Tickers in this Article: HPQ, DELL, IBM, EBAY, EMC, LXK, AMZN
Perhaps activist shareholders at Hewlett-Packard (NYSE:HPQ) should agitate for a shareholder vote on whether the board of directors ought to be legally compelled to change its name to "The Gang That Couldn't Shoot Straight." For years now this company has been wracked with poor decisions in and out of the boardroom and the company's latest attempt to address what ails it seems like a long shot at best.

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Out With the Old
There had been rumblings that now-former CEO Leo Apotheker was on thin ice at Hewlett-Packard, and those rumors came to a head Thursday night with the announcement that he was leaving the company. While the press release makes it sound as though Apotheker resigned, the phrasing and the broader context of the rumor mill make it pretty clear that this was a "jump, or we push" sort of situation.

To be sure, Apotheker's tenure at HP was not a successful one. HP has languished a while now as a value play in tech and it is difficult to see where the company is truly dynamic or showing leadership - Asian manufacturers have sapped the PC business, the server business has not fared so well against IBM (NYSE:IBM) and Dell (Nasdaq:DELL), and the company is still struggling to create a real beachhead in software, services and storage.

Then again, this was a bad pick from the get-go. Remember, Apotheker had a rather short tenure as CEO at SAP (NYSE:SAP), due at least in part to his inability to lead the company effectively against Oracle (Nasdaq:ORCL). To hire an unproven software executive to run a multi-armed hardware and software conglomerate like HP was a decision doomed to fail, and fail it did. (Huge companies may not be as infallible as previously assumed. For more, see Conglomerates: Cash Cows Or Corporate Chaos?)

In With the New
Unfortunately, it looks like the HP board still hasn't learned the lesson. The board has named former eBay (Nasdaq:EBAY) CEO Meg Whitman as the new CEO of Hewlett-Packard. Though she clearly comes with a better track record than Apotheker, investors have some reasons for concern here as well.

For starters, Whitman's experience in tech hardware appears to be very limited. Second, while she did a phenomenal job of overseeing eBay's initial growth, she seemed to struggle near the end. Under her leadership, the company paid over $4 billion for Skype (which was later sold in 2009 for less than $3 billion) and basically seemed to luck into the PayPal deal. Towards the end it seemed that she struggled to find a new long-term strategy for the company as the e-commerce world shifted; look, for example, how Amazon (Nasdaq:AMZN) adapted in comparison to eBay and where the companies sit today

HP Has Some Big Challenges
HP may well see its future in software, as exemplified by the large and under-appreciated Autonomy deal, but the fact remains that there is a large legacy hardware business here and the board has now tapped two CEOs with minimal apparent tech hardware experience. This has to be good news to the likes of Dell, IBM, EMC (NYSE:EMC) and Lexmark (NYSE:LXK) for the time being - there is no reason to think that Whitman cannot find good subordinates and become a good hardware/software manager, but it seems generous to assume she'll hit the ground running.

In the meantime, Whitman will have to oversee the spin-out (or sale) of the PC business, the wind-down of the mobile business, and the integration of Autonomy. That is quite a lot to handle and may not leave a lot of time for the sort of large-scale strategic re-think that the company seems to need. That could spell a longer stretch of stock underperformance as investors wait to hear something they like about the long-term strategy. (For related reading, see Parents And Spinoffs: When To Buy And When To Sell.)

The Bottom Line
It's unfortunate that corporate board members rarely, if ever, pay any price for their mismanagement. Clearly HP needs better leadership and better decision-making in that room. Maybe the board, company and shareholders get lucky here - maybe Whitman proves she is one of the relatively rare CEOs who can successfully run two very different businesses. But for a company and shareholder base that needed the board to hit a home-run, this decision looks to be no more than a deep fly ball.

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