Ray Lane’s exit gives CEO Meg Whitman chance to revive Hewlett-Packard

SAN FRANCISCO: Hewlett-Packard Co’s board shakeup, including Ray Lane’s exit as chairman, gives chief executive officer Meg Whitman a clearer path to revive growth and shake off years of tumult at the world’s largest computer maker.


A former president of Oracle Corp, Lane failed to use his extensive experience in enterprise computing to help Hewlett- Packard’s turnaround. His public gaffes -- including being photographed using an Apple Inc computer-also sometimes served as an embarrassment to the company.

Lane, 66, instead bore the stain of the disastrous 11-month tenure of former CEO Leo Apotheker and the company’s acquisition of software maker Autonomy Corp, which led to a $8.8 billion write down and accusations of accounting fraud.

To build on the momentum that Whitman has begun to show, the board is seeking a new chairman with global experience and who can devote more time and energy to revival efforts, Pat Russo, a company director, said in an e-mailed statement.

Until then, Ralph Whitworth will serve as interim chairman. “Somebody has to be symbolically accountable,” said Jeffrey Sonnenfeld, a management professor at Yale University in New Haven, Connecticut. In addition to Lane’s move, directors G Kennedy Thompson and John Hammergren are departing, Palo Alto, Californiabased Hewlett-Packard said in a statement. Lane “decided to step down,” Whitworth wrote in a blog posting.

Hewlett-Packard declined 1.5% to $21.97 at the close in New York. While the shares had rallied 54% this year amid tentative signs that Whitman is making headway in her efforts to reignite growth, the stock has lost half its value since the departure of Hurd.

Lane, a distinguished-looking, gray-haired elder statesman of Silicon Valley, is known as something of enterprise computing’s Mr Fixother hardware the company traditionally sold, to more lucrative software, despite a mandate to expand in that area.

NARROW MAJORITY

Lane is giving up his chairmanship two weeks after investors reelected him in a narrow majority of votes, issuing a rebuke of his oversight of the botched Autonomy acquisition. “It’s not typical to get a withhold vote, and if you do you’d usually resign,” said Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware.

“Lane deserves credit for stepping down. If he’d stayed on he’d become the issue.” After the March 20 vote, during the shareholder meeting at the Computer History Museum in Silicon Valley, Lane believed he wasn’t given sufficient credit for remaking the company’s board and ousting Apotheker, a person familiar with his thinking said.