Léo Apotheker’s appointment may have scooped the headlines but analysts agree that the new leadership at HP will be a two man team.
Apotheker has been confirmed as starting in his new job on 1 November, but Ray Lane’s appointment as non-executive chairman is going to be crucial to ensuring that Apotheker's tenure outlasts the seven months he spent as chief executive of SAP. Apotheker acknowledged Lane’s industry insight in a call to analysts today.
“By himself Leo wouldn’t work,” Rob Enderle, principal analyst at the Enderle Group, told V3.co.uk.
“To work they have to be part of a team and they’ll be the key work leaders at HP.”
He explained that while Apotheker may have the management experience and drive that the HP board want, Lane will also be crucial in bringing decades of experience in the US technology market to help the new chief executive adjust.
“They split the chief executive and chairman role, which makes a lot of sense with a new man at the head of the company,” Frank Gillett, principal analyst at Forrester told V3.co.uk.
“Leo’s experience is all about enterprise and he has a lot of vigour to bring to the market. The chairman is someone who understands Silicon Valley culture very well indeed and that will be tremendously useful.
Gillett pointed out that Apotheker’s 20 years of experience has been in the enterprise software sphere, which only accounts for a tiny proportion of HP’s revenues compared to companies like IBM. Lane would therefore be a useful guide and levelling force.
The new management team could, however, be a sign that HP sees its modest share of the enterprise software market as a weakness. The company has recently signed up with Microsoft to produce dedicated server hardware but Apotheker’s appointment could give HP an excuse to build up its software arm.
But the appointments could be seen as a sign that HP is going to go to war with Oracle, Enderle suggested.
Lane is a former Oracle president who was forced out by Larry Ellison in 2000 and was popular with Oracle customers, he said, and would be just the person to tempt them to defect. In addition, if HP were to try to buy SAP to bolster its software side it could go head to head with Oracle.
“Leo’s an interesting choice, particularly if you want to acquire SAP,” he said.
“SAP held Oracle up – one of the very few companies that could hold Oracle off and survive. Oracle customers don’t trust Larry at all, and do business in spite of him not because of him."
HP could fund the purchase by selling off its printing and imaging division, which would be more valuable as a separate company as it could then produce hardware for a wider variety of manufacturers, he suggested. However, Gillett disagreed, pointing out that IBM was a more logical choice to buy SAP.
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