Hewlett-Packard Co.

Hewlett-Packard Co.

• Founders: Bill Hewlett and David Packard.
• Distinction: Leader in technology, and the business world that produces it.
• Primary products: Computers, printing and imaging products, related services.
• Annual sales: $42.370 billion.
• Number of employees: 84,400.
• Major competitors: Compaq, IBM, Xerox.
• Chairman, CEO and President: Carleton S. “Carly” Fiorina.
• Headquarters: Palo Alto, Calif.
• Year founded: 1939.
• Web site: www.hp.com.

As the 21st century approached, the Hewlett-Packard Company faced a significant dilemma. Justifiably acknowledged as Silicon Valley’s original startup, it literally began in a garage and unequivocally grew into one of the world’s top computer companies. Ever since its audio oscillator was picked up by Walt Disney Studios in 1939 for use in the original Fantasia, HP had consistently produced state-of-the-art electronic gear that was the envy of its industry. From that first product through calculators, computers, printers and imaging peripherals, Hewlett-Packard was always one to watch.
In addition, the company was always a great place to work. Its founders pioneered the concept of Management By Walking Around, which encouraged leaders to stay in close touch with their employees. It eschewed time clocks and offered flexible work schedules. It was one of the first large American firms to decentralize its operations and empower its workers. It provided a superior salary-and-benefits package. It even institutionalized these and other components of its vaunted corporate culture through adoption of The HP Way, an official document that stresses trust and openness. About the only criticism ever leveled at HP, in fact, concerned the historical lack of women in the ranks of its upper management.
As the company prepared to usher in the new century, however, all this was no longer adequate. Its once-experimental corporate structure was proving an ill fit for the networked age. Quaint habits—like an odd 87-hour pay period that was implemented decades ago for a type of worker HP no longer employs—were causing unnecessary headaches. Innovations in software and other key areas often went unnoticed by the public (as well as by many members of the all-important investment community). Competitors were surging. Internet activity was lagging.

And so, in mid-1999, Hewlett-Packard broke the mold once more by naming Carleton S. “Carly” Fiorina as its president and CEO. The first woman ever to lead one of the companies that comprise the Dow Jones Industrial average—and the first outsider ever to lead HP—the 45-year-old veteran of AT&T spinoff, Lucent, immediately embarked on a massive corporate overhaul. “We decided to transform this company,” she explained. Fiorina’s subsequent actions certainly stunned some tradition-bound observers. Others—including many employees, customers, and investors—were more positively impressed.