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The HP Way summary

The HP Way

David Packard · 1995

Good value given

Hewlett and Packard started HP in a Palo Alto garage in 1939.
Their first product was an audio oscillator, and Disney was an early customer.
They practiced management by objectives and walking around.
HP shared profits with employees and avoided layoffs where it could.
Packard explains why they grew from profits over debt.

What is the HP Way?

It's the set of values Packard and Hewlett built into HP. They trusted employees, shared profits, set clear goals and let people find their own way to reach them, which Packard calls management by objectives. They also walked around the office to stay in touch, and avoided taking on long-term debt.

Worth reading?Good value given. David Packard's short memoir of building Hewlett-Packard from a garage. It's a classic on management by objectives, trust and treating people well.

ActionableLessons

Actionable

Set three clear goals for your team and let them choose how to reach them.
Walk around and talk to people doing the work this week.
Ask whether your next expansion can be paid from profits.
Find one way to share success with your team.

Lessons

Trust grows ownership.
Clear goals beat close control.
Being present keeps leaders informed.
Careful growth lasts longer.

Quick answer

Our summary of The HP Way by David Packard (1995), in our own words.

What 125x is: 125x is a web app at 125x.app. You connect your YouTube subscriptions, and it gives you a feed of the latest videos from the channels you follow, each with a summary: a verdict, the 5 key takeaways, and the spoiler, plus Actionable and Lessons tabs with more tips. You read that and decide what's actually worth opening.

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Who are Bill Hewlett and David Packard?

David Packard co-founded HP with Bill Hewlett and later served as US Deputy Secretary of Defense.

He wrote The HP Way in 1995 to record the company's values.

The story in 5 parts

Stanford and Fred Terman.
The garage and the audio oscillator.
Growth through test equipment.
Building the HP culture.
Later years and leadership changes.

A closer look

Packard credits Stanford professor Fred Terman for urging him and Hewlett to start a company near the school. That support helped shape what became Silicon Valley.

He explains how HP kept teams small as it grew, splitting divisions when they got too big. Each division had its own goals and ran almost like its own company.

During a downturn in the 1970s, HP had staff take every other Friday off unpaid, so no one had to be laid off. Packard uses this to show how shared sacrifice kept trust.

He also covers open storerooms, where engineers could take parts home to tinker. He saw it as a sign of trust that encouraged invention.

Business lessons from the book

Management by objectives: goals, then freedom.
Management by walking around.
Profit sharing: everyone gains together.
Pay as you go: fund growth from profits.

Who should read it

Founders, managers and anyone building a company culture on purpose.

About this summary

We wrote this summary in our own words from the book and its public reviews. It follows the same layout as a 125x video summary: a verdict, 5 takeaways, the answer to the big question, and Actionable and Lessons tabs. More in entrepreneur biographies.

FAQ: questions people ask

What is The HP Way about?

David Packard's memoir of founding HP and its management values.

Where did HP start?

In a garage in Palo Alto in 1939.

Is The HP Way worth reading?

Good value given. Short and still useful.