Mad Dog 21/21: Jimmy Choo Hill
June 27, 2016 Hesh Wiener
In the American West during the last quarter of the 19th century, quite a few people died with their boots on, thereby ending up in Boot Hill. These days, few people die in a saddle. Some die in gunfights. Plenty die at their desks, the way Bat Masterson did in 1921. A boneyard whose occupants expired at work wouldn’t be called Boot Hill anyway. Instead, particularly if it catered to the computer business with its many women executives, it would be named Jimmy Choo Hill.
There wasn’t just one Boot Hill. There were plenty across the Great Plains and into the West. One of them, however, is by far the most famous. That is the one in Tombstone Arizona, a town known for the 1881 Gunfight at the OK Corral. That ruckus added a few occupants to the local graveyard, including at least three gun-slinging cowboys. Boot Hill also is the final resting place of a Well Fargo station agent named Lester Moore who was shot during a dispute with a customer. Moore’s marker says, “Here lies Lester Moore, four slugs from a .44, no Les, no more.”
The survivors of the OK Corral shootout included three Earp brothers, the most famous of which was Wyatt, and Doc Holliday. Bat Masterson was one of their buddies. He missed the fight because he had to go to Dodge City, Kansas, to help one of his brothers who had problems in the saloon business. Masterson survived numerous adventures in the West but ended up in New York City, where, for 18 years, he wrote a newspaper column on sports, mainly boxing. In 1921, at the age of 67, he suffered a heart attack while at the New York Morning Telegraph. He was buried at Woodlawn Cemetery in the Bronx; Damon Runyon was one of his pallbearers. Wyatt Earp outlasted him, dying at the age of 80 in 1929. Earp is buried in Hills of Eternity, a Jewish cemetery in Colma, California, south of San Francisco, at a gravesite where he was eventually joined by his third or fourth wife, Josephine Sara (Sadie) Marcus.
The information technology industry is just as colorful as the old West, but not quite as violent, if you don’t count lawsuits as violence. Among its prominent bigshots are three women who frequently figure in news headlines. One is Carly Fiorina, who served as CEO of Hewlett-Packard from 1999 to 2005. These days she is most famous for her political ambitious, which have largely been frustrated. Fiorina, a gifted pianist, holds a Stanford BA and two advanced degrees, one from MIT. She is famous or notorious, depending on how you want to look at it, for leading HP in its acquisition of Compaq, making the combined company a giant in personal computers and servers. Fiorina was a builder before joining HP. She previously served as a top executive at Lucent, the child of AT&T’s research and manufacturing groups, where she delivered excellent results. Did she make enough to pay for Jimmy Choos? During her brief career at HP, she reportedly collected around $100 million.
While HP may have had some regrets after acquiring Compaq, it nevertheless continued to grow by acquisition. A few years after Carly Fiorina was deposed, HP, under Mark Hurd, bought the hefty services company EDS. And, after quite a bit of turmoil in the executive suite, HP is once again headed by a woman, the redoubtable Meg Whitman.
Whitman, who graduated Princeton and went on to get a Harvard MBA, is best known in the IT world for her 10 years at the helm of eBay. According to various reports, Whitman is a billionaire, and is one of the wealthiest people in all of California. She doesn’t have to shop for shoes on eBay. At HP she is completely renovating the company, something she did brilliantly at eBay. What was once a single HPQ has been split into two companies, one selling PCs, printers, and other equipment (HP Stuff-You-Can-Lift), the other serving corporate needs with goods and services. Each half has its own management team, and each has shares that are publicly traded. The split in some ways reverses the merger with Compaq executed by Carly Fiorina, with Compaq servers being transferred to HP and HP printers being moved to Compaq’s PC business. And the pair of companies’ decision to spin off or otherwise unload its IBM-oriented services group, which began life as EDS, unwinds the biggest corporate deal consummated by Mark Hurd.
Before Whitman’s reorganization, HPQ had annual revenue of more than $110 billion, making it about 25 percent larger than IBM. With the split, revenue of the combined companies is similar, but the total will fall as the EDS spinout moves ahead. IBM, however, is also in decline, so, measured by the top line, Whitman’s corporate empire will remain considerably larger.
IBM is, of course, also run by a woman. And even though revenue is less than that at the combined HP companies, Ginni Rometty won’t have to march around Armonk in her old sneakers. She’s getting by on a bonus of about $4.5 million on top of base pay of roughly $1.6 million, shares worth more than $13 million (when fully vested), some stock options, and perks galore. IBM may be going through a tough transition, but it has held the confidence of investor Warren Buffett and its share price seems to have risen quite a bit from its low for the past year.
Any of these lavishly compensated executives could afford to buy the kind of jacket Hillary Clinton wore last April when she gave a speech about the tragedy of excessive income inequality. That Armani jacket had a list price north of $12,000, enough to buy more than a dozen pairs of Jimmy Choo shoes. Clinton–like Rometty, Whitman, and Fiorina–can afford both.
None of these women seem inclined to retire. Like the lively characters who made the Old West so exciting, these powerful, successful, and tastefully clad denizens of the power stratosphere love lives of challenge and adventure. If they happen to get knocked off their mounts they will saddle up again. That’s what they have done so far. Eventually, however, they may have to put their executive careers to rest.
As Bat Masterson matured, he took up less dangerous occupations. Wyatt Earp, as he aged, moved from law enforcement to saloon-keeping and eventually to California real estate. But the group that constitutes today’s Jimmy Choo high-achievement set might not be inclined to take it easy. They may prefer to go out wearing their power footwear, even at the risk of taking a big fall.
The one most likely to gracefully fade away is Ginny Rometty. Born in mid-1957, she will turn 60 next year. That is the age at which IBM’s chief executives bow out. Investors expect her to pull a financial rabbit out of IBM’s battered hat, which after a four-year slump would be about time even if it turns out to be a trumped-up moment. Rometty might not move on to a highly visible role in the business world, the way Lou Gerstner did when he joined Carlyle Group after retiring from IBM. She might look for a prestigious but not particularly taxing job, like the one Sam Palmisano got on a White House cybersecurity committee.
Whitman doesn’t look like she is going anywhere outside the HP empire very soon, but in the case of bigwigs at the Hewlett-Packard companies it is probably unwise for any observer to predict stability. Fiorina keeps riding the political steeplechase; she seems to thrive on the excitement.
Sadly, as it now stands, none of the computer industry’s three most powerful women are cheering up shareholders right now, not even Whitman, who performed wonders for eBay investors. And all of them have put and are still putting a lot of their employees’ careers to rest, not in Jimmy Choo Hill, not in Boot Hill, but in Potter’s Field.