Sunday, April 13, 2008

The Ethics of Silicon Valley leaders

Larry Ellison managed to reduce his tax bill by $3 Million last month, arguing with the County Assessor that his $170 Million (cost) Japanese replica home wouldn't be worth more than $70 Million in resale value. Woodside schools and fire/police protection services are the losers, although in this rarified community, the tax base is sufficiently high, and the student population for the gentry who inhabit the community low enough that one suspects that somehow things will work out even with this penurious attitude by the tenth richest American, reputedly worth $14 Billion.

Meanwhile, over at the Los Altos Museum, Lucile Packard's scrapbook is on display, with a remarkable sequence of three letters from November and December 1963. The first, from HP's attorney, said that the assessor had advised that they could probably qualify for a very large tax reduction with the Williamson Act agricultural exemption for their new 33 acre Los Altos Hills property. The second, from Dave Packard, said "we won't file for that, since most of the taxes go to local schools, and we want to carry our fair share of the load". The third, from the attorney, reported that when he talked to the county assessor, the response was "well, THAT makes my day!" thus beating Clint Eastwood to the words.

Packard, like Ellison, made the Top Ten list for richest Americans. But they differed greatly in their view of who helped them get there, and what they owe their fellow citizens, employees, and community. Silicon Valley is fortunate for the David Packard example. No community can take much pride in the other approach.

9 comments:

Douglas said...

Thank you Chuck for sharing this. I've admired your writing beginning way back as a young HP engineer reading about state machines. Looking forward to your book. -- Douglas

dave davison said...

Your contrast of the ethics of Larry Ellison and David and Lucile Packard underscores the giant difference in the exemplary committment to community that was the essence of the Packard's ethical character and the legendary selfishness and self-promotion that has been the hallmark of Larry Ellison's "leadership" model.

By connecting stories like this in your blog about the HP Phenomenon you can expand the reach and depth of much of the content that may fall on the cutting room floor as you edit for the soon to be published book.

This blog can be your connection to your audience for the book and for your speaking engagements, and should be viewed as an integrated part of your stories about the remarkable company that is HP.

chuck said...

Wow... State Machines, THAT takes me back! That was one of those paradigm shifts, moving from asynchronous gate logic to synchronous logic, which shifted not only from oscilloscope testing and Logic Timing Analyzers, but required Logic State Analyzers, something that Biomation never got, and Tektronix struggled with.

The Ethics question posed here is in essence a Paradigm shift also. It is remarkable just how committed to the community and the employees Dave and Bill were; hard for many of today's folk to imagine

Marstein said...

So how do Carly and Hurd fare? Anyone look at their property tax?

chuck said...

great question...

Joe said...

Interesting comparison of a past HP leader and the current Oracle leader. What makes it even more interesting is that Mark Hurd and team are trying to rebuild the HP sales force in the same vein as the Oracle sales force. You can see proof of this by the ex-Oracle dominated sales leadership that has come on board in the last year.

So far this has not been very successful, and the new "pressure to close" sales model has cost HP customer facing employees, and customer loyalty.

Makes you long for David Packard.

chuck said...

Oil and water = Oracle & HP? Does make you wonder. Certainly there is a coonsistent sub-culture that runs through the RDBMS world in my experience that is counter to the purported HP history. On the other hand, the "Old HP" viewed HP Cupertino as aliens from outer space or Huns from the East

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