CA's stabilizing force

Ken Cron is moving confidently, getting down to business at the beleaguered Computer Associates

BY MARK HARRINGTON
STAFF WRITER

July 26, 2004

After a whirlwind tour of Europe and two days of town-hall-style meetings with employees in Islandia, Ken Cron, tanned and beaming, plunges into his new corner office overlooking miles of Suffolk County and declares the door "open."

For the affable, diplomatic Cron, who accepted the title of interim chief executive of the traditionally insular Computer Associates, the moment is rich with symbolism.

After two years of federal investigations, unexpected resignations and a roller coaster of making news, embattled Computer Associates can see the beginning of the end of its nightmare. (Cron said CA is in the "final phase of settlement discussions," and believes the company can "conclude [accounting probes] in a constructive way.")

For Cron himself, who grew up in a bay-front home in East Islip, the position at the helm of CA is one that appears an increasingly comfortable fit.

So much so that some are beginning to wonder whether he won't nix interim from his title and stay for good.

"Kenny's a really good manager; people like him," chairman Lewis Ranieri said in a recent interview. "From a morale point of view, he and Jeff [Clarke, the chief operating officer] have done a spectacular job of getting everybody focused back on work. I'm a little proud of myself, because I'm the one who wanted him."

Asked if Cron's a candidate for the permanent slot, Ranieri said, "Yes. Ken is doing a good job, and we will look at all alternatives, including him and the job he's doing."

Cron is seen as a stabilizing force at a company left rudderless after the successive departures of founder Charles Wang in 2002 and former chief executive Sanjay Kumar in June -- predecessors he's quick to credit for creating and building a "great company."

More recently, Cron has begun tweaking and defining his management teams, giving new levels of responsibility to trusted lieutenants, assuring employees that better times are ahead and getting down to the nitty-gritty of growing a business that's been flat the past three years.

"We're ready to move ahead," he said. "Now it's about growth plans, opportunities and new markets."

Taking the job in the first place wasn't easy. Cron last April left a daylong board meeting to pick up his children at school. The prospect of Kumar's resigning was head-spinning enough. Other board members continued discussing who might replace Kumar and decided on Cron after hours of deliberation. The persuasive Ranieri called him late that night with an offer he could not refuse. Cron tentatively accepted, but finalized his decision after several days' deliberation.

With the company's annual giant user conference, CA World, weeks away, lawyers and investigators tapping at the door and a beleaguered work force thirsting for leadership, Cron underwent a "baptism by fire."

Working as a team

No propeller head, Cron came to depend on CA's "deep bench" of techies to get him through the technical thicket, on finance whizzes Clarke and controller Doug Robinson to crunch the numbers and concentrated himself on CA's management structure, its employees and its growth plans. Executive vice presidents Mark Barrenechea and Russell Artzt, and chief technology officer Yogesh Gupta are overseeing a newly formed technology team to work on product vision.

"I now have a team that feels empowered and responsible for results," Cron said.

"We're working well as a team," said Artzt, adding he'd be happy if the board selected Cron. "Ken is the kind of guy who comes in and doesn't sit in his office. He walks around the building. He's very conscious about being very approachable. He wants people to get to know him. There's a lot of good communication."

Brooklyn-born, Cron attended East Islip High School and raked clams in a small Boston Whaler on the Great South Bay four days a week for pocket money.

He went on to the University of Colorado at Boulder and after graduation lived in California before returning to Long Island.

Here, he took a job with nascent CMP Publications, an electronics publishing concern in Manhasset run from the home of the Leeds family. He steered the company into the computer field, rose through a 21-year career to president and helped sell the company for nearly $1 billion in 1999 to Miller Freeman.

Workers aren't sold on Cron

Cron launched an online gaming company, Up roar.com, which he turned into a $140 million windfall when he sold it two years later to French Vivendi Corp. He stayed on, eventually to become chief executive of Vivendi Universal Games. There, he mingled with the kings of media, Jean-Rene Fourtou of Vivendi, Barry Diller of InterActive Corp. and Sumner Redstone of Viacom, who recently named him non-executive chairman of Midway Games in Chicago. Cron stressed the latter role's board-only involvement.

"I'm not moving," he stressed, saying his interests have long remained media, entertainment and technology.

But some employees are worried he either won't stay or doesn't have the technological grounding to create a lasting vision for CA that employees can rally around.

"We're not taking Pork Chop Hill," one veteran said, noting that headhunters are combing CA for easy recruits. What the company needs now is a hit product to unite and boost the team, he said.

Newcomer Clarke said he would take exception to that view, and pointed to the company's recent relatively positive financial earnings pre-announcement as a sign new management has a firm grip on the business.

A supportive culture

"What employees, shareholders and customers are seeing are decisive actions," he said.

Asked how he'd feel with Cron as chief executive, Clarke noted their quick rapport and said he'd be "comfortable" with it. "He's a strong executive. Ken's business acumen is very sharp."

While pressing for greater transparency and pushing decision making down the chain of command, Cron runs "a very supportive management culture," Barrenechea said. "I've been here a year, and I hope to be here very many years."

Cron himself is taking it as it comes.

"I'm certainly here as long as the company needs me," Cron said. "The board and I agreed I'll serve until a permanent CEO is found. I think CA is a fantastic company.

"What if the board asked me to serve? We'll cross that bridge when we come to it."

Copyright © 2004, Newsday, Inc.

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