Perot

"At the time of EDS’s 1962 birth, the computer industry’s services segment (as opposed to the manufacture and sale of hardware) was limited to basic processes such as billing and payroll. “Service bureaus” collected data from their customers, processed it on their own computers, and returned it the following day. Perot’s innovation was to tackle more complex tasks, includ¬ ing installation of systems and management of the user’s difficult transition from manual to automated data processing.21 After landing a contract to develop a sales route accounting system for snack food producer Frito-Lay, Perot’s young company grew rapidly and quickly became profitable."

"Perot’s charisma accounted in part for the intense dedication of EDS engineers and salespeople. He inspired the troops with his tenacity, as well as mottoes such as, “Eagles don’t flock. You have to find them one at a time.”"

"He recruited self¬ starters like himself and let them operate with a minimum of bureaucratic rules. Authority to make decisions, Perot believed, must remain in the field, rather than at a massive corporate headquarters. (Electronic Data Systems had the world’s shortest procedural manual: “Do what makes sense.”)23"

"Studying the results of a couple dozen other high technology IPOs, Perot was struck by the amount of money typically left on the table. In many cases, the stocks had been priced at 30 to 90 times earnings, but doubled or even tripled on the first day of trading. “Those companies suffered an ir¬ recoverable loss by offering too low,” Perot concluded.26 Puzzling as well to a Texan weaned on horse-trading ploys was the cautious language of IPO prospectuses, which seemed to him designed to dissuade buyers. Se¬ curities laws required disclosure of every material risk in an offering, even some that sounded far-fetched to entrepreneurs."

"Perot discovered that the directors had not voted against the corporation’s chairman since the 1930s. Before long, he was ridiculing the board as Smith’s “pet rock.”"

"He declared in a press inter¬ view that the directors ought to buy GM cars, instead of receiving specially fixed up vehicles as perks, in order to understand the ordinary customer’s situation. Perot spoke of “nuking the GM system” by exiling managers from their expensive offices to the plants, where they would be close to designers and workers.37 He jabbed at GM’s huge capital spending program: “We are spending billions to develop new cars. This isn’t a moon shot; it’s just a car.”38"

"Horse trader Perot once again pressed his advantage. “I just kept making obscene demands,” he said, “and they kept agreeing to them.”41 When the dickering was finished, Perot had extracted a buyout price almost double the stock’s prevailing market quotation.42 The nearly $750 million proceeds to Perot represented a tripling of the value of his GM stake in the space of just two years (during which the company’s condition markedly deteriorated).4"

"As the center ofTexarkana shifted toward the new campus, the college became an important economic re¬ source. Not until years later did Perot publicly allege what he believed at the time, namely, that the owner of the originally proposed site was a friend of some of the board members. “I never surfaced that,” he said, “but I knew it and they knew it and they knew I knew it.” In years to come, reliance on damaging information to achieve an objective became a Perot trademark.30"