This has been kind of fun over the years ever since Meg Whitman took over. HPE has been a shadow of its former self and while IBM is also undergoing change it appears to be on a far more successful path. This is largely because IBM’s top executives remain focused on giving their customers a business “Edge” while Meg Whitman still seems focused on “Discovering” what her job actually is. Her big news this month was that she had switched political sides and now supports the Democratic candidate for president which showcases a near historic level of betrayal likely compromising not only Whitman’s brand but HPE’s as well.
Let’s talk about that this week.
Discover vs. Edge
Over the years it has been almost painful to watch these two shows run against each other. It was almost like watching a volleyball game where one team, HPE, sets the ball up for the other, IBM, who then gleefully slams the ball—winning the point. Even the names of the two shows are unbalanced and favor IBM. IBM’s name, Edge, can be applied aggressively and be tied to giving customers a business advantage while HPE’s name seems to suggest that no one, either inside or outside of HPE, knows what the heck HPE is doing because both have to go to a show to “discover it”.
I’m also struck by the contrast between the CEOs, Ginni Rometty isn’t as practiced a speaker as Meg Whitman but she is a subject matter expert having been groomed to be an IBM CEO over a period measured in decades. Whitman, on the other hand, was simply an opportunist with no job experience at HPE’s scale. She just used her position on HPE’s board to help pull the rug out from under the then CEO’s feet—the one the board had previously selected—and place herself in the job in an apparent effort to recover the money she’d lost in her failed political effort. It should be noted she largely lost because she betrayed her long time housekeeper who then hired an attorney and took her to task for it. Loyalty just doesn’t seem to be her strong point.
Under Rometty, IBM has largely successfully pivoted from the firm they were into a cloud powerhouse with SoftLayer and focused on the future, while Whitman has spun out or sold off major parts of HPE and largely failed with her own cloud efforts pushing HPE to a shadow of what it once was.
The contrast in staffing is also pronounced while Rometty’s direct reports have remained comparatively stable, Whitman has replaced some of hers more than once or spun them out as separate companies along with most of HPE’s debt.
While IBM continues to execute on game changing unique technologies like Watson, its Open Power initiative, and its impressive move to turn infrastructure capability into a competitive advantage, HPE has failed to deliver on Moonshot, Memristor, and Itanium—its answer to IBM’s Power—is effectively a dead technology. In fact, most of HPE’s acquisitions since Whitman appear to be in some form of distress.
For those who have attended Discover and wondered whether companies in IBM and HPE’s class even have a chance to recover you’ll see a very different story at IBM’s show. One tied to employee loyalty, over a century of execution and a CEO that isn’t focused on her own income and somehow making a political statement by stabbing her own party in the back and switching sides.
I think this is the difference between a CEO who has been recruited, trained, and embodies the passion of her company operating in the same harsh environment as one that is simply opportunistic and simply focused on restoring her war chest apparently so she could have another failed attempt at politics—this time as a democrat. Though I doubt this history of disloyalty will work for her long term.
Wrapping Up
I think there is a sharp difference between CEOs which translate to how their companies operate and whether they have your back or simply have their eyes on your firm’s wallet. Between firms that mean what they say and say what they mean and political entities that tell you what you want to hear and often blather on about absolutely nothing. Between firms that execute and have executed for decades and firms that can’t even be bothered to hire qualified CEOs.
Don’t take my word for it, if you’ve been to HPE Discover, and even if you haven’t, you owe it to yourself to check out IBM Edge next month. In the end the names tell you all you need to do, Whitman is still trying to discover what a successful CEO does while IBM is focused on giving you a business advantage, an “Edge” if you will, because it knows that strategically the quality of the relationship, not the depth of your wallet, will assure it survives into next century and not just until its CEO fails to run for office again.
Harsh? Yes, I suppose so. But, go and let me know when you determine that what I’m telling you is exactly right. And yes I do think IBM Edge will stomp HPE Discover again this year, it really isn’t the HPE employees fault—the fault is with their CEO and board. Go to IBM Edge and just tell me if I’m wrong or right.
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