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HP Needs a Cogent Strategy: Fiorina

PALO ALTO, Calif. ( TheStreet) -- Embattled HP (HPQ - Get Report), which recently made a dramatic CEO reshuffle, needs a coherent strategy, according to the company's outspoken former chief Carly Fiorina.

"I think what the company needs right now is a cogent strategy that's clearly communicated, executed well over time and supported by the board," she explained, during an interview with CNBC before market open. "Leadership is always critically important."

Former HP CEO Carly Fiorina says that the company needs a cogent strategy.

Last week, HP's board ousted CEO Leo Apotheker after barely a year on the job, replacing him with former eBay (EBAY - Get Report) boss Meg Whitman. Unpopular with investors, Apotheker had struggled to communicate his strategic vision for the underperforming tech giant, particularly a controversial plan that could see HP spin off its vast PC business.

Whitman's appointment, however, was not universally lauded, with critics questioning her credentials for running a company of HP's size and complexity. Big questions have also been asked about the effectiveness of the hardware giant's board during a turbulent period in the company's history.

Fiorina, however, described Whitman and Ray Lane, executive chairman of the company's board, as effective leaders. 'Meg is a fine executive, Ray Lane is a fine executive," she said. "I think that they are going to be a very strong team."

The one-time HP chief nonetheless acknowledged that there is plenty of work to do. "It will take time to build trust with employees, customers, and shareholders," she said.

Fiorina was ousted from HP in 2005 over differences in strategy with the company's board, but remains a keen observer of the tech giant. Last month, for example, she urged HP to reinvest in innovation, and also backed the company's shift toward high-margin areas such as software and services.

On Tuesday, though, Fiorina, said that she would not spin off HP's $40 billion Personal Systems Group (PSG). "HP has one of the largest distribution channels in the world," she said, nodding to PCs as a potential launch pad for selling additional products and services.

Fiorina will also be keeping an eye on how HP integrates U.K. software maker Autonomy (AU - Get Report). "Is the right strategy in place?" she added. "I think that a cogent strategy means that everybody knows what it is."

"I own a lot of HP stock today; I have a financial interest in them doing well," said Fiorina. "I haven't sold the stock."

HP acknowledged Fiorina's call for a cogent, clearly communicated, well executed strategy. "We totally agree and that's what we are intending to do," explained a spokesman, in an email to TheStreet

HP shares, which have plummeted more 43% this year, climbed 5.02% on Tuesday, mirroring a major uptick in tech stocks.

--Written by James Rogers in New York

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