Re: Yet Another Arnold Article

Larry Drews wrote:

> "IanH" <none@xxxxxxxxxx> wrote in
> news:431581e9@xxxxxxxxxxxxxxxxxxxxxx:
>
> > Wayne Niddery [TeamB] wrote:
> >
> >>
> >> In the normal case I would agree. However there have recently been
> >> public statements by Coates stating his view that the tools should
> be >> divested, and of course a lot of speculation by others (blogs
> and >> other articles) discussing this very thing. *In that context*
> I think >> his statement was reasonable (not to say it couldn't have
> been >> better, but still reasonable).
> >
> > I note that he does not mention the merits or otherwise of spinning
> > off the tools - merely pointing out that the Coates plan lacks
> > specificity, as "there is nothing that Coates has said that we have
> > not thought of ourselves".
> >
> >
> > This is clearly a live option for the company - which would not be
> > the case if the development tools were viewed as of strategic
> > importance.
>
> From you posts I would conclude that you do not have direct
> experience in managing a public company. A public company is always
> for sale, in fact, it has already been sold (that is what
> shareholders are, the buyers of the company). If a company can sell
> part of itself for more money than the intrinsic value of that part,
> considering both short term and long term aspects) then the
> management of the company has a fiduciary responsibility to the
> shareholders to do so in order to maximize shareholder value.

Well, gee, who'd a thunk it? Successfully managing my own company
educated me about the importance of maximising shareholder value, I can
assure you :-)

> Consequently, any public company must take the official position of
> being willing to consider any offer at any time. And if the
> management is doing its job properly, it is considering all of its
> options all the time, from expansion to going out of business.

And so.....

> Borland's management's job is to maximize shareholder value.
> Producing excellent software development tools is just the way that
> Borland has chosen to do that up till now. Presumably they will
> continue to do so as long as that activity maximizes shareholder
> value.

What you have written is so obvious as to be beyond dispute.

What is in question is the strategies that they should adopt to
actually achieve this maximisation of shareholder value, and - of more
importance to me as a long-term Delphi user - what impact this has on
the future of my key development tool. I'm not a Borland user, after
all; I'm a Delphi user.


> The minute that producing software development tools ceases
> to maximize shareholder value, they are required to do something else
> that is better.

And the indications from the CEO are that development tools are OUT,
and SDO is IN. Given an opportunity to reaffirm the strategic
importance of dev tools, he chose instead to go fishing.

I had a discussion here with Danny when SDO was unveiled, where I was
concerned about the relevance of Delphi to the broader SDO concept, and
whether Borland were still interested in the smaller shops. He informed
me that Delphi / the development tools were seen as a key technology
that SDO would be built around: that the developer was still the focus
of the technology. If this is indeed the case then future development
of Delphi would be guaranteed.

However, the conference call + subsequent public pronouncements are
indicating to me that SDO is only reliant on the existing dev tool
business for development funds - which puts the future of Delphi into a
different light for me. YMMV.

Follow your own logic, Larry: Borland are convinced that the growth
area for the future is SDO. They see Delphi as a mature tool
(regardless of whether Scott actually used the dread phrase 'cash
cow'). They have a fiduciary responsibility to act on these beliefs.

Please note that I am not saying that the SDO focus is wrong. If
chasing a small number of multi-million dollar SDO sales makes more
money for Borland then they HAVE to do it. It just means that where my
interests and Borland's have been aligned for so many years, they may
now be starting to diverge - and MY responsibility is to MY business.


Ian
.

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  • Re: Yet Another Arnold Article
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