Meg Whitman steers HP straight at the rocks

Combining troubled PC and printer businesses will weaken both groups and ensure HP's continued irrelevance

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HP needs a different kind of help as BYOD and consumerization grow
I'm not arguing that the two divisions don't need help. They do. In the last reported quarter, the PC group's revenue declined 15 percent year over year (shipments were off 16 percent globally, 26 percent in the United States), while printing group's revenue declined 7 percent.

But why glue them together? And why put Todd Bradley in charge? He's been running the PC business for six years, and during his tenure, HP has been out-innovated and outmarketed by Apple and others; its reputation for quality workmanship has declined and its messaging has been muddled.

To be fair, as Gartner analyst Mikako Kitagawa tells me, HP has been quite consistent in holding on to margins in the PC business, a real accomplishment. The company's share of the PC market has also been reasonably stable, averaging 18 percent since 2007, according to Garnter. HP credits Bradley with growing PC revenues by 30 percent since 2005, whereas printer revenues have fallen. Of course, PC sales have been falling in more recent years.

Some of the plunge in shipments last year could be attributed to HP's dithering on whether it would sell off the PC unit (gratis ex-CEO Léo Apotheker, the gift that keeps on giving), so it's not fair to blame Bradley for that one. But he's not the visionary needed by HP to compete in the era of BYOD and consumerization.

Unlike smartphones and tablets, PCs are still an enterprise buy. But as my InfoWorld colleague Galen Gruman points out, that's changing. The success of bring-your-own mobile devices is tempting corporate execs to consider the benefits of letting employees use and support their own PCs. I haven't seen numbers on this trend, but it's probably still fairly small.

However, it will happen. Selling fleets of beige PCs to volume buyers is very different than selling them to empower employees. There's nothing in Bradley's record to indicate that he can lead the division in a new -- and very difficult -- direction. Don't believe me? Check out HP's mobile strategy, which he led. Right -- there isn't one.

HP's PC business needs a creative and strategic remake, but its fundamentals, as measured by margins and market share, aren't bad. Combining it with another troubled business won't lead to more innovation and, in fact, may detract from its decent fundamentals. And how will that help the printer business, which has already angered customers by sneakily reducing the number of pages ink or toner cartridges will churn out? Sure, there will likely be some cost savings, but as the last three CEOs of HP have learned, cost savings are not the road to success.

This is a terrible move that will cost jobs in a company whose string of terrible CEOs has already resulted in tens of thousands of layoffs. My only comfort: As a Californian, I'm relieved that Whitman, a failed candidate for governor, isn't running my state.

I welcome your comments, tips, and suggestions. Post them here (Add a comment) so that all our readers can share them, or reach me at bill@billsnyder.biz. Follow me on Twitter at BSnyderSF.

This article, "Meg Whitman steers HP straight at the rocks," was originally published by InfoWorld.com. Read more of Bill Snyder's Tech's Bottom Line blog and follow the latest technology business developments at InfoWorld.com. For the latest business technology news, follow InfoWorld.com on Twitter.

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