Did HP board have hidden agenda in removing Hurd?

HP CEO Mark Hurd was forced to resign, but the reasons given seem flimsy and seem to betray ulterior motives by the HP board.

By now everyone knows that HP CEO Mark Hurd was forced to resign following an investigation into an alleged sexual harassment scandal. Still, it seems that HP may have cut off its nose to spite its face so to speak, and the details behind forcing Hurd out raise questions about whether the board was just looking for an excuse to cut him loose.

At face value, it seems that Hurd was successful in piloting the HP ship. Under Hurd's leadership, HP has cut costs, and diversified revenue sources--creating a lean, mean tech giant capable of competing on multiple fronts.

During the Hurd tenure at the helm, HP rose to the number one spot for PC manufacturing, and number two for laptops. It acquired a variety of companies--including EDS, 3Com, and Palm--to expand its sphere of influence to computer consulting and services, networking infrastructure, and mobile platforms like smartphones and tablets, while reducing reliance on hardware sales.

Why then was the board so determined to push Hurd out? A sexual harassment scandal linked to the CEO could be a public relations nightmare, but by its own admission "The investigation determined there was no violation of HP's sexual harassment policy."

However, the investigation did uncover that there were violations of the HP Standards of Business Conduct. Specifically, the investigation found evidence that Hurd had filed inaccurate expense reports intended to hide his personal relationship with Jodie Fisher--the one-time actress turned contractor at the center of the sexual harassment allegations.

The amount of misappropriated expenses seems astronomical to the average employee, but put in perspective relative to Hurd's income from HP, the inaccurate expense reports are roughly equivalent to an HP consultant expensing an extra meal during a business trip.

I am not suggesting that it is acceptable, or that the board should condone such behavior, but it hardly seems like justifiable cause for removing the CEO if the largest tech company in the world. Perhaps the board has a hidden agenda.

It is possible that Mark Hurd had outlived his usefulness and the board was simply looking for a reasonable excuse to dump him. The aggressive cost cutting and management style of Hurd served a much-needed purpose to get HP back on track, but maybe it was time for fresh blood to lead HP into the future.

Regardless of the motives, we can only hope that the HP board knows what it's doing and didn't just shoot HP in the foot. Only time will tell if Hurd's replacement will be a positive or negative influence on the future of HP.

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Tony Bradley

PC World (US online)
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