5. Dumping the Alpha chip architecture
HP acquired DEC's Alpha chip architecture along with Compaq when it bought the rival PC maker. Alpha was perhaps the fastest processor available at the time and represented a strong opportunity for HP to challenge IBM's Power chip architecture in the mission-critical and high performance computing markets.
However, HP had not developed Alpha and it already had its own PA-Risc line of processors, so it stuck with building PA-Risc systems to run the proprietary HP-UX variant of Unix, leaving Alpha in the ditch.
HP's obsession with Itanium likely had something to do with this decision, but in hindsight it seems obvious that PA-Risc couldn't keep up and Itanium has failed to work out. Perhaps HP might be better positioned in the high end computing markets if it had recognised what it had in Alpha and put some resources behind it years ago.
4. Buying Palm
Buying flailing personal digital assistant (PDA) maker Palm for $1.8bn was one of HP's biggest mistakes right from the start.
HP looked to Palm to kick-start its charge into the mobile market, but with such fierce competition from competitors like Apple and Google that strategy was always destined for failure.
Sure, WebOS is a good mobile operating system, but pairing this with a dinky-pebble shaped phone with an impossibly small keyboard was a concept that wasn't destined to set the world alight, not even with HP's branding on the back. Even the relatively decent but overpriced HP Touchpad had to be practically given away to customers to clock up some sales.
3. Investigating its own board members
In 2005 it was revealed that late HP chairwoman Patricia Dunn had hired a team of security experts to investigate the company's own board members in a bid to identify the source of an information leak to journalists. Private investigators reportedly used illegal methods, but were never prosecuted.
Dunn's witch hunt among HP's own board members ultimately backfired, resulting in the resignation of HP director Tom Perkins. Board member George Keyworth was accused of leaking information about HP's long-term strategy to journalists and also resigned, despite denying the allegations.
2. Hiring Leó Apotheker
Leó Apotheker was the great man of software giant SAP when HP hired him as CEO, having led the German company successfully for years, but his 10 month tenure at HP was arguably the biggest disaster to befall the firm in decades. Apotheker rode in on a wave of high expectations after the firm booted Mark Hurd following a sexual harassment charge that was settled out of court and a related expenses fiddling scandal.
Apotheker's time at HP included two almost inexplicable decisions. He announced that HP would spin off its PC division at a time when HP is the biggest PC vendor, and would shut down its tablet and smartphone lines just a year after HP had bought Palm for over $1bn.
With Apotheker seemingly making irrational decisions, HP's stock price, tanked with confidence in his vision for HP waning. Although Apotheker got a very handsome payoff, HP was left reeling, looking for its sixth CEO within a decade.
1. Losing faith in its PC business
HP shocked and confused everyone when it announced that it planned to quit the PC business last year. It made it worse when it said a week later that it might instead "spin it off or sell it" - surely the same as quitting - before denying the whole thing, then finally making a complete U-turn a couple of months later and deciding to stick with the PC business after all.
The decision to keep the PC business came after the company realised that personal computers contribute to its brand value and the operation would be much too expensive to spin off into a separate company. It was a shame that HP didn't think about that before baffling us all and leaving its customers with little trust in the company. µ
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