Sas Case Study

9397 words 38 pages

Succeeding with old-fashioned values in a new industry 1 (revised September 2010)

Adapted by CH Besseyre des Horts from C.A. O'Reilly III & J. Pfeffer (2000) : Hidden Value, how great companies achieve extraordinary results with ordinary people, Harvard Business School Press, pp. 99-117. 1


THE SAS INSTITUTE : Succeeding with old-fashioned values in a new industry TREATING PEOPLE DIFFERENTLY (and better) than they expect to be treated, and differently than other companies in the industry treat them, is not something that only works in retailing. Even in the world of high technology and software development, there is a case to be made for being different. And few companies in this industry are
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"They decided to develop a uniform program that could be used over and over, and that could solve lots of different kinds of [statistical] problems." Having developed such a system, they leased SAS (Statistical Analysis System) to other agricultural schools in the region and to some pharmaceutical companies. When the soft money began to dry up, they were told they could stay on at the university but would have to pay their own salaries. Instead, they left and formed their own company. When that company, SAS Institute, Inc., began in 1976 as an independent entity, it already had 100 paying customers and was cash flow positive. Except for a mortgage on its first building, SAS Institute has never had any debt, nor has it ever had to raise outside venture or other equity capital. What about ownership of the intellectual property? "North Carolina State ceded them all copyrights on the program in exchange for free upgrades." If this seems generous, consider that in the 1970s there really wasn't a software industry and no one knew what software was worth. As Jim Goodnight recounts, when his wife would tell people her husband worked in software, they thought it was some type of clothing or undergarments. One of the cofounders, Anthony Barr, sold his 40 percent stake in the company for about $340,000 in 1979. Jane Helwig left to found another software company, Seasoned Systems, with her husband and then decided to attend medical school. She now practices obstetrics/


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