CA Resellers Weigh Impact of CEO Ousting

By Jacqueline Emigh  |  Posted 2004-04-26 Email Print this article Print
 
 
 
 
 
 
 

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Many Computer Associates resellers, while praising the quality of products released during the four-year tenure of Sanjay Kumar as CEO, nevertheless believe the channel could benefit under a new watch.

Many Computer Associates resellers, while praising the quality of products released during the four-year tenure of Sanjay Kumar as CEO, nevertheless say they believe the channel could benefit under a new watch.

Alan Dubla, president of Phoenix-based ADT Computer Solutions, is one reseller who said he hopes that CA's next CEO will be more oriented toward channel relationships in the SMB space.

"Kumar focused mostly on quality control. He left a lot of the channel decisions to lower-level staff," Dubla said.

"During this current IT drought, CA needs to start diversifying more into smaller deals," he added. "By working with big businesses so much, they're only getting a few big deals per quarter to announce."

Kumar's exit as CEO has some users worried about the company's future. Click here to read more.

Dubla said he thinks CA should aim its business more in the direction of smaller partners.

"CA carries a lot of baggage with larger companies, anyway," he said, naming factors such as channel conflict; acquisitions of partners and competitors; "aggressiveness and nastiness" in competitive relationships; and "general arm twisting" in structuring deals with customers.

But George Kafkarkou, CA's senior vice president for worldwide channel operations, was adamant that CA's relationships with channel partners have been on the upswing.

"CA's reputation among the partner community is at an all-time high. Our partners are applauding our focus on business practices that avoid conflict and promote success. They now see CA as a channel-savvy company," Kafkarkou said Friday.

"Our new business model, which is widely recognized for re-energizing our business, has helped to propel the channel momentum," he said.

Others were not so critical of the company's channel efforts. "Let's put it this way: Anytime a vendor is working with channel partners, there is the potential for channel conflict. The important thing is how this is handled," said Steve Pazol, CEO of Chicago-based nPhase.

Pazol also argued that it isn't essential for a CEO to be channel-focused, if others on the management team are geared in that direction. Pazol acknowledged, though, that he hasn't worked with CA for a number of years.

nPhase used to sell CA-Unicenter, but it switched to another vendor's product after CA decided to take Unicenter direct instead of moving it through the channel, according to the reseller.

With CA under investigation by federal prosecutors and the SEC, Kumar stepped down as the $3 billion software giant's chairman and CEO last Wednesday, under pressure from the CA board. Kumar will stay on at CA, though, in the newly minted position of chief software architect.

"The changes in Sanjay's role are not based on the conclusion that he engaged in any wrongdoing," Lewis Ranieri, CA's lead outside director, said in a statement. "Nevertheless, the conduct in question occurred during his tenure, and the board felt that this action was appropriate."

CA says it is developing new initiatives to expand its channel business.

The current investigation centers on allegations that CA misrepresented the timing of contracts in its financial statements in order to live up to the quarterly expectations of Wall Street analysts.

Click here to read about three CA financial executives who pleaded guilty to fraud conspiracy.

"We will name an interim CEO shortly, and we have launched a search for a permanent CEO," CA's Kafkarkou said Friday. Meanwhile, as CA's interim chairman, Rainieri has temporarily taken over Kumar's other former role.

The company has announced an interim CEO and restated its earnings. Click here to read more.

On Friday, CA's Kafkarkou dodged the issue of what traits the company will seek in its next CEO. "We are looking for the best possible candidate," he said.

But Kafkarkous also cited a new channel program launched last summer as one example of CA's commitment to the channel. He promised further initiatives as well.

"Our partners are pleased with CA's channel program and commitment. This is demonstrated by the unprecedented number of partners currently transacting with CA," Kafkarkou said.

"We are in the midst of developing and rolling out new initiatives that will expand our channel business and strengthen our support for partners and their clients."

Although critical of some of CA's earlier business practices, ADT's Dubla readily acknowledged that, since last year, CA's products and pricing policies have grown much friendlier to small resellers and their customers.

"CA's Secure Content Manager used to be heavy and hard to implement. It was limited to networks of 50 people and up. Now, though, you can use it on networks down to 20 people." Dubla said.

Other resellers concurred that a stronger small-business focus makes sense for CA at the moment. "Absolutely," said Jeff Snader of GXP Partners, an ISV and reseller specializing in pharmaceutical software. "We, too, have large customers and small customers. But more of our stuff is going to smaller companies these days."

Several resellers indicated that CA could do a better job of getting its story straight. For instance, Langhorne, Pa.-based GXP is listed as an affiliate partner on CA's Web-based Reseller Locator, but Snader maintained that his company has dealt with CA only once.

"We tested a demo unit of a CA product, but we decided to go with another vendor instead," he said.

Yet David Goldstein, who's listed on the same Web page, recently did make a decision to team up with CA.

"I'm not a very happy camper, though," said Goldstein, who is president of Aberdeen, N.J.-based davidthewebguy.com.

Goldstein claimed that CA led him to believe he'd receive extensive sales leads in exchange for attending a one-week training seminar in Florida at his own expense.

But Goldstein said that since returning home from the seminar, he's received no leads from CA whatsoever. "Whenever I've asked about the leads, CA has been very vague. All they've said is that if I send in a list of potential sales contacts, CA will qualify the leads for me."

 
 
 
 
 
 
 
 
 
























 
 
 
 
 
 

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