09/10 New president of Novell Inc. come to Kansas City with promises
to make company more responsive to customers
Publication Date: Wednesday September 10, 1997
The Kansas City Star
(Copyright 1997)
By DAVID HAYES
KANSAS CITY - Computerese 101. Here's today's quiz...
Name a company that affects just about anyone who works at a business that
relies on computers, or anyone who does business with such a firm. There are
tens of millions of users.
Microsoft, right? Well, that too. But not this time.
The new chairman of the board and chief executive officer of Novell Inc.,
a company that once dominated the corporate computer market but more recently
has been known as a money loser out of step with the times, came to Kansas
City on Tuesday to tell local business and government technology executives
that Novell isn't dead yet.
Eric Schmidt, 41, was hired in April to lead Novell and take what he
describes as a "mismanaged" company and make it accountable to its customers.
He said the worst is behind the world's fifth-largest software company.
In the 1980s, Novell developed "client-server architecture," a somewhat
complex term for the system that allows computers to access and share files
from a central computer or connect with a central printer. It's a system that
most office workers use daily and take for granted, but rarely see.
Novell, based in Provo, Utah, now has more than 55 million users worldwide
and boasts that it adds a new user "every second of every business day."
However, the company's profits have been flat for some time, partly
because of increased competition from No. 1 software maker Microsoft, which
is marketing its own networking software.
And other changes are occurring in the way businesses use their computers,
sparked by the growing popularity of the Internet and the easy access
Americans, in particular, have to computers.
"Client server has been good to us," Schmidt said. "There are many, many
hundreds of thousands of people employed in the client server business. The
only problem is, that business is going away."
Instead, Schmidt said, the business is becoming a "client service
business."
Companies now must work to find ways to make it easier for their
customers, clients and partners to get information and do business - anytime
they need it.
"From a business standpoint, you need a network that speaks not just to
your own company, but to your customers and your partners," Schmidt said.
At a luncheon speech, Schmidt told the crowd of mostly large Novell
customers in the area that the future of their businesses will be changed by
the Internet.
About 80 percent of Fortune 1000 companies have sites on the World Wide
Web, Schmidt said. "The next generation of the story is using the Net for
commerce. It will mature in the next few years as the basis for legitimate
commerce."
And that will have an effect on everything from how consumers shop to how
businesses order supplies.
"A survey released last Friday showed that the number of on-line homes in
America doubled in the last year, from 9 percent to 19 percent," Schmidt
said. "This is a remarkable thing. Sixty percent of U.S. kids have access to
the Internet in some form. That's a very strong statement of where we are
going to go in the future."
The result could be big money, he said.
"If only 1 percent of the $7 trillion spent every year is shifted by this
change, think of the change this would make in your business," Schmidt said.
But converting the Internet from a place where users go to exchange e-mail
and be entertained to an environment where businesses make money is going to
take security, Schmidt said.
He took a potshot at U.S. government attempts to block the export of
encryption technology overseas, and FBI Director Louis Freeh's recent
statement calling for encryption technology to be controlled in the United
States as well.
"That's even more misguided, if it's possible to be more misguided,"
Schmidt said.
Schmidt said Novell is working on technology to make it easier for
consumers to shop on line, working with new software that will search out
prices on the Internet and deliver it back to the consumer.
"Will the sellers of goods shut the door because they're threatened by
this new way of buying, and if so how will the market respond?" Schmidt
asked. "I can't tell you, but we are experimenting with it."
Novell is rebuilding its franchise of running corporate networks with a
series of software releases, including a new version of its core product,
NetWare, Schmidt said.
On Tuesday he was making a special sales pitch for BorderManager, a
separate package that provides a secure link between a corporate network and
the Internet - while at the same time reducing some telecommunications costs.
The software was released earlier this summer.
The company's growth also will be fueled by Novell Directory Services,
software unique to the company that allows a computer user to access all of
the information and files he or she needs at any computer on a network
without special programming, Schmidt said.
"A directory is a place in the network where you can keep information
about you," Schmidt said. "It's a huge improvement for the average person.
And Novell has a two- to three-year lead on directories over any other
company."
Schmidt, a computer scientist who worked for 14 years for Sun Microsystems
before taking the job at Novell, said in an interview that he was surprised
by the mismanagement and lack of follow-up he found at Novell when he started
five months ago.
"We have talked to so many companies where we have made commitments and
not delivered on them," Schmidt said. "So we're taking a very pragmatic
approach. Let's ship the products to our customers we've already promised
them."
Novell has made a series of internal moves to improve its business
practices, including laying off 1,000 executive and workforce employees.
The company also recently cut a deal with Netscape Communications Corp.,
the leading developer of software used to access the World Wide Web, to form
a new venture to adapt Netscape's software to run on Novell's operating
system.
(END)
03:12 EDT September 10, 1997 |
