HP gets a new CEO

Hewlett-Packard once went for flamboyance and style with Carleton S. Fiorina, the chairwoman and chief executive who was fired in February. ...

Hewlett-Packard once went for flamboyance and style with Carleton S. Fiorina, the chairwoman and chief executive who was fired in February. On Tuesday, the company chose to return to its traditional low-key management approach in naming Mark V. Hurd, the little-known president and chief executive of NCR, a maker of computers and automated teller machines, to succeed Fiorina.

The appointment of Hurd, who led a turnaround at NCR through operational improvements and cost-cutting, underscores the Hewlett-Packard board8217;s commitment to a growth strategy led by an expansion into consumer electronics. Wall Street was enthusiastic about the choice of Hurd, 48, as a steadying influence to lead Hewlett-Packard, which experienced disappointing profits in the last four years. Its shares rose 1.99, or 10 per cent, to close at 21.78 on Tuesday, though a formal announcement of the appointment was not made until after the markets closed.

The chairwoman of Hewlett-Packard, Patricia C. Dunn, said the appointment of Hurd was a strong statement that the company did not intend to unravel its merger with Compaq or sell off other major pieces of its business.

Rather, Hurd is seen as an executive who can bring discipline and order to the diverse portfolio of businesses that includes personal computers, corporate servers, printers, cameras, software and corporate services. In dismissing Fiorina, the board said it was not interested in changing its strategy of offering a full range of digital products to consumers and businesses.

8216;8216;HP8217;s directors chose wisely,8217;8217; said C.K. Prahalad, who is a member of the NCR board and a professor at the University of Michigan business school. Hurd, who spent 25 years at NCR, has deep knowledge in the details of running a business and is a good motivator of people, Prahalad said.

The challenges Hurd now faces are substantial. Hewlett-Packard, based in Palo Alto, California, is in fierce competition with IBM in the market for corporate information technology services. It is also in a bruising fight with Dell Computer in the PC market and increasingly in the printing business, one that Hewlett-Packard has long dominated.

Dunn said the board believed that the company had the right mix of businesses and had chosen Hurd precisely because it believed he was the best candidate to carry out the company8217;s strategy.

Story continues below this ad

8216;8216;We were looking for someone who could run these businesses,8217;8217; she said. 8216;8216;Our strategy is to execute, and Mark is very strong and execution-oriented.8217;8217;

Whether Hurd is able to turn around Hewlett-Packard, he will receive a handsome compensation package.

The details of his package, which were filed on Tuesday with the Securities and Exchange Commission SEC, include a base salary of 1.4 million in addition to bonuses of up to 2.8 million for meeting performance goals.

8212; NYT