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Running Out of Indians to Fire

Anyone that has lived the corporate life knows management can play games for a very long time. And despite being utterly incompetent when it comes to knowing how to manage a company, Carly Fiorina is a master at corporate game playing. That includes the smoke-screen acquisition of Compaq Computer.

That maneuver bought the prissy princess of printers a couple of more years on the job. But the clock is ticking. I'll put a stake in the ground and predict she'll not last another 24 months.

Last week HP announced its third quarter results. Overall the company's revenues increased by 9% versus the same quarter last year. Not bad. Unfortunately, that news was overshadowed by a 5% drop in sales in the Customer Solutions Group. This group markets servers and storage products and was a key reason supporting the merger of Compaq Computer and HP.

The news was unexpected, even to Carly. However, being the trooper that she is, she didn't miss a beat. Having run out of Indians to axe, she immediately fired three vice presidents.

What a joke.

First, Carly acted as if the announcement was a total shock to her. There are only two possible explanations for being blindsided. Either you are totally inept and failed to monitor the financial progress of the company during the quarter. Or you are a liar. In Carly's case it's both.

Add to that the complete lack of responsibility she has taken in the matter. Oh no, it was three empty suit VPs that were the problem, not "Ms. Fire-ina." Would it be over the top if I said she makes me sick! It would? OK I won't say it.

Fiorina went on to blame the problems on one of the company's vendors and on a slowdown in the market. OK. Maybe a vendor did screw up, but isn't it the company's responsibility to manage its vendors and not put an outsider on the critical path of making the quarterly numbers? Yes, that is one of those rhetorical questions.

As far as a market slowdown is concerned, well, that is, how should I say it, BULL! Why do I say that? Because right after HP announced Dell Computer announced its numbers. Funny, Dell saw a 26% increase in revenues for server and storage products. And Dell expects an 21% overall increase this quarter.

What about HP's other major competitor IBM? No market slowdown there either. IBM announced it plans to increase hiring for the year from 15,000 to 18,000. Good thing there are plenty of ex-HP employees on the market.

The merger has really paid off, for Carly that is. The day the merger closed the stock traded at $18.22. It's trading at $17.08 as I write. That's a 6% drop at the same time the S&P Information Technology index is up 5.2%.

In November of 2002, Ms. Fiorina said in an interview, "The wisdom of this decision [the Compaq merger] will become more and more evident over time." Hey, she was right for once.
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