The walls at Emulex Corp. are gray, devoid of art for the most part.
No one seems to notice. In local parlance, workers, from engineers up to executives, are “heads-down.”
The pace at the Costa Mesa maker of networking electronics is fast. There isn’t time for distraction.
There’s been plenty of potential for distraction: a big executive shift in the past six months, as well as two acquisitions in the past year.
Emulex, which makes host bus adapters that link computers on data networks, last year paid $180 million for Roseville-based Sierra Logic Inc. and $39 million for San Jose’s Aarohi Communications Inc.
In September came more big news: longtime boss Paul Folino was stepping back to become executive chairman. Jim McCluney, who came to Emulex in 2003’s buy of Bothell, Wash.-based Vixel Corp., took over as chief executive.
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“I got here on a Monday,” said John Warwick, who joined Emulex in late August as senior vice president of operations. “By Tuesday of that next week, we announced we were going to acquire Sierra Logic. A week later, we announced Jim was going to be our CEO.”
Welcome to Emulex.
The executive shift was long in the works. But it still was epic in Emulex’s world.
Folino, chief executive since 1993, is one of the county’s most prominent executives. He’s built Emulex into Orange County’s fourth largest technology company with a market value of $1.6 billion last week.
Folino’s given money and his name to the arts, education and politics. A close friend of Gov. Arnold Schwarzenegger, Folino is chairman of moderate Republican group New Majority.
McCluney said he’s worked closely with Folino for the past few years.
Earlier, Emulex had another successor to Folino in the wings. In 2002, Folino became chairman and passed the president’s title to Kirk Roller, who also became chief operating officer. At the time, Folino described Roller as “a leading candidate to succeed me.”
Things didn’t work out that way. Upon McCluney’s 2003 appointment as president and chief operating officer, Roller was made president of worldwide sales. He’s no longer with the company.
“One of the things we have to look at is succession planning,” said Mike Rockenbach, chief financial officer. “We needed a COO, a successor to Paul. Jim had already run a public company and obviously had a lot of years of experience in technology. So he seemed like a great candidate.”
The move meant McCluney beat out Roller and some other executives who had been at Emulex longer.
“It’s always a tough decision to make because, as a company, individuals want to grow as part of the company and be promoted and achieve higher-level positions,” said Rockenbach, who worked with Folino since 1991 and now works directly with McCluney. “But there are points in time where you’ve got to go get somebody who’s been there before and done it, so you don’t have the pitfalls along the way.”
Five months into McCluney’s leadership, Emulex executives decline to point to a No. 2.
Notable executives include Warwick, who oversees operations, and a pair of executive vice presidents, Rockenbach and Fred Gill, who oversees worldwide sales.
The transition from Folino to McCluney has worked, said Stuart Berman, Emulex’s chief technology officer, who worked with McCluney at Vixel and under Folino during an earlier Emulex stint.
“It’s hard to say Jim or Paul did this or that because the whole company has changed,” he said. “You don’t know if it’s Jim or Paul or just us aligning.”
McCluney calls the shots now, according to executives. Folino has stepped back but still plays a role, they said. He has a hand in integrating the recently acquired companies.
A soft-spoken Scotsman known for his humor and humility, McCluney has brought his own style, according to executives.
Take Emulex’s 13-member executive team meetings each Monday morning in the second-floor boardroom.
Folino preferred to have more talks outside the boardroom when a decision was due, according to executives.
“Paul didn’t like it to get too tense,” Rockenbach said.
Cordial disagreement is supported by McCluney, who, executives said, quietly watches the ebb and flow of discussions before weighing in.
“I run a bit of a ‘balanced democracy,'” McCluney said, “where I invite input. That way, I get diverse input and perspective around key issues. Having said that, the leader has to be decisive and know when to step in to ensure timely decisions are made.”
Emulex hosts regular lunches where workers and executives mingle. Thursday is eggroll day. Friday is bagel day. There’s an annual barbecue in the parking lot of the company’s campus.
Emulex has an Angel Stadium suite and hands out baseball tickets liberally, a holdover from sports fan Folino’s chief executive days.
Attending games isn’t a perk, per se, according to executives. It’s a chance for different departments and company layers to mix it up so people can better work together in more critical moments.
“It’s such a big company, and there’s so much brain trust around,” Warwick said. “Part of the value is how do you get collaboration, how do you get ideas coming in one door and how do you disseminate those to the guys who can do something with it?”
Dave Goff, who joined Emulex two months ago as chief information officer, spent his first few weeks traveling to Emulex’s U.S. offices, including in San Jose, Massachusetts, Washington and Colorado.
“In my first seven weeks, I’ve probably held 70 to 75 one-on-ones,” he said.
Goff got what he calls “the heartbeat” of the company.
“The goal is to see “what we currently have, what’s working well, what’s not working well, and what are we missing so that I can sort of do an analysis to match that up with our corporate objectives,” Goff said.
One of those objectives is linking Emulex with operations gained in last year’s acquisitions. They include the company’s first India outpost in Bangalore, which came by way of Aarohi.
The subject came up during a recent lunch with McCluney at Costa Mesa’s Center Club, Goff said.
“As approachable as he is, the meeting invite said ‘I just want to catch up,'” Goff recalled. “He had a 2.5 hour lunch with me. We just sat down and he shared with me some of his observations and expectations for IT. He asked me what my thoughts were and what I’ve seen, where I thought I could help.”
Goff said he took the same tack on his U.S. tour. After work hours, Goff invited employees he was visiting to shoot pool.
“I haven’t felt new at all,” Goff said.
The executives don’t mingle a tremendous amount outside the office. As Rockenbach said, “Neither Jim nor I golf.”
There are the occasional lunches and dinners. But those are generally with clients.
Asked what a conversation might be like during happy hour at the corner tavern, Berman said:
“I think we’d probably talk about the things we see in industry and life that are changing so much that are exciting to us. We have really institutionalized the sharing of ideas because we do meet frequently to talk about strategy, and it’s everything from me putting out far-out ideas to processing work.”
THE TEAM
– Michael Rockenbach: 45, executive vice president, chief financial officer since 1997. Worked in senior finance and accounting positions since 1991. Played key role in company’s move from Nasdaq to New York Stock Exchange in 2003. Previously worked at Western Digital.
– Fred Gill: 49, executive vice president, worldwide sales, since 2000. Previously director of business development for Pinnacle Multimedia. Held senior sales positions with 3Com Corp. and U.S. Robotics Corp. in the 1990s.
– Marshall Lee: 50, executive vice president, engineering, since 2002. Oversees global engineering operations. Previously served in similar role at Quantum Corp. and in senior management roles with IBM Corp. and Western Digital.
– Sadie Herrera: 57, executive vice president of human resources and facilities. Joined in 1988. Responsible for design, development of company’s Costa Mesa campus. Previously worked at Ex-Cell-O/Textron Corp. in human resources management.
– John Warwick: 41, senior vice president, operations. Joined the company in August to manage global manufacturing operations. Previously consulted with Emulex, other tech companies. Served as senior director for materials for Western Digital from 1997 to 2000.
– Stuart Berman: 47, senior vice president, chief technology officer. Returned to Emulex with the 2003 acquisition of Vixel Corp. First worked for Emulex from 1992 to 1996.
– Steve Berg: 40, senior vice president, corporate development. Joined in September. Previously vice president at investment bank Punk Ziegel & Co. Helped develop information systems for Chase Manhattan Bank.
– Dave Goff: 43, vice president, chief information officer. Joined in January. Previously vice president, CIO at Applied Micro Circuits Corp. Served in various roles at Texas Instruments Inc. and Silicon Systems Inc.
– Mike Smith: 44, executive vice president, worldwide marketing. Joined in 1998. Previously worked in marketing management positions with Adaptec Inc., Western Digital.
– Ameesh Divatia: 42, senior vice president, general manager of intelligent network productions. Joined in 2006 with acquisition of Aarohi Communications, where he was chief executive. Previously worked as chief product strategist at Cisco Systems Inc. and as founder, chief technology officer of PipeLinks Inc.
– Bob Whitson: 51, senior vice president, general manager of embedded storage products. Joined with the acquisition of Sierra Logic, where he was cofounder, president, chief executive. Also served as worldwide marketing manager for Agilent Technologies Inc.
– Randall Wick: 53, vice president, general counsel. Joined in 2002. Previously vice president, chief operating officer, general counsel of TelOptics Corp., Samsung Electronics America Inc. and AST Research Inc.
