HP's new boss faces humbling task

PALO ALTO, Calif. — Hewlett-Packard Co.'s new chief executive, Mark Hurd, told a crowded room of reporters on Wednesday that he's approaching his new job with excitement and humility.

The emphasis may be on the latter when Hurd settles into the task of getting a Silicon Valley institution out of a funk that's the legacy of his predecessor, Carly Fiorina.

Analysts say the scope of the challenges facing HP — which is locked in fierce battles with rivals IBM Corp. and Dell Inc. — could humble even the most unpretentious executive.

Hurd, 48, resigned Tuesday as president and chief executive at Dayton, Ohio-based computer services company NCR Corp. to take the HP helm.

On Wednesday, Hurd acknowledged that his new employer was "not performing to its potential."

He refused to elaborate on his plans for the company, instead vowing to undertake thorough financial evaluations across HP's five divisions and dozens of product lines.

"I don't think you'll find me doing anything tricky," Hurd said at a news conference at company headquarters, flanked by board members Patricia Dunn and Bob Wayman, who also is chief financial officer and remains interim CEO until Hurd officially takes over Friday.

Wall Street has questioned whether shareholders would be better served if HP spun off its lucrative printer business into a standalone company, and Hurd refused to answer questions Wednesday about that possibility.

Investors have applauded Hurd's management style as a strong contrast to that of Fiorina, who was ousted less than two months ago. The company's stock shot up 10 percent Tuesday after he confirmed that he would be moving to HP.

On Wednesday, it gained another 22 cents and closed at $22 per share.

Despite that boost, HP stock hasn't exceeded its price at the time of the May 2002 acquisition of Compaq Computer Corp., and it has underperformed when compared to the stock of its rivals.

Hurd also inherits a company where morale is flagging after more than three years of layoffs. Employees wonder whether the vaunted "HP way" — a fraternal, clubby working culture once known for lifetime jobs, generous salaries and benefits, and a work ethic centered on consensus building — will survive.