Time of Turbulence

After a period of great strain and tension within the company, Mike Ford, who was, more than any other person, responsible for developing the marketing and sales strategies that resulted in AutoCAD's enormous success, and in building the marketing, sales, and support organisation from a single person (himself), to more than 80 people, submitted his resignation.

This is the memo I issued announcing his departure and the text of the remarks I made at the company meeting the following day. This was not a happy time for anybody in the company, but it was a significant event in the company's history, so these documents are included here.

Memo to everybody

To: Everybody
From: John Walker
Date: 5 February 1986

Mike Ford has submitted his resignation as Vice President of Marketing and Sales, effective today.

I have accepted his resignation.

Effective immediately, Richard Handyside will assume the role of acting Director of Marketing and Sales. Richard continues to hold the position of Vice President of European Operations, and will be spending one week per month in the London office to continue his work there. Richard is a founder of Autodesk, Inc. and has been responsible for building our sales and marketing efforts in the United Kingdom since the company's inception. Please extend him the help he will need in filling the job he'll be assuming.

We will immediately begin the process of finding a permanent replacement for Mike Ford.

The events of the last two weeks, and indeed the last several months have placed many of us under extreme stress. We have all found ourselves wondering what was happening as rumours circulated and we considered what they might mean for the future of our company. We have come this far by trying to build a company which was open, fair, and honest. That is how we must continue.

There will be an all-company meeting tomorrow in the administration area (where we usually have the monthly meeting). Because of the extraordinary seriousness of what has happened, the meeting will be longer than usual, and will start promptly at 5:15 P.M. I urge all of you who are concerned with the future of our company, unsure as to what has been happening, upset with the way things have been handled, or just confused to attend. I will try to explain what has happened and what happens next. I will answer all of your questions. I will stay until there are no more questions. All of the rest of the management of the company will be available to respond to your concerns.

In addition, I would like to reiterate that this company has always had, and will continue to have an open-door policy. If there is any matter you want to discuss with any of the management of the company, please bring it to us directly. If there's anything you'd prefer to discuss on a one-to-one basis, that offer stands and will stand.

If we continue to build our company on the principles which got us here: honesty, hard work, rewarding the people who do the work, and striving to minimise the politics, we can look back on this period as a time of testing for the company as it continued to grow. We have had what it took to build one of the singular successes of the 1980's in only three years. We have what it takes to continue. Let us begin today.

Remarks at the company meeting

Thank you all for coming.

This has been a time of great stress on all of us. Our energies have been diverted increasingly from the tasks we all need to do to take advantage of this tremendous opportunity we share and spent on speculation about people, about events, their consequences, and the future of our company.

Those of us who have been here since the company started in my living room on January 30, 1982 know that we tried to build something very special here. We were all people who had worked for companies large and small and always saw those companies squandering much of their resources on politics, on empire building, on image, on status symbols, on so many things not connected with success.

Like fools perhaps we imagined a company that worked differently, a company that concentrated entirely on the clearly defined goal of success in its industry, producing products of the highest quality, marketing them honestly to people, and efficiently delivering the fruits of our labours to the people who made it happen, rather than to a bunch of nameless investors or managers.

I won't recount all the times people said it wouldn't work; couldn't work. That it would all come apart when we reached 25 people, or 50 people, or 100 people. That when our sales reached $100,000 a month, or $1 million a month and we had “a real company there” we would be like everybody else, that the magic would be replaced by plodding, the creativity by repetition, the innovation by mediocrity. That is, after all, what we'd seen happen so many times before in so many other companies; it was only really fun in the early days when you were losing money and everybody was struggling together to survive, doing any job that needed to be done, working whatever hours it took, expanding their scope of expertise as the company called on them to grow, and grow fast into new jobs.

And then the money starts to come in, and the walls go up, and the hierarchy begins to grow, and the restrictions come down, and before long it's the “job” and not the “challenge”. And sometimes when that doesn't happen, we read about companies that just come apart because of too rapid growth.

Is that happening here?

I think not.

There has been some changes. We have lost some people who have been here from the very early days. We have lost people who have worked long hours, applied great skills, and whose dedication to building this company, and unique insights into strategy and the way to make it into reality were major contributors to our success. We will sorely miss these people.

But let us look at what has not changed.

Our company is the acknowledged leader in its industry.

Our main product, AutoCAD has a market share in excess of 50%. This is a situation that only rarely ever occurs in industry, and presents the company that achieves it with virtually unlimited opportunities.

Our two new products, AE/CADD and CAD/camera have, in less than 6 months, both emerged as the unit volume leaders in their respective markets. We are making money on both products. We are on our way to success with both.

We dominate the channels of distribution for our products. Almost all of the dealers qualified to sell CAD sell AutoCAD. We have OEM arrangements with a list of companies which represent a Who's Who of high technology. Our position in education is commanding, and our innovation in addressing that market has been so great that even those who try to copy our strategy can't keep up.

Out oft-repeated goal was to make AutoCAD the standard for CAD on this planet. Today AutoCAD is the standard for CAD on this planet.

We have built a vital and fast-growing applications program. By putting tools in the hands of creative people, we've brought about an efflorescence of creative products that other CAD companies have failed to produce given decades. And we've done it in less than two years.

Our marketing effort has consistently won awards indicating it is the best in the industry. It is almost unheard of for a company our size to go it alone, spurning ad agencies and PR firms. Our team in Marketing has worked miracles with meager resources. The people who did that work will be given more resources to continue it. And I am confident that this group of people, who have shown themselves to be the best in the industry, will continue to distinguish themselves with continued awards and with results.

Autodesk isn't about safety and caution. It's about going for opportunities and conceding nothing to the competition. We've set up Project Gold, to address the Fortune 1000. It's a program unlike that of any other company. That's never stopped us before. And unlike so many other programs, ours is going to work. It's already beginning to work. And it will contribute mightily to our results that we gather to discuss this time next year.

We're also going after the government market for CAD. That's a very different kind of selling job than the one we've been doing so far. So what? We'll make it work too. And the goals here are high.

In the operation of the company that generates the money, we've grown with remarkably few pains, and we're running well. We're taking more orders from more dealers, processing them efficiently, manufacturing them rapidly and correctly, checking them so that we put the best product we can manage in the customer's hand.

Our support has been praised in InfoWorld. It is repeatedly praised in letters we receive. Few companies have even tried to support a product as complicated as ours over the telephone. None has done it as well.

Our accounting and financial operations continue to be a model of smooth operation. And the phones are working better.

Our development of the next AutoCAD continues, aiming for entry to Beta testing this month. This new product will have an impact as people begin to realise what they can do with it as major as the introduction of AutoCAD in 1982, or of AutoCAD 2.0 in 1984. Our competitors simply have no idea what is about to happen to them. Their products, placed against our new AutoCAD, will be bows and arrows against the lightning. We're wading into the workstation market with Sun, Apollo, MicroVAX, and IBM PC RT products in the mill. All those high priced players now have to contend with AutoCAD and face the fact that AutoCAD is what the buyers want.

Our new products continue to progress. We've moved AutoLISP from concept to a shipping product. We have two new Architectural products under way, as well as a major upgrade to AE/CADD.

And there's a few wild ideas in the back room that are going to turn into industry-stunners before all that long.

That's what hasn't changed. We're a smoothly running, lean and efficient, creative, productive company. We've just completed our fiscal year at the end of January. We came in on target, with sales and earnings exactly what we aimed for. Once again, we've met our numbers. Every time we do that, we convince more people that we're going to be around for the long haul.

Last month, I got up here and said we'd do something about profit sharing. We're doing it. We've taken some of our profits and we're giving it to all of you who made it happen. Unlike some companies where the management skims the pot, we're doing it like this: everybody who's worked here full time for the full year gets $1000 of bonus (we have to do tax withholding on this, of course). If you've been here less than a year, or work part time, you'll get the proportionate amount for the time you've worked. That's it. It doesn't matter what you get paid, what you do, or who you work for—you get $1000. You deserve it. You earned it. Thank you.

Let me promise that we'll continue to do something about profit sharing in the future. I'll share the details when they're firm and I can make a commitment I know we can keep.

So let's talk about what has changed. As I said, we have lost some people. I don't want to go into details here of what happened when, who said what to whom, or what who said what where. Events and situations occurred which led me, in conjunction with all of the current senior management of the company and most of the founders to conclude that we were going down the wrong road with the company. We decided to remedy that situation. We decided to eliminate the stress which was hurting us all, and to pay the price of the consequences. We made our decision and we acted. Now things will get better if we all work to make that happen.

The politics stops today. The whispering stops today.

The honesty, openness, and fair dealing that built this company is back. We never intended it to go away, but maybe we were so preoccupied with immediate problems that we failed to reaffirm what has made this company so different and so successful. If you have any questions about what has happened, or have any concerns about what is going on, you can discuss them with me or anybody else in the company regardless of position, in private or in groups.

This company is not supposed to be run top down. Our success has been a consequence of how well we listened to our users, our dealers, our OEMs, and others we deal with. Information has to flow from the people in direct daily contact with these people up, so that the right decisions get made where to apply our limited resources. We will not falter because we lose some people at the top. We will not falter if we were to lose everybody at the top, as long as the people who are really doing the work continue to do it, and continue to listen to what they hear, share it with others in the company, and act to meet the needs they feel.

I don't care what you do in this company. If you think we're heading in the wrong direction, if you smell a problem we're overlooking, if you see a threat we seem to be ignoring, tell me or somebody else in the management. This isn't a privilege. It's part of your job and key to our long term survival.

Just a week over four years ago, 16 people decided to start a company and do it right this time. Today, 160 people have the opportunity to start from that base and build something much bigger, so that four years from now we'll all be the envy of the latecomers, the founders who were there in the early days, the people who saw the opportunity become reality.

Mankind is the animal that makes tools. In each generation, only a few people get a chance to create new tools. Very, very few get to contribute to making a tool that changes the lives of first hundreds, then thousands, then tens of thousands, and someday millions of people. We are in that position. Our work so far has put us there.

I feel privileged to have shared this experience with all of you. Now we keep on working together to pursue this opportunity. Few ever get this kind of a chance. Rarely is there such an opportunity to so immediately see the consequences of your hard work. This is the fulcrum, the point where we make the potential of AutoCAD really begin to change things in a large way, and where we decide to keep this company on the track that brought us so far so fast.

Peter Barnett drew this architectural stair detail in 1984 to illustrate architectural applications of AutoCAD. It has appeared in numerous advertisements and brochures, and has been on the sample drawings disc from AutoCAD version 2.0 to date. Bob Elman spent a great deal of time cleaning up this drawing into its present form.