TR: Can you describe the key steps to reinventing the company in more detail?
FIORINA: Reinvention to me is about four things. It’s about culture, it’s about strategy, it’s about what you measure and how you reward those measurements, and it’s about business process. All of those levers need to be pulled.

At a cultural level, we have to be explicit about the values and the behaviors that help us, and explicit about the behaviors that are getting in our way. So our emphasis on reaffirming the core values that have been with this company for 60 years-trust, integrity, teamwork, contribution-is a reaffirmation of the behavior we need to carry us forward.

Reinvention also requires some tough strategic choices about how and where we want to play. Those choices are particularly difficult for a company with the depth and breadth of capability of HP, because a company like HP honestly can do anything it wants to do. And so the hardest strategy is deciding what not to do. I’ll give you a very simple example. We had inside the company when I arrived at least five separate architectures for e-publishing-all of them good. And what we had to do was decide we’re going to have one-so that we have sufficient focus on that one platform to make sure it really is a winning play.

Metrics has a lot to do with what’s expected. So we talk around minimally acceptable performance and aspirational performance. Minimally acceptable performance is performance that meets the expectations of customers and shareowners. And aspirational performance is performance that leads the market-that sets the standard-and we pay people very differently for those two levels of performance.

Then there’s a whole very broad area around processes-whether we’re talking about a pricing process (or) the processes we use to build the relationship between our employees and the company.

TR: Going back to the point about culture, the traditional HP culture is one of excellence in engineering and conservative management. This has many positive aspects. But it has also made it extremely difficult to take risks.
FIORINA: You are right that HP had become too reluctant to take risks. We’d become too slow. Everything had to be decided by consensus. But bad habits develop in any company, any family, any individual. So I’ve asked the company’s senior leadership, management ranks-indeed all employees-to “look in the mirror.” In other words, to be explicit and open about what has to change, what should stay the same. I intend to preserve and nurture the core values that have made this company great. Respect and service to customers and to the communities in which we live and work are things I call HP’s shining soul. It’s our essence, giving us a competitive advantage.

TR: How does this relate to your $200 million brand campaign?
FIORINA: The brand is a promise to our customers and our partners about who we are, where we’ve been, and where we intend to go. It’s a reminder to the people of HP about our inventive capability, returning, in a way, to the “Rules of the Garage”-reflecting the garage in which HP was born. You’ll see it in ads, in poster form in employees’ cubicles, and it’s actually become a popular item among our customers, too. So, we are building very consciously an organization where roles and responsibilities are clear, but where there also is a requirement for interdependence and collaboration-and we’re doing that because we think the market demands it. We’re doing it because we believe when we really leverage the capabilities of this company we are, I don’t want to sound overly aggressive, but we’re almost unbeatable.

TR: Shortly before you joined, HP announced plans to split off its original instrument business-something it’s subsequently done as Agilent Technologies. Why was that move necessary? Doesn’t it take away a lot that was unique about the company and make innovation more difficult?
FIORINA: Focus is crucial for a company, especially a large one. I believe it was a wise decision to spin off Agilent-making up HP’s former test and measurement, medical products, chemical analysis and semiconductor businesses. What continues under the HP name-computers, printing and imaging products, information technology services and software-has a rich history in innovation, outstanding people and technologies, and world-class partnerships. We’re confident both companies will be able to innovate better and faster as separate entities. And there’s no reason we can’t partner on certain things.