Wednesday, February 09, 2005

Last female Dow Jones CEO fired

Many people focus on the percentage of women among the new tenured professors, which slipped below 15 percent, but no one cares about the world of business too much. Sheila Lennon explained in her article - published in many sources that require subscription - that the following story is not a feminist issue because its hero may be female, but she is also a greedy capitalist.

The Dow Jones industrial index is composed of 30 companies. Carly Fiorina has been the CEO of Hewlett-Packard for a couple of years - since 1999. She's a rather impressive person - she holds a bachelor's degree in medieval history and philosophy from Stanford, a MSc. degree from MIT, and an MBA from Maryland. She has been working for Cisco, Kellogg, Merck, Lucent, and AT & T.

Because she was just fired and replaced by Robert Wayman as interim CEO, all 30 Dow Jones companies have currently male CEOs.
All the computers I've bought in the last 10 years were Hewlett-Packard products - a desktop and laptops - which makes these developments a bit interesting for me. The main decision that Fiorina has been criticized for was her purchase of Compaq in 2002 that failed to increase the profits.

Once Fiorina is ousted, the HP's stock soars: the price immediately jumped by 11 percent as the investors celebrate that the woman is gone. I would be skeptical about such reactions. Although some of her "social" inclinations are not exactly my cup of tea, in my opinion, Fiorina has been still a kind of hero - and the first or the second most influential woman in business (perhaps after the eBay CEO). You can't expect miracles - just compare the HP's performance with the most obvious competition. Compaq has been bought by another company; IBM had to sell its legendary PC production to the Chinese Lenovo; and Dell continues to do well. The Lenovo deal may sound exciting, but it still seems as a success of the Chinese, not a success of the managers of IBM.

I don't think that HP is gonna do much better without Fiorina. And let me admit that even if it will, I may continue to think that it's because of the acts by Fiorina that improved the situation of HP and its abilities to deal with the competition. In my opinion, the HP shareholders have nothing to celebrate today. The company has considered a split many times, and Wayman has been an opponent of the merger with Compaq. We may expect some fragmentation now, and I am not sure whether it will be a positive development for HP.

OK, finally: even if the investors are right and getting rid of this brave woman is a reason to increase the price of the stock by 11 percent, let me say that I think that it will be much less fun!

At any rate, you should not waste with your compassion about Carly Fiorina! Because HP does not want her to be starving and dying of hunger, they will give her 21 million USD to say good-bye. ;-) Update: 45 million!


  1. This is caused by the fact that women are completely inept at buying and managing computer companies.
    I have proof of this: I once bought my daughter two computers, and she immediately started calling them "daddy computer" and "baby computer".

    I know many, including one hundred Stanford professors of many disciplines, will think this is a load of ignorant and bigoted nonsense.
    However, these people are not scientific enough.
    Really scientific people, like Bill O'Reilly and Rush Limbaugh, praised me for my courage in making these statements, and that's good enough for me.

  2. Dear Anonymous,

    I agree with you that given the current events and available facts, it seems that you have all the cards to support your conjecture that women simply aren't as well hard-wired as men for leading the computer industry. Nevertheless, I would still consider such a conclusion premature - and the question whether Carly has been so bad for HP has yet to be answered.

    I also agree with you that O'Reilly and Limbaugh probably have a more scientific approach to these questions than many others - for example the 100 students and professors participating at the bizarre Stanford event you mentioned - but I don't see a direct link of this fact to the discussion of HP's policies.

    Your story about "daddy computer" and "baby computer" is certainly not an exceptional one. President Summers cited a similar story, and I think that virtually all of us know stories like that.

    All the best

    P.S. Note that I try to take seriously even the comments that don't look terribly serious.

  3. C'mon Lubos. The real reason for this thread is really an excuse for you to put on your blog a picture you like of this intelligent and attractive lady:)

  4. Hey anonymous!

    I agree she's attractive, and Yes, I prefer to post attractive pictures, but I would like to warn you that she's 50. ;-)

    All the best

  5. Compaq was not a good acquisition for HP. For computer buffs, Compaq was a sinner for having killed the Alpha; Intel's Itanium, which Compaq & HP backed has not come close. Anyway, Fiorina has now paid the price for a poor decision.


  7. "Compaq was not a good acquisition for HP."

    That was a horrible move. There stock was hit hard from this.

  8. Stay in your ivory tower.

    What Mr. Skilling and Ms. F have in common is their indifference to the substance of their businesses. They are all "message." They despise their employees, their shareholders, and their customers; they have little interest in the products their companies sell; but they love themselves and the trappings and power of their rank.