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The End of Novell’s Visionary Era

Making History

What a ride Novell was!

From nothing in 1983 to a half-billion-dollar company in 1989.

From the wrong dream in 1980 to 65% market share in a billion-dollar industry in 1989.

This by every definition was history making, and for those on board, it felt like history making. It was a wonderful experience.

Sadly, it was hard to repeat. Many Novell alums, and Novell itself, have tried to make the magic again. Almost all have made some magic, but the Novell experience was unique in its magnitude.

The Epilog

The Novell that Craig and Judith departed from in 1989 did $422 million in sales. The Novell that Ray departed from in 1994 did $2 billion in sales after his final acquisition binge, but it was unstable. When Ray’s successor moved on, what he left behind was a company that spent years hovering near a billion in sales.

By the time of Frankenburg’s departure, the Internet Boom was in full swing, and it was a technology revolution that was pushing LAN technology into IT (Information Technology) backwaters. NetWare’s moment in the sun was finished and Novell had to reinvent itself. It did so successfully enough to remain a large and profitable company, but not enough to keep making history.

The Novell of the late ’90s and the 2000s could attract the finest talent—one of its Presidents, Eric Schmidt, went on to preside over Google’s explosive growth—but that talent couldn’t find a replacement for NetWare as a history-making product. Instead, the company moved up into the “niche hills” and thrived there. It could ably support those markets it had already carved out, but it was lackluster about carving out new marketplaces.

The people of ’80s Novell steadily moved on. Thanks to Novell’s success, and its habit of shedding both good people and bad, Utah Valley thrives as a high technology incubator.

Craig and Judith’s Clarke Burton Corporation became the Burton Group. It has prospered as a technology consulting company and grown to hundreds of people by 2010, but this happened under Jamie Lewis, another Novell alum. Craig and Judith moved on.

After Ray left Novell he continued to work with computer-related high technology startups until his death in 2006. Caldera Systems in Utah was his most prominent vehicle, but he had many other interests as well.

The Lessons

Here are the lessons I have drawn from this experience.

First, a business organization is a delicate beast. It must constantly watch the marketplace and constantly respond to changes. As a result, much of running a business is exploring: It’s researching what are right ideas and right implementations of ideas.

Second, when the business process is working well, it is quickly and efficiently filtering out poor implementations and poor ideas, and a few people suffer. When it stops doing this well, a lot of people suffer.

Third, there is a big difference between running visionary companies and well managed companies—so big that few people can do both. This means that you, as a potential employee, manager, or owner, need to decide which of these environments is going to suit you better. And you need to be watching management to see if they are well-suited for the company environment.

Fourth, there are exciting things happening around us all the time, and dull things, too. So be aware of the world around you. If you want to play with exciting things, look for the people conduit—where are people moving to? While Novell was exciting, it grew mightily. If you wanted to be part of Novell in its visionary period, it wasn’t hard. But if you choose a visionary company, fasten your seatbelt, I guarantee you the ride will be wild!

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