Hewlett-Packard is gunning for IBM in its bid to be the number one technology firm

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Hewlett-Packard is gunning for IBM in its bid to be the number one technology firm

Interview:  Hardware power can be unlocked by using grid computing, says HP chief.

It has been almost a year since the merger between Hewlett-Packard and Compaq. Steve Gill, UK managing director at HP is confident the company will deliver on its three- year product roadmap and strategy to be the number one technology firm. Its target is IBM.

"Before the IBM/PricewaterhouseCoopers merger HP was number one in the UK," said Gill. "In Europe, the Middle East and Africa, we are 20% bigger than IBM."

HP's ability to take on IBM was recently highlighted when it beat the outsourcing establishment, namely IBM and EDS, to a £1.9 bn 10-year IT infrastructure and outsourcing deal with Procter & Gamble. The contract took many industry watchers by surprise and represents a significant feather in the cap of the services division that HP built from the Compaq takeover last year.

Gill is clearly delighted to have won this significant global contract and said he is looking forward to working in partnership with Procter & Gamble. "We are confident we will deliver an extraordinary customer experience and the best return on IT for Procter & Gamble," he said.

Gill said the Procter & Gamble contract represents a significant step towards achieving HP's objective of becoming the number one technology business in the world. He said HP equipment is being used in the biggest stock exchanges and two-thirds of the world's cash machines, which run on HP's Non-Stop architecture.

But with such a diverse range of products, from the iPaq to the Superdome, from the Himalaya Non-Stop to Storageworks enterprise storage and Openview systems management tools, is there any sense of commonality at HP?

Gill does have a strategy and there are no surprises about the main focus of the company. The common threads linking the disparate product families together are: demonstratable return on investment, a competitive cost structure and the best customer experience.

The battle at HP is to provide a mix of open systems and high-end computers, which by their nature are proprietary. But Gill is clear on one point,"Itanium is core."

Intel's 64-bit processor family will form the basis of the company's server strategy. In terms of backing an operating system, Gill is hedging his bets with the three main contenders: Linux, Windows and HP-UX.

Tomorrow (23 April), HP will be joining the jamboree for the launch of Windows 2003. A new operating system drives demand for new servers so Gill is looking forward to the launch. "Our strategy is to support Windows 2003," he said. "We are participating in the launch. It is an opportunity."

Undoubtedly, the high-end Superdome, configured with 64-bit Intel chips, will push the performance envelope of Wintel even further. But, at the time of writing, Gill was not being drawn on any details about the launch.

However, he was more forthcoming on how HP will be tackling the return on investment argument. Armed with the latest industry buzzwords, Gill said, "The best way to deliver real ROI is through server virtualisation and grid computing."

In his experience most data centres only use between 20% and 40% of their IT capacity. To increase IT utilisation, Gill said, "Most big organisations need to move to the holy grail of utility computing." But this requires a radical rethink in the way the datacentre is constructed. "We are advising people to simplify their IT set-up. But this may not be realistic in the short term," he said. "People cannot afford to rip out all their existing systems."

By starting out on a grid computing strategy for the datacentre Gill believes businesses will see significant improvement of their IT in terms of greater utilisation without the need for heavy investment. On 30 April at its Bristol research laboratory, HP will be demonstrating how it uses grid computing within its own networks.

With the Compaq takeover, HP gained the world-beating iPaq personal digital assistant. Mobile computing, particularly in smaller businesses, is now a primary focus within HP. Gill said, "Mobile technology has been around for a while but people have not understood how to pull it all together."

He said HP is working with Microsoft, Orange and Vodafone in what amounts to a packages service for smaller businesses. "The cost [of mobile technology] to a small business is £1 per day per user," he said, "And this can improve productivity by between 15% and 30%."

Gill said HP would provide the handheld computers and servers; Microsoft would provide Outlook access; and Orange and Vodafone would provide the network. "We are looking at potential vertical markets," he said.

The problem for smaller businesses is that they lack the IT infrastructure to support mobility, said Gill. HP will be looking to offer a constant network connection to the office and a printer that fits in the boot of a car to allow mobile staff to print out hard copies. Users will be able to connect a portable projector directly to their PDA to run Powerpoint presentations when visiting prospective clients.

With regards to deploying mobile technology in larger businesses, Gill's advice to IT directors is to examine how service engineers or a mobile salesforce can make use of the technology.

The merger with Compaq has given HP a boost in IT services, mobile computing and the industry-standard Intel server market. Its relationship with Intel as a co-developer of the Itanium 64-bit chip has paved the way to the launch later this week of Windows 2003, 64-bit Edition, the first truly mainstream 64-bit operating system for Itanium.

And, if the Procter & Gamble deal is anything to go by, HP is set to become a major contender in large outsourcing contracts. Gill is confident the company can win over IBM.

CV: Stephen Gill 

Stephen Gill is the overall country general manager at Hewlett-Packard in the UK. He is responsible for developing HP's enterprise products and solutions, services, personal systems, and printing and imaging business in the major corporate and enterprise accounts in the UK and Ireland. 

Previously, Gill was vice-president and chief financial officer of Compaq for Europe, the Middle East and Africa, which accounted for about 40% of Compaq's worldwide revenues. 

He has 25 years' business experience, of which the past 18 have been in the IT industry. Gill joined Compaq as regional chief financial officer in October 2000 and has led major organisational change for Europe, the Middle East and Africa, significantly reducing operating expenses and channel inventories. He led the systems changes for the euro currency introduction, implemented financial shared services, and a revised European tax structure. He has also taken responsibility as overall regional general manager at various times during periods of organisational change and transition. 

From 1995 to 2000, Gill was senior vice-president and chief financial officer of Ingram Micro in Europe where he led the acquisition and integration of Macrotron in Germany. Before Ingram Micro, Gill held senior international management positions with Lotus Development and senior UK management positions with Digital Equipment and Sony.  

Gill qualified as an accountant with PricewaterhouseCoopers, London, in 1981 and holds a degree in mathematics from the University of Surrey in the UK.

Procter & Gamble's mega deal >>


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This was first published in April 2003

 

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