You'll find an HP 12c calculator perched on just about any money manager's or financial planner's desk. It's HP's longest- and bestselling product — and the go-to tool for anyone in finance. And you can thank behind-the-scenes leader Dennis Harms for bringing it to market.
Harms, now in his late 70s, is best known as the project manager who spearheaded the production of the HP 12c financial calculator. It's still sold today — 43 years after the launch — an eternity for a tech product. The Museum of HP Calculators calls it: "The calculator that wouldn't die."
The now iconic calculator, with its unique horizontal shape that by design fits in a shirt pocket, solves math problems for real estate agents, investors, loan officers and business school students who need answers fast.
"I'd like a dime for every time it was asked to me: 'Why did (the HP 12c) last so long?'" Harms said when the calculator celebrated its 30th anniversary. "We thought it would have a two-year life span."
Create A Product That Fills A Real Need
Like most of the world's most famous products, the HP 12c filled a need. Then and now.
Prior to the HP 12c's launch, many financial calculations were done manually. Forty years ago, Harms recalls, real estate agents would carry a big book around. Tables showing interest rates and how much a monthly payment would be based on the loan amount filled these books.
"The magic of the 12c is that you could do away with the book and tell the homebuyer what they have to pay per month really fast and accurately," said Harms, who joined HP in the early 1970s.
Today, the HP 12c remains a useful and popular tool for pretty much anyone who needs the right answer to a numbers-related question. The calculator is the de facto standard in finance. In fact, it's the approved calculator for both the CFP and CFA certification exams.
Sell A Product That Lasts
In an era of planned obsolescence where smartphones are replaced every few years, the HP 12c is unique for its longevity.
Despite being introduced in 1981 when Ronald Reagan was president and Pac-Man became a cultural obsession, the HP 12c is still in production under its original name and model number more than 40 years later. And it is selling briskly. You can still buy a brand-new HP 12c on Amazon.com for $39.99, a retailer that didn't even exist when the device hit retail stores at an initial price of $150.
Customers want the best. So, giving them a product as close to perfection as possible should be the goal. Harms and his team were tasked with must-have features by co-founder Bill Hewlett and the other top HP executives.
For the HP 12c to be successful, all of the calculator's calculations had to be precise. The HP 12c had to fit in a shirt pocket. Its battery had to have a long life. And the calculator also had to be virtually damage-proof if a user dropped it, banged it or it fell victim to any other accidents.
The predecessor to the HP 12c, the HP 80, required a big recharging unit that plugged into the wall, according to HP. The HP 80 was too big to fit in a shirt pocket. Back in the early 1980s, that was a high-tech endeavor.
That meant improving what needed improvement. And fixing what was broken, says Harms.
Stick With The Challenge
It took about three years to get everything exactly right with the 12c.
"They kept telling us 'We need one more thing,'" Harms recalled. And his team gave the higher-ups just what they wanted.
The team, for example, made a slight adjustment to the calculator's case to fit in a third battery to extend its life. (The new tilt of the calculator case while sitting on a desk also made it easier to read and use.) And to save power and make the HP 12c more readable outdoors, Harms and his team chose the then-new liquid crystal display (LCD) instead of LEDs (light-emitting diodes). The team also switched to a new semiconductor that reduced the device's power use.
To make all the keys fit and make the calculator more like the adding machines people used at the time, the design team laid out the calculator in a horizontal position. The attention to detail included color, too. "The gold-on-brown colors gave the little calculator an air of seriousness and value that made it a status symbol sitting on a desk," HP said.
"It had that sort of jewelry industrial designer look," Harms said. "It was something that a business millionaire would want sitting on his desk."
Build To Last
The team made sure the calculator was virtually indestructible. And by one account the HP 12c was bulletproof. A zookeeper who used it to calculate feed mixtures dropped it and it was consumed by a hippopotamus, according to The Museum of HP Calculators. But the HP 12c lived. "The calculator survived the hippo's digestive process as well as the washing that followed," according to the museum.
The HP 12c also passed HP's legendary drop test. When engineers at a Japanese company supplying the LCDs were skeptical about the calculator's ability to withstand drops, a division manager took a 12c prototype and dropped the shoulder-high calculator to the floor. It bounced a few times. But it survived.
And when it comes to battery life, the HP 12c keeps going. At least one ran for 30 years on the original set of batteries, the museum noted.
Tap Your Childhood
Harms' get-it-done-no-matter-what attitude and mechanical aptitude started as a kid. The Iowa farmboy helped his dad repair the family's hay baler, tractors and other farm equipment with the help of an owner's manual.
"I'd pull out the manual for the baler and figure out all the places you'd grease it, how to fix it, how to get it to tie the bales," the now-retired Harms told IBD.
But Harms started his career at HP "rewriting internal math routines for calculators to make them more accurate." HP's first calculator, the HP 35, suffered from rounding errors due to technological limitations. Harms says he enlisted the help of William Kahan, the University of California at Berkeley's renowned expert of numerical accuracy.
The math whiz and Iowa State University Ph.D. recalls the pressure of working on the HP 12c project that late-HP co-founder Hewlett was behind. "Everybody at HP knew the co-founder had a warm spot for calculators," HP noted in 2006 to mark the 25th anniversary of the 12c. "It wasn't unusual to have him drop in at the labs and punch buttons on test models to see how they were coming along."
In fact, Harms remembers the day that "Bill Hewlett called my boss and said, 'Don't screw it up.'" The HP founder, though, let the team know that he would give them all the resources they needed to succeed.
Don't Sacrifice Quality — Ever
Before you can roll out a new product, you must make sure it's built to last. Quality was important. Quality defects were not acceptable, according to the so-called "HP way," says Harms. So, if something wasn't perfect, Harms and his team dug into the reasons why. And they fixed it.
"Every failure was analyzed," said Harms.
For example, Harms saw a problem with the soldering of the chips to the calculator's memory board. He tracked the issue all the way back to the manufacturing process. HP helped the company fix the problem.
Don't Work In Silos
Harms' job was to perfect the HP 12c. To do that, he didn't turn down help from others who could help him. And he listened to what others had to say.
He got out of the lab and met with whoever could help him make the calculator better.
"I actually talked to the sales team about the design of the product," said Harms. "And I listened to them and realized the contributions that they made. They were right there with us."
With input from the sales team, Harms says he added features to the HP 12c models sold in Europe and Canada.
Harms was a techy math guy, not a Wall Street investor. So to enhance the calculator's bond functions, he traveled to meet with bond market experts to talk to them face-to-face. "I can remember sitting in the (Transamerica) Pyramid building on one of the top floors talking to a financial expert on bonds," he said.
No one person can accomplish great things on his or her own, says Harms. "You have to listen to the input. You can't let your ego get in the way and just do it your way."
Dennis Harms' Keys
- HP product manager of the 12c financial calculator, the company's best and longest-selling product.
- Overcame: Technical limitations to create the perfect product for financial professionals.
- Lesson: "Whenever we hit an obstacle, we fought our way through it."
