Jump to content United States-English
HP.com Home Products and Services Support and Drivers Solutions How to Buy
» Contact HP

HP.com home
Executive team  >  Carly Fiorina speeches



Company information


Executive team

» Board of directors
» Executive Calendar
» Former CEOs

Related links

» About us
» Newsroom
» Investor relations

Content starts here

OCTOBER 12, 2003

© Copyright 2003 Hewlett-Packard Development Company, L.P
All rights reserved. Do not use without written permission from HP.

It was nearly half a century ago that two social scientists named John von Neumann and Oskar Morgenstern looked back on the history of the human race and came up with a new organizing principle that they called "game theory." And I think this game theory has a unique meaning for us here today. Central to the idea of game theory is that there are two types of games that motivate businesses, countries, and people. There are "zero-sum" games, and there are "non zero-sum" games.

Zero-sum games are contests in which one person's gain is another person's loss. Translated to economics, this is the belief that for one country to win, another must lose.

But in non-zero sum games, one person's gain is not necessarily another person's loss. Non-zero sum games are the belief that for me to win, you don't have to lose. For one country to move ahead, another does not have to fall behind. When our interests overlap, we both can win. When we work together to create new opportunity, we all can win.

What Morgenstern and von Neumann argued - and also what theorist Robert Wright has argued - is that looking back on human history, the moments when our world has made the greatest social and economic progress, are those moments when new technologies came along that permit or encourage new, richer forms of non zero-sum interaction. In other words, looking back on all the great advancements through the ages, there are moments in history - from the invention of the wheel, to the Silk Road, right up through the automobile, the airplane, and the Internet - where technology makes it possible for everybody to advance together, if everybody is willing to do their part.

I believe that we are at one of those moments in history right now. The vast potential of this industry to bring social and economic progress - which frankly has mostly been the subject of breathless hype for the last decade - now has moved beyond the hype, and is within our reach. The technical barriers and excuses are in fact melting away, and I think now the real challenge for this industry is not a question of technology - it is really a question of leadership. Is each of us willing to do our part so that everybody in this industry, and in the economy, can advance together?

I think a decade from now, we are either going to be able to tell a glorious story of empowerment and opportunity, or we are going to look back on missed opportunities and talk about what might have been. For me, the issues that will determine how that story is written really come down to two things: targeted investments by government, and focused innovation by industry. Without both parts in place, we will talk about what might have been. With both parts in place, I think we can achieve our potential.

And so let me take a moment to talk about each of these in turn.

As we all know well, for every nation that chooses to participate in the global economy, the primary question it faces is one of competitiveness. What will a nation do to compete in the global economy? In this interdependent world, competitiveness drives growth, growth drives jobs and opportunity. If a nation is not doing the things necessary to be competitive, it hurts itself and global growth at the same time.

Now notice I do not say "invest in protectionism." Protectionism is at best a finger in the dyke - a short-term strategy. It is not a long-term solution because globalization is inevitable and inexorable. And so it comes down to a question of investing in competitiveness.

For an organization like the ITU, which is dedicated to advancing opportunity and equality by helping the world communicate, our primary interest must be to see that every nation that participates in the global economy is doing those things it needs to do to be competitive.

What are those things? We all begin with the understanding that the new economy today is being powered by a revolution in technology - especially in information and telecommunications. And this revolution is enhanced by open markets and growing global trade.

What are the conditions under which this new economy thrives? In the past decade, we have seen that the economy of information and communications does best in highly entrepreneurial societies where people with new ideas have access to capital; where barriers are low to establishing a new business; where rule of law and governance and transparency are strong; and where citizens are empowered to make the most of their own lives.

And so what does that mean in terms of investments? I think we have seen that the most competitive nations in the global economy are those able to invest in three things. First, they invest in the education and training of their people - because the information economy is first and foremost a knowledge economy. Second, they invest in research and development to help drive the next generation of growth by nurturing new ideas, and in new technology to bring the fruits of those ideas to market. And third, they invest in creating an environment of the rule of law, of transparency, with a focus on diverse meritocracies where an individual is judged first by their contribution, and entrepreneurs can thrive. It is surely no accident that in using this formula of investment in education, investment in R&D and technology, investment in environments where merit counts, many countries in the developed world have enjoyed the greatest economic expansion in their histories in recent years.

To me, one of the most disturbing elements of the global slowdown is that as tax revenues diminish and budgets get tight, these three kinds of investments are among the first targeted for cuts in so many western nations. In the United States alone, 48 out of 50 states are facing budget deficits today, and every one has targeted cuts in education to balance budgets. On a national level in the U.S., federal investment in research and development has fallen by more than 75 percent, to three quarters of one percent of our GDP.

And this is true not only in the United States. In Great Britain, pressure on education budgets threatens to increase tuition at some top universities by as much as 200 percent. In Germany, we recently saw thousands of students from Berlin's top universities protesting massive budget cuts in education the next few years - including protests at one university that has decided not to admit any new students in the next academic year.

As we know, the challenge of education is different in the developing world. For too long, it was too easy to assume that just because people didn't have the access to opportunity, they didn't have the talent. And what I think technology has helped prove to us over the past decade is that these assumptions and these stigmas are wrong. Not only does every single person have potential inside them, but the right training - married to the right use of technology - can help unlock that potential and take the developing world to places it has not been before.

But as an example of the challenge of education, let us look for a moment at the Arab world, where half the population is under the age of 18. Today, more than 65 million adults are illiterate - and more than ten million Arab children between 6 and 15 years of age are currently out of school. But imagine the story that could be told by 2010 if, instead, every child in the Middle East has the ability to live up to their full potential; if primary and secondary education were the norm, not the exception; if computers and computer literacy were made a part of every life. That's the bet, for example that India has made - and it's a bet that's paying off.

Now companies also have a role in investing in education and let me start with a very simple math equation. HP today is about a $73 billion dollar company. We operate in 176 countries, but we live in a world today where less than 10% of the world's population can afford to but the products we make. And we know that we are not graduating enough math, science and engineering students today to fulfill our needs in a decade. As we look ahead - not just to the next quarter, but to the next decade - we know that many of the markets, and the consumers, and the ideas, and the partners, and the employees that we continue to need to grow will come from that other 90% of the world. And so it is in our profound best interest to make sure that we play a role to ensure that all of the world can not only afford to buy our products but know how to use them.

Now obviously, our role as a company starts at home, educating and training our own workforce around the world. And many companies are heavily involved in providing resources and technical know-how to schools around the world, but it goes beyond that. We no longer live in an era where companies can write a check and send it 10,000 miles across the world; or send a few computers, or string a few lines - and think that they are really making a difference. We're finding that the greatest contribution global companies have to make is not just financial capital, but human capital - it's experience and knowledge, and our ability to set goals and meet them that make us most relevant.

And that is why at HP, for example - and we are only one company working in this area - why at HP we are committing some of our very best talent in communities from India, to Brazil, to South Africa - putting some of our best and brightest on the ground for up to three years, putting resources behind them, and working with local governments, NGOs and other businesses to meet goals that are relevant to local community. We call it e-inclusion. In India today, just as an example, we are working not just to bring mobility solutions to villages, but to make sure that the local population has the training they need to make the best use of those solutions. We think it is not just the right thing to do - it is the smart business thing to do.

Now I talked about the investments that countries need to make in competitiveness, education, and R&D in a transparent meritocracy, characterized by the rule of law. And frankly, what is true for countries is also true for companies and industries. The competitive bar keeps going up for countries and for companies. Perhaps more than at any time in history, we are in an environment where if you wait until it's obvious to everyone that your company needs to do something different, it is usually too late.

Making the changes you need to stay competitive are hard - but not making them is even harder. Now, as we focus our investments in R&D and innovation, I think we must all realize that we are entering an era where every process will become digital…and mobile…and virtual - every process.

Let us just take the simple example of photography, having watched all these photographers for several minutes. Photography used to be a physical, chemical process. You took a picture, something happened in your camera, you took your film to a film developer, something physical, chemical happened, you picked up your film, you returned, you sorted your prints, threw most of them in your bottom desk drawer, and then you mailed those pictures somewhere or put them in an album.

Today, digital photography is a digital, mobile, virtual process. You create digital content - a digital camera is a computer with a lens - and then you take that content and you network it, you send it wirelessly, you edit it, you share it, and when you are ready, you transform it into content, when and how and where you want it. And every process will follow this same pattern; every physical, analog process will become digital, mobile, virtual. We have to think about where to focus our own investments. We spend $4 billion dollars a year on R&D; we generate five patents a day; we have accelerated our rate of innovation by 350% in the last two and a-half years. Where do we focus this innovation?

I think there are several areas where innovation is needed most if we are going to make mobility mainstream. One is simplicity - mobile devices are still way too complicated to use or understand. In America last year, half of the people surveyed said that they found digital and mobile technology too complex to use. And this is in a society that is saturated by technology. What happens when we get to the developing world where people have no less talent, and no less ability, but don't have nearly the support or the resources to read a 250 page manual? We need to focus our innovation to radically simplify the use of technology, so that real people in real places can use it, and afford it, and understand it.

And this is true across the value chain from enterprises that have built up separate IT silos, for every new service that has come along in the past four years, to service providers who are now competing to offer the best services in the shortest period of time. Simplicity.

Another area is security. Again, this is an issue that crosses the value chain from consumers concerned about sensitive information like medical records or credit card numbers being transmitted wirelessly, to corporations that are seeing sensitive corporate data leave the corporate walls for the first time, without any clear sense of how it's being used. And it's especially true for service providers who are forced to find ways to incorporate services coded by third-parties, small application developers, how do they incorporate those services onto the global network, with little or no testing, and no guarantee of security.

And then, there is the issue of rich digital content. We all know that as consumers, as enterprises, as service providers - we are all suffering in some ways from an overload of information today. But we shouldn't confuse information overload with a natural appetite for useful information that helps us communicate, and learn and grow. And this is one area - rich digital content - where we have unbounded opportunity to innovate and enhance the global community. Remember every process will become digital, mobile, and virtual, which means rich media. Up until recently the fundamental challenges had to do with technical issues like processing and bandwidth. But those issues have become less challenging, and so now we can turn our attention to simplicity and security, and how we create, access, and present and protect rich digital content.

For the developed world, digital entertainment is now part of a richer mobile experience. But we see a more profound shift requiring a broader definition of rich digital content - think analog to digital scanning, archiving, protection of medical information; think next generation visually based digital education tools and applications; think real-time scanning of character recognition with audio-based translation in multiple languages…the list goes on and it just scratches the surface of technologies that can be used in different ways to improve global competitiveness.

At HP, we are proud to be a part of this journey at every step of the value chain, from devices, to the underlying infrastructure that support the telecommunications companies, to the leading provider of SMS messaging services through our OpenCall technology. What may surprise you is that we supply communications to every single one of the Fortune 500 Telco's today. For more than 100 million subscribers who turn on their cell phones, it is HP software that identifies them and allows them to place calls. I mentioned our $4 billion dollars a year in R&D, and we are focusing that investment, focusing our innovation on mobility, security, rich digital media, and simplicity and manageability.

Of course, it is not enough to innovate in a vacuum; we also have to apply it. We have to work harder to turn innovation into the application of technology that can make a real difference in real people's lives. And so today, we are focusing our innovation to drive the next wave of growth for voice and data mobility. One area where we've already made significant contributions is in the area of public and wireless local area networks - where a million people today are using HP wireless LAN installations, including 27 percent of all of the deployments in Europe, Middle East and Africa. Through our partnership with Starbucks and T-mobile, we've also put together the world's largest W-iFi hotspot network - with more than 2,300 deployments. With Nokia, we're working to change what's possible with high quality wireless printing by loading easy-to-use imaging and printing software on Nokia's camera phones. In airports, we've deployed or are engaged in deploying several end-to-end wireless LAN infrastructures around the world. And we're also working to enable the convergence of voice and data networks through IP. And through a program called the Mobile E-services bazaar, we are working with service providers to seek out third party programmers, and we're incubating them, and supporting them, and integrating them, and then offering their products on a secure platform that can easily plug into any switching network.

And of course, this is also about driving standards. What this ultimately comes down to is about making a heterogeneous world work together and speak a common language, and it is about networking - not just devices - but businesses, companies, employees to customers, and suppliers to customers. Now there are lots of people who talk about standards as being all about cost and commoditization - and certainly, standards are a way to lower costs, and they can drive commoditization in certain aspects of the technology stack - but I think standards first and foremost are about connection and common language. Because without standards, there is no connection between stand-alone islands, and there is no common language.

I think we have entered an era of technology where how things work together is everything. Whether it is technology, or companies, or partners, or governments…how things work together is everything. In the next ten years, every physical process is going to become digital, mobile, and virtual. And fabric-level innovation like security, like mobility, like simplicity, like rich media really matter, and those innovations matter in the consumer space, in the enterprise space, in the provider space, and to a woman in the co-op in the rural corner of Senegal, who wants to bring her goods to market.

I think we have an opportunity to redefine what leading means, not just in terms of capability, but in terms of character. To make real the promise of non-zero sum cooperation, each doing our part to advance a vision that can change the world. If nations everywhere - developed and developing - make the investments they need to make, if our industry can focus our innovation to make the promise of information everywhere that is accessible to everyone and from anywhere - we really will make this moment in time a magical one.

In the end, this is not about government or industry. It is about people. It is about people like a man I met last summer in South Africa, at a community center that HP helped to build. This man was sitting at a wirelessly enabled laptop. He had been surfing the Internet for the first time in his life, and his hands were literally shaking. I asked him why he seemed so moved by the experience. I expected him to tell me something about the technology he had been using. Instead, he replied, "Looking into this screen is a window on a world that I never knew existed before."

And I realized that the trip he was taking on that computer was the first time he had traveled across continents and seen the wider world around him. If any of you have seen advertisements from HP, you know that we say, 'everything is possible.' I actually believe that. Not everything is easy. Not everything happens right away. Not everything happens as we would expect it to, but everything is possible. When people work together, focused on a worthy goal, empowered by the right tools and technology - everything is possible. Telemedicine, tele-agriculture, distance learning, e-commerce - these are the wonders of possibility. And it will take all of us doing our part, to bring these possibilities to achievement. We are privileged to be on that journey with you.

Thank you very much.

Printable version
Privacy statement Using this site means you accept its terms Feedback to webmaster
© 2012 Hewlett-Packard Development Company, L.P.