IT Management News

Why HP is different from IBM

Tags:
Transition,
Economic,
Business Unit,
Cash

Colin Barker ZDNet.co.uk

Published: 31 Mar 2008 16:09 BST

Last year, HP overtook IBM as the largest IT company in the world when its revenue hit $104bn (£52bn) for the year ending in October, with IBM trailing at around $98bn.

As head of the company's Technology Solution Group (TSG), 20-year HP veteran Ann Livermore sees few limits on the potential growth of the systems and software supplier.

Livermore, who joined the company in 1982 and has held various senior positions in the company, speaks from a position of some authority. The TSG division is a substantial part of HP with its focus on the systems used every day by companies around the world, the software and the growing services business. The other two divisions that make up the remainder of HP are the Imaging and Printing Group, and the Personal Systems Group.

ZDNet.co.uk caught up with Livermore at the company's Technology@Work event in Barcelona recently, and discussed the differences between her employer and IBM, the adoption of virtualisation, and whether HP is really interested saving the environment or just making more "green".

How do you see the current troubled economic situation? Do you think it will affect your brands?
[We see that] happening in the marketplace in terms of the financial services industry and some of the macro-economic trends associated with it. We are staying focused on the same strategy, so our strategy does not change as a result of this. In fact, we see many customers who have the capacity to still invest to save.

We aim to be number-one or number-two in every one of the markets we participate

Ann Livermore

In a datacentre transformation what you are really doing is making an investment in a new infrastructure, to then be able to generate savings over a longer period of time. So those companies that have a strong cash position will often choose to do that.

The outsourcing business is also something that is a very attractive opportunity for many of our customers if they are feeling economic pressure. With our outsourcing business we can take on the datacentres and some of the employees from our customers and help them drive down the cost of their operations. So outsourcing businesses tend to be counter-cyclical in terms of their growth.

It is only recently that HP has seen outsourcing as key to its business. How is that going?
[Our] outsourcing business has many clients around the world. Procter & Gamble is a very large client for HP, where they have outsourced their entire, global IT operations to HP. We have an outsourcing relationship with Nokia, with Ericsson, with BT, with Unilever, with Pfizer. These are very large clients who have not just little but significant outsourcing relationships with us.

And we have smaller relationships with many companies where we perhaps just do the desktop or we just do the SAP or Microsoft Exchange. So we have the very large ones, like the ones I just mentioned, and then smaller ones based around the geography or business unit or the applications.

With the help of many different parts of the business, including services, you are now the biggest IT company in the world. You don't see any limitations in how big you can grow?
I think that HP's ambition is not so much size-focused. We aim to be number-one or number-two in every one of the markets we participate. So it is more in terms of leadership in the segments where we participate.

You know, we want to be not just the biggest but also the best. So when you look at the best, you want to have the best financial performance, you want to have the best customer satisfaction and loyalty and you want to attract the best talent. So what we are really after is to be the leading...

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