2000 ARC: Where's HP?

Hewlett-Packard is often jokingly described as a company whose main business is internal reorganizations. That trait, in fact, may have contributed to HP's poor showing in VARBusiness' Annual Report Card rankings, published in the Oct. 16 issue.

HP, based here, plunged from first to fourth in the client category, slipped from first to second in entry-level servers, and bounced from first to second in systems management software.

Those results came in spite of the rollout of a number of channel and solution- partnering efforts during the past 18 months, including Covision, Commerce for the Millennium and Channel 2000. The arrival of Carly Fiorina as CEO, a re-emphasis of the company around the e-services strategy and a shake-up of the Unix sales organization also led to personnel changes within the channel programs.

Those factors may account for average or below- average scores for the majority of criteria falling under the support and partnership headings in the ARC. That contrasts with one below-average score under the products/pricing heading.

HP observers say the internal changes have had an impact on how the vendor's solution-provider partners perceive it,though perhaps not in the way one might think.

"When you try to reinvent yourself like this, it's a zero-sum game to many people: 'If you're focusing on e-services, you must not then be doing something else that I need,'" says Clay Ryder, vice president and chief analyst for Redwood City, Calif.-based Zona Research. "Even if the change is for the better, some people will be scared if things are new and different."

The good news for HP is that, despite an eventful year and a failure to defend three ARC awards, it did improve in two categories,going from third to second in midrange servers and from fourth to second in networking infrastructure.

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