This past weekend, Hewlett Packard’s head honcho Mark Hurd abruptly resigned as CEO of the world’s largest technology firm, amid a firestorm of controversy involving actress-turned-marketing consultant Jodi Fisher. Surprisingly, it’s not Fisher’s 2007 sexual harassment case against Hurd that led to his ouster; it was filing faulty expense reports.
Following news of Hurd’s resignation, H-P’s stock has lost more than eight percent of its value. In his five plus years as CEO, Hurd restored H-P to profitability, more than doubling the stock, mostly due to his no-nonsense approach to business.
Hurd’s predecessor Carly Fiorina, now a candidate for the U.S. Senate, also was ousted by the company’s board. Fiorina’s departure, however, was tied to poor performance, a long-standing issue while she was CEO, and primarily due to her inability to fully leverage the company’s acquisition of Compaq in 2002.
The trick now for H-P is to find a successor to Hurd, and the challenge is managing the transition with effective communications. Could H-P’s recent stock drop have been mitigated with a better communications plan? That’s debatable. Hurd had a positive influence on the company’s performance.
Indeed, it’s hard for any organization to manage a crisis, and strategic public relations is essential in these matters, especially when a company has to communicate contentious news to its constituencies, i.e. investors, employees, and the general public. Even a tactful tweet can go a long way, but it has to be smart and sincere. We’ll see how H-P investors react when the company reports on August 19.
-- George Medici, gmedici@pondel.com
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