HP's dangerously dysfunctional Board of Directors

Time Frame
2015
View Point
The board of directors has a long list of obligations that includes
responsibilities to ensure the strategic direction of the company
Hire qualified management,
Monitor their performance
Design their compensation,
Oversee the establishment of risk management controls,
Ensure the integrity of financial reporting,
Oversee the work of the external auditor,
Ensure compliance with all legal and regulatory requirements,
Disclose material information to the public,
Oversee the acquisition and disposition of corporate assets,
Communicate effectively with shareholders and stakeholders.
Despite the length of this list, however, many believe the
fundamental obligations of the board are quite simple and distill
down to two: 1) evaluate and approve the corporate strategy and 2)
hire and fire the CEO.

I.

Problem
How can HP change the board without losing too many
resources?

II.

Objectives
The achievements of an organization are the result of the
combined efforts of each individual in the organization working
toward common objectives. These objectives should be realistic,
should be clearly understood by everyone in the organization, and
should reflect the organization's basic character and personality.

III.

To identify the root and cause of all mishaps that had

happened in the past 16 years.
To analyze all datas gathered that could lead to the salvation
of the company.
To come up with an immediate solution to the growing
mismanagement issues inside HP
To avoid further loss for the profit and stocks of the company.
To develop a long term plan for every business components
namely, human Resource, Financial Department, Marketing
and Product Development.

Areas of Consideration (SWOT Analysis)

STRENGTH

Strong Market Position.

Good at bringing new affordable designs in the market.
Serves 400 clients in the government sector.
Has a very sound and effective distribution network
globally.
Various acquisitions of other IT companies have allowed HP
to move into other technological markets.
As of 2013, there is improvement in profitability.
Workforce of 3,500,000 employees globally
Consumer centered approach to business.
Strong and recognizable brand name.

In 2014, Launched a new analytic platforms that helps

healthcare professional.

WEAKNESSES

2011, Goldblatt filled a consumer class action against HP

regarding a certain security issues on one of its product.
Market Share Growth is minimal and slow due to its
competitors.
Public sees HP unclear on its overall direction as a
company for having 3 CEOs in 3 years.
Competitive advantages seem to be deiminishing with the
rise of other companies like Apple Inc.
Involved in controversies that can negatively affect their
brand image to investors and customers.
Imitation products are being passed off as official HP
products, thus a decline in sales.
HP is far behind the other technology such as Mp3 Players,
Televisions and Head Phones.
Weak total quality management.

OPPURTUNITIES

Bought EDS, the #2 service provider in the world

expecting a potential growth in service industry.
Expansion in cloud computing market.
With society moving towards to technology based future,
there will be consistent demand for desktops and laptops.
HP started entering the health industry and it has been
successful, this could open door in the said industry.
Acquisitions of Companies like Compaq and Palm Inc. have
opened doors for its revenue making abilities.

THREATS

Company controversies
Rise of competitors such as Apple, have greatly affected
brand and popularity.
Lightly saturated market
Growing trend of paperless storage and transfer of
information.

IV.

Dysfunctional board members.

Alternative Course of Actions

1 Give CEO succession planning sufficient energy and time
It is the current CEOs responsibility to develop as many
potential CEOs as the board could- leaders who would be ready
and able at any time to lead the company especially HP under
any circumstances the company face in the global economy, the
consumer products industry and the company. The objective is
to groom more horses for the race- horses that could run in all
kinds of conditions and on all kinds of tracks. The CEO should be
consistent in wanting the race to be a long one. The board should
also be in the position when it is already the time for the current
CEO to hand over the reins- in choosing the person who best met
the standards and best fit the specific needs the company would
face over the next decade.

An engagement and open and spirited discussion,

deliberation, and debate among the directors, between the
directors and the CEO is the way to unleash the real power of an
ongoing succession process. Everything demands time.

2 Elevate executive leadership development

The CEOs job and his executive team is to make sure that
the company has enabled every leader to develop to his fullest
potential. HP should elevate leadership development to the same
level of importance as business strategy. The company should
put in place capabilities and systems to manage talent, such as
performance assessments, assignment planning, formal
leadership training, and so forth. All business reviews of HP
should now began with an evaluation of the strength of the
organization and included specific development and growth plans
for key executives in every unit and function. A rigorous talent

assessment always preceded the review of actual business and

financial results, strategies and operating plans.
3 Refine the CEO criteria
HP should learn to go beyond the obvious business and
financial results and assess potential performance based on
intangibles. Business and financial results should not be a
standard to discriminate among contenders. And even qualities
like IQ can be deceiving. The smartest guy in the room doesnt
always have the EQ (self-awareness, empathy and social
relationships) or the judgment to be the best possible CEO. The
company should held in-depth, highly personal competency
between the candidates, and interviews of the potential
candidates of the various ages. Soliciting feedback from external
executives and outside sources- other CEOs, suppliers,
customers, investors and partners with knowledge of the
candidates is needed for the board to know the best from the all
the candidates.
The CEO Job is an incredibly lonely job, which is why you
need EQ to go with IQ, the ability to connect and collaborate, real
courage, and impeccable judgment. The board needs to
understand all these variables.

V.

Decision Matrix
Problems

Alternative A

Alternative B

Alternative C

Give CEO
succession
planning
sufficient
energy and
time

Elevate
executive
leadership
developme
nt

Refine the
CEO
criteria

Potential
Impact on
Company
Performance

10

10

Speed of
Implementatio
n
Acceptance by
Associates

10

10

10

10

TOTAL

26

30

28

Good-8
Better-9
Best-10

VI.

Action Plan
1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

Conduct a
general
executive
meeting
regarding
about the
issue

Hold Monthly
meetings
specialized for
executive
improvement

Hold a Team
Building for
the Board to
development
team work

Assessment of
Everyones
performance

Enroll the CEO

in different
trainings that
could help her
do her job
well.

Training
Modules for
the Board and
CEO

Establish
Performance
Standards document
systems

Prepare every
documents
needed for the
next quarters

activities.

VII.

Conclusion
Finding and developing its leaders is the most important
investment a company can make. Therefore, one of the biggest
challenges facing companies today is in ensuring the optimum
performance from its senior executives. This requires time,
investment and, most of all, the right expertise
Executive coaching is the right pill for this complication with
the CEO. The executive coaching will focus
and expedite leadership development to create growth
opportunities and the reinforcement needed for clients to
achieve their goals.
Since the problem is the incompetence of the CEO and board,
it will be easy to say Just Replace Everyone. If only it could be
that easy but it isnt. Replacing the board could mean war with
the board and it could face illegal conflicts.
The next solution would be accept and work with what he
have and improve it. HP Board lacks employee development
activities. This could be the main reason why the HP board failed
to be efficient and competent for the last 16 years. The objective
is to promote not just unity in the board but to highly enhance
the performance of the board and be able to perform its main
role in the company, approve and decide for the faith of it.

VIII.

Recommendation
The proposed alternative course of actions mentioned above
could actually be a bigger action plan for the company. After
executing the plan for elevating leaderships excellence, an
evaluation is required. The evaluation will help the firm
determine the liabilities of the company thus, leading it to
gathering and working with the right people. The next step might
be improving and setting up a strict guideline for the CEO
qualifications enabling the board to hire a worthy for the position.