The editorial page of this morning’s Merc had an interesting business/political tidbit: a glowing testimonial to former HP CEO Carly Fiorina from former Intel CEO Craig Barrett. The dead tree headline was
Fiorina was architect of Hewlett-Packard’s successwhile the online version says “History straightens out facts: Carly Fiorina positioned HP for success.” A few excerpts:
Under Carly Fiorina, Hewlett-Packard recognized that the computer industry needed consolidation and engineered the largest high-tech merger in history, combining HP and Compaq. There were plenty of skeptics to the bold actions taken by HP. But history has a way of straightening out the facts and the noted opinions of outside experts.As one of those skeptical “outside experts,” I’ve freely admitted that Carly was right and I was wrong. Barrett’s comments also fit what current HP employees say about her role in setting up the implementation being overseen by Mark Hurd.
Carly Fiorina, the architect of the HP-Compaq merger and now a candidate for U.S. Senate, deserves great credit for her actions while CEO of HP. She understood the challenges of the marketplace, the dangers of the status quo, and the need for companies to move forward with bold actions to ensure their success.
As CEO of Intel at the time, I remember watching those plans unfold with more than casual interest, as HP and Compaq were two of Intel's largest customers. It was a ringside seat to an industry-changing event. It wasn't always pretty, but it was carefully planned and well-executed, and the bottom-line result was exactly on target.
Barrett concludes with a political defense of Fiorina, in (futile) hopes of inoculating her against the mud that Barbara Boxer allies will dredge up if she survives the primary.
In the current political campaign, many accusations have been leveled against her and her tenure at HP. As someone who knows the industry well and was there watching all the details, I have to respectfully disagree.I found the column remarkable, because normally Intel CEOs have commented on things important to Intel, not its customers or partners. Apparently Barrett got to know Fiorina well during their overlapping tenures: Fiorina was HP CEO from 1999-2005, while Barrett was Intel CEO from 1998-2005, succeeding Andy Grove.
Carly Fiorina, who started her career as a receptionist and rose to be the first woman to run a Fortune 20 company, tackled the most difficult issues and brought exactly the right approach to a company that would have faced a more uncertain future otherwise.
While Barrett is entitled to his opinion, I would take issue with one claim: “HP has always been and still is an innovative company bringing great products into the market.” The New HP (both Fiorina and Hurd) is about cost-cutting, including cutting materials costs (ala Toyota) in hopes of reducing costs without noticeably reducing quality.
News headlines also implied that Hurd cut the HP Labs from 700 employees in 2005 to 500 employees in 2009. This makes sense if (as I concluded in February), Fiorina-Hurd decided that HP’s future lay as an efficient commodity IT producer rather than a high margin differentiated one — but it’s hard to argue that HP is as innovative as it was 20 years ago.