Top 5 Ironies of The HP Scandal

Fallout from the boardroom drama has many implications.
Posted September 26, 2006
By

David Needle


1. Hurd's Stronger Than Ever?

While the scandal has battered CEO Mark Hurd's once sterling reputation and even threatened his tenure at HP, his influence and power at the world's biggest computer company has, for now, actually grown.

Hurd's assumed the additional title of chairman of the company and is in a position to largely reshape the board of directors he inherited when he took over the top spot last year.

2. In The Privacy Awards Business

Next month HP will join with the International Association of Privacy Professionals (IAPP) as co-sponsor of the annual "Privacy Innovations Awards".

Winners will be awarded in different categories, including those who demonstrate "high levels of integration of privacy protection throughout their entire business process" and "innovative privacy technology."

3. Dunn in Good Company

The day before she agreed to resign in the wake of the scandal, HP Chairwoman Patricia Dunn was feted at an event in San Francisco where she was inducted into the "Bay Area Business Hall of Fame."

The honor, scheduled long before the scandal burst on the scene, is given annually by the Bay Area Council, a business-sponsored, public policy advocacy group.

Larry Sonsini, chairman of the Wilson Sonsini Goodrich & Rosati law firm, was inducted last year.

Sonsini advised former HP director Thomas Perkins (another past recipient of the award) that the company's leak investigation, including the use of pretexting, was "well done and within legal limits."

He later told the Wall Street Journal that after reviewing the practices, he couldn't confirm they were legal. Sonsini is scheduled to testify before Congress on the matter this week.

In 1995 the Bay Area Hall of Fame inducted HP founders William Hewlett & David Packard.

4. Facing a Recruitment Crisis

Depending on how the congressional hearings go this week and what, if any, criminal charges are brought against HP officials, the company could begin to have problems attracting the talent it needs to continue its current level of success.

"In a highly competitive market for intellectual capital in IT, HP hasn't done itself any favors creating what can easily be perceived as a culture of fear and suspicion," said consultant Todd Merriman in an e-mail to internetnews.com.

"In an era when companies are focusing on developing compelling 'employment brands,' having the perception of a Big Brother culture isn't the kind of foundation you're looking for," added Merriman, who works for the New York-based Group1066, a marketing strategy firm.

5. Fiorina's Publishing Payday

Carly Fiorina. The former HP CEO was ousted by the company's board which brought in Hurd. There's evidence the leak investigation started while she was still CEO, but Fiorina has been noticeably silent on the matter.

Meanwhile, in a bit of timing publishers can usually only dream of, Fiorina's tell-all book about her tenure at HP, Tough Choices: A Memoir, is slated to hit the bookshelves Oct. 9.

This article was first published on InternetNews.com. To read the full article, click here.






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