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Report: HP Shakes Up Leadership in R&D Division

April 5, 2012

HP corporate

Hewlett-Packard chief executive Meg Whitman has promised the company will double down on research and development as HP plots a course out of a rut that's seen HP shares lose more than 40 percent of their value in the past year, but the company will have to do it without its current head of R&D, Prith Banerjee, according to All Things D.

Banerjee, head of HP Labs for the past five years, is leaving the company on April 15, All Things D reported Wednesday, based on an internal HP memo that the tech site said it had obtained. The top R&D executive, a senior vice president at HP, is leaving the computing giant for a position outside the U.S. and will be replaced by Chandrakant Patel on an interim basis, according to All Things D.

Patel has been with the company for 25 years, is an HP Senior Fellow, and the director of the company's Sustainable Ecosystems Research Group.

Whitman took over leadership of HP last year following the ouster of Léo Apotheker, himself an emergency replacement for ex-CEO Mark Hurd, who left the company in the aftermath of a scandal over allegations of impropriety involving a female HP contractor and allegedly fudged expense reports.

Whitman, a former California gubernatorial candidate, has pledged big changes at HP as the company strives to extricate itself from recent leadership drama and a sense that it's treading water as a technology leader while companies like Apple and Google pass it by.

In her first major public conversation with investors as HP's new CEO last November, Whitman pledged to dial back the company's acquisition-happy ways under her predecessors and to pump more money into R&D at the company, something from which HP has veered away in recent years.

And that appears to be happening. According to All Things D, HP spent $3.3 billion on R&D in 2011, representing about 2.5 percent of sales and up from the $2.8 billion it directed towards such efforts in 2009.

Previously, HP Labs reported to the CEO through the company's chief strategy officer, but Whitman now has HP's main R&D arm reporting directly to her, according to the tech site. What's more, according to All Things D, Whitman has issued a new prerogative to the folks in the lab coats—focus on research than can be quickly be turned into marketable products.

What's unclear is whether Banerjee's rumored departure has anything to do with Whitman's reported focus on more practical uses of HP's R&D investments, or comes in spite of same. Here's the internal memo that Whitman reportedly sent to relevant staff about the change at HP Labs:

HP Confidential

TO: HP Technologists

SUBJECT: Leadership Announcement

I am writing to share the news that Prith Banerjee, senior vice president of research and director of HP Labs, is leaving HP effective April 15, 2012. He will be assuming a role outside the company, which will be announced at a later date. I am pleased to announce that Chandrakant Patel, senior fellow and director of the Sustainable Ecosystems Research Group, will serve as the interim director of HP Labs until a permanent successor is identified.

Prith has been a strong contributor to HP's product innovation and has substantially increased the visibility of Labs within the business. He's led breakthrough research, including data de- duplication, flexible displays, the memristor and nano-technology sensors (CeNSE). Prith has a passion for innovation I know you all share—a passion that will continue to flourish at HP Labs. I wish Prith well in the future.

We're extremely fortunate to have someone of Chandrakant's talent and experience ready to step into Prith's shoes. As you all know, Chandrakant is an HP veteran who has been with the company for 25 years. His team has taken numerous technologies to market, including innovations that span servers to data centers, such as the current research in sustainable data centers which is being transferred to our enterprise business. He will continue to drive Labs forward during this transition, and I couldn't be more pleased that he has agreed to assume this interim role.

Innovation is core to HP. HP Labs generates the research that turns ideas into products. As you have heard me say, one of our goals is to improve the connection between Labs and the business, so we can accelerate the path to market and translate innovation into business results. This, in turn, will help to generate growth and enable continued investment.

Please join me in thanking Prith for his service and in supporting Chandrakant with his new responsibilities.

Best,

Meg

More on this as it develops.




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