Avids turnaround man
No matter how good the technology, Krall sees execution as key
Glen Dickson -- Broadcasting & Cable, 10/8/2000 8:00:00 PM
When reminded of the revolving-door phenomenon that has plagued top management at Avid Technology, current CEO David Krall displays a keen sense of humor. "If you look at Avid's history, it has roughly had a new CEO every three years," he says. "One could guess that perhaps I've got two years left on my clock. At which point, I'd say I'm going to do the absolute best I can in those years to take the company in the direction I believe makes sense today."
But Krall has no plans to leave the nonlinear editing giant anytime soon. After taking over Avid's reins last October when CEO Bill Miller and President and COO Cliff Jenks resigned, Krall has tried to reverse several years of weak financial results and strategic slip-ups by focusing on customer service and seeking new business in Web publishing.
Within a month, Krall announced a major restructuring effort at Avid aimed at cutting $20 million in annual costs. He eliminated 200 jobs and announced a new focus on Internet-related editing products and workgroup solutions. He was promoted to fill the vacant CEO spot in April 2000.
Krall brings a broad base of academic training and business experience to the task. After developing an affinity for electronics as a teenager, Krall studied electrical engineering at MIT. He obtained a master's degree specializing in the digital signal processing (DSP) of audio by working at Texas Instruments as part of a MIT's highly selective co-op program. Krall then took an engineering position in Cambridge with General Computer Co., where he programmed video games for Atari.
After a year, Krall moved to Optima Systems, a contract R & D firm.
Krall's early career convinced him to go to business school.
"My experience was that it didn't matter how good your technology was, what really mattered was how good you-as an overall company-could organize around a business strategy and execute that strategy," he says. "The best technology did not always win. My express goal for going to business school was to be able to tie together the business strategy and execution part with the technology part."
Krall excelled at Harvard Business School, winning the entrepreneur of the year award there for one of his inventions: a backup battery for laptop computers for which he received a patent. He was recruited by Acuson Corp., a California-based manufacturer of ultrasound equipment for the medical industry, and put in charge of developing its next-generation ultrasound machine.
An acquaintance from Harvard, Joy Covey (who would later become CFO of Amazon.com), recruited him to Digidesign, a developer of professional audio workstations. (Before he came on board, the company was swallowed by Avid and Covey went to Tewksbury.)
Digidesign proved a successful acquisition for Avid, and, in the meantime, Krall moved quickly up the ranks, becoming VP of engineering in 1996 and COO in 1998.
When Miller and Jenks left after a poor third quarter 1999, Krall was called east and appointed Avid's president and COO. He didn't mind the challenge.
"What we realized at Digidesign was that no matter how good we were doing as an operating division, we couldn't successfully impact the overall company from across the country," he says.
Excluding acquisition-related charges, Tewksbury, Mass.-based Avid has posted a modest profit for the first two quarters of 2000. Krall suggests the company has turned the corner.
"I'm very much enjoying the challenge and enjoying the opportunity. And I can see, feel and taste the progress we've been making here."
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