What’s Wrong With HP?

fissioning HP logo

What is wrong with HP that would spur its announced fission into two daughter companies? My view from the technology trenches is different from what I am reading in the business press.

HP is not really a technology company any more. It is a logistics and marketing company. Much of its engineering is outsourced. I am not surprised that it is splitting itself according to its go-to-market and channel criteria, not technology criteria.

HP does not know how to innovate. Instead of letting a thousand flowers bloom and leaving itself open to positive black swans, it doubles down on big bets. When I was at HP Labs, we were encouraged to only propose projects that promised a billion dollars or more in revenue. There was no room for the small speculative project.

Software is eating the world, but HP cannot write software. It is even confused at the word “software”, using it as the name of a division that is just 10% of the company, even though software is actually crucial in every one of is divisions. HP’s software development is incredibly fragmented, with no returns to scale. Each of its many software development groups scattered throughout the company have their own idiosyncratic software engineering practices, some good some bad. The code of each development group is walled off from other groups, so code sharing across the company is rare. Managers regard access to their organization’s code as a weapon to use in internal battles and negotiations.

HP cannot attract and keep good software engineers. For example, I personally know 24 other engineers who, like me, have made the migration from HP Labs to Google over the years, and there are probably many more. In contrast I don’t know a single person who has moved in the reverse direction from Google to HP. Some of this is no doubt driven by superior remuneration and perks, but I think what really clinches the deal is that in a real technology company what the engineers do really matters. For that they are willing to tolerate the packed elbow-to-elbow work areas and the straitjacket of a company-wide unified software development process.

Maybe HP does need to split, so that at least one part of it has some chance of turning itself back into a real tech company. I wish my friends still there all the best as they navigate the transition.