David Packard

David Packard, along with fellow Stanford University graduate William Hewlett, founded California-based Hewlett-Packard Co. (HP) in 1939. Due in large part to their revolutionary management practices, Packard's and Hewlett's brainchild grew from a small testing-device manufacturer into the world's second largest computer company, behind IBM Corp., with nearly 85,000 employees and annual revenues in excess of $48 billion.

Packard was born in Pueblo, Colorado, in 1912. He studied radio engineering at Stanford University, where he met Hewlett. General Electric Co. hired Packard as an engineer in 1936, but two years later, Packard resigned and returned to Stanford to pursue a graduate fellowship. That year, with $538 in capital, he and Hewlett started a business in Packard's one-car garage. Stanford professor Frederick Terman advised the partners to market a resistance capacity audio oscillator—a sound equipment tester—that Hewlett had created as a graduate student. Packard and Hewlett named their first major product the HP 200A. The fledgling partnership's first major order came when Walt Disney requested eight of the new oscillators for the production of Fantasia . In January of 1939, Packard and Hewlett officially named their business Hewlett-Packard Co. The order of their names had been decided by a coin toss, which Packard lost.

When HP incorporated in 1947, Packard was appointed president. It was during the late 1940s, that Packard and Hewlett, who was serving as vice president, began putting in place the management practices that would later earn them recognition as the pioneers of Silicon Valley. According to Computer Reseller News columnist Jeff Bliss, "The best talent at Eastern institutions such as the Massachusetts Institute of Technology and Bell Labs took notice, and the Western migration of the country's technological brain trust began. The environment awaiting these scientists, teachers, and engineers could not have been more conducive to encouraging technology." These practices—which eventually became known as the "HP Way"—included an Open Door Policy that was created to help facilitate frequent, comfortable, and candid communication between employees and management. Employees worked in open cubicles, while the offices inhabited by managers had no doors. Packard and Hewlett also frequently walked through their facility, making themselves as accessible as possible to employees.

Packard took HP public in November of 1957. He also created a set of written objectives for HP, believing that a tangible mission would help ensure all employees were working toward the same goals. The following year, Packard oversaw HP's first acquisition, a maker of graphics recorders. In addition, he steered the firm's initial international growth efforts, which included the establishment of a manufacturing plant in Germany and a European headquarters office in Geneva, Switzerland, in 1959. By the end of the decade, Packard and Hewlett had put in place a highly decentralized structure that would endure for the next forty years. Each of HP's autonomous divisions over-saw its own research and development, manufacturing, and advertising activities. To help the firm retain its entrepreneurial climate despite rapid growth, Packard and Hewlett also decreed that each time a division's employee count exceeded 1,500, the division would be divided into two separate entities.

Hewlett replaced Packard as president in 1964. Packard spent the next three years serving as chairman and CEO. He left HP in 1969 to serve the Nixon administration as Secretary of Defense. After returning to the firm in 1971, Packard was reappointed HP's chairman. Although he had resigned as Secretary of Defense, Packard continue his governmental work throughout his career. From 1975 to 1982, he was a member of the science and technology committee of the U.S.-U.S.S.R. Trade and Economic Council. In 1985, Ronald Reagan named him chairman of the Blue Ribbon Commission on Defense Management. He also served on the President's Council of Advisors on Science and Technology between 1990 and 1992.

One year after Packard's return to HP, the firm launched the world's first scientific pocket calculator, the HP 35. HP also began its foray into computers when it unveiled the HP 3000 minicomputer. By that time, the firm had become one of the first to eliminate time clocks, to grant employees a flexible work schedule, and to add profit sharing to compensation packages. HP created its first personal computer, the HP-85, in 1980, and its first desktop mainframe machine, the HP 9000, in 1982. Two years later, HP created its most successful product ever, the LaserJet printer. While Packard was not at the helm of operations when these blockbuster products were shipped to market, he did help to create an atmosphere that fostered the development of new technology.

In 1990, after earnings dipped nearly 11 percent, Packard decided to take a more active role in HP's daily operations. Roughly 3,000 employees were laid off. In 1991, earnings rebounded, reaching $755 million on revenues of $14.4 billion. Two years later, Packard retired as chairman. He served HP as chairman emeritus until his death in 1996.