Carly Gets an “F” from Fortune

Carly Fiorina sole “qualification” for the high office to which she aspires is her supposedly successful business career.  Fortune takes a closer look at CF’s tenure at HP and the results are not good.  Fortune asks the simple question, How did she do?

The answer in short is: Pretty badly.

In 1999, a dysfunctional HP board committee, filled with its own poisoned politics, hired her with no CEO experience, nor interviews with the full board. Fired in 2005, after six years in office, several leading publications titled her one of the worst technology CEOs of all time. In fact, the stock popped 10% on the news of her firing and closed the day up 7%.

Arianna Packard, the granddaughter of HP’s founder, commented when discouraging voters from supporting Fiorina in her 2010 senatorial run, “I know a little bit about Carly Fiorina, having watched her almost destroy the company my grandfather founded.”

However, before Conservative Political Action Caucus in February, Fiorina proclaimed that under her HP command, “We would double its revenues to $90 billion, triple its rate of innovation to 11 patents a day, and go from a laggard to a leader in every product category and every market segment in which we competed.”

Sure, she doubled revenues—through a massive, ill-conceived, controversial acquisition of Compaq Computer in 2002.  Fiorina did nothing to increase profits over her five-year term, with the S&P 500 showing net income across enterprises concomitantly up 70%. Furthermore, shareholder wealth at HP was sliced 52% under her reign against the S&P, which was down only 15% in that bearish period. She modeled the old joke of “making it up in the volume.”

Fiorina rammed the Compaq deal through despite intense opposition by analysts, employees, and shareholders. When it appeared that she would lose the proxy vote, the balance was tipped back the other way using hardball tactics that would make Donald Trump wince.

The lost shareholder wealth and lost strategic direction at HP are only part of Fiorina’s legacy. Also lost during her reign were 30,000 U.S. tech jobs, the company’s revered employee morale, and the egalitarian, humble HP way culture. A new defensive, finger-pointing style of leadership led to waves of firing. Dissent was equated with disloyalty as discovered by Walter Hewlett, a board member and son of HP’s co-founder, when he questioned Fiorina’s misguided Compaq acquisition strategy and refused to be bullied into a board statement of unanimous consent, suffering legal and personal threats.

Despite such carnage, Fiorina pocketed over $100 million in compensation for her short reign—including a $65 million signing bonus and a $21 million severance. I have studied comebacks from adversity, but she’s not shown the required contrition nor earned the needed exoneration, and she’s not served as a CEO since. Upon leaving Taiwan Semiconductor’s board, the firm disclosed she only attended 17% of the board meetings. Under Meg Whitman’s brilliant leadership, HP’s character and performance have recovered, but we have not seen Fiorina’s parallel resilience just yet.

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