Charles

"say—then that’s another leverage. If we put this together with what we have, it’s a whole new product, going to knock the socks off the industry. But that’s just short-term. The strategic stuff has nothing to do with today. There are certain things we have to be in four, five years down the road. We better have the foundation built for those.”’ Charles’ clear goal"

"CA’s approach is not quick and dirty, however. It is more like quick and briefly noted. Just as Tony insists the company bal- ance its radical operational side with the kind of highly conserva- tive financial structure that in 1991 held $250 million in cash, Charles knows CA’s very informality demands an accurate and completely up-to-the-minute record of what is going on."

"this became the company’s number one priority. Charles: “The important thing is this can-do attitude. It’s a damn-the- torpedoes, full-speed-ahead, ready-aim-fire approach that says the hell with anything else, and it’s that kind of take- charge, we-can-do-it, nothing-can-defeat-us people who move ahead and it doesn’t matter where. In other companies, people with that kind of attitude don’t move ahead, they keep hitting this wall, and they pile up or leave. They leave—or get acquired, the whole company. Here that’s what gets people ahead. What kind of person succeeds at CA? I say self-moti- vated people. Hungry people, people who have been through a little pain in life. First-generation immigrants—they know, they've seen their parents struggle, people who arrived in this country with three suitcases, two suitcases. They’ve seen struggle, they've seen people go to school at night. They know. Something about Queens, Brooklyn people—they are so down-to-earth. You know the people. They come out of city schools, and there is something about them, there is a hustle in them, a thing that says, ‘I can do it, and if I can’t, Ill find a way—it’s not a big deal.’ That’s the kind of people who succeed. The ones who don’t succeed are the ones that come"

"Essentially there are two ways to add products: acquire the right to sell them or create new ones. Charles pursued both courses, but each had its limitation."

"Products already developed were often not quite suited for the market; those created in-house had a way of simply re-creating software that had already been created elsewhere. Charles syn- thesized the two: software produced outside was enhanced so as to work together with software already being sold or on its way to the market; software produced in-house was increasingly targeted toward creating the bridges that would allow diverse software to work together or toward filling product needs—say, three software programs needed two other entirely new pro- grams to create a comprehensive new product line. Charles:"

"Charles: “Tt all comes down to a couple of very simple things, which are: One, we ve got to get people. People who work for you. Work for you. But they’ve got to have reasons. They want to have a sense of career and that what they say has some impact. They’ve got to know their contribution has some meaning. You don’t want to work for something where you just punch in, be there for so many hours. That’s mind- less, and people will resent that, and that’s when you polarize groups. So you get them involved in decisions. Ask them. Make mistakes, but correct them, and make sure the people are always heard. The second piece of it is they want to have fun doing it. You’ve got to have a relaxed kind of driven. Driven but relaxed.”"

"Most American high-tech acquisitions vacuum up people with experience in fields the acquirer needs. CA, however, has never targeted talent. Charles looks instead for products to meld into CA’s software line, access to new markets, a customer base. Charles: “You look at the financials, you look at the product, you look at the sales. Then you ask, ‘How’s it all going to fit in to where we're going? How does this part make it all greater than just adding the pieces together? How do we leverage off what they’ve got or what we’ve got?’ If they have a product that I can sell through my sales force, God bless, that’s great, then I have leverage beyond what they have standing alone. If they need one piece for their product to"

"better have the foundation built for those.”’ Charles’ clear goal from the outset was to build the world’s best independent soft- ware company, and he had found the way. Nancy Li, senior"

"Charles’ dictum for success in writing software, famous within the industry—when a group of five programmers can’t develop a piece of software, remove the two weakest—is based on a simple idea: good is an obstacle to great. But it won’t work unless you have the great."

"he lists his assets: people. Charles: “What I do is write my priorities. Let’s say I redo a development area. I start off by saying I have nothing. What’s my most important product, what’s my strategy in this area? I always ask myself, Why are we marketing this product? We have a sort product, CA-Sort. Why does one use a sorting product? And I'll start to ask the questions, go through the process: ‘OK, why do we do this? Is there a future to this?’ Maybe we shouldn't be investing as much into it. Or what is the optimum we can invest? What do we have to do next year, guys, to keep the sorting market just the way it is, assuming no new sales? What would it take to do that? You say, “Half-time one person will do fine.’ OK,"

"business is structured for stability, not performance. Once you structure for performance, it becomes immediately clear that a way must be found to discover which employees per- form best. Sure, most companies go through a rote, ubiquitous employee evaluation, where on a_ one-to-five continuum everyone turns out to be a three. Great, but how do you know which threes are the best threes? You don’t. At CA, employees are ranked: she is number one in this group; he is number two; he is number three, and on down. At CA, em- ployees are ranked against each other. There can be no other meaning for best. Charles: “And always be bluntly, brutally"

"“Stars, we're always looking for stars. ‘Where are the stars?’ We're always asking this question, and always looking.’’ Con- sidering that a pro quarterback’s value diminishes rapidly after about six years, and considering as well that a star programmer becomes more valuable every day for up to forty years, the CA programmer makes and earns far more. Charles: “You've got"

"ments about other people. Charles: ““I rank them, I tell them. Yeah, and if you screw up, I'll put you in the penalty box for a while. I’ll tell you you screwed up and that’s why you're there. Now, learn something while you’re there. And if you don’t like it, leave—because CA doesn’t need you and you don’t need CA. You’re talented, go somewhere else where you love it. You don’t think we love you, but I’m going to tell you exactly where you stand. I don’t think there’s anything wrong with that. I tell people to treat their people the same way. But here’s where even we get wishy-washy, back and forth. Someone says, ‘This person is the worst person I ever had.’ Then he says, “He is probably the best employee I ever had.’ Come on, you said he’s bad—he’s bad. But now sud- denly he’s the best? Come on, these cancel each other out. This is a meaningless piece of bull, this report. “Why’d you bother putting anything down there in the first place? Oh yeah, you've got to check off because you have to fill out the form, but that’s not the purpose of that form. The form wasn’t meant to be filled out so that everybody’s file has this form signed by a manager. That’s not the purpose of it. The pur- pose was for you to face the issue of telling your person where he stands in your organization.’ This is a long story at CA. We"

"Charles: “We’re a mostly sales- and marketing-driven com- pany. We put it together with marketing more than other companies, so the development people can develop what the marketing people want, what the salespeople say is required by their clients. It’s straightforward.’ Equally unsuitable were"

"Reorg could not be more simple. Because the company’s produc- tive assets are people, not machinery, CA’s only constraint in reinventing the system to use them most effectively is the cur- rent product base, which must still be sold and supported. Charles calls this “zero-based thinking,” as against zero-based budgeting. The latter assumes the corporation is already doing the right thing, while the former determines what the corpora- tion should be doing and only then begins to allocate resources. Zero-based thinking is actually start-up thinking, but with none of the constraints: a functioning company is already in place, replete with product line, established clientele, dependable sup- pliers, to say nothing of solid credit, positive cash flow, money in the bank, and trustworthy personnel. So why change it?"

"Diagram 2 is CA on its way, with Charles at the center of a circle of trusted colleagues, each happily managing a function of the company: development, marketing, sales, administration, fi- nance, international, or whatever else was thought important enough at any given time to be so singled out. Notice that this is not a wheel at all, but something more like a Roman candle, with the force of management exploding out from the center to an ever-receding collection of the same kind of rigid structures CA was earlier trying to escape. True, Charles and his circle are able to communicate like crazy, but everyone else is frozen out into the farthest reaches of Pyramidville."

"managing people. The product-owner has to make sure he’s got the appropriate people, that he’s got a team, and that the various responsibilities get met.”’ It was a form of neo-Darwin- ism. Russ: “But not everyone’s cut out for it. It’s a new concept that we created here, and it really takes a well- rounded, versatile individual. It’s got to be someone who's technical. He’s got to understand the vision, where the prod- uct is, where it’s going. Good with people. And support ori- ented. And development oriented. So we look from within and say, ‘OK, who deserves this shot, who might be good?’ And as talented as he or she may be, sometimes we find that this isn’t a product-owner, so they might be best going back to what they were doing before, being a development leader for instance. He might be very good at that, but not a very good product-owner.”’ Natural selection. As the framework evolved, product-ownership took on a tensile strength within CA. Product-owners became responsible to superproduct-owners, who themselves became responsible to what can only be called mega—product-owners—the ultimate product-owner being Charles. Little wonder that the product- owners who succeeded took on the characteristics of Charles himself: extremely technical, marketing-sensitive managers who could motivate and lead people and who kept their eyes on the details while shaping the vision. With this sort of manager, a skein of “ownership” cut through the entire structure of devel- opment, marketing, and support at CA, functioning not as a"

"no longer product-owners.’’ When product-owners couldn’t do the job, products were orphaned, whole staffs left directionless. Charles then had two choices: (1) bring in a new candidate for a product that had already defeated others, or (2) move the product under the aegis of an already successful product-owner and have him supervise new product-owners as a superproduct- owner. Either way, product-ownership became a litmus test of managerial talent. Russ: “You're running a product almost like"

"When it is a case of someone not being able to do the work, however, the stick that CA wields is loss of responsibility, per- haps with a couple of chances at other jobs. Charles: “Just don’t pass around the turkeys.’ But only up to a point. A middle manager: “This is not the kind of place where you virtually have to murder someone to get fired. What I really like about CA is it’s almost like winning. It’s like only the best survive. What you have left is very brilliant people.”"

"CA had found a way to put together the best combination of human talent at the level that counted most: the product level. This was simply a ramification of Charles’ original logic. To make money, you need products; to get products, you need people—but you had to get the right people. They actually had to love working in such an exposed situation—virtually a guillo- tine—because if the blade doesn’t fall, the same individual moves to a shady spot under an even larger blade, where he or"

"meaning for best. Charles: “And always be bluntly, brutally honest with your people. You screw up, I tell you you screwed up. ‘Now, tell me how we're going to do it so next time we don’t have this problem, and what did we learn from this?’ Or it could be, ‘OK, you did great, kid. You did great. I can’t believe you did it, I didn’t think you could, but you did great.’ Tell them! If you don’t tell them how you feel, how are you going to expect anything from them? It’s not faire"

"It reminded me of Sumner Redstone’s fierce dictum: never cede or sell control. When you sell you give up being on center stage. Edgar’s uncle Charles, after they sold out to Vivendi, said, “All my life wherever we would go, when the plane landed there’d be a Seagram representative at attention on the tarmac to greet us, and we’d roll into the city royally. Now all I am is just another rich guy.” I was very grateful to Edgar for having given me the chance to build up his television assets and was really sorry we’d become estranged. Thankfully, over time we repaired our relationship and will always be good friends."