OK, so mistakes were made. That was recognized at the highest level.
If you think the company is not on the correct course, what (reasonable and feasible) corrections would you recommend to management?
85 replies (most recent on top)
And my favorite quote from that article:
"And besides, SAS is still an S Corp. (a type of incorporation status).
You can’t take that public. They still have to install SEC compliant software accounting, although they have started that."
Wasn't "compliance with GAAP" the only significant thing holding up this IPO when it was announced several years ago? Interesting. In twenty years was any progress made? I hear that little to no progress is being made with this attempt's "SEC compliant accounting".
2023: SAS IPO will be delayed until 2025
...layoffs
2024: SAS IPO will be delayed until 2026
...layoffs
2025: SAS IPO will be delayed until 2027
...layoffs
2026: SAS IPO will be delayed until 2028
...layoffs
and so on...
https://wraltechwire.com/2002/02/22/former-sas-president-has-few-kind-words-for-goodnight-sees-no-ipo/
From the NY Times article:
"...THE company traces its roots to a time when computing was costly and for the few...."
Sounds similar to:
"...Robert Moses designed NY highways when car ownership was costly and for the few...." (Ignoring and firing those who spoke of mass transit as time marched on.) - The Power Broker by Robert Caro.
Then the last two paragraphs of the article:
"Mr. Goodnight regards his new rivals the way a confident card player might. He likes the odds, and he likes his hand. We’re pushing as fast as we can to stay ahead on the cutting edge of everything,” he says. “We’ll do fine.” "
As Alfred E. Neuman says - "What, me worry?"
https://www.nytimes.com/2009/11/22/business/22sas.html
“No one can match our toolbox” … See photo. Oh the irony.
https://www.computerworld.com/article/2597048/goodnight-turns-over-most-operations-at-sas-to-new-president.html
Who is a Andre B?
There's nothing to be done to fix SAS. This thread is silly.
Whoever creates these must get a hearty chuckle from all the commotion.
"Ha! They fell for it again!"
Practically speaking, what does an IPO even mean for current employees other than more external scrutiny that could motivate more layoffs? You can bet your bottom dollar, JG will still be the controlling shareholder and SAS will not likely use an IPO to raise capital for future investment. It’s an exit plan for JG and his heirs.
Until SAS can execute on solid innovation/growth, does anyone here really think employees will get a financial windfall from the company going public? SAS has a pathological management problem from the top down. The thread of this pathology runs throughout the company, even though it can be observed there are some decent individual managers.
JG himself is a decent human being, as evidenced by the relatively small number of people who have been laid off, the incredible workplace culture, he pioneered, etc.. However, this is not going to save the company. The only thing that will is a radical rethinking of product conception, design, research and development in a reimagined SAS with 50% less headcount. Does JG have the will to make this happen? Doubtful.
It's just a ruse
In that case, it is an extremely expensive and labor-intensive ruse. I think that a more realistic explantion is that another year is needed for the reasons that were outlined in other posts. When the end of 2025 approaches, if we are without IPO-readiness, then we should make a new assessment of the situation.
So if we are not having an IPO (which I agree with), then are we for sale? If not, is this all just an exercise to get us ready for when the king dies and the heirs have to do something with the kingdom?
I don't believe there will be an IPO. It's just a ruse to prevent more good employees from quitting and go to other companies. Even if there will be an IPO, it will likely be limited to a small percentage because he does not want to lose control of his company. I doubt stock options will be rewarded a la FAANG companies. At best, employees can buy SAS stocks at a slight discount like 5% or so a la IBM style.
He does not need to go IPO if he doesn't want to.
He doesn't need more money. He already has more than he can spend. SAS has no debts.
SAS is his baby and his creation. This captain will go down with his ship. It is his prerogative. Afterwards, his family can sell SAS if they wish since there is no heir apparent to take over the company.
An IPO has no requirements on sales, profitability, or revenue-per-employee. You need three years of audited financial statements (which requires waiting until 2025) and you'd prefer favorable market conditions (e.g. if recession in 2025, wait until 2026).
If you're turning 82 in 2025, you're also thinking of your children, so not wanting to wait.
Finally, although layoffs have been small, they aren't the only factor. Over the past three years, SAS has laid off 1-2% annually -- but has lost another 3-4% due to attrition. If this trend continues, by 2025 SAS will have completed a ~25% headcount reduction. That's "enough" to IPO.
The owner is a billionaire. So, he doesn't need anyone's permission to IPO. He's telling you forthrightly what he plans to do.
With 2024 on the horizon, it’s like SAS as a company is running a full marathon, they are way behind, not even close to the finish line with maximum allowable time already up. The race officials have packed up and gone home. It’s getting dark outside but SAS is still chugging along somewhere around the 15 mile marker. The sadness is palpable.
To be clear, stated Andre B. financial indiscretion was unrelated to SAS. Chair gone missing occurred during his exit proceedings from SAS.
Does anyone else think SAS would no longer exist as an identifiable tech entity had Andre B. taken over? From where I sit, he was a narcissistic poser and very possibly a plant from Larry Ellison in circa year 2000 attempt to surreptitiously gain control of SAS. After he was terminated from SAS, didn’t Andre’s tight @$$ wind up in federal prison for some financial indiscretion? Apparently, his personally-owned $5000 executive ergo chair went missing during his exit proceedings. Someone remarked “it was found attached firmly to his a--hole”. The hubbub must’ve caused his wounded ego to forget he had walked out with it stuck in place.
OP: you asked for reasonable and feasible.
Collectively, all the posts this far have provided you with a long list. If uou scrutinize each item, you will see that each and every item COULD have already been executed by now!
Hmmm. Perhaps a few(if any!) SHOULD not receive execution. A good business mind with an eye cast towards the SAS financials would be able to easily make the SHOULD decision for each item on the list.
It is highly doubtful that any item mentioned on this thread will come as a surprise to JG. He is NOT a stupid man. Stubborn perhaps, but certainly not stupid.
So far, a few layoffs have occurred. That is a drop in the bucket compared to what a buyer will do. Most assuredly, a buyer will not have JG's benevolence or his slow pace.
The execution pace thus far is a snails's pace for a company that hopes to be sold or IPOed by 2025. Originally it was supposed to be 2024 but that can got kicked down the road to 2025. The point being is that SAS is not acting with the urgency of a company which is serious about a sale or an IPO.
Last idea: if JG is unwilling or unable to quicken the pace to a level necessary for an IPO or sale to happen by 2025, JG needs to hire an interim CEO. Andre B is not the only person who does that...he just arrived at SAS before JG was ready to act. Let's hope the next interim CEO does not arrive too late.
Flirting with selling and actually selling are two entirely different things. JG is acting like a man flirting with selling, but not serious about selling. Hence his slow pace. So let's discuss that possibility.
If JG chooses to go down with the ship, hold that thought just a second and recall JG said years ago something like "when I am done with SAS, they will be throwing dirt over me". So if JG wants to remain with SAS "till death do us part" he needs to get WAY more serious about protecting the SAS Foundation renewal cash cow revenue stream. SAS Foundation is what made the company great so give the remaining SAS Foundation customers a nice ride,"till death do us part"...and let go of as much of the non positive ROI as possible. That is the best dignified path towards "till death do us part"
Time is way past being on SAS' side. So, either way, get on with it.
Good luck to all!
"Is there ANY incentive for a SAS9 Foundation customer, who is SAS9 Foundation and only ever will be SAS9 Foundation customer...to want to stay with SAS? No. THIS is the biggest reason for declining revenue at SAS. The old saying applies: if you do not take care of your customer then someone else will."
And:
"The sad truth is open source Analytics continues to eat into the traditional SAS Analytics market. There are tens of millions of lines of SAS code running in homegrown and vendor developed enterprise applications around the world."
I see many job postings for SAS + Python, and have seen firsthand the interest to unplug SAS9 and replace it with Open Source at two very large and well-know health insurance companies. Some very loyal SAS consultants are taking contracts that involve unplugging.
Given the large and complicated code base mentioned above, unplugging can be challenging. But it seems like many companies are interested in at least trying or evaluating the feasibility. This has increased in the past few years.
To offer a morsel of charity to Oliver and his team, their efforts have not been diligently followed through for 3+ years -- this includes the loss of 100+ top ML/AI and infrastructure devs to West Coast tech.
It's also been ~4 years since they were a tight unit pushing hard to make CAS/Viya successful. In reality that could've made some difference.
"Bill Gates... handed over the reigns to someone with the energy, drive, and ability to reinvent the company. For whatever reason JG chose not to do that..."
Be fair, now. JG tried to do exactly that, with the Forester aka Big German. That person was given years, and some of SAS' best engineers, to create an innovative product in an attempt to reinvent the company.
It just didn't work, that's all.
From early on Bill Gates was also willing to take Microsoft public and share considerable equity with the people who helped him build the company. Microsoft created several thousand millionaire, many who were employees for less than 15 years. SAS created 2 Billionaires. A few hundred early SAS employees are low digit millionaires after 30+ years of work on plantation SAS.
I think the sad reality is the JG just doesn't really give a sh-t anymore. That's what happens when tech pioneers get old.
Look at Bill Gates....he lost interest in Microsoft years ago, but handed over the reigns to someone with the energy, drive, and ability to reinvent the company.
For whatever reason JG chose not to do that and now it's too late.
How many under 45 Analytics and business professionals are using "classic SAS" (version 9)? How many undergrad and grad students are learning it and if they do, does it become a highly developed core skill in their toolbox? How many current and future decision makers even consider SAS relevant anymore?
The sad truth is open source Analytics continues to eat into the traditional SAS Analytics market. There are tens of millions of lines of SAS code running in homegrown and vendor developed enterprise applications around the world. The World Programming/Altair "innovation pirates" provide alternatives for many of them.
Like the founder, Version 9 is aging out. Death is the cold hard reality of life. If SAS intends to survive, it needs to figure out a way to turn a very healthy cash flow from what remains of diminishing V9 revenue stream and reinvest that in the future innovation. The only way to effectively do this is with a massive reduction in headcount, significant change in leadership function and some combination of top level technology and talent acquisition.
"Viya is not good. Customers aren't biting it."
Agree. Sadly, Viya is probably at the top of the long list of negative ROI products that SAS still keeps on life support. Puzzling. I don't understand why losers products deserve a long term and ever continuing commitment.
"SAS 9 EBI is not good. Horrible deployment interface and process taking hours to deploy."
Ease of deployment seems to be an after thought for SAS for much of their product portfolio. Alot of customers pass on SAS products for that reason alone - they simply do not want something so darned complicated that they have to pay PSD to install/maintain. Call it death by complexity.
"The only thing good is SAS 9 Foundation...the bread and butter , but it has not been kept up with a lot of new features and functions and SAS 9 will be sunset with no SAS 10."
SAS 9 is the cash cow. A declining cash cow, but still THE cash cow. It is extremely puzzling and disappointing why it is mostly ignored. Taken for granted it seems. Is there ANY incentive for a SAS9 Foundation customer, who is SAS9 Foundation and only ever will be SAS9 Foundation customer...to want to stay with SAS? No. THIS is the biggest reason for declining revenue at SAS. The old saying applies: if you do not take care of your customer then someone else will. As someone who has loyally used SAS non stop since 1980, it pains the heck out of me to say that. Wake up SAS! Please.
"So what's left that's a good product for SAS other than risk and fraud?"
Nothing that I know of. Maybe JMP, but I have my doubts about it having an exciting revenue per employee metric. The founder seems more interested in being an introvert coder than a charismatic leader. Not good.
"Maybe SAS needs to acquire more companies that have good solutions/products"
Most companies that are for sale are not looking to acquire more companies. Adding to that, the two founders are old. No disrespect to either is intended but acquisitions take energy that most seniors no longer have So, I just don't see this in the cards.
I really hate typing all this because SAS has been a meaningful part of my life since 1980 as a user and as an employee. Their current position in the market is depressing. Even though alot of it is self induced, there are still alot of talented people there working there butts off. They are the ones I feel most badly for. And they are not wealthy either, so if/when the SAS ship goes down, they have the most painful drowning.
Viya is not good. Customers aren't biting it.
SAS 9 EBI is not good. Horrible deployment interface and process taking hours to deploy.
The only thing good is SAS 9 Foundation...the bread and butter , but it has not been kept up with a lot of new features and functions and SAS 9 will be sunset with no SAS 10.
So what's left that's a good product for SAS other than risk and fraud?
SAS acquired Kamakura in 2022. Hopefully this will help with SAS Risk products.
Kamakura was a privately-held company that provided specialized software, data and consulting that helps financial organizations across the spectrum – banks, insurance companies, asset managers, pension funds and more – manage a variety of financial risks.
Maybe SAS needs to acquire more companies that have good solutions/products that the market wants if SAS cannot invent good or new ones in-house.
Is the U hotel profitable? Is the CA school profitable?
Are these 2 things separate from SAS or they are part of SAS because they're owned by the same owner? If they're profitable then good but if they're not then sell them off. Less burden on the (SAS) company.
"I wish for the Big Guy to have someone he can trust to give him honest and true feedback and for him to be willing to listen to the feedback even if negative. He should not have sycophants surrounding him. He should have good people around him."
There have been good people that told him the truth. They are all gone because it doesn't work to tell him the truth. This is not a staff problem. The company is, and always has been, a reflection of JHG.
“If SAS hired (and fired) correctly, they could run the company on 50% of the current number of employees…”
I first heard that remark 30 years ago. The person who said it was one of our best in R&D. They left the company.
Another of our best said that we only hired Bachelor’s degrees who were breathing. They had to meet both qualifications :-). That person left the company too.
The company has always been run this way. As @obsd+1pcUX1Ev says:
"Forget it, Jake. It's Chinatown."
"I'm curious about the folks saying SAS should sell JMP. It's already a subsidiary instead of a division. Isn't it adding to the bottom line?"
Being their own company better allows their founder to decide whether or not a sale is in his best interest.
The status quo makes hiding their profitability or lack of MUCH easier. Same logic applies for the hotel.
Precisely! SAS had at least 100 to 200 hard-core engineers with FAANG-level talent! Many of us did basic research and kept our skills moving forward on our own dime/time! our ongoing contributions kept seriously innovative corners of the SAS product infrastructure and feature sets moving forward! For at least the past decade, we were compensated considerably below our worth to SAS. Once Covid came and remote work went mainstream, we left to go where our talents are truly appreciated and justly compensated!
I’m grateful for a long career at SAS, but the fact is JG prides himself on getting a bargain. He squandered what should’ve been our increased compensation and some form of equity on too many mediocre people in bullsh-t jobs. The sad results are evident to this day. If SAS hired (and fired) correctly, they could run the company on 50% of the current number of employees, build competitive products and have real growth.
I'm curious about the folks saying SAS should sell JMP. It's already a subsidiary instead of a division. Isn't it adding to the bottom line?
Start doing basic research seriously again.
SAS has been dropping the R in R&D for too many years.
Don't keep hiring and keeping mediocre people.
Spend money and get some high quality/hardcore people from top-notch universities and companies. FAANG companies get all the crème de la crème because they're willing to pay for what they get. SAS should learn from this.
"SAS needs to restore the rule of law, and by that I mean accountability for failure, and for poor management in particular.
If you want to know who gets a seat on the lifeboat, you need to know who is capable of high-quality, thoughtful, and productive work. Until that is done, it doesn't matter how much you reduce expenses because you're depending on the same people who didn't have what it takes to be active participants in the company's success in the first place."
Bingo! Very well said @iwv+1pAuPTtd
First and foremost, SAS needs to get rid of unproductive people and hire the right ones that are not afraid to give truthful feedbacks to the Big Guy.
I wish for the Big Guy to have someone he can trust to give him honest and true feedback and for him to be willing to listen to the feedback even if negative. He should not have sycophants surrounding him. He should have good people around him.
"Daniel Lubetzky, billionaire founder of Kind Snacks, attributes his success to a simple decision: surrounding himself with people who feel comfortable giving him honest, raw feedback.
Nobody can be a perfect leader, Lubetzky says. In his case, he often gets things wrong, and can be impulsive and easily blinded by passion — but his friends and colleagues call him out when he’s about to make a mistake, he adds.
“If you don’t surround yourself with those people, then it is so much harder to [achieve success] because you can go in to ‘I’m amazing’ mode, and not realize when you are screwing up,” Lubetzky tells CNBC Make It.
His advice isn’t necessarily uncommon — but it’s easier said than done. “Environments that discourage hearty debate are shockingly common,” Lubetzky says. “Particularly successful and impressive CEOs end up developing a following of sycophants that are just too afraid to challenge them, and it really can destroy us.”
Here’s his advice for finding those people who will challenge you and healthily encouraging their pushback.
- Find the correct people
- Create an environment that fosters ‘hearty debate’ "
For details see this article:
https://www.cnbc.com/2023/10/26/self-made-billionaire-daniel-lubetzky-shares-his-no-1-tip-for-success.html
"OK, so mistakes were made. That was recognized at the highest level."
What does "That was recognized at the highest level" mean? Who admitted what?
- Version 9 is going to sunset. Oliver was correct that V9, like aging steam, locomotives is in decline, and will eventually come into the “station for its last time”. SAS needs to face this reality and begin taking steps to wind it down. No more than 500 people should be employed, maintaining, and supporting all aspects of Version 9. This should be reduced by 5-10% per year because a decade from now it’s doubtful V9 software will have much relevance.
- Viya infrastructure via CAS contains some innovative distributed systems technology, and a strong framework for building highly scalable AI/ML. This can be repurposed to create a backbone for new enterprise analytics products.
- In concert with 2., SAS should merge with or acquire leading edge cloud database technology (SingleStore anyone?). SAS did that similarly in 1984, when it acquired System 2000 from Intel and the MVA Base Engine (largely from their engineers) became a backbone MVA technology with modern SAS datasets, indexing, etc.. Problem is SAS was never able to duplicate the success of that data management paradigm on modern, multithreaded distributed platforms (copious posts on various threads here have discussed this).
- With 2. and 3., SAS will finally have the basic infrastructure necessary to create new enterprise analytics products/solutions that can successfully deploy in modern cloud and on-premise environments.
- It’s going to take significant change in SAS leadership and the elimination of current job positions incongruous with 1. to 4. to make this happen.
"Jim, we're on v9.999999999999. We need a new release. What would you like us to do?"
"That odometer ain't rolling over while I'm still around. Just add a 1 to the end and ship it. The customers will understand."
SAS saying words that they want to sell or do an IPO is a huge disconnect with their actions. Actions speak louder than words usually. Specifically the actions of driving away v9 customers by saying words like "there will never be a v10". Customers are voting with their feet and their feet are not moving towards Viya. Instead, their feet are moving away from SAS. Makes no sense to self erode your best revenue stream.
Leadership positions need to be filled with those having robust biz experience. The Big German departed SAS, went somewhere else, and it took six months for them to see that he did not have what it takes. Academics alone seldom equate into the business world.
Lastly, force JMP to jump off the SAS te-t. Agree with the other posters about that.
The Art Department, in all its incarnations, is safe.