omputer
Associates International is expected to announce today that its new
chief executive will be John Swainson, an
I.B.M. executive with strong technical and sales credentials but who
is untested in leading a business the size of Computer Associates, which
has 15,000 employees.
Mr. Swainson, 50, left I.B.M. about a week ago to prepare to take the
top job at Computer Associates, the troubled software company, said a
person with knowledge of Mr. Swainson's plans. Neither Computer
Associates nor I.B.M., a rival, would comment last evening on the
expected appointment of Mr. Swainson.
Mr. Swainson assumes control over a company that is emerging from an
accounting scandal, barely sidestepped criminal indictment and whose
long-time leaders have been forced out.
Now Mr. Swainson, according to industry analysts, must repair
relations with customers and find new sources of growth for a company
that primarily sells software that corporations use on old-line
mainframe computers.
"The long-term challenge for Computer Associates will be to make the
strategic shift so it can grow beyond the mainframe world," said Kevin
Buttigieg, an analyst at A. G. Edwards.
Still, Mr. Swainson should have the opportunity to plan a long-term
future for Computer Associates, which is based in Islandia, N.Y. The
company settled federal charges of accounting fraud in September for
misreporting $2.2 billion in revenues. Unlike other companies tainted by
accounting scandals in recent years, such as
Enron and
WorldCom, Computer Associates is not facing bankruptcy. In the
fiscal year ending next March, the company will report profits of
roughly $500 million on sales of $3.5 billion, Mr. Buttigieg estimated.
Mr. Swainson brings to Computer Associates a reputation as a
respected technologist, one who is adept at winning over customers. Mr.
Swainson, who is Canadian, joined I.B.M. as a systems engineer in
Toronto in 1978. Over the years, he rose to become the head of the
company's research laboratory in Canada and later oversaw the
development of software products.
In the late 1990's, Mr. Swainson was placed in charge of shifting
I.B.M.'s strategic focus in software away from operating systems, where
it trailed
Microsoft and
Sun Microsystems, and to a layer of "middleware," which rides above
the operating system and relies on Internet technology standards.
I.B.M.'s middleware offering, called WebSphere, competes directly with
Microsoft's Internet-era software known as .Net.
Among software specialists, in press interviews and on Wall Street,
Mr. Swainson has been a forceful and articulate advocate for the I.B.M.
strategy, which has delivered solid growth and market share gains for
the company's WebSphere products.
"In Computer Associates, nobody is going to snow him technically,"
said Frank Dzubeck, president of Communications Network Architects, a
technology analysis firm in Washington. "Swainson is also very good with
customers, and he will have to shore up relations with customers. There
is a lot of dissatisfaction among corporate customers with Computer
Associates."
Though his background is as a technologist, Mr. Swainson took
naturally to courting customers, former colleagues say. A wine expert,
he particularly enjoyed hosting wine tastings for customers, they
recalled.
Yet Mr. Swainson must also prove himself as a chief executive. "You
couldn't pick anyone more knowledgeable about software and software
development," said John Patrick, a former I.B.M. executive who is
president of Attitude L.L.C., a consulting firm. "The challenge will be
on the business side."
Computer Associates, founded in 1976, was built on a steady stream of
acquisitions engineered by its founder and long-time chief executive,
Charles Wang. He passed the reins to his handpicked successor, Sanjay
Kumar, in 2000. Mr. Kumar was forced out earlier this year amid the
federal investigation into the company's accounting misdeeds. Mr. Kumar
was indicted by a federal grand jury in September on charges of
securities fraud and obstruction of justice.
A director, Kenneth D. Cron, took over temporarily as chief executive
last spring. Mr. Swainson is expected to be named interim chief
executive and president and to assume those titles permanently after a
period of months working closely with Mr. Cron.