HP Printer and PC boss: Lenovo is the LAST thing on my mind
Dion Weisler on the art of strategy...
Interview The man straddling HP's global printer and PC portfolio has a few things on his mind, but he claims worrying about Apple, Samsung and Lenovo aren't chief among them.
Dion Weisler left a senior role in Lenovo to head up HP's PC biz in Asia Pacifc/Japan in 2011, the same year former CEO Leo Apotheker was unpicking decades of hard work by some of his predecessors.
The exec was then asked to replace Todd Bradley at the head of the merged Printers and Personal Systems unit last summer, around the time his previous Chinese employer snatched the global PC crown from HP.
The 75-year-old tech titan continues to play second fiddle to Lenovo in the total global PC market, and is fourth behind the three firms mentioned in true opening paragraph in the total device space.
So El Chan asks Weisler, does size really matter?
"I am not interested in share for share's sake," he tells us. "I am absolutely interested in winning in the markets where we choose to play, but the art of strategy is as much about choosing where not to play as choosing where to play.
"Am I particularly interested in the race to the bottom of a $80, $70 or $60 tablet? Not at all. Would it give me share? Yes. Is it high calorie share? Not not at all."
The Aussie national spent some of the earlier years of his career at Acer, the company that at one time pursued market share at all cost. It had the lowest cost base of any PC vendor and stacked 'em high and sold 'em cheap. This always looked unsustainable… because it was.
HP has relinquished the top spot across the total PCs but in commercial computers, where there's been a revival due to Windows XP and a wider corporate refresh, driven by the uptick in the economy, "I do want share," he tells us.
"We took back the number one position in commercial, we stated that we were going to index ourselves to the commercial market. We believe we have a lot of IP there, 150,000 of the best channel partners in the world, we can differentiate."
In its fiscal Q2 ended April, HP grew PC sales for the fist time in 21 months, with revenue up seven per cent, but it was commercial shipments behind this expansion, as retail sales continued to shrink.
"Consumer is still a contracting market," says Weisler. "Commercial has returned to growth, it's a bigger part of our mix".
A retrench is not surprising; HP flirted with slabs via the doomed TouchPad when Mad Leo was on board, and with smartphones too. Neither products worked out, both were costly messes.
HP re-entered the slab market last year with the ElitePad, which was unashamedly aimed at business, though this market segment is still relatively small in the sales stakes.
"We are not doing a very broad brush [in tablets] with a global portfolio that will be exactly the same everywhere. Across the entire line-up, whether it be print or personal systems, I'm orientating the organisation toward commercial because that is where our strength is. This is true for mobility too," the HP exec adds.
He reckons mobility is where the internet was in 1999 when email and static web pages were the main uses. "Mobility is the same; it will transform work flows of almost every organisation whether it's the postal service or an airline".
The 64-bit version ElitePad hit the streets this year but mobility is clearly about more than the device: "How we help manifest and change those workflows will be key," says Weisler.
HP has nothing to announce on this but is "pivoting" R&D dollars, he insists.
HP has launched consumer "tablones" or phablets in India via local HP World stores - this is a country where it has 33 per cent market share of the PC market, and specifically designed the product at a price point for that market.
"If I were to do that broad based everywhere it wouldn't have that same impact so we are selectively going after parts of the market where we think we can win.
"Other parts of the market that might be already owned by other people where we don't believe we'll make money, we don't play there."
He tells us that "some markets" in Europe are in line for an HP phablet but Weisler isn't releasing a scoop, and when asked about timing, says 'You'll have to wait and see".
The attitude on tabs extends to smartphones: "There are two companies that make money today on smartphones, so the ability to deliver on the long term sustained profitable growth is not best served through a mass launch," he says.
Has HP missed the boat? "You always look forward. This industry is undergoing enormous amount of change and with any kind of change that creates opportunity."
So if keeping the foot on rivals' throats in commercial is the strategic game, what about the consumer market: is it time to split the consumer and professional division? Seems unlikely, as that side of the house boost economies of scale.
"We are certainly not giving up on consumer, at least in the US 40 per cent of SMB customers buy their product from consumer channels, and you've got BYOD.
"At some point I think economies of scale reaches levels of diminishing returns, particularly in times of disruption where there is more supply than demand, where the whole eco system is shaken up. Go and check whatever the market shares were for Intel and Microsoft five years ago versus today - and that drives different dynamics as well."
The Wintel stranglehold on the market has loosened with the advent of ARM designs and Google's Android OS. Microsoft, for example, holds around 13 per cent of the total device market worldwide.
The importance of consumer to HP is also the technology convergence with business life. "I've met with a bunch of CIOs and all of them, whether they've got 20k staff or 200,000, they will almost tell you uniformly the same thing: I have to serve four generations of employee and the needs of my 20-year-olds could not be more different than the needs of my 60-year-old employees."
Long gone are the days where citizens tended to get access to the latest tech at work: "That experience is happening at home and that is informing your commercial life", the HP man says.
"These two worlds are actually converging on each other and inform each other, so whilst today I have a consumer division and a commercial division I believe that in don't know whether it is three, four, five years time I will have one." ®