HP shakes up board again, Lane steps down as chairman

HP shakes up board again, Lane steps down as chairman

Summary: HP turns over its board as investors are still seething over the Autonomy acquisition debacle.

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Hewlett-Packard Chairman Ray Lane is giving up his post as the company initiates yet another board shake-up. Lane's tenure featured a few massive debacles.

Ralph Whitworth, a shareholder activist, will be a stand-in until a replacement is named. Lane will stay on HP's board, but John Hammergren and G. Kennedy Thompson will step down.

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The moves, initially reported by The Wall Street Journal, CNBC and others, represent another shakeup for HP's historically dysfunctional board. But CEO Meg Whitman and the company had to do something following a series of missteps.

  • First, there was the HP acquisition of Autonomy. HP bought Autonomy in 2011 for a whopping $11 billion and drained its balance sheet.
  • Then HP wrote down $8.8 billion in goodwill for the deal.
  • And finally, HP claimed it bought Autonomy based on shady accounting.

Where was the due diligence on Autonomy? While the answers are still fuzzy, the solution is clear. The board had to have some turnover. It's also worth noting that Hammergren and Thompson barely kept their board seats.

In a statement Lane (right) said:

After reflecting on the stockholder vote last month, I've decided to step down as executive chairman to reduce any distraction from HP's ongoing turnaround. Since I joined HP's board a little over two years ago, I've been committed to board evolution to ensure our turnaround and future success. I'm proud of the board we've built and the progress we've made to date in restoring the company. I will continue to serve HP as a director and help finish the job.

Lane managed to distance himself from former CEO Leo Apotheker, who was also on the Autonomy bandwagon. Lane joined HP at the same time Apotheker was hired. The duo, which was far from dynamic, was supposed to push HP into the software business with gusto.

In another board move, HP said that the role of lead independent director, held by Rajiv L. Gupta, will be eliminated. Gupta will remain on the board and will replace Thompson as chairman of the audit committee. Gary Reiner will replace Gupta as chairman of the nominating and governance committee. Whitworth will become chairman of the finance and investment committee.

Topics: Hewlett-Packard, Data Centers, Hardware

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12 comments
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  • HP needs to quit

    HP has been screwing customers long enough.
    Time for them to get out of the business.
    BruceAnd
  • "Too-Big to Flail?"

    Apparently, not...
    deltadan
  • Musical chairs on the Titanic

    HP's pathetic situation is a result of a stodgy, risk avoiding internal engineering culture ("why would anyone want to buy a home computer?") wedded to the very best (worst) that American professional corporate management has to offer. I experienced the former when I worked there, the latter makes a spectacle of itself in public as covered by the press on an ongoing basis.
    Sir Name
  • Hp - Ray Lane

    it is stunning that many of these execs have no shame at all. They screw up so much and yet they refuse to leave till they are pushed out. But an ordinary employee doesn' t have that luxury of saying longer like the execs do and still reaping millions. I am sure Lane will leave with a minimum $25m package and life long healthcare,etc...it seems these execs are the mini dictators of our free loading capitalistic society. I think the entire boad need to be fired and hanged.
    kanank
  • you could pick

    three bums and a crack ho off the street and put them on the board and they would do a better job. At least they understand the value of a buck.
    NoAxToGrind
  • The big/unstructured data bubble bursts

    but HP were dumb enough to believe in it.

    Expect numerous other write-downs and company failures in the big data space in the near future.
    jorwell
  • All failures aside...

    I currently have 3 HP computers at home (2 laptops and a desktop) and support 2 more desktops for my parents and in-laws. Plus 2 HP All-in-one printers. I have NEVER had a hardware problem with any of them, and the software problems were always fixable. Everyone seems to bitch and moan about how bad their products are, but I have never seen it. Do they have bloatware? Yes, but that doesn't make them unique. I haven't bought anything that wasn't HP in the last 6 years, and I have no regrets about it.
    trybble1
    • I Agree

      I currently have a 6-year old Desktop running Vista and recently purchased a notebook. Except for the Vista quirks, they both rock. On a side note, it would be wonderful if the MS board fired Ballmer for (at least) the Win8 & WnPhone8 debacle.
      Gr8Music
    • Products vs. management

      Their product teams are what has kept HP alive despite all of the attempts by its board to destroy the company. Trust me, there is criminal activity on the HP board. Nobody is that inept unless it was purposeful sabotage.
      flyguy29
  • A DELL drone that likes HP

    I agree with trybble1. I have had good experiences with HP desktops, laptops, and printers that fill my home ! I work for Dell and have to sadly report that I've had way more trouble with my Dell products than any of the HP stuff I own.
    cschweers
  • Another HP Positive Experience

    While I've purchased hundreds of Dell PC's, I always steered users to HP printers and AIO's; and have had personal best experience with HP desktops. HP laptops have lagged behind however. HP has failed to market itself the way Dell does to government customers.
    HickoryC
  • At that level you can get away with anything

    I still think Autonomy is good technology and HP either should have or should be able to hire the talent needed to make money with it, but what were they smoking when they coughed up $11 billion for it? I’d like to see everyone involved with overpaying by $8.8 billion summarily fired for gross negligence, given ten minutes to clean out their desks, and escorted out the door with NO severance or bus fare. And the same for those who hired Léo in the first place.

    But considering the Big Spaccone of Merrill got $160 million in severance when he was fired for comingthiscloseto doing a Lehman with worthless mortgages, it’s clear that when incompetence and malfeasance in Corporate America results in the blowing of Real Money, the more you blow, the larger your severance. Nine figures of severance is no problem if you squander enough money. I wish I could get a deal like that!
    AES2