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The Contender: How Ann Livermore Is Shaking Up HP She got staid Hewlett-Packard into gear on the Net, then nearly won the CEO stakes. No wonder techdom is buzzing about her In the spring of 1998, with Hewlett-Packard Co. stuck in one of the deepest funks of its 60-year history, the company's top executives agreed to put themselves through a so-called 360-degree evaluation, in which they open themselves up to criticism from employees, peers, and board members. Just another another meaningless management exercise? Not for Ann M. Livermore, then head of HP's $5 billion software and services business. "I learned that I'm a very, very well controlled executive, but that my employees like when I go off the handle every once in a while -- you know, show my human side," says the 40-year-old Livermore. "It reinforced that leadership means touching people's hearts as well as their brains -- so since then I haven't worried so much about keeping my lid on." That's for sure. Since then, Livermore has developed from a cautious practitioner of HP's consensus-oriented management into a lightning rod for change at Silicon Valley's granddaddy of technology companies. It was she who finally got HP into gear on the Internet. After years of fragmented efforts, she broke through HP's highly decentralized structure of warring tribes to create an "e-services" vision that has put HP into the Net game with IBM and Sun Microsystems Inc. And when HP CEO Lewis E. Platt announced in March that he would step down, Livermore shocked some at HP by confirming that she wanted his job.
Now Livermore stands out as a potential chief executive at other technology companies. "If nothing else, she has made herself a much better candidate to be CEO elsewhere," says Bain & Co. consultant Vern Altman. "Coming in second doesn't hurt her internally, and companies who had never heard of Ann Livermore will now consider her for CEO." Livermore, who is taking a long-overdue vacation in North Carolina, says she plans on staying at HP and isn't looking outside for her next opportunity. "I already have one of the best jobs in the industry," she says. Indeed, insiders say Livermore might have been HP's new CEO if she'd been at her current post longer. After years of running HP's software and services business, a strategic backwater in a company known for its computers and printers, last November she was put in charge of a newly created $14 billion "enterprise" computer division. That unit for the first time combined HP's back-office computer divisions with those focused on software and computer services. "If Livermore had been in that job for six years, she'd have been a bigger contender," says Salomon Brothers analyst John B. Jones. COACH IMAGE. Still, Livermore's brush with history is the capstone of a remarkable ascent. When she joined HP in 1982 as a Stanford University MBA, she did so mostly because she hit it off with the interviewer, who happened to be from her hometown of Greensboro, N.C. And she was attracted by HP's reputation as a great place to get basic high-tech training. "I never thought I'd stay at HP," she says. "I figured I'd stay for three or four years and then either go to a startup or go back to North Carolina. I'd have bet you $100 on it." And she would have lost. She soon fell for HP's egalitarian, team culture. Known more as a coach and general manager than as a strategic or operational whiz, she fit in well. And by coupling her composed Southern charm with a willingness to make tough decisions, she helped hardware-focused HP slowly build up its software and services business. Recently retired HP executive James Arthur, her long-time mentor, says she was able to avoid getting bogged down by "terminal niceness" -- a common HP affliction that prevents fast decision-making. "She just makes things happen," says Arthur.
She led an effort to break from this decentralized structure to create one organization that would drive a Net plan. "I felt we could be the most powerful company in the industry if we could get our hardware, software, and services aligned," she says. By last November, with a rudimentary plan on paper, Platt agreed to put her in charge of the overall Enterprise Computing unit, which combined these elements. Livermore wasted little time in putting those plans into action. First, she whipped through more than 1,000 geeky HP press releases to take an inventory of the various technologies and products HP had hidden away in its empire. "I ended up with 1,000 points of light, but no bright beams," she says. Working with a team of long-time HP managers and a band of cyber-savvy consultants, they quickly pulled together the e-services strategy. The basic idea is that in the future Networked Economy, corporate customers will want to outsource computer operations to companies like HP and its partners, who can manage complex applications and Web sites for them -- and quickly add new capabilities. "We had a choice of playing catch-up [with Sun and IBM], or of looking beyond the next hill," says Livermore. FIGHTING WORDS. By mid-February, with the plan done, she put e-services into overdrive. On Feb. 17, she articulated the significance in a memo to her 44,000-person unit. "We need to move quickly and decisively. We need to focus," she wrote. "But focus implies discipline and a willingneness to make tough choices. That means that some people's favorite projects may be realigned or redirected. That means supporting decisions, even if you would have preferred another outcome." That may be tepid stuff in harder-edged companies, but they were fighting words at HP, say insiders. What's more, Livermore rapidly moved beyond just organizational makeovers. For example, she gave the go-ahead on a $1 billion-plus spending spree to fill in the technical holes in HP's portfolio. Within months, her unit had signed big joint-development deals with middleware company BEA Systems and E-commerce software maker Broadvision Inc.; made equity investments in E-banking software company First Security Technologies and E-commerce portal company ViaLink; and struck innovative deals with electronic marketplace Ariba.com and Web application host Qwest Communications in which HP agreed to exchange computer gear for a share of their future Net-related revenues.
Bolstered by such successes -- and by a shortage of other internal candidates -- Livermore's name was already on the shortlist to replace Platt when the search started in earnest last spring. And when she publicly confirmed that fact -- something other HP execs declined to do -- the rumor mill began to focus on her. To be sure, she actually did little else than express her interest in the job. In repeated interviews, she praised HP's board for "casting a wide net" by looking outside as well as inside HP for the best candidate. And she says her increased visibility in recent months is less a function of a campaign to be CEO than it is due to an Apr. 6 decision by Platt to give her and three other HP executives CEO-like responsibilities over their businesses. Part of Platt's orders: Speak more to the press and Wall Street analysts. How does Livermore feel about HP's choice of Fiorina? "Of course, I'm disappointed," she told Business Week on the day HP annnounced Fiorina's selection. "I wouldn't be very human if I wasn't disappointed. But the HP company has hired a great leader." That may sound like so much posturing -- especially since her run for HP's top job has put her high on headhunter lists as a candidate for other CEO jobs. Even so, friends expect Livermore to stay at HP and continue pushing the e-services strategy. If she stays, she probably won't sit still. Burrows writes about the computer industry out of Business Week's Silicon Valley bureau. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ |
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 Ann Livermore: Head of Enterprise Computing at HP WEB POINTERS Click here to visit the site mentioned in the story: Hewlett-Packard | |||||||||||||||
