As accounting inquiries inch closer to the ex-CEO, once-confident CA customers are expressing reservations about dealing with a vendor with damaged credibility.Efforts by Computer Associates International Inc. to be seen as both a technology vendor and a trusted partner are in peril after a week of scandal-driven turmoil culminating with the company's top executive being stripped of his leadership position.
The board of directors' removal of Sanjay Kumar from his roles as chairman and CEO also robs CA of the most public face of what many users considered a renaissance at the company. As a trio of investigations into accounting practices inches closer to Kumar himself, once-confident CA customers are expressing reservations about dealing with a vendor with damaged credibility.
CA officials announced last week that Kumar had stepped down from the CEO spot and resigned from the board. In a move still being questioned internally at CA, according to sources, Kumar was given the newly created position of chief software architect. Lewis Ranieri, lead independent director on the board, was elected chairman of the board for the Islandia, N.Y., software company.
CA officials said that a search is on for a replacement for Kumar and that an interim CEO will be named.
According to sources close to the situation, CA's board late last week offered the interim CEO position to fellow board member Kenneth Cron, former CEO of Vivendi Universal Games. Insiders say that a permanent CEO will almost certainly come from outside CA and that the board could start making preliminary contacts with candidates as soon as this week.
Employees at CA said the executive changes—including Kumar's demotion—have been expected for some time. But many expressed surprise that the board allowed Kumar to remain at the company, even if only in an ill-defined, largely ceremonial role.
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