InformationWEEK, November 24, 1996


Dr. An Wang, 66, founder of Wang Laboratories Inc., last week named his son Frederick A. Wang, 36, to the presidency of the minicomputer and office systems company.  The senior Wang, who says he has no plans to retire, will continue to oversee corporate staff functions as chairman and chief executive officer.  Fred Wang, who will serve as treasurer as well as president, will be responsible for all principal line functions, including worldwide marketing, sales, service, support, manufacturing, and research and development.

The burning question on users' and investors' minds is whether Fred Wang, said to be responsible for Wang's poorly-selling VS minicomputer line, will be able to restore the Lowell, Mass. company to the healthy dominance it enjoyed as the first vendor of high-precision desk calculators in the 1960s and the first seller of full-screen office word processing systems in the 1970s.

Wang began losing customers to Digital Equipment Corp., Data General Corp., and IBM when those firms brought out their integrated office software packages: DEC's All-In-1, DG's CEO, and IBM's Disoss, Profs, and PC software.  Despite attempts to beat those vendors at their own game by pushing the 4-year-old VS line of general-purpose minicomputers in 1982, Wang Laboratories lost $30 million last quarter and Fred Wang has declined to predict the current quarter's results.

As observers wonder if Fred Wang can stop the firm's decline, An Wang will stay on as CEO.

The younger Wang brings to the position 14 years of experience with the company.  He joined Wang as a programmer after graduation from Brown University in 1972, and has worked his way up through the ranks as director of office systems marketing, head of research and development, treasurer, and executive vice president.  His appointment as president is widely taken to mean that he will succeed his father as chairman and CEO.

The last president of Wang was John F. Cunningham, who resigned in July of 1985 when it became apparent to him that Fred Wang, already called the "crown prince," would be the company's next CEO.  Cunningham, who had also been under fire from users and analysts who claimed he sacrificed service and support for corporate growth, is now chairman and CEO of Computer Consoles Inc., a directory assistance systems company turned general-purpose minicomputer vendor headquartered in Waltham, Mass.

Following Cunningham's resignation, An Wang himself took control of the company.  In April, J. Carl Masi, executive vice president of sales and marketing, resigned rather than take another position overseeing the firm's joint ventures, and Wang Laboratories was left with yet another management gap.  The Wang community may be surprised at the suddenness of Fred's promotion, but it was no secret that he was soon to be named to fill the power vacuum at the top.

Fred Wang's work on the VS 300, Wang's top-of-the-line system, together with the departure of the other top executives, made his appointment a logical move, according to George DiNardo, executive vice president at the Mellon Bank, in Pittsburgh, one of the largest Wang sites.  "Our view of Fred is that he's quite talented and can do it.  That may be the minority view, but that's our view.  We saw him take control as a senior executive and bring the VS 300 operating system to fruition, and I think he's as qualified as anyone else.  Whether he'll be able to turn around the income picture I don't know."

DiNardo predicts that Wang's strategy is first to bring out a "seamless PC" - one that is 100% IBM-compatible - in the first quarter of next year.  "Wang's current IBM-compatible PC is, like so many of the trade, an almost-compatible," DiNardo explains. "The new desktop, large-capacity Wang PC is reputed to be seamless and powerful, a lot of capacity for the buck.  That will help Wang a lot."

The second element of the strategy is expanded sale of the VS 300 to corporate customers.  DiNardo reports that the once bug-ridden VS 300 operating system is over most of its difficulties and keeps getting better.  He has the same kind of operating system headaches from IBM and DEC and he is satisfied with Wang's level of service and support.  "But then," he notes, "no one services Mellon in a bad fashion and stays around.  And we do a fair amount of our own maintenance."  Other sources think Wang Laboratories has a deeper plan to bring out a new high-end system, called the 7100, to exorcise the sour feelings some users still have about the firm as a result of the VS 300.

DiNardo was particularly impressed by Fred Wang's work with Mellon on the VS 300 operating system problems a few months ago.  "I said I'll be happy to bring you in here if you run the gauntlet.  And Fred and his men spent half a day listening to our gripe list and did make some reactions and corrections.  If that isn't executive demeanor, I don't know what is.  So am I surprised by Fred Wang's promotion?  No.  Am I disappointed?  No.  Am I enthused?  I think so." -- Diana ben-Aaron