Partners Mull Possibility of More Changes at HP

"They have some real challenges in the first six months of the year to get the printing unit and the PC unit merged and working with the channel in an effective manner," said John Marks, the CEO of JDM Infrastructure, a Rosemont, Ill.-based HP reseller. "That said, I have all the confidence that they will be able to work with the channel more efficiently and grow sales for themselves and their partners."

Marks applauded HP's decision to combine the printing and imaging group with the PC group. "That was a great move," he said. "I didn't need two separate organizations calling on me with the same account. It was unneeded redundancy. I am hoping these changes can make us more competitive on pricing and servicing customers so together we can knock out Dell."

An HP spokesman said there are no other "senior changes due in the near future" in the wake of the Jan. 14 announcement to combine the Imaging and Printing Group and the Personal Systems Group. But The Wall Street Journal reported Monday that HP directors are considering a management reorganization that would distribute some key responsibilities of HP Chairman and CEO Carly Fiorina among other executives.

The Journal also reported that the HP board has asked renowned venture capitalist Tom Perkins, a former HP director, to rejoin the board. Perkins, one of the cofounders of premier Silicon Valley VC firm Kleiner, Perkins Caufield and Byers, was out of the country and could not be reached for comment.

Marks, for his part, said Fiorina is a strong leader. "I think she has done a lot of great things for HP," he said. "The merger with Compaq went better than even the worst of naysayers thought it would go. I think they pulled off the merger as well as anybody could have expected."

As to whether HP currently has the right management and organizational structure, Marks said that is up to Fiorina and the HP board. "I am hoping that Carly and the board feel like they have it right," he said.

Responding to The Wall Street Journal report, an HP spokesman said that boards of directors in general "discuss a wide range of topics consistent with their fiduciary responsibilities, and any speculation about these discussions is just that -- pure speculation."

The spokesman also said HP's board did discuss structural changes at its recent meetings, but those were the ones already announced Jan. 14. "There are no other senior changes due in the near future," he said.

On Jan. 14, HP announced that the newly formed Imaging and Personal Systems Group (IPSG) is being led by Vyomesh Joshi, a 24-year veteran of HP, who has received wide acclaim for serving the last three years as executive vice president of the wildly successful HP Imaging and Printing Group. Duane Zitzner, former executive vice president of the Personal Systems Group, retired in the wake of the restructuring, according to HP.

Pete Busam, the vice president and COO of Decisive Business Systems, a Pennsauken, N.J.-based HP partner, said he was pleased with the company's decision to merge the imaging and printing group with the PC group.

"It is exciting to see VJ (Vyomesh Joshi) take on the new role," Busam said. "He has always been a good friend to the channel. It's a good move on HP's part to combine those two groups."

Busam added that recent changes in the PC market, including IBM's sale of its PC business to Lenovo, continue to make that space challenging for any vendor.

Busam also said that HP's services organization is "very disconnected" from the channel, and this is an area that needs improvement.

"They have made some great strides with services but that organization has the toughest road ahead," he said. "That is something they really need to work on. I am very happy with the warranty-maintenance provider relationship, but we'd like to see them engage us more to do some of the advanced services like Microsoft Exchange."

Marlene Brill, president of Digitask Consultants Inc., a New York-based HP solution provider, said the company's biggest challenge is having "one message for the channel" and then following through with it in the field.

"I don't think that has happened and I don't think they know how to do it," she said, noting that her HP business has been down progressively each year for the last three years. "I am not optimistic."