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Chapter Six
Corporate Culture

The Cycle of Life at Novell

The Quarterly Cycle

There is a rhythm to the business of a computer company, a pumping action not unlike the cycle of a four-stroke internal-combustion engine. The movements of the piston—intake, compression (aka pressure), power, and exhaust—correspond to the fiscal quarters.

At the beginning of each quarter, product sales and shipments are relatively thin, employees are less tense, and fewer man-hours are logged. As the quarter progresses, the volume of business gradually builds. In the last month of the quarter, the pressure is on to achieve quarterly sales and shipment goals. The entire organization strains under the effort—employee nerves throb raw as overtime accumulates and sleep is sacrificed on the altar of enterprise. The phone lines buzz around the clock as deals are cut with distributors and other customers in order to get product out the door. The frenzy peaks in the final days, and in the last 72 hours the entire company is running at the proverbial 110%—beyond maximum effort. When the engine’s fuel finally ignites and the deadline passes, there is exhaustion, collapse, and in Novell’s case the satisfaction of having achieved or surpassed the goals. Like some huge snake, the market slithers away to digest the enormous meal of product it has just consumed.

The next workday morning a new quarter dawns and the cycle begins again.

As the quarter advanced and the fight for sales and shipments was increasingly joined, Ray always led his troops personally into battle. In the last month of each quarter, he focused on sales and shipments to the exclusion of everything else. He spent hours on the phone—at every moment of the day and week—talking with customers and distributors, making deals, giving discounts in exchange for large orders, flooding the market with NetWare. He would arrive at the office at 5:00 or 6:00 am to catch the East Coast customers and work the phones nonstop till 8:00 or 9:00 at night, only quitting when the last customer in the last corner of California went home for the night.

At the points in the day when he was unable to reach his prospects over the phone, Ray visited the areas of Novell responsible for getting product out. Judith reminisced about the early days in 1983, ’84, and ’85 when Ray, dressed in jeans, would appear in the warehouse and personally prepare the red boxes of NetWare for shipment.

“It was like a party,” she said. “We were all there, late into the night, filling the boxes with Styrofoam peanuts, shrink-wrapping, getting the product out the door.”

Just as each quarter had its own cycle of business, so was an annual cycle of business discernible. Novell’s fiscal year originally coincided with the calendar year. But much to Ray’s annoyance, the year-end holidays from Thanksgiving through New Year’s usually led to a slow­down in sales; a fiscal year ending in December meant a weak fourth quarter. So as previously mentioned (p. 125), in 1984 Ray decided to change it so that the first quarter ran from November through the last Saturday in January. This structured Novell’s cycle so that each quarter would end on a relatively strong month: January, April, July, and October.

The Trade Show Cycle

Novell also marched to other beats besides the rhythm of the fiscal year. There was a movable feast of product introductions. Trade shows provided an opportunity to come face-to-face with customers, analysts, and the trade press. Trade shows are also a forum where companies make announcements about their latest technological breakthroughs, alliances with other companies, and strategic direction.

In the early years, the major show for Novell was Comdex, generally held in Atlanta in May and in Las Vegas (its original site) in November. As the personal computer industry grew, a host of other shows were introduced: PC Expo, held in June in New York City, and shows in different regions of the country. Many targeted different vertical markets; for example, the Federal Office Supply Exposition, or FOSE, held in Washington DC for the government market. By the mid-1980s it was possible for a company supplying personal computer peripherals to exhibit at more than one show per month.

Like other computer companies, Novell planned most of its strategic announcements to coincide with industry trade shows. Craig would work with Ray and SuperSet on the theme and announcements for the show, while Judith handled the logistics of the booth, special events, and the presentation of the message. Craig and Judith and their staffs did most of the actual work for each trade show.

Mounting an exhibition for a major show is a huge undertaking. In a small company, or even a medium-size one like Novell was then, it will suck weeks of resources from the Marketing, Communications, Engineering, and Management departments. At Novell, detailed planning of a show exhibit usually began three or four months in advance of the event.

However, space for a show is often purchased a full year in advance, so show salespeople try to get commitments from current exhibitors for next year’s space. Of course location of the booth is the paramount consideration, and this decision is influenced by the location of a company’s competitors and allies. Space for special events outside the show must also be purchased far in advance of the actual show date, lest competitors buy up the choice locations in town. Spectacular special events have included a Beach Boys concert in Las Vegas and renting Disneyland for a night in Anaheim.

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