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Q&A: HP's Livermore sees no need for HP-UX on x86

She also weighs in on last week's earnings report

By Robert McMillan, IDG News Service, and Patrick Thibodeau, Computerworld
August 17, 2004 12:00 PM ET

Computerworld - This can't be an easy time for Ann Livermore. When Hewlett-Packard Co. missed Wall Street's earnings expectations late last week, the blame was placed squarely on the shoulders of the Enterprise Servers and Storage Group, one of the divisions she manages. "Unacceptable" problems within the group cost HP $400 million in revenue and $275 million in operating profit, said HP Chairman and CEO Carly Fiorina just hours before HP announced the sacking of three senior executives within the division (see story).
Though HP says the operational disruptions that caused last quarter's shortfall are now behind it, daunting challenges remain for Livermore, who, as executive vice president of HP's Technology Solutions Group, manages the company's enterprise storage, systems, services and software products. Livermore must pull off the trick of moving a diverse set of PA-RISC, AlphaServer and HP 3000 customers to HP's Integrity line of Itanium servers, while simultaneously shoring up HP's once-proud storage business, which has been struggling of late.
Livermore, a 22-year HP employee who was considered a front-running candidate for the job that went to Fiorina, met with Computerworld's Patrick Thibodeau and Robert McMillan of the IDG News Service at HP's annual HP World user conference in Chicago this week to discuss the state of her company.

Why did the enterprise computing group lose money this quarter? There were really a couple of main areas where we didn't execute as well as we needed to this quarter. In the United States, we were transitioning to a new system and set of business processes for our order management and manufacturing operations, and that transition caused more disruption than we had planned. As a result of that, we didn't ship as many of our servers, particularly our ProLiant servers, as we had planned during the quarter.
In Europe, we had some issues around our channel management processes, as the European team centralized some of the claims processes and channel compensation processes. So that was another area where we just didn't execute well. We also had, in a few instances, in EMEA [Europe, the Middle East and Africa] more aggressive discounting than what we had originally planned for.

So the good news -- or the bad news -- is that they are all internal execution issues that we can address ourselves. They're not things that are fundamental weaknesses in our business offerings.

What about the storage group? With the storage business, we introduced a set of new product offerings back in April, which was a strong refresh of the product line, and we have another major set



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