FRAMINGHAM – There was quite a bit of acrimony between IBM and CA in 2004. That April, CA’s Mark Barrenechea said software was an “afterthought” at IBM, and he called Steve Mills, the head of IBM’s software business and your boss at the time, the “VP of afterthought.” How did the conversation with Mills go when you told him less than six months later that you were going to take the CA job?
That was not an easy conversation, because I worked for Steve for 13 years. I have great respect for him. He has done an incredible job building a business inside a company that didn’t historically value software. There’s a nugget of truth in what Mark was saying — software was an afterthought at IBM at one point. Steve has changed that.
After the accounting fraud that took down your predecessor, Sanjay Kumar, did the board of directors adopt a policy stipulating that the positions of chairman and CEO would not be held by the same person atCA?
The board is indifferent about that. The practical nature of the situation is that you had to have the chairman and the CEO separate. The chairman’s role for the last two years has been, and will continue to be for a little while longer, to deal with the regulators, the legal issues, all of that sort of external stuff, leaving the CEO to deal with running the company. There may come a time when it makes sense to combine them, but in a time of crisis, it’s better to have them separate.
Have you met Kumar?
I met him twice — once in 1999, and once in 2000, and not since then. Interesting man.
Have you ever met CA co-founder Charles Wang?
I met Charles once back in the mid-’90s. Very difficult meeting. I have not met him since then, which probably says a lot.
Do you expect that CA will bring a civil suit against Wang, as recommended by your board of directors’ Special Litigation Committee?
We have not made any determination about that. The SLC gives a recommendation to the court as to how these cases should be disposed. Once the SLC’s report is accepted [by the court], then the company needs to decide what it does next.
In your view, what needs to happen for justice to be done?
I don’t know. And I say that very honestly. I do not know what should happen next. I think we’ve got to let the court [process] play out. On one hand, there’s sort of this natural inclination for revenge. On the other hand, the company needs to put this stuff behind it and move on. I cannot tell you where the board will come out on this. This is clearly not a decision I will make by myself. It’s a decision the board will make with due consideration of all the facts after the SLC report has been accepted.
The SLC concluded that Wang created a “culture of fear” at CA. Do you see any vestiges of that left?
No. The ghost of Sanjay is in the halls, but there’s not much of Charles left at CA. Charles has been gone a long time. By my estimation, only about 30% of [our workforce] was there when Charles was there. So there are more new people in the company than old; there are many more people who don’t know Charles than do. And Charles didn’t leave a big legacy. He had been disengaging from the company, as I understand it, for quite a while before he actually left in 2002.
In 2005, I wrote an editorial in response to your new vision for CA, which centered around what you called Enterprise IT Management. I said this: “That’s not a vision, John. That’s what your users do. All the time. Referring to it by the goofy EITM acronym doesn’t elevate what they do to a vision. It reduces it to marketing blather.” In retrospect, do you think I had a valid point, or was I completely off base?
You were completely off base. It is a very simplistic message — some might say too simplistic. It is astonishing to me how, in this industry, we don’t do the simple things well and to completion. We do lots of hard things partially. So the fact remains that no one to date had actually put forward a way to take the end-to-end panoply of stuff that people do in IT and figure out how to connect it, how to manage it, how to secure it or any of that stuff. So to say EITM is people’s job description is true. But they’re not doing it. And they’re struggling to do it with chewing gum and baling wire, and there was no vendor who was standing up and saying, “OK, I’ll take that on.”
In that same editorial, I faulted you for your decision to eliminate all 300 of your customer advocate positions worldwide. In hindsight, do you still believe that was a good decision?
That was one of my best decisions, and here’s the reason why: What was happening was that 300 people were the customer voice. And 5,230 [salespeople] were abdicating their responsibility. The sales force felt that because there were these 300 people out there, they didn’t need to worry about customers. And I said, “A sales force cannot not be worried about customer satisfaction.” And the fact that these people were out there, supposedly as the proxies for that, is a crutch. I took [it] away and said, “Now, every salesman’s first responsibility is customer success.” And it worked.
What’s the best decision you’ve made since you became CEO of CA?
I’m very happy with the management team that we’ve hired. It took time to find the right people. I’m very happy with the decision to create EITM, because I think it gave the company and customers a rallying cry. It gave us an umbrella under which we can put a lot of things. I’m very happy with some of the acquisitions we’ve made.
I think the reorganization of the sales force was a critical decision that we made at a very difficult time. If you remember, this time about a year ago we had really screwed up our whole commission process. While unrelated to the organization of the sales force, that was causing churn and consternation in the sales force because no one knew if they were going to get paid or how much they were going to get paid. We looked at that and said, “This is a big problem; we have to fix it. But at the same time, we also have a sales force that’s organized wrong — around products, not relationships. And since we completely screwed this thing up, we might as well take the extra time and organize it the way we want it.”
So we bit the bullet and did the reorganization of the sales team between June and September of ’06.
And the worst?
I told someone once that I thought we would have everything sorted out in a couple of years. That may not have been a decision; it was just a really foolish comment. And it certainly reflected a little bit of my naivet