At the last Republican presidential debate, Carly Fiorina had a nice comeback when it was pointed out that she had been fired from her most notable job as CEO at HP.“Been there, done that — twice,” Fiorina replied that Steve Jobs had told her. Carly made it seem as if Steve was her good friend, when according to Steven Levy, Jobs fleeced HP when Fiorina was in charge. Details (and a good laugh at Fiorina's stunning incompetence) below the fold.
Within the tech industry it is argued that Fiorina was fired from HP in 2005 "because she did her job poorly" especially since her high profile moves, such as the merger with Compaq, ended badly for HP. But Levy tells a tale that encapsulates her stunning failures at HP even greater. In January of 2004, Fiorina proudly announced her showstopper at CES - the flagship event for consumer electronics. That showstopper? The baby blue HP iPod. I can almost hear the reader question "The baby blue HP iPod?". Yes, the baby blue HP iPod.
Fiorina had sealed a deal with the Steve Jobs-led Apple for HP to sell HP branded iPods. Now, you may wonder, why on earth would a company whose motto was "Invent!" be excited about rebranding another company's product? Well, for one, up to that point Apple had not had much success getting the 3 year old iPods into retail stores - Apple mainly sold iPods online and at Apple stores. So Fiorina thought she had her big break, she could rebrand another company's product and sell it at your neighborhood Big Boxmart store. In exchange, Apple got HP to ship all their PCs with the iTunes store pre-installed. This was pretty significant for Apple, as HP had a large market share in PCs, and the move allowed Apple to grow its iTunes store business.
Levy however, details the flaws with Fiorina's plan
In return, HP got the right to sell iPods. But not in a way that could possibly succeed. Fiorina boasted to me that she would be able to sell the devices in thousands of retail outlets; up to that point Apple mostly sold them online and in its own stores. But by the time in mid-2004 that HP actually began selling its branded iPods, Apple was expanding to multiple retail outlets on its own. And soon after HP began selling iPods, Apple came out with new, improved iPods — leaving HP to sell an obsolete device. Fiorina apparently did not secure the right to sell the most current iPods in a timely fashion, and was able to deliver newer models only months after the Apple versions were widely available.
The HP iPod never made up more than 5% of total iPod sales.
And what about the color? Fiorina insisted that the baby blue color would differentiate HP iPods from the pristine white Apple iPods. At the time in 2004, Levy was surprised that a design focused Jobs would allow a baby blue iPod, so he asked Steve Jobs. Jobs' reply? A curt "We'll see". Sure enough, when HP iPods shipped in the fall of 2004, they were all Apple standard pristine white. Fiorina had been rolled even on the detail of what color HP iPods would be.
The biggest failure in Levy's article is probably buried towards the end.
When she made her disastrous 2002 acquisition of Compaq, HP took possession of its patents, including those generated by the research division of the Digital Equipment Corporation, the iconic minicomputer company that Compaq itself bought in 1998. It turns out that researchers in DEC’s Palo Alto lab had created a hard-disk MP3 player — essentially inventing key parts of the iPod several years before Apple did. The project never got any love, though a clunky version of it had actually been announced at CES in 2000.
It turns out that Fiorina's company had acquired patents related to technology needed for the iPod. If Fiorina had a working knowledge of the assets her company possessed she could have used those assets as negotiating leverage with her good friend Steve. Instead, Carly got rolled, the iTunes store became a mega success and the baby blue iPod is a testament to the failed leadership of one Carly Fiorina.
Go ahead. Read the entire article. And share it whenever you hear people cite her HP experience as a qualification for the Presidency.
