HP gets a bit saucy (sorry….)

Mark Hurd, CEO of Hewlett-Packard, one of the largest IT firms in the world and one of (if not THE) largest supplier to the UK public sector, resigned last Friday.  As the Telegraph said,

"The HP probe was sparked following allegations from a former contractor, with whom Mr Hurd admitted he had a "close personal relationship". The company also said that Mr Hurd submitted false expense reports in an effort to conceal the relationship.

This "having a relationship" thing has got really big in US firms now, with codes of conduct becoming widespread; I'm not sure it is quite such a big deal in Europe yet.  Indeed, in certain European countries it is still pretty much compulsory for executives to participate in at least one workplace affair per annum....

But submitting false expense reports is just unforgivable really (and pretty silly) even if it sounds like they were designed to conceal the relationship rather than personal gain.  But, as in the case of David Laws , the UK Minister who stood down in June, Hurd could presumably have just not made a claim at all,  if (for instance) he didn't want people to see two covers on the restaurant bill.  After all, when you earn $17 million a year....! Or perhaps he'd dug a hole for himself by telling people he was having dinner with a business colleague, then felt he had to put in a claim..I guess it will all come out in time.

There is more here on ZDNet, including about the lady in question, although they stress there is no suggestion that there was any sex or sexual harassment involved. She is a 50 year old single mum although she doesn't look quite as you would expect from that description....

The HP share price went down 10% at the news, which seems a bit excessive, impressive though Hurd may be.  And ironically, the financial results announced at the same time look good.  Attention now turns to identifying his successor as cnet reports. From my recent discussions with several major HP customers – previously EDS outsourcing  customers – the feeling is that, since the acquisition, HP's hardware-sales-based culture has clashed  (and come out on top) with the more service-focused EDS approach.

“The outsourced services provision is just seen as a platform to sell us more boxes” is the sort of comment I have heard.

So it will be interesting to see if a new CEO has a different approach to Hurd in this regard.  However, HP’s results over the last few years have been pretty good, so I wouldn’t  necessarily expect any huge changes.  And HP must be one of the firms most at threat from the UK Government's 'renegotiation of major contracts' and perhaps even more so from the stated desire to break up large IT contracts into smaller elements.  But Mr. Hurd won't be worrying about that now.

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