Yale professor on Carly Fiorina's business record: She 'destroyed half the wealth of her investors yet still earned almost $100 million'

Carly Fiorina is ready to take on Donald Trump, the front runner for the Republican nomination.

"I think Mr. Trump's going to be hearing quite a lot from me," said Fiorina in an interview with CNBC ahead of the second Republican debate.

"Donald Trump and I are in totally different businesses," said Fiorina. "He's in the entertainment business. And he's also in a privately held business. In the business I was in, we had to report our results publicly, as you well know, in excruciating detail, quarter after quarter after quarter."

She added, "If you file for bankruptcy four times, I think it suggests either lack of judgment or lack of discipline."

So far, no attacks on Trump have stuck. Maybe this one will stick. Maybe people will question Trump's business credentials.

But, Fiorina better be careful, because her biggest business achievement, CEO of Hewlett-Packard, is widely regarded as a disaster.

She's been frequently called out as one of the "worst" CEOs.

In an article about worst CEOs in USA Today in 2005, Yale business Professor Jeffrey Sonnenfeld said that Fiorina was "the worst because of her ruthless attack on the essence of this great company. ... She destroyed half the wealth of her investors and yet still earned almost $100 million in total payments for this destructive reign of terror."

Trump is quick witted, and incisive. He is really good at delivering campaign ending insults. Fiorina appears ready to serve Trump a softball if she's going to run on her business record.

Stands by his 'worst CEO' comment today

We reached out to Sonnenfeld, who is still at Yale (he's a Senior Associate Dean) who told us he stands by his opinion, "Yes - I stand by what I said. The only things I would add are 1) The board's wisdom in her unanimous firing was vindicated by the fact that there has been no exoneration or contrition."

Sonnenfeld also told us, "virtually everything she bought [while at HP] ... has been shuttered or divested," and he pointed out (emphasis his), "She has NEVER been offered another CEO position in the decade since."

He also contends that she was asked to leave Taiwan Semiconductor's board in 2009 "as she only attended 17 percent of their board meetings." (Something he's noted publicly before.)

Fiorina's campaign has responded by attacking Sonnenfeld's credibility.

A rundown of her business achievements

Prior to her time at HP, she was a rising star at telecom equipment maker Lucent, where she led corporate operations when Lucent spun off from AT&T and then rose to become a top president there.

However, even her time a Lucent was controversial, Arik Hesseldahl at Re/Code points out.

As a sales leader, she was knee-deep in Lucent's aggressive lending practices, loaning money to customers to buy Lucent equipment, Hesseldahl reports. A few years after she left, Lucent crashed big time, not helped by $7 billion in loans to customers -some of which were out of business.

A Lucent employee, Joe Russo, who worked under Fiorina at Lucent, recently wrote an article in Fiorina's defense, describing her as a caring executive who was "open, honest and inspiring" and "just plain cool."

Fiorina was HP's CEO from mid 1999 to early 2005, following Lewis Platt. She was famously fired from HP. Fiorina today explains she was hired to transform a somewhat stodgy company and fired when the company resisted her ideas.

The stock plunged between the time she started and the time she left. When she began, the stock was hovering around $55. It was hovering at $19 - $20 when she was fired, after the company had missed a few earnings expectations.

To be fair, her tenure overlapped with the end of the dot-com bubble, and a lot of tech companies had similar stock price drops during that period as well. But HP's stock performance was worse than other big tech companies, such as Cisco, Intel, Microsoft, and Oracle, during her tenure.

She's famous for buying Compaq over the strong objections of some board members. Fiorina led HP into a very bitter and public board-level fight over the acquisition of Compaq. She wanted to buy the big PC rival and turn HP into the biggest PC maker.

A faction of the board, led by Walter Hewlett (son of internally revered company co-founder William Hewlett), opposed the buy and launched a proxy fight. Fiorina won the proxy fight, and HP bought Compaq for about $19 billion in 2002.

The integration of Compaq into HP was not smooth. Key Compaq executives reporting to Fiorina left or were ousted. And Fiorina angered many employees with a massive layoff right after the acquisition, cutting a reported 30,000 HP jobs.

The acquisition did turn HP into the largest PC maker, and it's been consistently in the top three (trading places with Dell and Lenovo periodically) ever since.

Her campaign points out that after the Compaq acquisition, HP's revenue was a lot bigger, as was its cash flow and it employed a lot more people.

Annual revenue growth declined. Fiorina's campaign says that HP's revenue growth rate climbed from 2% to 9% while she led the company, based on comparing the first quarters of both time periods. Annual revenue growth, when adjusting for foreign currency, declined, reports The Washington Post's Glenn Kessler, from 7 percent before she started to 3 percent when she left.

There's another problem with her growth. She bought it. She didn't organically grow HP's business.

As Andrew Ross Sorkin of the New York Times wrote in a column recently: "Here's the problem: Those numbers she is referencing aren't Hewlett-Packard's profit. They are the company's revenue. And if you make enough acquisitions - especially one the size of Compaq - you can inflate your revenue figures. You can also buy growth."

Growing revenue through acquisitions isn't the worst thing in the world. Businesses do it all the time. It's smart management.

But, Fiorina is running on a platform of cutting down the size of the government. There's no smaller nation she can go out and buy to grow the US's GDP.

Here's what she told CNBC: "I'm in favor of revenue-reducing tax reform. The government spends too much money."

Difficult relations with employees. Fiorina was accused of off-shoring thousands of HP jobs, and making the workers who lost their jobs train their overseas replacements.

Fiorina is also known internally as straying from the "HP Way," according to long-term employees. That's the egalitarian, decentralized system that became the company's core culture in its early years, according to the HP Alumni Association.

HP originally helped usher in the open-door, treat-employees-well Valley culture exemplified by companies such as Google and Facebook today.

Fiorina also has her advocates

Fiorina also has her supporters, people who like her stick-to-her guns style. In that same article from 2005 about the worst CEOs, Professor SP Kothari of the Massachusetts Institute of Technology praised Fiorinia's conviction in pursuing her strategy.

A former HP board member has recently come to her defense. Tom Perkins, the long retired founder of the venture capital firm Kleiner Perkins Caufield & Byers took out a full page ad in her defense, calling her a visionary. "Not only did she save the company from the dire straits it was in, she laid the foundation for HP's future growth."

Perkins is a controversial figure, too. He came to HP's board after Fiorina bought Compaq, a company he had invested in. He was a big advocate of the merger, it was a good outcome for him.

In recent years, he's been known for ideas such as comparing the persecution of rich people to the persecution of the Jews by the Nazis. He also once said that rich people should get more votes in elections.

Since her time at HP, Fiorina's business experience consisted primarily of board seats on a handful of companies. She also served as a spokesperson for Republican National Committee.