WSJ and Robert McMillan--new material, same worn-out untruths

Well written, but McMillan cites 'the facts' without considering the 'right dates':  "H-P’s stock price fell 55% on Ms. Fiorina’s watch, more than peers in the technology industry, even those hammered by the 2001 downturn. Dell Inc.’s stock dropped 5% over the same period; Cisco Systems Inc.’s fell 45%; IBM dropped 31%. The Nasdaq Composite Index fell by 27%.  Our numbers come up differently--I keep wondering "what was Carly's watch" when they write this.  We use (as described in earlier posts) her start date--June 19, 1999--and end date--February 7, 2005. for one set of calculations.  We use November 1, 1999 to October 31, 2005 as "her momentum play" as described herein also.   The third way--start her on November 1, 1999 (give Lew Platt the final 1999 quarter with the Agilent divestiture), and take it to either Feb 7 or Oct 31, 2005.  
       Doing that gives HP at -46%, and -24%; IBM at +1%, --12%; Cisco at -46%, and also -46%; and Dell +7%, -26%.  So, really depends on WHEN you date the numbers to.

Ms. Fiorina declined to be interviewed for this article. Her press secretary, Anna Epstein,said Ms. Fiorina’s tenure coincided with an economic downturn that hurt many companies: “As of Oct. 31, 2001—after the height of the dot-com bust—H-P had over 86,000 employees world-wide. Carly’s leadership saved H-P, and those jobs, during the worst technology recession in the last 25 years.”

Ms. Fiorina indeed saved jobs by keeping H-P afloat, but had to trim the company’s workforce by about 30,000. Dell, about a third the size of H-P in 2005, cut roughly 1,700 jobs during the same period, according to people familiar with the matter."  See the next blog post re Dell

McMillan did find Carly's immediate replacement, CFO Bob Wayman, who claimed--correctly in my view--that Carly's work paved the way for Hurd's success re Dell.  Left out of all of these discussions is the fact that Dell had to file for redemption with the Feds for falsifying their 2003 and 2004 sales and profit data--factoids that certainly helped keep their stock prices afloat, and rising faster than HP.   From news stories at the time: Dell said it would restate annual and quarterly results for its 2003, 2004, 2005 and 2006 fiscal years, as well as the first quarter of fiscal 2007. Dell said fiscal year 2003's first quarter, which ended in May 2002, and fiscal 2004's second quarter, ended in August 2003, would be hit hardest, with net income and earnings a share falling 10% to 13%.

Here's one response to McMillan's article (out of 232 the first day)" Jay Jeckyl

If you chart the growth of HP from the point months prior to her dismissal and the following next 2-3 years, you'll see what's called "setting the table".  She did for her replacement what Reagan and Bush did for Clinton.  They worked hard at "setting the table".  Her best work was after the BOD dismissed her and thus made a big mistake.  Look it over.  The numbers don't lie.

Steven Levy weighs in

Steven Levy, one of Silicon Valley's heavyweight authors and observers, had a trenchant article at:
https://medium.com/backchannel/how-steve-jobs-fleeced-carly-fiorina-79d1380663de

Titled "How Steve Jobs fleeced Carly," it tells the story of HP's abortive attempt to sell iPods and Jobs' glee in abetting the action.  This, more than the financial "Whadda think she did, didn't she kill HP with the Compaq deal?" tells a lot about both Carly and her style.

The style is what few have focused on to date.  Trump of course took on "the face' and CNN pundits took on "the lack of a smile" in the 2nd debate.  "Humorless" according to some; without empathy is the common theme, underscored by the sudden firing and 'marching people to the door' tactics.  Most CEOs are formidable, few are loved if we believe the Glass Door ratings, but very few have the employees break out in song when a dismissal occurs--and the song, "Ding, dong, the witch id dead" hardly gives one enthusiasm for a Fiorina presidency.

I for one have consistently viewed Fiorina's strategic skills as her greatest strength--she alone of the 'big six' (Barrett at Intel, Ballmer at Microsoft, Ellison at Oracle, Chambers at Cisco, McNealy at Sun) called the Dot.Com meltdown--weeks and months in fact before any of the others agreed.  Want dates and statements?  See HP Phenomenon, pp. 445-447; also pp. 422-23.  She was clear-eyed by comparison to virtually all of the other CEOs of the day.

What about Jobs, you ask?  Worth recalling that he'd led his company for five years at this point, while she was two years on the job.   Apple was down 50% in revenue--REVENUE--and profits had turned to ZERO.  Any thought of a resurgent Apple at that point was beyond implausible.  Amazing what a little time can do.

And indeed it was coming out of that dot.com meltdown that Jobs took Apple into music, of all things, and that is what Carly sought to piggyback with him, at a time she had dealer shelf space and he didn't.
Read Levy's article from that standpoint, and it explains her hubris a bit better.

Writers with things to say about Carly

The early commentators included Jeffrey Sonnenfeld from Yale, and xxxxx  xxxxxxx from the San Jose Mercury-News--both quite negative.



Then Julie Bort weighed in, for Business Insider on Sept 16.  She was less strident, but did say that "To be fair, her tenure overlapped with the end of the dot-com bubble, and a lot of tech companies had similar stock price drops during that period as well.  But HP's stock performance was worse than other big tech companies, such as Cisco, Intel, Microsoft, and Oracle, during her tenure."  

Well, my earlier post compared Intel and Microsoft to HP during this period, and it's hard to argue that any significant difference existed.  As for Cisco--well, during this period, the company was a total high-flier, becoming the most valued market cap company on the globe--not exactly a fair comparison for any other company, not just HP.
Oracle--well, that story is really a laugher--here's the chart (I don't think Bort did her homework)

Stephen Gambel for Fortune.com tried on Sept 22, and came up with this gem: " HP’s stock price significantly underperformed rivals during Fiorina’s time as CEO, and she was eventually fired in 2005, because the merger she pushed through with Compaq was considered a failure at the time. But on other measures like revenue and cash flow growth, HP under Fiorina seems to have done better—though still not that much better than rivals.      By 2003, HP had slumped to No. 2, trailing Dell. In her final full year at the company, Fiorina’s HP trailed Dell by almost two percentage points in the PC market.By the time Fiorina left HP, the company was not the “leader in every market segment, every product category.” It wasn’t actually even the leader in personal computers, which was at the heart of the acquisition of Compaq, and one of the company’s largest business segments.  

HP did eventually regain the lead in the PC market, but it didn’t happen until the final quarter of 2006, nearly two years after Fiorina had left HP. And even by then, it was starting to look like a Pyrrhic victory. The PC market, the one Fiorina was in part chasing with the merger with Compaq, was already becoming vastly less profitable than it used to be."

Setting aside Gambel's wrong comments about stock price "significantly underperforming rivals", this answer begs to have a Dell/HP comparison which I've not provided as yet.  Subsequent posts will do this--you might be quite surprised by the numbers.

The most illuminating article compared five of HP's CEO's with each other--from Lew Platt thru Meg Whitman.  See Carly Fiorina versus HP's other CEOs, in charts

Laura Mandaro, George Petras, Frank Pompa and Karl Gelles, USA TODAY 4:11 p.m. EDT September 22, 2015

This is an excellent article, pointing out that Carly was not the 'only dim bulb' running HP

It doesn't compare her time to contemporaries, but it does put HP's fortunes in clear view

Steve Rattner, in the New York Times Opinion Pages, wrote "Carly Fiorina really was that bad." again taking most of the same points, but going back and blaming her for Lucent's capsizing a year and a half later (and noting that she was never CEO).  What I liked best was a comment to Rattner's article by Tom of Fort Collins (who I am betting was a colleague of mine there).  Tom wrote: "

Tom

 Fort Collins, CO September 26, 2015

I worked at HP during Carly's tenure and was one of the few that survived her massive layoffs due to her Compaq acquisition. Her twisted recitation and spin of reality during her time at HP is frustrating.

A lot is written about the financial impact when she was there. Little is written about how her leadership destroyed HP's culture. Great technology made and delivered by fiercely loyal HP employees devolved into missed market opportunities and a demoralized, decimated employee base.

Like a stone thrown into a pond, the ripples from Carly's tenure continue their outward progression. Read any financial newspaper today about the turmoil at HP...company splitting, thousands being laid off...and you can draw a straight line backwards to Carly's time at HP.

This is the Carly story--the numbers being used are inappropriate, in most cases, but the story Tom tells could be told by countless thousands of HPites.

By far the most nuanced, and accurate, assessment in my view published in recent weeks is this Harvard Biz Review article: 

Carly Fiorina’s Legacy as CEO of Hewlett Packard

• Behnam Tabrizi

SEPTEMBER 25, 2015

Benham, as did I, spent much time during Carly's and Hurd's tenures interviewing folk within HP.  He reports a most convincing story that gets to some of Tom's points, some of those made in my book, and almost none of which gets credence from the Wall Street crowd.  Get it, and read it--he concludes that she isn't as good as she says, and nowhere near as bad as the jackels would have it.

Here's the link: https://hbr.org/2015/09/carly-fiorinas-legacy-as-ceo-of-hewlett-packard 

The polls and the pollsters--WHO IS SHE?

It surely must seem to many that this is indeed the silly season.  How otherwise can you explain Donald Trump, Carly Fiorina and Ben Carson doing so well in the Republican polls?

You can get any number you like, just about, for Carly Fiorina--someone virtually no one in middle America had heard of until a few weeks ago.  Here's the best she is purportedly now doing (in New Hampshire):

Over in Iowa, she's not faring as well, but she's still ahead of Bush, who's far better known:

I didn't know that they do polls of the pollsters--lessee now, can we average what the pundits think?

This is Carly's 'worst showing' -- apparently the professionals are pretty sure she's not all that good.   And indeed the staunch Republican drums are beating..."Let's get Marco, he's our only hope"

So, no wonder I'm getting occasional calls, and even have sold some of the HP Phenomenon books--who'd have thought this would become a political best-seller?   Stranger things have happened, but not really to me very often.

So, after the initial flurry of notes that I posted, somewhat in a huff about the way the pundits were treating 'our girl' and her TERRIBLE LEADERSHIP at HP, I kinda went silent to digest all of the press copy and perspective of just about every business rag and analyst alike.  

Maybe a recap would be in order....