HP’s Meg Whitman at Fortune’s Most Powerful Women Summit

NINA EASTON: Well, first, I want to say congratulations.

MEG WHITMAN: Thank you.

NINA EASTON: But, second, I want to say thank you. A little piece of internal drama, you almost didn’t come, of course. It’s your seventh day on the job. But, you agreed to it, and we thank you profusely. But what tipped the balance, what was it about this conference?

MEG WHITMAN: Well, I’ve been coming to this conference for, gosh, I don’t know, nearly ten years, and I always like connecting with old friends. You know what it is, it’s people connecting over a shared area of interest. Everyone in this room has something in common. And I said that I would, and I think it’s important to honor your commitments, particularly to a group of friends. So, I’m sort of seagulling in and out. I wish I could stay, but I’m delighted to be here.

NINA EASTON: And you, of course, have this big important new job. But this comes after a pretty rough year. I like to recall that in 1996, Bob Dole, after he lost the election to Bill Clinton, someone said how are you doing? And he said, sleeping like a baby. I wake up every two hours crying. (Laughter.) Tell us about your recovery?

MEG WHITMAN: Yes. Well, I did it actually for two-and-a-half years. So, when you take on a job like running for Governor of California, particularly without political experience, at least in elected office, you know, you have to invest a lot of time up front. So, it’s hard to lose. Right? No one in this audience likes to lose. And when you lose in public office, it’s very public, and very personal. So, to be perfectly honest, it was very hard. November and December was bad, and then January I could almost hear ‑‑ my mother died about a year-and-a-half ago, and I could almost hear her say, Meg, pull up your socks and get on with it.

And so, you know, began to do interesting things like at Kleiner Perkins in January, and on the board of Teach For America, on the board of The Nature Conservancy, got our philanthropic foundation up and running. So, I have lots of fun and interesting things to do. But most people who run for office and lose, they will tell you it’s a six to eight month recovery until you really feel just about normal again.

NINA EASTON: What a career. I mean, the risk-taking, when you think about it, you went from sort of the standard corporate world of Hasbro, P&G, and so forth, to this startup, eBay. Then, you plunged into politics as a novice in running for Governor of California, and writing very big checks on your behalf. What’s the Meg gene that keeps you taking these big risks? And, of course, the HP (HPQ) job, the second largest ‑‑

MEG WHITMAN: Not risky at all.

NINA EASTON: not risky at all. The second largest company in California, and we’ll talk a little bit more about your challenges there. But what is the Meg gene?

MEG WHITMAN: I actually think I love a challenge. I absolutely love a challenge. And have like a little courage gene, I think, and have had since I was a little girl. And so, I am drawn to and quite happy to take on these big challenges. I will tell you, it’s a lot more fun to win than to lose. You know, eBay was really way more fun than running for Governor. But I think it’s a little bit of a courage gene.

NINA EASTON: Where did you get it?

MEG WHITMAN: I think probably from my mom. My mom was a very courageous woman who took on enormous challenges in her day. And whether it was being stationed in the South Pacific during World War II, and remaking herself into an airplane mechanic, and a truck mechanic in four years, or whether it was just taking off to China with Shirley MacLaine. She raised three children, empty-nester Shirley MacLaine asked her if she would go to China for that documentary movie that she made in 1973, and my mother said, sure, why not. And, so I think I probably get it from her.

All that said, there’s been a little bit of criticism coming your way about the choice of you to run HP. You haven’t been in the hardware business. You haven’t run a company that’s really the size and complexity of HP, although you did want to run California. But, you and I launched into this fascinating conversation in the green room where you are applying a lot of what you learned on that difficult campaign trail to this job. Talk about that.

MEG WHITMAN: I’m sort of a big believer that things happen for a reason in your career and in your life. And I will tell you I am far better equipped to run HP today than I would have had I not run for Governor. I must give you a couple of little examples.

So, whenever you join a company that has had the challenges that HP has had, there is always going to be criticism, criticism of the board, criticism of me. And I think before I ran for Governor, I might have been quite wounded by that criticism.

And the press hasn’t been perfect on this by any means. And it’s really very funny, I know a lot of the members of the board were feeling quite badly about it, some of the employees were feeling it. And I’m reading the press going, I don’t know, this looks pretty good to me. (Laughter.) I mean, relative to the press I got on the campaign, way to go. This is good. Let’s have more of this. So, I’m a lot tougher. I’m a lot tougher. I’ve got a skin that is 100 times thicker than when I left eBay (EBAY). So, it’s actually stood me in really good stead.

And I will tell you, because we have 320,000 employees at HP, the ability that I learned by doing town halls on the campaign trail, and speaking to large groups of people, and learning to be a very effective communicator outside just a business audience, is actually turning out to be pretty useful.

NINA EASTON: So, what was so brutal about the campaign trail, and what would you advise women who might consider running for public office?

MEG WHITMAN: Any of you that are thinking about running for office, please call me. Meg@MegWhitman.com is my personal e-mail, and I want to set up about a three-hour conversation with you.

So, it’s a blood sport. Politics is a blood sport. And I found it, you’re sort of in a constant state of siege, and it’s very challenging, and it’s very personal, and there’s nothing to anchor yourself in. So, people are maybe not having all the publicity around me joining HP has not been perfect, but in the end if I deliver the results, it will all come around. In politics, there are no results until the election. So, there’s nothing to anchor that unending sort of narrative, assault, whatever, and so I found without the moorings of results, here’s the really good news for women, minorities, and business, if we deliver the results, that’s pretty good. Otherwise, it’s very hard because there isn’t that results in politics until the end whether you win or lose.

NINA EASTON: Speaking of blood sport, you’re walking into a company that’s fired its last three CEOs.

MEG WHITMAN: I noticed that.

NINA EASTON: The first was a woman, Carly Fiorina, who is on our Fortune Most Powerful Women List at about the same time you were. You know, we have a long history with both of you. Did you speak to her before you took this job? Who did you rely on? Mitt Romney is a good friend of yours, you’re a supporter of his, did you talk to him? Who are your advisors?

MEG WHITMAN: So, I had to be very careful because this was not public. I mean, it turned out to be public before we wanted it to be public. And so you have to be very thoughtful. So, I obviously first talked to my husband and children, first and foremost. Second, I have a small number of very close friends who I brought into my confidence and said, what do you think? What are the pluses, what are the minuses? Do you think this is a good job/person fit? And then a couple of long-term mentors and advisors, and actually I did ask Mitt Romney. I was traveling with him n the campaign trail when this was sort of percolating, and I said, what do you think?

NINA EASTON: And what did he say?

MEG WHITMAN: He said, you should do it.

NINA EASTON: Why?

MEG WHITMAN: He said, you know what, you only go around once. It is an opportunity to work for an American icon. HP is the grandfather, grandmother of Silicon Valley. Silicon Valley would not be in its current form had it not been for HP. It’s one of the great companies in America. It matters to Silicon Valley. It matters to California. It matters to the country. It matters to the world. And it’s a chance to really make a difference.

NINA EASTON: You’re walking into a shell-shocked culture, frankly, in this company. And yet you have to make a lot of decisions, and as you said you’re going to have to make them fast. Describe that, and describe where you’re taking this company?

MEG WHITMAN: Yes. I think there’s a couple of things. There is something wonderful about experience, isn’t there? I actually have quite a clear vision of what needs to be done here, and it is a cumulative experience of 35 years in business. So, I’m not in search of the manual. That is a good thing. So, now the question is, what is the pacing and sequencing of what you want to get accomplished.

And this organization has been through a lot. I mean, think about it, really four CEOs in eight years, and lots of changes of strategic decisions that came with those CEOs, because they were quite different individuals. HP went through a period of time of hiring from outside the company. Just a little stat, you know, a big chunk of directors, there’s 4,000 directors at HP, more than half have come from the outside, so there’s lots of issues. So, I started right off communicating to employees, fortunately we’re a technology company. There’s obviously ways to do that.

And I think the employees, they want to believe that they are ‑‑ there is a bit of post-traumatic stress syndrome in the organization. And I thought one of the funniest comments was, we did an employee survey after the first webcast, and about half the comments were quite positive, half were sort of on the fence, but one of them just cracked me up. It said, she seems nice…

So, over time I’ve got to build trust, I’ve got to win the employee base over by saying what I mean, meaning what I say, laying out a very clear strategic direction, and making sure that we not only have a mission, but a business strategy, a business unit strategy, and a financial strategy to underpin that business strategy and inspire people to take another chance.

NINA EASTON: Talk a little more in detail about you’re going to have to make a tough decision, you said, within a month.

MEG WHITMAN: So, I have sort of the short-term list of things that I’ve got to get sorted out quite quickly and then a little bit longer-term set of issues. The first is we’ve got to make Q4. This is a company that has lowered guidance each of the last three quarters. So, it would be very helpful if we made this quarter with our head held high. I mean there’s only five weeks left in the quarter. I don’t have a lot of control over it. But, there are some things that we can do.

Second, we have to integrate Autonomy. Autonomy is the very big acquisition that we just made in the software business. And this has to work. We own it. We have to make it work. So, I’ve got to make sure that gets integrated well. And it’s a U.K. company, and according to U.K. law there’s very little communication that can take place between the acquired company and the acquirer prior to close, and we close today. That’s why I’m here, too.

And then the third thing is, we have to make the final decision on what to do about what we call the PSG division, which is the PC division, which is a 43 billion business, number one in it’s marketplace, and we announced that we were evaluating whether or not to spin off this division into its own separate company. And I want to make that decision much faster than the previous CEO had planned to, because uncertainty is not our friend here.

You know, people are wondering whether they should buy HP PCs, people are wondering are we still in the hardware business. We are absolutely ‑‑ for those of you who buy technology in the audience; we are in the hardware business. And so, that’s something ‑‑ a decision that I’d like to make in the next few ‑‑ certainly before the end of October. And then, whatever the right decision is; get on with it.

NINA EASTON: So, compare running HP to running the State of California.

MEG WHITMAN: Well, I never ran the State of California. Interestingly, they’re about the same size. HP has 129 billion of revenue. The State of California has $125 billion of revenue. HP has 320,000 employees. The State of California has 347,000. Well, I will say, I have a very clear picture of what needs to be done here, and I know the levers to pull. I had a very clear picture of what needed to be done in California, but the levers were not as familiar to me.

NINA EASTON: So, do you think, and looking at Carly’s experience, as well, do you think business people are really not cut out for the rough and tumble of the campaign trail?

MEG WHITMAN: No. I mean I think we can all be cut out for almost anything we want to do. But, it is a big job from business to politics. And as you mentioned, I actually tried to enter politics at a relatively senior level, if you will. And there’s just a lot of things that are different. There’s a language of politics. I mean, you spent time as a political reporter, there’s just a way you all think of things that is different. The way we talk about things. Half the time on the campaign trail I felt like I was speaking French Canadian, but actually the language was really French. And it was just that much off, that there was a little bit of a disconnect in the ecosystem of politics.

The other thing, when you are in politics there is a way of answering reporter’s questions that is accepted and expected. And for us in business, if we answered employee questions that way, or shareholder questions, they would have our head. I mean we would be gone.

MEG WHITMAN: Correct and yet that is actually what is anticipated and expected and if you don’t know that political spin, then actually the ecosystem thinks you’re not up to it. So, it was a fascinating journey and I think I became quite a good candidate by the end, but it was a big undertaking and it’s very tough, it’s very personal. At least when you work for a company there is an organization with you, there is a team, there are products, there are services, it’s not just you. You may be the head of that organization, but it’s not only you. In politics it is all about you, all the time. And I found that to be really ‑‑ I found that to be hard.

NINA EASTON: And you also talked about out of the box you’re expected to know everything about everything.

MEG WHITMAN: Yes. This is very hard, because when you enter politics, I mean look at the presidential race, these guys are expected to know everything about everything all the time. And I was expected to know everything about the State of California. And when I started, what do I know about water policy in California, not a lot, that really hadn’t been part of my eBay experience. What did I know about the courts in California? But, by the end I knew almost ‑‑ I knew enough to be thoughtful and deliberative about all those issues. But, it’s very hard, because you really ‑‑ there is an expectation among voters, among the press, among the sort of community that you know enough about everything. And it’s a big undertaking if you’ve not grown up in the system.

NINA EASTON: It sounds like you wouldn’t run again.

MEG WHITMAN: Well, I doubt it. It would be easier the second time. I mean, I have to say it’s been fun to watch my friend Mitt Romney run again, because he knows where the trap doors are, he knows what’s going to happen. I mean, all of you, think about it, when you have seen the movie before and you know how the movie ends, or you know what’s going to happen along the way it’s a lot easier. It is the benefit of experience. So, it would be easier the second time, but I don’t think it’s in the cards. I’m at HP for the duration, sort of a new chapter and so far it’s been great fun.

NINA EASTON: And I have to ask you, you wrote checks to the tune of $144 million for that campaign, your own campaign, how painful was that? And there’s a rumor that you kind of earned it back already.

MEG WHITMAN: Well, you know when you ‑‑ not at HP. So, part of, I think, being courageous, and having the courage to do things is to try to be prepared. It’s a little bit ‑‑ what is it, the Girl Scout motto, or the Boy Scout motto, be prepared. So, I knew that this was an undertaking that was going to take ‑‑ in order to have a chance of being success, and the odds were against it from the beginning, there was going to have to be a certain amount of my own resources that went into this.

So, yes, I mean, you never like to lose. You wish you had maybe done it differently after you’d done it, but I knew exactly what I was getting into.

MEG WHITMAN: Well, you know what, listen, we’ve been okay investors.

MEG WHITMAN: My first responsibility is obviously to HP. This is a big undertaking and so job one is HP. But, I’ve known Mitt Romney for many years. Mitt was my first boss at Bain & Company back in 1980. I worked for Mitt for 10 years and he is the real deal. I think he would make a fabulous president. So, I’m going to continue to help him in every way that I can. But, I have to be very clear about this, and I was clear to Mitt, HP has got to be my first priority. But, I will stay involved in any way that I can.

NINA EASTON: Meg, we with you the best of luck in your new leap. Congratulations.

MEG WHITMAN: Thank you. (Applause.)