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Packard, David

David Packard

Born: September 7, 1912
Pueblo, Colorado
Died: March 26, 1996
Palo Alto, California
Cofounder, Hewlett-Packard Company

When he formed Hewlett-Packard (HP) with his partner William "Bill" Hewlett (1913-2001), David Packard honored his personal pledge to advance science and technology. HP introduced several innovative products, including the handheld calculator and the ink-jet printer. It also influenced other businesses with its management style. Packard insisted that managers stay in contact with employees, and he practiced what he called "management by walking around." HP workers called him Dave, and they recounted stories that showed he was just one of the gang, not the wealthy owner of a leading technology company.

"We wanted to direct our efforts toward making important technical contributions to the advancement of science, industry, and human welfare. Right from the beginning, Bill and I knew we didn't want to be a 'me too' company merely copying products already on the market."

Friends in Science

Pueblo, Colorado, still had the feel of the old Wild West when David Packard was born there on September 7, 1912. His father was a lawyer and his mother was a high school teacher. The family lived on a prairie not far from the Rocky Mountains, and Packard had a lifelong love of the outdoors. (After his success at HP, Packard bought ranches in California and Idaho.)

Packard was fascinated by electronics at an early age. He built his first radio in elementary school and joined the radio club at Centennial High School. He also excelled in sports, playing football, basketball and track. In 1930, Packard enrolled at Stanford University to study electrical engineering. During his first semester, he met William Hewlett, another freshman at the school. They often took the same classes, but their friendship didn't develop until their senior year.

The two men were different in some ways: Hewlett was short and stocky, Packard was tall and lean. Hewlett came from a wealthy family, while Packard worked in a local cafeteria to earn extra money. But they shared a love of the outdoors and electronics. In 1934, they talked about starting a business with several other classmates. That plan, however, was delayed when Packard took a job at General Electric (GE) in Schenectady, New York.

Packard spent four years at GE, learning more about electronics and picking up management skills. He and Hewlett stayed in contact, and had their first official business meeting in August 1937 with plans to start a firm called the Engineering Service Company. Packard took a leave of absence from GE the next year, shortly after marrying Lucile Salter. Returning to Palo Alto, he began his partnership with Hewlett while taking classes and working nights.

Creating the HP Way

By the end of 1938, Packard and Hewlett had their first product ready for sale. They discovered that each partner had his own talents. As Packard wrote in The HP Way, "Bill was better trained in circuit technology and I was better trained and more experienced in manufacturing processes. This combination of abilities was particularly useful in designing and manufacturing electronics products."

David Packard built his first radio using a vacuum tubea common device in early electronic equipmenttwo batteries, and a few other parts. With this simple radio, he picked up a station 600 miles away.

World War II (1939-45) fueled the company's growth. With Hewlett serving in the army, Packard ran the company. The HP plant operated all day long, and Packard often slept there on a cot. His wife also worked for the company, serving as a secretary and bookkeeper. Later, Lucile Packard bought presents for HP workers who got married or had a baby. Packard credited his wife with starting many of the traditions that helped make HP feel like a family.

Carleton Fiorina: Breaking the Glass Ceiling

For decades, female executives have struggled to reach the top spots at major U.S. corporations. Some people claimed a "glass ceiling," put in place by corporate boards, let women see the opportunities available, but kept them from reaching those positions. In July 1999, Hewlett-Packard helped crack the glass ceiling when it named Carleton "Carly" Fiorina its president and chief executive officer (CEO). She became the first female to lead a major high-tech business, and the CEO of the largest U.S. company ever run by a woman. In 2000, HP also made her chairwoman of the board.

Fiorina was born in California in 1954. Like HP founders William Hewlett and David Packard, she graduated from Stanford University, although her specialty was medieval history, not electronics. She considered a career in law (her father was a judge), then worked at a number of jobs before earning a master's of business administration (MBA) from the University of Maryland. In 1980, she began working in sales for AT&T, then moved up the corporate ladder and earned a second master's degree in 1988.

When AT&T formed Lucent Technologies (see entry) to make and sell telephone and Internet equipment, Fiorina took a top position at the new company. In 1998, she was named president of Lucent's largest group, and Fortune named her the most powerful woman in business. She won the honor a second time shortly after taking the job at HP.

Fiorina's appointment won her and HP prominent attention in the press. She, however, insisted on downplaying her historical role as the most powerful U.S. businesswoman ever. Instead she focused on the job of adding spark to an old business while continuing the HP tradition. Fiorina faced resistance from some HP employees, as she came across as flashy and tough. Slowly, however, she won support from top managers and the board of directors. By 2001, however, Fiorina was still struggling to change HP.

The battle to take control of Compaq raised questions in the media about Fiorina's commitment to the legendary HP Way. She told the San Jose Mercury News that the first objective of the HP Way was to make a profit, and that was what she was after. "If you don't make money," she said, "then all this other stuff isn't possibleyou can't preserve jobs, you can't innovate, you can't contribute to the community."

After the war, HP recruited new scientists and managers, and the business grew quickly. As the company expanded, Packard was not able to have direct contact with all the employees, as he once had. He and Hewlett decided to hold a two-day meeting with senior managers to make sure they knew how to treat customers and employees, and to let the managers help shape the company's goals.

From HP to D.C.

HP always encouraged its employees to be active in the community and give time to others. Packard's outside service included serving as chairman of the board of trustees for Stanford University during the late 1950s. In that position, he met Congressman Mel Laird. In December 1968, Laird was named U.S. secretary of defense by President-elect Richard Nixon (1913-1994). Laird then asked Packard to come to Washington to serve as his deputy secretary.

Some people outside of government questioned Packard's appointment. He had almost no political experience, and HP had contracts with the military worth $100 million, raising the possibility of a conflict of interest. Packard, however, was easily confirmed for the job. While in Washington, he used the HP Way, meeting with military leaders and getting their input on budget cuts. He also set up new methods for purchasing military equipment.

Packard served as the United States was fighting the Vietnam War (1959-75), a conflict that divided many Americans. Working for the Defense Department was difficult during those years, and Packard was often criticized by politicians and the media. He also found it hard to work with the government bureaucracythe layers of officials who decide what gets done and how. Packard wrote in The HP Way that dealing with the bureaucracy was "like pushing on one end of a forty-foot rope, and trying to get the other end to do what you want!" Packard left his position at the end of 1971, although he later served on several government commissions that addressed defense issues.

Last Days at HP

Packard returned to Hewlett-Packard in 1972 and resumed his role as chairman of the board. During the next several years, he made two trips to China. On the second, Packard began a relationship with Chinese officials that led to a joint venture in 1985. During this period, both Packard and Hewlett were not involved in HP's daily operations. Their roles changed, however, in 1990, when HP faced a slowdown. Packard especially took a more active role in the company, helping to reorganize the computer operations. He finally stepped down as chairman of the board in 1993.

Throughout his career, Packard was extremely generous, giving money to Stanford, the Monterey Bay (California) Aquarium, and the David and Lucile Packard Foundation. In 1988, he gave the foundation Hewlett-Packard shares worth $2 billion. After Packard died in 1996, the foundation received the rest of his fortune. Some of the money was used by the foundation's Children, Families, and Communities Program to help minority children. Packard used his scientific and business achievements to advance human welfare, just as he had hoped.

For More Information

Books

Packard, David. The HP Way. New York: HarperBusiness, 1995.

Periodicals

Allen, Frederick E. "Present at the Creation." American Heritage (May-June 2001): p. 21.

"Carly Fiorina: Catching the Big Mo." Business Week (February 18, 2002): p. 46.

"Compaq: Fiorina's Folly or HP's Only Way Out?" Time (September 17, 2001): p. 46.

Hardy, Quentin. "The Cult of Carly." Forbes (December 13, 1999): p. 138.

"Hewlett Explains Why He Opposes HP-Compaq Deal." San lose Mercury News (February 1, 2002).

"Hewlett-Packard Chief Executive Discusses Battle for Merger." San Jose Mercury News (February 22, 2002).

King, Peter H. "One Who Took the High Road." Los Angeles Times (March 31, 1996): p. 1.

Lohr, Steve. "It's the Scion vs. the Board in Merger Fight." New York Times (February 4, 2002): p. C4.

Nee, Eric. "Open Season on Carly." Fortune (July 23, 2001): p. 114.

Saporito, Bill. "Hewlett-Packard Discovers Marketing." Fortune (October 1, 1984): p. 50.

"$2 Billion Poorer." The Economist (May 7, 1988): p. 26.

Weigner, Kathleen K. "Back into the Race." Forbes (October 10,1983): p.30.

. "Good-bye to the HP Way?" Forbes (November 26, 1990): p. 36.

Zesiger, Sue. "Cover Girl Storms Silicon Valley." Fortune (August 16,1999): p. 29.

Web Sites

Agilent Technologies. [On-line] http://www.agilent.com.org (accessed on August 15, 2002).

Hewlett-Packard Company. [On-line] http://www.hp.com (accessed on August 15, 2002).

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David Packard

David Packard

David Packard (1912-1996) was the co-founder and a longtime executive officer of Hewlett-Packard Company, a leading manufacturer of electronic measuring devices, calculators, and computers. He also served as deputy secretary of defense under President Richard Nixon and was a major benefactor to many philanthropic organizations.

David Packard was born September 7, 1912, in Pueblo, Colorado, the son of a lawyer and a high school teacher. He avidly read library books on science and electricity, and built his first radio while still in elementary school. After graduating from his local public high school, Packard enrolled as an electrical engineering student at Stanford University in California. There he met William Hewlett, a fellow student who shared his interest in electronics and the out-of-doors. In college he was a varsity athlete and president of his fraternity. He received a B.A. with honors in 1934.

Packard went to Schenectady, New York, to work in the vacuum tube engineering department of General Electric Company. He returned to Stanford in 1938 to study the theory of the vacuum tube. That year he also married Lucile Salter of San Francisco, whom he had met at Stanford; the Packards had four children.

In 1939 Packard finished his electrical engineering degree under Stanford professor, Frederick Terman. By then he had renewed his friendship with Hewlett, who had developed considerable expertise on negative feedback circuits. Hewlett and Packard set up a laboratory in the Packard family garage and soon were taking orders for apparatus ranging from air conditioning control units to electronic harmonica tuners to exercise machines. In 1939 Hewlett-Packard turned its emphasis from custom orders to mass produced instruments. Particularly important were its audio oscillators, devices that generate a controlled signal at a predetermined frequency. These were generally used to check the performance of amplifiers and broadcast transmitters, but some provided sound effects for Walt Disney's movie Fantasia.

During World War II Hewlett-Packard expanded rapidly to meet the needs of various defense projects. Packard ran the company alone, as Hewlett was in the U.S. Army. Business declined sharply at the end of the war, and Hewlett-Packard was forced to lay off employees for the only time in Packard's career. Demand rebounded by 1950; in 1957 the company's stock began to trade on the open market. Hewlett-Packard's product line grew to include not only thousands of electronic measuring devices for a wide range of frequencies but, beginning in 1972, hand-held scientific calculators. The company had done custom work in computer manufacture as early as the 1940s, but did not begin to market its own computers until the late 1960s. Experienced in supplying engineers and scientists, Hewlett-Packard had some difficulty with wider business and consumer markets. Nonetheless, it developed a wide range of programmable calculators, minicomputers, and microcomputers.

Hewlett-Packard was one of the first and largest electronics companies in the region of California now called Silicon Valley. It gradually expanded its sales force from a handful of representatives into a national and then an international network. Manufacturing facilities also extended out of California, not only to Colorado and Oregon but to Europe, South America, and Asia. At the same time, staff trained at Hewlett-Packard came to have important posts at other electronics firms. For example, Stephen Wozniak, co-founder of Apple Computer, first worked at Hewlett-Packard.

With Packard as manager and Hewlett as technical expert, Hewlett-Packard followed conservative but unconventional business practices. Profits were reinvested in the company so that debt was low. Following General Electric's example, the company preferred to hire employees directly out of school. Staff received generous benefits, were entrusted with considerable responsibility, and rarely were fired. Hewlett and Packard set general objectives, assisted those who carried them out, and chose not to flaunt their wealth and power. Engineering, sales, and management were done by men, while women did much of the actual assembly work. Emphasis was on high quality, not low price. To retain the atmosphere of a small business when the staff came to number thousands, Hewlett and Packard divided the company according to product types, with each division having its own marketing, production, and research groups. Support functions such as sales and advertising often were handled by outside contractors.

In addition to his business activities, Packard took an active interest in civic affairs. From 1948 until 1956 he chaired the Palo Alto School Board; he also gave money to the Republican Party. In 1964 he founded the David and Lucile Packard Foundation in Los Altos, California, to support universities, national institutions, community groups, youth agencies, hospitals, and other organizations that are dependent on private funding and volunteer leadership; he also served as president and chairman of the foundation. When President Richard Nixon was elected, he sought a skilled administrator to serve as deputy secretary for defense. Packard agreed to take the position, decreasing his salary from nearly a million dollars a year to about $30,000. Congressional critics pointed out that Packard owned about one-third of the stock in Hewlett-Packard and that the company did about $100 million in defense-related business each year. To avoid conflicts of interest, Packard put his stock in a trust fund, with all dividends and capital increases going to charity.

In 1971 Packard returned to his post at Hewlett-Packard. Even after he retired from direct administration in 1977, he continued as chairman of the board. He also served on the boards of directors of corporations such as Caterpillar Tractor Co. (1972-83), Chevron Corp. (1972-85), The Boeing Co. (1978-86), Genentech Inc. (1981-92), and Beckman Laser Institute& Medical Clinic (1992-96). He was a trustee of the Herbert Hoover Foundation and of the American Enterprise Institute, conservative research groups. He was a member of The Trilateral Commission from 1973 to 1981 and chaired the U.S.-Japan Advisory Commission from 1983 to 1985. In 1985 he was appointed by President Reagan to chair the Blue Ribbon Commission on Defense Management. He also was a member of the President's Council of Advisors on Science and Technology from 1990 to 1992 and founding vice chairman of the California Roundtable.

In addition to his own foundation, Packard held top positions in many philanthropic organizations. He was chairman of the Monterey Bay Aquarium Foundation; chairman and president of the Monterey Bay Aquarium Research; vice chairman of the California Nature Conservancy in 1983; and director of the Wolf Trap Foundation in Vienna, Virginia, a society dedicated to the performing arts, from 1983 to 1989.

Packard held several patents in the area of electronics measurement and published papers in that field. He received honorary degrees from Pepperdine University, University of Notre Dame, Colorado College, the University of California, Catholic University, and elsewhere. The numerous awards he received in his lifetime for both his contributions to technology and for his philanthropic work include The Gandhi Humanitarian Award in 1988, the Presidential Medal of Freedom in 1988, and induction into the Information Industry Hall of Fame, (presented jointly to Packard and Hewlett) in 1996.

In January 1989 he created the David and Lucile Packard Center for the Future of Children as a part of his foundation. The center was established to target the health and social problems of minority children under seven years old. Packard felt the center was perhaps the most important aspect of his foundation. In September 1993, Packard retired as chairman of the board at Hewlett-Packard and was named chairman emeritus, a position he held until his death at the age of 83.

Packard died on March 26, 1996 at Stanford Medical Center, after being hospitalized for ten days with pneumonia. His entire $6.6 billion fortune was given to the David and Lucile Packard Foundation, making it one of the nation's largest philanthropic organizations.

Further Reading

There is no full-length biography of David Packard. For information about his life see magazine articles such as N.W., "The Maverick of Electronics," Dun's Review (August 1967); "Lessons of Leadership: David Packard of Hewlett-Packard," Nation's Business (January 1974); and "David Packard—1981 DPMA Distinguished Information Sciences Award Winner," Data Management (October 1981). Michael S. Malone discusses Packard, Hewlett, and the Hewlett-Packard Company at some length in his book The Big Score: The Billion Dollar Story of Silicon Valley (1985).

Additional Sources

San Jose Mercury News (March 27, 1996).

Hewlett-Packard Homepage, "David Packard 1912-1996," http://www.hp.com/abouthp/packard.htm □

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Packard, David

PACKARD, DAVID

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 oscillatora sound equipment testerthat 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 practiceswhich 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.

FURTHER READING:

Akin, David. "Hewlett Helped Define Silicon Valley Success." National Post, January 13, 2001.

Bliss, Jeff. "William Hewlett." Computer Reseller News, November 16, 1997.

Hewlett-Packard Co. "David Packard." Palo Alto, CA: Hewlett-Packard Co., 2001 Available from www.hp.com.

"Hewlett-Packard Co." In Notable Corporate Chronologies. Farmington Hills, MI: Gale Research, 1999.

O'Hanlon, Charlene. "High-Tech VisionaryDavid Packard." Computer Reseller News, November 13, 2000.

SEE ALSO: Hewlett, William R.; Hewlett-Packard Co.

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David Packard

DAVID PACKARD

A cofounder of Hewlett-Packard, David Packard (19121996) was president of HP from 1947 to 1964. Then he became chairperson of the board and chief executive officer. In 1969 he was appointed as deputy U.S. secretary of defense. In addition to establishing the David and Lucile Packard Foundation, he served on various boards devoted to environment and conservation issues.

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