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From the archive: 'I had this crazy idea'

How Wang built a software giant

Charles Wang, CEO of Computer Associates, in front

Charles Wang, CEO of Computer Associates, in front of their headquarters in Islandia. Jun 09, 1997 Photo Credit: Newsday/J Michael Dombrowski

This story originally appeared in Newsday on Nov. 19, 2002, without a photo.

When Charles Wang was about to graduate from Queens College, the school didn't have a computer sciences department and he wasn't even sure exactly what a computer did.

But Wang saw in the help-wanted section of a newspaper that there were 2 1/2 pages of classified ads seeking computer programmers.

The pragmatic native of Shanghai, China, who had a knack for math and physics, decided computer programmer was the job that was in greatest demand and that's what he would become.

The decision was the start of a brilliant but turbulent and often controversial career during which he co-founded what is now the nation's second-biggest independent software maker, Computer Associates International, and fended off fierce attacks on many of the company's practices and tactics. 

It was a roller-coaster ride, Wang, 58, acknowledged yesterday, as the company announced his retirement as chairman.

"It was a little over 25 years ago when I had this crazy idea to get into this new business called 'computer software,' " Wang (pronounced Wong) said yesterday in an e-mail message to employees. "Along the way, we had many successes, some failures, many happy moments and, of course, some sad ones too."

Wang, known as an undiplomatic and combative competitor in the computer world although personally philanthropic and charitable, leaves as part of his legacy a remarkable string of acquisitions, many of them accompanied by big layoffs.

That created a company fifth in the world among all software makers and second only to Microsoft among software makers that are not tied to a single computer hardware manufacturer.

But that record was repeatedly overshadowed by some of the other actions taken by the company, whose software is used by companies to run mainframe computers and manage networks. As a result, it became better known for accusations against it of excessive executive pay, prickly customer relations, questionable accounting and weak corporate governance. The accounting is still under investigation by the Justice Department and the Securities and Exchange Commission.

"Given the controversy engendered toward the end of his regime, his departure will be viewed as a positive" by the financial community, said Charles Elson, director of the University of Delaware's corporate governance center.

In 1998, Computer Associates granted Wang, co-founder Russell Artzt and president Sanjay Kumar $1.1 billion in stock, of which they agreed to return more than $200 million after lawsuits challenged the award.

Last year, Texas tycoon Sam Wyly led an unsuccessful effort to replace management and several board members over the award and other governance issues, an effort he repeated this year on a smaller scale, only to be bought out by the company for $10 million in a move criticized by investors.

But in the past few months, the company has moved to calm investors through changes in its business practices and its board of directors.

"I learn from my mistakes," Wang once was quoted as saying. "I'm not stupid."

Wang arrived in this country in 1952 when his family fled China after the Communist revolution. They settled in Queens, their former ornate home in the French Quarter of Shanghai replaced by a walk-up in Queens Village.

Wang's father, Kenneth, went to night school so he could practice law again and became a St. John's Law School professor, while his mother, Mary, took a library clerk job and later became branch manager.

After graduating from Queens College, Wang became a programmer trainee at a Columbia University research lab, where Artzt became his friend.

In 1976, they formed Computer Associates, which began marketing software in the United States for a Swiss company of the same name that was given a 50-percent stake in the new CA.

The company went public in 1981, raising $12 million and launching a stock that was used for many acquisitions through the years.

Wang and Kumar accumulated enough wealth by 2000 that they were able to buy the New York Islanders hockey team. As of the latest proxy, Wang personally and through stock held by his wife and in trust for his children, as well as those in a charitable foundation, owned 28.44 million shares in CA, currently worth $437 million. His wife, Nancy Li, is head of a CA subsidiary.

Wang, who has a mansion in Cove Neck, and Kumar also bought up dozens of properties in Oyster Bay, saying they want to revitalize the downtown area but raising concerns among residents who wonder about their plans.

In a statement yesterday, Wang, who will have the honorary title chairman emeritus, said the company's offerings are "strong and competitive," its business model has gained broad acceptance and its performance has shown signs of strength. Wang said he will spend more time now, both on retirement and on his charitable activities.

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