HP's CloudPrint Heads into BlackBerrys

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To hear Scaglia tell it, though, the makeshift setup didn't detract from the demo. "It's one of those ideas where once you see it, you say, 'yeah, of course,'" says Scaglia, who was present at the demo.

Managing the tension between conducting corporate research by the numbers and recognizing the value of "a-ha" moments will be key to HP's goal of increasing technology transferred out of its labs. Shaw Wu, a senior analyst at Kaufman Brothers , notes that while licensing revenue from products like CloudPrint is a drop in the bucket for a company with $118 billion in annual sales, technologies that emerge from HP Labs can give the company advantages in PCs, printing, and other key markets. "If they're able to out-engineer Dell (DELL) and Acer, not only does it drive out costs, but they can change their strategy," he says.

Banerjee is bullish on a new user interface for PCs being tested in HP's Bangalore (India) lab that lets computer novices use hand gestures and voice commands to control machines. "It's extremely cool," he says. The interface could find a home in the PC division's "customer experience group," which is crafting new ways of interacting (BusinessWeek.com, 9/5/08 ) with computers. Another team is working on thin, flexible displays the company believes it can use to supply future screens for laptops, which would allow HP to control component costs and source materials more cheaply than rival Dell. And mathematical operations research born in its labs has helped HP's personal-systems group optimize the way it buys PC components, saving $300 million in inventory and supply-chain costs over three years. Banerjee's goal now is to increase by an additional 50% the number of tech transfers from HP Labs to product groups, technologies licensed to other companies, and academic papers published by HP scientists. He concedes that transforming the formerly slow-moving labs will take time. "It's not like tomorrow we flip a switch," he says.

Banerjee has already hit some roadblocks. A year after announcing a partnership with Foundation Capital intended to connect HP with startups that could commercialize technology from its labs, the two entities are still trying to reach an agreement on a formula for revenue-sharing. And Banerjee's results-driven approach to research is bound to vex some HP engineers. Indeed, as Huberman's work on CloudPrint shows, the new boss may have a tough time yoking some lab veterans. Looking back over his CloudPrint project's ad hoc trajectory, Huberman mused: "I don't know if this subverts the whole process."

Ricadela is a writer for BusinessWeek in Silicon Valley.

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