HP laying off in Corvallis

Portland Business Journal :

Eugene television station KVAL reports that employees at HP’s Corvallis plant began receiving layoff notices Monday. In a statement, the company said its imaging and printing group announced in June its plans to “realign and streamline” by reducing its business units from five to three. Some parts of the imaging and printing group “will experience reductions while investments will be made in high growth segments of the business,” the company said.

HP is reported to employ about 2,500 people in Corvallis, and 1,000 in Vancouver, Wash. The company declined to confirm these numbers. These two locations, along with a site in Boise, Idaho, are part of HP’s imaging and printing group.

Recent reports in The Oregonian and The Columbian have said HP plans to lay off as many as 300 people in Corvallis, and that some engineers and marketing employees in Vancouver could be told to find work with other HP divisions. HP is also reported to have put its 174-acre Vancouver campus up for sale, with plans to lease it back. HP declined to comment the matter.

EDS and HP Unions : already working together in France

May 20th : hundreds of EDS France employees on strike to fight back WFR and site closures, HP France Unions were there. Same day : IBM France also on strike, for salaries.

HP-EDS merger could lead to services job cuts

"We're looking to streamline our overhead," Shane Robison, HP's chief strategy officer says.

Research and consulting firm Technology Business Research Inc. is predicting fairly substantial cuts. The firm noted that H-P's services division and EDS will have a combined headcount of about 209,000 workers. "The addition of EDS will be a drag on [H-P's service] margins, and CEO Hurd will be aggressively targeting efficiencies," the research firm said in a note. "TBR expects that initial headcount reductions will be at least 10% to 15% of the combined headcount."That would mean 20,000 job cuts or more, although the consulting firm didn't speculate on how those cuts would be divided between EDS and H-P employees.

HP to buy EDS for $13 billion-plus; biggest HP deal since Compaq purchase

Three obstacles that HP and EDS will need to overcome in order for the deal to succeed :

1/Go global : U.S information-technology services companies are in a period of upheaval right now due to the emergence of companies in countries like India that can do a lot of the same work at a cheaper price. IBM and Accenture have both adapted to the new global marketplace, adding staff around the world. EDS and H-P have been slower to globalize. In order for the combined company to substantially improve its margins and win customers looking to cut costs, it will need to shift more work overseas.

2/ Vendor independence : one of EDS's hallmarks was that it didn't have a vested interest in selling its customers software and hardware from any one tech vendor. That independence is now gone: Even if H-P services tries to position itself as vendor agnostic, customers will still be suspicious every time they receive a recommendation for H-P equipment. One mitigating factor: The PCs and other tech equipment H-P sells is fast becoming a commodity. H-P CEO Mark Hurd could be betting that in a few years businesses won't care what company they buy this equipment from because it will all be the same.

3/ Culture clash : forget about how well EDS's suit-wearing consultants will fit in California. The bigger culture clash is between a product-centered company, H-P, and one focused on operations, EDS. Of course, the combined company will be so large and operate in so many different places that it's hard to imagine these legacies mattering as much as, say, how the new company adapts to the various cultures around the world it is sure to expand into.

Source : Peter Allen, a partner at the outsourcing-advisory firm TPI.

HP and journalists settle spy claims

CNET

HP settled claims on Wednesday with four reporters at the heart of a scandal involving claims that the world's biggest PC maker engaged in corporate espionage to plug a boardroom leak. HP and Terry Gross, the attorney representing the journalists, said the company would donate money to several charities chosen by the journalists as part of the terms of the settlement. They did not say how much.

"The matter has been resolved to the mutual satisfaction of the parties, and we are pleased to put this matter behind us," said Hewlett-Packard spokesman Emma McCulloch. She said the company was pleased the money would go to charities.

The scandal, which came to light in late 2006, focused on allegations that Hewlett-Packard hired investigators who impersonated reporters, board members, and employees to obtain private phone records to find the source of leaks to the media in 2005 and 2006. The two sides have been holding settlement discussions since December 2006, Gross said. "It was hard fought to get to a resolution," Gross told Reuters. "I would have expected that they would have taken a tone a long time ago that was basically 'We did wrong. We should make up for it,'" he said. A separate lawsuit filed against HP by three CNET News.com reporters is still pending in a San Francisco court. Those reporters were not part of this settlement.

Hurd Rebuilds HP by Debating `Every Single Dime'

Bloomberg, extr. :
Mark Hurd : "What we want to do is develop a culture that says, `Iwant to debate every single dime,'' . His cuts include spending on jobs, data centers, realestate and even file cabinets... Hurd's next challenge may be weathering a U.S. slowdown. Hurd plans to keep focusing on costs. Last year, the company generated $12 million an hour in sales while spending$11 million on operations. He wants to widen that gap.``I've had a chance to work around high-profile maniacs like Tom Siebel and seasoned guys like Lou Gerstner,'' formerleaders of Siebel Systems Inc. and IBM respectively, said TomHogan, hired by Hurd in February 2006 to run the software unit.``Mark is the most operational CEO I've ever seen". Hurd learned operations at Dayton, Ohio-based NCR Corp.,which he joined in 1980 as a field salesman.
...
`The more you leave the kids in the room to figure it out on their own, the more trouble you're going to get,'' Hurd said. He punctuates almost every sentence with numbers -- marketstatistics, growth rates -- and draws on a flip chart. When he joined HP, expenses were rising as fast as revenue, he said. Within three months, Hurd announced plans to slash 10 percent of the workforce, or 15,000 jobs, to save $1.6 billion a year. He pared retirement benefits to save$300 million. In 2006, he announced plans to replace 85 aging datacenters with six state-of-the-art facilities. That will cut such costs to 2 percent of revenue by early 2009 from 4 percent in 2005. All these moves helped profit more than double to $7.26billion last year from 2004.``If Carly was operating at the 35,000-foot level, MarkHurd is operating from 500 feet,'' said James Post, a professor of management at Boston University.

Hurd has admitted making mistakes. After a spying scandalin 2006 led to the resignation of HP's chairman, two directors and the general counsel, Hurd took responsibility for a probe into boardroom leaks that grew into a plot to spy on directors and reporters. He acknowledged his failure to supervise the investigators and won the backing of investors and analysts after he pledged to repair the company's image.
...

More cuts are planned, including combining call centers in the U.S., Hurd said. HP also aims to pare realestate outlays a third in two years by ``taking advantage of the fact that people are mobile and they don't come into the office every day,'' Chief Financial Officer Cathie Lesjak said. ``We don't have a lot of file cabinets that are necessary.' 'That doesn't mean HP isn't investing in thebusiness, Hurd said. It spent about $7 billion last year on acquisitions, mostly software companies, and made $3 billion in capital expenditures.``You get the strategy right, get the operating model right, get the people right, I mean generally, good things happen to you,'' he said.

HP CEO gets $26M in 2007 pay

HP CEO Mark Hurd received compensation the company valued at $26 million for the 2007 fiscal year. Hurd, 51, took home $1.4 million in base salary, another $1.4 million in bonus money and nearly $12 million in cash incentive payouts.

Hurd also received shares of restricted stock valued at $6.8 million and stock options worth nearly $4 million during fiscal 2007, which encompasses the 12-month period that ended Oct. 31. Also included in Hurd's pay package was $515,000 in additional compensation, including more than $138,000 in restricted stock dividends, nearly $126,000 in expenses for home security services and a mortgage subsidy of about $111,000.

In addition, Hurd made $4.8 million on stock options he exercised, and he had $7.4 million worth of HP stock vested during the latest period. The company has cut costs by consolidating data centers and corporate offices and aggressively slashing its headcount, including the elimination of nearly 15,000 jobs in a massive restructuring launched shortly after Hurd's arrival as CEO and completed in October.

Some 3,000 workers also left the company as part of an early retirement program that HP initiated last year. Investors have been pleased with the changes. Since Hurd took the reins of HP in April 2005, the company's stock price has more than doubled, from around $20 to more than $40 today, a rise that has created more than $50 billion in additional shareholder wealth.

The Associated Press' calculations of total pay include executives' salary, bonus, incentives, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year. They may vary from totals that companies report.
HP calculated that Hurd's pay package was worth $25.3 million.