The new CEO is a key part of the company's reorganization into two separate companies, the larger one to focus on computing and imaging and the smaller to take over test and measurement operations. The larger company will retain the Hewlett-Packard name but is in search of a new CEO to replace Lew Platt, whereas the smaller company has its CEO, Ned Barnholt, but is missing a name. It's simply called "NewCo" for now.
It's likely that the new CEO for HP and the new name for NewCo will be announced in the late June or early July, said Michael Fournell, who recently was appointed the head of public relations for NewCo.
In addition, public trading of NewCo stock likely will take place some time between mid-November of this year and January 2000, assuming favorable market conditions, Fournell said. The timing is intended to give investors a reasonable time to digest results of HP's fiscal year, which will be publicly announced mid-November, he said.
HP probably will file forms in July describing its initial public offering (IPO) plans for NewCo with the Securities and Exchange Commission, Fournell said.
Despite recent speculation that Hewlett-Packard is now turning outside the high-tech arena for its CEO search, the computer giant is sticking to its game plan of staying close to home.
"The search is not expected to go outside the industry," said one source familiar with the company. That means HP watchers should not expect to see a Lou Gerstner or John Sculley type of move, in which outsiders were plucked from the likes of such companies as RJR Nabisco and Pepsi to lead a computer company.
In March, HP announced Platt would step down after the company reorganized and named a new CEO for its computing and imaging company.
Although HP's board hasn't given its search committee specific requirements in selecting the next CEO, the directors have outlined some general guidelines, sources said.
"The search is continuing and we're waiting to make an announcement when we have a name to announce," Fournell said.
Even if HP decides to keep the ambit of its search inside the computing world, analysts generally are stating that HP needs to go for a charismatic figure over an operations person. Overall, HP's individual businesses seem to run relatively smoothly. What the company lacks is an visionary that can give life at HP meaning.
"HP is noticeable for not having 'the guy,' the executive that exudes power and confidence," said Roger Kay, computer analyst at International Data Corporation. "They have the nuts and bolts. They need a force."
"They need someone to light a fire," added Ashok Kumar, an analyst at US Bancorp Piper Jaffray, who said the company would probably have to look outside for a CEO.
With Oracle's Ray Lane stating that he will stay put for now, the list of prospective candidates has grown shorter, but it still reads like a who's who of computing. Among internal candidates, both Ann Livermore, CEO of HP's enterprise computing group, and Duane Zitzner, CEO of the computer products division, are mentioned most often. Livermore, 40, heads up HP's e-commerce and corporate computing projects. Recently, she has also become one of HP's more visible executives. And, while it might be irrelevant, Platt in years past was identified as one of the executives spearheading efforts to place women in greater roles of authority at HP.
Zitzner, 51, oversees HP's PC division. Although less glamorous, PCs have been one of the brighter spots for HP. The company has gained market share and avoided many of the inventory issues that have plagued other companies. Both Livermore and Zitzner have worked at HP for a number of years.
Nick Earle, head of enterprise marketing within Livermore's group, has confirmed that Livermore is a candidate. Sources have said that Livermore is a strong possibility, because she heads HP's "e-services" campaign to benefit from sophisticated business transactions on the Internet.
Outside candidates include Rick Belluzzo, CEO of SGI, and Paul Otellini, general manager of the Intel Architecture Business Group and heir apparent to CEO Craig Barrett.
The split-up continues
The company is in the process of dividing its workforce in two, Fournell said. HP asked all employees which company they'd prefer to work for. In most cases, there's a clear division, but some corporate departments such as lobbying, legal, or public relations will have to be divided in two.
In addition, the company should finish by tomorrow the task of deciding which facilities in HP's 120-country operations go to which company, Fournell said. Again, in most cases it's obvious, but, for example, HP's European headquarters in Geneva, Switzerland, will be left to HP, while the NewCo personnel will need to find new quarters, he said.
HP also had to split its labs in two, leading to the addition of new staff in areas where both companies will need research capabilities.
"We're very close to getting finished," he said.