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MARCH 8, 2005
Handicapping the HP Hopefuls Techdom's top names are popping up as the search to replace Carly hits overdrive
Hewlett-Packard Co.'s (HPQ ) search for a new chief executive -- only the sixth permanent chief in the tech giant's 66-year history -- is gathering momentum. A successor to former CEO Carleton S. Fiorina could be named as early as the end of March, just seven weeks after Fiorina was forced out. And as the list of candidates narrows, at least one surprising name has popped up. Richard E. Belluzzo, a longtime HP exec who now runs data-storage company Quantum Corp. (DSS ), has emerged as "a strong candidate," according to two sources close to the search. The list of candidates remains in flux, but a number of high-powered execs have been approached. Sources familiar with the search confirm that other names include 3M (MMM ) Chief Executive W. James McNerney Jr., Intel (INTC ) Executive Vice-President Sean M. Maloney, Symantec (SYMC ) CEO John Thompson, and John Joyce, IBM (IBM ) senior vice-president of global services. These executives say they are not interested in the HP job, but the board continues to vet potential candidates, with would-be CEOs presenting proposals about strategy. Finding the right candidate fast is critical. Often such searches take three to six months. But the company has little time to waste as it struggles to improve internal execution and stem losses to rivals Dell Inc. (DELL ) and IBM. Since the start of 2004, HP's stock is down 8%, trailing nearly every competitor, while Dell's price has soared 20% during the same period. Even if a new CEO is named by the end of March, it could take months to settle on a firm agenda for reviving the company. "You'd have to get into the trenches of this company for six months to figure out a plan that will win," says Jeffrey Christian, the executive recruiter who spearheaded the search that brought in Fiorina in 1999. "ROCKET RICK" Would Belluzzo be the right man for the job? The 51-year-old executive certainly knows HP's businesses and culture. After joining HP as an accountant in 1975, he earned the nickname "Rocket Rick" as his operations and distribution skills propelled him to the top of company's printer and computing businesses. Known for his hard-working ways, he executed the plan of mentor Richard A. Hackborn, an influential HP director, to make the company a powerhouse in high-volume consumer markets. While he was deemed the company's heir apparent before he left for the CEO job at Silicon Graphics Inc. (SGI ) in 1998, some say his focus on commodity products led to the decline of HP's corporate computing unit. Belluzzo's post-HP track record, moreover, has been lackluster. His efforts to turn around Silicon Graphics foundered after a move to Windows-based servers failed to work; that was followed by a rocky stint as the No. 3 at Microsoft Corp. (MSFT ). Since becoming chief executive of Quantum in 2002, Belluzzo has earned kudos for cost-cutting and crafting a new game plan for the data-storage company. Still, the company's stock has inched up just 3% during his tenure. Belluzzo did not return numerous calls seeking comment, and an HP spokesman declined to discuss the search. Whoever steps into the corner office obviously will face a challenging task but will have some room to maneuver. Despite calls from Wall Street to break apart the company, HP's board has publicly stated that it expects the new chief executive to manage businesses ranging from digital TVs to tech services. But one candidate who spoke with the board said the internal message isn't so inflexible. The board is open to considering strategic options, such as spinning off the PC unit or the printer division. An HP insider adds that while it's unlikely they will hire someone pushing a spin-off, HP is "open to discussion over strategy." Whichever big-name exec that turns out to be, the key is finding the right fit -- the faster the better.  By Ben Elgin, Cliff Edwards, and Peter Burrows in San Mateo, Calif., with Michael Arndt in Chicago
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