The Mark Hurd Show

In the CEO’s job, one strike and you’re usually out. The former head of H-P had two.

Mark Hurd is fired as Hewlett-Packard CEO as the upshot of a questionable sexual harassment complaint—and Oracle’s Larry Ellison thinks the proper analogy is to Apple’s ouster, in 1985, of its wunderkind co-founder Steve Jobs. At the time, recall, Apple was consumed in a debate, not about soft-porn actress Jodie Fisher, but about how to adapt to the decisive triumph of the Wintel standard.

You could almost suspect a backhanded Ellisonian genius at work, deliberately drawing an analogy designed to flush out a far more apt analogy. This one too involves Mr. Jobs—and Al Gore. As an Apple director, the former vice president preserved the company’s chief asset by producing a 2006 report to whitewash Mr. Jobs’s role in backdating management’s stock options.

Mr. Ellison, a friend of Mr. Hurd, in his now-famous letter to the media, could not have meant that the H-P board had deprived itself a visionary genius who would go on to invent new industries. If he meant anything serious, Mr. Ellison meant that H-P directors, in firing Mr. Hurd, had thrown overboard a valuable executive to minimize the public-relations risk to their own hides.

This is exactly the opposite of what Al Gore did. He got little credit at the time, and was undoubtedly glad of it, since his mission was successful only if no one noticed it. As an Apple director and head of a three-member panel assigned to investigate the Apple backdating scandal, he had the courage to be unconvincing—excusing Mr. Jobs of everything except naiveté about the finer points of accounting rules for management stock options.

For a CEO, it’s usually one strike and you’re out. The former head of H-P had two.

The two cases are similar enough in the ways that matter. Mr. Hurd was a CEO highly valued by the stock market. His offenses were piddling enough that even now we can’t get a persuasive statement of them. One difference, though, is that this would have been the second time the H-P board had to mount a rescue operation for Mr. Hurd. In the CEO’s job, one strike and you’re usually out. Mr. Hurd has had two.

Let’s recall a little history. H-P in recent years has been a problem child of Silicon Valley, and of this column. We defended Carly Fiorina against her critics, and her strategic gropings have played a role in the company’s relative success in recent years. We’ll defend Mark Hurd too, for his ruthless devotion to efficiency, for executing on what was essentially Ms. Fiorina’s choice to keep H-P together, to get bigger and try to latch on to the convergence of consumer electronics and information technology toward the cloudization of everything.

An early bump in the road, though, was his role in the 2006 scandal in which the company, attempting to quell leaks from its soap-operatic board, employed private investigators to steal the phone records of board members and journalists. You will remember the flaying and humiliation of H-P’s highly reputed board chairwoman, Patricia Dunn, who became the primary fall person.

You are less likely to recall the unconvincing press conference of Mr. Hurd, in which he tried to project an air of “accountability” while simultaneously claiming to have been remote from the shenanigans.

We gave an ironic rendition of his performance here in a column on Sept. 27, 2006. Mr. Hurd admitted what he couldn’t deny, including directly authorizing the seminal dirty trick, namely using an email scam to lure a reporter into exposing her sources. Otherwise, he adopted every minimizing adjective in the book, as did his board, as did the media, all playing along with the company’s strategy of saving Mr. Hurd at the expense of Ms. Dunn.

Today, all the other stuff you hear may be true—that Mr. Hurd was unpopular because he brutally cut jobs, cut costs, cut research spending, imposed discipline, and did so without conspicuously feeling the pain he imposed on others. In other words, a lot of what you hear are the sickly moanings of the vaunted “H-P way”—a set of admirable teamwork principles that nowadays is mostly invoked to resist unwelcome change.

Such mythologies have a way of becoming entrenched just as they’re least useful. Mr. Hurd’s style of wearing himself out against this brick wall of conceit may have been different than Ms. Fiorina’s style of wearing herself out against it. But both were done in by the same thing, essentially, even as each had their successes in moving the company beyond it. We’re guessing the same will be true of the next CEO too.

Holman Jenkins Jr., Wall Street Journal


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