It Pays to Break the Rules When You're Mark Hurd

Great writers have a knack for capturing the nuances of speech and culture. In "The Right Stuff," Tom Wolfe introduces us to (sorry if the language offends) "the unscrewable pooch," a job that's so cushy you simply can't, well, screw it up.

Which brings me to Mark Hurd, the one-time wunderkind who fell from grace for canoodling in the corner office of Hewlett-Packard. OK, he may not have actually consumated the canoodle, but he apparently covered up his dalliance with a sexy contractor by fudging his expense reports. He also paid the lady a lot of money for services that weren't necessarily crucial to HP's well-being. What's more, it appears his advances weren't altogether welcome, since Jodie Fisher did claim sexual harassment.

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For that, he was forced to resign. No matter what Larry Ellison thinks, the action by HP's board was altogether justified. We no longer put sexual miscreants in the stocks, but you'd think that someone who messed up so badly would at the very least disappear from public view for a while.

But not Mark Hurd. He walked away from HP with a $34 million exit package and was just named co-president of Oracle, a gig that pays $11 million a year plus options. That'll teach him to break the rules. (HP is suing to block the hire.)

Firing Workers Is Richly Rewarded
While it may not be fashionable to engage in what the folks at Fox News like to call class warfare, I'm going to say it: No one who works at a less exalted level would get away with that behavior -- not no one, not no how.

How many people have been fired for taking a few bucks from the register or filing a padded expense report? How many journalists have been pilloried lately for lifting a passage or two from the Web without proper attribution? Quite a few, and I make no excuses for them. Rules are rules. Break 'em and you're out of here.

But l'affaire Hurd exemplifies a culture that glorifies the richest and most powerful, and places them in a rarefied zone light-years removed from the rest of us.

Consider this: A new study shows that CEOs who fired the most workers during the economic recession have also taken home the highest pay. According to the Institute for Policy Studies, the CEOs of the 50 corporations responsible for the worst layoffs were paid an average of $12 million -- 42 percent more than the average for chief executives at Standard & Poor's 500 companies.

And yes, Mark Hurd is one of them. "I was amazed to see that these stories all ignored the fact that this is a guy who has laid off more than 30,000 workers at Hewlett-Packard over the last few years, while earning more than $20 million a year. Now, to me, that is the real scandal at Hewlett-Packard," Sarah Anderson, lead author of the study, said during an interview on Democracy Now.

But the social unfairness reflected in corporate pay, goes deeper:

After adjusting for inflation, CEO pay in 2009 more than doubled the CEO pay average for the decade of the 1990s, more than quadrupled the CEO pay average for the 1980s, and ran approximately eight times the CEO average for all the decades of the mid-20th century.

American workers, by contrast, are taking home less in real weekly wages than they took home in the 1970s. Back in those years, precious few top executives made over 30 times what their workers made. In 2009, we calculate in the 17th annual Executive Excess, CEOs of major U.S. corporations averaged 263 times the average compensation of American workers. CEOs are clearly not hurting.

The quote above is from another study on CEO pay by Anderson and a number of her colleagues.

Hurd Was Not Popular
Carly Fiorina, another HP CEO who got rich by firing thousands of people, set a really low bar for popularity at her company. But it appears that Hurd couldn't clear it.

Glassdoor -- a Sausalito company that collects and posts anonymous reviews of top executives along with volumes of useful career information -- found that Hurd had an approval rating of just 34 percent, the lowest of any technology CEO. Steve Jobs, by way of contrast, has an approval rate of 98 percent, while Intel's Paul Otellini and Cisco's John Chambers scored about 82 percent.

Here are two fairly thoughtful comments on Glassdoor that caught my eye. (Many others were screams of rage.)

  • "Out of pocket benefits costs average around $2K more than at other similar IT companies. Part of the Mark Hurd cost cutting. Didn't realize this until I was signing up for benefits!"
  • "Dear board: you did the right thing letting Mark Hurd go (even if you blew it by throwing all that money at him). His replacement needs to be someone who considers employees a valuable part of the HP Way rather than numbers to cut on a flip chart."

There you go. He fires thousands, cuts benefits, breaks the rules, and walks away with tens of millions of dollars and a terrific new job. If you're wondering why there's so much anger out there, look no further.

I welcome your comments, tips, and suggestions. Post them here so that all our readers can share them, or reach me at bill.snyder@sbcglobal.net.

This article, "Take a lesson from Hurd: It pays to break the rules when you're the boss," was originally published by InfoWorld.com. Read more of Bill Snyder's Tech's Bottom Line blog and follow the latest technology business developments at InfoWorld.com.

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