Chapter Beginning.
The New Man.
Job One:.
The Entrepreneur.
The changing of the guard.
In pursuit of the PC-compatible marketplace.
On a cold January morning in 1983, Ray drove his car under the I-15 overpass and into the glistening parking lot of the old truck dealership that was now world headquarters of Novell Data Systems Inc. To the east, the rising sun peeped over the snowy top of Mount Timpanogus; to the west, Utah Lake, a vast sheet of ice and chill water, was capped by a light mist. Next to the lake the Geneva Steel plant was unnaturally still. It had been shut down for several months now, and the Utah valley community was hurting. A government report in 1982 had declared Utah valley to be one of the ten most depressed areas in the country.
As Ray walked towards the warehouse, his steps crunching above the sound of freeway traffic, he remembered how he hated Utah winters.
The company Ray was interested in was depressingly spare in terms of staff and product. The $900 paintings from the Canova days still hung on the walls outside the "executive" offices--a grim joke. Only 14 employees remained of the 120 that had worked for NDSI a year earlier. A few of the 14 had stayed because they believed in the potential of ShareNet (Netware's first name), but most were there simply because they had nowhere else to go.
Three of the old management team remained: Joe Maroney, vice president of production; Rusty Woodbury, vice president of development; and Reid Clark, director of international sales. Superset--Drew Major, Dale Neibauer, Kyle Powell, and Mark Hurst--continued development of ShareNet. Dave Baumgartner handled domestic sales. Harry Armstrong worked for Joe Maroney in the manufacturing area as production manager. Craig Burton's job was basically to explain the virtues of LANing; he also wrote documentation, helped demonstrate the system to prospects; and "evangelized" ShareNet to software developers. Judy Clark fit in wherever she could as a secretary, receptionist, warehouse helper, tradeshow assistant--whatever. Diane Solberg was a secretary, and Lorraine Fitch helped with the bookkeeping.
Ray sat everyone down and introduced himself as a would-be president. For the next couple of months, he would be like a consultant to the company, observing and talking with the staff. He reassured them that he was not going to fire everyone and bring in his own people. He was going to see what he had to work with and what they could do. In the next few days he would interview each person to find out what they were doing and what they needed to do their jobs better.
The staff was somewhat skeptical--in the last nine months they had seen five presidents come and go. Ray was merely the latest; and he was another guy with a minicomputer background. On the other hand, they were encouraged by his personal investment in the company and by his reputation as a turn-around artist, a savior of failing businesses. Jack Davis called him "a company doctor." They weren't sure how to read the reincorporation from Novell Data Systems Inc. into Novell Inc.--maybe it was positive that NDSI was dead and that a new company had been born, or maybe it was a ploy to deprive them of their shares of NDSI.
There was something reassuring in the style of their new leader, though. He projected a kind of calm confidence, and as a fellow Mormon, he was more believable than his predecessors. Of the six Novell presidents, only Ray was a member of the LDS Church.
For the first two months--January and February 1983--Ray studied his new company carefully; he questioned and listened to his staff and watched them work. He spent a lot of time with Superset and a lot of time with Craig Burton.
In the beginning, Ray commuted to Novell from the Bay area, until he bought a house in Orem and moved his family in March. Jack Messman was still officially president until Ray was elected president and chief executive officer in March. On February 21, 1983, one of Messman's last acts as president was to change the name of the new company from Novell Data Systems, Inc. to Novell, Inc.
Ray's most pressing problem was to reverse the plummeting sales of Novell products, and he immediately hit the road making calls on prospective customers. Drew Major, Kyle Powell, and Dale Neibauer would accompany him on many of these calls, as would Craig Burton. Soon the staff realized that Ray was quite unlike the presidents who had preceded him. Ray was not just a manager; he was a worker. Neibauer recalled his early experiences working with his new boss:
The thing that I saw with Ray that was different right from the start was that he was competent. I don't know any other way to describe it.
Back in those days, Drew, Kyle, and I quite often would travel on sales calls and meet for discussion with nearly every person who considered being a customer of Novell. We almost always got involved in talking about what do we have, what direction we're going, what do you want, how fast do you need it. You know: "We'll have it by tomorrow night."
And when we started going out with Ray, people responded to him a lot differently. He took us into businesses that already knew him, people that had had dealings with him before. And he had an incredible credibility rating. People bought Novell because Ray Noorda was running it. They would buy off on this crazy, unheard-of notion because Ray Noorda was backing it.
I saw that when we went places, he ended up doing a lot of the sales early on. . . . I remember following him around and just watching and noticing that he did not use a lot of hype. He didn't promise things he couldn't deliver. And he had a lot of credibility. People tended to believe him when he said things.
Ray's willingness to work in the trenches set him apart from his predecessors. Where the previous presidents spent their time "managing," Ray rolled up his sleeves and jumped into every aspect of the business, from sales to shipping. Where other presidents had commuted to Orem, Ray put down roots there. Where a Shipley, for example, arrived to work in a limo, Ray drove an old pick-up truck. And no previous president had the depth of experience, the contacts, or the reputation in the computer industry that Ray Noorda had.
The product Ray and his team were selling was the networking system that NDSI had demonstrated at Comdex 82 in Las Vegas. It consisted of a file server with cabling and connections in a star topology that could accommodate up to 24 PCs. The system sold in 1983, called NetWare/S-Net (for Star-Net) did not allow the PCs on the network to talk with each other. It only allowed the PCs to share peripheral devices such as hard disk storage, printers, and modems. There were two key selling points: 1) low-cost sharing of hard disk storage space and peripheral devices like printers; and 2) the ability to put both CP/M-based microcomputers and DOS-based IBM PCs on the same network.
The end users for these systems were typically small or medium-sized businesses that had several stand-alone PCs. By buying a Novell network for a price ranging from $2,000 to $25,000, a company could buy just one printer or storage device that all the PCs could use, instead of individual peripheral devices for each PC. In 1983 Diablo Daisywheel printers where common quality printers and the new 630's sold for $2400 each. Older models sold for $3600. The HP laser printer was just announced and it sold for $3600. If a company needed some CP/M-based microcomputers as well as the new IBM PCs, it could still have them share the same peripheral devices by putting them on a Novell LAN.
Chapter Beginning.
The New Man.
Job One:.
The Entrepreneur.
The changing of the guard.
In pursuit of the PC-compatible marketplace.