To: kaka who wrote (2849 ) 5/6/2003 3:29:32 PM From: The Duke of URL© Respond to of 4345 Ya know, it actually LOOKS like Miss Carly be doing exactly what you would want a big-time successful executive to do: If you read between the lines, you will see what a devastating mistake it was to spin of Agilent (word on the street was it was done just to further the founders tax planning) and how Carly (along with CPQ's Shane Robison, the next President of H-P) is moving VERY rapidly to reform and re-energize and focus a more efficient H-P. ++++++++++++++++++++++++++++++++++++++++++++++++++++++ Story last updated at 8:34 a.m. Tuesday, May 6, 2003 Hewlett-Packard shifts focus to innovation $3B cost-cutting effort poses challenge to developing, implementing research BY JOHN MARKOFF New York Times News Service KEYSTONE, COLO.--The gathering here of 400 of Hewlett-Packard's top scientists and engineers was intended to reassure them that the company was determined not to depart from its historic focus on research and development. "HP Invent is not just an advertising logo," Carly Fiorina, Hewlett-Packard's chief executive, told the audience in her Monday keynote address. "It is a fundamental representation of our past, present and future." A year after orchestrating a controversial takeover of Compaq Computer, Fiorina likes to boast that the company is one year and a half-billion dollars ahead of schedule in combining the two operations. And as she framed it here, a leaner and meaner research and development operation will not just preserve the Hewlett-Packard brand, it also will help extend it. But that $3 billion cost-cutting effort, crucial as it is to the company's success, also poses a serious challenge to its ability to innovate in the fast-consolidating computer industry, analysts say. Indeed, as John Grebenkemper, a veteran engineer who came to Hewlett by way of Compaq and Tandem Computer, rehearsed his presentation for the research group, he could not help quietly admitting some bad news to another manager. "It's been a very hard week for me," he said. "I had to lay off 40 percent of my group." And one engineer received lively applause when he told Fiorina during a question-and-answer session that "the thing that gets hit first" in the rush to meet the company's quarterly financial targets "are those new ideas." The company believes it still has plenty of big ones. As an internal showcase for Hewlett's hot new technologies, the conference was a winner. On display was everything from just-over-the-horizon three-dimensional printers to more futuristic devices, like electron beams that could one day pave the way for 10 gigabit memory chips 20 times more capacious than the current generation. Many of those who attended said it was a promising first effort toward what Fiorina considers crucial: exploiting cooperation among engineers and scientists to restore the company's ability to compete. Hewlett's overall research and development efforts now are being guided by Shane V. Robison, a veteran of Compaq and Apple Computer. He has indicated the company will concentrate its research in areas like software for corporate computing centers, computer security and privacy, along with designing new mobile devices. But for many outside experts on corporate research, it is still an open question whether Hewlett can rekindle the synergies it once enjoyed in computing and materials science research before 1999, when it spun off Agilent, its scientific equipment and medical instrument business. "They took away what was really powerful about HP Labs," said Robert Buderi, editor of Technology Review magazine and an expert on corporate research laboratories. "They haven't gotten their edge back." Buderi emphasized Hewlett-Packard was still very strong in several areas of promising research. And, Robison said, that is the way the company wants it to be. In the old days, Robison explained, big companies like IBM and AT&T were able to support research into a vast array of subjects. But "given the pace of change and the amount of change, that's not possible," he said. "I want to reach deep in the areas we care about." At the same time, Hewlett-Packard must find a way to change its product development culture to enable it to move more quickly and respond more nimbly. It is a problem Hewlett-Packard acknowledges has plagued it in the past. "We certainly have the technology," said Thomas J. Perkins, a Hewlett director who heads the new technology subcommittee of the company's board. "But sometimes we haven't capitalized as quickly as we should have."