Computer Associates 2016 Annual Report Download - page 25

Our business may suffer if we are not able to retain and attract qualified professionals, including key managerial,
technical, marketing and sales professionals.
We operate in a business where there is intense competition for experienced personnel in all of our global markets. We depend
on our ability to identify, recruit, hire, train, develop and retain qualified and effective professionals and to attract and retain
talent needed to execute our business strategy. We also depend on our ability to perform these tasks with respect to
professionals from acquired companies, which ability may be negatively impacted by our efforts to integrate and rationalize the
products and lines of business we have acquired. Our ability to do so depends on numerous factors, including factors that we
cannot control, such as competition and conditions in the local employment markets in which we operate. Effective succession
planning is also important for our long-term success. Failure to ensure effective transfers of knowledge and smooth transitions
involving key employees could hinder our strategic planning and execution. Our success depends in a large part on the
continued contribution of our senior management and other key employees. A loss of a significant number of skilled
managerial, technical, marketing or other professionals could have a negative effect on the quality of our products. A loss of a
significant number of experienced and effective sales professionals could result in fewer sales of our products. Our failure to
retain qualified employees in these categories could materially adversely affect our business, financial condition, operating
results and cash flow.
General economic conditions and credit constraints, or unfavorable economic conditions in a particular region,
business or industry sector, may lead our customers to delay or forgo technology investments and could have other
impacts, any of which could materially adversely affect our business, financial condition, operating results and
cash flow.
Our products are designed to improve the productivity and efficiency of our customers’ information processing resources.
However, a general slowdown in the global economy, or in a particular region (such as Europe), or disruption in a business or
industry sector (such as the financial services sector), or tightening of credit markets, could cause customers to: have difficulty
accessing credit sources; delay contractual payments; or delay or forgo decisions to (i) license new products (particularly with
respect to discretionary spending for software), (ii) upgrade their existing environments or (iii) purchase services. Any such
impacts could materially adversely affect our business, financial condition, operating results and cash flow.
A general slowdown in the global economy may also materially affect the global banking system, including individual institutions
as well as a particular business or industry sector, which could cause consolidations or failures in such a sector. Approximately
one third of our revenue is derived from arrangements with financial institutions (i.e., banking, brokerage and insurance
companies). In addition, we derive material portions of our revenue from other industries such as telecommunications and
health care that rely on transaction processing. The majority of these arrangements are for the renewal of mainframe solutions
capacity and maintenance associated with transactions processed by our customers. While we cannot predict what impact there
may be on our business from changes to the financial industry, telecommunications or health care sectors, or the impact on our
business from the economy in general, to date the impact has not been material to our balance sheet, results of operations or
cash flow.
Any of these events could affect the manner in which we are able to conduct business, including within a particular industry
sector or market and could materially adversely affect our business, financial condition, operating results and cash flow.
We may encounter difficulties in successfully integrating companies and products that we have acquired or may
acquire into our existing business, which could materially adversely affect our infrastructure, market presence,
business, financial condition, operating results and cash flow.
In the past we have acquired, and in the future we expect to acquire, complementary companies, products, services and
technologies through a number of different vehicles, including through mergers, asset acquisitions, joint ventures, partnerships,
strategic alliances and equity investments. Additionally, we expect to acquire technology and software that are consistent with
our business strategy. The risks we may encounter include:
• We may find that the acquired company or assets do not improve our financial and strategic position as planned;
• We may have difficulty integrating the operations, facilities, personnel and commission plans of the acquired business;
• We may have difficulty forecasting or reporting results subsequent to acquisitions;
• We may have difficulty retaining the skills needed to further market, sell or provide services on the acquired products in a
manner that will be accepted by the market;
• We may have difficulty incorporating the acquired technologies or products into our existing product lines;
• We may have product liability, customer liability or intellectual property liability associated with the sale of the acquired
company’s products;
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