"Nearly five years ago, with the advent of the partner program, we transformed from a ship on our own course to a member of the fleet," states Computer Associates (CA) vice president of marketing, Carl Hartman. "At that time, we were not viewed as a company that partnered with anybody. We recognized that things were changing, the dynamics were shifting a bit and that regardless of how hard we tried, we'd never be able to give everybody everything they needed without partnering. Our chairman, Charles Wang, asked me to head the partnering efforts. In approximately nine months, we launched the program. A year after that, we had hundreds of partners integrating with our technology and bringing solutions to market for our customers. I'm proud of the fact that in a compressed time frame under a fair amount of pressure, we really executed and built a team and a program and got enough traction around it that it's still thriving today. While the advent of the partner program was significant, this year our company has exercised an even greater sea change."
The CA sea change of 2001 has three components product, advertising and financial. Product-wise, the company that develops solutions for all business intelligence needs now has a slogan to address their coverage: The Software That Manages E-Business. Hartman elaborates, "We ordered our offerings into three strategic categories and six core solutions now known as our '3x6 Strategy.' The three strategic categories are e-business infrastructure management, e-business information management and e-business process management. Management means many things to us including the management of the infrastructure all the devices, applications, databases and networks that people have; management of the information that lives on top of that infrastructure; delivering it to the right people; and doing this all in support of the business processes that an organization has in place. Across these categories, CA delivers market-leading solutions in enterprise management, security, storage, e-business transformation and integration, portals and knowledge management, and predictive analysis and visualization."
According to Hartman, the rationale for the reorganization is as follows, "We consider all six core solutions to be areas of growth. While we are the number-one vendor in the infrastructure management space, security and storage are explosive growth areas for us. On the information management side, we look at the tremendous need for integration and the desire of companies to transform themselves into e- businesses which is really driving the market right now. On the intelligence side, portals represent an exploding market utilizing portals to build effective knowledge management in every company is sort of a holy grail. We're also developing some unique technologies in the predictive analysis and visualization space. We've rallied our company around these areas, and that's really what's driving us forward."
In the advertising sector, the company's software that was branded for 24 years as "superior by design" adopted a new slogan and a new logo as the company sought to increase awareness. Hartman continues, "Our new look is friendlier and more modern. We're not a small company and we're reasonably well known in the IT world; however, outside of this world we're not that well known considering our size, history and solutions. We're not on the tip of people's tongues as some other companies have been. Perhaps you've noticed that over the past six to nine months we've opened up considerably we're advertising on television which we hadn't done before, we're doing more in terms of print and getting the word out from an advertising perspective. We're also doing more public speaking engagements at industry events."
In the vein of change, including the product organization and advertising, CA introduced a new business model. Hartman notes, "The new business model impacts reported financial results because product revenue is recognized ratably, over the life of the contract, rather than aggregately at the beginning of the contract. To help investors better understand the value of the new business model, CA created an additional measure residual value which represents future revenue streams from committed contracts with the company. For this reason, we have provided pro forma results to reflect CA's performance as if we had always been operating under this new business model which provides for meaningful year-over-year revenue and operational earnings comparisons." On a smaller note, but also worthy of mention, CA became the first global enterprise software company to receive ISO9002 certification.
While the changes within CA this year were radical, the concept of change is not. Hartman speaks of the company's environment, "There are several ways in which we're unique as a company. We've been around for 25 years not many technology companies share this tenure. Yet, the amazing point is not that we can stick around for 25 years. Rather, it's the reason we've been around for 25 years which is our ability to change. We are culturally an organization that continually changes. Once a year, we reinvent ourselves it's called zero-base thinking. The premise is: Last year was great, congratulations on a job well done, but we're going to begin planning for this year from scratch. What do we have to do to be successful going forward? We move people around and we move organizations around. And we don't just change once a year. There's continual change following the zero-base thinking. We continually refocus."
That's just a glimpse into the culture that defines CA. Hartman elaborates, "We are results- oriented and entrepreneurial. We believe that you should try things, and if you make a mistake, fix it and don't make the same mistake again. We're not a rigid structural organization; we don't have the typical pyramid of top-down management. We've been described as being more like a solar system where we all revolve around the executive management team. However, the difference between CA and a solar system is that sometimes our planets collide. I run into Mars every now and then, and our orbits change a bit. Conflict and change are both part of growing as a company. We're serious about our business we are, have been and will continue to be successful yet the atmosphere is relaxed. Even our chairman encourages employees to do something different if they're not having fun."
Hartman continues to expound on the merits of the company. "I also think that we're better at integration than any other organization in technology. We obviously have grown through organic means as well as acquisitions. On day one following an acquisition, you'll know whether or not you have a job with us; this is unique in a world where many organizations keep employees guessing for insufferable periods. Our method may sound cold, but at least it's clear and allows people to plan for their futures. We integrate people, we integrate cultures, we integrate technologies and we integrate process very well. When we talk to companies about integration, we know what we're talking about because we do it ourselves. Another key to our success is that we're able to understand and personify how to grow a company, get things accomplished and make it all work together very well," acknowledges Hartman.
CA customers do not appear to be inconvenienced by the integration. In fact, quite the opposite is true. Hartman explains, "Nearly every company has some CA solution, and most CIOs that we work with don't want to interact with 30 or more vendors because that's too much of a headache. The CIOs want a handful of trusted partners they can work with on a daily basis to solve business issues and drive them where they want to go. Because of our relationships that we have built over time, we are becoming a trusted partner of many companies. We have a vast technology portfolio and a great ability to partner, listen to our customers' goals and determine if our technology can help them achieve their goals."
While integration may be a smooth process at CA, the company has not been without turmoil most notably, a recent proxy battle. Hartman notes, "I think the fact that more than 75 percent of the shareholders sided with Charles Wang is a recognition that we're doing the right things as a company that we're very serious about customer service, aligning ourselves with our customers' needs, providing to them the kinds of technologies they need. I think it's a recognition that the current executive and management team of the company is the right one to take CA into the next 25 years. We have challenges, we make mistakes we admit that, but we are working diligently to fix them. Our spirit has always been very entrepreneurial, and we will proceed this way. We're all relieved that the majority of shareholders determined that this is the case. Yet, that's not to discount those who didn't. We want to work with them too and have them become stronger supporters of the organization as well. We have work ahead of us, but we feel we're heading in the right direction."
Additionally, CA does not pretend to be immune to the downturn in the technology sector; however, Hartman is confident about CA's position. He states, "This year especially, we've been able to weather the storm better than most companies in technology because we find that our customers, although they're looking very carefully at how they're spending their IT dollars, are not stopping spending. The smart companies are continuing investments in IT because in the long run, it's going to be a cost-effective way to do things. We're going to be able to make people more productive. You're going to be able to use our technology to do things that perhaps you previously had people doing by rote, thus freeing them to do more strategic things for you. We find that our customers are still spending they're doing it carefully, they're justifying but spending on IT is not going away. Hopefully, we're going to start to turn the corner."
Hartman came to CA as the result of an acquisition on May 25, 1988. Since that time, he has held positions ranging from marketing and development to managing a line of accounting products to working directly for Charles Wang. Hartman's 20-year plus tenure in the industry permits the following observation: "Any business that's not using technology to support what they're doing is a dinosaur and probably nearing the end of its life span. Consequently, every organization is using technology and that's really what e-business is all about using technology to support your business and your processes, to find new opportunities and to do better what you already do well."
It's been quite a year for Computer Associates. Hartman concludes, "We're a $6 billion company and the fourth-largest software company in the world. All we do is software, and that's all we've done for 25 years." For CA, the future presents a sea of endless possibilities and everyone at CA is dedicated to setting the course and ensuring smooth sailing.
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