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From the archive: The house that Wang built

Or, how to succeed in business by really, really trying

Charles Wang, chairman of Computer Associates, addresses the

Charles Wang, chairman of Computer Associates, addresses the Long Island Association about e-commerce on Nov. 17, 2000. Photo Credit: Newsday / Dick Kraus

This story originally appeared in Newsday's Part II section on Aug. 15, 1995. The photo seen here was added to this republished version.

A three-dimensional globe rotates slowly on a computer screen, then contracts and flattens into an outline of the United States. The skyline of a city looms up from the virtual landscape, as if seen from an incoming airplane.

"Well, look at that," George H.W. Bush says.

The 41st president of the United States is peering at the screen while standing next to Charles Wang, the chief executive officer of Computer Associates International. They're in an exhibition hall in New Orleans packed with 15,000 of the Long Island-based company's customers, business partners and employees. Bush reaches for the mouse directing the demonstration of Computer Associates' next product, which will help technicians pinpoint problems in vast computer networks. 

"Don't touch it," Wang says, proprietarily. Bush pulls his hand back, and the two laugh awkwardly. On the screen, an unseen intelligence continues to take viewers on a 3D ride into an individual city, into a single skyscraper within that city, and finally into the guts of a single, glitch-ridden computer.

Bush gives his head a golly-gee shake and turns to find Wang, in a jaunty, double-breasted suit, already cutting a swath through the crowd of gawking onlookers. As the pedigreed former president follows on the heels of his employer for the day, there's no mistaking the message of this choreographed joint appearance:

It's Wang's world now, on the computer screen and off.

It's a world in which a former supermarket stock boy with an undiluted "New Yawk" accent has the clout to hire a Yale-educated former president to entertain his customers, as Wang did for Computer Associates' annual customer conference in mid-July. (Bush's standard corporate fee for a speech and a walk-around is about $80,000.)

It's a world in which an immigrant who once could not afford the 32-cent lunch at Brooklyn Tech High School now commands the second-largest independent software company on the planet, and who was paid $8.6 million in salary and stock awards last year. He's amassed more than $500 million in CA stock. He blows off steam by playing basketball on an indoor court at his 60-acre estate on Nassau County's North Shore.

It's a world in which Charles Wang, at 50, is widely recognized as one of the lions of the tooth-and-claw software jungle, his growing mystique drawing attention from national magazines such as Newsweek as well as from passers-by on the streets of New York City's Chinese neighborhoods. People in the software industry have come to see him in the same light as Microsoft's legendary Bill Gates.

"Wang has some magic of some kind, and nobody knows what it is," says Paul Mason, an expert on software companies for International Data Corp., a market research firm. Mason admits he has expected Computer Associates to run into serious trouble for several years. "After what he's managed to pull off, he's held in awe."

This year, Computer Associates racked up a 22 percent increase in revenues, to $2.6 billion. Its stock, selling at $31 a little more than a year ago, soared into the low $70s. Wang pulled off the second-largest takeover in software history, a $1.6-billion buyout of a rival, Legent Corp. of Herndon, Virginia.

While financial and industrial institutions in the New York area are downsizing, Wang is hiring and throwing parties to celebrate quarterly earnings at which employees feast on platters of shrimp and roasted meats.

With 1,500 employees at its Islandia headquarters, CA has become one of Long Island's biggest employers, and plans to add about 300 employees locally this year. Symbolically, at least, CA has become the most important company on the Island, representing the high-tech future that some envision as a replacement for the disappearing defense industry.

It is, as much as any company in the United States, the creation of a single individual, wholly shaped by his personality: aggressive, shrewd, and staffed by workaholics who follow Wang's lead or are sent packing.

Wang's favorite measure of success is "revenue per employee." That number is going up rapidly, too: from $303,000 a year ago to $363,000 in 1995.

"Our time has come," Wang says. He shrugs his shoulders as if he always expected the four-person company he launched in 1976 to become an international empire, which friends say he did expect. "When you're this successful, people have to recognize it," he says. Wang's grin finishes the sentence for him; even if people have to grit their teeth while doing it.

He may have won his industry's admiration, but not its affection. On his way up the ladder, Wang elbowed out dozens of competitors and laid off thousands of their employees. He's bought more than 50 other software companies, absorbing into CA only those who fit CA's needs and who are willing to pledge total loyalty. "People love to hate us," says Douglas Robinson, a CA senior vice president. Wang's personality, too, has rubbed many people raw. He can be brusque, impatient, even dismissive of anyone who questions him or his view of the world.

"He's not afraid to come on strong with customers he thinks aren't paying him enough, and he makes it clear that he thinks most people in the industry don't understand technology," says Mason. "Miss Congeniality he is not."

Charles Wang (he uses the Chinese pronunciation, which is Wong) has taken enormous satisfaction from proving people wrong ever since his father, a prominent Shanghai judge, fled with his family to the United States in 1952 after China's Communist revolution.

The list of those who've tried to dismiss Wang is long and varied: The neighbors in Queens Village who took up a petition to keep the Wangs from buying a house on their block. The legion of software competitors who scoffed at his tiny company's grand ambitions, until Wang showed up at their doors with enough cash to buy them out. The Wall Street analysts and trade-press pundits who've been waiting for 15 years for Wang's hard-edged and cocky company, which at times has irritated its customers as much as its competitors, to fall flat on its face.

Computer Associates has stumbled along the way, but come back bigger each time. Of independent software makers, only Microsoft is bigger. (IBM sells more software than either firm, but the majority of its sales are in hardware — that is, computers.)

"I learn from my mistakes," Wang says. "I'm not stupid."

CA has flourished by focusing on business software, a part of the market that's generally invisible to the PC-using public. The company's software performs a host of functions, ranging from systems management to providing computer security, but in simplest terms gives marching orders to large companies' cabinet-sized mainframe computers and networks of mid-range computers.

Aetna, for example, uses CA software to keep track of its customers' health-insurance claims. Using CA software, Citicorp and Chase Manhattan banks process millions of financial transactions. The U.S. Customs Service keeps track of the backgrounds of tens of thousands of people, and American Airlines plots flight plans for hundreds of flights daily.

While business software isn't sexy, it generates piles of money. By tradition, business software is licensed, not sold, with customers paying recurring fees that are linked to how much work the software does.

Instead of getting a one-time fee, as Microsoft will when it sells Windows 95, CA keeps charging customers for its software year after year, raising the fees if the customers expand their computer operations. The company's got more than 350 software products, and tens of thousands of customers. The largest ones pay CA fees of $100,000 and up a year.

Wang's success has even drawn the interest of Microsoft's Gates, who this year agreed to package part of his company's new Windows NT software, designed for businesses, with complementary CA software. It was the first time Microsoft has ever "bundled" another company's product with its own.

Brought together by common business and personal interests, such as the problems that come with immense wealth, the two cyberswashbucklers have drummed up a transcontinental dialogue by phone. By phone, because the iconoclastic Wang disdains email as too impersonal.

"Gates is like me," Wang says of the richest man in the country. "He and I can have the deepest technical conversations, and then talk about marketing. He gets into the details. He's not one of these CEOs who's flying at 40,000 feet saying: 'We have to foster the entrepreneurial spirit.' "

But is there truth, Wang is asked, to what another software CEO recently said of Gates: "You get Bill Gates in a room with his peers, and he will know more than anybody else in that room"?

"No," Wang says, his eyes betraying a glint of fire. "Not when I'm in the room."

Leaning forward, Wang says there is something he knows that William Henry Gates III — an upper-middle-class kid who dropped out of Harvard — will never know.

"I know what it is to go hungry. He doesn't."

To learn about hunger, Wang had to leave China at the age of 8 and come to the United States.

He had grown up in a prestigious and prosperous family in Shanghai, where his father, Kenneth, was a prominent judge and then, after the Communist revolution in 1949, president of the Aurora College for Women there. The Wangs' three-story home in the city's French Quarter had a winding staircase that Wang remembers fondly for the banister rides.

But after Mao Zedong came to power, Kenneth Wang saw colleagues and friends dragged off to jail or dispatched to farms in the countryside. "He knew they'd be coming for him," Wang says. Kenneth fled to the United States in 1952, and his wife, Mary, and three sons followed six months later.

The Wangs settled in Queens. They were free, but the fall was precipitous: Instead of their ornate home in the French Quarter, they had a walk-up in the Cunningham Heights Apartments in Queens Village. Wang's first look at American apartments, while he and his parents visited another building, astonished him. "We thought at first we'd get a whole floor; I didn't realize there were eight apartments on each floor."

The three boys, Anthony, Charles and Francis, could not speak a word of English. At school, they were the only Asians. At first, Wang says, teachers thought he was stupid because he could not respond appropriately to their questions, and they temporarily set him back a grade.

Kenneth Wang went to night school to regain the ability to practice law. Mary Wang took a job with the Queens library system. Though the Wangs climbed back up the ladder, with Kenneth Wang becoming a professor at St. John's Law School, for years there was little money and sometimes not enough to eat.

Today Wang doesn't talk a lot about the discrimination and deprivation he faced. When he does, he makes light of it. But his jokes — "rejection is good training for a salesman"— have an edge that betrays deep feeling.

"It had a tremendous influence," Wang says of his immigrant experience. "I wouldn't begin to psychoanalyze it."

"Charles had some ugly experiences," says Donald Axinn, a developer who rented Wang his first Long Island office in Jericho, and has known him for 15 years. "I think a lot of his motivation comes from being able to show he's every much as good as anyone else."

Wang began showing the world exactly what he could do in the first jobs he took while attending Brooklyn Tech and Queens College. Given the task of sorting mail at the U.S. Post Office, Wang rearranged the slots in front of him, so that those designated for areas receiving the most mail were easiest to reach. It made the work quicker, but "everyone got very upset — the union, management, everyone," Wang says.

While working at a supermarket, Wang made a point of memorizing the price of every item as he stocked the shelves in the morning. Later, when he was working the checkout counter, Wang rapidly punched prices into the cash register without pausing to pick the items up as they slid by. "Some of the ladies loved me. 'The Chinese kid is fast!' But some of 'em wanted nothing to do with me, because they thought I was cheating them."

At Queens College, where he majored in physics and math, Wang was only an average student. He was bored by his schoolwork and unimpressed by his teachers. He graduated in 1967 with only a 2.2 grade average. "I just wanted to get the sheepskin and go to work," Wang says. "Being taught by a civil service worker who's never been in the world, what's the point?"

Without ever having touched a computer, Wang had decided to become a computer programmer. It was, characteristically, a thoroughly practical decision: Studying the "Help Wanted" classifieds, Wang found 2 1/2 pages of ads for programmers.

He learned to write the coded instructions that make up computer software at a research laboratory at Columbia University. After four years of working there, Wang realized there was more money in selling software than in designing it.

In 1974, while selling business software for a company called Standard Data, Wang stumbled upon a program that sorted data on IBM mainframes more efficiently than IBM's own software. It was called PAN-SORT, and it was made by a Swiss firm, Computer Associates International, Inc. Wang got the rights to sell PAN-SORT in the United States, renamed it CA-SORT and within two years sold so much of it he was able to buy out the parent company.

Under Wang, the relaunched Computer Associates began with three employees and a single software product. "We learned on the fly, and we worked seven days a week," says Russ Artzt, a Queens College buddy who helped launch the company. He's now an executive vice president of development at CA.

As the company grew, its Madison Avenue office became a cramped maze. Wang's desk was a door mounted atop two boxes. At times, Wang, who was married and father of a daughter, had to borrow $400 on his credit card to make his payroll.

But amid the chaos, he knew exactly where he wanted to go. And he was developing a business strategy and an internal management style designed to get him there — one that has remained remarkably consistent even as the company moved to larger offices in Jericho, then to Garden City and, in 1991, to its own headquarters in Islandia.

From the beginning, Wang realized it would be cheaper to buy out other companies with good products than to develop software to compete with them. In effect, he let others labor over constructing elaborate software buildings, then bought them and started collecting the rent.

"He was always a very, very pragmatic person," Artzt says.

Unlike some competitors run by technical wizards, Wang put as much emphasis on selling his software as he did on developing or buying it, giving his most productive salespeople huge bonuses. In later years, says Michael Guido, one of the first salesmen at CA, top sellers earned $300,000 in just three months, and one salesman even out-earned Wang one year, pulling in about $900,000.

From the beginning, Wang worked like a demon and insisted that his employees did too, making it clear that employment at Computer Associates was not just a job but a mission.

Two years after Wang took over Computer Associates, Guido says, he pulled together his growing staff of about 60.

"Charles said, 'Look around you,' " Guido remembers. " 'This is the group of people who are going to create the world's largest software company over the next ten years.' "

It wasn't just a pep talk. Outside the company, Wang's grand ambitions had competitors sniggering.

"People laughed at him," says Bob Toth, a senior vice president at CA. "They thought he was a joke."

People are still laughing. But in 1995 they laugh only when Wang tosses off one-liners and sarcastic asides, which he does constantly.

When you're the chief executive officer of a $2.6-billion company, almost everyone laughs at your jokes.

"Can you believe how hot it is?" Wang asked the audience during his keynote speech at his customer conference in New Orleans last month, on a 95-degree day.

"How hot IS it?" a few hundred CA employees boomed back on cue, as if they were part of a "Tonight" show taping.

"It's so hot that Ingres World," Wang said, referring to a seminar on a CA product, "is now clothing optional." Encouraged by the chuckling, Wang launched into a string of "How is it" jokes, his image projected on both sides of him on 30-foot-high screens.

"The way he was introduced, it was like he was Michael Jackson," said a surprised Brad Semenko, a customer from Winnipeg, Ontario. "Software isn't supposed to be this glitzy."

But Wang likes being a star, almost as much as he likes confounding people's expectations.

He doesn't look, act or talk like the CEO of a giant software company, if you expect one to be either a tousled techno-geek like Gates or a button-down bottom-liner like IBM's Lou Gerstner.

Listening to Wang is like listening to a kid in a Queens schoolyard, where he, in fact, spent a fair amount of time playing stickball. There are no G's at the end of his "-ing" words, so that "computing," for example, comes out "computin'. " Speaking to a group of people, Wang addresses them as "you guys." He liberally salts his conversations with profanity. "At CA," goes one of his milder sayings, "we're long on technology and short on bullshit."

"He sure does sound like he's from New York," marveled Harold Levine of the WPM Computing Consulting Group of Texas, after hearing Wang speak in New Orleans. "He's, uh, very down-to-earth."

Wang's wardrobe isn't. He dresses like a reader of GQ, and not a reader of Datamation. He favors tailored, double-breasted suits and expensive, eye-catching silk ties, sometimes accenting them with a pocket square or glinting gold cuff links.

His clothes plainly tell you that the wearer has made it big, so big that the drab uniform of the establishment isn't for him. "You see this tie?" Wang said, while waiting for a taping of a recent cable-TV interview. "This tie cost more than this suit."

That kind of cocky competitiveness is evident in almost everything Wang does. Take his basketball game.

For years he's been playing hoops with a group of five high-ranking CA execs, a boys' club of his best and brightest. By all accounts, the games are bitterly contested, particularly by Wang, who prides himself on shutting down whomever he covers. "He hacks people pretty good," says Toth, one of the regulars.

Wang once shattered his own nose while trying to strip the ball from Mike Picker, now a senior vice president at CA. Wang told the nervous Picker not to worry. After healing, Wang returned to the court and broke Picker's glasses. Accidentally, of course.

In recent years, when the games shifted to Wang's indoor basketball court at home, he suddenly developed a long-range jump shot. Grinning, he confesses he spent long hours shooting with a weighted glove on his hand to develop wrist strength.

"He's the only guy I know," says Artzt, another regular player, "whose jump shot is better at age 50 than it was at age 40."

Wang allows no one to score on him off the court, either. Charming and charismatic when he wants to be, he can also be a prickly character, especially in dealing with those he sees as critical of him or his company.

Wall Street analysts and the media both irritate him profoundly. Accustomed to controlling everything within the confines of Computer Associates, Wang finds it galling that people he views as unqualified can say what they want about his company without his permission.

For years, he notes, analysts and the trade press have been predicting that CA would not be able to digest some of its acquisitions or sustain its rate of growth. "That's why I make acquisitions, and they don't," he snaps. "If you believe everything Wall Street or the media said, we'd be out of business."

When, five years ago, Computer World reported in several stories that CA customers were complaining of poor service and an arrogant attitude, Wang complained angrily to the publisher. Unsatisfied, he later withdrew advertising from the magazine.

He was even more incensed about a Newsday story in 1994 about his decision to become a board member of the Long Island Association, a business group, after years of being wooed by the organization. Quoting LIA insiders, the story speculated that Wang relented because "it never hurts your company to rub elbows with the movers and shakers of the business community."

Wang found this deeply insulting, particularly because it was former Newsday publisher Bob Johnson who had urged him to join the LIA board. Wang promptly quit. He won't consider going back.

"My mother was upset by that story," Wang says. "My mother. If my mother gets upset, I get angry." Besides, he says, he doesn't need to make speeches at LIA dinners to do his part for Long Island. "Our biggest contribution to Long Island is to be a strong company and to hire people," Wang says.

If Long Island wants Wang's advice on how to solve its economic problems, sorry: That's not his department. A software company does its business in cyberspace, not on Main Street. And Wang gave up on local government after Suffolk County officials ignored his suggestion that they give CA employees breaks on their real-estate taxes.

"I'm not the greatest admirer of politicians," he says. "They have to rule by consensus, so they're always waffling."

He is as fiercely protective of his family as he is of himself and his company. For this article he declined to provide access to his parents or two brothers, the older of whom, Anthony, served as his right-hand man at CA for 13 years.

"My private life is my private life," Wang said. "I guard that religiously."

He'll talk a little about his first marriage, which ended when he was building CA. Proudly, Wang says that he raised his daughter from that marriage himself. "She was three, four years old, and I was working eighteen hours. How did I do it? I used to go home promptly at 6:10, like clockwork, feed her dinner at 6:30, help her do her homework, put her to bed, and at 8:30 go back to work." She's 23 now and lives in Hawaii.

But in interviews and in dealings with the outside world, Wang deliberately avoids mentioning his current wife, Nancy Li. She's an executive vice president at CA, overseeing the division that develops new software. "I'd rather not talk about her," Wang says, waving his hand dismissively. "It's not a well-known fact that she is my wife."

Li, now 37, came to CA in 1981 as a developer and quickly rose through the ranks. Though their relationship was the subject of widespread rumors within the company, it was never acknowledged by Wang or Li until they married, former employees say. Today she's a key player in the company, a member of a small circle of people Wang trusts.

Wang and Li, who have a 2 1/2-year-old daughter, are basically homebodies. "I cook almost every night," Wang says. He serves up what he calls "home-style Chinese food," stews, chili and pasta. Wang doesn't make the charity circuit, preferring instead to let CA match every dollar his employees give to the causes of their choice.

"I don't do dinners," Wang says.

He's too hungry to waste time on dinners, too busy trying to build his company.

With his company about to leap over the $3-billion mark like another hurdle, Wang has broadened his goals. Not only is CA going to get bigger, he says, it's going to become kinder and gentler - at least to its customers.

For most of the 1980s, CA was considered a shark in the software tank by competitors and customers alike. It ate smaller companies, aggressively raised prices if customers changed their computer operations and sold new products behind a super-aggressive sales force. "The most hated company in the industry," CA was often called.

"We had some growing pains," is how Wang prefers to put it. To keep customers happy, he's turned some of his salesmen into service specialists charged with holding customers' hands. "Frankly, we learned that we can't be just suppliers to our customers. You need a relationship."

Analysts and customers give CA mixed reviews about the results but say the company is at least trying to improve service.

Wang is also determined to beat another rap — that CA was little more than a software warehouse, stocked with products taken from acquired companies' shelves. Last year CA-Unicenter, a major new systems-management product developed by CA programmers, virtually took over its part of the software spectrum and produced $400 million in revenues.

"When they came out with Unicenter, everybody assumed it couldn't be any good," says Mason of International Data. "Lo and behold, it blew everyone out of the water."

Unicenter, which helps the flow of information in the tangled web of mid-range computers on which many businesses now rely, is also helping CA move away from its reliance on mainframe products. So are the deals Wang has recently cut to mesh his Unicenter products seamlessly with PC network software from Microsoft and Sun Microsystems.

Longtime friends say Wang, like his company, is evolving. "He's mellowing a bit," says Artzt. Once devoted to 18-hour days, six or seven days a week, he's cut his work schedule so that he can spend evenings with his wife, daughter and his mother, who also lives on his estate. "Working all the time is not what makes you happy," Wang says.

He can afford to cut back now largely because he's got a second-in-command, Sanjay Kumar, 33, whom he has molded in his own image. Kumar, the chief operating officer, handles the company's day-to-day administration and is the lead negotiator on acquisitions. "He's doing a lot of the dirty work," Wang says. Like Wang, Kumar is a former programmer with superb business instincts.

"The kid is so bright it's scary," Wang says.

At 50, Wang is also obviously enjoying the attention he's getting now — the accolades in the software world, his chats with Gates, the "technology boot camps" he holds periodically to educate computer illiterate CEOs (and, of course, to continue to polish the image of Computer Associates).

"Charles is finally getting the respect he's wanted all along," says CA vice president Toth.

Some CA-watchers have publicly speculated that Wang has placed CA in a position where he might step down in a few years, with Kumar as his successor. But Wang, whose 80-year-old father is still practicing law in San Francisco, says he has no intention of retiring early, no intention of retiring at all. Even if he's already more than halfway to being a billionaire.

"I have more than I'll be able to spend," he acknowledges.

But IBM and Microsoft still sell more software than CA. Gates still gets more recognition and, with $10 billion, is far richer. There are still dozens of smaller software companies out there who may make good takeover targets, new technological frontiers to conquer, and not a few people who'd still like to see Wang's high-flying software machine come crashing to earth.

All of that'll keep a guy like Charles Wang going. "You can't change your personality," Wang says. He's grinning. "It's a lot of fun. You couldn't find a better way to spend your life."

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