Fiorina's Confrontational Tenure at Hewlett Comes to a Close

The New York Times > Technology > The Departing Chief: "It came as an icy moment in an already tense news conference last month during the annual World Economic Forum in Davos, Switzerland. Asked to describe her relationship with her board, Carleton S. Fiorina, the Hewlett-Packard chief executive, replied with a single word: 'Excellent.'

Perhaps she was in denial, or just out of the loop, but Ms. Fiorina's confrontational tenure as chief executive of the world's second-largest computer company was unraveling. Back in the United States, the company's board, which had brought Ms. Fiorina in with great fanfare in 1999, had begun discussing ways to limit her power and give more day-to-day authority to several of the operating executives. She was told point-blank by three directors at a Jan. 12 meeting in San Francisco that she had to change her style.

Concerned about her refusal to budge, directors convened a special board meeting beginning on Sunday evening at a hotel near O'Hare International Airport in Chicago. At the meeting, Thomas Perkins, a former board member and a legendary Silicon Valley venture capitalist, was asked to rejoin the board after discussions with another candidate fell through.

The meeting continued into the next day. While she was staying nearby, Ms. Fiorina was excluded from the discussions. On Monday, the board told her that they wanted her to resign. She was stunned, according to one person familiar with the discussions.

It was an ignominious end to a six-year run that began when Ms. Fiorina was made chief executive - and the first woman to head one of the nation's 20 largest public corporations - as part of an effort to shake up a slow-moving corporate culture.

She also became a globe-trotting evangelist for Hewlett-Packard's leadership in digital convergence, and its drive to be all things to all people. She engineered the Compaq merger against big odds, and then drove Hewlett-Packard into toe-to-toe competition against I.B.M. in corporate services, Dell in personal computers, Kodak in digital cameras and Xerox in copiers.

Her personality and management style ultimately led to her demise. She used hardball tactics to suppress the opposition to the 2002 Compaq merger by Walter Hewlett, the company's largest shareholder and the son of the founder William Hewlett.

She even twisted the arms of fund managers to vote their shares in favor of the merger, leading to regulators fining Deutsche Bank $750,000 to settle accusations that it failed to disclose a conflict of interest related to its role in the merger.

In the end, her superstar status was also her undoing. The board concluded that she was spending too much time on the road, neglecting the nuts-and-bolts execution of her own strategic ideas. According to a person familiar with the board's decision, "It's all about performance." Her dramatic departure mirrors her rapid rise to the position as the number-one woman in American business six years ago. She had been known as a top-notch sales executive at Lucent Technologies, the maker of telephone network equipment, and she brought to Hewlett-Packard a luster and a sense of corporate style the firm was badly lacking at the height of the dot-com era.

Ms. Fiorina filled the San Diego Convention Center with 1,600 employees and broadcast the event around the world on satellite television, while executives back at corporate headquarters in Palo Alto, fretted about a day of lost productivity.

When Ms. Fiorina, who is now 50 years old, took the reins at Hewlett, she became the first outsider to ever run the company. Her appointment as chief executive drew attention in part because she was the only candidate for the job without direct experience in the computer business. Rather, her world was that of telephone equipment. At the time, she was group president of Lucent Technologies' Global Service Provider business, a $20 billion business in which her customers were long-distance and local telephone companies, and Internet and wireless service providers.

Prior to that, Ms. Fiorina had been instrumental in AT&T's 1996 spinoff of Lucent, and in helping create the new company's brand image. Soon she found herself running Lucent's consumer business. She deserved her star status at Lucent, said Ashton Peery, a former company executive who was head of strategy and business development at the time. Ms. Fiorina, who grew up Cara Carleton Sneed, came to Hewlett via a circuitous route. After graduating from Stanford University with a degree in medieval history and philosophy, she took a variety of jobs, including as an assistant in a financial services company and as a translator for Italian businessmen traveling in the states.

She went to law school, but dropped out after a year, much to the disappointment of her father, an attorney. But she went back to school and earned an M.B.A. from the University of Maryland and eventually a masters in science from Massachusetts Institute of Technology's Sloan School.

Her first job after business school was a low-level position at AT&T's government sales office in Washington. According to the folklore, she made it clear she didn't intend to stay long. She stayed nearly 16 years at AT&T, and another three at Lucent. Although there has been widespread Silicon Valley speculation that Ms. Fiorina's stay as Hewlett's chief executive was only a waystation on her path to a political career, that does not seem to be an option at the moment."