Designing the Future.

These days, it's not uncommon for software companies that have been around for longer than three years (and especially those showing a profit) to be labeled dinosaurs-or at least to have that sentiment implied. Still, Carol Bartz scoffs at the notion that her company, Autodesk, is a brick-and-mortar company.

"It's hysterical to be called [that]," says the 52-year-old CEO, particularly given that the sophisticated 3-D computer-aided design (CAD) automation software that Autodesk is famous for could hardly be called retrograde. But the company is nearly two decades old-equivalent to a century in Internet time-which leads some arrogant young entrepreneurs or skeptical industry observers to look askance at the older software company and wonder aloud at its ability to adapt to a new universe.

Sticks and stones, says Bartz, who is more than comfortable with the fact that Autodesk's flagship product AutoCAD, which shipped its 2 millionth copy last year, has been around long enough to win dozens of awards and inspire confidence among architects, engineers and builders. And being based in Silicon Valley, surrounded by the chaos of energetic, aggressive (if often fleeting) dot-coins, only serves to stoke the competitive fires.

"Think of the analogy of going to school," she says. "If you go to school with a lot of smart people, they push you. If you're the only bright person there, you're going to fall back. Being out here, you really get pushed to stay good."

And for Bartz, who has been CEO since 1992, that has meant diversifying Autodesk's revenue streams by getting into additional areas of the business directly related to the company's core competencies. Almost immediately after joining the company, Bartz identified mechanical engineering as a particularly promising discipline and invested resources into products for that sector, including Inventor, a 3-D feature-based solid-modeling and drawing-production system, designed to support adaptive design and greater collaboration among the teams assigned to a project.

Collaboration--or the lack of it, in many cases--became a recurring theme in Bartz's hunt for ways to squeeze inefficiencies from the design industry. "There are probably 50 different parties associated with a building like this," Bartz says, gesturing to Autodesk's spacious San Rafael, CA, headquarters. And those various parties-who include contractors, subcontractors, various kinds of architects, mechanical engineers, the owner/builder, to name a few-have not traditionally communicated very well, she says. "In fact, 20 to 30 percent of the costs on any building is a waste because people have the wrong information," she says. "So they're trying to make decisions and they have a drawing but don't have the current availability information or the current costing information."

And then came the Web, a low-cost but potentially robust delivery channel for real-time collaboration among geographically dispersed partners. Bartz saw an opportunity to solve some of the industry's troubles with a new venture called Buzzsaw.com, a comprehensive B2B e-commerce marketplace for the $672 billion-dollar building design and construction industry. The e-hub, spun off last year but still 40 percent owned by Autodesk, uses Web-based technology developed by its founding company to streamline what have traditionally been fragmented and inefficient processes for design collaboration, construction administration, bid management, and buying.

Buzzsaw.com allows a particular construction project to have a secure hosted Web site where all involved parties can get in and view the correct, up-to-date information when they need it. They can also further reduce costs in bid management. "If you're going to build a building, you want to let the local electricians know they can come bid on your project. Why not do that online?" asks Bartz.

Introducing the Web as a tool for delivering content in this particular industry was a delicate operation, because while the process of collaborating on the design and building might be simplified via Web-based technology, the design software itself has to maintain the same level of sophistication. "If we're ever really going to democratize design information, it's about approachability and ease of use and sophistication," says Bartz. "You still have to have a really big engine running under the hood, and yet you have to be able to get this stuff done."

The Internet, to some degree, offers simple delivery of some very complex information. "It really links the entire design process and supply chain. You can really collaborate across the globe or across the company, as you desire," she says, adding that having access to real-time accurate information will drastically change the way projects are executed. "Real e-commerce is going out there and understanding price and availability. One of the reasons you love going to Amazon is you know immediately whether you can get the darn thing or not," she says. "If you're trying to design a specific kind of part, why bother if it's not the right price or specification? So rather than design it, and check it later and then redesign it, you're doing it automatically."

Indeed, it's innovations like Buzzsaw.com that have earned the company and its CEO respect among analysts, even while profits dragged some last year and questions persist about how fast or how much the company can realistically grow. "They're moving into vertical markets with AutoCAD and they've opened up new areas and diversified their product mix and those are very valuable things they've done while Carol has been there," says William Broun, analyst with investment firm AG Edwards. The firm had issued a "maintain" rating on Autodesk stock, which fell during the Nasdaq sell-off in March and April, with shares trading recently at around $24, down from a 52-week high of $56.

"The top line growth hasn't been as robust as we'd like to see," he says, adding that opportunities abound but only some have been realized. "Some of it is an executional issue, but some of it is that the design software market is a slower growth market than it has been historically." At press time, however, Autodesk had announced its sales were up 11 percent and that second-quarter profits had outperformed expectations--earnings for the quarter had risen to $25.3 million, or 43 cents a share, from a paltry $5.69, or 9 cents, a year ago--and A.G. Edwards had upgraded the stock to "accumulate."

Buzzsaw.com, Broun says, was a move in the right direction, though it did not provide an immediate boost. "When you're roughly a billion dollar revenue company, it's tough for something small like that to make an immediate impact on the numbers. Some of it is a time issue."

Bartz, for one, sees no shortage of opportunity, and therefore plenty of room for growth in the market Autodesk serves simply by virtue of its scope and depth of reach. "Look around you--if God didn't make it, my customers did," she says. "It isn't a market that was interesting last year, but isn't interesting tomorrow. We need more cars and buildings and roads and infrastructure and those things that make society run. And my customers make those things, design those things."

Analysts and shareholders alike applauded another of Bartz's moves: the purchase of Montreal-based Discreet Logic, a developer of solutions for creating, managing, and distributing digital content, including the kind of spectacular special visual effects used in such films as Gladiator and Mission Impossible 2. The acquisition in March of 1999 allowed Autodesk to merge the new company with its own Kinetix division for film and video production, and video game and Web content development, and create a much larger visual effects software operation.

Some of the Discreet software--as well as Autodesk's animation software, 3D Studio MAX--will be used in the development of 3-D Web content for online sale of products that require a high degree of visualization. "So the ability to look at a car, walk around that car in real time, open the door, and look inside--our products do that," says Bartz. An avid online and catalog shopper--particularly for shoes--she is critical of the level of sophistication of Web shopping graphics.

"One of the things that irritates me so much right now about shopping on the Web is the fidelity of what I'm looking at," she says, recalling the experience of shopping for a gift for her nephew last Christmas and being unable to determine the quality of the toy. "Finally I gave up and had to buy it in the store because I couldn't get enough of a visualization of it to know whether it had substance to it."

It isn't that the technology isn't there, she says, but there continue to be barriers to delivering the kind of sophisticated graphics necessary to make online shopping as meaningful as it needs to be. "It's still pretty [complex] software. And it's still a bandwidth problem," she says.

That hasn't stopped Autodesk from opening its own online store to sell AutoCAD 2000 via the Web, although the sale of software products arguably does-n't require the same kind of visualization. The company has e-Stores in Great Britain, Ireland, and Singapore; about 60 percent of Autodesk's sales come from outside the U.S. But as far as Bartz is concerned, the e-Store is just a natural extension of any overall e-commerce strategy.

The more exciting part, she says, is making the company's products so seamlessly Internet-enabled that "you no longer feel like you're sitting at a desktop application. You feel as though you're really one with the Web, like you're totally wired in, you can pull content down, publish automatically to the Web," she says. "So we're redoing all of our previously considered desktop apps to be Internet enabled. And that's actually more important than the e-Store."

In addition to making products Internet-enabled, Autodesk is giving them wheels. The recently released Autodesk Onsite View is the first software for viewing design drawings on mobile devices. Rather than relying solely on paper drawings to deliver updates to design plans, architects, engineers, and construction managers can view and mark up complex design drawings via WinCE-based handheld devices. And increased availability of bandwidth for mobile devices should open doors to new levels of design automation.

Being agile enough to shift strategies mid-stream--or redesign desktop-based software to be completely Web-enabled--is a tall order for an 18-year-old company with 3,000 employees worldwide. And the pace of change leaves Bartz herself with little free time. But the Minnesota-born CEO, wife, and mother of one says successful balance is about always being genuinely present, whether during work or family time. But, as far as the idea of achieving perfect harmony and balance between worklife and personal life, Bartz has no illusions.

"There is no such thing," she says. "I have this theory--that you just catch it before it hits the floor."

CAROL BARTZ

Chairman, President, and CEO Autodesk

"Being out here [in the Valley] you really get pushed to stay good."

Birthplace: Wynona, MN

Age: 52

Education: Computer science, University of Wisconsin, 1971

Family: Husband, Bill Marr; daughter Layne, 12

Leisure Interests: Spending time with family and gardening.

Major Influence: Her 95-year-old grandmother, who raised her in Wisconsin after her mother's death. "She just never let anything get in her way, never let you have excuses. It was, "So what? Just do it."