Box 1, Folder 13 – General Speeches
January 11, 1957 – Management Conference, Sonoma, CA
1/11/57 – Four pages of notes for his remarks handwritten by Hewlett on accounting type paper.
Hewlett says 1956 has been the best year for sales, good start on oscilloscopes, good performance across the board.
Sold 2.5 million more than produced. Problem was that we prophesized a sales drop off to be filled by scopes.
Reviewing HP’s corporate objectives Hewlett says these are a sense of where we have been, and also an indication of where we are going.
- To make a profit of about 20% on sales before taxes.
- Enables us to meet other objectives
- Best measure of all as to how well we are doing
- Develop, manufacture and sell electronic measuring instruments and techniques that will contribute to the advancement of the science and practical application of electronic and electrical engineering.
- Make available to industry instruments which have inexpensive quality.
- Provide employment opportunities for HP people which includes:
- Good standard of living
- Personal satisfaction
- Meet the obligation of good citizenship to the community and to the institutions in our society which generate the environment in which we operate.
- To let our growth be determined by our performance in meeting our other objectives.
- Build sufficient strength into our organization so it is not dependent on any one or two or three people.
Relative to Sales organization Hewlett says they were neither committed, or not committed to sales reps. The objective of sales reps organization is to prove that the concept of a true partnership between a group of representatives and a strong manufacturing organization will work to the benefit of all.
Proposed objectives for reps:
- Sales to help us meet our objectives
- Service and follow-up
- Communication with development and production
- Growth – keep up with us, all the better if you can stay ahead. We are going to go through some rough times. If you are just hanging on you are sure to fall off sooner or later.
- Opportunity – to make history
Box 1, Folder 14 – General Speeches
January 28, 1957 – “Why California will Continue its Leadership in Electronics,” Electrical Club of San Francisco
1/28/57, Copy of typewritten outline of Hewlett’s speech, no transcript in folder
The following lists some of the points Hewlett lists on the outline
Why California will continue its leadership in electronics
- Leadership does not mean just greater numbers
- What standards to judge by – IRE membership?
States with largest IRE membership: NY,CA, NJ, PA
During period 1950-55 IRE membership increases:
NY – 58%
NJ – 67%
PA – 55%
National ave. – 14.7%
During 18 months from March 1950 to Sept. 1951 (Korean War) national employment in electronics rose 18%; in CA 117%
- Areas in which California leads
- Military electronics
- Specialized products
- CA lacks in consumer items – too far from center of population
Drawing on his notes from his speech “Why Electronics Grows in the West” Hewlett briefly reviews the background of electronics in California.
Bay Area is seeing expansion because
- Overflow from Los Angeles
Example – Lockheed
2. Eastern firms attracted to California because:
Example – IBM liked “livability, labor supply, excellent highways, rail and air transportation, social, cultural and educational facilities
Others – Sperry, Federal Telegraph, Philco, Sylvania
GE said Stanford was big attraction
Hewlett’s outline continues with a look at the future
Expansion of basic industry which is built on a sound fundamental basis
New products through advanced engineering
Expanding market for the types of items they produced
Outstanding scientific leadership in our universities
“Electronics is a dynamic and rapidly growing industry, but most important is that it is growing in the direction that the West Coast industries have chosen to follow. Maybe this is foresight or maybe it is luck, but it is none the less true. I am convinced that the upswing and advancement of electronics in California will continue and that California will maintain its leadership in electronics. The truth of the matter is that electronics is a natural for California, and California is a natural for electronics.”
1/28/57, Outline of speech printed by Hewlett on 3×5 inch cards
1/28/57, Two handwritten pages in Hewlett’s handwriting as a start on notes for his speech
1/28/57, Printed announcement of speech “The San Francisco Electric Club invites all members of the Electronics Industry in the Bay Area to join in celebrating Electronics Day”
1/21/57, Copy of typewritten flyer from the West Coast Electronic Manufacturers Association saying they have joined with the Electrical [?] Club of San Francisco to sponsor this event
12/5/56, Letter to Hewlett from Calvin K. Townsend WCEMA, SF Council Program Chairman, thanking him for agreeing to speak at their event
12/14/56, Copy of a letter from Hewlett to Calvin Townsend confirming his commitment and agreeing to send a title shortly
Undated, Several pages handwritten by Hewlett with notes for a speech to the Upsilon Club of the Eta Kappa Mu [spelling?] Fraternity where he spoke on the growth of electronics in the West
The folder also contains many reports, papers and miscellaneous documents with information and statistics relative to his speech subject
Box 1, Folder 15 – General Speeches
July 23, 1957 – “The Challenge of Technology in Electronics,” Stanford Business Conference, Stanford University
7/23/57, Copy of typewritten text of Hewlett’s speech
Saying that it is really the “new technology” that is the challenge, Hewlett divides this into two categories, challenges to industry and challenges to the consumer. First he defines the field of electronics as “anything that has in it a vacuum tube, or its counter-part, a solid state device such as a transistor.”
In 1956 he says the field of electronics amounted to 11 ½ billion dollars worth of business – 55% in manufacturing, 45% in non-manufacturing fields such as broadcasting and services. “…the industry is dominated,” he says, “by large companies with annual sales in excess of 100 million, twenty-two of which produce over 70% of all electronic equipment.
“One of the salient characteristics of the industry is that it is definitely research and development oriented. It is estimated that of the 500,000 engineers in this country 20% of them are engaged in the field of electronics.”
Hewlett says the most serious problem facing the electronics industry is that “fully half its manufacturing effort is supported directly by the government….Any appraisal of the future of the electronic industry must obviously start with the study of the Department of Defense uses of electronics.”
Hewlett refers to a study made by RCA on the subject of defense spending from 1956 to 1961, which forecast that “defense spending for electronics over this period would increase about 50%.” He sees spending for electronics for missiles growing much more rapidly than spending for aircraft or communications electronics.
“Non-military spending is divided rather equally between consumer and industrial applications. The consumer field is an old one and one that has somewhat leveled off. We have gone through our ‘boom and bust’ on TV and things are stable enough that the long range market can be fairly well predicted.”
“It is in the area of industrial uses of electronics that the greatest expansion, exclusive of the military, will probably be seen. A recent study estimated that industrial spending for electronics would increase 25% between 1956 and 1957,” Hewlett says.
“The real up-and-comer is the computer field which has shown an incredible rise in the past few years. From almost nothing in 1952 it has risen so that it is now estimated that in 1957 there will be about 350 million dollars spent for computers, and that this will rise to about one billion in 1960 and about two billion in 1965. It does not look as though any other field of industrial electronics has a chance to match this growth rate. The computer field, however, has many built-in problems – education of the consumer, obsolescences through rapid technological advances and high capital costs (about $1.00 of capital to $1.00 of sales).”
Automation and control is another area which Hewlett says has received “considerable attention…representing about 18% of the industrial electronics dollar [in 1956]…..Increased labor costs, shortages of adequate labor supply and requirements for increased precision all spell a long-range growth for this field – [one which] also has its own built-in problems. Two of the most serious of these are the high initial cost of the equipment and the basic difficulty of two independent industries, the machine tool and the electronic, trying to sit down and work out a joint program.
“The final area I would like to mention is that of medical electronics. This represents about 15% of the industrial electronics dollars – almost half of which is in X-Ray and radiological equipment. Again, the potential in this field is tremendous – but there is a serious problem of communications between the doctor or the medical scientist on one hand, and electronic engineer on the other. Thus, I would like to point out that of the 4 broad divisions of industrial electronics, 3 of them have a basic problem of trying to work with another discipline – this is an example of a major challenge of technology.”
Looking at the probable effects of a major reduction in government defense spending upon the electronics industry, Hewlett says, “There can be no question of the seriousness of any substantial cutback program. In all probability, however, the cutback would be somewhat gradual, not only for the sake of the electronics industry alone, but for the national economy as a whole. There are some indications that a reduction in defense spending would be accompanied by an increase in spending by some of the other governmental agencies….Obviously, however, only a fraction of the slack would be taken up in this manner. Basically, there would have to be a tremendous re-organization of the electronics industry, and in all probability this re-organization would take the form of a vigorous and concerted attack upon the problems of industry’s uses of electronics.
“This brings up the question as to why these problems are not strongly attacked now. Well, basically, it is because it is not economically profitable for the moment. When all is said and done, defense business can be profitable. The selling costs are not great, for you are dealing with relatively few customers. The problems are challenging, and up to now there has been ample money. A major move of the industry into industrial electronics would pose many problems on education, distribution and maintenance, but basically the potentialities are there. It would be the real challenge of technology.”
Hewlett returns to his statement that the challenge of electronics takes two forms – one to the manufacturer, and the other to the consumer. “To the manufacturer,” he says, “the challenge demands that he keep abreast of all major technical developments in his field, while continually monitoring related technologies, with an eye to borrowing from them when applicable. To the manufacturer this is a critical job, for as new technologies develop he must time his entry so as to be neither too early nor too late. Perhaps the effect of the introduction of the transistor is a good example. The first rather quiet announcement of the transistor was followed shortly with tremendous enthusiasm by potential users. It was the answer to all problems – it had infinite life – it was shock and vibration proof – it was infinitely stable, etc. Some manufacturers were lured into producing equipment taking advantage of these alleged assets of the transistor. But they found that many of these claims were not true, at least as of that time, and that, in addition, there were many difficulties that no one had anticipated. The result was obvious – the products failed. Yet, on the other hand, a company that is now not doing some work on the uses of transistors, where they are applicable to its field, is just asking to be scooped by its competition.”
Looking at the situation for the consumer, Hewlett says he, too, must “maintain his competitive edge in his own field, and he must continually monitor those products or techniques that will improve his production efficiency or his degree of management control. If this represents radical departures from standard practices, he must insure that he has adequate technical competence within his organization to exploit to the fullest the new equipment. The introduction of the electronic computer emphasized this point in the strongest terms. When the first Remington Rand Univac 1 was delivered to General Electric in Louisville it turned out that no one knew how to use it. It was a useless tool. The measure of success of the computer in its introduction into business has been marked by the adequacy of preparation for its intelligent use.
“The eventual introduction of automation will face the same kind of problems – and yet come it must…..Members of the manufacturing industry must follow closely activities in this field so as to time their entry for maximum effectiveness. Similarly, they must be prepared to handle the increased technical complexity of a very sophisticated system.
“The challenge of technology is to keep abreast of the products of sciences applicable to your business – to choose carefully the time of entry – and to be internally qualified to fully exploit the equipment or technique so as to insure maximum return of the investment.”
7/26/57, Telegram to Hewlett from Herbert Seibert, Editor of “The Commercial and Financial Chronicle” asking for a copy of his speech, along with a photo
8/14/57, Copy of a letter from Hewlett to Herbert Seibert sending a copy of his speech
8/14/57, Copy of a letter from Hewlett to Russell Robins, Vice President L. A. Young Spring & Wire Corporation, sending a copy of his speech in response to his request
8/30/57, Letter to Hewlett from R. Robins’ secretary thanking him for the copy
8/28/57, Article clipped from “The Commercial and Financial Chronicle” printing his speech and photo
Box 1, Folder 16 – General Speeches
December 4, 1957, “Growth Industries in the West – Electronics,” Stanford Business School
12/4/57, Copy of a two page typewritten outline of Hewlett’s speech
From this outline we see that he discussed “pre-war” electronics, particularly in the Bay Area, mentioning such companies as H & K, Eimac, Lenkurt, Dalmo Victor, Remler, Fisher, Kaar, Litton, and, of course, HP. During the war the Bay Area produced vacuum tubes and general commercial systems; the Los Angeles area, aircraft. All this pulled people to California – who liked it.
Post War growth saw electronics established as a general purpose tool, and an increase in the technical abilities of personnel, stemming from training received during the War. California universities became strong in the field of electronics. All this providing a favorable climate for engineering firms.
Korea created a big increase in demand for electronic equipment by the military – G.E., Sylvania, IBM, aircraft.
Currently Hewlett says military spending is cutting back – this is recognized by the industry which is broadening its product lines. In the long run military spending must taper off, but not suddenly.
He says the “Long range outlook is extremely dependent on how non-military product development programs proceed. I am no prophet” he says, “but—
- There is the non-military business – untapped
- It will entail clever imaginative engineers
- W. C. [?] has what it takes
- Management young enough and energetic enough to grab their share”