HP Addresses Customer Concerns After Autonomy Write-Down

Evan Koblentz

Law Technology News

11-26-2012

Executives at Hewlett-Packard Co. began explaining in a conference call last week how the company intends to soothe worried customers after accusing former leaders of its Autonomy Corp. subsidiary of "accounting improprieties, misrepresentations and disclosure failures," prior to HP acquiring Autonomy last year for $11.1 billion.

HP CEO Meg Whitman, joined by HP's George Kadifa, executive vice president of software, and Robert Youngjohns, general manager of Autonomy, took questions about how HP will improve responsiveness for Autonomy customers and partners, how HP's due diligence did not find the alleged improprieties earlier, what immediate changes would be made, and how the scandal impacts product roadmaps.

Youngjohns, a former Microsoft executive who joined Palo Alto, Calif.-based HP in September, said that in four to six weeks from now Autonomy will begin using HP-derived key performance indicators to measure customer and partner satisfaction, in addition to performing annual customer surveys. Of partners, "I think that it's fair to say that Autonomy hasn't got a stellar record in terms of partner management, or using partners to get to market either in terms of reselling our [Autonomy] product or in providing the services that are required to implement our [Autonomy] products," he said.

Youngjohns also said he needs to work on keeping employees focused on customers, in addition to their own morale. "I think the former culture was more of a secret society, if you like, where there wasn't much openness and there wasn't much transparency," he noted.

Of the overall scandal, Whitman said that the "HP board feels terribly about this. We feel like we were deceived." "You never dream that you're going to have to do forensic accounting of a publicly held company, but if we're buying another publicly held company, I assure you that we will be doing that," she said.

Former Autonomy CEO Mike Lynch left in May as part of an HP-wide layoff of 27,000 people. Notable executives who remain at Autonomy include Neil Araujo, general manager of enterprise content management; Galina Datskovsky, senior vice president of information governance; Fernando Lucini, lead technologist; and Rafiq Mohammadi, general manager for compliance and legal products.

On the product side, "In the backup, e-discovery, and archiving space, we're looking at the boundaries between those businesses because it's increasingly clear they're getting overlapped. What you might archive may become what you need to do e-discovery on next, and it would be great if we could do that from a single platform, and that's what we'll be working toward," Youngjohns said. Autonomy's software could stand fewer customization requirements upon installation, he added. Officials will expand on both plans at the HP annual user conference in Frankfurt, Germany, next month, he said.

Autonomy needs to simplify its product catalog and make its roadmap more predictable, Kadifa said. "This is something we intend to start sharing with our customers in the first half of next year," he continued. The company is also working toward services available through the public cloud, Youngjohns added. (Autonomy, based in Cambridge, England, and in San Francisco, is already known for its private cloud services.)

Recent product announcements from Autonomy focused on integrating the company's software with HP information governance applications, and also with HP hardware such as servers and printers. Integration with HP storage is expected to be announced next week.

Evan Koblentz is a reporter for Law Technology News. Send email or follow him on Twitter.