and D spenders in total dollars.  For those who haven't paid attention, this is a new and BIG story; for long-term blog followers, shareholders, and generally aware folk in the Valley, this is hardly new news.

See, for example, "HP R and D and Palmisano"  on 9/15/10 where I noted that:for the last three CEO's, here is the track record:
Platt reduced R and D percentage by 34% in seven years
Fiorina reduced it by 27% in five and a half years
Hurd reduced it by 47% in five and a half years

Johnson couched his story with Meg's promise to re-instore higher R and D levels, which has ever so slightly happened.  Actually, she has raised the percentage by a new trick -- cutting the revenue line a lot changes the denominator.

Still, the article is a good reprise of a fairly clear set of decisions at HP to de-emphasize innovation in favor of today's profits.  Every HP CEO since John Young -- yes, and three of them, Lew Platt, Carly, and Hurd - cut R and D big-time percentage-wise, EACH.  The cross-product of the three was a staggering 74.5%.  And the rub, as those cuts took place, in general, was that the 'further out' stuff gets cut rather than the 'close-in' stuff.  Most estimates, supported by the actual employment numbers at HP Labs, indicate that 80 to 90% of longer-range (i.e. more break-through ideas) were axed or allowed to lapse.

Even Phil McKinney defended the low numbers when he was the Innovation Champion, arguing that Apple only spent 2.2% on RandD, so why should HP need to spend more.  Well, one reason is that HP is not "big hit driven" in the way that Apple is.  Another just could be that Apple's model isn't all that effective for the long term either, as the Android crowd and others are putting much more pressure on the creative leader.  But Phil didn't have the team to finish the HP TouchPad, or to recast it when Apple's iPad clearly out-invented them.  He was dealing almost exclusively with outsourced R and D.

It was refreshing to see Johnson ferret out (with HP help) some 'recent' R and D contributions.  Sure, the scientific calculator, the first commercial LEDs, ultrasound medical detectors, and Hewlett's oscillator got billing, but so did the energy saving algorithms for IT centers, and some virus-thwarting software of recent years.  And notably, the low-cost laser and ink-jet printers weren't trotted out.  Nor were those ubiquitous logic analyzers,   But then again, of the ones Johnson mentioned, all but the last two software things were really Agilent, not HP, contributions.  And Agilent still spends 9.7% on their R and D investment, similar to Cisco at 11.3%.  Both are dwarfed by Intel's $10.1 billion, and 19% rate

Johnson accurately notes that such luminary organizations, with their 27 year old analysts, as Booz and Company, KPMG and Battelle, question R and D spending as a gauge to innovation prowess.  I much prefer Ron Enderle's succinct statement, "strategically, it's suicide"

Sign of the times?

Today's announcement that HP Pavilion will soon be renamed SAP Center had to have some head scratching.  Todd Bradley has long been HP's leading sports supporter at the Execom level -- is he losing favor?  Another signal was the HP sponsorship of the Byron Nelson Classic Golf tourney, when Keegan Bradley finished second, not first, and in the final twenty minutes of TV time, HP was not mentioned once on the tube, nor given the traditional option to hand over the trophy or anything.

Keegan is Pat Bradley's nephew, and no relation to Todd of which I'm aware.  But stranger things have happened.  HP used to design the sailboats for the America's Cup, back when HP had the leading workstations (and before King Larry started competing).  Wonder if the Thug is sailing this year?

And SAP?  What now?  Well, the initial news of course is that Hasso Plattner, the German founder of the German company, is part owner of the San Jose Sharks, and since the HP Pavilion is known fondly as THE SHARK TANK by all of the ice hockey fans, what a natural.  Plattner, you may recall, is actually a dedicated contributor to the Bay area, having funded the D'School at Stanford for David Kelley and team, much to Stanford's chagrin for awhile, but now they're pleased because Stanford B'school kids pick Stanford over Harvard thanks to the D'School reputation.

Another way to view the HP Pavilion name change, of course, is that HP needs the $3M or so per year that it costs to keep the name on the stadium, now that things have gotten so bad for this $120 Billion per year company.   Odds, though, are that HP's toilet paper bill is ten times the Shark Tank naming bill, so that doesn't ring too true.