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HP's leader puts company's soul on notice

LeoApotheker An interview at BusinessWeek quotes HP's CEO as saying the company "has lost its soul." HP 3000 advocates and experts may not count that epiphany as news. MPE/iX, after all, became viewed as a liability to Hewlett-Packard instead of an OS asset. The company started to think that the iron was what held customers in thrall, instead of what the iron carried.

Leo Apotheker impressed so few people on his debut at HP that the stock actually dropped on the news. That's the first time that ever happened, but look how the other CEOs turned out after being lauded by shareholders during their premeires. Carly Fiorina drove a wedge so deep into HP that the founder's son battled her and lost. Mark Hurd remains in the news today, more than a half-year beyond his ouster, because his search for integrity still appears like it came up short in the company of a pretty woman.

Apotheker didn't spin anybody's pinwheels when he blew into the CEO's office. But when a leader talks up software and equates it to HP's soul of innovation, it could herald a sparkly day for customer futures. That's especially true for the customers still building upon HP software, rather than Windows, to replace 3000s.

It's no surprise that Apotheker would predict a big renaissance for HP's invention via software. He came to HP from SAP, but said Hewlett-Packard has no interest in aquiring that kind of software company. He wants HP to buy technology bones, yes -- but also break with tradition by pushing its newest software platform, webOS.

Talk about the soul of a 72-year-old company is daring and provocative, but Apotheker is backing up his sermon with walks in HP's fields. He's been visiting the company's operations around the world including Boblingen, Germany -- a place where the HP 3000 and MPE advantage once burned brightest. Boblingen hosted the biggest party to celebrate the 3000's 25th anniversary. In 1997, HP still had enough soul to light a disco night.

Today there's his talk and determination to put webOS on the millions of PCs HP pushes into business and homes. Apotheker believes in ecosystems built upon the least tangible of goods, software. The HP 3000 customers still using the system might wish this religion had arrived sooner in HP leadership. And there's no guarantee that webOS success will mean anything better for HP-UX, VMS or NonStop environments. However, it can't hurt when a new CEO gives a green light to R&D that was stalled under Hurd's hand. With Android and Apple's iOS breaking ground around the world, it's a good time to introduce software innovation that is aimed at ecosystem building.

HP might have gotten confused from its printer prowess. Over in Imaging & Printing, counting units sold remains very important. But the element that once delivered half of HP's profits was not these devices. The ink the printers carried could be counted on to carry the day in quarterly profit reports.

Being "smarter than the room" is a saying in comedy that means you can't bring along your audience. Apotheker's intellect hasn't been questioned during the quarter he's logged at HP. But his history at SAP suggests he's familiar with pushing a contrary agenda. He's clashed with executives, something that might be a part of reclaiming HP's soul. From BusinessWeek:

"Being most of the time the smartest person in the room, Leo could get visibly frustrated with the other people not getting it," said Pascal Brosset, SAP's former chief strategy officer and now senior vice president of innovation at Schneider Electric SA.

"I'm not perfect," Apotheker said. "Temper comes with temperament; it comes with passion." He said he realized at SAP that a CEO can't sway "cynics" to his agenda by arguing.
"The one thing I've learned is to try to manage my temper better and get rid of cynics sooner," he said. Some of Apotheker's biggest skeptics these days may be investors.

For anyone relying on HP's enterprises, it's become time for HP to consider its customers to be its most essential investors, instead of its shareholders. The stock hasn't recovered the 10 percent drop off the Hurd firing; fair-weather fund managers have stayed away. Perhaps better that they do, even if it impacts some of HP's ability to make grandstand plays like buying 3Com. If Apotheker makes a habit of listening to customers instead of wooing analysts, the people who stick with HP might find a richer soul in their alternative software environments.