Hurd And Seen: Talking HP With CEO Mark Hurd3:16 PM EST Wed. Mar. 31, 2010
Hewlett-Packard CEO Mark Hurd has led HP to its third consecutive finish as the world's largest technology company in terms of annual revenues. Suffice to say, people want to hear his opinion on a broad number of topics. But Hurd has plied his trade less as a celebrity CEO willing to make big predictions or snipe at competitors, and more as a hard-nosed operational manager driving sales, discipline and execution with employees and channel partners.
ChannelWeb.com Associate Editor Damon Poeter and Everything Channel Editorial Director Kelley Damore recently had an opportunity to try to draw Hurd out on subjects ranging from his economic outlook to HP's growing rivalry with Cisco for data center dominance to his business philosophy. Here are some key excerpts from our exclusive interview with Mark Hurd, with much more to come.
HURD ON HP'S MACROECONOMIC OUTLOOK FOR 2010:
"I think the economy is better than it was in 2009. We went into 2010 thinking it would be a better year than 2009. That might not sound like the boldest statement to make. I'm not sure that what you see today isn't what you're going to see more of for the rest of 2010. I think the hope that the second half of 2010 is materially better than the beginning of 2010 [is unfounded]. It's hard to find indicators that say that.
"And I think while as much as you may want to hear on TV, positive people making statements like that, the numbers tend to say we've had some improvement, but we what we have is more of what we've got."
HURD ON HP'S GROWING RIVALRY WITH CISCO IN THE DATA CENTER:
"We just see the networking opportunity in isolation as a big one for our customers. You know our history with ProCurve. We've had a very successful run with ProCurve. We've gained a material amount of share, both in ports and in revenue. We have announced our intent to acquire 3Com, which we think is a set of capabilities, end-to-end, that we think is going to be very impressive.
"It's a market with good growth in it -- very high gross margins, which is the history of the prices that the current incumbents in the market charge. And we'll be very active in the market, so we're pretty excited about it."
HURD ON CONCERNS ABOUT EXCLUSIVITY AND VENDOR LOCK-IN:
"Listen, it's always easier when you have a relationship that's quote-unquote exclusive. But I don't think our view is that the world has to be exclusive. We're very comfortable in a co-opetive environment and have been for a very long time. I think that's one of the assets of dealing with HP.
"You know, we're used to partnering in all kinds of different environments to the optimal conclusion for a customer. Because at the end of the day, we've got to do things that help customers do things."
HURD ON SELLING TOTAL HP SOLUTIONS THROUGH THE CHANNEL:
"We've had good growth in the channel every year for the past four or five years. We don't expect that to change. And I think you should expect us to continue to try to convince the channel that there's a lot of advantages to being able to leverage all of our capabilities as opposed to just one.
"So we think we've got a pretty compelling proposition for our partners. And make no mistake about it, we're probably not just channel-friendly, I think we're channel zealots."
HURD ON WHAT HP NEEDS TO COMPLETE ITS DATA CENTER PRODUCT PORTFOLIO:
"The answer is, almost undoubtedly there will always be something we can do [in terms of acquisitions]. And I won't predict for you whether there will be another set of investments along those lines. But we'll continue to invest, particularly in R&D. ... We feel good about our current position. We feel good about the pipeline of innovation coming from the company.
"In early 2010 is when [we have] the strongest pipelines of new product introductions you've seen come out of HP in a long time. We expect that momentum to continue and I'll never, never predict M&A. It is what it is.
HURD ON HOW HP AND ITS CHANNEL BEST SERVE EACH OTHER:
"I think looking at markets either vertically or as solution sets is probably the most advantageous thing. And I think you have a large part of the reseller community that does that, and we want to play into that. We want to combine our strengths with their strengths to effect an extremely positive business outcome for their customer, for that end-user customer. And I think that end-user customer needs a lot of help.
"They need all the advantages of a big company. They need all the solutions of a big company. And they lean on our partners and us to do that for them."
HURD ON HOW HP'S GROWING SERVICES BUSINESS AFFECTS CHANNEL PARTNERS:
"The fact is that our channel partner could say [to an SMB customer], 'Hey! In addition to this one data center you have, would you like the opportunity to back it up? Well, I know how to get access to capacity, and it's HP's capacity. And I will sell that to you and I will help solution that to you.' That's an opportunity for the customer, and for our channel partner, and for HP.
"And that's what I mean by saying, don't run with the fact that if HP gets big in services that means that's to the exclusion of the channel partner. That's why I say to you, we think about partnering at every turn. And we know we don't have a lock on all the great ideas. And we certainly know that we don't have the opportunity to get to all the buying points in the market."
HURD ON SEPERATING CLOUD HYPE FROM CLOUD REALITY:
"As it relates to opportunities using the cloud, I think it's more important that we break those down into specific services. Where instead of saying, 'Hey, how would you like to participate in the cloud,' you say, 'How would like me to help you back up your data center? How would you like me to help back up your server farm?'
"Or, 'How would you like to have some peak minutes available so when you have spikes in your workload, you know where to send those spikes without having to buy all that capacity? How would you like to have a private cloud built for you, with architects, etc. etc.?'"
HURD ON THE UNECESSARY COMPLEXITY OF IT SOLUTIONS:
"I'm a big believer that simple is good. I think simple is good in many dimensions. You know, leadership is not about making things complicated. Great things get done when you can break things into small pieces that are understandable and actionable. And I think the same thing's true in technology.
"When you go in and tell somebody, 'I have this great solution for you, but it's so complicated that nobody can understand it and/or imagine getting it implemented,' I'm not sure if that's a good thing. So I actually believe simplicity of solutions, simplicity of service, simplicity of technology is a big asset."
HURD ON THRILLING YOUR CUSTOMERS:
"Listen, in the end ... the most important thing we all have is the ability to reference our work. We can do something badly or something well, and when we do it well, the chances are we'll get to go back to the customer that we did it well for and get to do something else for them.
"And when we're in another opportunity, the best selling that can get done is to have your prospect call your customer and say, 'How did it work out for you?' And the customer can say, 'You know, they took my problem, they made it simple, they delivered against it, and they thrilled me.'"
HURD ON HP'S EVOLUTION AS A CHANNEL COMPANY:
"[It] means us being more disciplined, not just the partner. And historically, we've shown up with a bag of goods and a set of capabilities and said, you know, 'Good luck to you.' And we just want to make sure that we say, 'Listen, if there's a vertical market, a geographic market, a solution set that you're expert on, then we can team together to go get incremental market opportunity.'
"And we want to incent that kind of behavior. So my view of the channel is very positive, and has done nothing but get more positive, and to be very blunt, the channel's delivered for us."
HURD ON THE DOUBLE-EDGED SWORD OF BEING A GIANT COMPANY:
"We bring a great portfolio of products because of our scale -- you know, scale is a strange friend. Right? I mean, it can be the great scale of the huge HP portfolio with the tremendous capabilities of HP, tremendous support from the very large-scale sales force with the tremendous brand.
"Or it can be, hey, it's that big HP with a lot of people in it, you have to talk to a lot of folks to get things done. That kind of thing. And so the very same fact can be an asset or a liability. Our objective is to make it an asset."
HURD ON HIS MESSAGE FOR HP'S UPCOMING CHANNEL PARTNER CONFERENCE:
"Listen, in the partner conference, I'm going to be pushing partners to go get more market opportunity. The U.S. is a market we're putting more resources into. We're putting more salespeople into the U.S. And our sales force knows that whether we take a deal direct or take it through a partner, we're economically neutral.
"Because we're economically neutral to it, our adding more salespeople is not a threat to the channel. It's an asset to the channel. It creates more demand. Our objective is to create more demand for this brand."
HURD ON WHAT KEEPS HIM UP AT NIGHT:
"I think today, to be honest with you, we're still not as good as we could be in many dimensions. We can be better. And I think almost everybody in the company can give you examples of where we don't do things as well as we should. And you think about how good we are in many dimensions with those issues, you just think about what we could be if we got those right and it's just exciting.
"That's what keeps me up, it's getting that right. And it's just a huge opportunity. And that keeps me up. Because I don't think you'd ever want to drive out of the parking lot the last time, whenever that is, and say, you know, 'I just wish I'd gotten this, this, this, this and this.'"
"You know, when I drove out of the parking lot of my last company, the only other company I've worked for in my career, I was sad. I was sad. I didn't want to leave. But the one thing I can tell you without any doubt is, I left everything I had on the field. And I did everything I could to get that company in the absolute best position I could to win. And that's how I feel."