Interview: John Swainson, CA's new CEO

John Swainson, who was named CEO-elect of Computer Associates International Inc. last week, spoke with Computerworld reporter Matt Hamblen about his new post, the decision to hold CA World next year after all, his review of CA management products and ethics reforms at the company.

What's it feel like to leave IBM after 26 years and suddenly be CEO-elect of a major software company?

It's a little daunting. You come in and know nothing and nobody ... having arrived from an environment where you know everybody and everything. You are allowed to have that ignorance for 24 hours. It's a little intimidating, to say the least. I'm delighted to work with the CA team, and it's a great team and very durable. They've been through a lot, as you may imagine.

They have maintained a strong sense of morale and responsiveness to customers. My job is to shape an evolutionary path of growth after several years of arrested development.

Are customers concerned about the legal problems that CA mostly settled in late summer?

The past is past, and I separate customer (relationships) from some of our legal problems. I'm a very customer-focused guy, and if customers bring up our relationship as a problem, from my point of view, we have broken customer trust. I am not yet in the position to assess customer relationships. I'm not so naive that we don't have to deal with how customers see us. Really, the direction of my comments is that a lot of the legal and self-inflicted wounds are in fact behind us. A lot, but not all.

I'm sure you've heard customer attitudes about CA even while you were at IBM. What are their feelings about CA?

CA customers are relieved the issues are behind us. I'm not going to pretend I know how all of them feel yet. I have not done a broad enough survey, but by virtue of the fact they have hung with us and are anxious for us to succeed says something. I want to give them a continued reason to justify that optimism. I firmly believe at the core of this company we are a software development company, and we need to develop great products and tell our customers ... what we're doing in developing great products. We'll say, "Here's something you can trust." Our customers right now are watching and waiting to see what we do next. We have to still prove to them we are a relevant vendor to them. It's not a slam-dunk.

Have you met any CA customers yet, and do you plan to set up customer sounding groups to meet with like other CEOs do?

In two or three weeks, I'm trying to see all of them at a customer conference coming up in Washington, D.C. I plan to talk to or meet with one customer every day, something that I did at my old job. Sometimes it is a phone call or often in person, sometimes I get my quota for the week in a day. I don't feel good if I don't talk to a customer every day. I am a very customer-focused guy.

Where do you rank customers compared to, say, investors or employees in your priorities?

Customers pay the bills, so at the end of the day, customers always come first; they even come ahead of investors. You can not build a durable business if you do not have satisfied customers.

Speaking of satisfied customers, I've heard some of them are very concerned by a CA marketing letter that went to them saying CA World would be postponed from 2005 to 2006. What do you say to them?

We are going to have a CA World in 2005. The team was concerned that the way we were tracking, it would be very difficult to have me stand up at CA World in spring 2005 and articulate a strong strategy for the business. Last year, the interim CEO stood up and did say something at CA World, and he said we're stabilizing the business, but he was placed in very difficult job. I need to go out and say here's what we're doing and our strategy. We felt we couldn't do that without postponing.

So you are holding CA World after all in 2005? Were you involved in the postponement decision?

The decision to postpone was made pending my arrival, when I came aboard, and I supported that decision. Yes, we are looking now for dates in the fall (of 2005). I am anxious to do it. I like these things.

It will be run by an outside group, and not CA staff?

Yes, there was some restructuring internally. We'll have to be reliant on outside people for logistics and other things. It's going to be a business-oriented and strategy-oriented and education-oriented CA World. We'll ... turn it into something that really does live up to its reputation as a conference for infrastructure management professionals.

Even some CA officials disagree about how many products you have, but you talked the other day about examining the 500 CA products for priorities. What might stay or go?

No one quite knows how many we have, but when I say 500 products, it really refers to 500 product families. What might stay or go, I have no idea. That's the honest answer. But I'll tell you how I am approaching this problem philosophically. I'm not looking to dump products, and (I) have a commitment to support customers on going-forward basis. It's logical that of 500 products, not every one represents the strategic future of how customers want to build or run or manage their enterprise. Life-cycle and systems management and security are very highly valued under the banner of enterprise infrastructure management. We're looking for ways to integrate those (priorities) and augment them through acquisition or development and to really concentrate on the things we're particularly good at.

Will you continue to place a reliance on mainframe products, even though some financial analysts see that market slipping?

Mainframe products account for 50 percent of CA revenue, I believe. What I described is a pretty reasonable strategic direction, and inside each of these priorities, there are a variety of products, and some are mainframe and some are distributed. Quite obviously, we'll continue to focus on (the) mainframe, and we believe it's a very durable long-term platform for a lot of things. Mainframes are not going away. IBM is selling more than at any time in history, and they're going gangbusters. We'd be crazy not to focus on mainframe. But you die if you don't continue to innovate and go forward. We want to be the systems and security management leader around mainframe, and we'll continue to invest in it.

We also have to focus where growth is. Windows, Linux and distributed systems are where the growth is, and we have solutions for those. ... Our play is integrated solutions around the enterprise. It has to be a heterogeneous solution and include Windows and other things.

You're including wireless, for example?

Wireless devices are increasingly a part of the enterprise infrastructure. You have to be able to manage them. In retail, they are becoming absolutely ubiquitous.

So, back to the events that led to Sanjay Kumar's departure and ultimate prosecution. Have you gotten your new ethics official or whatever the title is as required?

As part of the third prosecutorial agreement, we will add a chief compliance officer, and we are in the process of finding someone that has the right profile and gravitas to be able to do this job. We agreed to add new independent directors to our board of directors. We just added Laura Unger to the board. Next year, we will establish a comprehensive compliance program.

So when is the compliance officer coming aboard?

I do not have any idea when we will have the compliance officer. I learned a long time ago that it is impossible to predict when these things will close.

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