New CA Leader Restructures CompanyNew CA Leader Restructures Company

After five months on the job, Computer Associates president and chief executive John Swainson will unveil the New CA today. He is restructuring its business units and pledging "to restore the financial and business foundation of the company."

Swainson, a former IBM executive, was selected by the CA board in November to help restore credibility and trust to a company that had been rocked by prolonged federal investigations into illegal financial practices, which led to the firing or resignations of more than a dozen senior executives.

The restructuring revealed Tuesday are among the first major changes under Swainson's direction. The company has been divided into five business units to create greater accountability to business and customer needs. The business units for the first time will have individual profit and loss responsibility, and financial metrics for those units are expected to be disclosed beginning with its first quarter of fiscal 2006, which began this month.

"It's a simple vision in some respects," Swainson says. "We're going to focus on customers and building relationships. We're going to focus on the building of the culture of the company and making it a performance-based culture that values personal integrity, trustworthiness, and high ethics as its top priority."

Convincing customers of that cultural change may be a longer-term problem than getting them to support the changes it its business-unit model, says Ray Paquet, an analyst with Gartner. "The company had a mixed reputation before any of the [federal investigations]," he says. "Because their reputation precedes them, it's going to take awhile for the reputation of CA to improve and that will be one customer at a time."

Under the new management structure, the business units will report to Russell Artzt, executive VP for products.

The new units include: Enterprise-systems management, led by Alan Nugent, a former chief technology officer at Novell, who is now senior VP and general manager of the business unit. The unit will include most of CA's Unicenter software. Security management, led by Toby Weiss, a former senior VP for eTrust product management marketing, who will now serve as senior VP and general manager. The unit will focus on identity and access management, threat management, and security information management. Storage management, led by senior VP and general manager Chris Broderick. The unit will concentrate on integration with other CA products. Business-service optimization, led by Jacob Lamm, a former product development lead for Unicenter, who is now senior VP and general manager. The unit will leverage life-cycle and system-management technologies. CA product group, led by development executive Mark Combs. The unit will be comprised of products from a number of CA brands that fall outside the core areas of systems and security management. Other key executives will include Christine Glynn, senior VP of customer support; Yogesh Gupta, senior VP and chief technology officer; Guy Harrison, senior VP for business unit operations; Rob Levy, senior VP and chief technology strategist for CA's Center for Technology Strategy; David Luft, who will direct the small- to midsize-business program; and Gary Starkey, senior VP of the Executive Technology Advisors, a team that will work with CIOs to improve value from use of CA products. Dividing up the company into product-line-focused business units seems to run counter to industry trends, where tech vendors focus more on vertical industries than product lines, and customers say they want products and services that span a variety of technologies. But Paquet says it actually is in tune with the way customers continue to make purchases. "Customers say they want unified product architecture, yet their buying behavior is clearly in the opposite direction," Paquet says. "When you look at system and security management in particular, the number of point products purchased year over year for the past few years has increased significantly."