Computer Associates International Inc. President and CEO Sanjay Kumar encountered a hostile audience and pointed questioning when he appeared for a keynote session at Gartner Inc.'s Symposium/ITxpo in San Diego but defended his company against all charges.
Gartner analysts opened the challenges to Kumar and CA by asking the audience of nearly 2,000 information technology executives about their perceptions of the Islandia, New York-based software vendor with an estimated 60 percent to 70 percent of the audience saying they viewed CA negatively.
Gartner analysts Betsy Burton, the IT consulting group's vice president and research area director, and Raymond Pacquet, vice president and research director for Gartner's enterprise management service, questioned Kumar on recent changes CA has made in its method of accounting revenues and business model which promotes purchase of CA products on a subscription basis.
Kumar declined to discuss some aspects of CA's past accounting which are currently under investigation by the U.S. Attorney for the Eastern District of New York, the FBI and the Securities and Exchange Commission.
He also blamed some of the perception of problems at CA on former executives of the "legions of companies" which had been acquired by CA in the last dozen years and which were given "platinum parachutes" or other severance fees sometimes amounting to millions of dollars.
"In every one of the acquisitions there are lots and lots of people who have a parachute," Kumar said. "Very few say anything good about CA once they have left." The CA executive said customer perceptions of problems are also a result of the acquisitions, which he has halted in the two years since taking over as chief executive.
"Customer service issues are a nasty byproduct of acquisition. It's not something people often talk about," he said, adding that CA has put emphasis on improving customer service. "It's not only a perception. I think there is some reality behind the perception," he acknowledged.
Kumar said he disagrees with equity and technology analysts who have questioned CA's revised accounting methods and said he believes CA's accounting methods are proper. Very few customers have questioned either the accounting problems or switched to a subscription-based business plan, he said.
"Ultimately the buck stops with me," Kumar said. "If customers are unhappy they should call me. If there are issues out there I guarantee we'll go about fixing them."
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