Fiorina, Whitman, Hurd Failures Show Importance of Employee Care

Rob Enderle

Carly Fiorina and Meg Whitman, after spending millions, lost their California election bids and Mark Hurd got chased out of HP. None of these executives seemed to grasp that their employees were people and that the risks of treating people badly are quite different than those associated with shedding excess physical assets. During the California elections and Hurd's departure from HP, these risks again became evident. We should explore that today while the topic is fresh.


Carly Fiorina's Lesson


Fiorina's biggest goal over the past decade or so was to be successful in politics. She put her job at HP at risk, and was fired, in part because she spent too much time working on the George Bush re-election campaign. She was later branded one of the Worst American CEOs of all Time. She also spent a considerable amount of her personal wealth on her own failed campaign. This effort was all largely wasted because she simply didn't understand the critical need to take care of her people.


In a company like HP, which has around 300,000 employees, you have a huge potential voting block. Meanwhile, elections are often decided by a few thousand votes. In addition, when folks are upset with you, the rule of thumb is to multiply it by 20, suggesting that if you were to gain the support of that 300,000, it would result in 6 million potential votes. A fraction of that could have won Fiorina the election. However, she didn't see the connection between her goal of winning a place in government and the people that she was responsible for. As a result, instead of these numbers working for her, they worked against her, and she lost big.


The recurring lesson is "take care of your people and they will take care of you." And if you don't, "take care of you" takes on a whole different meaning.

Meg Whitman's Lesson


Whitman was effectively taken out of the race by her housekeeper (though clearly she had other issues). She did a good job of taking care of her employees at eBay and most supported her in the election. However, she had a longtime housekeeper who was an illegal immigrant. Given similar problems have ended the political careers of many presidential appointees, you would think this would have been vetted early on as a potential risk, particularly in a state sharply divided on how to deal with the issue.


However, once this was discovered, Whitman was presented with a choice: She could either take care of her longtime employee or abandon her and run the other way. By doing the former, she might upset her party, but she would gain the voting support of the Hispanic community, which makes up a massive voting bloc. She chose the latter and instead appeared incompetent, uncaring and lost a massive number of voters.


The lesson here is also one about taking care of your people, but it illustrates the fact that one person can make a huge difference. In this case, that difference worked against Whitman, who is $140 million poorer, but apparently no wiser.


Mark Hurd's Lesson


I've rarely seen an entire company turn against a CEO the way HP turned against Hurd when he was fired. Ironically, the only recent time previously was with Carly Fiorina and, even then, she didn't have the bad reputation that has been connected to Hurd.


The story recounted in the book, "The Big Lie," that Hurd threw one of his biggest initial supporters, Patty Dunn, under a bus for the pretexting scandal was chilling. It was particularly so because he, not Dunn, was calling the shots at the time. When you added that Dunn was undergoing chemotherapy at the time and couldn't defend herself, well, it was hard to look at Hurd and not think poorly of him.


Even after seeing what the layoffs during Fiorina's tenure did had done to HP and how she was treated after she left, Hurd continued this practice. It drove employee loyalty to legendary lows and now creates a huge cloud for him and Oracle, which likely will have increased retention and acquisition problems as this reputation spreads.


Had he taken better care of his people, and particularly Patty Dunn, he probably wouldn't have been fired in the first place, and he wouldn't have an image that will make it vastly harder for him to be successful at Oracle.

Wrapping Up: Take Care of Your People


I've spent much of my life trying to convince executives of the benefits of creating companies that are great places to work. Silicon Valley was founded on doing that, and my first high-tech company actually had a Great Place to Work department. Executives seem to ignore the fact that getting the support of employees pays huge dividends and that employees who can't trust their management are both disloyal and relatively unproductive. We seem to be awash in executives like Hurd, Whitman and Fiorina who treat employees badly, then seem shocked when folks slash their tires or turn against them in elections.


As a manager and an employee, you have a choice in how to treat people and where to work. I've watched during the past few years a lot of powerful people. Those who take good care of their employees tend to find they are surrounded by meaningful friendships and have support when they most need it. Those who don't tend to be surrounded by things they have to manage and people who are after their wealth. In the grand scheme of things, the big boats, cars and mansions don't mean much unless there are people you like and can trust to share them with. It amazes me how many seem to forget this.

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