CA Picks IBM Vet Swainson For CEO

Swainson, a 26-year IBMer, most recently led the worldwide sales organization for the company's software group. He assumed that post in July when a plethora of IBM executives, most of them from inside the software group, changed roles. Swainson, who is 50, previously served as general manager of IBM's Application Integration and Middleware Group, which shepherds the successful WebSphere brand of products.

Neither IBM nor CA officials would comment today on Swainson's appointment to the Islandia, N.Y., company's top post. Yet speculation had run high in recent months that CA would look outside its walls -- for the first time in corporate history -- to find an executive to replace Cron. Cron has held the interim CEO job since April following the well-publicized departure of then-chairman and CEO Sanjay Kumar, who resigned in the midst of a multibillion-dollar accounting scandal at CA. In September, Kumar was indicted on securities fraud conspiracy and obstruction of justice for his alleged participation in a long-running scheme.

CA has been trying to clean up its image ever since, agreeing to pay $225 million to compensate CA shareholders for losses caused by the improper practices and firing executives with connections to the scandal. Under Cron, CA also reorganized its management ranks and acquired several companies, including Netegrity, and cut 800 jobs out of a workforce of 15,000.

From a partner perspective, Kumar's departure had caused some concern because the executive was considered to be highly in tune and supportive of the channel. Yet the publicity surrounding his role in the accounting scheme hurt business, and most partners wanted to see the legal woes eliminated. For his part, Cron got high marks as a channel-friendly leader, though CA is still primarily a direct sales company.

Partners today welcomed Swainson to the job, calling it a much-needed new start, one made more comfortable because the new CEO comes from channel-focused IBM.

"By bringing in someone new with a new perspective, you can get the ship steered in a direction that will be good for business, good for customers and ultimately good for partners," says Todd S. Pekats, director of strategic alliances at CompuCom Systems and a member of CA's partner advisory board.

Pekats says he would like to see Swainson build on Cron's channel strategy at CA so that partners see more forward momentum heading into the future. Shortly after taking over in April, Cron articulated a beefed up channel approach, with a goal of making CA's software easier for VARs to seamlessly integrate into the vertical-market installations they sell to their customers and upping the percentage of revenue that goes through the channel. Currently, only 10 percent is indirect.

Swainson could be the key to taking things to the next level. "I think [CA's] channel strategy has been a good strategy, but they've had challenges in execution," Pekats says. "I think that someone who understands the channel well can help execute on some of those strategies and will be able to facilitate some real good movement forward."

Separately, CA has decided to scrap its annual customer conference in 2005 and beginning planning for 2006. In an e-mail to CA World attendees on Monday, Joan Blackwood, senior vice president of marketing for CA, said the company wants additional time "to transform CA World into a true industry thought leader ... [and] better showcase our many strong partner relationships."

-- Jeffrey Schwartz and Alexander Wolfe contributed to this story.