WC doesn’t want to be perceived as neglecting the distaff side of the throng of Republican presidential wannabes. There is a woman running, of course, a woman whose resumé would give any modest person – male or female – reason to hesitate before appearing in public. WC refers, of course, to the inestimable Ms. Carly Fiorina.
WC will disclose in advance that he has a family member who has experienced Ms. Fiorina’s breath-taking incompetence first hand. He was a victim of Ms. Fiorina’s driving that corporation onto the financial rocks. But WC will endeavor to set that aside and to review Candidate Fiorina’s record with his usual neutrality and objectivity.1
Ms. Fiorina’s first management work was at AT&T and, after that oligopoly was broken up by the courts, one of its spin-offs, Lucent. She was deeply involved in Lucent’s program of vendor financing. A program by which Lucent loaned money to its customers to buy Lucent’s goods, instead of sending the customers to outside financing. When the economy is strong, it boosts corporate earnings; when the economy goes into a downturn, and the customers don’t pay all those loans, the company gets hit hard. Worse, the temptation to make sketchy loans to boost sales is very high. Under Fiorina, a lot of bad loans got made. Two years after she was gone and the technology sector collapsed, Lucent nearly tanked. Lucent laid off 50,000 employees in 2001 alone. Its market value plummeted from $250 billion to about $10 billion, and it survived only merging with Alcatel. Of course, Fiorina was gone by then, but the decisions she made contributed significantly to Lucent’s collapse.2
And then there is Hewlett-Packard. Yale Management Professor Jeffrey Sonnefeld called her time there the worst tech CEO performance in history. He was especially critical of “her ruthless attack on the essence of this great company,” noting that “she destroyed half the wealth of her investors and yet still earned almost $100 million in total payments for this destructive reign of terror.” And that’s without mentioning the 30,000 employees she laid off at H-P. WC thinks that her forced merger of Compaq and H-P is a textbook illustration of why you never, ever force a merger. And that her $21 million golden parachute is another example of her utter selfishness. Today, H-P is a shell of its former self.
From there, Ms. Fiorina entered politics, running for the U.S. Senate in California. She lost. Badly. By some 800,000 votes, in fact.3
So there’s her record. A series of bad decisions at Lucent. A series of even worse decisions at Hewlett-Packard. In both cases, decisions that nearly killed the companies. And a failed campaign.
Her defenses to these facts are largely non sequiturs. She compares herself to Steve Jobs, another fired tech executive. But Jobs came back to Apple and made it the largest corporation on the planet. Ms. Fiorina hasn’t worked in the private sector since being sacked at H-P.
Portfolio Magazine ranked her the 19th worst CEO of all time. The magazine described her as “a consummate self-promoter” who was “busy pontificating on the lecture circuit and posing for magazine covers while her company floundered.”
Not what WC is looking for in the President of the United States.
- For a given definition of “neutrality and objectivity.” ↩
- Ms. Fiorina also had a role in an ill-considered acquisition by Lucent of Ascend Communications for $22 billion. Some commentators have called it the worst acquisition in history. And she orchestrated another multi-billion dollar loss in a landline telephone joint venture with Philips Electronics. Fiorina called it the “biggest mistake of her career.” She is too modest. ↩
- Her campaign was insolvent at the end of her failed U.S. Senate bid. But she repaid herself the $1.25 million in loans she had made to her campaign. And stiffed staff and vendors. WC sees a pattern here. ↩