CRN Exclusive Q&A: HP CEO Meg Whitman On The Split's Impact On PartnerOne

Whitman On Partner Implications

Hewlett-Packard CEO Meg Whitman sounded off Monday on the economic impact a split of HP into two publicaly-traded, Fortune 50 companies -- Hewlett-Packard Enterprise business and HP Inc., each with $56 billion in sales -- will have on lucrative partner incentives and the HP PartnerOne program.

Here is an excerpt of CRN's discussion with Whitman.

What does this mean for the HP PartnerOne program?

For fiscal year 2015 (ending Oct. 31, 2015) everything remains the same because we are one company through Nov. 1 2015. So everything remains the same for fiscal 2015. Then as we head into fiscal 2016 there will be an arrangement between Hewlett-Packard Enterprise and HP Inc. to make sure partners don't lose the benefits for those who sell both. There will be an arrangement there, which we will define a little later on.

Will there be more or fewer incentives to sell the full, HP product portfolio?

I would say it will be about the same as it is today. As you know, we have actually made it more profitable to sell the full HP line over the last three years and we don't want to lose that benefit. We want partners to be part of the broader HP family. I can't tell you it will be increased, but we imagine it will be the same.

What is your message with regard to channel commitment as you undergo this transition to two, publicly-held companies?

We are 100 percent committed to the channel. We have pivoted this company hard. And [HP Printing and Personal Systems Executive Vice President and future HP Inc. CEO] Dion [Weisler] (pictured) is a huge supporter of the channel. The channel is 85 percent of Dion's business. He understands how important the channel is to that side of the house. I understand that we at Hewlett-Packard Enterprise have pivoted hard back to the channel and that will be unchanged.

How should partners respond to the FUD (fear, uncertainty and doubt) that is going to come from competitors as a result of the split?

Leadership continuity is really important here. I am going to be the CEO of Hewlett-Packard Enterprise, but I am also going to be the non-executive chairman of the board of HP Inc. So I remain involved in both companies. I think after we get these companies separated, this will be better for partners. It will make both sides of the house more nimble and more flexible to bring the kind of innovation that partners need over the next couple of years, which are going to be tumultuous times for the partner community. So I actually think this makes us a better partner -- more nimble, but not losing the relationships we have had over the last three years.

Talk about the strides HP has made over the last three years with partners, which are going to come into play here.

We have significantly improved the trust and confidence with our partners. They have seen all the work we have done to make it easier to do business with us. They have seen the innovation pipeline, not only on the PC and printer side, but also on the enterprise group side and even the software side.

Talk about how you are reaching out to partners.

We are making calls out today to our platinum, gold and silver partners to make sure they understand how this affects them. We have an enormous outreach going to partners of all size and scale as well as our distributors. In fact, I am making probably 50 phone calls today to our platinum partners.

HP Inc. retains the HP brand and logo. What will the Hewlett-Packard Enterprise brand look like going forward?

The reason we decided to put HP Inc. and the blue logo with the personal systems business is because such a large part of their business is consumer.

Hewlett Packard is very well known on the enterprise side. So this notion of Hewlett Packard Enterprise, an enterprise focused business, makes a lot of sense. We will develop a new logo for the Hewlett Packard Enterprise side.

We retain them both. So we have HP Inc. and then we have Hewlett-Packard Enterprise. So I think we actually did a nice job.

Talk about how this frees up Hewlett-Packard Enterprise to look at acquisitions of fast-growing, emerging technology.

We are setting up the balance sheets, the financial architecture of these two companies, to be best suited to their particular markets.

Hewlett-Packard Enterprise will have a balance sheet that will be tilted toward more inorganic moves, more M&A. On the HP Inc. side you will have a very strong balance sheet that can fund some M&A, but also a lot of organic innovation.

I think it would be fair to say that Hewlett-Packard Enterprise will be better able and more quickly able to make acquisitions that further the New Style of IT.

How does it feel to split the company so you can look at emerging technologies and go after some acquisitions?

We are really excited about it. I think this is the right thing to do at the right time in this turnaround. But we would not be here had we not executed against the turnaround in the last three years. The turnaround made today possible. So we are excited about it. Don't underestimate the HP Inc. side of this. In the next couple of months you are going to see some very exciting innovations being announced over there. I think we are setting up two great scale companies that are going to be leaders in their respective fields. We are psyched about it.