Mark Hurd contributes another 6000 unemployed to the global recession!

“All that is necessary for the triumph of evil is that good men do nothing”

On May 19 Mark Hurd announced Hp’s results for the second fiscal quarter to April 30th 2009 and, surprise surprise, the results were down on last quarter. Revenue slipped three percent to $27.4bn, and most importantly for this article Q2 net profit was only $1.7bn compared with $2.1bn the previous year.

Almost immediately, and probably just as predictable, HP’s CEO Mark Hurd announced that yet another 6000 HP employees would lose their jobs. That’s six thousand living, breathing, educated, tax and mortgage paying, children raising, men and woman, cast out into a world racked with recession and rapidly rising unemployment, because HP only made $1.7bn nett profit in the last twelve weeks, folks.

A prime example of the type of corporate behavior we have become used to, or at least been afflicted with for the time being, and Mark Hurd is a masterful exponent of.

For the sake of pragmatism there’s something we need to acknowledge. CEO’s like Mark Hurd are bound by a legal mandate to maximize returns to shareholders, in fact corporate law dictates that corporations maximize profits for shareholders. When you look at things from that perspective only, and giving credit where credit is due, Mark Hurd’s strong fiscal management is probably to be commended, the Q2 results could have been a lot worse. There is little doubting that HP is a much stronger company fiscally than it was before Mark Hurd’s tenure. But that’s all, and it’s not good enough.

I believe that this law of shareholder primacy, and the perpetrators that put shareholder returns ahead, and usually to the exclusion, of any civic responsibility whatsoever, is the root cause of the current global economic crisis. As a consequence it nearly undermined our western nations economic, and strategic, security, and our way of life. It needs to stop.

Lets face it, we all like to see our investments perform well, but many of us are smart enough to understand that more corporate profit is generated through the efforts of employees than by the capital of shareholders, we’re increasingly disgusted at the way employees are being treated in the name of profit, and some of us are not afraid to express our opinions.

Now, before I get lambasted from pillar to post for being a disgruntled ex HP employee, let me tell you that I’m not. My tenure with HP served me well, unlike some of the people I was, supposedly, responsible for. I’m not claiming anything more than a mediocre contribution to HP, and I’m now happy to be gone, running my own business, where I actually can make and execute decisions. We’ve employed several people in the past three months. I earn more, work less than I did at HP, and I travel business class. Hardly anything to be disgruntled about.

My fondest memories of the place go back to the pre-merger Compaq days, and the very early stages of the Compaq HP merger, when HP was still regarded as a top company to work for, and had some semblance of morality. It was exciting, vibrant, friendly, and we still had some degree of autonomy as managers. As the cost cutting that coincided with Mark Hurd’s arrival kicked in, and jobs started to go in their tens of thousands, either gone or moved offshore, I must confess to being suckered into all that "there’s no such thing as job security", "this is not a democracy", "if you don’t like it there’s the door" rubbish that comes with believing in the whole shareholder primacy travesty. Slowly, perhaps a little too slowly, I began to get the sense that we were just seeing a series of logical decisions that only added up to insanity. I realized that believing all that was naive and stupid, there was some seriously questionable stuff going on. Only problem was you couldn’t question it. I stopped caring for HP, or it’s Customers, a long time before I left. I don’t think I was alone.

So why are we putting the boot into Mark Hurd, or HP then?

Well, we could just as easily target IBM or a plethora of other companies laying off people right now. But, HP is not struggling, quite the contrary, HP is a highly profitable company sitting on cash reserves of $13.0bn having made $3.7bn net profit in the past two quarters, which is supposedly justification for cutting the salaries of the entire workforce, and putting off 6000 people, headed up by the $42 million per year man, the master perpetrator of the shareholder primacy travesty, CEO Mark Hurd.

“It is necessary that people work together in unison toward common objectives and avoid working at cross purposes at all levels if the ultimate in efficiency and achievement is to be obtained.”
…Dave Packard

The founding fathers of HP would be turning in their graves if they could see what their company has become under Mark Hurd. Sure, I agree that there was a strong need for fiscal reform when Mark Hurd came along but I don’t see why HP had to be turned into a black hearted, ugly beast who’s own mother wouldn’t recognize it. The strong fiscal discipline has come at the cost of HP’s heart, it’s inventiveness, creativity, and energy, and it’s soul , the HP shared values, the HP way.

Let’s take a look at some of these still published and much flaunted (and by that I mean rammed down the employee’s throats every six months through compulsory training modules) HP shared values. Here’s my commentary, feel free to contribute yours, keep it factual.

Passion for customers

We put our customers first in everything we do.

No you don’t. Nothing could be further from the truth (oh, except Mark Hurds 20% pay cut that is). Profit to shareholders comes first in Mark Hurd’s HP. I’d guess that there are people at the coal face who are struggling to uphold this value but are drowning with a lack of resource. A situation that’s only going to get worse with another 6000 people to go.

Uncompromising integrity

We are open, honest and direct in our dealings.

Is that right? Then perhaps Mark Hurd can answer some questions?

1. How come, after being prominent in the top ten companies listed in The Business Ethics 100 Best Corporate Citizens list from 2000 – 2006, HP disappeared from the list entirely in 2007?
2. Is it open honest and direct to stand up and pronounce to the world that you were taking a 20% pay cut, attempting to portray yourself as the magnanimous corporate leader you’re not, when it actually amounted to a mere 0.68% of your $42.5 million dollar package for 2008?
3. Is it open honest and direct to stand up and pronounce to the world in Q1 this year that cutting the salaries of the entire workforce by 5% would save 20,000 jobs, when the reality is that you are about halfway through the 24,600 job cuts from the EDS acquisition, and now you’ve added 6000 more? That’s 18,300 left to go then is it?

Trust and respect for individuals

We work together to create a culture of inclusion built on trust, respect and dignity for all.

Oh really? Then why is there anecdotal suggestion on this site that alleges one of Mark Hurd’s henchmen, Gary Budzinski, is waging a fear campaign against employees who, in their countries, have a democratic and legal right to vote yes or no in regards to whether you can reduce their salaries, and where any retribution is illegal, referring to them as class A or class B citizens and threatening consequences in their performance reviews? I bet Mark Hurd is pleased the video of that speech was pulled as quickly as it was eh? I’d hate to see that go viral.

Commitment to employees

We demonstrate our commitment to employees by promoting and rewarding based on performance and by creating a work environment that reflects our values.

Absolute rubbish, and it raises perhaps the most pertinent questions.

1. Why then did HP literally disappear off the Fortune Magazine top 100 companies to work for list in 2004, after being a regular for years. Why has HP never regained it’s place on that list?
2. Why then have I never seen a single word of concern, from Mark Hurd, for the very real damage he has brought to tens of thousands of people’s lives as a result of his actions?
3. Why then has there been a systemic reduction, and erosion of employee real wages, benefits, and working conditions since Mark Hurd arrived? And why is he being paid so much to do it?
4. Why are people loosing their jobs regardless of whether times are good or bad?
5. Why aren’t people remunerated immediately they are promoted into new roles, and why don’t they receive that remuneration for more responsibility even when the remuneration review occurs?
6. Why are you systematically replacing all the accumulated skill and experience with inexperienced, underpaid, of more often than not, mediocre staff?

Oh, and don’t throw us the old "internal surveys provide a more accurate view of the company than scattered anecdotes and reveal a satisfied work force" line like Mark Hurd did here. The HP Voice of The Workforce survey is at best a once in a year chore, and at worst a carefully crafted set of questions where the data is aggregated in such a way that if you ran it in a concentration camp you’d be saying the inmates are happy and think they’re living in a resort.

I could go on, but I’ll leave that to this blog’s contributors.

So, what’s the point of all this then?

It’s about jobs. It about raising the popular voice, to a shout. To demand employment in our own countries; an equitable balance between employee treatment and shareholder returns; job security; decent wages and benefits; collective bargaining and union representation in the workplace; and an end to the shifting of US, Australian, Canadian and European work offshore.

Right now, with our countries deeply in debt, caused by the whole premise of shareholder primacy, facing the prospect that we, our children, and their children will be paying that debt for generations to come, from tax revenue generated from jobs in our own countries. I believe we have the right to demand jobs from companies like HP, if we don’t then I would argue that HP doesn’t have the right to consume the earth’s resource’s, or market it’s products in our countries.

If Mark Hurd is to continue making people unemployed, if he is moving any jobs offshore right now, then he is part of the problem.