HP is Not IBM

This isn't to say that Gerstner couldn't save HP - what he accomplished back in the 90's is a case study in turnarounds.  It's simply not the same environment today as it was in 1993.

There are, however, some spooky similarities between HP of today, and the IBM Gerstner inherited.

When Gerstner took over, IBM had just experienced an 8 Billion dollar loss - at that point, this was the largest corporate loss in history - their stock was down 6%.  Many pundits strongly recommended breaking IBM up into  "Baby Blues" - the breaking up of Big Blue, into little divisions and selling them off - being the only way IBM could survive.

IBM was the largest, most profitable computer hardware manufacturer of the day enjoying 40% margin on hardware. At the time, selling services was completely alien and new not just to IBM, but to an industry.

And that industry was dying.   These words from Business Week, 1992 -

"As the monolithic mainframe gives way, the industry breaks into leaner, faster, smaller parts...

It sure looks like an industry on the skids. The signs are everywhere and grow more painful every day: Worldwide leader IBM Corp. is shedding 40,000 workers this year, for a total of 100,000 since 1985. No. 2 Digital Equipment Corp. ousts its founder, after taking $3.1 billion in charges over two years to cut 18,000 jobs and vacate 165 facilities. Wang Laboratories Inc. files for Chapter 11 protection. France's Groupe Bull lays off 8,000 workers and closes 8 of 13 factories; Italy's Olivetti downsizes by 20%; Siemens Nixdorf plans to lose 6,000 workers. And the list goes on."

Gerstner incorporated a great deal of strategies, most remember and point to a few key unusual approaches that, today, are part of every company's 'come-back plan':

Get the rest on Walters & Shutwell...

Arnold.  1993 Movie -

HP to Report Biggest Loss in it's History...Setting the Stage for the Greatest Show Ever

Huge losses, massive layoffs, transformation on a global scale - and yet is seems more is needed.

How about creating a Mobility Practice and doubling, no tripling, no quadrupling down on a the consumer play and go after the BYOD crowd? With a tablet?  Knowingly competing with the iPad, iPhone, iWhatever?

Goodness.

Not my words, from Venturebeat:

"...It(the Q3 loss) is likely to be the worst loss since HP started in 1939. Chief executive Meg Whitman is still coming up with plans to turn around the company, after a year on the job. One of her initiatives is to cut HP’s staff by as much as 27,000 over a couple of years, recording a charge of $1.5 billion to $1.7 billion.

HP is banking on a revival for its PC business as Microsoft launches its Windows 8 operating system on Oct. 26..."

HP plays to the street, always has. So Meg is rolling a bunch of bad news into one announcement, a cleansing of sorts, the loss from EDS as well as the hit generated by layoffs and early retirement offerings presented for all to see. (Who gets to retire, with full benies nowadays at the age of 47?!!)

I am rooting for Old Blue.  I see a future for HP, there just isn't any printing involved; 3D or otherwise.

Read More...

HP Into A Perfect Storm? No. More Like Galactic Meatgrinder

I guess when others say it, it must be true.  I mean, if some guy with a blog and a leopard headband spouts off about "ignore this" and "Hawk" that, he's just a lone voice in the darkness, right?

Sure.

In a recent All Things D article, Arik Hesseldahl reflects upon analyst Chris Whitmore of Deutsche Bank Securities review of sales trends over the last 10 quarters at printer companies including Canon, Epson, Lexmark, Xerox and Hewlett-Packard.

Deutsche Bank calls the combined sales for equipment and supplies down 6 percent year on year.

Huh.


Let me outline a few of the high-points from Arik's retelling of the Deutsche Bank report:

Credit: Deutsche Bank

Supplies and equipment sales are down 6%, year to year

Six percent is significant

Sales of printer paper, A3/A4, fell 6% in the
2nd quarter to levels that are 20 percent below the 2006 peak

Interesting how paper sales peaked a year before the copier/MFP revenue peak of 2007(Lyra).

Read the rest ...

Who Owns MpS Now?

Two years a ago I was ringing the bell, exclaiming '...the OEMs where hi-jacking managed print services..." by angling to define MpS in their own likeness.

You remember, in 2008(ITEX), the second or third generation of MpS was in breach.

Back then, OEM MpS programs defined MpS/OPS as managing their devices, ignoring all others.

Everyone was scrambling to release a program. Xerox had PagePack 1.0, HP had OPS Elite, Kyocera had the "cheapest devices", Konica had OPS, OKI jumped in and Toshiba's MpS was one of the best kept secrets in the industry.

The pendulum swung hard right, all the way up to OEMs = MPS as they dictated their doctrine of either 1:1 refreshes or bundled lease and service.

That didnt work. They couldn't get their heads around the fact that ... the rest of the story...

MSFT to Bulid Surface: But What About HP? Karma Isn't Just an Electric Car

The MSFT Surface is making headlines all over as yet another software manufacturer steps into the hardware business, just...like...Apple.

Everybody is doing it - Google, MSFT...okay, not everybody.

As the usual technology pundits air out their sponsored 'opinions', am I the only one who is hearing desperate cries over at HP?

TheDeathOfWebOS Took Less than a 3 year Lease.

I sold the "Hawk": HP/Konica Minolta and Ikon's nexus of the absurd. HP's first toe-dip into the copier industry.

I sold Edgeline.  HP's second and "this time, we'll get it right" attempt to play in the copier industry.

I own a TouchPad.  I wanted to own one.  I was an HP head, as much as could be, without being employed by Mother Blue.

So when the TouchPad was rumored, I maneuvered into a position to get one.

When the rumors came down the channel that HP was going to market their E*Print along with the new tablet, as an MpS Practice manager, under the HP OPS banner, I was doubly excited.

I was not alone.

Across the country, honorable, trusting, HP believers, and employees,  fanned out to the channel exalting the next big thing in print; mobile print through HP tablets and phones.  WebOS was to be installed on every printer, MFP, laptop, phone, and tablet.

Ubiquity.

We were encouraged to invest and build mobility practices. Indeed, HP VARs all over, hired, shifted, and built business plans around the "Blues Clues' handy-dandy notebook" and print.

At the time, we saw Apple as pulling tablet use up for everyone - like the rising tide lifts all ships.

Of course, it ended up not being the tide, but a tidal wave, dashing the hopes and dreams of mobility practice managers everywhere into the rocks of BYOD.

Looking back like this feels as though I'm 'piling on' as Meg tries to right the lumbering behemoth - jettisoning tens of thousands and returning to HP's hardware roots.

HP will survive.  It's too big to fail.

What is to be learned from this Shakespearean tragedy?  What can we as individuals take from the meteoric arc?

1.  Everything dies, baby that's a fact...
2.  What is strong today, can be gone tomorrow
3.  Logic sometimes, doesn't prevail
4.  The obvious isn't
5.  When you forget who you are, you're just aching for a smack-down

Currently, HP, Canon, and Samsung have announced, each in their own way, that they are now, always have been, and always will be, hardware manufacturers.  Defining who you are and promoting yourself as true, is the only way to survive these days - we can debate over the sustainability of a pure hardware play, my money is on Samsung.

Period.

The truth is finally revealed.  No more talk of 'solution-based selling', or 'on-ramps to EDM', or such nonsense.  For these guys, the value is, 'best product', 'reliable performance', "affordable price', 'simple to use', printers and copiers.

For them, MpS will always hold a capital "P" and a small 'm'.  Oh, they will protest, flaunting symbolic MpS programs, designed by marketing departments and tasked with landing more equipment.

Period.

So it is with great nostalgia that I combed through this article from The Verge, regaling the rise and fall of Pre, WebOS, and TouchPad.

Oh, how the mighty have fallen - $1.6 billion write-off? - ain't nothing but a thang, just ignore that.