Advertisement
YOU ARE HERE: LAT HomeCollectionsFixme

David Packard Retires as Head of Hewlett-Packard : Electronics: At 81, co-founder of Silicon Valley powerhouse says, 'It's time for me to step aside.'

September 18, 1993|JONATHAN WEBER | TIMES STAFF WRITER

Ending one of the most extraordinary careers in California business history, David Packard on Friday announced his resignation as chairman of Hewlett-Packard Co., the electronics powerhouse he co-founded 54 years ago.

Together with partner Bill Hewlett, Packard built a company whose technical competence, innovative management practices and consistent commercial success made it the prototype of the high-tech start-up and one of the most widely admired corporations in the world.

In an emotional farewell at H-P's Palo Alto headquarters, the 81-year-old Packard, who suffers from hearing and speech problems but remains quick-witted, said he was finally comfortable leaving the company in the hands of chief executive Lew Platt, who assumes the chairman's post.

"At my age, it's time for me to step aside," he said, sitting beside Hewlett in a packed company auditorium. "The company is in a strong competitive position and we have an excellent management team in place. . . . This is a good time to make the change."

For the Record
Los Angeles Times Tuesday September 28, 1993 Home Edition Part A Page 3 Column 4 Metro Desk 2 inches; 53 words Type of Material: Correction
Packard Foundation--In a Sept. 18 story about the resignation of Hewlett-Packard Chairman David Packard, The Times incorrectly stated the relationship between the David & Lucile Packard Foundation and the Monterey Bay Aquarium. Although the Packards paid for the museum's construction, the aquarium says neither they nor the foundation have given any money subsequently.

Although Packard gave up day-to-day management of the company well over a decade ago, he had remained involved in the business, stepping in three years ago to lead a remarkably successful corporate overhaul.

And his legacy extends far beyond the business world. He has used his multibillion-dollar personal fortune to become one of the nation's leading philanthropists, and has long been a force in Republican Party politics.

"The way he and Bill (Hewlett) conducted themselves--the business they built, the values they stressed, the strong belief in putting back into the community the profits they made--that has become a paradigm that has inspired many people," said Ed Zschau, an entrepreneur and former congressman who runs a major IBM division in San Jose.

The son of a Midwestern lawyer, Packard earned an engineering degree at Stanford University, and in 1939 joined with his classmate Hewlett to start an electronics company with $538 in seed capital. They didn't know exactly what they were going to make: Hewlett once said that "professors of management are devastated . . . when I say we were successful because we had no plans."

The company's first commercial sale came when Walt Disney ordered some audio equipment for the soundtrack of the movie "Fantasia," and H-P soon grew rapidly as a supplier of electronic instruments and test equipment. In the late 1960s, H-P came out with the hugely popular electronic calculator, and in the 1970s and 1980s gradually established itself as a leading computer vendor.

Packard and Hewlett formed a remarkable team: The strapping Packard was the more public figure, focusing on business issues, while the more retiring and soft-spoken Hewlett concentrated on technology. But they thought remarkably alike and shared management of the company equally.

Packard was chairman and chief executive until he left to serve as deputy secretary of defense in the Nixon Administration in 1969. Hewlett, who had been president, became CEO and kept that post even after Packard returned as chairman in 1972.

In 1978, John Young took over as CEO, but Packard remained as chairman and Hewlett as vice chairman. Young stepped aside in favor of Platt last year, shortly after the founders had reasserted themselves in a successful effort shake up a bureaucracy that had grown complacent.

Today, H-P boasts annual revenues of more than $16 billion, and is virtually the only major computer company to have avoided big losses and layoffs during the tumultuous industry price wars of the last few years.

Underlying that success was a management philosophy known as the "H-P Way," which emphasized respect for the individual, teamwork, integrity and egalitarianism--mom-and-apple pie values that really meant something at H-P. Both Hewlett and Packard retained a strong sense of personal modesty, forgoing lush corporate offices or other perks of power, and both are known for absolute straight talk. "With David Packard everything was upfront and honest, there was absolutely no phoniness about anything," said Melvin Laird, who tapped Packard as his deputy when he served as secretary of defense and remains a close friend. "He has common sense and judgment that could not be equaled."

H-P also pioneered several specific management techniques that have become widely followed in the corporate world and are found in nearly every business school textbook. One is known as "management by walking around," a method by which senior executives can stay in touch with what is happening on the shop floor. They also instituted what became known as "management by objective," the seemingly simple idea that people basically want to do a good job, so managers should establish what they want and leave people to do it.

Advertisement
Los Angeles Times Articles
|
|
|