Can CEO Meg Whitman Find Time to Run Hewlett-Packard?

by Tom Taulli | October 26, 2011 10:37 am

It’s no mystery why CEOs make huge amounts of money. The good ones have unique skill sets, combining leadership, a strong sense of anticipating market trends and seemingly flawless execution. But they possess something else that’s often overlooked: good time management.

Only a few CEOs — like Apple’s (NASDAQ:AAPL[1]) former boss, Steve Jobs — have the mental bandwidth to micromanage a global operation. Things get even tougher when a company is experiencing big-time problems.

A prime example is Hewlett-Packard (NYSE:HPQ[2]). The company has terminated three CEOs in the past six years. It’s a veritable executive Bermuda Triangle.

The latest CEO to walk through the Hewlett-Packard turnstile is Meg Whitman. And she has a stellar background. She was critical in building eBay (NASDAQ:EBAY[3]) into a dot-com powerhouse. She also had executive positions at companies like Hasbro (NASDAQ:HAS[4]), FTD and Disney (NYSE:DIS[5]).

And Whitman’s compensation at HPQ? An annual salary of $1 — OK, and a big slug of options, too. She definitely believes in the upside.

But a troubling announcement came out this week: Whitman joined the board of a dot-com start-up company, Zaarly, that has created a marketplace that allows people to post offers — say, to have their house cleaned or find someone to teach them how to play the drums. It’s kind of like a next-generation craigslist.

Doesn’t Whitman have enough on her plate already as the head of a $50 billion market-cap company? Not to mention Whitman also serves on the boards of Procter & Gamble (NYSE:PG[6]) and Zipcar (NASDAQ:ZIP[7]). Her time seems crunched as is.

Whitman needs to figure out how to stabilize Hewlett-Packard and repair the company’s loss of confidence with investors, as HPQ stock has lost about 40% of its value this year. She also needs to determine whether to keep or unload the company’s PC business, as well as come up with a software strategy that can deal with intense competition. HP recently spent $10 billion on Autonomy, which will be at the core of this segment.

It’s a lot of work, and Whitman definitely has a history of success. But if she continues to pile up the outside distractions, she might be setting Hewlett-Packard up for another leadership failure.

Tom Taulli runs the InvestorPlace blog “IPOPlaybook[8],” a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of “All About Short Selling”[9] and “All About Commodities.”[10] Follow him on Twitter at @ttaulli[11]. As of this writing, he did not own a position in any of the aforementioned stocks.

  1. AAPL:
  2. HPQ:
  3. EBAY:
  4. HAS:
  5. DIS:
  6. PG:
  7. ZIP:
  8. IPOPlaybook:
  9. “All About Short Selling”:
  10. “All About Commodities.”:
  11. @ttaulli:

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