Little did he know that he would soon be presiding over another ugly CEO transition and drawing withering criticism for what investors and analysts viewed as incompetence on the part of the HP board.
Now, as executive chairman, the respected Silicon Valley veteran and Kleiner Perkins Caufield & Byers venture capitalist has his reputation on the line as he tries to get the iconic computer maker back on track.
While many of the events that have made HP a poster child for mismanagement and board dysfunction preceded Lane's arrival in November 2010, his year-long stint has had more than its share of drama.
Lane, 64, signed off on a nearly $11 billion acquisition of software maker Autonomy that was widely panned by investors, and he stood by while Apotheker spooked Wall Street by floating the possibility of a spin-off of the huge personal computer division. Lane quickly found himself the public spokesman for the controversial new strategy.
When it became clear that the CEO had lost his credibility, Lane and the board fired Apotheker in September, letting go a man he has known for 20 years.
At the same time, HP added executive to Lane's chairman title and, without a formal search, appointed board member and former eBay Inc chief Meg Whitman as CEO, despite her lack of experience in enterprise computing.
Lane stands by those decisions. It was hard with Leo, he told Reuters in an interview earlier this month. You have to have a consensus that it's the right move for the business. Once you do, you can't sit around on it, you've got to do it. You've got to be clear. That's what I do.
On Thursday, Lane added another member to HP's board, activist investor Ralph Whitworth whose firm Relational Investors bought a small stake in the company.
Conversations with current and former colleagues of Lane paint a picture of a plain-speaking and decisive executive who is not afraid to get his hands dirty.
When HP dismissed Apotheker, Lane minced no words in describing his associate's failings. On a conference call with Wall Street analysts, Lane said the former CEO did not dig deep into the business to understand its dynamics, could not execute operationally, missed Wall Street expectations for two straight quarters, and was poor at communicating strategy.
This is a board who objectively evaluated whether he was the right guy to operate the business. And we came to the conclusion he was not, Lane said at the time.
RIGHTING THE SHIP
Lane describes his role at HP as that of a consultant and is eager to dispel any notion that he is running operations. He had turned down HP when he was approached as a possible CEO candidate, after Hurd was ousted in August last year.
Nonetheless, Lane is clearly devoting a lot of his energy to the tech company. He said he meets with Whitman once a week, and they talk on the phone about three times a week.
I don't drive the software strategy at HP, Lane told Reuters. I can afford to give her some time. She knows that I know software and services.
The two tech veterans go way back to when Lane was at Oracle and helped Whitman solve a systems crash at eBay in 1999 that rendered the auctions site inaccessible for 22 hours.
Lane also supported Whitman, a Republican, in her unsuccessful run last year to become California's governor. She made it a condition of taking the CEO job that Lane spend time helping her, at least for a while, and she seeks his advice on anything from strategy to hiring of senior executives.
He has a gut feel for things and his gut is very experienced, Whitman told Reuters. He will basically say 'Listen, here's the three things that ought to be worked on'.
The duo have already decided to scrap the idea of spinning off HP's PC division, saying it did not make strategic or financial sense. Wall Street has given cautious approval - HP's stock has gained about 20 percent since Apotheker's exit, after losing nearly 44 percent in the 10 months of his tenure.
Criticism of the board has subsided for now, as investors give the new team some time to try to prove themselves.
We would like to see management make objective allocation of capital. Don't make any more dumb acquisitions. Don't overpay, said Don Yacktman, founder of Yacktman Asset Management Co in Austin, Texas, which oversees $11 billion and holds HP shares.
RISING THROUGH THE RANKS
Lane grew up in Pennsylvania and received a math degree from West Virginia University. He got his start in the corporate side of the computer business, working in sales and product management for IBM, then jumping to Ross Perot's EDS before building and running a technology unit for Booz Allen Hamilton.
His signature career achievement to date was helping to transform Oracle from a niche software company with $1 billion in revenue in 1992 to an industry powerhouse with $10 billion in revenue over the course of his eight-year tenure.
Lane was the calm, operations-oriented insider, a good complement to the mercurial CEO, Larry Ellison. Lane, who met his second wife Stephanie at Oracle, was chief operating officer when he left the company in 2000 after a falling out with Ellison, who is now one of HP's fiercest critics.
Lane resigned after Ellison became more involved in the day-to-day running of Oracle, eventually stripping Lane of most of his responsibilities. Ellison had at times stepped back from Oracle, but re-inserted himself with gusto in the late 1990s.
The last year I worked there, we did not hit it off, Lane said of Ellison. I resigned. Clearly he wanted me to go.
Oracle made Lane a very wealthy man, and he favors the fast cars, private jets, lavish accommodations - and hobbies such as hunting and scuba diving - that are common among successful Silicon Valley executives.
A few months after he left Oracle, Lane joined Kleiner Perkins in 2000 and is now a managing partner.
As a venture capitalist, Lane's overall record is hard to assess, due in part to his tendency to shy away from the consumer-Web startups that typically make the biggest impact with splashy initial public stock offerings.
Instead, Lane has sought out software and clean-energy companies. The handful of bets that have wound their way through his portfolio have tended to be acquired by other companies for undisclosed prices. They include solar company Ausra, which was sold to Areva last year, and software company Virsa, which SAP bought in 2006.
Lane has also had his share of disappointing investments, including software companies SpikeSource and MetaMatrix, which he said he sold for only a little more than what he paid.
He is long on electric cars, serving as lead investor and chairman of Fisker Automotive, whose electric Karmas start at $96,000. Lane paid for and drives the second Karma to roll off production lines. The first went to actor Leonardo DiCaprio, another investor in the company.
Lane says he relishes the car's silence but is still getting used to its novelty factor; when he drove to San Francisco last week to catch an opera performance with his wife, another driver on the highway kept trying to snap pictures of his car.
COMMITTED KLEINER VC
Business associates say Lane has a gift for the subtle but significant gesture. Andrew Perlman, chief executive of GreatPoint Energy, one of Lane's venture investments, recounts a meeting with a potential investor from China at Kleiner Perkins' offices in September.
Lane remembered the visitor's fondness for Napa Valley wine and, leaving a half-dozen executives in the room, he snuck out, sped the six miles home and returned with two prized bottles of a special edition cabernet called Emilio's Terrace from his own cellars. One bottle was shared right then and Perlman said the gesture cemented the relationship with the potential investor.
Fine wine also washed down the quail that Lane had hunted himself in Mexico and served Perlman on Super Bowl Sunday.
Perlman and other associates also describe a tougher edge to Lane, saying he often works more like a company operative than a venture capital advisor.
Sandy Kurtzig, founder of the software firm Kenandy, said she regularly turns to Lane for guidance, particularly in vetting potential staff. She recalls one applicant for a high-level position who came highly recommended, but who Lane interviewed and didn't think was the best fit.
According to Kurtzig, Lane told the applicant bluntly on the spot, You're not the right guy for the job. She added, It was a little awkward for me. She hired another candidate.
For Lane, such decisions are strictly business. He said one of the toughest involved Frank Varasano, former CEO of Lane's portfolio company Next. They had worked together at Booz Allen and again at Oracle. Varasano was let go following the car company's failure to win a critical government loan guarantee.
Typically, after those incidents, Lane said he reaches out to say, Let's not lose our relationship. About three-quarters of the time, he succeeds in restoring friendly ties, he said.
SHAKING UP THE BOARD
Lane, who starts his day with dawn exercises on the elliptical or abdominal crunches, said he enjoys his work with young companies too much to give it up to run a big corporation like HP. But he has agreed to devote more time to HP's board at this critical moment in its history.
His first order of business has been to shake up the board itself, which was angry and divided after Hurd was shown the door in the wake of a sexual harassment allegation; the board found that he had violated company expense policies in his relationship with an HP contractor.
Not all board members agreed with the abrupt way Hurd was let go. He was not universally admired but he was credited with turning around the company's financial performance.
When Lane arrived he consulted with every board member, and all of them volunteered to resign to aid the revamp. He accepted the resignation of four and then brought in five new directors, including billionaire Whitman and Patricia Russo, former CEO of Alcatel-Lucent.
The new board has a broader skill set, said HP director Marc Andreessen, the venture capitalist who co-founded Netscape, the Internet browser company.
He met Lane 15 years ago, when Oracle was considering buying Netscape and the two sides were negotiating over a table thrown together from construction horses and plywood at Lane's then-newly purchased and furniture-less hilltop home in the upscale Silicon Valley suburb of Atherton.
Their secret discussions did not bear fruit, but Lane still won Andreessen's respect. There are very few people in our industry who have run a company the size of Oracle. Of those people, I can't think of anyone else who have then become a successful venture capitalist, Andreessen said.
As Lane marked his one-year anniversary on HP's board on November 1, Wall Street seems to be hopeful that the ship is turning in the right direction though there was still a lot to be done to regain investor confidence.
He was around for a lot of issues that occurred during Leo's tenure. I don't think he's immune from that, said Morningstar analyst Michael Holt. It's still very early stages of this management duo. We won't know for a couple of quarters if the combination is working out.
But Lane is confident enough in his new CEO to predict that he will soon be dialing back his time at HP. He said he'll wait until Meg says, I'm good. I've got it.