First Woman Named to Lead Blue-Chip Firm
Silicon Valley pioneer and corporate icon Hewlett-Packard Co. on Monday named as chief executive Carleton “Carly” Fiorina, already the most powerful businesswoman in America, who earned the reputation at Lucent Technologies as a fearless, high-energy corporate leader.
The move by the No. 2 computer company makes Fiorina the first female leader of a blue-chip company and a standout in the high-technology sector, an industry dominated by men. She replaces outgoing Chief Executive Lew Platt, who oversaw the company as it nearly tripled in revenue to $47 billion in 1998. She is the first chief executive hired from outside the company.
For the 44-year-old Lucent Technologies group president, who last fall was named the country’s most powerful businesswoman by Fortune magazine, gender “is not the subject of the story.”
She and others said it makes sense that HP would be the company to elevate the most powerful woman in U.S. business to an even greater height.
“It’s certainly consistent with HP’s very long and distinguished track record of focusing on talent and merit,” said Fiorina, a UCLA law school dropout whose first paying job was as an HP shipping clerk.
Fiorina, who received degrees from Stanford University, the University of Maryland and MIT, joins an elite group of women heading Fortune 500 companies: Jill Barad of Mattel and Marion Sandler of Golden West Financial.
“She is extremely well-respected internally at Lucent,” said analyst Greg Geiling of J.P. Morgan, one of the underwriters that sold a record $3 billion worth of Lucent shares to the public in 1996. After leading the initial public offering, Fiorina seized the Internet moment at Lucent by pushing its largest unit from a focus on voice-related products to data.
The credit that investors give Fiorina rippled through the stock market, sending Hewlett-Packard shares up $2.25 to a record close of $116.25 and Lucent down $1.60 to $76.83, both on the New York Stock Exchange.
Fiorina is widely seen as a good bet to push the slow-moving HP ahead in the fast-moving Internet-centric economy.
While its printer business and some smaller divisions dominate their markets, Hewlett-Packard badly missed out on the development of the Internet. Earlier this year, Platt admitted the misstep and announced his impending retirement and the planned separation of the company’s testing and measurement unit. Platt will stay on as chairman through the end of the year, when he will be succeeded by retired HP executive Richard Hackborn.
In the last year, the company has begun repositioning itself under the rubric of “e-services” and has been buying or teaming with smaller, nimbler firms to help it sell hardware, software and consulting to corporate customers that provide business applications online.
That effort has been led by company veteran Ann Livermore, who was the strongest internal candidate for chief executive.
Fiorina, who praised Livermore and said the e-services approach is the right one, said the company needs to reevaluate what it’s doing with the personal computer business as that segment becomes increasingly competitive.
“E-services is all about making the Internet work for individuals and enterprises, instead of making the individuals and enterprises adjust to it,” Fiorina said.
Culturally, she said, the challenge is to keep the vaunted HP values of respect and reliability while adding a serious dose of start-up-style momentum.
“We need to look at reinvigorating our speed, our sense of urgency and our determination to win,” she said.
Yet she said she shares with Platt an informal style and “a belief that people make a business.”
Platt said that of the external candidates, Fiorina had the clearest grasp of the “HP Way,” referring to the company’s value system and the book of the same name by co-founder David Packard.
Some of that grasp came during preparations for the Lucent spinoff from AT&T; Corp., when Fiorina visited Hewlett-Packard to study how one of the premiere high-tech companies operated.
“We hit it off right away,” Platt said of that visit.
Fiorina’s hire “is giving HP a sort of speed injection,” said Goldman Sachs computer industry analyst Laura Conigliaro. “It is a really good match.”
“The company is not broken,” Conigliaro said. “Now it has taken a lot of technology with admittedly not as high a profile as you would like and added a high-profile CEO who has a lot of marketing expertise.”
Although women have been a growing force in U.S. business, the biggest and best-known high-tech firms--from IBM to Apple and from Intel to Microsoft--are run by men.
Fiorina, who was born in Austin, Texas, attended five different high schools, from Palo Alto, where Hewlett-Packard is based, to London to Ghana.
After realizing that law school was more about precedent than innovative thinking, she quit.
Fiorina realized she might like commerce when she was working as a receptionist at a brokerage and started to write customer orders.
“It was intellectually stimulating. I like the pace and I like the interaction with people,” she told Investors Business Daily.
She studied philosophy at Stanford, marketing at the University of Maryland and business administration at MIT’s Sloan School of Management.
After receiving her MBA from MIT, Fiorina joined AT&T; as a sales representative and made a series of gutsy career choices, including abandoning an easy job marketing toll-free services for the unglamorous equipment arm that later became Lucent.
Her mantra of putting present tasks above future aspirations was borne out most strongly when she recommended a disbanding of Lucent’s consumer unit that cut out her own job.
“I’ve seen a lot of highflying people fall flat because they were so focused on the next job,” Fiorina told Investors Business Daily.
If Fiorina’s jump from communications to computers will present new challenges, she has repeatedly mastered unfamiliar subjects ranging from finance to engineering. She not only wowed investors on the road show for Lucent stock, but the daughter of a federal appeals judge in San Francisco and an abstract painter picked the equipment maker’s circular red logo.
That kind of marketing savvy could be a big boost for HP as it pushes to distinguish itself, said analyst John Jones of Salomon Smith Barney.
“She’s been a practicing sales and marketing person,” he said. “HP hasn’t had someone like that.”
