Business Technology: HP Makes A Strategic Move By Hiring Mott - InformationWeek

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10:34 PM
Bob Evans
Bob Evans

Business Technology: HP Makes A Strategic Move By Hiring Mott

In the six years Randy Mott was CIO at Wal-Mart, its sales tripled. In the five years he was CIO at Dell, its sales increased more than 60% and it rose to global prominence. Now Mott is at HP--can he do it a third time?

Hewlett-Packard has 150,000 employees in 170 countries around the world. The leader of those troops, CEO Mark Hurd, joined the company a few months ago and faces some significant challenges: restoring the company's prestige and lofty image, clarifying product directions, defining a global strategy, reinvigorating employee morale, and reviving growth. Clearly, none of HP's 150,000 people has a job more important than Hurd's.

But another new addition to the executive team has a job that, while not more important than Hurd's, might be every bit as important: Randy Mott, who joined HP seven days ago as executive VP and CIO. Not only does HP gain a brilliant and possibly unrivaled business-technology executive, but his hiring from Dell removes from HP's most relentless competitor a key architect behind Dell's extraordinary ascent to the ranks of the world's most successful, admired, and powerful corporations.

Consider: During the five years Mott was CIO at Dell, the company's revenue grew more than 60% to more than $51 billion; it took over the top spot in market share in many of its key businesses; it became a powerful force in enterprise computing while simultaneously accomplishing the same thing at the consumer end; it managed its inventory far better than any of its competitors, giving Dell huge advantages in keeping costs down and product cycles up; and it set lofty standards for efficiency, speed, supply-chain excellence, and global consistency.

While Mott's departure from Dell will be a daunting gap for the company to fill, Dell's remarkably strong management team and culture will compensate quickly. And although it will be just about impossible for Dell to find a CIO equal to Mott, the company has such widespread brainpower and such a deeply ingrained commitment to relentless business-process improvement that there shouldn't be much of a noticeable impact on its operations.

At the same time, though, it's probably also fair to say that for the next year or so, Mott's absence will mean that Dell won't be able to create and implement global innovation as quickly and vigorously as it did during Mott's tenure. So for Dell competitors who've been looking for any possible vulnerability in the company's prospects, there's perhaps a glimmer of hope. But not for long.

On the other hand, Mott's arrival at HP should have a huge impact on a company whose market stature and prestige have been pounded over the past few years by Dell. I recall talking to an executive in the computer side of HP's business a few years ago who said, "Dell has NOTHING on us except a little supply-chain and logistics advantage. But we're aware of that now, and after we address that, Michael and his boys are going to be in a world of hurt." Yeah, right--that bit of wisdom belongs right up there with this one from French military strategist Marshal Ferdinand Foch in 1911: "Airplanes are interesting toys but of no military value."

But strategic value is precisely what HP is getting in Mott. Back in 2000, when he left Wal-Mart after a 22-year career that started with a job right out of college as a programmer and ended up as CIO, I remember seeing some comments from people who said things along the lines of "What a mistake. Why is a highly technical computer company that sells directly to consumers hiring a guy out of the mass-market retail world? It doesn't make any sense." I think what those comments overlooked was this: At Wal-Mart, Mott specialized in cutting latency out of the supply chain and ultimately increasing customer intimacy by helping to ensure that the seller was offering what the buyer wanted, when the buyer wanted it, and at a price the buyer accepted. As a result, in the six years that Mott was Wal-Mart's CIO, the company's sales almost tripled.

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At Dell, among Mott's biggest contributions were helping the IT team set strategic priorities and putting in place global standards for infrastructure, security, applications, and processes. Shortly after Mott started at Dell, he told me that the can-do culture had gotten a bit out of control in the IT department, which caused a lack of focus. Because the company was so entrepreneurial, he said, the IT team was loath to turn down any request from a business unit, and then made it even tougher on themselves by agreeing to impossibly aggressive deadlines. "So I asked the team to put together a list of strategic projects they were working on and said we'd meet in a couple days to discuss them. At the meeting, they handed me a list of about 250 projects, and every single one of them was marked, 'Strategic.' So I said, 'Folks, this won't work. We're gonna stay in this room til we cut this list down to 12. If we don't do that, and if we keep chasing all 250, we'll never get anything done.' "

So I asked how long it took to get the list from 250 down to 12. "Oh, we got it done at that meeting," Mott said with an easy laugh. "It wasn't fun, and it wasn't quick, but we got it done. And once we got our priorities set, we were able to be a lot more effective."

And Mott will also have a big impact on HP's ability to execute consistently and rapidly across the globe. At Dell, he had a policy dictating that any global application had to be rolled out around the world in no more than six months after it was up and running in the country where it was launched. That timetable was the only way to support Dell's rapid cycle of new ideas, processes, and products on a global basis--without it, new ideas and processes would be stunted by old systems that were too rigid or slow to support them.

Over at HP, it will be hard for Mott to match--let alone top--his accomplishments at Wal-Mart and Dell. But this quiet and very decent man is in an environment where change will be welcomed, where innovation is prized, and where there's a huge opportunity to push Hewlett-Packard back toward the globally prestigious position it held until recently. His track record says he will make the very most of that opportunity.

On the other hand, maybe Randy Mott was just lucky to become Wal-Mart CIO as it became the largest company in the world, and maybe he was just lucky again to join Dell just before it become a paradigm of corporate excellence. But if you believe that, you probably believe this one, too: "Airplanes are interesting toys but of no military value."

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