HP History: 1992-1999 - The Lew Platt Years

John Young retired from HP in 1992. Lew Platt was CEO from 1992 to 1999. John Young was an engineer who graduated from Oregon State University with a BS in Electrical Engineering. He had joined HP in 1958 on the marketing-planning staff. Lew Platt had a BS in mechanical engineering from Cornell, joined HP in 1966 and worked in the medical products operations. He later managed the Analytics Group and various parts of HP's computer business. As a long-time HP employee, Lew understood the HP Way and made it a core part of his leadership.

Although John Young was still CEO for a few months after I joined HP, Lew Platt was CEO for most of the first half of my HP career when I was writing software and then was a first line project manager. One thing that characterized those years under Lew was stability. If there was turmoil in the HP boardroom, we didn't hear about it or read it in the press.

In 1997, Lew Platt said this in an article in Directors & Boards entitled "Governance the H-P Way."

"A good test of whether your board is functioning well is if you can answer 'yes' to the question, 'Do I feel free to discuss anything with my board . . . to talk with full candor about anything that's worrying me?' I feel fortunate in this regard. Not all CEOs can say the same. For one reason or another, something goes wrong with the relationship between the CEO and the board, or between company management and the board, which leads to secrets, to a lack of trust, to poor board performance, and ultimately to poor corporate performance. My board has been very helpful to me with its perspective and advice, and our candid dialogue takes place in an atmosphere of mutual respect, which is the key to having a good board relationship."

Under Lew Platt's tenure as CEO, HP's sales went from $20 billion in 1993 to $47.1 billion. Platt was known as an embodiment of the "HP Way." He was known for being connected to HP's employees as he practiced "management by walking around" and flew commercial airlines instead of using the corporate jet. He regularly ate in the company cafeteria with employees. Late in his tenure, Platt was often criticized by investors and some HP executives for focusing on progressive values and long term results. Platt's detractors said that company needed a more cold-blooded competitiveness and higher octane leadership to succeed, that his "pragmatic, nothing-fancy approach" seemed out of touch with the demands of the late 1990s.

In a 1994 speech, Platt said that in a time of rapid and turbulent change, "You must anticipate that whatever made you successful in the past won't in the future. Fear of complacency is what keeps me awake at night. Senior management's role is not to tell business units what opportunity to take. Instead, our role is to create the environment that encourages business managers to take risks and create new growth opportunities. In other words, vision at HP isn't a straitjacket that constrains our managers, but rather a view of the many opportunities ahead." Despite this philosophy, one notable problem was Lew Platt's failure to capitalize on the Internet boom of the 1990s. He believed that HP needed to focus on computing businesses.

Platt, who had announced in March 1999 that he intended to resign and spin off HP's test and measurement group into Agilent, said in a July 1999 interview, "even before the announcement of the splitting of the company and the new CEO, we had spent a lot of time looking at ourselves. We needed to make some cultural shifts." Platt said, "We needed to hold fast to the core values but change some of the practices. (We needed to) speed up decision making."

But things were about to change at HP and in the HP boardroom when HP chose an outsider, Carly Fiorina, to be CEO following Lew Platt.

Next: HP History: 1999-2005 - The Carly Years