HP CEO Mark Hurd is resigning following a sexual harassment claim. How has HP changed since he arrived five years ago, in the wake of a different scandal?
HP chief Mark Hurd is resigning following a sexual harassment claim. Effective immediately, Hurd is vacating his role as HP chairman, CEO and president.
Hurd joined HP as CEO and president in early 2005, in the wake of a different scandal. His top priority then was to stabilize HP after taking over the CEO reins from Carly Fiorina, who architected HP’s 2002 acquisition of Compaq.
A little more than a year later, Hurd added the title of chairman after Patricia Dunn stepped down. Dunn had ordered an investigation into leaks of company information to the media, and HP admitted investigators had used "pretexting" to obtain the telephone records of nine reporters as part of its internal probe
During Hurd’s time with HP, the company has more than stabilized. Between the company’s 2006 and 2009 fiscal years, HP grew revenue from $91.6 billion to $114.6 billion and more than doubled its earnings per share.
Even during a challenging 2009 fiscal year, Hurd minimized HP’s financial slide. For the year ended Oct. 31, 2009, HP's revenue came in at $114.6 billion, a decline of 3% compared to $118.4 billion reported a year earlier. Net income fell 8% to $7.7 billion from $8.3 billion in 2008.
Hurd's own compensation took a much sharper dive. His total 2009 compensation package totaled $24.2 million, a 29% decline compared to $34 million in 2008. (Read how much tech's other top execs made in '09)
To improve HP’s operating efficiency, he has made staff cuts and ordered a companywide pay cuts. Hurd has also shown a willingness to play the big spender. There has been no shortage of billion-dollar deals during his time as CEO.
In April, HP announced plans to buy Palm in a deal valued at $1.2 billion. Less than six months earlier, HP laid down $2.7 billion to acquire 3Com, adding the company’s Ethernet network switches, routers and security products to its ProCurve business.
In August 2008, HP closed its acquisition of technology services giant EDS. The $13.9 billion deal helped HP leapfrog over its services provider competitors to land behind IBM as the second largest global outsourcing company worldwide.
In 2007, HP paid $1.6 billion for Opsware, gaining automation technology that could be applied to configuring and provisioning physical and virtual data center components. A year earlier, HP acquired Mercury Interactive for $4.9 billion, seeding a new division for business technology optimization.
Details are scarce about the nature of the sexual harassment claim lodged against Hurd, but the company has said an investigation determined there was no violation of HP’s sexual harassment policy, but did find violations of HP’s standards of business conduct.
“As the investigation progressed, I realized there were instances in which I did not live up to the standards and principles of trust, respect and integrity that I have espoused at HP and which have guided me throughout my career,” Hurd said in a statement. “After a number of discussions with members of the board, I will move aside and the board will search for new leadership.”
HP’s board appointed CFO Cathie Lesjak, 51, as interim CEO. Lesjak is a 24-year veteran of the company.