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Tod Nielsen, President and CEO, Borland

Tod NielsenBorland's new boss has a tough job ahead of him, with both investors and customers looking to see how the company positions itself for the future.

Tod Nielsen was named president and CEO of the Cupertino, Calif., software development company Nov. 8, replacing interim chief Scott Arnold.

A former executive with Microsoft , Oracle and BEA Systems , Nielsen brings a wealth of both engineering and marketing expertise to the table: two skills very much in demand at Borland right now.

He inherits a company that a week prior to his arrival posted its second straight disappointing quarter to Wall Street investors. Borland posted a net loss of $4.8 million for the third quarter, while in the second quarter officials pointed to a net loss of $17.5 million.

Nielsen's predecessor, Dale Fuller, stepped down from his role as president and CEO when the preliminary Q2 numbers were released.

Nielsen inherits a company that is also in the middle of a transition from developing standalone developer tools to one that is focused on application lifecycle management (ALM). The effort falls under Borland's Software Delivery Optimization (SDO) initiative, launched in September 2004, to bring software development and business processes under one product line.

Since then, the company has been revamping its product line around the new initiative, which is a combination of in-house development and acquisitions such as Legadero and TeraQuest.

Into this environment steps Nielsen, who talked with internetnews.com about what's next.

Q: What are your first impressions of Borland?

I've been working with or competing against Borland ever since my career started with Microsoft back in 1988. And now that I'm here on the inside I'm excited about the passionate people here that want to win. I'm motivated and feeding off that energy and excited to see what lies ahead.

Q: Do you anticipate any executive changes within the company?

There are no plans. The team we have in place is a great team and has been working together well and really driving the direction. Hopefully I can add some direction and we can move things forward.

Q: Anyone you're specifically looking to bring in?

We're always looking to bring in new and great people but there's no one specific individual. But with folks I've worked with or know, we've got some great opportunities to add to the Borland employee base and we'll certainly be doing that.

Q: Borland had a disappointing second quarter, which is what I guess led to your predecessor's exit. How do you plan to turn it around to make your investors happy?

I think the focus that I'm putting into the team right now is "How do we make sure we win long term?" And so the way the investors are going to win and be happy is if Borland can thrive and take things to the next level and show license revenue growth over the long term.

So, this isn't a quarterly issue, this is our clear strategy and direction in showing license revenue growth. My focus is to figure out how we can do that in the quickest way possible and yet still give us time to do the right things to drive our strategy forward.

Q: Is there a fine line between keeping investors happy in the short-term while adapting your software for the long term?

The issue is we get to tell them what the strategy is and, if you will, communicate. Once, internally, we have it all defined, we need to over-communicate to [Wall] Street and investors and the community saying, "this is where we're going, this is our direction -- measure us by these metrics."

And I think the dashboard metrics we'll set out around license revenue growth will be in the one-year and two-year time frame, not in the 90-day or 180-day time frame.

My expectation is that investors are going to say, "That's great, a new leader can come in and take the company in the right direction and as long as he can show results in the future, we can be patient and support that."

One of the things I'm finding is there's a positive association about Borland, and people really want Borland to win and succeed, so I don't think there's this, "Tod, you have 90 days and see you later if you can't do it."

People are saying do what it takes to do the right thing and drive the company forward; I hear that from the board, from customers and employees and the folks I've been talking to since I got here.

Q: You've inherited the SDO initiative. Do you see any need to change the company's roadmap or tweak it a bit? Are we going to see a fundamental change in what SDO is supposed to deliver?

I think the vision and the direction of the SDO and ALM direction is absolutely the right one. The Borland brand is such a positive thing around software development that we can be leaders in that space.

I think we're going to accelerate and expand our portfolio either by building products ourselves or potentially looking at some acquisitions to fill out the product line. But that's the right direction for us as a company. We now need to accelerate our delivery of that ourselves so that customers can really benefit from that vision.

Q: Do you foresee an emphasis on build or an emphasis on buy?

I think I'm open to both. Build, buy, partner, OEM, whatever it takes.

At the end of the day, my focus is the customers that are excited around this vision and direction that say we want it now, how do I get it to them in the quickest way possible? I think that includes building some stuff ourselves, partnering and acquiring.

Q: You were obviously picked for your extensive engineering and sales skills while at BEA, Oracle and Microsoft. What skills do you think will be needed most as Borland's chief?

I think where I can add the most value for Borland in the short term is in the engineering organization and giving some clear direction and leadership to our engineers on where we're going to focus our energy and help them prioritize and move in that direction.

I think when I look at what happened and the work that's been done in the sales organization and marketing organization, those guys have started down the path of really getting ready to drive the SDO vision and direction. The engineering organization is an area I can help with some leadership.

Q: What's your strategy to change people's perception of Borland from "that IDE company" to "that ALM company"?

I think the perception is that Borland is a company about software development, and certainly the IDE is the default we're known for -- our tools if you will.

Over the last five years there hasn't been as much of a clear articulation of, "This is who we are and what we stand for," and we've started to do that over the last year. I think you'll see us boost up our direction and vision and identity to the world -- our customers, our partners, our friends, our investors and everybody -- so they can realize where we are.

The good news is, it's a logical extension of the perception of what Borland is. The Borland brand is about software development, and when you look at the SDO vision, it's about taking software development to the next level and getting the efficiency and infrastructure and management so you can get the reliability of your software investment.

Q: Does this focus on ALM give the perception you're giving up on individual development tools such as JBuilder?

We're not giving up on development tools. We're adapting to the needs of our customers.

As the open source popularity and investments are happening in the community, a large number of customers are using that as part of their development portfolio.

It would be crazy for us to deny that's the situation, and so instead of turning our heads and not believing it's the case, we're doing the opposite and saying, "great, if that's what you want."

Our job is to make software development successful, and we're going to make sure our intellectual property and the Borland assets can be used the way customers want to use them.