Hewlett-Packard Searches For New CEO Ousted HP CEO Mark Hurd reportedly has settled allegations of sexual harassment lodged against him by a female contract worker. An investigation into the claims cleared Hurd of harassment but concluded that he had misused company funds. Technology writer Arik Hesseldahl of Bloomberg BusinessWeek talks to Steve Inskeep about Hurd's resignation.
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Hewlett-Packard Searches For New CEO

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Hewlett-Packard Searches For New CEO

Hewlett-Packard Searches For New CEO

Hewlett-Packard Searches For New CEO

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Ousted HP CEO Mark Hurd reportedly has settled allegations of sexual harassment lodged against him by a female contract worker. An investigation into the claims cleared Hurd of harassment but concluded that he had misused company funds. Technology writer Arik Hesseldahl of Bloomberg BusinessWeek talks to Steve Inskeep about Hurd's resignation.

STEVE INSKEEP, host:

It's MORNING EDITION from NPR News. Good morning, Im Steve Inskeep.

We know a little more this morning, about the events that cost a CEO his job. We're still trying to figure out what it means for his giant company, Hewlett Packard.

Mark Hurd was the CEO until he was forced out. The company said he falsified expense reports to cover up the money that he spent on a woman.

We're going to talk about this with Arik Hesseldahl of Bloomberg BusinessWeek. He's with us live.

Welcome to the program.

Mr. ARIK HESSELDAHL (Reporter, "Bloomberg BusinessWeek"): Hi. Thanks for having me on.

INSKEEP: Over the weekend, we learned the woman's name. She identified herself, Jodie Fisher. Who is she?

Mr. HESSELDAHL: We know she was on a reality TV show. She was a sales associate for certain large companies. And that she worked in some kind of a marketing capacity for Hewlett Packard, basically hosting events where Mark Hurd would be the star attraction and meeting with executives of other companies, typically HP customers.

INSKEEP: Now, she's attractive actress, of course. She has put out a statement saying: I did accuse him of sexual harassment. We settled that, though, and I never meant for him to lose his job over this.

Does that change the story at all?

Mr. HESSELDAHL: It's a little bit surprising, I think, because what ultimately happened was, when she made the initial accusation, HP has a special committee on its board of directors that investigated this and basically found that according to its standards for sexual harassment, no sexual harassment occurred.

What finally ended up bringing Mark down was these expense reports, something on the order of $20,000 or less - which is not all that much money for a man who's paid millions a year - was improperly paid.

INSKEEP: These were dinner expenses and that sort of thing, travel expenses?

Mr. HESSELDAHL: Exactly. Exactly, and which kind of raises some questions about the nature of the relationship, just a little bit, because, as you see, you know, Ms. Fisher has said that no intimate relationship occurred.

INSKEEP: But his problem here, according to Hewlett Packard, is simply that he did not put the right names. He didnt say whose travel he was paying for. He didnt say whose dinner he was paying for.

Mr. HESSELDAHL: Precisely. He, basically, it was falsified - it was someone was getting paid, when on the expense report, it was someone else.

INSKEEP: So how are people taking this inside Hewlett Packard?

Mr. HESSELDAHL: It's probably a big shock. I mean, Mark Hurd had been the executive who had essentially really turned the company around. He joined in 2005. The company was very demoralized at that point. Carly Fiorina had just left - Carly Fiorina, of course, now the Senate candidate in California. And it had taken on this enormous acquisition of Compaq Computer in 2002, and it really hadn't turned out as well as Fiorina had promised. And Mark really got the company going again.

If you had held Hewlett Packard's stock during the period, from the day that he joined as CEO, it would be up 120 percent - you'd be a fairly happy stockholder. In fact, the day he joined - I went back and looked - the stock moved 10 percent.

With that said though, you mentioned Carly Fiorina. Of course, there was also Patricia Dunn, the chairwoman who was found to have been spying on journalists. Now you have this latest scandal. The picture we get from the outside is management in disarray over a period of years. Is that really the way it is felt to people inside HP?

Mr. HESSELDAHL: I definitely, I think there are some shades of that here. The pre-texting matter, to which we refer Patricia Dunn - the chairwoman losing her position - that is definitely kind of casting a shadow here. Basically, I think the board of directors decided that it couldnt have a chief executive with even the slightest hint of impropriety, in the wake of that scandal only three years ago.

So I think there was, you know - and other companies might have fined him, might have disciplined him, might have reprimanded him in some way, might not have even gone public with something like this unless, of course, it led to a lawsuit. But HP's board decided that they just couldnt have a CEO on board, with a hint of impropriety, falsifying his expense reports.

INSKEEP: So very briefly, can a company this giant coast along for a while without a strong leader?

Mr. HESSELDAHL: Thats the one kind of good thing for HP in this story, is that it was in a fairly strong position - it is in a fairly strong position. A lot of that is because of Mark's cost-cutting. He's been a very aggressive cost-cutter.

But the big question now, is who is it going to be? It's going to be an internal candidate who takes over the current interim CEO, is Cathy Lesjack. She says she doesnt want the job. So will HP go internal or external, thats really the big discussion today.

INSKEEP: Mr. Hesseldahl, thanks very much.

Mr. HESSELDAHL: Thank you.

INSKEEP: Arik Hesseldahl of Bloomberg BusinessWeek, talking about the forced departure of Mark Hurd, from HP.

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