Taking Mark Hurd at his word

If a pledge by HP's boss is a real harbinger, the beleaguered company may rebound sooner rather than later.

Maybe it was the nature of the early hour on the West Coast when I tuned in to Congress' investigation into the mess at Hewlett-Packard. But as I began watching the morning's festivities, I wondered whether somebody had hacked into the server to stream a segment from the 1950 Kefauver hearings into organized crime. Everybody from HP was taking the Fifth. Starting with the (now former) top legal brain at the company to the hole-in-the-wall contractors at the bottom of the pretexting food chain, everybody cited their constitutional right not to incriminate themselves.

I can understand their vow of omerta. Who wants to end up like the crooks at Enron, supposedly the smartest guys in the room? Today we got a glimpse of the folks in the room down the hall--the one with the "remedial" sign hanging outside the door.

After listening to Dunn's testimony, I still can't make up my mind whether she's peerlessly brilliant or the village idiot incarnate.

Nobody offered an opening statement and nobody was saying nuthin'. They know what happened after former Enron CEO Jeffrey Skilling testified before Congress. That was a bad move and his words came back to haunt his subsequent trial. Who wants to chance it knowing they might face the wrong end of a prosecutor's wrath in the not-too-distant future.

Their refusal to testify came as a disappointment to surprised members of a subcommittee of the House Committee on Energy and Commerce, which was holding the hearing. They clearly were in a grandstanding frame of mind. After all, there's an election in less than six weeks and taking down a corporate fat cat or two--or at least publicly embarrassing the stuffing out of them--would look awfully good to the folks back in the district.

Then they swore in Pattie Dunn, the former "non-executive" chairwoman (a moniker she kept insisting on using throughout the Q&A) who proceeded to gift-wrap their headline.

I've been trying to find sympathy for Dunn. Here's somebody whose otherwise long and distinguished career is finishing out in miserable fashion. But each time I give her a chance to prove me wrong, Dunn reconfirms my original impression of her as an amoral corporate operator.

The first thing out of her mouth was to proclaim that corporate boards have rights and then pass the buck.

At least Dunn was consistent. In previous written statements, she expressed disappointment in underlings. Dunn explained that she is not a lawyer and so relied on the advice of legal experts who said the pretexting techniques used by HP during the investigation were "not generally unlawful." And so it continued with Dunn staying on message as she stiff-armed sundry representatives trying to pin her down.

After listening to Dunn's testimony, I still can't make up my mind whether she's peerlessly brilliant or the village idiot incarnate. At her seemingly most clueless, Dunn said she had thought phone records were publicly available. Otherwise, she was evasive and inexact in telling the committee what she knew and when.

HP's outside counsel, Larry Sonsini, also testified, giving the sort of careful command performance you would expect from one of Silicon Valley's best-connected lawyers. Sonsini got out of every tight corner with a series of legal explanations that kept his inquisitors frustrated. It was a bravura corporate rope-a-dope. But what's legal is not always ethical. Sonsini did urge legislators to provide more clarity on pretexting, but sharp lawyers doubtless know that that sort of technique is a stinker from the get-go.

Hurd steps up
At least Mark Hurd wasn't morally obtuse or didn't pretend not to understand the damage inflicted by the mushrooming scandal. When he got his chance to testify, Hurd again apologized for the mess and said that if HP's co-founders were alive today, they'd be embarrassed. So indeed they would. Reaching back into the company's history at this point aligns him--even if only metaphorically--with the storybook legend of Bill Hewlett and David Packard. And to his credit, Hurd has started to clean house. Dunn is gone. So is senior counsel Kevin Hunsaker, as well as Ann Baskins, who was Hunsaker's boss. Other shoes will likely drop in coming days and weeks.

Even more, Hurd lived up to his advance billing as a top-notch leader for the first time since the pretexting affair broke earlier this month. He wasn't hiding behind his PR team or blaming out-of-control goofballs for what's happened.

Instead of ducking hard questions, Hurd pledged his support for legislation to make pretexting illegal--a savvy move that may help get Congress off his back. I can see the wording on the handbills: "Who better than to understand this scourge than the company that's become the poster child for pretexting?"

As the hearing neared its finish, Hurd also offered a profound parting observation to the committee. Everyone makes errors. But in the end, we're ultimately defined by how we deal with those mistakes. If Hurd's pledge is a real harbinger, HP may be able to glimpse the light at the end of the tunnel sooner, rather than later.

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