Computer Associates 2006 Annual Report Download - page 27

• We have 5,800 engineers globally, designing and supporting software to extend our functionality and
capabilities in the network and systems management, security and storage areas, and have charged
approximately $0.7 billion to operations in each of the fiscal years ended March 31, 2006, 2005, and 2004.
• Development activities are tied directly to customer needs and our five business units. Please refer to
“— Business Unit Structure” below for more information.
2. Strengthening Channel Partner Relationships
• Channel partners are critical to our success. We need a broad base of channel partners to reach a wider range of
customers. By developing strong relationships with systems integrators, distribution channel partners, value-
added resellers (VARs) and original equipment manufacturers (OEMs), we extend CA technology to
customers who otherwise wouldn’t have access to it.
• Distribution and OEM channel partners, referred to as “indirect” or “channel” partners, make up
approximately 11% of our new deferred subscription value — a figure we believe we can grow.
• We characterize our channel partners in two ways:
• Value — These channel partners sell CA solutions that require a high level of expertise to sell. In fiscal year
2006, we launched the Enterprise Solution Provider Program to recruit, train and educate VARs on CA
products and solutions. Through this program, we have authorized approximately 800 channel partners
worldwide to sell CA solutions and are now extending the program to global solutions providers who sell
solutions to multi-national companies.
• Volume — These channel partners, who sell CA products that don’t require the same technical expertise to
sell as enterprise solutions, are primarily geared toward small to medium-sized businesses (SMBs). We are
focusing on the SMB market by evolving our products to keep them current and relevant, such as our
Business Protection Suite, recruiting channel partners who know this segment, and increasing our
marketing efforts.
3. International Expansion
• We are enhancing our sales infrastructure in Asia Pacific and Latin America. In February 2006, we opened our
new Asia Pacific & Japan headquarters in Hong Kong.
• We are also growing our India Technology Center (in Hyderabad); tapping an important talent pool in the
Czech Republic (Prague) for mainframe development; and gaining important entree into fast-growing
countries such as China.
• We use our Customer Interaction Centers in Tampa, Florida, and Barcelona, Spain, as our global channel and
telemarketing sales-generators.
4. Strategic Acquisitions
• We consider acquisitions that will support our EITM approach, extend our market position, and/or expand our
geographic footprint.
• These acquisitions fill technology gaps in our portfolio, strengthen our position in core focus areas, and help
round out our EITM offerings to better serve our customers. In fiscal year 2006, we completed four significant
acquisitions (see Note 2, “Acquisitions, Divestitures, and Restructuring”, in the Notes to the Consolidated
Financial Statements for more information).
Business Unit Structure
We have aligned our product development into five business units. Each business unit is led by a general manager
who is accountable for the management and performance of their business unit, including product development and
innovation, product marketing, quality, staffing, strategic planning and execution, and customer satisfaction. Our
business units are Enterprise Systems Management, Security Management, Storage Management, Business Service
Optimization, and the CA Products Group. This structure allows us to become more closely aligned with our
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