Rubber Bracelet Adds Karma For New McAffee CEO

Can a corporation have karma? Dave DeWalt thinks so.

This 42-year-old executive, recently named as McAfee Inc.’s CEO, came to believe in the power of good deeds to deliver redemption after the high-tech economy crashed this decade.

DeWalt, who blazed up the corporate ladder of Documentum Inc. in his mid-30s, had barely settled into the corner office when the Sept. 11 terrorist attacks battered the stock market as well as software sales at the struggling Pleasanton company, which was already lagging rivals in an increasingly competitive multibillion-dollar marketplace for Internet content management.

DeWalt’s competitive drive — sharpened as an All-American in college wrestling — helped save Documentum despite a precipitous revenue decline, two rounds of layoffs and a painful plunge into red ink, a first for the company. Thirteen record quarters later in October 2003, he oversaw a heated bidding process culminating in EMC Corp. buying Documentum for $1.7 billion in stock.

Call it Zen and the art of corporate management. “If you can get employees to believe you can do good things with the business, good things come to you,” DeWalt said.

Now, DeWalt must pull off a similar reincarnation against tough odds as the fourth chief executive officer in six years at McAfee, the scandal-tarred security softwaremaker that is facing mounting competitive pressures in a rapidly consolidating and shifting global market. McAfee said this month that it had named DeWalt to replace interim chief executive Dale Fuller, a board member who stepped in when Chairman and CEO George Samenuk retired in October amid the unfolding stock-options backdating scandal.

This congenital optimist, who is leaving a cozy job as a top EMC Corp. executive and heir apparent to CEO Joe Tucci, starts April 2. The task at hand won’t be easy. The second-largest computer security softwaremaker is used to protecting others against threats, not defending itself against them. But McAfee finds itself under unprecedented siege as it scrambles to catch Symantec Corp. and grapples with growing competition from such companies as IBM Corp., Cisco Systems Inc., even DeWalt’s former employer EMC, which all have bought security companies in the past year.

The Santa Clara company also must clear its corporate image clouded by a string of financial storms. A recent federal investigation of stock-options grants led to the ouster of Samenuk and criminal charges against the former general counsel. And, in a reminder of another dark passage in McAfee’s history, early next month, Prabhat Goyal, the former chief financial officer of Network Associates, now known as McAfee, will face securities fraud charges, one of three executives implicated in a scheme to overstate revenues and earnings from 1998 to 2000.

The challenge of putting McAfee back in fighting shape intrigued DeWalt, who had been itching to once again run his own show. Until his appointment was announced, the company was rumored to be a takeover target. DeWalt says the market is confusing a temporary crisis with a true crisis. Continuing innovation and a thorough corporate housecleaning have positioned the billion-dollar company for a promising future, he says.

“McAfee is a company of great people and great products that got tarnished, that lost its way,” said DeWalt. “Executives didn’t do the things they should have done. … There is no excuse; these were obviously bad things. But there is not a whole lot wrong with the company. I look at this as a great opportunity.”

While discussing plans to transplant his wife and kids to Texas, the site of McAfee’s administrative operations, DeWalt reveals his softer side, showing off sentimental talismans he wears: a gold cross that was a wedding day present from his wife, and the Dutch medallion his mother gave him for his birthday as a reminder of his humble Pennsylvania roots. Wound around his left wrist is a thin black rubber bracelet that his young daughter gave him eight years ago during a beach getaway to bring him luck at Documentum.

It’s more spiritual connection than superstitious belief that he never takes any of them off.

“I get these feelings of karma sometimes,” DeWalt said. “Now I’m looking for a McAfee wearable.”

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