Bill & Dave: How Hewlett and Packard Built The World’s Greatest Company
by Michael S. Malone
Cognizant that saying this may well sound ungracious, if not heretical, the recent well-deserved paeans to Steve Jobs tactfully omit the fact that in all he accomplished, he stood on the shoulders of giants. This is not to belittle what he accomplished. He created one industry, disrupted several others, created products that inspired the fierce loyalty of millions of consumers (myself included), and set in motion careers, companies, and trends that will define the foreseeable future. But Steve Jobs did not spontaneously self-generate. Everything he became, everything he accomplished, he was able to do because other men and women had passed that way before. The Apple II, the Macintosh, NEXT, Pixar, OS X, the iPod, the iPhone, the iPad, and iTunes were his products.
But Jobs himself was the product of Silicon Valley: the place, the ecosystem, and the attitudes that combined to give this powerful, unique, and ultimately fragile wizard the place to create electronic magic.
As supporting evidence for my heresy I offer Michael Malone’s engaging biography of the founders of Hewlett-Packard, Bill & Dave: How Hewlett and Packard Built the World’s Greatest Company. It is hard for most of us to recall the days when HP was the glowing heart of Silicon Valley, especially as the latest in a long string of outsiders attempts to save the company from the consequences of misguided leadership. But in telling the story of the two proto-geeks-cum-billionaires, Malone reminds us why Hewlett and Packard deserve to stand above the Silicon Valley milieu as both icons and role models.
To be sure, the environs south of San Francisco have been engineering hotbeds since just after Governor and Mrs. Leland Stanford turned their Palo Alto farm into a college. Stanford Professor Fred Terman and entrepreneurs like Charlie Litton and Ed Varian were the early shoots of the Valley’s transmogrification into the global capital of electronic engineering. But Malone’s narrative suggests that the Valley’s destiny was no given: the region was such a backwater when Bill and Dave graduated from Stanford in the mid ’30s that there was no company in the region capable of hiring either of the talented young engineers: Packard went to work for GE in its test lab Schenectady, New York, and Hewlett, a year behind, stayed in Stanford to work with his mentor Terman. The only way for the two men to get a job that suited them was to start a company. But when they did, right on the eve of World War II, established an enterprise that brought to the region and to the industry an ethos that mixed engineering talent, opportunistic flexibility, and Depression-tempered business sense. That ethos, suggests Malone, was the fertilizer that allowed Silicon Valley as we know it to take root.
After a time as a freelance electrical engineering firm, the two men produced their 1st unique product: an audio oscillator, a product that seems prosaic now but at the time was a revelation: the men had figured out a way to use an overlooked principle of electronics to create a device that cost a tenth of the competition’s product, and was easier to use to boot. The result, the Hewlett-Packard 200A Audio Oscillator, not only set the company on its path, it also set the mold for the way the company would do business for the next five decades: tinker, innovate, disrupt, reap, repeat. In the process, Hewlett and Packard established a legacy that the young Turks of the PC revolution could only envy.
For those younger entrepreneurs…many had already failed at least once. And all of that combined to make their respect for Hewlett and Packard ever greater. Those two guys, they realized, had not only already negotiated every step of the career path they intended to follow, often doing so first, but they had done so with breathtaking grace…Even in the virulently competitive world of high technology, even as people measured their own careers against those of Hewlett and Packard, many privately admitted that matching Bill and Dave was beyond their reach. No amount of revenue or percentage of market share would ever match a company that had invented a dozen entirely new industries; no amount of laudatory BusinessWeek cover stories would ever match a company whose employees set historic records for loyalty and commitment’ and no number of trips to Washington would ever equal having a medal for quality named after you.
What is more, Hewlett and Packard had created a series of business innovations that altered forever the world of work. Flex-time, coffee breaks, casual Fridays, beer and pizza busts, open plan offices, profit-sharing, flattened organizational charts, managing-by-walking-around, and the open-door policy are but a few of the practices that HP’s founders created, championed, or popularized. Then they crafted all of these into a form of enlightened management that reinvented work for much of the developed world, and turned conventional labor-management relations on its ear.
Malone began his career as a public relations guy for Hewlett-Packard, which is perhaps why he treads lightly on the shortcomings of HP’s founders. He skims past allegations of Packard’s marital infidelities, soft-pedals HP’s defense work, and lamely excuses HP’s failure to start the personal computer revolution by suggesting that the company was “just too busy” when Steve Wozniak presented his Apple I computer to HP management. These and other tells leave Malone open to accusations of hagiography.
One could argue in Malone’s defense that his treatment of Hewlett and Packard is far less breathless than the fawning prose that too often passes for business journalism. In an age when men of commerce with far less impressive legacies than HP’s founders are lionized and deified by the business-as-a-spectator-sport crowd, Malone’s tribute to his idols is perhaps a measured effort to restore some perspective.
Which brings us back to Mr. Jobs.
A friend and I were lunching in these willow-shaded precincts last week, shivering slightly as the Beijing fall worked its way into our bones. The topic turned to Walter Isaacson’s biography of the late Apple CEO, and my friend asked if I would be reading it. “No,” I replied, “but not because I’m not interested.”
For an aspiring historian, Isaacson’s study has come out a decade or more too soon. I was a teenager when Apple was born, and I grew up watching Steve Jobs, so I don’t need a rehash of his remarkable life or career. What I want to know is whether history will treat him like a Morgan, Edison, Westinghouse, Pullman, Ford, or Watson; or whether, perhaps, he was a transitional figure setting the stage for someone or something even greater.
As for me I believe the former. But as Bill & Dave illustrates, our importance to history, to the bigger picture, is not always what we think it is at the time.