On her first visit to India, Carleton S. 'Carly' Fiorina spoke to BT's R. Sukumar and Ashutosh Sinha on the reinvention of Hewlett-Packard and her initiative to sell to the developing countries.

Q. Hewlett-Packard was always seen as a Silicon Valley pioneer where innovation ruled large. But for some time in the 1990s, the company looked like it was slowing down. What exactly do you plan to do to spur innovation at H-P?

A. I think the principal reason we are engaged in a significant reinvention effort at H-P is to reignite the inventive capability that was always the hallmark of H-P. There is no question that the inventive capability of this firm has always been strong. But in some ways it was becoming buried in some bad habits which were getting in the company's way in the 90s. Our reinvention efforts are focused on creating a strategy that positions us for leadership in the 21st century. It is a century in which technology will play a very different role than what it did in the 20th century-an era in which pure products will no longer be enough. Products are important, but they are not enough because this is now an era of networks and network systems.

We are engaged in restructuring our business and creating new processes which leverage our power more effectively. And we have focused more resources on (building the) inventive capability both at H-P Labs and our product generation organisations. So, it is a broad effort to ensure that H-P remains a leading company in the new era of technology, just as we were a leading company in the (past) six decades.

So, what are the new technologies that we can expect to see from H-P in the near future?

We have completely revamped our server lines in the last 24 months, our storage line in the last 12 months, and our printing and imaging line in the last 24 months, and we have introduced a whole new software stack as recently as eight weeks ago. You will continue to see us introduce new products and technologies. But I think it is accurate to say that in the last 24 months, we have introduced a whole suite of new products. In fact, we have introduced more products in the last two years than in the last four or five years put together.

There is this perception that ever since you have taken over at H-P, you have tried to make the company do too much too soon...

Well, I am not sure that there is that perception. Certainly, this has been repeated in the press, but that does not make it true. It just makes it reported. But I think this is a significant set of changes. They are significant because we are embarked on sustainable, systemic change. And sustainable and systemic change is required for a corporation to retain leadership.

The environment we compete in today is very different from the environment we competed in five or 10 years ago. And so, we as a company have to have both the capability and the courage to change ourselves to meet that new environment. The market is moving incredibly quickly. We face intense competition. We face demanding customers. I am fully confident that the people of H-P have the capability to make these changes. I am pleased to have progressed to date, although this is clearly a multi-year change programme.

So when will the results of this multi year change programme manifest themselves?

I think they are manifesting themselves now. You don't go from 5 per cent to 15 per cent without something going right. You don't introduce more new products in the last 24 months than in the previous five years without something going right. You don't see customers responding very positively to the changes we are making without making significant progress. Having said that, it is a multi-year programme and I think we are halfway through it. However, I would also say what I say to employees all the time, which is that a company that thinks that it is done, is done. Any company that says ''I don't have to do anything different'', ''I don't have to change. I can just stand in place''... What happens when companies decide to stand in their place is that they become bureaucracies and over time they become less and less relevant. And so while as I say we are about half way through the change programme, I hope that this is a company that is on a never ending journey of change.

You have done away with multiple organisations and put in place three product organisations and three sales organisations. How has this worked?

Well, what we had before I arrived at H-P was close to a hundred different organisations. They were all standalone businesses built around standalone products. This was extremely inefficient, because we replicated functions in every single of these businesses. We did not operate as one company. We operated as what I call a thousand tribes. It was very confusing for customers. In fact, the joke was, when we had a customer meet, lots of H-P people would pull up to meet the customer and introduce themselves to each other before they went in to see the customer. This is no way to satisfy customers' requirements.

We are restructuring our business to focus more effectively on providing a total customer experience; to really understand the customer requirements and really leverage the full power of H-P to satisfy those requirements. And we are getting a lot more focused in our product generation capability so that we are providing network solutions and systems, not just standalone products. The age of hot boxes is over.

Customers are demanding more than just speed. A consumer now says, ''Just because this pc is faster, does not mean we are going to spend money on it. What I want to know is how does a solution make my life more productive, more fun, more enjoyable, more convenient.'' Likewise, a business customer says, ''I am not going to keep spending money on technology just because somebody tells me that it is faster; I need to understand how it improves my return on investment, how it helps me achieve my business objectives.'' That's a conversation and a set of capabilities which is about much more than 'my hot box is hotter than your hot box'. It is a fundamental shift in how customers buy. And in a way, the economic downturn is accelerating that shift. Because what happens when you are uncertain, you get more discriminating about how you spend your money.

Now that you are midway through your change programme, what does the new H-P look like?

We will remain a very strong printing and imaging company, as well as a computing company. We will be a large professional services and software company. Fundamentally, we will be focusing our inventive capability on e-services, intelligent connected mobile devices, and always-on internet infrastructure. We have an absolutely unique portfolio, being in printing, imaging, and computing allows us to focus on applications where the physical and virtual worlds need to come together, which is, I think, the next big wave. I think we will be a company known for our solutions as much as we have historically been known for our products. But I think you'll continue to see us being both a very large consumer company and a very large business-to-business company.

H-P hasn't just been known for its products. It has also been known for its management style, the H-P Way. With the changes that are taking place, is there a new H-P way that is emerging?

The short answer to your question is yes and no. Yes in the sense that the H-P Way had come to be shorthand for anything that people wanted to do. And that frequently happens with shorthand; people tend to abuse it over time. So the H-P Way came to be known not simply for the core values and the management practices we believed in, but also came to be known for things that weren't so good, bad habits that got in our way: slowness, consensus... So, what we've done is go back to a very explicit level.

What was the H-P Way really all about? First, the H-P Way was about two things. Our core values, respect, integrity, teamwork and collaboration, con- tribution to customers and community and what we call our rules of the garage. And the rules of the garage are an attempt to capture and distil the essence of what made that garage special. I think what we are doing is reigniting the H-P Way, rediscovering the essence of the H-P Way, and scraping away all the sediment and habits that had been heaped on to this phrase that didn't really have anything to do with what it originally meant.

Where does India fit in?

I think India plays an extremely important role for really three reasons. One, because it is an important market in itself. An important and growing market in which we are going to learn some important things. Two, it is important because of the quality of talent you find here and, therefore, the power of ideas that get generated here. Three, I think that the most important ideas, new ideas, new inventions about how technology can be applied in a transformational way are going to happen in places like India. I think the next big wave of technology, invention, and innovation is going to have to tackle things like sustainability, things like how technology can be applied in an economic way to underprivileged communities. I think this is an important environment for innovation.

How has H-P fared in areas like services and consultancy that are extremely important today?

Well, I should say first that we are a $8 billion plus professional services company today. Our services business grew last year at 60 plus per cent. We have been hiring aggressively in our services business.

You will see us announcing some very focused partnerships around key applications. I would not rule out acquisitions ever, but I am not going to make those acquisitions unless they represent the right value at the right price. So, we remain very committed to our strategy to build our consulting and outsourcing professional services.

We can see the social aspect of your inclusion initiative that will focus on using technology to help the economically underprivileged improve their lot. But how can any company reap the benefits of this?

To think about the business benefits, you have to accept a couple of things that I think are easy to accept because they are supported by facts. One thing you have to accept is that growth in the developing world is outstripping growth in the developed world. That is a fact. Internet usage is growing faster in the developing world than the developed world; infotech spending is growing at a faster rate in the developing world than in the developed world. I think this is clearly an important market and the only way you go after an important market is to get engaged in that market. I think the second thing that you have to believe and that is less supported by data, but is absolutely supported by my experience, is that frequently the most important breakthroughs and the most important innovations occur under stress. And by stress I mean limited resources and limited budget.

As an example, we have accomplished some things with our team in India that we could not accomplish sitting in California because sometimes the truth is, the more resources people have, the less inventive they become. So, I think it is important for CEOs to worry about where the markets will be five to 10 years from now, because it takes long-term investments to go after those markets. I also think it is important for CEOs to think about where the best ideas are going to come from. I don't believe that every breakthrough is going to come out of Silicon Valley. I think there are some important breakthroughs that come out of places like India. That I think is the business part of it.

Obviously, there is a philanthropic part of it as well. But it is not simply about charity. Interestingly, the communities that we are working with don't see it as charity and don't want charity. They are really interested in creating sustainable solutions. They are not working for 'hand me downs'. They are working for the application of technology that serves their aspirations and their requirements.
  

Issue Contents  Write to us   Subscription   Syndication 

INDIA TODAY |  INDIA TODAY PLUS | COMPUTERS TODAY  |  TEENS TODAY  
THE NEWSPAPER TODAY | MUSIC TODAY | ART TODAY | CARE TODAY

© Living Media India Ltd