worked at HP at the time. It was one of the most important companies in the world—comparable to what Microsoft or Google are today. A true tech and market leader.
First, HP bought Compaq to gain full ownership of the home computer market. That merger didn’t work out very well. Later, HP acquired Ross Perot’s EDS, attempting to enter the services business. The integration was, at best, chaotic and took several years.
It was a time of turmoil—every other morning you’d receive an email from Mark Hurd announcing layoffs affecting a percentage of employees.
Hurd’s focus was on increasing the company’s share value. He aggressively cut staff and reduced R&D investment (one of HP’s strongest traditions), essentially putting HP on life support. For example, HP-UX, which was relevant in the server market at the time, was completely abandoned.
When Mark Hurd was fired—accused of using company funds to give gifts to occasional partners (you know what I mean)—he immediately joined Oracle as an advisor, one of HP’s strongest competitors in the enterprise market at the time. Employees saw him as a traitor to the HP brand. Internally, many people hoped things would finally change.
What came next was completely unexpected. Leo Apotheker, from SAP, took over. He had this idea of transforming HP into a software and services company, essentially abandoning decades of tradition and letting one of the strongest brands in the industry fade away. He lasted only a few months—it clearly wasn’t working.
Then Meg Whitman came in. There was some initial hype around a hardware project called “The Machine,” which was supposed to revolutionize the data center by relying on memory instead of CPU power. That was never released. AWS had already emerged, and HP had no way to compete.
Whitman decided to split the company in two: HP (consumer hardware) and HP Enterprise Services (enterprise hardware and services). HP-ES eventually migrated most of its operations to India. Around that time, I accepted a WFR (Workforce Reduction) plan—since it was clear I’d be laid off sooner or later. Later, HP-ES was split again and became DXC Technology for services.
It’s incredible how a company that was once one of the strongest brands in the world—a tech giant and market leader for decades—went to hell in just three or four years. Bad management, a focus on short-term share price, and a complete lack of vision can bring even the most powerful company to its knees.
At the time, many said HP was simply too big for its own good, that it was impossible to succeed in so many markets. I don’t think that’s true. Amazon, Microsoft, Google—they all do what HP did in the 90s and 2000s, and more. It was just bad management. As always.
