David Packard, Silicon Valley Icon, Dies
David Packard, co-founder of Hewlett-Packard Inc., patriarch of the Silicon Valley and one of the most influential figures in all of American business, died Tuesday of pneumonia. He was 83.
Packard died at Stanford University Medical Center in Palo Alto, surrounded by his four children. He had been hospitalized since March 16.
From humble beginnings in a Palo Alto garage 57 years ago, Packard and his partner, Bill Hewlett, built a company whose technical competence, innovative management practices and consistent commercial success was an inspiration to generations of high-technology entrepreneurs.
Packard ideas such as “management by walking around” and “management by objective” are staples of business schools the world over. And Hewlett-Packard has maintained a leadership role in the electronics industry even as many longtime rivals proved unable to keep up with fast-changing technologies.
Packard also made his mark in politics, serving three years as deputy secretary of defense under President Richard Nixon. And he was a major philanthropist, supporting projects ranging from the Monterey Bay Aquarium to Stanford University’s Lucile Salter Packard Children’s Hospital.
The David and Lucile Packard Foundation, with reported assets of $2.3 billion, last year distributed $116 million to more than 700 recipients. All of Packard’s 9.1%, or 46.6 million shares, of HP will go to the foundation.
“David Packard’s death is a loss to the company and the country that he loved so well,” Bill Hewlett said in a statement. “I will not attempt to list his many awards and achievements. . . . The greatest thing he left behind was a code of ethics called the HP Way.”
Stanford University President Gerhard Casper said the university had lost one its “staunchest friends.”
“His contributions to Stanford have touched nearly every part of our academic endeavor, nourishing and replenishing us year after year,” Casper said.
Microsoft creator Bill Gates called the pioneering Packard “an amazing guy” in the computer field, adding, “I admired him.”
Born in 1912 in Pueblo, Colo., to a lawyer and a high school teacher, Packard decided in grade school that he wanted to be an engineer--even though his father had hoped he would follow in his footsteps and study law.
Packard studied electrical engineering at Stanford, and it was there he made two important friendships: with Hewlett, whom he met during his freshman year, and with Fred Terman, a young professor who encouraged the two to think about starting their own company.
Packard also met his future wife, Lucile, while serving meals in her sorority dining room. She died in 1987.
Upon graduation, Packard took a job with General Electric, and Hewlett enrolled at the Massachusetts Institute of Technology as a graduate student in engineering. They were united a few years later by Terman, who awarded Packard a fellowship at Stanford and found Hewlett a job. In 1939, with $538, they started their company, tinkering on projects that Packard called “inventions to order.”
The company’s first product was an audio oscillator, and among their first customers was Walt Disney Studios, which used the device in making the movie “Fantasia.” By the end of 1939, HP had made a $1,539 profit on sales of $5,369--and was profitable every year after that.
The company grew quickly, becoming a leading supplier of electronic instruments and test equipment. It followed up that success with the enormously popular HP electronic calculator, introduced in the early 1970s.
In the ‘70s and ‘80s, the company moved aggressively into the computer business and eventually established itself as a leading supplier. Today, it is the second-largest computer company in the United States, with sales of $31.5 billion and more than 100,000 employees in fiscal 1995. In recent years, the company has become the dominant producer of laser printers which, in turn, has enabled it to build a strong position in the consumer personal computer market.
The two founders were perfect complements, with Packard running the day-to-day business while Hewlett was the company’s chief technologist. The 6-foot-5-inch Packard, who believed it was important for upper management to stay close to employees, was a common sight in the hallways of HP.
Although his relationship with employees was generally warm, Packard could be an intimidating presence. “I saw him chew people out who didn’t do their homework,” said former HP general manager Wim Roelandts.
In the late sixties, a young production engineer approached Packard with a money-saving idea: using cheaper metals to package instruments. Packard took the proffered piece of metal, twisted it until it broke, threw it on the factory floor, then walked away without a word.
“The HP Way,” a management philosophy that called for breaking the barriers between management and employees--and emphasizing teamwork and respect for the individual--is in many respects Packard’s greatest legacy. Nevertheless, he was “reluctant to define it,” said Karen Lewis, HP’s librarian who worked with Packard on his 1995 autobiography, “The HP Way: How Bill Hewlett and I Built Our Company.”
“It’s a spirit of enthusiasm and teamwork,” Lewis said. “It encompasses practices like open-door policy and management by walking around. It’s the belief and trust in people.”
“I believe people want to do a good job. They enjoy doing things right and they enjoy making a contribution and they will further respond both in terms of compensation and other nonmonetary rewards,” the plain-spoken Packard once said. “I also believe people always do better work when they have a little fun doing it. They ought to look forward to going to work every morning.”
For a man of his wealth, Packard lived simply in a Los Altos Hills home surrounded by an apricot orchard. At HP, he and Hewlett eschewed the lavish luxuries favored by many other captains of industry.
And HP was able to avoid the layoffs and downsizing that has brutalized so many large corporations in the 1990s. One of Packard’s most unlikely and spectacular achievements, indeed, was stepping back into an active management role at HP in 1990 and spearheading an overhaul that is widely credited with revitalizing the company and preventing the losses and layoffs that plagued IBM and others. He retired as chairman of HP in 1993.
Packard had been HP’s chairman and chief executive until he left for Washington, D.C., in 1969. He served in the Defense Department during the Vietnam War, but found public service trying.
“Lucile would get up in the morning and she would hear something about me on the news and it would ruin her breakfast, she would hear something about me on the noon news and it would ruin her lunch, and then she would hear something about me on the late news and it would ruin her dinner,” he once said.
“Dave was used to making a decision and getting action on it,” said HP librarian Lewis.
Packard tried to apply HP management practices to his new job: he found relations among the Joint Chiefs of Staff so strained that he invited them to a hunting expedition at a ranch he and Hewlett owned in Northern California. Packard cooked dinner and then recruited the joint chiefs to do the dishes.
Even after returning to HP, Packard remained active in Republican politics, serving as chairman of President Ronald Reagan’s Blue Ribbon Commission on Defense Management in 1985 and 1986. More recently, he helped underwrite Proposition 201, the initiative on Tuesday’s ballot making it harder to sue corporations.
In 1989, on HP’s 50th anniversary, the clapboard garage of the modest two-story house Packard and his wife rented (with an apartment for then-bachelor Bill Hewlett), the building in which the two engineers began working on their “inventions to order,” became a California historical landmark. A plaque calling it “the birthplace of the Silicon Valley” now sits on the front lawn.
Packard is survived by four children, David Woodley Packard, Nancy Ann Packard-Burnett, Susan Packard-Orr and Julie Elizabeth Stephens.
* THE PACKARD WAY: Lessons for U.S. business. D1
