One of Silicon Valley’s giants, Hewlett-Packard, had a moment in the spotlight at Wednesday night’s presidential debate. Carly Fiorina, a former chief executive of H.P., pointed to her role at the company — saying that she grew its overall size.
As Josh Barro writes, Mrs. Fiorina was able to greatly increase revenue during her time at H.P. Profit, however, was another matter. “Mrs. Fiorina’s strategy to quickly grow H.P.’s top line was to buy another large company, Compaq Computer. That deal was widely criticized at the time because it got H.P. a big increase in sales but little profit.”
The deal for Compaq, Steve Lohr wrote at the time, was meant to add Compaq’s huge PC business to H.P.’s highly profitable printer business. But it wasn’t loved by everyone close to the company. The debate over the deal inside the company “escalated into something personal, even vituperative” when Mrs. Fiorina faced off against Walter B. Hewlett, the son of an H.P. founder, who was against the deal.
Mrs. Fiorina won that battle, securing the biggest deal of her time at the company. But three years later, she was out as leader. John Markoff wrote when she was voted out about how the board had met on a Sunday at a hotel near O’Hare International Airport in Chicago. “While she was staying nearby, Ms. Fiorina was excluded from the discussions. On Monday, the board told her that they wanted her to resign,” leaving her stunned.
Mrs. Fiorina has said that she lost her job because of her maverick management style. Andrew Ross Sorkin wrote last month: “The trick to real business success is increasing profitability. That’s where her explanation of her firing — ‘I was fired in a boardroom brawl,’ she says — is only half right. It was a brawl, but the company was unquestionably damaged.”
A decade later, H.P. is still struggling, trying to find its footing in a business in large part driven by mobile devices — not desktop computers, and not printers. On Tuesday, the company announced 30,000 layoffs.