In the spring of 1968, a twelve-year-old boy in Los Altos, California, wanted to build a frequency counter. He did not have the parts. He did, however, have the Yellow Pages. Steve Jobs — skinny, relentless, not yet the prophet of anything — thumbed through the residential listings until he found the home number of the co-founder of Hewlett-Packard, then the most important technology company west of the Mississippi. He dialed it. Bill Hewlett picked up.
What happened next became one of Silicon Valley's origin parables, told and retold until it calcified into scripture: the man laughed, chatted with the kid for twenty minutes, gave him the spare parts, and — because this was Hewlett, because this was the kind of thing he did without thinking twice — offered him a summer job on the assembly line, putting together the very frequency counters he'd called about. "He got me a job in the place they built them," Jobs recalled decades later, "and I was in heaven." The story is usually marshaled as evidence of Jobs's audacity, his proto-entrepreneurial nerve. But it reveals something far more interesting about the man who answered the phone. Bill Hewlett's number was in the book. He answered calls from strangers. He gave a child he'd never met both the components and the context to begin a life in technology. He did this, by all accounts, without a second thought — not as philanthropy, not as corporate strategy, but as reflex. The gesture was so thoroughly Hewlett that nobody at the company found it remarkable.
This is the paradox that defines William Redington Hewlett: the man whose name came first — decided by a coin toss in a Palo Alto garage in 1939 — spent his entire career making himself second. He was quieter than David Packard, less visible, less political, less interested in the mechanics of institutional power. Packard served as Deputy Secretary of Defense under Nixon; Hewlett raised cattle and studied botany. Packard was the organizational architect; Hewlett was the tinkerer, the man who liked to understand how things worked by taking them apart. Yet the company they built together — from $538 in working capital to $49 billion in annual revenue, from a one-car garage to 90,000 employees in 120 countries — bore his name first, a permanent reminder that creation and credit do not always track together, and that the most consequential figures in a story are sometimes the ones who refuse to stand at its center.
The Garage That Became a Landmark
Part IIThe Playbook
Bill Hewlett's operating principles were never codified in a manifesto or reduced to a slide deck. They emerged over five decades of building — accumulated through decisions, habits, and structures that revealed their logic only in retrospect. What follows is an attempt to extract and articulate those principles, grounded in the evidence of what Hewlett actually did, said, and built.
Table of Contents
1.Start with contribution, not profit.
2.Let the coin toss stand.
3.Build anything that works — then find the oscillator.
4.Design constraints from your own body.
5.Wear three hats, in sequence.
6.Trust is a system, not a sentiment.
7.Walk the floor.
Preserve the core, change everything else.
In Their Own Words
The greatest success goes to the person who is not afraid to fail in front of even the largest audience.
Set out to build a company and make a contribution, not an empire and a fortune.
The best possible company management is one that combines a sense of corporate greatness and destiny, with empathy for, and fidelity to, the average employee.
The biggest competitive advantage is to do the right thing at the worst time.
A company that focuses solely on profits ultimately betrays both itself and society.
Corporate reorganizations should be made for cultural reasons more than financial ones.
A frustrated employee is a greater threat than a merely unhappy one.
The job of a manager is to support his or her staff, not vice versa and that begins by being among them.
The best business decisions are the most humane decisions. And, all other talents being even, the greatest managers are also the most human managers.
Investing in new product development and expanding the product catalog are the most difficult things to do in hard times, and also among the most important.
The address is 367 Addison Avenue, Palo Alto. The house is a 1905 Craftsman, two stories, converted to flats in 1918. Behind it sits a small garage — roughly twelve by eighteen feet, with a workbench, a drill press, and, in 1938, the smell of solder and sawdust. In 1989, the State of California designated it Historical Landmark No. 976: "The Birthplace of the Silicon Valley." HP purchased the property for $1.7 million in 2000 and spent five years restoring the exteriors to their 1938 appearance, using historic or in-kind materials, guided by documentary, physical, and pictorial evidence. The plaque does not mention that when Hewlett and Packard started working in that garage, they had no particular product in mind. They had a friendship, a shared mentor, a vague conviction that they could build electronic instruments that didn't yet exist, and five hundred and thirty-eight dollars.
The mentor was Frederick Terman — Stanford's professor of radio engineering, later dean of the School of Engineering, later provost, later canonized alongside William Shockley as a father of Silicon Valley. Terman was a particular kind of academic: impatient with theory that couldn't be applied, evangelical about the commercial potential of his students' research, and possessed of a gift for recognizing complementary temperaments. He saw in Hewlett the inventor — restless, intuitive, prone to blowing things up in the name of understanding — and in Packard the builder, the organizer, the man who could turn an idea into a schedule and a schedule into a company. When he encouraged them to go into business together, he was not being sentimental. He was engineering a partnership.
By the Numbers
The Hewlett-Packard Empire
$538Initial capital investment, 1939
$49BAnnual revenue at time of Hewlett's death
90,000Employees in 120 countries
#13Ranking among largest U.S. corporations, 2001
$9BHewlett's estimated net worth, Forbes 2000
8Audio oscillators in first major sale (to Walt Disney)
$71.50Price per oscillator sold to Disney
Hewlett arrived at Stanford as a freshman in 1930, admitted on the strength of a recommendation from his high school principal, who had initially been unimpressed by his academic record but changed her mind upon learning he was the son of Albion Walter Hewlett, one of her finest former students. The recommendation was an act of reflected glory — the son coasting on the father's reputation — but it got him through the door. Once inside, he flourished, particularly in Terman's radio engineering classes, where his instinct for hands-on experimentation found its intellectual framework.
Packard graduated first and left California for General Electric in Schenectady, New York — the customary trajectory for a Stanford engineering graduate in the 1930s, moving east to where the serious industrial work was done. Hewlett stayed, pursuing a master's degree at MIT (awarded in 1936), then returning to Stanford for further graduate work. It was during this period that he developed the design for a resistance-capacitance audio oscillator — a device for generating audio signals of a single, precise frequency. The design was clever, using an incandescent lamp as a temperature-dependent resistor to stabilize the output, a technique that made the oscillator simpler and cheaper than anything on the market. It was also, in the understated way of truly useful inventions, a product in search of a buyer.
Bowling Lanes, Urinals, and the Art of the Nickel
In 1938, Packard took an effective 50-percent pay cut, left GE, and returned to California to work with Terman and complete a graduate degree. He and his wife Lucile rented the house at 367 Addison Avenue. Hewlett rented the cottage out back. The garage became their workshop. The partnership — formalized in 1939, its name order decided by coin toss — was founded not on a product but on a conviction: they could design and manufacture electronic instruments that were not yet available, that filled gaps no one else had noticed.
"In the beginning, we did anything to bring in a nickel," Hewlett recalled in 1987. "We had a bowling-lane foul-line indicator. We had a thing that would make a urinal flush automatically as soon as a guy came in front of it. We had a shock machine to make people lose weight." This catalog of oddments — a foul-line indicator, an automatic urinal flusher, a weight-loss shock device — is usually cited as charming evidence of scrappy origins. But it reveals something more significant: Hewlett and Packard were not precious about what they built. They were not, in the beginning, trying to change the world. They were trying to survive, and they were willing to build anything that worked, for anyone who would pay.
The oscillator changed the trajectory. Designated the "Model 200A" — a number chosen, with characteristic Hewlett mischief, to make the brand-new company look established — it caught the attention of Bud Hawkins, chief sound engineer at Walt Disney Studios. Hawkins was developing the multichannel sound system for Fantasia, Disney's ambitious animated feature, and needed precise audio equipment for testing. Disney purchased eight modified units (now designated "200B") at $71.50 each. The sale was modest in dollar terms but enormous in implication: it validated the product, established a customer relationship with a marquee name, and demonstrated that a two-man operation in a Palo Alto garage could compete with established East Coast instrument manufacturers.
Within a year, they had ten employees and roughly $30,000 in sales. They had outgrown the garage.
The Father's Shadow
William Redington Hewlett was born on May 20, 1913, in Ann Arbor, Michigan. His father, Dr. Albion Walter Hewlett, was a respected physician on the faculty of the University of Michigan's medical school — a man of considerable intellectual distinction whose career in academic medicine established the family in the upper reaches of the professional class. When Bill was three, Albion accepted a faculty position at Stanford University, and the family moved to California, settling in San Francisco. The city in the 1910s and 1920s was brash, whimsical, and culturally omnivorous — anchored on the East Bay by UC Berkeley, on the West Bay by Stanford, and centered in a metropolis that had rebuilt itself from earthquake rubble with the confidence of a civilization that believed in its own necessity.
Then, when Bill was twelve, his father died suddenly. A brain tumor. The loss reordered the family's world. Hewlett later said — half-joking, half-confessing — that if his father had lived, he would have studied medicine. Instead, he chose electronics, partly because he liked electric trains.
The joke conceals a deeper truth. Hewlett's entire career can be read as a response to that early loss — not in the obvious psychological sense, but in the way it shaped his relationship to institutions. A boy who loses his father at twelve learns, before he has the language for it, that the world's structures are more fragile than they appear. He also learns — if he is lucky, if his family rallies, as Hewlett's did — that institutions can hold you when individuals cannot. The company he built with Packard was, among other things, an answer to impermanence: a structure designed to outlast any single person, including its founders.
His high school years at San Francisco's Lowell High School were, by his own account, unremarkable. He suffered from dyslexia — then little understood and rarely accommodated — which made reading and note-taking painful. He compensated by memorizing lectures, ordering them logically in his mind, a habit that trained him in systems thinking before the term existed. His grades were middling. His intellectual curiosity was not. He conducted chemistry experiments (occasionally involving explosives), built a Tesla coil, made an electric arc from carbon rods, and assembled crystal radio sets for himself and his sister. He was, in the language of the era, a tinkerer. In the language of a later era, he was an engineer who hadn't yet found his profession.
I guess that's what I'm most proud of — the fact that we really created a way to work with employees, let them share in the profits and still keep control of it.
— Bill Hewlett, 1987
The War, and What It Revealed
When the United States entered World War II, Hewlett left the company to serve in the Army, assigned to the office of the Chief Signal Officer. He spent most of the war in military signals intelligence, and in its final phase participated in an intelligence-gathering mission to Japan, assessing the state of Japanese science and technology. Packard, meanwhile, stayed and ran the company. When Hewlett returned in 1945, he found a much larger operation than the one he'd left — 200 employees, growing at 100 percent per year, driven by wartime demand for electronic instruments.
The war years are a gap in most accounts of Hewlett's life, treated as an interlude between founding and growth. But they were formative in ways that rarely get articulated. First, the separation proved that Packard could run the company alone — an important data point for a partnership that would last five decades. Second, Hewlett's military experience gave him a visceral understanding of hierarchical command structures, and he came back determined to build something different. The military model — "the man at the top issues an order and it is passed on down the line until the man at the bottom does as he is told without question (or reason)," as Packard later described it — was precisely what they did not want. Third, and most subtly, the war demonstrated the power of technical contribution in the service of something larger than profit. The instruments HP built during the war helped win it. That experience cemented a conviction that would become the core of the HP Way: a company exists to make a contribution, and profit is the measure of how well it does so, not the purpose.
The Architecture of Trust
The HP Way. The phrase has been so thoroughly absorbed into the corporate lexicon that it has lost most of its original voltage. Management consultants cite it. Business school cases anatomize it. Jim Collins, in his foreword to the 2005 edition of The HP Way, argued that Hewlett and Packard's greatest product was not the audio oscillator, the pocket calculator, or the minicomputer — it was the Hewlett-Packard Company itself, and their greatest idea was the framework of principles that governed it.
The framework, distilled to its essentials, comprised five precepts:
HP exists to make a technical contribution, and should only pursue opportunities consistent with this purpose. HP demands of itself and its people superior performance — profitable growth is both a means and a measure of enduring success. The best results come when you get the right people, trust them, give them freedom to find the best path to achieve objectives, and let them share in the rewards their work makes possible. HP has a responsibility to contribute directly to the well-being of the communities in which it operates. Integrity, period.
The radicalism of this framework is invisible now, buried under decades of imitators. But in the 1940s and 1950s, American corporate culture was rigidly hierarchical: managers wore white collars and sat in offices; workers wore blue collars and stood on factory floors; informal discussion was discouraged; deviation from orders was punished. Hewlett and Packard were building something different — a company where engineers were trusted to manage their own time, where profit-sharing linked individual effort to corporate success, where the founders insisted on being called "Bill" and "Dave" rather than "Mr. Hewlett" and "Mr. Packard."
The operational expression of this philosophy was "Management by Objective" — a term that Packard articulated in a remarkable 1960 speech to HP managers, never intended for publication, in which he laid out his thinking with the plainspoken directness of a man talking to people he trusted:
"I think many people assume, wrongly, that a company exists simply to make money. While this is an important result of a company's existence, we have to go deeper and find the real reasons for our being. As we investigate this, we inevitably come to the conclusion that a group of people get together and exist as an institution that we call a company so they are able to accomplish something collectively which they could not accomplish separately."
Management by Objective meant setting clear goals and then giving people the freedom and resources to achieve them in whatever way they saw fit. Its opposite — Management by Control — meant issuing orders and monitoring compliance. The distinction sounds obvious. In practice, it required enormous discipline and even more trust. It meant tolerating ambiguity, accepting that people would make mistakes, and believing that the net output of autonomous, motivated individuals would exceed the net output of supervised, constrained ones.
Hewlett's specific contribution to this culture was what one colleague called the "hat-wearing process" — a method for evaluating new ideas that protected both innovation and institutional rigor. When an engineer brought Hewlett a new concept, he would first put on his "enthusiasm hat": listening, expressing excitement, asking gentle questions. A few days later, he'd switch to his "inquisition hat": probing, questioning, stress-testing the idea with pointed precision. Shortly thereafter came the "decision hat": delivering judgment with logic and sensitivity. The sequence was deliberate. By separating the phases of reception, evaluation, and decision, Hewlett ensured that inventors felt heard before they were judged — and that judgment, when it came, was grounded in genuine understanding rather than reflexive skepticism.
We feel our objectives can best be achieved by people who understand what they are trying to do and can utilize their own capabilities to do them. Supervision is not a job of giving orders; it is a job of providing the opportunity for people to use their capabilities efficiently and effectively.
— David Packard, speech to HP managers, March 8, 1960
Management by Walking Around
The phrase "Management by Walking Around" — MBWA — is now a cliché of business literature. But at HP, it was a literal practice, not a metaphor. Hewlett and Packard walked the floors. They talked to engineers at their benches. They knew what was being built, and by whom, and whether the builds were compiling.
The anecdotes about this practice have the texture of company mythology, but they are consistent enough, and told by enough independent sources, to constitute something close to documentary evidence. Michael Malone, who covered HP as a reporter and later signed a book contract to tell the story of Bill and Dave, describes being invited back to HP after years of exile during the Carly Fiorina era. At a 2005 event for company veterans — Malone and Steve Wozniak were the youngest people in the room, and both were gray-haired — the oldest HPer present was Art Fong, then in his 90s, who had been "an old-timer when I was an HP intern in 1975." The gathering had the quality of Proust's final party: a room full of people who had lived something extraordinary and were watching it recede.
What they described, consistently, was a culture in which the founders' physical presence communicated a set of values that no memo could convey. When Hewlett walked through a lab, he was not performing accessibility. He was gathering information, yes — but he was also demonstrating that the work mattered enough for the co-founder to want to understand it, and that the person doing the work mattered enough to be spoken to directly.
One Hacker News commenter, recalling HP in the late 1990s, described a UK general manager who insisted on "walkabouts" alone, separate from his entourage. The manager stopped to speak to a recent graduate, who — not recognizing him — politely asked him to come back in ten minutes, as he was waiting for a build to finish. The manager smiled, said "of course, hope it compiles OK," and returned later. The anecdote is small. It is also, in microcosm, the entire HP Way: respect for the individual's work, tolerance for not being recognized, the understanding that the build matters more than the hierarchy.
The Genius of the And
Jim Collins, the management theorist who spent years studying HP as part of his research for Built to Last and Good to Great, identified what he called "the genius of the And" at the heart of the HP Way — the refusal to accept that seemingly contradictory objectives were actually in tension.
Make a technical contribution and meet customer needs. Take care of your people and demand results. Set unwavering standards and allow immense operating flexibility. Achieve growth and achieve profitability. Limit growth to arenas of distinctive contribution and create new arenas of growth through innovation. Never compromise integrity and always win in your chosen fields. Contribute to the community and deliver exceptional shareholder returns.
Behind these specifics, Collins argued, lay the biggest "And" of all: preserve the core and stimulate progress. Every great institution, he wrote — company, university, nation — exhibits a duality of continuity and change. On one hand, a set of values and purposes that remain constant. On the other, a relentless drive to change everything else: practices, strategies, structures, methods, cultural norms, competitive approaches.
Hewlett embodied this duality with particular grace. He was conservative about values and radical about technology. He insisted that HP exist to make a technical contribution — and then pushed the company through the earth-shaking shifts from vacuum tubes to transistors to integrated circuits, incorporating each new technology into the company's core business of designing and manufacturing highly differentiated test and measurement instruments. The test and measurement business — signal generators, frequency counters, spectrum analyzers — was unloved by everyone except the people who used them. It was also enormously profitable, and it was the foundation on which everything else was built.
The independent division model that Hewlett and Packard created was the organizational expression of this philosophy. Each division operated with significant autonomy — setting its own budgets, managing its own engineering, responsible for its own P&L. The founders drove overall strategy, but the divisions drove innovation. The structure encouraged entrepreneurial behavior within a large organization, making HP, in effect, a holding company for dozens of small, focused engineering teams.
It also created problems. By the time John Young succeeded Hewlett and Packard as CEO in 1978, three of HP's independent divisions had developed separate, incompatible 16-bit microprocessor computer systems. The very autonomy that had fueled innovation had produced fragmentation. Young's massive effort to create a unified 32-bit architecture — HP PA/RISC — required him to centralize control over budgets and discretion, violating the independent division model that many employees considered sacred. The HP Way, it turned out, was supple enough to navigate technological revolutions but brittle when it came to organizational consolidation. The principles remained. The structures had to change.
The Calculator That Fit in a Shirt Pocket
In 1968, HP introduced the 9100A, which the company — with a precision about nomenclature that bordered on philosophical — called a "desktop calculator" rather than a computer. Hewlett, interviewed in the company magazine Measure, explained its capabilities with the patient enthusiasm of a man who genuinely loved what his engineers had built: a surveyor could enter polar coordinates, press a single key, and receive rectangular coordinates instantly. The device used no integrated circuits; instead, it relied on a read-only memory containing over 32,000 bits of information, stored in a sixteen-layer laminated circuit board — a feat of manufacturing complexity that was, in its own way, as elegant as the user interface.
But the product that best captures Hewlett's approach to innovation came four years later. The HP-35, released in 1972, was the world's first handheld scientific calculator. Its origin story is pure Hewlett: he asked his engineers to build a version of their desktop calculator that could fit in his shirt pocket. Not a briefcase. Not a desk drawer. A shirt pocket. The constraint was physical, personal, and completely arbitrary — Hewlett simply wanted to carry the thing around. The engineers delivered. The HP-35 rendered the slide rule obsolete overnight and opened a consumer market that HP had never previously addressed.
The shirt-pocket test was not a management technique. It was an instinct — the instinct of a man who had been taking things apart since childhood, who understood that the best products are the ones you actually want to use, and who believed that the gap between "technically possible" and "personally useful" was where the most interesting engineering happened.
Discovery consists of looking at the same thing as everyone else and thinking something quite different.
— Bill Hewlett, 1986 MIT Commencement Address
Creativity and the Elephant
On a sunny day in June 1986, fifty years after he'd walked across the MIT stage to receive his master's degree, Bill Hewlett returned to Cambridge to deliver the commencement address. He was seventy-three. He had been vice chairman of HP's board. He would remain director emeritus until 1987. He had, by any measure, lived one of the most consequential careers in American technology. He chose to talk about creativity.
"When I was preparing this address," he told the graduating class, "I happened to ask Chuck House, who heads our engineering productivity department, what he thought about creativity. With a twinkle in his eye, Chuck said, 'Creativity is what screws up my engineering program.'" The audience laughed. Hewlett continued: "Thomas Edison is alleged to have remarked about his laboratory, 'There ain't no rules around here, we're trying to accomplish something.' I cite these two comments, because they say a great deal about the creative process. It works best when it is not too structured, but it must, in the long run, be tamed, harnessed, and hitched to the wagon of man's needs."
He then offered a definition borrowed from Nobel laureate Albert Szent-Györgyi: "Discovery consists of looking at the same thing as everyone else and thinking something quite different." And he admitted the limits of his own attempt to describe what he'd spent a career fostering: "Trying to describe [creativity] in detail reminds me of the story of the three blind men who attempted to describe an elephant solely by their sense of feel. One explored the trunk, one discovered the tusks, the third investigated the animal's enormous feet. But none really had a good picture of what the elephant looked like."
The metaphor was perfect — and not only because it was self-deprecating. Hewlett had spent forty-seven years at HP trying to create the conditions under which creative people could do their best work. He had learned, and was honest enough to say, that the process remained partly mysterious to him. The best he could do was establish the environment and observe who flourished. He could feel the trunk, the tusks, the feet. The elephant remained whole and alive and slightly beyond his grasp.
The Division of Temperaments
Every great partnership is, at some level, a division of labor between temperaments. Hewlett and Packard's complementarity was so clean it reads like fiction. Packard was tall, physically imposing, gregarious, politically engaged — a man comfortable with power and its exercise. He served as Deputy Secretary of Defense under Richard Nixon from 1969 to 1971, a role that suited his organizational instincts and his appetite for large-scale systems management. Hewlett was quiet, self-effacing, more comfortable in a lab than a boardroom. His hobbies were botanical study, cattle ranching, and mountain climbing — solitary pursuits, or pursuits requiring a very small team and a high tolerance for being alone with the natural world.
In the company, Packard concentrated on operations, production, and the organizational architecture. Hewlett focused on technical innovation, product development, and the cultivation of the engineering culture. "Hewlett was more proficient in technical innovation," notes the IEEE's biographical sketch, "starting with the company's first product, an audio oscillator." Packard built the machine. Hewlett built what the machine made.
The coin toss that put Hewlett's name first was, in this light, an accident that told the truth. In the hierarchy of creation, the idea precedes the institution. The oscillator precedes the company. The tinkerer precedes the manager. Hewlett's name went first not because he was more important — the question of relative importance between them was, by all accounts, one neither man entertained — but because alphabetical chance honored the sequence of creation itself.
They were also, crucially, friends. Not business partners who maintained a cordial professional relationship, but genuine friends who had met as students, camped together, shared meals, trusted each other with the kind of implicit trust that comes from decades of proximity. "I think it is obvious that we started this company because Bill and I, and some of those working with us in the early days, felt that we were able to design and make instruments which were not as yet available," Packard wrote. The sentence is simple. The pronoun structure — "Bill and I" — is revealing. Hewlett came first even in Packard's own syntax.
What Happened After
Hewlett retired as vice chairman of HP's board in 1987, the same year he received Stanford's "Degree of Uncommon Man" — an honor whose very name captures something essential about how his peers understood him. Uncommon, not extraordinary. The distinction matters. Extraordinary implies separation from the ordinary. Uncommon implies a different quality of engagement with it.
In retirement, he pursued the interests that had always competed for his attention with the company: botany, mountain climbing, cattle ranching. He was a part-time botanist of real seriousness, not the dilettante variety. He and his first wife, Flora Lamson — whom he married in 1939, the same year HP was founded, a coincidence of timing that suggests the year represented a comprehensive commitment to adult life — had established the William and Flora Hewlett Foundation in 1966 "to promote the well-being of mankind." By 2001, it had $2 billion in assets. In 1995, Hewlett endowed the Public Policy Institute of California with $70 million. In 1999, he donated $5 million to MIT to establish the William R. Hewlett Presidential Leadership Fund, inspired by his own commencement speech there thirteen years earlier. Flora died in 1977. Hewlett later remarried.
He suffered a stroke in 1993 and was in poor health for the last eight years of his life. He died in his sleep on January 12, 2001, at his home in Palo Alto, surrounded by his family. He was eighty-seven. Forbes had ranked him the twenty-sixth richest American, with an estimated net worth of $9 billion. Carly Fiorina — who had become HP's CEO in 1999 and would preside over the tumultuous 2001 acquisition of Compaq and, in the view of many longtime HP employees, the dismantling of the culture Hewlett had spent his life building — described him as "great and gentle."
The gentleness was real. So was the greatness. But neither word captures the most important thing about Hewlett, which was the relationship between the two qualities — the way his gentleness was not weakness but a form of engineering, a deliberately designed system for producing innovation, loyalty, and enduring institutional strength. He was gentle because he had calculated, correctly, that gentleness was the most efficient way to get the most out of creative people. He was great because the calculation worked.
The Garage in the Rearview
After Hewlett and Packard retired, HP was led by a succession of CEOs — John Young, Lew Platt, Carly Fiorina, Mark Hurd, Léo Apotheker, Meg Whitman — who faced the impossible task of stewarding a culture built by two specific people in a specific time. The company grew. It became the world's largest technology company by revenue under Hurd, surpassing IBM in 2008 with $118 billion in sales. It also split, in 2015, into Hewlett Packard Enterprise and HP Inc. — a bifurcation that many believed was fifteen years overdue.
The culture did not survive intact. Fiorina, who arrived from Lucent in 1999 with enormous ambition and a taste for the spotlight, pursued the Compaq acquisition over fierce opposition — including from Walter Hewlett, Bill's son, who mounted a proxy fight to stop the deal. She won the vote. She lost, in the estimation of many who had known the founders, something harder to measure. Michael Malone, who covered HP for decades, wrote that Fiorina "did a pretty good job of destroying this legendary culture at the company during her quest for personal glory … to the point that even the few survivors of the old days can barely remember what it was like to work for the company once-considered the most enlightened on the planet."
Mark Hurd — the NCR veteran who replaced Fiorina in 2005 and was, by all accounts, a brilliant operator, the kind of executive who wakes at 4:45 a.m. without an alarm because a competitor on the East Coast might already be working — restored operational discipline but never quite rekindled the HP Way. He was, as one analyst put it, "the most adept at taking costs out of the system of any executive I know." Cost-taking and culture-building are not the same skill.
Brian Armstrong, the Coinbase CEO, read Bill & Dave, the biography of the founders, as his own company grew past a thousand employees. His assessment was admiring but clear-eyed: "HP is a great case study in how to build a string of successful products and create repeatable innovation across multiple business units. … Therefore, HP is also a cautionary tale of how a company can become so dependent on a founder that it doesn't survive into the next generation."
The question Armstrong posed — whether any single company needs to last forever, or whether the principles it embodies can survive its dissolution — is the question that hovers over Hewlett's legacy. The company split. The culture fragmented. The principles endure, embedded in the DNA of every Silicon Valley startup that offers flexible hours, casual dress, employee stock options, and the assumption that engineers should be trusted to manage their own work. These are now so ubiquitous as to be invisible. They were not inevitable. Someone had to invent them.
What the Elephant Looked Like
Ted Gioia, writing in 2024, offered a comparison that would have made Hewlett uncomfortable — not because it was wrong, but because it drew attention:
"When I first came to Silicon Valley at age 17, the two leading technologists in the region were named William Hewlett and David Packard. They used their extra cash to fund schools, museums, and hospitals — both my children were born at the Lucile Packard Children's Hospital — not immortality machines, or rockets to Mars, or a dystopian Internet of brains, or worshiping at the Church of the Singularity. … Bill Hewlett had more wisdom than ego. He invested in the community where he lived — not the Red Planet. Instead of promulgating social engineering schemes, Hewlett and Packard built a new engineering school at their alma mater, and named it after their favorite teacher."
The teacher was Fred Terman. The engineering school was the Frederick Emmons Terman Engineering Center at Stanford. The act of naming it after their mentor rather than themselves was characteristic — a public declaration that the debt came first, that the chain of influence mattered more than the individual links. Hewlett's number was in the phone book. His name was on the building — but it was someone else's name he put on the school.
He did not have, as Walter Isaacson wrote of Steve Jobs, "conspicuous consumption needs" or "the competitive urge to see how high on the Forbes list he could get." What he had was a conviction — held quietly, expressed through decades of consistent action rather than through speeches or memoirs or publicity campaigns — that a company should exist to make something useful, that the people who make it should be treated as adults, and that the profits should be shared. It is, in the end, a very simple philosophy. Simple philosophies are the hardest to maintain.
On the day he died, the garage at 367 Addison Avenue was still standing. The workbench was still there. The house had been restored to look exactly as it did in 1938, when two young men with $538 and no particular product walked in and began to tinker. The California landmark plaque, bolted to the exterior, reads: "The Birthplace of the Silicon Valley." It does not mention the urinal flusher.
8.
9.Finance growth from earnings.
10.Name the building after your teacher.
11.Put your number in the book.
12.Gentle is not weak.
Principle 1
Start with contribution, not profit.
"I think many people assume, wrongly, that a company exists simply to make money," Packard said, channeling a conviction shared equally by Hewlett. The HP Way placed contribution — technical contribution, community contribution, contribution to the well-being of employees — at the center of the enterprise, with profit as the measure of how well the contribution was being made. This was not anti-capitalist idealism. It was a precise reframing: profit as feedback mechanism rather than purpose.
The distinction had operational consequences. HP would only pursue opportunities consistent with its ability to make a technical contribution. Products had to deliver something unique — "be it a technical contribution, a level of quality, a problem solved." If the answer to "does this make the world slightly better?" was no, the project was killed regardless of its revenue potential. Hewlett's test-and-measurement instruments were unglamorous. They were also uncompromisingly useful.
This principle protected the company from the most common form of strategic drift: chasing revenue into areas of mediocrity. By anchoring identity in contribution rather than in market share or financial performance, Hewlett and Packard created a filter that was self-enforcing. Engineers who joined HP because they wanted to build excellent instruments stayed. Engineers who wanted to build whatever sold fastest went elsewhere.
Tactic: Define your company's reason for existence as a specific contribution to a specific group of people, and use that definition to kill projects that generate revenue but dilute purpose.
Principle 2
Let the coin toss stand.
The coin toss that determined the order of names in "Hewlett-Packard" was not a business decision. It was a gesture of radical equality between two friends who refused to let ego determine hierarchy. Once decided, neither man revisited it. The arbitrariness of the outcome was, paradoxically, its strength — it established from the very first day that the partnership was not about individual prominence.
This principle extended throughout the company. Hewlett and Packard insisted on being called "Bill" and "Dave." They did not take reserved parking spots. They did not build corner offices. The entire cultural apparatus of the HP Way was designed to minimize the distance between the founders and the newest engineer on the bench. The message was consistent: your contribution matters more than your title.
For Hewlett specifically, this was natural rather than performed. He was genuinely self-effacing — a quiet man who preferred labs to boardrooms, who studied botany in retirement rather than writing memoirs. But the institutional expression of his temperament was deliberate. He understood that the signals leaders send about status — where they park, what they're called, whether they answer their own phone — create the cultural environment in which everyone else operates.
Tactic: Identify the status signals in your organization — titles, offices, parking, access — and eliminate the ones that create distance between decision-makers and the people doing the work.
Principle 3
Build anything that works — then find the oscillator.
HP's first products were a bowling-lane foul-line indicator, an automatic urinal flusher, and a weight-loss shock machine. None of these became the company's signature product. The audio oscillator did. But the willingness to build the first three was what created the context for the fourth.
Hewlett understood that early-stage companies cannot afford to be precious about what they make. The urinal flusher paid the rent. The oscillator built the company. The lesson is not "build urinal flushers" — it's that the revenue from unglamorous early products buys you the time and space to find the product that matters. Strategic clarity emerges from operational survival, not the other way around.
The transition from miscellany to focus — from "anything to bring in a nickel" to "electronic measuring instruments" — was not a pivot in the modern startup sense. It was a process of discovery, funded by the willingness to do undignified work. Hewlett and Packard did not know, in 1939, that they were a test-and-measurement company. They figured it out by building things and seeing what stuck.
Tactic: In the earliest stages, optimize for survival and learning over strategic purity — but watch closely for the product that generates disproportionate customer excitement, and be willing to abandon everything else when you find it.
Principle 4
Design constraints from your own body.
The HP-35 — the world's first handheld scientific calculator — was born from a single specification: it had to fit in Bill Hewlett's shirt pocket. Not a standard specification. Not a market-research finding. A shirt pocket. His shirt pocket.
This is product development as autobiography. Hewlett was his own first user, and the constraint he imposed was physical, personal, and non-negotiable. The engineering team had to miniaturize a desktop calculator's capabilities into a device small enough for a man to carry while walking through a lab. The constraint was absurd. It was also exactly right: the HP-35 sold 100,000 units in its first year and obliterated the slide rule industry.
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The Shirt-Pocket Test
How a personal constraint created a product category.
Conventional approach
Hewlett's approach
Commission market research
Ask what you personally want to carry
Define specs from competitive analysis
Define specs from physical constraints of daily use
Build for the average user
Build for the most demanding user — yourself
The deeper principle is that the best product specifications come from lived experience, not abstraction. When the founder is also the user, the feedback loop between creation and use collapses to zero. Hewlett didn't need a focus group to tell him whether the calculator was small enough. He put it in his pocket.
Tactic: Before defining product specifications, ask: "What would I want this to do in the specific physical context where I'd actually use it?" — and let that answer override market research.
Principle 5
Wear three hats, in sequence.
Hewlett's "hat-wearing process" for evaluating new ideas was a masterpiece of emotional engineering. The enthusiasm hat came first: listen, express excitement, appreciate the effort. The inquisition hat came second: probe, question, stress-test. The decision hat came third: judge with logic and sensitivity.
The sequence mattered more than any individual hat. By separating reception from evaluation from decision — and by making the separation visible and predictable — Hewlett solved one of the hardest problems in innovation management: how to maintain both the emotional safety that encourages people to propose ideas and the intellectual rigor that ensures only good ideas survive.
Most organizations collapse these phases. An engineer walks into a meeting, presents an idea, and is immediately cross-examined. The message is clear: proposing ideas is risky, because you will be judged before you are heard. Over time, fewer ideas get proposed. The organization becomes more efficient and less creative — a trade that looks rational in the short term and is catastrophic in the long term.
Hewlett's method was slow. It required three separate interactions for each idea. But it produced a culture in which engineers felt safe bringing half-formed concepts to leadership, because they knew the first response would be enthusiasm, not skepticism. The skepticism would come — but it would come after the idea had been genuinely understood.
Tactic: When someone brings you a new idea, discipline yourself to respond with curiosity and appreciation first, critical questions second, and judgment third — and make the gap between these phases visible.
Principle 6
Trust is a system, not a sentiment.
The HP Way's emphasis on trust was not an expression of optimism about human nature. It was an engineering decision. Hewlett and Packard calculated that the output of trusted, autonomous individuals would exceed the output of surveilled, controlled ones — and they designed organizational systems to test that hypothesis.
Profit-sharing linked individual effort to corporate success. Open floor plans eliminated physical barriers between managers and engineers. Flexible working hours — radical in the 1950s — communicated that the company trusted employees to manage their own time. The absence of reserved parking spaces signaled that hierarchy did not confer physical privilege.
Each of these design choices had a cost. Profit-sharing reduced short-term retained earnings. Open floors made private conversations harder. Flexible hours made scheduling complex. No reserved parking annoyed senior managers who had to walk farther. Hewlett accepted every one of these costs because the system-level benefit — a culture that attracted and retained the best engineers in the industry — was worth more than any individual efficiency loss.
The principle extends to HP's famous policy of keeping supply cabinets unlocked. Hewlett believed that if you trusted people with the company's components, they would use them responsibly — and that the occasional loss to pilferage was a trivial cost compared to the cultural message that locked cabinets sent.
Tactic: Audit your organization for "trust signals" — locked cabinets, approval workflows, surveillance systems — and calculate whether the cost of the control exceeds the cost of the trust.
Principle 7
Walk the floor.
Management by Walking Around was not a delegation technique or a listening exercise. It was an information system. Hewlett understood that the data flowing through formal channels — reports, meetings, dashboards — was filtered, abstracted, and delayed. The only way to know what was actually happening was to go where it was happening and look.
The practice had three functions. First, it gathered unfiltered intelligence: Hewlett could see which projects were stuck, which engineers were energized, where resources were misallocated. Second, it communicated values: when the co-founder walks past your bench and asks about your work, the implicit message is that your work matters. Third, it maintained calibration: Hewlett's instinct for what constituted a good product was honed not by studying market reports but by handling prototypes and talking to the people who built them.
The practice does not scale in its original form. HP in 1960, with several thousand employees, was small enough for the founders to know most of the engineering staff. HP in 1985, with 85,000 employees, was not. But the principle — that leaders must maintain direct contact with the work itself, not just with reports about the work — scales perfectly. The mechanism changes. The principle does not.
Tactic: Block time weekly to be physically present where the actual work happens — not in review meetings, but at the bench, the screen, the production line — and use what you learn to override the filtered information in your reports.
Principle 8
Preserve the core, change everything else.
HP navigated the transitions from vacuum tubes to transistors to integrated circuits without missing a beat. Each technological revolution destroyed incumbent companies. HP incorporated each new technology into its existing business because its identity was anchored in contribution (test and measurement instruments) rather than in technology (vacuum tubes, transistors, etc.).
The independent division model — each division autonomous, responsible for its own P&L, free to adopt whatever technology best served its products — was the structural mechanism that made this possible. When transistors replaced vacuum tubes, divisions adopted transistors. When ICs replaced transistors, divisions adopted ICs. No central directive was needed, because the divisions were already optimizing for product excellence rather than technology allegiance.
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Technology Transitions at HP
Core identity preserved through three technological revolutions.
1939
Audio oscillators using vacuum tube technology
1950s
Transition to transistor-based instruments
1960s
Adoption of integrated circuits across product lines
1966
Entry into computer systems business
1972
HP-35 handheld calculator — first consumer electronics product
1984
HP LaserJet printer transforms company into household name
The model broke down when the technology required coordination across divisions — as Young discovered when he tried to unify three incompatible 16-bit architectures. But for decades, the principle held: anchor identity in what you contribute, not how you make it, and you can survive any technological discontinuity.
Tactic: Define your company's core in terms of the problem you solve and the customer you serve, not the technology you use — and make it structurally easy for teams to adopt new technologies without requiring top-down approval.
Principle 9
Finance growth from earnings.
HP's first corporate objective, as published in 1957, was "to achieve sufficient profit to finance our company growth." This was not merely conservative financial management. It was a philosophical commitment to independence. A company that finances growth from earnings is beholden to no one — not to banks, not to venture capitalists, not to public markets demanding quarterly results. It grows at the rate its customers support, which is to say, at the rate its contributions are valued.
Packard articulated the corollary principle: spend between 8 and 10 percent of sales on R&D, and demand that products deliver profit at least six times the cost of developing them. The products that beat the six-to-one ratio by the widest margin, he observed, were invariably the most innovative. Innovation and profitability were not in tension. The most creative products were the most profitable because they were, by definition, the most differentiated.
This discipline imposed a natural ceiling on growth — HP could not expand faster than its earnings allowed — but it also provided a natural floor under quality. Projects that couldn't justify themselves financially were killed. Projects that could were funded generously. The result was a portfolio of products that were expensive to develop, beautifully engineered, and enormously profitable.
Tactic: Set an explicit R&D spending target as a percentage of revenue, and require every product to meet a minimum return-on-investment threshold — then kill projects that can't meet it, regardless of how technically interesting they are.
Principle 10
Name the building after your teacher.
Hewlett and Packard endowed the Frederick Emmons Terman Engineering Center at Stanford, naming it after the professor who had mentored them both, encouraged their partnership, and helped create the intellectual ecosystem from which Silicon Valley emerged. They did not name it after themselves. The decision was a public act of attribution — a declaration that the chain of influence mattered more than any individual link.
This was consistent with Hewlett's broader approach to credit and recognition. He did not write a memoir. (Packard wrote The HP Way; Hewlett contributed his support but not his byline.) He did not cultivate a public persona. He was ranked twenty-sixth on the Forbes list of richest Americans, but wealth was a byproduct of his work, not its purpose. "He had neither Ellison's conspicuous consumption needs nor Gates' philanthropic impulses nor the competitive urge to see how high on the Forbes list he could get," as Isaacson's description of Jobs's pantheon inadvertently confirmed.
The principle extends beyond philanthropy. Hewlett's approach to credit — deferring it upward to mentors and downward to employees — created an institutional culture in which recognition flowed to the work rather than to the person claiming it. Engineers at HP were famous not as individuals but as HPers. The company's reputation was their reputation, and vice versa.
Tactic: When you have the opportunity to put your name on something, consider putting someone else's name on it instead — particularly the name of the person who made your success possible.
Principle 11
Put your number in the book.
Bill Hewlett's home phone number was in the Palo Alto Yellow Pages. A twelve-year-old Steve Jobs found it and called. Hewlett answered, talked for twenty minutes, gave the kid spare parts, and offered him a summer job. The interaction is usually cited as evidence of Jobs's boldness. It is more usefully understood as evidence of Hewlett's accessibility.
The phone number in the book was a design choice. Hewlett could have unlisted it at any time. He chose not to. The choice communicated something specific: the co-founder of one of the most important technology companies in the world was available to anyone with the initiative to pick up the phone. Not through a gatekeeper. Not through a scheduling system. Directly.
This is the hardest principle to implement as an organization scales. Hewlett could answer his own phone because he was one person. A company with 90,000 employees cannot maintain the same level of founder accessibility. But the principle — that leaders should minimize the barriers between themselves and the people they serve — can be expressed in many ways: open office hours, direct email addresses, the absence of executive floors. The mechanism matters less than the message.
Tactic: Identify one channel through which anyone — employees, customers, strangers — can reach you directly, without filters, and keep it open.
Principle 12
Gentle is not weak.
Carly Fiorina called Hewlett "great and gentle." The conjunction is revealing — it implies that greatness and gentleness are separate qualities, possibly in tension, that happened to coexist in one person. Hewlett would have rejected the implication. His gentleness was not separate from his effectiveness. It was its primary instrument.
The hat-wearing process was gentle. The open floor plan was gentle. Profit-sharing was gentle. Calling everyone by their first name was gentle. These were also the mechanisms that produced one of the most innovative and profitable technology companies of the twentieth century. They worked not despite their gentleness but because of it. Creative people — the engineers and inventors whose contributions drove HP's success — are notoriously sensitive to organizational signals about whether their work is valued. Hewlett's genius was understanding that the signals had to be warm, consistent, and trustworthy, or the contributions would stop.
The opposite approach — managing through fear, urgency, and relentless pressure — can produce short-term results. It cannot produce fifty years of sustained innovation across multiple technological revolutions. That requires a culture in which people feel safe enough to take risks, stable enough to think long-term, and valued enough to give their best work to the institution rather than hoarding it for themselves. Hewlett built that culture, and he built it by being gentle.
Tactic: Audit your leadership behavior for the ratio of warmth to pressure — and recognize that in creative organizations, warmth is not a concession to weakness but the primary mechanism for producing exceptional work.
Part IIIQuotes / Maxims
In their words
In the beginning, we did anything to bring in a nickel. We had a bowling-lane foul-line indicator. We had a thing that would make a urinal flush automatically as soon as a guy came in front of it. We had a shock machine to make people lose weight.
— Bill Hewlett, 1987
Creativity works best when it is not too structured, but it must, in the long run, be tamed, harnessed, and hitched to the wagon of man's needs.
— Bill Hewlett, 1986 MIT Commencement Address
I think many people assume, wrongly, that a company exists simply to make money. While this is an important result of a company's existence, we have to go deeper and find the real reasons for our being.
— David Packard, speech to HP managers, March 8, 1960
I've never found anyone who says 'no,' or hung up the phone when I called. I just asked. Most people never pick up the phone and call, most people never ask. And that's what separates sometimes the people that do things from the people that just dream about them.
— Steve Jobs, 1994 interview, recalling his call to Bill Hewlett
We wanted to teach the calculator routines so that it would never forget.
— Bill Hewlett, 1968, on the HP 9100A desktop calculator
Maxims
Contribution first, profit as feedback. A company exists to accomplish something collectively that individuals cannot accomplish separately; money is how you measure whether the contribution is working.
Let the coin decide, then never revisit it. The best partnerships are the ones where the question of who is more important is never asked, because the answer doesn't matter.
Build the urinal flusher. In the earliest days, survival matters more than strategy; the product that pays the rent buys you time to find the product that builds the company.
The shirt-pocket test. The best product specifications come from the founder's own physical experience of using the product, not from market research or competitive analysis.
Three hats, three conversations. Separate enthusiasm from interrogation from judgment — and make the separation visible — to build a culture where people bring you their best ideas instead of their safest ones.
Unlocked cabinets. The cost of trusting people with resources is almost always less than the cost of signaling that you don't trust them.
Walk the floor, not the org chart. The only unfiltered information in any organization is what you observe directly at the point where the work is done.
Anchor identity in problems, not technologies. Companies that define themselves by the problems they solve survive technological revolutions; companies that define themselves by the technologies they use don't.
Finance growth from what you've earned. Self-funded growth is slower but freer — beholden to no one except the customers whose loyalty funds the next product.
Put someone else's name on the building. The most powerful form of recognition is attributing your success to the people who made it possible, publicly, permanently, and without qualification.
