It's not easy being CEO. That's especially true if you run a massive company that doesn't quite know what to do with itself. HP's Leo Apotheker learned the hard way when he was ousted to make room for Meg Whitman barely a year into the job.
It's been a rough ride for HP (HPQ). The company's stock has tumbled as much as 47% since Apotheker took the reigns and effectively slashed and burned his way through the company, killing off a recently launched line of mobile devices, putting the WebOS operating system on ice and announcing the potential spin-off of the Personal Services Group. Meanwhile, a $10.3 billion decision to acquire British management software firm Autonomy raised plenty of eyebrows. Sources inside HP also told Fortune Apotheker suffered for not having former-CEO Mark V. Hurd's aptitude for numbers. It's no surprise his informal employee approval rating plummeted to just 25%.
Now the job is all Whitman's. During the company's conference call announcing her appointment, new executive chairman Ray Lane said, "Meg is a technology visionary with a proven track record of execution." Perhaps. Whitman, an HP board member and director, knows the road ahead is a tough one -- she admitted as much during her first interview as CEO with All Things D. "I am resolved to restore it to its rightful place," she said. Here are 5 moves she needs to make right away if she wants to have a chance of making that the case.
Sort out the PC business.
Last month, the company dropped a bombshell, announcing it might spin-off or sell its Personal Systems Group, which sells PC hardware. The division is one of HP's largest revenue sources, but also its least profitable. (It happens to be what most people know HP for as well.) Lane has said the company would not sell it off, insinuating that if a spin-off were to happen, HP might turn the group into a partially owned, independently operated company. Whitman seemed to be on both sides of the issue, expressing support for her predecessor's strategy but also saying she'd take a second look at the move. That left analysts totally confused.
A decision should be made sooner rather than later. If HP wants to refine its focus, make enterprise and software services its bread and butter like IBM (IBM), get it over with.
Make a plan (for Web OS). Any plan.