Carly Fiorina, one of the vital nation's most prominent know-how executives and a favored image of ladies in massive business, became ousted because the head of computer functions gigantic Hewlett-Packard on Wednesday over "strategic alterations" together with her board of directors.
George Anders, author of perfect adequate: Carly Fiorina and the Reinvention of Hewlett Packard, become online to talk about Fiorina and her tenure at HP.
A transcript follows.
Editor's note: Washingtonpost.com moderators preserve editorial manage over live on-line discussions and judge probably the most valuable questions for visitors and hosts; guests and hosts can decline to reply questions.
washingtonpost.com: George, thanks for becoming a member of us. What became your preliminary reaction in case you heard that Fiorina became leaving HP?
George Anders: advanced reactions. fascination likely become the first one. this was a huge step for the board to take, and the board had been very loyal -- probably too loyal -- to carly fiorina for a very long time.
so i wished to understand every little thing i could about the board's deliberations.
Baltimore: It appears just about all and sundry puzzled the strategic price of the Compaq acquisition. Yet she obtained it executed. does not the Board take a huge part of the responsibility for that error? What adjustments have took place/ will take place to that community?
washingtonpost.com: HP-Compaq still Fuels Debate Over Marriage of Equals (Feb. 10, 2005)
George Anders: There are two units of questions about the Compaq deal -- did it make strategic experience? and was it performed neatly?
The board still defends the strategy. or not it's no longer a simple defense, however's not ridiculous both.
obviously the execution failed to go well. Too many respectable americans left. Too many product rollouts got handled clumsily. it really is all being blamed on Carly Fiorina
la: Any opportunity that Michael Capellas might possibly be in line to take over the helm at HP? Given the entire scuttle about MCI being an acquisition target, does it make experience that MCI and HP merge?
George Anders: Mike Capellas is an enchanting contender. The HP board has noted it wishes to move backyard for a brand new CEO.
but if it goes too a ways outside, it hazards having a different cultural mismatch, because it did with Carly Fiorina. Capellas has the virtue of understanding much of the company and lots of the individuals already.
There are other such candidates, too. Antonio Perez, a former HP govt, now at Kodak
Boca Raton, Fla.: It gave the impression to me that Carly did not circulate fast sufficient again in 2000 to change the tradition or change precise managers when she had her 'honeymoon' length. Then the PWC misstep. It looks that Carly become not strategically decisive at any aspect in her tenure. The Compaq move changed into shielding at top-rated. Is that reasonable?
George Anders: enjoyable duration to focal point on. New CEOs can do a big volume within the first 6 months to 12 months. Then they become part of the establishment. i would trust you -- there were lost alternatives returned then.
Cupertino, Calif.: I see that Carly will get a $21M severance package. combined with her sign-on bonuses, inventory alternate options to replace Lucent alternate options, the Compaq merger bonus, and her regular compensation, it seems that Carly garnered well over $200M in pay for her mediocre performance. Are those pay numbers accurate? When can stockholders (no longer simply HP's) are expecting some rationality in CEO pay?
George Anders: I accept as true with the genuine quantity is a little bit smaller, as a result of most of her sign-on bonus became out to be value under the at the start introduced volume, as soon as HP's stock started to slide.
however your basic aspect is right: that is a lot of money for sub-common performance. I wish there were a way to get this procedure below control, however so far, CEO starvation for more pay has outweighed each try to rein it in
Oakland Calif.: starting to be provider turned into a main a part of the strategy. acquiring cost Waterhouse would have contributed during this direction, (as IBM showed a yr after it did not turn up for HP).
How did the merger with Compaq make a contribution to this method, on the grounds that Compaq changed into in general selling hardware and handiest little carrier ?
didn't the compaq acquisition battle with the "carrier" strategy ?
George Anders: Compaq (by means of the old DEC) in reality had an adequate services company. loads of it turned into home windows support-desk form of work, which is rarely very glamorous, but when you will have ever used home windows, which you can imagine this is an excellent growth company for a long, long time.
The PWC deal might have labored smartly at a decrease fee . . . but switching from a partnership structure to an organization would were very challenging. The PW companions who had been promoting have been likely to wish to retire. And HP mandatory them to preserve working
Fairfax, Va.: How tons of Fiorina was genuine substance and the way plenty changed into presentation/demonstrate? without doubt they all make error, however do you think she was in over her head?
George Anders: I think of her as a bull-market supervisor . . . someone who became very respectable at increasing the company in boom instances, but who didn't basically have first rate instincts for effectivity in complicated instances. When she'd reduce, it turned into with lunges that failed to fulfill both the workforce or Wall road.
And HP is in some very technologically advanced corporations. I feel a proper executive at such an organization needs a deep knowing of the tech to be effective.
Arlington, Va.: I went to faculty with Ann Livermore at HP. She had been "within the working" for CEO when Carly turned into selected in its place. How would you handicap Livermore's existing opportunity of getting the exact job?
George Anders: anything's viable. however her enterprise instruments haven't been the large earnings contributors to HP these days. it's the printing aspect that's been making cash -- and for that rationale, i might see the printing head, Vyomesh Joshi, because the most plausible inner candidate.
anyway, the board has stated it wishes to head outside.
So what became Ann Livermore like in excessive faculty??
Hayward, Calif.: simply how a great deal printer company did HP lose when Dell cancelled HP items as a result of the Compaq merger? Can HP ever get returned into Dell?
George Anders: I consider it turned into less than 3% that slipped away. And Compaq turned into doing business with Lexmark, in order that recouped 1% appropriate away, as Compaq grew to become a captive HP customer.
however there may be always the question of whether HP could have opened a bigger relationship with Dell if the printing company had been standalone. possibly. or not it's an fascinating area for hypothesis
university Park, Md.: i'm very attracted to the brand new path of HP and whom the CEO could be. I even have been a consumer for 3 years now and for probably the most part enjoyed the brand. client provider has declined as the years have previous, which is the best why to hold your present shoppers.
George Anders: consumer service is being whittled away at so many agencies, which is likely one of the beneath-lined scandals of enterprise at the moment. Ever try to get your cell provisioned? Your fridge fixed? a question answered about TurboTax?
the push to lean-and-mean causes lots of businesses to trim again their service departments. I hope that failed to take place.
San Pedro, Calif.: Your opinion please. Which damage worst...purchasing Compaq computers or giving up the clinical electronics division at last to Philips medical systems. I, for some intent miss the historical slow HP.
George Anders: i will understand the attraction of HP's historical scientific business. but that received put into Agilent, after which Agilent execs decided they failed to have "vital mass" to live competitive there.
invoice Hewlett -- the son of a physician -- became the adult who pushed HP into scientific, but once he retired, that became less of a spotlight. Given the boom of equipment companies like Medtronic, might be HP should still have skipped the computing device company within the 1980s and doubled down on clinical instead!
Sevierville, Tn.: what's HP doing to retain my company as a client? after I first purchased my laptop, the rep at HP lied to me and that i consider i used to be cheated out of a hundred and fifty greenbacks in rebates. As i was later instructed, they didn't have a rebate for the varieties that HP sent to me.
George Anders: I don't know the particulars of your rebate snarl, but I've had equivalent experiences with different businesses (Intuit's rebates are notoriously hard to bring together.)
I consider when the board mentioned it desires more desirable execution from its new CEO, or not it's talking to what you're speakme about. The advertisements about HP are best, however they don't remember much if consumers are pissed off. a very good CEO should still focus on that for as long as it takes, and take a look at to get it fixed.
Palo Alto, Calif.: Fiorina changed into feted from the beginning as a celebrity, whatever that certainly not healthy neatly at HP with its subculture of egalitarianism (eg, 'administration by using strolling around'). She hit a false be aware appropriate away via commissioning a series of tv advertisements that confirmed her subsequent to, really basically leaning on, the long-lasting Palo Alto garage where invoice Hewlett and Dave Packard all started HP.
My question, youngsters, issues her tenure at lucent before she got here to HP. She ran the enormous commercial enterprise revenue group. It changed into a sequence of scandals involving this community, specially for off-the-books discounts to gigantic purchasers, that pretty much sank Lucent. lots of these occurred all over Fiorina's tenure. Why has Fiorina on no account been asked about her function during this?
George Anders: I've requested Carly Fiorina about her Lucent music checklist, and others have, too.
or not it's hard to grasp a way to apportion blame. The complete Lucent subculture was go-go on the time, and other executives have come under greater hearth for pushing bad offers. I've heard Carly Fiorina say, after the reality, that she become involved about Lucent's recklessness and saw that as a rationale to go away.
That may be revisionism. Or it may well be proper. i could leave it as much as you to decide.
Ness Ziona, Israel: How did the gap between a a success manager and her board turn into so tremendous?
George Anders: mind-blowing query. They document in contemporary WSJ that the board at first turned into seeking to take an awful lot more modest steps -- having Ms. Fiorina delegate more accountability to working heads, and maybe appointing a strong No. 2 to tackle working details. She resisted that, then agreed to it, then instructed the media that it changed into pure hypothesis and that it may no longer ensue.
I feel the board felt she wasn't keeping to her be aware. And as soon as there are questions about reality and have faith, relationships can unravel very quickly.
Newton, Ma.: Did Carly be triumphant chiefly because she is a woman? And did the narrowness of that success contribute to her loss of life?
George Anders: I suppose being feminine each helped and hurt her. It helped when it comes to making her more visible. On the style up, it become easier to be recognized as a rising talent. on the suitable, it became less complicated to get entry to customers at the optimum stages. (White condominium, and so on.)
however additionally remoted her. She did not get the benefits of any of the historic-boy networks. it might be fine if neither of these factors affected individuals's careers. I feel we're nonetheless a generation or two away from that aspect.
Philadelphia: What happens to Carly Fiorina now? definitely there are different groups that may use her knowledge. What do you see are her undoubtedly future career course?
George Anders: enjoyable query. My bet is that she'll take at the least six months to collect herself, and many others.
After that, i'm certain there may be offers of company board seats, jobs at smaller companies, and so forth. however given the turmoil at HP, my guess is that these can be at a good deal less admired organizations, and that they can also no longer attraction to her.
She's been attracted to govt and education for a long time. I feel it would be challenging for her to win an election, however it wouldn't shock me if she eventually obtained some entertaining appointed submit.
Charlotte, N.C.: what is Walter Hewlett's take/position on all this? It appears like he was correct all along. was he?
George Anders: he's been very low key this week, and his short public remark become gracious and indistinct. (HP is a exotic business with challenges. i hope it does well.) His advisers are asserting he turned into correct all alongside. His argument -- that HP may still have just stayed with its printer business -- become all the time a position that deserved critical consideration.
I do not feel he has any need to return lower back to the HP board. The Hewlett basis has sold just about all of its HP inventory.
Dreamland: I think I may be an outstanding CEO of HP or many other corporations. I too can get a hold of high-idea concepts that are not correct for the company and protect them as some cult-like 'method' at giant meetings and media movements. I've additionally bought government hair and the hand motions down. i will be able to delegate the difficult stuff to my subordinates and blame them and my enemies on the board when issues go incorrect. and produce little to no salary boom, or possibly consistent losses and nevertheless receives a commission $220 million? sure, I feel i can try this. where do I register? How lengthy earlier than individuals realize these new emperors have no outfits on?
George Anders: fundamental company schools are accepting applications presently! Pay 2 years training, work on the right consulting organisations for a couple years, climb the ladder, and you may be on the way!!
I wish I failed to suppose compelled to offer you a mordantly cynical reply. but the cycle is countless
Alexandria, Va.: Mr. Anders, Do you think HP will comply with her imaginative and prescient in the end (I believe she's proper)?
George Anders: hard to inform. The HP board publicly is asserting that it wants to press on with the Compaq-merger method, hoping for enhanced profitability as issues go ahead. With a powerful leadership group that may execute neatly, it be viable that might work well.
Wall highway is agitating for a breakup of the enterprise, into printing vs. computing. but Wall road always is hunting for deals. a new CEO could are looking to do one of these deal, but it surely's harder than it appears. Who maintains the HP name? How do patents get divided up? etc.
Alexandria, Va.: Do you feel the latest article in Fortune (which i believed became a collection-up towards HP once I read it) became a closing straw?
George Anders: Going returned to an earlier answer, I think the breakdown of have faith between Carly Fiorina and the board was the key difficulty. The business performance changed into disappointing but no longer catastrophic. If she and the board had agreed on tips on how to reshape her job a bit and convey in greater operating individuals, she'd still be there.
Fortune, the WSJ and enterprise Week all did reviews suggesting that Ms. Fiorina's recent work changed into disappointing. I consider administrators study all of the publications, however they don't totally take their cues from the media
Houston: the place become she going with the "invent" aspect? That seems greater a part of the H-P past than the current. Did the business commit to continuing research or just trip on previous successes?
George Anders: I had a extremely entertaining dialog with one in every of HP's former CEO's, John young, a while back. He contended that "invent" never was what HP was about. He spoke of "innovate" would have been a much better observe.
Invent sounded pleasant, however misstated the way the business did, does and will make most of its money. It takes based breakthroughs after which refines them into multi-generations of items, including capabilities and reducing costs to preserve shoppers coming back for more.
Austin, Texas: What influence will Fiorina's dismissal have on the other positions she holds on prestigious boards - World economic forum, MIT, NYSE? Will she maintain the authority she clearly loved in these forums as CEO, HP?
George Anders: My guess is that she'll dwell on some but no longer all of them. the us is a good nation for 2d acts. Robert McNamara left the Pentagon in shame and recast himself as head of the realm financial institution. and many others.
Gaithersburg, Md.: within the 1970s say, Hewlett-Packard grew by introducing many particular person gadgets: plotters, pocket calculators, and at last computers. Now the nifty device business has been spun off into Agilent, and HP's huge hardware successes are in the printing enterprise. HP blazed new trails with laser and inkjet printers, and now reaps the reward.
can you speculate on innovations that could repay for HP, or the ordinary possibility of growth on that front?
George Anders: There are some unique things rattling around in HP Labs about different inks, distinct flat-monitor know-how, industrial printing, film compression, and so on.
I believe probably the most promising areas are extra in printing/imaging than in computing. In computing, HP has generally become a packager/reseller of others' technology.
Fairfax city, Va.: whereas i spotted that Mrs. Fiorina had a powerful historical past in sales and advertising, i was surprised that she had no working towards in total first-rate management given how satisfactory pushed HP has all the time been. could her lack of advantage in that enviornment been her downfall? She actually had the educational background, job event, own, and willfulness to be a success.
George Anders: TQM is rarely the only approach to come back at nice issues -- but definitely any executive in a mass-creation, a bit commoditized industry should have a company grip on nice considerations.
Washington, D.C.: involving the first question: could the Compaq merger have been executed correctly? If the execution turned into extraordinarily tricky or in all probability unattainable, then it be challenging to look in what sense the strategy became suitable.
George Anders: smartly, what did HP should do?
-- Get costs out of the notebook enterprise so that it may well be ecocnomic. It made some headway there. might be 6 out of 10.
-- Wiggle out of an extreme reliance on Unix machines in business computing, and develop into extra of a factor in NT and Linux. Compaq's product line helped here, however HP was slow to make this take place. four out of 10.
-- build up a quick-transforming into and extremely profitable services company. HP did not beginning with much, and Compaq brought a little extra. Realistically it wasn't going to trap IBM, nevertheless it could have narrowed the gap more. maybe 5 of 10.
So, not one of the key goals have been effortless, but I feel there changed into a chance to do stronger
Leland, unwell.: Do you suppose degradation of consumer help lead in any way to lack of sales?
George Anders: we've said this a couple instances, and that i'll accept as true with the thrust of the question all over again. I wrote my publication, "excellent adequate," on an HP desktop that needed to have its monitor replaced, necessary to have its difficult pressure mended, and had a shocking erosion in battery life throughout its usage.
i love the design and specs of the desktop, but after 2 years of the use of it, I've put it in storage. i'm ordinarily the usage of a ThinkPad at the moment.
Munich, Germany: As hardware becomes cheaper, the best things that seem to count number are price, price and price.
Do you believe that Carly Fiorina's dismissal is a milestone for the desktop trade in terms of declining emphasis on service?
George Anders: all of it depends upon what variety of new CEO the enterprise picks. The business may go either manner on the price/carrier curve.
at this time, there is an argument that or not it's trapped in a bad area. not as provider-wealthy as IBM; now not as thrifty as Dell. Which course would you love it to movement?
washingtonpost.com: George, thanks once more for answering questions from readers. Any parting suggestions?
George Anders: Thanks for the possibility to do that. i'm pleased to hear individuals asking so much about consumer provider. it's the forgotten part of the story -- make respectable items and everything else will determine. Come up brief, and all the sizzle on this planet may not save things