CA chief heralds ‘new chapter’ for software giant

24 May 2004

LAS VEGAS – Computer Associates interim CEO Kenneth Cron claimed last night that the software maker’s problems were largely behind it and that the business was performing strongly.

“We’ve had some challenges recently,” he said, alluding to the ongoing federal investigation into CA’s alleged misreporting of revenues during the 2001/2 period. “The company’s internal investigation is now complete and we’re co-operating fully with the government and hoping that their investigation will end shortly.”

He added: “I’m committing CA to the highest standards of fiscal discipline and integrity.”

Cron has come from a publishing background – he owns several successful IT titles in the US – and is seen as a safe pair of hands who can steer the company out of trouble. A board member since 2002 but appointed CEO less than a month ago, Cron took over the reins from Sanjay Kumar who has been moved to the role of chief software architect. Other recent senior management changes at the company include the appointment of Jeff Clarke, a respected HP veteran, as CFO/COO and of Greg Corgan, a former IBM staffer, as head of global sales.

The executive team also includes Irish-born Una O’Neill, who leads CA’s fast-growing services business, which has 3,000 employees worldwide. O’Neill, a TCD engineering graduate who joined the business ten years ago and moved to its Long Island headquarters in 2002, told that company morale remained high despite the government probe into its financial affairs. “The company is financially very sound and there is a lot of confidence in its products and its strategy,” she said.

CA is due to report its fourth quarter and annual results tomorrow. The company has indicated that revenues will reach US$850m for the fourth quarter and US$3.28bn for the full year and that $1.25bn in cash will have been generated during the year.

Cron said the priority for the company in the coming year would be to further strengthen the sales channel. “Not every customer wants to buy from us so we beefed up the sales channel last year and it will be our number one priority this year,” he said, announcing the introducing of a new partner programme, ‘One Partner’, to achieve this. Traditionally strong with enterprise customers and government, CA hopes now to reach down into the fast-growing SME space through aggressively recruiting new resellers.

The new focus on partnerships follows on from a two-year programme aimed at improving customer service, the company’s Achilles’ heel in recent years. Cron declared that the drive had been successful, pushing up customer satisfaction from 46pc in 2000 to 75pc now, according to an independent poll.

The cloud of financial impropriety that hangs over the company has not been reflected in the size or razzmatazz of CA World, the customer, analyst and press shindig which is celebrating its tenth anniversary. Some 10,000 people are expected to attend the no-holds-barred event which is rumoured to cost tens of millions of dollars to host. It continues until Thursday.

By Brian Skelly