Hurding HP

The Associated Press notes that HP has selected NCR CEO Mark Hurd to succeed Carly Fiorina as the head of HP. The source of that information, the Wall Street Journal notes:

Mr. Hurd isn't a stranger to effecting turnarounds. Mr. Hurd, who joined NCR in 1980, has pulled that once-troubled company out of the red, partly by slashing costs. In January, NCR, which makes automated teller machines and other retail and financial-electronic products, reported that its fourth quarter net income had surged 55% and raised its 2005 earnings forecast for the second time in nine days.

So let's get this straight. The board got rid of Carly Fiorina because she was too hard-nosed and wasn't enough in tune with "The HP Way" pioneered by Bill Hewlett and Dave Packard. So to replace her, they hire someone whose description bears a striking resemblance to that of Chainsaw Al, the CEO who destroyed Sunbeam?

In all fairness, we shouldn't prejudge Mr. Hurd's performance. We admired his work at Teradata and expect he will work hard for HP. But this is a great example of corporate actions not being aligned with the messages that HP's board has been delivering. For years, we heard that Fiorina's problem was that she was too aggressive about the business results and not in tune with the more engineering and consensus-based culture at HP. Hiring an even tougher cost-cutting turnaround executive makes those messages ring untrue for anyone who has been paying attention to HP's story. We believe that this messaging disconnect will negatively affect both the stock price and the HP brand for some time to come.