Andy Isherwood, the UK and Ireland MD of Hewlett-Packard (HP), tells CBR the latest about the company’s five-year restructuring plan.
Andy Isherwood, MD UK at HP, joined the California-based company 25 years ago on a graduate scheme. He served as SVP for worldwide sales, service and support before taking up the post in November 2013.
HP announced its restructuring plan for financial recovery back in 2012. What you hope to achieve with this?
What we’ve done really well in the past couple of years since Meg (Whitman) has come back is kind of reignite and reinvent the kind of technology of the company. There are very few technology companies that invest a lot of money in R&D.
We invest $4bn a year in providing and inventing software and hardware to bring to market. We’re not just a copycat company. I think with the predecessor to Meg, maybe we’d lost a little bit of sight on the importance of that.
HP said it is now focusing on the ‘new style’ of IT. What does that mean for HP and its future focus?
The new style is driven by the interrelated trends of cloud, security, mobility and big data, and how people are going to consume technology moving forward. Small and large businesses are under tremendous pressure to deliver faster services and applications in both the enterprise and consumer market. We’re trying to give people the solutions to make the most of the opportunities connected to these areas, meaning that we can give businesses the whole package with the new style of IT.
What recent plans have you made to enable this?
We’re acquiring companies and developing networking, service and storage products. Take our Moonshot server system as an example, which delivers computing power in a completely new way. Why is it important? Because data centres are getting bigger and bigger as space becomes more expensive. Moonshot consumes less power and are designed to better cope with increasing amounts of data.
How is HP innovating to compete against Microsoft, IBM and Lenovo among other companies?
The whole competitive landscape is changing pretty dramatically. We don’t see IBM as that big a competitor today because they’re very focused on a particular market. We compete with them in the services space, but that’s all really. As the market evolves to more service-orientated consumption-based models and cloud, we have a different set of competitors. You have the likes of Cisco, which is moving out from high-margin networking products because we’re coming in and being very disruptive to their old technologies.
Lenovo has also been a strong and increasing presence in the laptop and desktop space, no question about it. They’ve done a pretty job at executing, but we’ve done a better job given our market share. Now that they’ve taken on and bought the server business from IBM for $2.3bn, the server market is bigger; they’ve got to now integrate a business, which will cause some delay and some uncertainty for customers and complex integration.
Figures released by analyst firms IDC and Gartner show that sales for PC devices keep getting worse. How is this affecting HP?
We’re seeing a significant increase in our market so it doesn’t concern us at all. There are less players in that market, so what is addressable for us is bigger. The other thing is, historically, people would have a laptop and they would then have a mobile phone and they would probably have a desktop at work. I think what people will tend to have is two of the three moving forward. Because the gap between a laptop and a mobile device has become a lot smaller I believe that you will have one of the two in addition to a desktop, if you come into an office on a regular basis.
How is the buyout of Autonomy fitting in with HP?
Autonomy has products that can basically understand and make meaning out of unstructured data from social media, voice and email, which is tremendously difficult. The augmented reality products are still in relatively early stages, but this is something we’re hopeful about.
Are there any other challenges that HP is faced with as it looks towards the future?
I see a lot of opportunities. If you think about the macro-economic picture, there will be a 3% GDP growth, so that’s got to be positive for capital expenditure, while predictions for IT spending overall are 2%. The opportunity for us is that we have an awful lot of customers in the UK ranging from consumers using personal devices all the way up to big enterprises. So there’s a big journey that people will have to make as we move to more of a cloud orientated consumption based model.
HP announced in December last year it was cutting almost 1,000 jobs in the UK as part of its global downsizing plans. How is this affecting the business?
If we hadn’t made changes in relation to the construct of business and employment, our financial performance would not be as good – we’d be left behind. You have to continually evolve your workforce to match the market needs. The nature of the business is clearly changing, so requirements from people and skill sets need changing. A lot of the people who are affected are quite often redeployed into other bits of the business.