I spent some of the weekend covering the Mark Hurd resignation with a post titled Hurd’s Resignation and HP’s Odd Half-Decade where I discussed just how logic-defying the situation surrounding the ouster of this CEO is.
Some big news yesterday in the world of technology had to do with Mark Hurd and his resignation following a sexual harassment investigation where he was not found guilty. The woman allegedly involved with Hurd was a former contractor and according to a close source there was no romantic or sexual relationship between the two. What is unusual though is the company on a conference call characterized their relationship as “close” and “personal.”
I am at a bit of a loss to understand exactly what I just wrote means. In other words, did they go hiking together? Were they BFFs? Perhaps they telepresenced each other from time to time. It seems Hurd may have spent some of HP’s money on this former contractor without receiving work.
The board said Hurd did not violate the company’s sexual harassment policies but he did submit expense accounts which were inaccurate to get the company to pay for visits to a marketing contractor. He was essentially asked to resign because of a few allegedly fraudulent expense reports and furthermore because he authorized payment for marketing expenses which did not correspond to work performed.
My next post on the matter was Hurd Resignation from HP Gets Weirder where I presented Hurd’s cases – that the expense accounts were accurate and that he did not voluntarily pay for marketing services which were not provided, the reality is the contract stipulated payment. Here is an excerpt:
Now it seems according to Hurd the contractor wasn’t paid inappropriately and the trips which were expensed were part of legitimate company business.
I must say, a situation which was weird is now getting weirder. Why would the board ask Hurd to step down if there was a chance they were incorrect in their investigation. After all, this is HP we are talking about… The company started Silicon Valley off. They have a reputation which they need to keep and are under a magnifying glass.
Moreover, the scope of what Hurd is being accused of here seems to be minor. You might fire the person making copies if they did something similar but the CEO? And again, the guy cleared $30 million last year… He isn’t poor. If he was going to do something unethical to benefit financially, wouldn’t it need to be for a few hundred million or billion dollars to be worth his while? It seems like a few thousand dollars we are talking about or at least less than $100,000 assuming a corporate jet was involved. Something does not add up – in fact nothing does and I wonder if I need to stay awake all weekend watching this story for updates.
I have to reiterate how much weirdness there seems to be in the upper ranks of HP and the board. I have never seen anything like it. There must be more to the story – much more… Either that or this potential scandal may go down in history as one of the worst PR blunders of the year.
Somewhere in London and New York, execs from BP and Goldman Sachs respectively are watching all this and saying to themselves, now that company has an image problem and needs to get their stuff together.
Now Oracle CEO Larry Ellison has weighed in saying, “The HP board just made the worst personnel decision since the idiots on the Apple board fired Steve Jobs many years ago.” He continued, “In losing Mark Hurd, the HP board failed to act in the best interest of HP’s employees, shareholders, customers and partners.”
According to Reuters, Ellison said the HP board voted 6-to-4 to go public with the sexual harassment claim against Hurd. Oracle went on to rail against the company and said, “Publishing known false sexual harassment claims is not good corporate governance; it’s cowardly corporate political correctness.”
Ellison seems as baffled by the events as I am and finishes his comments by saying the following:
The company’s charge that Hurd engaged in expense fraud was “not credible.”
What the expense fraud claims do reveal is an HP board desperately grasping at straws in trying to publicly explain the unexplainable.
My comments about HP committing one of the worst PR blunders of the year doesn’t go far enough. The company seems to have made what seems to be a huge management mistake followed by an even larger PR disaster. I am still at a loss to understand why precisely Hurd was asked to leave but it would seem the board had other reasons to get rid of him. And once again, a company with past board challenges should know much much better than to act this way.