The-TIP | Veritas - Or Is That "Veracle" ?

Veritas - Or Is That "Veracle" ?

Sometimes Wall Street does the right thing for the wrong reason. When the stock price of New Economy golden child Veritas Software tumbled following the dismissal of longtime CFO Ken Lonchar for lying on his resume, the market guessed one thing right: the Mountain View-based storage software company may be vulnerable. Ironically, the presence or absence of Lonchar has little to do with it.

While Lonchar’s reputation within Veritas was not stellar, analysts still viewed him as an Uber-CFO, someone who had not missed an estimate in 16 straight quarters. Given his rep in the financial community (which is what shareholders care about), why do rumors persist that his firing was an axe job by CEO Gary Bloom?
Therein lies the real issue at Veritas. Bloom’s predecessor, Mark Leslie, was a tough act to follow. Leslie turned a tiny, money-losing company into a $1 billion enterprise, but was popular with employees for more than just making many of them millionaires. Leslie, who retired in 2000, worked out of a glass-walled office to let his work ethic set the tone for the company. He had a humble, low-key demeanor and a reputation for being accessible to the rank-and-file.

In social settings, Bloom seems affable and laid-back, but he is different than Leslie. Bloom quickly established greater distance from employees, moving his office to a private location. Worsening matters, old-guard Veritas employees feel Bloom has little respect for their accomplishments and culture, preferring to surround himself with former Oracle executives. (Starting shortly after his arrival, Bloom let go of many longtime employees, and the high number of former Oracle staff he has replaced them with has led remaining employees to dub the company "Veracle.")

Although some Veritas veterans, fattened during the ‘90s, probably needed to give way to a hungrier team, many remaining employees feel slighted. Add it all up, and it’s a recipe for enough employee paranoia to hatch conspiracy theories about the firing of a very public figurehead.