“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?
- 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?
- 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?
- 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.
- 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?
- 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?
- 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?
- Why are people loosing their jobs regardless of whether times are good or bad?
- 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?
- 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.
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“In a May 25 email, Mr. Runk called the problem his top priority. “I know the financial hardship this places on all of you,” he wrote to the sales force. “I regret these chronic and persistent problems with Omega sales compensation.””
Right, like those a$$wipes give a rat’s a$$ about anyone’s financial hardship. How about all those people who got 40% + paycuts, or the more than 40K people who lost their jobs?
I have to highlight the words from an HP spokesperson – that the salary realignment,” enables hp to effectively drive its pay for performance strategy with a consistent job-based foundation for rewards, development and organization planning,”
Now, how is that going to work? How is HP going to manage the pay for performance strategy? How are they going to determine who gets rewarded, and by how much? OMEGA?? HP can’t even properly reward their Sales Staff – a much smaller number of employees; probably a much smaller amount of data and criteria. How do you manage that for 300,000+ employees? The bonus/rewards/whatever has never worked in the 32+ years that I have been in IT, and it never will.
Mr. Hurd only has one thing in mind, and that is to overtake IBM and line his own pockets at all costs. He’s a rich man. This is just a game for him, and a very sick game for that matter. HP is in no financial difficulty whatsoever. They showed a profit of 1.7 billion in the last quarter. They have what, over $10 billion in the bank. They recently purchased a Network company, so that they can compete with Cisco. Mr Hurd is ruining the lives of the employees that helped bring HP and EDS success over many years (10, 20, and 30+ years), and through a very difficult recession.
He’s a sick man – Lock him up!!
BOOYAH!!! What goes around, comes around.
Lets try posting the whole article:
From the second page of today’s Wall Street Journal.
AUGUST 5, 2009
H-P Is on Quest to Fix Software Glitch
By JUSTIN SCHECK
Hewlett-Packard Co. urges customers to replace clunky, older technology with cutting-edge H-P systems that make businesses more efficient. But the technology giant itself still runs outdated software that has frustrated some of its employees.
Problems with an in-house system named Omega have kept about 2,000 of H-P’s more than 23,000 salespeople from getting their proper monthly commissions for much of this year, according to current and former H-P employees and recent company emails reviewed by The Wall Street Journal.
Omega calculates commissions for many salespeople in H-P’s business-technology group, which sells back-office computer equipment. But the system, which H-P inherited in a 2002 acquisition, has struggled to handle H-P’s growing mounds of data.
Omega has repeatedly malfunctioned since November, according to company emails which show that some salespeople have waited as long as seven months to get their correct commissions.
H-P has instead given some salespeople monthly payments equal to 60% or 70% of what they would earn for meeting sales quotas, according to the emails. It is common for a salesperson in the group to make more than $150,000 annually, said former employees and executives.
Omega’s glitches affect just a fraction of H-P’s more than 300,000 workers, and there is no evidence it significantly affects H-P’s business.
“You’d be foolish to think people aren’t frustrated,” said Al Chien, a sales executive who left H-P last year and is now at Dasher Technologies Inc., which resells H-P equipment.
H-P has had problems with Omega, a spokeswoman said, elaborating in a written statement: “We are in the midst of transforming every application in the company to rationalize 6,500 systems down to 1,500, but still have work to do.
“Recently, we experienced a glitch with one of those applications, which resulted in delayed compensation for a small percentage of our global sales team,” the statement continued. “We expect to have this resolved shortly and are committed to ensuring that all of our systems operate flawlessly.”
H-P started using Omega seven years ago when it bought rival Compaq Computer Corp., which itself inherited the technology from its 1998 acquisition of Digital Equipment Corp.
“Over the years, H-P has integrated many sales forces and inherited thousands of complex internal systems,” the spokeswoman’s statement said.
Mark Hurd
Such “legacy” computer systems, which get passed down over the years, are a familiar problem among corporations — including technology companies. Since he took over H-P four years ago, Chief Executive Mark Hurd has made a point of telling customers to update old technology. He highlights H-P’s years-long effort to modernize its own systems at a cost of more than $1 billion.
Omega’s delays result partly from H-P’s success: They have worsened as the tech giant has grown. H-P’s revenue soared from $73 billion in fiscal 2003 to $118 billion in fiscal 2008, when it also bought giant tech-services company Electronic Data Systems Corp. H-P’s product lines and sales channels ballooned, creating more data for Omega to digest.
Executives often discussed how to fix Omega, said Bob Bacon, who worked in H-P’s sales operation until last year. They “went to heroic lengths” to improve it, he said.
At a 2008 sales meeting in Texas, a senior vice president of sales, Randy Runk, took the stage and promised salespeople they would be paid on time, said a person who was in attendance. Mr. Runk and others at H-P involved with Omega weren’t available for comment, an H-P spokeswoman said.
H-P tried improving Omega with new software intended to ease how it processes sales data, according to company emails.
But after H-P’s fiscal year closed in November 2008, certain data in Omega were incorrect and incomplete, according to the emails.
By March, the H-P employees were apologizing to the sales force for delays. In subsequent emails this year, executives repeatedly promised to have Omega fixed soon. “We recognize the frustration this causes,” wrote H-P sales operations employee Bob Slaby in April. But each month the problems persisted.
In a May 25 email, Mr. Runk called the problem his top priority. “I know the financial hardship this places on all of you,” he wrote to the sales force. “I regret these chronic and persistent problems with Omega sales compensation.”
On June 8, Mr. Slaby emailed that Omega was finally on track. But four days later, he wrote to say, “The system encountered a production failure that has delayed our progress.” In the meantime, he added, “We sincerely appreciate your patience.”
Write to Justin Scheck at justin.scheck@wsj.com
Printed in The Wall Street Journal, page B2
Here are a couple of recent articles about the job codes and the additional 30% pay cut for US employees…
http://www.dallasnews.com/sharedcontent/dws/bus/stories/0805dnbuseds.aed50dfe.html
and made the tv news: http://www.nbcdfw.com/news/local-beat/HP_s_Huge_Salary_Cuts_Forcing_Out_Old_EDS_Employees_Dallas-Fort_Worth.html
Here are a couple of articles about HP cutting salaries of EDSers that you might want to check out. The original article was at the NBC affiliate in Dallas, Tx and later ZD Net reported based on what the NBC affiliate had reported. The ZD Net article doesn’t have too many comments but the NBC article does. Maybe we can drive some more traffic and attention to these articles….
“HP’s Huge Salary Cuts Forcing Out Old EDS Employees”
http://www.nbcdfw.com/news/local-beat/HPs-Huge-Salary-Cuts-Forcing-Out-Old-EDS-Employees-52485672.html
“Reports: HP cutting more EDS salaries”
http://blogs.zdnet.com/BTL/?p=22295
Some of the comments are well worth reading. Good points on both sides of the argument.
Any news from AsiaPac HP? Any job cuts? apart from 5% Salary cut.
Regs
Fighter
HP is a responsible corporate citizen
http://www.itworld.com/tech-amp-society/73389/hewlett-packard-responsible-business-award-goes-project-my-world
I have found Damian’s initial article and all the following responses interesting. It appears that a good many of the replies are from folk not living in the US. I live in MI and worked for EDS for 10 years before I received my “walking papers” last December. However, even before the buyout, all the comments made regarding HP could have been made of EDS and I’m beginning to think it is true of “Corporate America” all together.
EDS kept touting their rhetoric regarding “People Care”, how we – the employees – were their most important part of the company. In the last five years of my employment with EDS, it became very evident they were just spouting words, because there were no actions to back it up. Even with glowing performance reports, I became very familiar with the little “side shuffle dance” when asked when and why I had no salary action (raise) coming my way. It was usually “a freeze on salary raises” or some such reason. I worked in IT, which was treated entirely different from the Sales departments. Put an “S” in front of the word “HIT” and that is how we were treated. The demands on our time for work became something like 25 X 8. There was no longer anything similar to a 40 hr. work week and we were very rarely compensated for the sacrifices and hard work we put in project after project. It became “expected”.
When HP bought EDS, we were told that there would be a workforce reduction of 24,500 jobs over three years – another BS story. It really became apparent that a “Chop Shop on EDS” was in place, and it was happening within a years time frame – not the 3 years that was initially communicated. Of course, there was no rhyme or reason to those selected – EDS was already at “bare bones” – because it had nothing to do with being on a billable project (that was my case – my project was billable into mid 2009 and I was the team lead) or being “dead wood”.
To this day, however, after the initial shock and hurt of being let go, I realize how blessed I am. I knew that day I would not be working until the wee hours of the morning to make an inhuman project deadline – nor would I have to the next day, or the next…
I was given 60 days to find another job within HP or EDS, an HP company, but I didn’t bother. I knew I did not want to go back to a job that took my soul and gave nothing back. I am now looking to jobs in the private sector as they appear to have the employer to employee loyalty relationship in place and back up their “People are our best asset” with the actions that used to exist back in the 1980s.
I honestly feel sorry for the people still working at HP or EDS, and HP company because I know it has only become worse since I was let go. I do not miss it for a moment. My life is once again enjoyable to live and I have balance between work and life outside work. I can not believe “we” (employees) have rolled over and are taking what is being dished out to us. What happened to “we the ‘grunts (basic employees)’ uniting and saying “WE WILL NOT TAKE THIS ANYMORE”"?
If there’s ever been a time for protest, taking action – revolution, I’d say the time is NOW!
Or, we can continue to lay down and “take it”….it’s only going to get worse.
Has anyone else been explotated by the job code changes?
William Shatner (Chaptain Kirk) and Greenpeace ask HP to live up to promises made about use of toxins in HP products.
http://www.greenpeace.org/international/news/hp-reminder-28-07-09
Several EDS OSers in Germany will be leaving EDS (an HP company) today. An agreement reached between management and the works council after the strike was that up to 500 people would leave, with several incentives for those agreeing to leave voluntarily and that mgmt could get rid of up to 300 people (maximum) but if more volunteers left that was less people that mgmt could kick out. I’m wondering how many will be leaving today and what the company will look like with all those people gone. To those leaving us today I wish you all the best.
I just left HP on my own after a 9 year stint. Bravo Damian for the work you are doing. I am boycotting all HP made products and services. HP and Mark Hurd benefit from fear and spreading FUD. 42.5 million and you claim you took a 20% pay cut? Sorry. I will not reward this behavior. I will not bring kids into the world to work in the modern day hacienda. I am in the process of making competitive solutions to HP products for their soon to be ex enterprise customers. The world outside of HP is a much healthier place.
Same goes for me…In my new job outside HP, I dissuaded all my customers from buying HP, citing poor service, etc to them.. To be honest, I won’t want to be near an HP machine anymore!
Anyhow, the world outside HP is alot prettier than within the abyss of HP…5 months since leaving, I count that as my bestest decision ever.
I heard an interesting rumor! Good news, downsizing has been slowed at HP. The reason is, so many people have been quiting that people have been getting recycled in to other jobs. The rumor is that over 500 people were placed last month!!!!!
It’s only thinly disguised as good news. The reality is that employment conditions in Mark Hurd’s HP are so bad that people are leaving in droves (and he doesn’t have to pay them out), probably only slowed by the current employment market being tough. Equilibrium will be achieved sooner or later and the investment word will wake up to a seriously diminished HP, where the expertise is gone, and service is third rate.
I was being sarcastic! The good news is people are wising up and quiting!
HP is at it again. The recently announce the “alignment” of job code between EDS employees and HP’s job codes. The results? If you are above the salary cap for HP’s job code that you are placed in, you take a pay cut. Some people are facing cuts of greater than 20%.
If you are below the bottom of the job code’s salary range? Nothing. No pay increase to “align” you.
There is no “alignment” here. Just another scheme to bilk employees out of their salary to feed Mark Hurd’s greedy appetite.
My EDS/HP job code “alignment” happened 7/31 (funny how they always seem to do their dirty deeds on Fridays). In addition to the recent 5% paycut we took and then the 10% temporary cut in June, they are now going to cut my pay an additional 25%! This has got to be the most humiliating, insulting experience of my IT career. Despite losing over half of our group, I have not ever missed an SLA or ever even had a mediocre performance review, all have been excellent or exceptional. This company has the nerve to say they “work together to create a culture of inclusion built on trust, respect and dignity for all”…What a joke! This so called “alignment” is unfair and an absolute ATROSITY built on lies and greed.
This company does not value its employees, just how their numbers look. This ‘alignment’ is nothing but the latest smoke screen for yet another pay cut. In addition to this, the layoffs continue as well. What goes around comes around! When this economy picks up, I predict there will be a mass exodus. If you aren’t currently looking for another job, you need to start.
Are you absolutely sure they are reducing your pay, or are they just adjusting your job’s position in the pay bands?
Yes, the pay is being reduced in the realignment. No upward realignment; only a downward spiral further into the rabbit hole.
Hell hole
They say they are adjusting our pay to the “pay bands”. But amazingly, the pay is only being reduced. No one’s pay has been increased if it is below the band. Also, some of the job codes/titles that some groups were aligned to are highly dubious. Jobs at EDS that were highly technical are now matched to “technical services” roles, which are not much more than service desk titles, with service desk pay to match.
I’d like to hear from anyone who has had a salary increase as a result of this “realignment”. I bet you are right – no one gets a raise.
I receieve HP’s management communications and believe me, the only mention in them is how to handle employee’s responses to pay reductions. That’s what it’s all about. Adding insult to injury, some of the “coaching notes” basically tell you to refer the employee to Employee Counseling Services if they’re really upset.
My senior managers comment was that we tell staff to like it, lump it or leave. Personally, I’m leaving. 3rd interview next week, position pays more than my EDS salary before the HP 5% reduction. Wish me luck!
I found this article dated Nov 2008. Someone tried to kill himself because he got retrenched. This goes to show how bad things are getting in Mark Hurd’s Huge Prison…
http://www.zdnet.com.au/news/business/soa/EDS-black-day-as-worker-attempts-suicide/0,139023166,339293418,00.htm
Colleagues at EDS Germany have now gone back to work after a period of strike action. EDS-HP have made concessions to staff based in Germany (I don’t know the detail).
Proof that the only constructive dialogue that rank and file employees can have with Mark Hurds HP is through withdrawing labour.
Strike action is coming to EDS UK. I would urge all my UK colleagues to get involved by either joining the UNITE or PCS unions.
http://www.unitetheunion.com/sectors/it__communications/unite_in_your_company/unite__hp-eds.aspx
http://www.pcs.org.uk/en/commercial_sector/eds/index.cfm
Together we can put an end to this nonsense.
In addition to my prior comment, if you see the “Big Picture” you’ll notice the pattern.
Is like a balance, First world countries no accepting the 5% paycut while Third world countries accepting it (even though our salaries are being automatically reduced by economic forces like constant devaluation). Basically you’re telling CEOs in general from all Global Companies to keep laying out your jobs to the 3rd world. At the end you’ll have to accept poverty and enslavement this is where we’re heading, the so called New World Order. A new system of human enslavement. Sad :’(
The even bigger picture is that consumers like me, business owners who invest in IT products and services, become extremely annoyed with the abysmal service we receive from 3rd world centers and boycott companies like HP as a result.
The other difference is that we have always had the choice between poverty and enslavement, or freedom and prosperity, and we have chosen the latter. Our ingenuity and tenacity as a society, our voice, and our actions will result in companies like HP being shunned in favor of businesses with high integrity who employ people locally. As far as my business is concerned HP is blacklisted – we don’t, and never will, need them.
Damian,
I am not sure about your assertion”we have chosen the latter”. What I see in HP North America is that we did not have even the option to reject the salary decrease; we had to accept “as is”. The reason why companies like HP can proceed as they want is because there is a sickening feeling among IT companies (in their benefit) that having even thinking about having a professional Union to protect our rights, is just unthinkable and despicable. For an unknown reason any action related to an Union is seen suspiciously. People in the IT industry in North America have being educated that UNION = sin = unfaithfulness, which is the perfect equation for our magnanimous employers. (This kind of social submissive behaviour is unacceptable in the majority of European countries for historical reasons).
So, as I mentioned above not sure if your statement corresponds to the reality at the present moment.
Yeah, I can see it from your point of view, but I am in Australia, a working democracy where, although seriously challenged by the previous government (to their demise), collective bargaining (often facilitated by unions) is a right, a right that is not skewed by some bogus “red under the bed” bullshit that has been fostered on you guys by generations of silver tails who use it to exploit you.
The one thing that would keep Mark Hurd awake at night would be the fear that the US workforce wakes up to the fact that collective bargaining, with the threat of withholding labor, gets results in favor of the employee.
You can see how seriously disadvantaged you US employees are because of this belief. You’ve been brainwashed. Get over it, and do something about it.
Given his preoccupation with shareholders can you imagine how much pressure you could bring to bare by walking out in unison with strong negotiators leading the charge?
If Mark Hurd was in fact ethical, if he had any honor, there would be no need for unions. Unfortunately that’s not the case.
Isn’t it ironic that, in the land of the free, you are not free to bargain as a collective in the US IT industry?
I’m living the opposite side of the situation you’re living. I’m a HP Employee in a Third World Country (I’d rather prefer no to mention where I’m living), we also were told to vote to choose either to accept or no the 5% reduction, while at the same time were told these economic times are really tough, difficult. We’ve seen lots of layouts in the country in general besides unemployment and poverty is HUGE in this kind of countries. Our currency has dramatically felt by 30%, thus making us even more cheaper, actually our salaries by this simple fact was reduced automatically by 30%. Our coin was about 10 per 1 dollar, about 0.1 dollars now it is 14 per 1 dollar, about 0.07 dollars. In addition to this situation we were asked to take the 5%, while most of the prices in general for everything were growing since my country doesn’t produce almost anything with national brands, most of the brands are from US companies and then the prices are based in US dollars.
Here most of the employees are accepting the 5% reduction, even most of us probably won’t have enough money to live well, probably we’ll be using more our credit cards and then increasing our debts even more and then (ergo) devaluating more our currency due national debt. Many people have a real fear of losing their jobs because if you loose this underpaid job probably won’t find any job outside. So also we were told that many opportunities could be arriving at HP (the company) to this side of the world, most of the jobs you’ve been losing would come here and this could represent great opportunities of having a better standard of living. So basically most of third world countries people think: “If we accept the 5% reduction we could get a better job from first world lost jobs”. Since many of the Fixed Costs of the company are in Third world countries, the company is calculating actually a 2-3% of effective savings. A 2-3% of increase in MH millionare bonus.
Yes, there’s the dilemma, we certainly wish continued prosperity on the so called 3rd world, but not at the cost to our own.
I am an ex-HP employee from Melbourne, Australia.
I just left HP beginning of this year, and although based on my manager’s annual performance review evaluation i reached the highest score among all my colleagues, apparently my yearly bonus was never planned to be given out to me. The reason is simple, i quit the job in January, whilst the evaluation took place in December to evaluate year 2008 performance. Where the heck did my bonus go? What’s the point of sending a piece of junk email to my inbox saying that I’ve exceeded what was being expected from me, but i know someone else took my bonus away from me.
Now, i agree with all Damian Saunders wrote on his blog. Please, SOMEONE SEND THIS TO MARK HURD, let him read this blog and let this ‘greedy tool’ know that everyone hates him!!!! grrrrrrrr
It’s pretty obvious to me that your bonus went to Mark Hurd himself.
I know from experience how disheartening it can be for a manger. Despite their best efforts at times to follow the company’s guidelines for performance reviews the slap in the face comes when the Mark Hurd machine spits out a number that no matter how you divide it up can’t be fair.
Managers, or line managers, have no input into their own bonus either and usually find themselves in the same boat as you.
I personally recall receiving a budget of $1100 to split amongst something like 14 people. It’s certainly a gut wrenching situation to find yourself in, especially when those people were overdue for remuneration increases due to promotions (in some cases two promotions) and deserved better.
Take a look at this short video: it sums up HP’s approach to the EDS acquisition:
HP Restructuring EDS
Working for EDS Netherlands; I recently had a talk with one of our HR managers.
We also had our 5% paycut recently. This HR manager told me that; 4 days before the deadline; so far 2 people (out of about 1,300 or so) have accepted this paycut…or in other words; about 99.99% is showing a clear message to our beloved Mark
2! That’s so very good. If this the same in every nation in Europe it show a very strong message. If only 2 accept then Mark should not implement for anyone. Anyone know about the rest of Europe? Maybe we can ask GARY BUDZINSKI as he will be watching or so he say. Why is Gary still in HP?
Ha ha. On the company external Ethics website I found the following statement:
———-
The board has ten members, with Mark Hurd serving as chairman, chief executive officer and president. The other nine members are “independent directors.”
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I have NOT added the quotes, this is verbatim. King Mark and his band of yes-men!
A sense of humour or a sly protest from the PR folks?
I loved your article – you say so many things I want to say only more eloquently. I am an EDSer and have been asking questions about ethicality of the company’s behaviour without any result. Three more points to add to your article about Corporate Ethics:
1. Is it right for a company to self-regulate its ethical behaviour? If I raise an Ethics Violation against HP, I know it will be rejected, and probably followed by an instant dismissal, because the body that decides on ethical behaviour is chaired by the Unethical One himself! It’s a bit like asking Adolf Hitler if it was ethical of him to invade Poland.
2. Last week we were all “invited” to accept a pay cut of 5% (“for the good of the company” was the phrase that appeared in a global communication shortly before the actual invitation was sent – to tempt the masses). I have written confirmation from the company that, if I (or anyone else) accepts a pay cut, we will STILL not be protected from any compulsory redundancy! In my opinion, this “invitation” to accept a pay cut is an act of grand deception: there is no reference in the invitation to employees on what they will get in return for their sacrifice. I would have appreciated some honesty in the invitation eg., “In order to reduce our costs of making you redundant, we would appreciate it if you would allow us to reduce your salary by 5% and, by the way, your pension will also be reduced by at least the same amount thereby saving us even more money.”
3. One observation from an “All-Employee Meeting” held on June 17th and hosted by Anne Livermore, Senior VP of Technology Services Group (that has absorbed EDS) and several other senior HP and EDS Leaders. Much of the meeting focussed on the “exciting opportunites” that abound in HP at the moment in relation to the “cost structure optimisation” initiative. Well, I am sorry to say that I was not very excited at the prospect of having my “cost structure optimised” because the only opportunity that this would present is to see the dole queue for the first time in my life. The meeting reminded me of a group of little schoolchildren running around the playground with a new toy – in this case, a toy that resembles an “automatic mugging device” – and wondering why no-one feels as excited as they! The whole show was an excellent demonstration of “Corporate Asperger’s Syndrome” (inability to empathise with others). The scariest part of the meeting was when Robb Rasmussen announced, hardly able to contain his excitement, that there will be a 10% year-on-year cost reduction target FOR EVER. So, all HP employees can look forward to redundancies continuing indefinitely with nothing in return. At the same time, there is a second Corporate target to increase revenue – so HP plans to grow revenue and cut costs (through redundancies) for ever and ever. Taking these targets to a logical conclusion, HP will grow and cut costs to the point where it has no employees left to sell the products or deliver services. Talk about “cloud cuckoo-land”!
I would urge your readers to test HP’s ethicality by reading the false claims that the company makes for themselves on the publicly-available site here:
HP Ethics Site
Readers can report ethics violations from this site. If enough of us submit them, then they will listen – or at least be forced to respond.
Yeah, exactly right about Mark Hurd’s so called ethics.
I believe, and I think it’s obvious, that in Mark Hurd’s world, the word ethics is misused, and what he is doing is merely compliance, like; what do we need to do to make sure we’re operating just on the right side of the law in each country we do business, so we can get away with being completely unscrupulous, whilst playing lip service to ethics.
The word ethical implies conforming to accepted standards of social or professional behavior. That is such a nebulous definition really isn’t it? But, I think we are the ones who determine socially acceptable and we have a responsibility to call Mark Hurd on it. A company that publicly professes one set of values, then operates in direct contradiction to those values, is not being ethical at all.
Wankers like Anne Livermore have been spouting words like “exciting opportunities” like parrots for years. Exciting opportunities like what exactly?
The “exciting opportunity” to work your way up in the organization, but not get a pay increase for the promotion despite having to work more and take on more responsibility?
The “exciting opportunity” to work for 12 hours and get paid for 7.5?
The “exciting opportunity” to know that you could loose your job any day simply because the numbers didn’t add up and you were next on the list – the so called “dead wood” is long gone?
The “exciting opportunity” to work as a manager when you have absolutely no autonomy whatsoever and are merely executing decisions that were made for you and without regard to your input. To work in management teams filled with “survivors” when those people with any real management, leadership or entrepreneurial zest have long since left in disgust?
The “exciting opportunity” to work as the public face of HP when the service quality has gone down the toilet due to offshoring, with the subsequent loss of true expertise and experience built up over years.
The “exciting opportunity” to take a pay cut despite the company being extremely profitable and sitting on billions of dollars in reserve cash?
The “exciting opportunity” to see your executive getting huge bonuses and obscene pay checks in reward for you being exploited, having the real value of your salary diminished, for contributing towards the economic hardship your country is experiencing by adding to the unemployment rate, and diminishing the available job pool?
…and so on…no thanks
At the Hurd level it is a simple equation, ethical = legal. If it is legal it is ethical. And so it is with layoffs, if they can do it legally, remaining inside the law with respect to WARN, age discrimination and so on, they will do it.
The reason HP, or any other such organization, enforces their ethics on the workers is to serve executives directives on controlling the work force. By having the workers act ethically it gives executives the leeway to act unethically, not having to worry about the underlings. And at the same time executives use the ethics policies as a publicity tool to the press making Wall St. believe that it is an upstanding company, worthy of investing.
As an upstanding citizen, I would always take the ethical path, and I believe the vast majority of us would. Begs the question of the few at the executive level. Does one need to climb the unethical ladder to reach the top?
the so called “dead wood” is long gone?
Unfortunately this is totally incorrect. The “dead wood” has however been confined to executive offices.
Good point…I overlooked that didn’t I?
Why do management types assume that average employees care about Cost Structure. We care about doing our job to the best of our ability while using plain English. Cost Structure Optimization? You’ve got to be kidding me.
And why does management seem to attract the sort of people you really don’t want to spend any time with inside or outside of work. It seems to attract insufferable little bullies with insecurities which they attempt to tackle through bullying. Now, there are some excellent managers, even in HP but the number of idiots with MBAs has increased dramatically.
Dear managers,
Please could you give two presentations in future. One in plain English for 80% of the workforce and the other in business double-speak for your playground bully clique.
With thanks,
Everyone
In closing. I don’t know of anyone in UK&I that accepted the pay cut! Up yours HP
Geoff
(awaiting the next round of workforce optimization)
As any reader of this blog in the UK will know we got our email offer to take a 5% paycut this week. I am happy to report that I’ve not heard of one person who is even remotely considering a “YES” response. Looks like the workforce in the UK are standing up for themselves… at last!!!
I think everyone who works for HP UK, and probably EDS for that matter, realise that WFR (work force reduction) is now going to be an ongoing part of working at HP, and each one of us has to take the stance that if we get WFR’ed then we’d be as well doing it without getting a cut of 5% upfront.
Great news, I’m looking forward to hearing the outcome of this ‘vote’, looks like it might be a collective ‘up yours’ to Mark Hurds greed.
I’m sure that this will be the case Damian.
Morale is currently very low in the UK, and plunged deeper when people saw the comments made by Gary Budzinski (HP Services VP) when he said that he would be tracking down and penalising those who say “NO” to the 5% pay cut. Maybe in the US Gary, but you cannot get away with this behaviour across the EU. I’m sure Mark Hurd would have wrapped his knuckles for those comments, before swiftly editing the internal webcast – that says it all for me.
Sorry – as well-written as I’m sure your post was, I just couldn’t get past this idea that you somehow have a right to a job. In fact, near as I can tell, you basically write everything from the standpoint that you have some dubious set of rights that you really don’t have.
Why doesn’t HP have “the right to consume earth’s resources?” Are those resources owned by you?
Thanks for calling me on this, as I said at the outset this is just my opinion, and I welcome debate. I have to say I’m quite pragmatic when it comes to the right to a have a job, I believe that, in reality at this moment, that we don’t actually have a right to a job. That’s obvious. But, my question is why not?
I find it quite ironic that, when the foundation of world trade revolves around people’s ability to consume, using money they earn from jobs, that there is no basic human right to a job.
I find it ironic that when the whole premise of our society is to get a good education so that you can go on to get a good job, that when you finally get there you find you don’t actually have a right to a job at all.
I find it ironic that we have one of the world’s largest economies, California, on the brink of issuing IOU’s because it can’t make it’s financial commitments, due I would assume to a large extent to falling state revenues from unemployment, with another 30 states close to doing the same, that we allow the Mark Hurd’s of the world to get away, not only putting off tens of thousands of people, despite being highly profitable, but actually reducing the available job pool buy acquiring and devouring other organizations, with impunity.
You’ve raised the “Atlas Shrugged” scenario, or rather you’ve pointed us to a link as if to say there you go, enough said. That’s a whole other conversation, but you have to remember that Atlas Shrugged is a work of fiction that conveniently sidesteps reality in order to further Ayn Rand’s ultra capitalist philosophy – which I find extremely interesting and was quite passionate about at one stage – and deals with Government gone crazy to the detriment of entrepreneurs. The situation we find ourselves in right now though, is world economic collapse caused by the unregulated free market – the entrepreneurs themselves – indicating that these people can’t be trusted with, and don’t care about, our security when left to their own devices, and that there’s some middle ground between Ayn Rands world and an equitable reality.
As far as some “dubious set of rights” is concerned, I think that the right to fair and equitable treatment as an employee is not a dubious right at all, in fact HP’s published Corporate Values imply that very right. I’m just suggesting that the current HP executive under Mark Hurd are not living up to those values.
Everyone owns the worlds very finite resources – our economic say is our consumer dollar, I’m suggesting that the dollar is spent with companies who have a better track record of treating people fairly, otherwise the consumption of those finite resources is of no socioeconomic benefit to the world as a whole.
I think the issue is a ‘right to respect’. When you devote yourself to a company, and the company is VERY profitable, the company owes you respect, they owe it to you to live up to promised salaries, they owe it to you to live up to a promised retirement. Now if a company is going down then some rules get thrown out, BUT a company doesn’t have a right to award a ceo $40M in bonus while cutting employees salaries and cutting employees levels down to a number where it will be difficult for the company to develop new products for the future – all while making an excellent profit. They also don’t have the right to tell a group of employees they are cutting their salaries an additional 10% for a month so that they can reach double digits profit levels!
Thats why unions are needed, so workers can demand their ‘right to respect’, and if that includes a ‘right to a job’ so be it.
I think Damian is helping bring out many incoherences that are inherent in the present system.
For example, off-shoring hp’s US jobs is a good thing as it increases shareholder value by reducing the overall wage bill…but at the same time, the news yesterday was full of the bad news that the US employment figures are worse than expected. Pushing the “logic” to its extreme, hp could off-shore all US and european jobs, and leave just a handful of people in an office in Delaware. This would massively increase shareholder value by slashing operational costs… but it would have an impact on many communities in the US, particularly due to the knock-on effect on indirect employment, and at the same time remove many potential customers from the market. The US car makers could probably turn themselves round and become very profitable by off-shoring all production activities – but at the same time the US wants to protect employment and buy products manufactured in the US.
Many sites – Boise, Corvallis, Fort Collins etc – were originally manufacturing sites employing many tens of thousands of people. These sites are currently virtually empty and the manufacturing happens off-shore. This has certainly helped profitability, but at the same time has had negative impact on the cities concerned, especially as the knock-on effect can add several non-hp jobs to every hp job lost.
As another example, hp in the US, France, Germany and the UK have been very heavily hit by job cuts – but these are the countries that generate the greatest number of patents worldwide. How does this tie in with the companies stated aims of producing innovative products?
I think it comes down to a debate around the role of a company in society. On the one extreme there’s the US model that says that shareholder value is the only raison d’etre of a company, on the other extreme there’s the communist model where the state owns and controls everything. For me, the ideal model lies somewhere in between.
The idea that shareholder value is the sole driving force for a company comes from a time when the world was very different – the infamous Dodge vs Ford case, which is often quoted, took place in 1919. Is the conclusion – that a business corporation is organized primarily for the profit of the shareholders, as opposed to the community or its employees – still valid 90 years later? Personally I don’t think it’s valid in the current global economy.
ok, well thats a simple statement that doesn’t really have any substance, you saying we don’t have a right to a job. Basically you are correct a person does not have a right to a job. But the reality is, since medieval times in Britain, people have worked for other people, been paid for this and that it how farming, industry, engineering, finance, IT and retail have evolved over 1000 years. Without people having jobs and working for others, this doesn’t happen!, economies don’t work as we understand them to do today.
Now the people employing you need ‘you’ or at least ‘someone’ and you need them!. When the boundaries are moved (and at this time they have Globally) and the employer looks for more and more cheaper ways of getting work done, then workers over time have tried to stand up to this action aswell as for human rights, a fair days pay, health and safety, good working conditions etc, all things that have made for a better quality of life.
Now we either all work for ourselves or we work for companies. The companies have to look after their workers this is the right thing to do, it is the right way for the democratic society we live in.
Going off track, but lets take this a bit further, did the young lad that died the other day in Afghanistan in the war have a right to a job? Does the Nurse and Doctor that might keep you alive one day, have a right to a job? Do they have a right to work in modern hospitals paid for by other hard working peoples taxes, i.e people that work for other people. Did the millions that died in WW2 have a right to be paid for what they were doing so that evil was defeated and you are here today to breath the free air that they gave you with their lives. Would the shareholders and the execs be here and be very rich today, if the young soldiers hadn’t had a right to a job, be paid and give their lives for you. No they wouldn’t.
I’m trying to put this into perspective here, people are losing sight of where we have come from and how we got here, that probably doesn’t matter to you, as you obviously think we don’t have rights. You probably think interventionism is bad, well if a lack of interventionism is how we are here, in the economic state we are in today, then perhaps we need more.
It’s a very simple statement that you made, and as I say, doesn’t really mean anything, but what we do need is for companies who are registered and based in the UK, to have an obligation to look after their workers through good times and bad if possible. BT is a prime example, they once made billions, now they are losing billions but looking for ways of retaining staff through the recession. They are offering to some 25% salary for a year off, short time and other methods of keeping staff and cutting costs.
There are couple of old sayings you might of heard – ‘you look after your own first, then look after others’ and ‘don’t cut off the hand that feeds you’.
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.
OK http://en.wikipedia.org/wiki/James_Taggart_%28Atlas_Shrugged%29#James_Taggart
I like your reference to Atlas Shrugged but what’s your point in relation to the quote?
My position is that the quote itself is pretty out there, but it’s certainly a catalyst for debate.
WASHINGTON (Reuters) — U.S. securities regulators proposed requiring companies to tell shareholders more about pay policies and board members’ qualifications amid public anger that lax corporate oversight allowed top executives to take excessive risks.
The Securities and Exchange Commission voted on Wednesday to require companies to disclose more information about directors along with more details on how compensation policies can create incentives to take unwarranted risk.
READ FULL ARTICLE:
http://money.cnn.com/2009/07/01/news/economy/TARP_SEC_wants_pay_input.reut/index.htm?
We in UK have been told that they are cutting us down to 3 from 4 (after reducing us from 9). Has anyone details on the selection criteria being used for Compulsory Redundancy ?
All these layoffs are really showing up in the quality of HP products!!! I was told all the EDS employess got an email telling them to back up to make they back up their HP (specifically) laptops often as there has been a lot of failures lately. The EDS people who are used to using Dell laptops haven’t had to worry about this before (not to say it wasn’t a good idea to though).
As a long time HP’er I guess I’m used to it now…
I do not beleve Omega is broken I beleve Omega is working exactly the way the HP Executives want it work .
They are saving Millions in not paying out commission $$$$ to the sales force
Heres ethics reform the HP way :
[comment has been edited because it contained the original HP confidential email in it's entirety. In the email Randall C. Runk Senior Vice President- US Sales was quoted as saying...]
Rest assured that in my quarterly analysis of Mark Hurd’s HP, due soon, we will be putting HP’s so called ‘ethics’ under the spotlight.
HP’s is one of the most Un-ethical companys I’ve ever been associated with the Greed and contempt of the executives for the workers is unfathomable It would be good to see the light shine on the Executive miss-conduct and unchecked greed I only wish the govenrment could do something
I’ve been thinking about the new business model that’s emerging:
- the company doesn’t provide premises for all employees, so the employee works at home and, depending on the country, may not be compensated for using their own equipment and space
- the salary model includes a variable part that is often outside the control of the individual and is determined by an opaque forumla that only the company knows.
This is getting back to the outworking model of the 18th and 19th centuries, where individuals used their own premises to make items for a middle man or business, and where they had no control over the price they received. As on-site networking breaks down, the individual becomes increasinlgy isolated and vulnerable. These are some of the factors that led to the creation of trades unions. Countries that have strong unions are far better armed against this new business model: those, such as the US, where unions are extremely weak are prime candidates for a resurgence of trades unionism.
Wouldn’t it be ironic if the extreme version of capitalism that Hurd and others practice led to the resurgence of a highly-unionised workforce…
This is the crime that is being perpetrated on a so-called democratic society.
Yes, but how do we, the majority, react to the abhorrence?
We continue to vote for right-wing parties due to fear of the what the left will do to undermine our market economy.
We believe the propaganda about competitiveness and the need for tax breaks and incentives for those rich beyond meaning.
We hate, but support unconditionally, pampered pigs like Mark Hurd.
My friends, only through voting for change, with the courage of our convictions, will we break the spell of avarice.
Vote for change whatever your country or culture.
Vote for those who will go back to post-war prosperity and reasonable equity for all.
Vot for your children’s future, slightly more free from the hateful gluttons personified by that pig-dog Mark Hurd. Remember – he exists because the majority voted badly and supported puppet governments amenable to his cause.
Wake up, bitches.
Roosevelt.
It’s ironic really isn’t it? Your so called Market Economy nearly brought the western world to it’s knees.
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