The impact of Mark Hurd

I will leave it to others to comment on the overall impact that Mark Hurd has had on HP since he became CEO, and the only general remark I will make about his departure is that a drop in the share price of something approaching 10% seems pretty much overdone. What I will discuss is whether this has any impact on NeoView, the company’s data warehousing offering.

There are two things we can say about NeoView. The first is that it has very much been Mark Hurd’s baby. As the former head of Teradata he saw an opportunity to out-compete that company in the high end data warehousing market. It is generally felt that NeoView could not be allowed to fail, because of its close association with Mark Hurd.

The second thing we can say is that NeoView has not been as successful as HP would have liked. This is probably an understatement: when I talk to other vendors HP is never considered to be a serious competitor and it is rarely mentioned by end users either. My guess is that the NeoView group is loss making and, moreover, that these are significant losses: if it was a start-up it could be having difficulty in raising further funding.

The question is whether the new CEO will see NeoView as something that he or she will want to continue to invest in? Will it be viewed as strategic and, if not, can profitability be seen in the future? There has to be a significant possibility that the answers to all of these questions is no. If that is the case, and lacking the emotional and reputational association with NeoView that Mark Hurd has had, then there must be a serious risk that the product will be canned. Of course, this won’t happen soon: a new CEO has to be appointed and even then there will be other priorities – NeoView is a pretty small part of HP – but he or she will get around to it sooner or later.