HP and Compaq: aiming for the stars

By Graham Hayday, 20 July 1999 00:01

COMMENT Two women took on high-profile positions of responsibility this week. The first space shuttle to be commanded by a woman was due to take off early this morning, while on Monday, Carly Fiorina was announced as Lew Platt's successor as CEO of Hewlett-Packard (see http://www.silicon.com/a31593 ). While the latter job is hardly a matter of life or death, Fiorino does face a stiff challenge - but one that is nowhere near as frightening as that facing her counterpart at Compaq, whoever that turns out to be. Once the industry has got over the shock of seeing a woman head up a high-tech heavyweight (even though the real shock is that it's taken this long), comparisons between HP and Compaq are inevitable. Both were slow to react to dramatic changes in the industry. As a result, both are now trying to rebrand themselves as fleet-footed Internet companies. Both are getting to grips with ecommerce (and worrying resellers in the process). As a result of that, there have been significant internal reorganisations at both firms. While HP and Compaq may have started out from similar positions, the current trajectory of their turn-around missions could hardly be more different. Lew Platt - an HP stalwart of 33 years - announced his intention to retire in March, but will not step down until the end of the year. Eckhard Pfeiffer walked out on Compaq (or was pushed, depending on which rumours you believe) just a few days after he made a keynote speech claiming how great the company was at its annual love-in last April. Compaq has been looking for a replacement ever since - and no front runners have emerged. The news of Fiorina's appointment was not leaked before it became official. HP's Web site carried her complete biography as soon as the announcement was made. If you trawl through the official Compaq releases of late, all you get is mention of a new 'acting COO' to oversee the company's attempt to "improve [the company's] focus on meeting our customers' requirements", as the release blandly reads. And let's not forget that there are a few words about the several other senior execs who have left the company since Pfeiffer's departure. HP's latest marketing campaign focuses on rebranding it as an 'e-services' company, a campaign which seems to have worked. Its share price has been on the up for weeks, and now stands at a record high. Compaq's recent advertising push focused on its heritage in cash machine technology. There is a tenuous link to the corporate world there somewhere, but more significant is that those of us with a memory can recall that a lot of Tandem's marketing focused on its heritage in, erm, cash machine technology. This isn't stuff that Compaq developed itself. In fact, one of Compaq's major troubles is its inability to grapple with the Digital and Tandem acquisitions, a process which needs a strong CEO to work properly. Now, while these sorts of high-level shenanigans and marketing battles have little direct impact on the procurement processes of European businesses, it is nevertheless true that one company is sending out reassuring messages, and one seems... well, lost in space. Let's hope the same fate won't befall the shuttle. In the meantime, HP's fortunes (and its share price) are going into orbit. Compaq hasn't even begun the countdown yet.

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