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New Chapter For A Silicon Valley Crown Jewel: Hewlett-Packard Becomes HP Inc. And Hewlett Packard Enterprise

Hewlett-Packard employees and partners are looking forward to a new era of innovation as the once $110 billion company splits in two and becomes Hewlett Packard Enterprise and HP Inc.

Seventy-six years after Bill Hewlett and Dave Packard founded Hewlett-Packard in a Palo Alto garage, the company is set to embark on a grand experiment to take the culture of innovation and invention that the two entrepreneurs prized to even greater heights as two separate companies.

The Hewlett and Packard legacy is one that HP employees and partners are taking to heart as the once $110 billion company becomes Hewlett Packard Enterprise, a $53 billion company with 252,000 employees focused on the enterprise computing market, and HP Inc., a $55 billion company with more than 50,000 employees focused on the printing and personal computer market.

Christoph Schell, who started at HP as a 21-year-old college intern in 1995 and now heads up the HP Inc. business in the Americas, said he hopes Bill and Dave, as they are known to HPers, would have been proud of the innovation offensive taking place as a result of the split into two companies.

[Related: Hewlett Packard Enterprise CEO Whitman To Ring The NYSE Bell, Ingram Micro CEO To Join Her]

"It's a very emotional moment," said Schell, who recently moved into his new office in HP Inc. headquarters just a short walk from Hewlett and Packard's original offices, which are preserved as if they still worked at HP. "I think the future is really bright with the innovation that we have. I really hope they would be proud and they would see a lot of continuity in how they managed the business."

Schell said the management principles that Hewlett and Packard created and nurtured are still flourishing at the two companies, including the long-standing rule that HP employees can "escalate to anyone and talk to anyone to get stuff done. That has never gone away. I remember that from my internship days. It is still here, and we have underlined it."

Schell also points to a founding management principle of working in smaller teams to drive innovation. HP Inc., in fact, has established a separate unit to drive the 3-D printing business.

Hewlett Packard Enterprise CEO and HP Inc. Chairman Meg Whitman is celebrating the official launch of Hewlett Packard Enterprise by ringing the opening bell at the New York Stock Exchange with the HPE ticker symbol front and center (HP Inc. will trade under HP's current ticker symbol, HPQ). Joining Whitman at the NYSE will be partners and customers, including Ingram Micro CEO Alain Monie.

HP Inc., meanwhile, is celebrating the formal launch with an all-hands meeting with employees, customers and 70 partners from around the globe at its Palo Alto, Calif., headquarters.

Thomas Jensen, vice president of worldwide channel sales and strategy for HP Inc., said including partners in employee meetings is part of "re-emphasizing the meaning of the channel in the new HP with much more focus, engagement and cooperation with the channel."

HP Inc. views channel partners as an independent extension of the company. "That is the signal that we want to send by having them at our employee meeting and giving them first-hand access to what happens on the very first day that we operate as a new company," said Jensen. "We do not want to treat them as someone that we just involve when we need them or someone that we are negotiating prices with. We truly see them as an independent extension of HP Inc., and we need them more than ever to create success for our joint customers."


Dan Molina, CTO of Nth Generation Computing, one of Hewlett Packard Enterprise's top partners and No. 300 on the 2015 CRN Solution Provider 500 list, sees the split making Hewlett Packard Enterprise and HP Inc. living examples of what customers themselves need to do to be more successful in a market where the IT landscape is changing at a blistering pace.

"We are trying to help our customers become more agile," he said. "I think HP is showing a lot of leadership by splitting up. There will still be a lot of synergies between the two companies. They will still leverage economies of scale."

Molina, a 26-year industry veteran, said he thinks HP's founders would welcome the splitting of the company. "I think they would have been proud of a major change like this as enabling more innovation," he said. "That is how they started the company, with innovative technology. That helped the country and society be more useful, more productive. By splitting the companies it is going to allow both companies to be better."

Molina cites the 3-D printing opportunity being pursued by HP Inc. as a classic example of the innovation that would have made Hewlett and Packard proud. "That business alone could be a $1 trillion opportunity down the road," he said.

Ultimately, the split is going to power sales growth for the two new companies and their partners, said Molina. Nth Generation has grown steadily at a double-digit pace with HP, and Molina expects that to continue with the split.

"With hardware infrastructure margins eroding as it becomes a commodity, we are architecting new solutions that truly help those customers achieve their business objectives, namely lowering their risk, cost and allowing them to become more efficient and agile," he said. "We are providing business outcomes with new services that have rich margin along with hybrid infrastructure. We see growth ahead."

It is no small matter that the garage that is the birthplace of the entrepreneurial technology culture that has thrived in Silicon Valley will be available to both companies.

Schell, for his part, said the innovation culture that Hewlett and Packard prized is alive and well. "The No. 1 point is that we have that innovation," he said. "Both companies going forward will have HP Labs. We want to have that innovation. We have dedicated teams around innovation, and a CTO. Innovation is not just a PowerPoint slide to us. We really mean it."

PUBLISHED NOV. 2, 2015

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