Comments on: Why European startups should be furious about Autonomy

By: Drew

Drew — Sun, 02 Dec 2012 03:45:29 +0000

Like I’ve said before – Meg has been sleeping at the (finance) wheel since she started. While Autonomy and EDS were erupting in flames, she never bothered to start from square-one, and look at P&L, nor the way her company was being run. From the beginning of her tenure, uncontrolled EDS costs were completely overtaking revenue, and internal infighting and bad process were ruining the Autonomy business. Somehow though, she was not interested. Like her other cohorts (including disgraced former Svcs Exec Visentin – among many others) this ‘Mgmt Team envisioned their role’ was to jump on the many HP Corp Jets (plural), and travel to exotic locations giving meanlingless keynotes on the greatness of HP crap. They also needed ‘ to meet with the rank/file’ – aka: more Corp boondoggles (see Visentin’s full-time interest in travelling on HPs dime to Formula One venues around the globe). This misbehaving went all the way down to the mid-mgmt and line-mgmt ranks – of course costing shareholder’s additional millions. From the outset of Whitman’s reign, it appears no one has ever seemed to be interested in gaining control of escalating employee costs, eliminating the anarchy in the divisions, nor understanding HPs basic core finances. HP Mgmt is the reason EDS and Autonomy disintegrated.

By: GL

GL — Mon, 26 Nov 2012 19:50:21 +0000

The whole world except HP’s management & board knew Autonomy was a bad buy a year ago.

By: Thomas Struan

Thomas Struan — Mon, 26 Nov 2012 15:25:16 +0000

I think this whole deal doesn’t pass the smell test. Having worked for an accountancy Giant like KPMG, I can tell you that the due diligence on this would have been extensive. I think Meg Whitman is a great businesswoman, and I have great respect for her on a number of levels, but I truly believe that she’s done this to lower expectations at HP in terms of her performance.

I am going to forecast that, at the end of the day, this is just posturing on the part of HP and that no wrongdoing will be found. In the years after Enron, no big auditing firm is going to put their entire future on the line just to beef up the books of one of its clients. So, I doubt that HP’s claims are valid.

As far as the context of this article – it is likely spot on. Deals across the pond are likely to be stymied as a result – but the real visionaries will still seek them out. Remember, Autonomy is a VERY TOP NOTCH PRODUCT and it is used by governments and businesses across the globe. Just because the juggernaut at HP failed to take advantage of it, doesn’t mean it was a bad deal.

By: Eran Goldfinger

Eran Goldfinger — Mon, 26 Nov 2012 15:02:32 +0000

How many of these deals are PUSHED by third party advisory groups with huge commissions hanging on closing these deals? There must be an “it’s now or never” type ultimatum put to boards for so many to pay so much. Even so, 8 billion? Wow! Didn’t they learn from Microsoft’s purchase of Aquantive? A billion here, a billion there, pretty soon it starts to add up and you can’t just hide those numbers in the Suspense/Miscellaneous/Staff Amenities/Staff Refreshments accounts. Finally, the reasons I stopped buying HP include being unable to recoup losses in a damaged HP laptop even with expensive insurance, (exact opposite to Apple’s respect for customers) their printers take forever to boot up and they refuse to print in black if a COLOUR cartridge is running low but the black cartridge is brand new!

By: Alvin Ernest

Alvin Ernest — Mon, 26 Nov 2012 12:20:07 +0000

The strategic value of a start-up is deeply routed in the collective vision of the start-up team… it is at best naive for M&A managers to ignore that fact… in valuing an acquisition, it is important that its value is considered in relation to the continuance of the team… of course, if the strategic intent is simply to derail competition then their “continuance” is not critical, but where M&A is regarded as a source of strategic growth then their “continuance” is crucial… Moreover, the Autonmoy, Skype cases prove that it due diligence should focus more on the “future” then the past… the past is easy to assess even for the “Big 5″ consultancies…. what is clearly evident is that the “Big 5″ have no clue how to value model or value market futures… theirs is as wild a guess as any… I believe that these cases highlight the need for the executives teams to do what they are paid to do… to develop, articulate and execute strategic intent…

By: Tony Hasek

Tony Hasek — Mon, 26 Nov 2012 10:49:12 +0000

Yeah…you’re right….wait? What? No. I dont’ think it’s fair, or wise, to judge the entire history of tans-atlantic tech M&A based on the poor due diligence and decision making of a few CEO’s. There have been many successful and mutually beneficial deals that can be seen as financial coups for US investors. or ‘win-win’ deals.
What I believe the real issue to be is that too much is expected of turnaround CEO’s – and under pressure the big bang, hail Mary acquisition can seem like a quick path to placate shareholders.

By: rtrinca

rtrinca — Mon, 26 Nov 2012 10:29:11 +0000

I often wonder how these over educated people can make such poor decisions. I guess you can’t teach common sense.

By: Chandresh Adhiya

Chandresh Adhiya — Mon, 26 Nov 2012 10:06:26 +0000

Bigger Companies fail to take correct decisions because of lack of controls on quality of decision making….Every small decision making is very important for success of company and there are no metrics today to capture the quality of decision making of individuals…..I am not saying that the decisions should never be taken on gut feel, however we need to know whose gut should we trust !
No management practices today moves beyond tracking MIS without really tracking Quality of Decision Making at each layer of organization….
Strategic decisions going wrong are visible to world, however there may be numerous decisions going wrong at Tactical and Operational levels as well….
Big problem with strategic decisions is that we can come to know if the decision was right or wrong only after results….

By: Caroline Clarke

Caroline Clarke — Mon, 26 Nov 2012 09:32:09 +0000

Salutations
Transparency, not to dilute the system, fit for purpose – that subject to verification it would be checked off even as a preliminary on audits – what growth were they looking to achieve here – organic from……… diversification from…………… it is important that all the ingredients are appreciated – if you going to market then the market must be identified with what is the recipe you are delivering it’s interesting that tech taking over tech would not appreciate how best to develop synergy – that flavours are appreciated too for their uniqueness. I would go so far as to say and with the greatest respect this piece would lend itself to assessing further, to say, any limitations in the space of management does not necessarily apply in all – such an assertion would not be kind.
Kind regards
Caroline

By: Philippe Jeudy

Philippe Jeudy — Mon, 26 Nov 2012 06:45:36 +0000

The story of value creation fail after a company has been bought by another one is not a European vs Silicon Valley privilege. It’s a usual disease on the way business is conducted in this kind of operations, unfortunately. In Europe and everywhere else.