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Under new CEO, NCR shunned Dayton and embraced Georgia

Hurd’s departure, Nuti’s arrival, Teradata spin-off seen as key steps to company’s exit

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By Tom Beyerlein and Jessica Wehrman
Staff Writers Updated 12:37 PM Sunday, June 7, 2009

DAYTON — Looking back on it, state Sen. Jon Husted sees three key moments in the community’s foundering relationship with NCR Corp.

The first came March 29, 2005, when the company lost its president and chief executive, Mark Hurd, to Hewlett-Packard. The second was Aug. 1, 2005, when Hurd was replaced by Bill Nuti. The third came Jan. 8, 2007, when NCR announced it was spinning off its Teradata division — and, with it, executives with strong Dayton roots.

With every step, NCR’s leadership grew increasingly isolated from the company’s longtime hometown until, last week, Nuti announced it will move its world headquarters and nearly 1,300 jobs to an Atlanta suburb, costing Dayton its last Fortune 500 company.

“As a Monday morning quarterback, I can tell you there are probably lots of things that could have been done differently (by state and local officials), but I don’t think anything would have changed the outcome,” Husted said. “They (NCR executives) were never interested in engaging on the issue.”

‘Cost savings’

Over a period of four years, NCR swung from planning to expand its Dayton headquarters to pulling the plug on almost all local operations.

Speaking through public relations staff, Nuti has declined to be interviewed by the Dayton Daily News. In a memo to employees, he said the move “will drive tens of millions of dollars in cost savings for NCR over the next 10 years.”

In a prepared statement, NCR said the decision was based on “available workforce, infrastructure, incentives given, the government tax structure and benefits to NCR employees, future employees and stakeholders.”

It’s not clear how many Dayton area employees will be offered jobs at the Georgia headquarters. The move is to be complete by the end of 2010.

In March 2005, local officials were confident they had arranged a deal that would help Hurd’s NCR to expand the Dayton headquarters. Dayton offered $2.65 million in assistance, city documents show.

“With Mark Hurd, we had a CEO who really cared about Dayton, who felt Dayton was a place where NCR could thrive and prosper,” said Montgomery County Administrator Deborah Feldman.

Officials were optimistic about the expansion when Hurd resigned in what Husted calls “a very tragic departure for us.” Hurd’s interim replacement, James Ringler, told officials the expansion would be on hold until NCR named a permanent CEO.

Nuti’s arrival

That man was William R. Nuti of New York.

Nuti, 45, came to NCR from Symbol Technologies Inc., which was torn by securities fraud scandals under Nuti’s CEO predecessor, Tomo Razmilovic. Several Symbol executives were convicted of charges stemming from the scandals and Razmilovic remains a fugitive, living in Sweden to avoid extradition.

Nuti was charged with cleaning up the company, but Symbol had mixed financial results during his tenure. He restored Symbol to profitability and achieved record revenues, but on the same day Nuti was hired by NCR in 2005, Symbol reported a $30.5 million second-quarter loss.

Nuti is a defendant in a class action shareholder lawsuit in federal court in New York. The plaintiffs say Nuti’s post-Razmilovic reforms were “only cosmetic,” and accuse him of artificially inflating revenues and making false statements in Securities and Exchange Commission filings about Symbol’s accounting methods.

NCR’s board of directors required Nuti to move to Dayton as a condition of his employment, but the board changed its mind in July 2006 because Nuti was “dealing with a family health matter.”

In an August 2006 interview with the Daily News, Nuti asked if he planned to keep NCR’s headquarters here. “We’re very happy in Dayton,” he said. “We continue to give a great deal of our time and resources to this community, and we will continue to be a strong advocate for this community. I think NCR is committed to Dayton for the long term.”

But local officials say Nuti was never a big Dayton booster, and drastically cut communication with them.

“There was communication through 2006, then the NCR file goes quiet,” said Shelley Dickstein, assistant city manager for strategic development.

“When Bill Nuti took over, there didn’t seem to be any kind of relationship there,” said John Landess, executive director of the Turner Foundation. “My feeling is, Bill has a pretty good size ego on him. You come from the East Coast or the West Coast, then Dayton seems like small potatoes.”

Officials of the Dayton Development Coalition, which had a good relationship with Hurd and his predecessor, Lars Nyberg, were frozen out by Nuti’s administration.

“At some point, it abruptly stopped — the communication stopped, the phone calls were not returned, the meetings were not set up,” said coalition vice president Michael Gessel. “It was dramatic.”

Lost ties

Dayton lost allies at NCR in 2007 with the spin-off of Teradata. Some of the Teradata execs had been working on the Dayton headquarters expansion under Hurd. Local officials had more reason to fret in October 2007, when NCR opened executive offices in New York City and many top executives left Dayton. “It sent a pretty strong signal,” Landess said.

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