Should New Borland CEO Be Afraid?

Application lifecycle management vendor Borland Software announced it has appointed Tod Nielsen to the position of president and CEO, replacing interim CEO Scott Arnold.

But what of the company’s recent financial difficulties? Speaking to me late last week on the day the news was announced, Nielsen said he is only too aware of Borland’s challenges: “Challenges don’t scare me,” he said, “If it was easy, everybody would be doing it.”

Nielsen said that while it is too early to talk in any great detail about his vision for Borland’s future, it is, “Unlikely that the company will suddenly make a left or right turn – we will certainly be refining the message and clarifying the vision, but it’s not going to change drastically.”

“It will still be about Software Delivery Optimisation,” Nielsen continued, “and how Borland can help companies get more value from their software development projects.”

Nielsen’s most recent role was as senior vice president of marketing and global sales support for Oracle. Before that he was chief marketing officer and executive VP of engineering for BEA Systems, after the company bought his private firm Crossgain, where he had been CEO.

Former Borland chief Scott Arnold took the reins on an interim basis after the CEO before him, Dale Fuller, stepped down on the announcement in July of a profit warning and missed expectations.

Though Arnold had not had long to start implementing his own vision for Borland’s direction, its latest quarter’s results were said to show the company is already on a more stable footing – though on a GAAP basis the net loss widened and revenues were also down, the company at least generated $2.5m in cash from operations.

Asked whether Nielsen believes that he will need to trim expenses further in order to lift profits, he said that it is too early to know what needs to be done financially: “I’ve only been in the post four hours,” he laughed.

Nielsen also said he has not yet taken any decisions on whether or not dissident Borland shareholder Robert Coates may have had a point when he suggested that Borland should sell some of its ‘legacy’ IDE and middleware products – a plan that Borland’s board rejected in September. “I don’t have an opinion on that yet,” Nielsen said.

Not surprisingly given the circumstances, Scott Arnold – who prior to joining Borland was at McKinsey & Company for over 15 years – will be leaving Borland, “After an appropriate transition period has been worked out.” William K. Hooper, chairman of Borland’s board, thanked Arnold for his efforts as interim CEO, saying the board appreciated his, “capable leadership during the transition period”.

Nielsen, who also spent twelve years with Microsoft in various roles, was the sixth BEA senior manager to leave that company within a month when he resigned back in August 2004 – BEA was in the midst of a management restructuring that also saw the departures of SVP advanced development Adam Bosworth, also from Crossgain, and CTO Scott Dietzen. Yesterday Nielsen said the reason for his departure at that time was a “difference of opinion” over the right direction for BEA.

In a statement last Friday Borland’s Hooper said: “The board of directors was impressed with Mr. Nielsen’s deep experience in our target markets, his proven leadership in market leading software companies, and the passion he brings as an individual to the need for better software development. We are confident that Borland, behind Mr. Nielsen’s leadership, will push forward in its pursuit of Software Delivery Optimisation, and continue to drive customer success.”

Borland is still to announce a new chief technology officer – its former CTO Patrick Kerpan left the company to pursue other interests in October. Nielsen said it has been hard to recruit a CTO when it was not clear to potential candidates whether Scott Arnold was to remain CEO or whether a new CEO would be joining – now that that uncertainty is gone he hopes to speed up the hunt for a new CTO.

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