Hewlett Packard's original business plan from 1937: erm, let's just do some stuff

Spurred on by an intriguing reference in Good to Great about the founding minutes of Hewlett Packard, I sent a request to the HP archive asking if I could get hold of a copy. Not only did Anna Mancini e-mail me a scan of the original August 23rd 1937 minutes, but she also kindly agreed to post an excerpt for everybody to see on her blog:


I find these interesting for a couple of reasons.

Firstly, it's clear that Bill Hewlett, Ed Porter and Dave Packard wanted to work together, but didn't know what they wanted to do. This is a common theme across many different companies, including Red Gate.

Secondly, although HP is now "recognized as the symbolic founder of Silicon Valley", just imagine how their spawn – today's venture capitalists and investors – would have thumbed their noses at Hewlett and Packard's lack of ambition. Think how the elevator pitch would have gone. No paradigm-shifting, market-busting billion dollar vision, just something along the lines of:

"well, erm, we just thought we'd do some stuff. Maybe amplifiers or radio transmitters. Medical equipment, welding equipment and air conditioning controllers might be interesting too. Probably not public address systems, or selling other people's radios though. Who are our customers? Good question. We'd probably sell it to manufacturers. Not sure though – we haven't thought about it much. We might sell some services too if we have to."

Yet, despite a frankly rubbish business plan, no clear idea of what they wanted to do, and appalling timing (in the tail-end of the great depression, just before the second world war), Hewlett and Packard managed to create what would turn out to be a formidable institution. It would last some 70 years and generate hundreds of billions of dollars in revenue. Until Carly Fiorina screwed it all up, at least.

Here's the link again:


What other lessons can you see in this fascinating excerpt? I'll send a copy of The HP way by Dave Packard to the best comment …

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9 responses to “Hewlett Packard's original business plan from 1937: erm, let's just do some stuff”

  1. Corey says:

    Lots of appeal here.
    I bet the resolution to stay away from any dependency on other manufacturers is a common quality in companies that are founded primarily to exist. As opposed to, say, make lots of money quickly.
    But what I take most away from this is the very neutral style of the language — this is a document in which the CONTENT is what communicates the personality, not the style. Just about anybody could have written this document, but very few people could have meant it.
    I’m fascinated in particular by the willingness to suspend certainty. I’ll bet there’s a correlation between long-term organizational success and an organization’s ability to exist in a state of uncertainty — even to embrace and seek out that uncertainty. The drive for certainty is ultimately limiting and destructive, because it eventually eliminates all sources of innovation.
    The document doesn’t make a big deal about it — I suspect the writers didn’t even think about it. For whatever reason, they were willing to write up a business plan that didn’t insist on certainty, and so while they wrote a document that isn’t exciting to read or revolutionary in presentation, it IS revolutionary in content.
    And THAT’S a real source of potent innovative strength.

  2. Jesse Smith says:

    I think any company that hopes/plans to succeed will need to be able to adapt to changing business conditions that may lead the company in directions it never envisioned. So the successful company has to be organized and planned for *as a company*, not just for any specific product or business plan.
    But beyond just enabling this flexibility, Hewlett and Packard clearly put an enormous amount of thought and effort into building a very particular sort of company, and it’s clear that the people were the most important aspect of their business, rather than any particular line of business.
    There’s a mention in Paul Hawken’s “Growing a Business” about HP’s enlightened (particularly for the times) mission. I haven’t read “The HP Way” so I don’t know if that’s where this quote comes from, but Hawken wrote: “Hewlett-Packard states that its first goal is to make money. It wants to do that because it’s second goal is to grow as a company, and it wants to grow because its third goal is to provide an environment in which more people can thrive.”
    I think all of the truly great companies have a similar ethos at their hearts. It’s hard to be exceptional when your raison d’etre is simply to maximize profits.

  3. Being a former HP/Agilent Technologies employee and a real admirer of Bill & Dave’s work, I’d like to highlight a couple of points :
    a) the roots of HP – the original one, means Agilent Technologies today – are in this document. From Day One, HP was set to be an equipment maker selling to R&D and Manufacturing customers.
    b) Dave and Bill have not only started the whole Silicon Valley stuff, they’ve also invented the Web 2.0 business plan: create something, show it, and make some money out of it eventually.
    c) Guy Kawasaki is the son of Dave and Bill.

  4. Alex says:

    It’s also somewhat interesting that, at the time, Dave and Bill were 24 & 25 years old, respectively. They both went on to get more degrees after this meeting (Both in EE from Stanford.) In addition, HP didn’t have any money until ’39 and didn’t actually incorporate until ’47.

  5. Harshad N says:

    The lesson here is, when you have a desire for working with people you like and doing something great, just do it.

  6. RM says:

    Wonder if currently HP’s business plan are as simple:-)

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