Oldtimers think Carly is when HP went over the cliff -- and certainly her Public Relations engine was in overdrive. But most folk we talk to think she started the corporate raiding of the till. The Proxy Statements on file show a different story.
There are two meaningful comparison sets of years. 2000 was the height of the dot.com boom; 2001 the bottom. 2008 (before the Lehman collapse) was the "best year", 2009 a disaster. I left out imputed stock option values, since those are remarkably hard to understand, thanks to your Federal Government's arcane FASB rules. I figured CASH PAID OUT is a good comparable.
In the 'good year comparison', Hurd and team made 700%, 266%, 1790%, and 1920% more money for CEO, CFO, PC Chief, and Services Chief than the Fiorina team. The next year for each, all took 'cuts' on both teams -- but for 2009, Hurd and team made 1400%, 368%, 970% and 1011% more than the comparable Fiorina team. The employees didn't fare nearly as well.
The Board did better too, averaging 320% more in 2009 per director than in 2001. Each full-time director, for a few meetings per year, made on average $328,000. Pretty good hourly rate.
To the best that I can figure, Mark Hurd's severance pay, for a "profound lack of judgment" that caused IMMEDIATE RESIGNATION, exceeded John Young's lifetime earnings. Young, CEO for fourteen years, gave 32 years to HP, and never had, so far as we know, any sexual harassment suits filed against him. He grew the company by a factor of sixty from his first organizational impact time until he retired WITHOUT ACQUISITIONS of consequence; Hurd grew it by a factor of 1.4, buying all of the growth in acquisitions, and the amount that he added in profit was less than the amount of R and D that he took away. The amount of debt that he added, to a company that never had any, is hard to calculate on a percentage basis.
But he did take away something akin to $150 Million in personal earnings (what some of the current HP employees have called "theft") in the past three years. WHEW. What has this Board been doing? What IS this Board doing?
Thursday, August 12, 2010
Wednesday, August 11, 2010
Who is writing this blog?
From a blog posting June 1,2009 by Joel Birnbaum, long-time R&D leader for HP, and definer of the HP/PA computing program, commenting about Chuck House and the new book by him and his co-author Ray Price:
"When I came to HP as a rare outsider hired into a high position, many people advised me to look up Chuck as someone who really understood the soul of the company. He was famous within HP for his wit, his creativity, and his willingness to speak out against things that he thought short-sighted or self-serving. I found that he more than deserved his reputation.
"His soon to be published book (The HP Phenomenon: Innovation and Business Transformation, Stanford Press, 2009), for which I was interviewed extensively, is likely to find wide acceptance and is a marvel of careful research and writing.
"Chuck is a witty, daring and very effective speaker, and during our time together at HP, he lent his name to many causes that resulted in dramatic improvements... not always with the prior approval of upper management. HP was eventually proud of these sometimes irreverent accomplishments, and many found their way into the literature and are in wide use in the industry today.
"For all of his career, Chuck's signature style has been his refusal to accept the status quo for purely historical reasons, and to think creatively and deeply about a problem or opportunity and then, often with recruited partners, to seek a novel solution. Chuck's style, while often flamboyant to attract attention to his causes, is inherently a modest one.
"When I came to HP as a rare outsider hired into a high position, many people advised me to look up Chuck as someone who really understood the soul of the company. He was famous within HP for his wit, his creativity, and his willingness to speak out against things that he thought short-sighted or self-serving. I found that he more than deserved his reputation.
"His soon to be published book (The HP Phenomenon: Innovation and Business Transformation, Stanford Press, 2009), for which I was interviewed extensively, is likely to find wide acceptance and is a marvel of careful research and writing.
"Chuck is a witty, daring and very effective speaker, and during our time together at HP, he lent his name to many causes that resulted in dramatic improvements... not always with the prior approval of upper management. HP was eventually proud of these sometimes irreverent accomplishments, and many found their way into the literature and are in wide use in the industry today.
"For all of his career, Chuck's signature style has been his refusal to accept the status quo for purely historical reasons, and to think creatively and deeply about a problem or opportunity and then, often with recruited partners, to seek a novel solution. Chuck's style, while often flamboyant to attract attention to his causes, is inherently a modest one.
what were you saying a year ago?
From this blog on December 13, 2009
"Dave Iverson (of KQED and NPR) moderated the CHM (Computer History Museum) event, very ably, and the questions were good ones. One in particular had to do with the current 'regime' and pay practices. Tough one to answer, and my answer "unconscionable if true" for the reported $113 Million for the four top people caused a murmur. I did say, 'Bill and Dave, for their egalitarian company, would find that an unusual pay practice'." The CHM video of this event is still available; these comments occur at about minute 60.
From this blog on Sept 2, 2009
"Hewlett and Packard have had multiple occasions to turn over in those cold graves -- the selloff of Little Basin and the merger/acquisition mania pale alongside pretexting, forfeiture of long-promised benefits, and rules banning executive participation on civic boards. Ethics and a huge belief in the dignity and value and worth of all employees were cardinal elements, weren't they?"
And from August 17, 2009
Five long-term HP employees (144 years between them), including two current VPs and one ex-EVP, commented: "the image of HP being the leading corporate citizen in the community, long a cherished hallmark of the company, has dried up in the current regime. Carly, they averred, was as strong on that as Lew or even Dave himself; not so under Hurd.... {At a key STEM (Science, Technology, Education, and Math) meeting for America recently, leaders} were outspoken about HP absentee-ism on topics of science and math education in America. They were outspoken... that HP only cares about sales, and ties 'corporate giving' only to 'deals' at best these days."
"Moreover, the considered opinion was that nine of the top ten high-tech firms in America (recall that HP is now the largest) have their CEO or Chairman or both involved enough in STEM education to be carried on the front pages of the Wall Street Journal while HP stands aside. What the hell has gone wrong at this place? Is the new guy in touch with anything besides the bottom line?"
"Dave Iverson (of KQED and NPR) moderated the CHM (Computer History Museum) event, very ably, and the questions were good ones. One in particular had to do with the current 'regime' and pay practices. Tough one to answer, and my answer "unconscionable if true" for the reported $113 Million for the four top people caused a murmur. I did say, 'Bill and Dave, for their egalitarian company, would find that an unusual pay practice'." The CHM video of this event is still available; these comments occur at about minute 60.
From this blog on Sept 2, 2009
"Hewlett and Packard have had multiple occasions to turn over in those cold graves -- the selloff of Little Basin and the merger/acquisition mania pale alongside pretexting, forfeiture of long-promised benefits, and rules banning executive participation on civic boards. Ethics and a huge belief in the dignity and value and worth of all employees were cardinal elements, weren't they?"
And from August 17, 2009
Five long-term HP employees (144 years between them), including two current VPs and one ex-EVP, commented: "the image of HP being the leading corporate citizen in the community, long a cherished hallmark of the company, has dried up in the current regime. Carly, they averred, was as strong on that as Lew or even Dave himself; not so under Hurd.... {At a key STEM (Science, Technology, Education, and Math) meeting for America recently, leaders} were outspoken about HP absentee-ism on topics of science and math education in America. They were outspoken... that HP only cares about sales, and ties 'corporate giving' only to 'deals' at best these days."
"Moreover, the considered opinion was that nine of the top ten high-tech firms in America (recall that HP is now the largest) have their CEO or Chairman or both involved enough in STEM education to be carried on the front pages of the Wall Street Journal while HP stands aside. What the hell has gone wrong at this place? Is the new guy in touch with anything besides the bottom line?"
Tuesday, August 10, 2010
Larry Ellison shows his colors
Mark Hurd's "close friend" Larry Ellison weighed in yesterday, to say the HP BOARD just made the biggest mistake in history for HP shareholders, as big as the idiots who removed Steve Jobs at Apple twenty-five years ago.
Surprise! This is the 4th richest guy in the world (Forbes, January 2010) who brazenly took $3 million away from the Portola Valley school district in 2008, while spending nearly a billion on his boat. Might makes right! Begins to give you a sense of why The Robber Barons were called that a century ago.
And Larry says no CEO fills out their own expense reports, so that must be a trumped up charge. Right! His minions tried to cover up the (non-sexual) dalliances? And he ... umm... voluntarily agreed that maybe he should resign?
Surprise! This is the 4th richest guy in the world (Forbes, January 2010) who brazenly took $3 million away from the Portola Valley school district in 2008, while spending nearly a billion on his boat. Might makes right! Begins to give you a sense of why The Robber Barons were called that a century ago.
And Larry says no CEO fills out their own expense reports, so that must be a trumped up charge. Right! His minions tried to cover up the (non-sexual) dalliances? And he ... umm... voluntarily agreed that maybe he should resign?
Check out Bianco's BIG LIE
Anthony Bianco had the perseverance to dig into the mountain of filed data re pretexting. He had the courage to write the book. He fingered Mark Hurd as "the guy", and in addition fingered him as "nailing Patti Dunn" (without violating the HP sexual conduct code) to take the fall for him.
My Amazon review of Bianco's book on June 13, 2010 (before Jodie Fisher sent her complaint to the HP Board June 29), says "where there's smoke, there's likely a fire. Unfortunately, from Tiger Woods and Enron and WorldCom leadership, to Lehman Brothers and other Wall Street "leaders"... we are getting accustomed to leaders being less than they seem. True at HP now?"
Howze that for calling the shot?
My Amazon review of Bianco's book on June 13, 2010 (before Jodie Fisher sent her complaint to the HP Board June 29), says "where there's smoke, there's likely a fire. Unfortunately, from Tiger Woods and Enron and WorldCom leadership, to Lehman Brothers and other Wall Street "leaders"... we are getting accustomed to leaders being less than they seem. True at HP now?"
Howze that for calling the shot?
Holy mackerel
The e-mails were flying fast between 2:07pm and 2:09pm last Friday afternoon. I arrived home from a visit to the Palo Alto Medical Foundation at 2:21pm, unaware that HP had just announced that Mark Hurd had just resigned. The e-mails were from a varied lot -- KGO/TV who had never ever tried to call me before; reporters for Business Week, CNBC, etc with whom I'd met once or twice in previous years; friends and colleagues from HP today and "the old HP".
Sexual harassment that didn't happen?
A few mis-stated expense reports, that "totalled" somewhere between $1,000 and $20,000? This turned out (missed by nearly all the columnists) to be for EACH ONE. The 2008 10K report says Hurd was re-imbursed $79,814 in tax "True-ups" for the estimated $243,000 in "personal meals" that he ate on behalf of HP. This was in the midst of the three years cited with "his girl friend" -- sounds like a little more money than the initial reports.
All bogus, in my view. This guy was a thug, nicknamed Mark Turd by ex-HPites who worked directly for him -- stories that have circulated in the Valley for three years. He raped HP employees (figuratively, without violating the sexual conduct code at HP) by eliminating the sixty-five year concept of profit sharing, preferring to move to obscene bonuses for himself and his five top minions -- a mere $113 million payout for them in a year he chopped everyone else's pay by 5% plus profit-sharing. These were raises for some of the five people by as much as 400% -- a tidy uptick.
He was profane, a bully, autocratic, threatening, demeaning, vindictive, and rude. Blogs over the weekend by current employees said "Hooray, the tyrant is gone!" I couldn't contain my glee on the 11pm news -- best news for HP in a very long time!
The Voice of the Workplace, HP's thirty-five year historic 'measure' of employee feelings (done every five years) showed in April an astonishing finding -- more than two-thirds of HP's employees would quit tomorrow if they had an equivalent job offer. Not a raise, not a promotion, simply an alternative. That number never used to be in double digits. Other companies in the Valley have reported an amazing rate of HP resumes being submitted; one large company saying, "we didn't know they had that many people working there".
There's lots more to "worry about", and it is easy to imagine that the HP Board was worrying about all of them, but didn't know where to "pin the blame". This "non-sexual" harassment was simply a convenient foil...
Sexual harassment that didn't happen?
A few mis-stated expense reports, that "totalled" somewhere between $1,000 and $20,000? This turned out (missed by nearly all the columnists) to be for EACH ONE. The 2008 10K report says Hurd was re-imbursed $79,814 in tax "True-ups" for the estimated $243,000 in "personal meals" that he ate on behalf of HP. This was in the midst of the three years cited with "his girl friend" -- sounds like a little more money than the initial reports.
All bogus, in my view. This guy was a thug, nicknamed Mark Turd by ex-HPites who worked directly for him -- stories that have circulated in the Valley for three years. He raped HP employees (figuratively, without violating the sexual conduct code at HP) by eliminating the sixty-five year concept of profit sharing, preferring to move to obscene bonuses for himself and his five top minions -- a mere $113 million payout for them in a year he chopped everyone else's pay by 5% plus profit-sharing. These were raises for some of the five people by as much as 400% -- a tidy uptick.
He was profane, a bully, autocratic, threatening, demeaning, vindictive, and rude. Blogs over the weekend by current employees said "Hooray, the tyrant is gone!" I couldn't contain my glee on the 11pm news -- best news for HP in a very long time!
The Voice of the Workplace, HP's thirty-five year historic 'measure' of employee feelings (done every five years) showed in April an astonishing finding -- more than two-thirds of HP's employees would quit tomorrow if they had an equivalent job offer. Not a raise, not a promotion, simply an alternative. That number never used to be in double digits. Other companies in the Valley have reported an amazing rate of HP resumes being submitted; one large company saying, "we didn't know they had that many people working there".
There's lots more to "worry about", and it is easy to imagine that the HP Board was worrying about all of them, but didn't know where to "pin the blame". This "non-sexual" harassment was simply a convenient foil...
Monday, July 12, 2010
disquieting input
Barry Katz, a consulting professor at Stanford's Design School, stopped by a few weeks ago, thrilled to find that we had included nearly ten pages about industrial and HCI design in our book. He is in process of doing a "definitive historic book" about ID and HCI in the Valley, and we chatted convivially for quite a while. Barry and I taught together in Stanford's VTSS program in the 1980s. I gave him a number of names worth following up with in the Valley, including the long time head of HP's Design Group, Allen Inhelder.
Imagine my surprise with an e-mail blast a few weeks later, from Allen (his P.S. note said his name is not spelt Alan, which we got wrong in the text p. 234, but right in the footnote, p. 577 -- embarrassing!). The bigger concern though was his message: "Your creative story telling about the history of HP Industrial Design is incorrect. Your writing also denigrates by omission an outstanding body of work that has never been duplicated. Your literary alchemy has managed to turn the HP golden years of industrial design into a mound of bullshit. It is obvious that you didn't bother to fact-check your sources. I am deciding how to tell the readers of your book the facts about the early days of industrial design in general and at HP."
Allen included his phone number, and I called him directly. His chief concern seemed to do with our crediting Carl Clement as heavily as we did for the "Clement Cabinet" which Allen feels he mostly designed, but politics meant that Carl was the chief name on the patent filing. We do credit Allen with the replacement cabinet, done fourteen years later -- he calls them System 1 and System 2, but really was clear that he, not Carl, was chiefly responsible for both. Couple this with the fact that we didn't acknowledge that Allen led the Corporate Design Group for nearly twenty-five years -- you can imagine that he was pretty worked up!
I doubt that the call placated Allen much, but it was very important to hear his point of view, and reflect on so many good things that he did do or did lead. We can patch some things in a later printing perhaps; meanwhile, he will have his story told more fully in Barry's definitive work.
Joel warned me about the likelihood that this will be a common kind of occurrence, based on what he has seen with other authors trying to give credits that are elusive sometimes to pin down. Ah, well... For those of you from the ID / HCI community, our apologies if we were inadequate here; our intent (by contrast with most computing and electronics company histories which ignore ID / HCI altogether), was to try to include it and give some context for its importance as a discipline in this crazy-quilt high-tech world
Imagine my surprise with an e-mail blast a few weeks later, from Allen (his P.S. note said his name is not spelt Alan, which we got wrong in the text p. 234, but right in the footnote, p. 577 -- embarrassing!). The bigger concern though was his message: "Your creative story telling about the history of HP Industrial Design is incorrect. Your writing also denigrates by omission an outstanding body of work that has never been duplicated. Your literary alchemy has managed to turn the HP golden years of industrial design into a mound of bullshit. It is obvious that you didn't bother to fact-check your sources. I am deciding how to tell the readers of your book the facts about the early days of industrial design in general and at HP."
Allen included his phone number, and I called him directly. His chief concern seemed to do with our crediting Carl Clement as heavily as we did for the "Clement Cabinet" which Allen feels he mostly designed, but politics meant that Carl was the chief name on the patent filing. We do credit Allen with the replacement cabinet, done fourteen years later -- he calls them System 1 and System 2, but really was clear that he, not Carl, was chiefly responsible for both. Couple this with the fact that we didn't acknowledge that Allen led the Corporate Design Group for nearly twenty-five years -- you can imagine that he was pretty worked up!
I doubt that the call placated Allen much, but it was very important to hear his point of view, and reflect on so many good things that he did do or did lead. We can patch some things in a later printing perhaps; meanwhile, he will have his story told more fully in Barry's definitive work.
Joel warned me about the likelihood that this will be a common kind of occurrence, based on what he has seen with other authors trying to give credits that are elusive sometimes to pin down. Ah, well... For those of you from the ID / HCI community, our apologies if we were inadequate here; our intent (by contrast with most computing and electronics company histories which ignore ID / HCI altogether), was to try to include it and give some context for its importance as a discipline in this crazy-quilt high-tech world
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