Surfing the High Tech Wave
Chapter Beginning.
Summary.
The March Massacre of 82.
After the massacre.
Judith Clarke on Comdex 82.
The story the booth tells.
Novell's booth at Comdex has chronicled the company's fortunes. In 1980
Jack and George were in a booth without product. In 1981 the booth had
product, but it was the wrong product for the time. Now finally in 1982,
the booth was filled with the right product for the time, but Jack and
George were gone.
The differences between Comdex 81 and Comdex 82 were ironic.
In 81 Novell had money but no LAN product. In 82 they had a LAN product
but no money.
In 81 they had a big booth filled with lots of high powered, high priced
talent. In 82 the booth was a simple wall of screens showing a Novell network
in action and the high talent left after the year of crisis was strictly
high tech.
And, most of all, Novell needed a president.
The Comdex show went smoothly. The LAN worked and booth visitors were impressed. The big news of the day was that Sandy Shipley took this as the moment to "can" Dave Guerraro. Remembered, but unnoticed at the time, was an older visitor to the booth who introduced himself as Ray Noorda.
After the show, Shipley left and Jack Messman was back again. Behind him was the New Jersey man who was still interested in Novell and still offering his low price. A letter was sent to the remaining employees stating that it was likely the company would move to New Jersey and asking who was interested in relocating? Novell was about to become part of this other company.
Harry Armstrong remembers those days. "I got the letter and told Messman that my cowboy boots were stuck on too tight. I wasn't going back. I'd worked in Hauppage ten years earlier when I was in aerospace. I knew what I'd left behind, and I'd left for good reason."
In December of 1982, just before Ray took over, the first two production
LANs where shipped--one domestically and one overseas. Novell's LAN era
began just as it was to find it's permanent president.
For two years Novell Data Systems cut a spectacular swath through the lives
of a hundred Utahns. It helped define what a domestic electronics manufacturer
could do in the personal computer industry by showing many things that
didn't work:
It showed that quality was important, and that if top management wasn't sensitive to quality problems and wasn't proactive in solving them, then it could kill a company.
It confirmed to Ray Noorda that his vision was correct: that the constraints of the domestic manufacturing environment in the eighties would make producing commodity electronics hard to do. And that terminals, printers and personal computers were commodity products.
It didn't confirm George Canova and Jack Davis's vision that Utah's lower-than-US-average wages, high productivity and easy accessibility to electronics designing and developing talent from BYU could allow a Utah manufacturer to offset the East Asian lower wage advantages.
It showed that collecting together experienced, high talent managers with long experience in the minicomputer industry and adding lots of money was not enough to insure success in the personal computer industry. Some other mix of talent, experience and vision was going to be needed to make a success in this new, emerging industry.
It showed that tracking a "moving target" goal is expensive: the products that Novell produced in 1982 changed continuously. But the changes were too often reactive rather than proactive, and they generated more costs than sales. There wasn't enough coordination between departments to accommodate the pace of change.
It showed that when partners come together to pursue a common vision, they need to make sure they understand where their vision is common and where it is different. The blinding brightness of what is common can hide some deep shadows of difference. If those differences fester, the product and the company can suffer.
Novell also confirmed one other thing: just how hard it is to kill an electronics company. This was a company that had never produced a profit, had spent millions of dollars, in it's final months had more returns than sales... and yet it didn't die. There was still a dream and still people willing to invest in it.
In coming upon rocky times after existing for two years, Novell was in plentiful company. There had been a lot of startups in Utah that had sounded just as good and ended up just as broke. For Utah, Novell was not yet a surprising company. It was doing about average.
Novell Data Systems was a proving ground for Novell Inc. It taught the Novell Inc. founders how many things could go wrong. It showed them how to squeeze lemonade out of lemons, and how important a good vision about the company and the product is.
Perhaps the greatest chain of irony is that: a) The LAN would have never developed at Novell if Novell hadn't first had problems with it's personal computer product. b) It wouldn't have had problems with the personal computer product if it hadn't been forced by it's financing to have a personal computer in the first place.
In retrospect Novell's evolution into making the LAN product is logical, but if you'd talked to Jack Davis in the summer of 1980 about Novell making it's fortune with a PC-based LAN product, you'd have gotten some strange looks, indeed. And, most important of all, the LAN wouldn't have happened if there hadn't been a lot of heroes to help it along the way.
It is sometimes forgotten in the Novell story that the LAN vision at Novell emerged early, it rose from the ashes of the minicomputer product in the spring of 1982. All during it's gestation it was supported by the whole company and the company's owners as important. But all through 1982 it was recognized as a product for Novell's future. What NDS could never find in 1982 was a product for its present.
For Novell, 1982 is the story of a stage being built and heroes being forged. Novell in 1983 will tell the story of those heroes in action.
Chapter Beginning.
Summary.
The March Massacre of 82.
After the massacre.
Judith Clarke on Comdex 82.
The story the booth tells.