More on the story.

http://www.nytimes.com/2001/11/08/business/08PLAC.html?todaysheadlines

John Lee



At 12:48 AM 11/8/01 EST, Wirt Atmar wrote:
>The old HP way is still alive at least in Bill & Dave's children. The
>following is from the November 6th San Jose Mercury News:
>
>=======================================
>
>Packard says he's displeased with the direction of HP
>He doesn't like the new culture
>BY TRACY SEIPEL
>Mercury News
>
>David W. Packard, the only son of Hewlett-Packard co-founder Dave Packard,
>said Tuesday he decided to join Walter Hewlett in opposing HP's proposed
>acquisition of Compaq Computer for more than just financial reasons.
>
>Packard doesn't like the direction the company has taken, and in 1999 --
>before current CEO Carly Fiorina was hired -- made it known when he resigned
>from the HP board after it decided to spin off Agilent Technologies.
>
>He doesn't like the merger -- which he said ``depends on massive employment
>layoffs -- at least 15,000, probably more.''
>
>``I agree with Walter's statement that gave a lot of business reasons this
>merger is a bad deal and I share all of those reasons,'' Packard said.
>
>And he definitely doesn't like the new culture implemented by Fiorina.
>
>``For some time I have been skeptical about management's confidence that it
>can aggressively reinvent HP culture overnight -- a culture that developed
>over many years and was thoroughly tested under all kinds of business
>conditions. . . .'' he told the Mercury News on Tuesday afternoon.
>
>``. . . I am perfectly aware that HP has never guaranteed absolute tenure
>status to its employees; but I also know that Bill and Dave never developed a
>premeditated business strategy that treated HP employees as expendable. This
>new approach seems likely to affect the confidence and loyalty or the
>remaining employees. For over 50 years, one of HP's fundamental corporate
>objectives has been to provide long-term employment for its people.''
>
>Packard also said The Packard Humanities Institute, which he founded and
>which owns more than 25 million HP shares, would not vote its shares to
>support the proposed merger.
>
>He was careful to say that he was not speaking for other Packard family
>members or for the David and Lucile Packard Foundation, chaired by his
>sister, Susan Packard Orr. That foundation, started by his parents in 1964,
>controls 10.4 percent of HP stock, making it the company's largest single
>shareholder.
>
>How the Foundation's 12 board members vote could make or break the deal,
>observers say. George Vera, the Foundation's chief financial officer, on
>Tuesday said the board is hiring its own independent consultant to analyze
>the proposed acquisition. He said the board will make its own decision, which
>would probably be voted on after the New Year.
>
>In an interview, the 61-year-old Packard -- a former professor of Ancient
>Greek and Latin studies, and chairman and president of the Packard Humanities
>Institute and Stanford Theatre Foundation -- explained his reasoning.
>
>``I sort of care more about some of the old-fashioned cultural values than I
>really should,'' Packard said. He is ``quite unhappy,'' for example, about
>the so-called ``5 percent rule'' -- performance evaluations that mandate
>identifying a bottom 5 percent of the company's performers.
>
>``HP never did that, it never happened before. HP almost never laid anybody
>off, but HP was very careful to say that it's not like they're schoolteachers
>-- they did not have tenure,'' said Packard.
>
>``But they (his father and Bill Hewlett) managed a company in a way that it
>was never necessary to tell people `Sorry, business is not very good, so
>goodbye.' ''
>
>Packard, who has known Walter Hewlett since the two were young children, said
>he also wanted to show solidarity and offer his moral support.
>
>``Walter is sticking his neck out here,'' said Packard. ``Some people will
>praise him and some people will publicly criticize him, but I do share his
>views. And I thought I might as well go on the record,'' he said.
>
>=======================================
>
>Wirt Atmar
>
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>

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