HP Scandal Teaches Executives the Rules of How to Spy on Colleagues

Share Article

The recent resignation of Hewlett-Packard Chairwoman, Patricia Dunn amid the uproar over the telephone probe scandal brings to our attention the question of what constitutes ethical intelligence gathering. Intelligence expert Rodger Nevill Harding explores the implications for business executives on their own intelligence operations.

The recent resignation of Hewlett-Packard Chairwoman, Patricia Dunn amid the uproar over the telephone probe scandal brings to our attention the question of what constitutes ethical intelligence gathering. In this new case, the focus is on internal spying in safeguarding critical corporate information, raising the debate of justifiable spying versus legal spying.

Looked at in context, Dunn clearly had to take action in stemming the apparent leak of information from her boardroom. “Given her motivation, the wherewithal, and her clear delegation of the task, perhaps she can be forgiven for presuming that the ends justified the means” says Rodger Harding, a Toronto-based business intelligence consultant and the author of the new book Corporate Intelligence Awareness: Securing the Competitive Edge. He notes that “Today, many companies spy on their employees just because they can. The plethora of convenient technology makes such activity common place. There is a prevailing attitude that it is only a crime when a person is caught.” The legal contention in the HP case will turn around whether or not Dunn knew that her hired consultants obtained the information under false pretext.

In the US – and certainly in Canada with the provisions in its Personal Information Protection and Electronic Documents Act and in its Telecommunications Act – fraudulently obtained information is illegal. Full disclosure is required unless the parties involved have signed prior waivers or agreements to the contrary.

The law may be interpreted widely, however, if disclosure compromises accuracy; for example, insurance claims investigators would not be expected to announce their investigation. If one considers the rise in the use of the Anton Piller remedy that allows authorized civil search and seizure procedures, the boundaries become even more tenuous.

It is strange that this story merits news headlines. After all, breaches of personal privacy happen in our lives every day. Just read the fine print in an employment contract. Most now include provisions for employers to spy on their employees who waive their rights to privacy with their signature. Who really reads every word of the end user license agreements when installing software? Think of hardware devices (including HP products) that install monitoring systems on our computers. Think of companies like Real Networks, Adobe, Microsoft, and many others all in touch with their products on our computers because we have agreed to such action with the click of a button.

Add to the mix the Sarbanes–Oxley Act and the zero tolerance policies that appeared after the Enron and WorldCom scandals – policies that demand absolute control. It is a small wonder then that corporate executives feel obliged to batten down hatches in the workplace with whatever means are at their disposal. In a despotic environment, “Bring me proof” will send minions scurrying to do just that.

But what transpired behind the closed doors at HP? Harding says that “I’m surprised that HP shares have risen since the news broke. From my viewpoint, the scandal raises several red alerts about the Board and its operation; namely that it is not a cohesive team, there are no open and safe channels of communication, and that board members do not feel comfortable enough to deal with people problems internally. Patricia Dunn’s delegation of unmasking the culprits to an outside consultant is a major red flag that all was not well within the HP inner sanctum, itself a major security breach of intelligence security.”

Is this behaviour an indication of a toxic business environment? Harding notes that “A healthy management team would have seen and heeded the warning signs that must have abounded in the HP boardroom. A team aware of the problems would have processed the resulting clues and come up with a game plan to save the situation before it got out of hand.”    

Perhaps it was the failure to accommodate the longest-serving HP director, George Keyworth, that caused him allegedly to leak the information in the first place. How much better off would the organization be if it had fully utilized his talent, creating an environment that engendered his loyalty, despite whatever differences must have existed.

Confrontation is a dirty word in our society. We seldom show displeasure and much less even do we express timely concerns or dissatisfaction. We smile falsely, and resort to back door tactics to achieve our ends. The resulting betrayal of our colleagues slowly but surely erodes confidence and the very moral fabric of our organizations. This erosion is visible to partners, clients, suppliers and the industry at large who have enough corporate intelligence smarts to look for the signs, long before it registers on the internal corporate radar.

Individuals make corporations, and they also break them. The organization that ignores the importance of intelligence awareness – sensitivity to what knowledge individuals might gather or disclose – does so at its peril.


Rodger Nevill Harding, B.A., LLB is a former career diplomat for the South African government. While working there, he was awarded the Star of South Africa – the nation’s then highest honour – for his work in intelligence gathering and strategy development. He is the president of Harding International & Associates Inc. (http://www.HardingIntl.com) a Toronto-based management consulting firm teaching intelligence strategy development to corporate executives and government officials.


Founded in 1988, Multi-Media Publications Inc. is an independent publisher of business books, ebooks, and audiobooks. Its latest book, “Corporate Intelligence Awareness: Securing the Competitive Edge” (ISBN 1895186420, $43.95 hardcover) is available from most online and traditional book retailers. Please visit http://www.mmpubs.com for more information.


Share article on social media or email:

View article via:

Pdf Print

Contact Author

Kevin Aguanno
Visit website