Al Shugart Al Shugart Al Shugart Overview Al Shugart is a co-founder of Seagate Technology, Inc. , and is now Chairman of the Board, President, and CEO of the company, which is the largest independent hard-drive manufacturer in the world. Born in Los Angeles, California in 1930, Alan F. Shugart received his Bachelor of Science degree in Engineering and Physics from the University of Redlands in 1951. He immediately went to work for IBM as a field engineer, and over the next 18 years managed development programs for IBM, including the development of the first rigid disc drive. In 1969 he moved to Memorex, where he served as Vice-president of Product Development until 1973.
In 1973, he formed Shugart Associates, Inc. , a floppy-disk drive manufacturing company. "We didn't have a clue about starting our own business," he later said after being fired by the venture capitalists who had put up the money to start the business. Over the next six years, Shugart was unemployed, worked as a consultant, bought a bar, and became a commercial fisherman. In 1978, Apple Computers had become the first PC manufacturer to include a floppy-disc drive in their PCs, and in 1979 VisisCalc would prove that the PC could be a serious business tool. In 1979, at a time when personal computers were about to become more than toys, Shugart and Finis Conner opened the doors of Shugart Technology.
In 1980, Shugart Technology became the first manufacturer to introduce a hard drive that could fit into the 5. 25-inch space used by the state-of-the-art floppy drives. Shugart Technology counted IBM among its early customers, but in 1985, IBM stopped buying disk drives from the company, which had changed its name to Seagate Technology, Inc. With the loss of IBM, the fledgling company lost almost half of its business and nearly folded. Also in 1985, Finis Conner and Al Shugart had a difference of opinion that caused Conner to leave Seagate. In 1986, Conner Peripherals opened its doors and became Seagate's number one competitor, a fiery rivalry that would continue until 1996.
Over the next few years, Seagate and Conner Peripherals leap-frogged each other as they developed advanced hard-disk drives and fought off a decreasing number of competitors. In 1991, David T. Mitchell, one of the co-founders of Seagate with Shugart and Conner, resigned as President and CEO of Seagate. Rather than replace Mitchell, Al Shugart assumed the vacant positions and temporarily dropped out as Chairman of the Board. Shugart changed the company's focus from market share and cost to making Seagate the first to bring leading-edge technology to the marketplace, a direction that took advantage of Seagate's vertical integration. Seagate manufactures its own recording heads, discs, substrates, motors, and custom integrated circuits, unlike many of its competitors, which purchase components from other manufacturers.
As part of his effort to diversify the company, Shugart began searching out other hardware and software companies that would complement Seagate. With purchases of software development companies such as Crystal of Canada, Palindrome, Dragon Systems, Frye Computer Systems, and Holistic Systems, Ltd. , Seagate moved into businesses that could allow it to bundle data management software with its disk drives. In 1996, however, Seagate surprised everyone by purchasing its most formidable competitor, Conner Peripherals, for $1. 1 billion in stock.
That move alone made Seagate the single largest independent disk-drive manufacturer in the world. Within a month of buying Conner, Seagate sold off the Conner Storage Systems Group to nSt or Corporation, a producer of disk array products used in data networks. With the purchase of Conner Peripherals, Seagate became a $7 billion company with control of more than 30 percent of the independent disk-drive market, which provides drives to companies like Compaq, Dell, and others who do not manufacture their own drives. Independent drive manufacturers also sell directly to the retail market as people upgrade their PC's storage capacity to meet the new demands of graphics, Internet downloads, and expanded software capabilities. But in addition to being the captain of the largest disk-drive company in the world, Al Shugart has another side; a side that may reveal more about him personally than his success in the volatile world of computers.
In 1996, Shugart got actively involved in politics as a way of fighting politicians. "We have the only legal system in the world where lawyers dominate the legislature, judiciary, and executive branch. We have to throw the bums out," he said. Shugart's methods, however, seem a bit odd. He is funding a campaign for the Congressional seat in California's 17 th District.
His candidate is a Bernese Mountain dog named Ernest whose campaign treasurer is a Basset Hound named Calvin. "This is my way of protesting how politicians and lawyers have really screwed up our government, which is stifling productivity, economic growth, and employment," said Shugart. In addition to backing his protest political candidate, Shugart has thrown his support behind a series of measures in California to reduce litigation. That has caused opponents to compare him to Charles Keating, the man convicted in the Lincoln Savings and Loan case of swindling people out of their life savings. Al Shugart and Seagate have been able to survive, while hundreds of other innovative executives and companies have collapsed under the pressure to stay on top of the industry and maintain their balance in the shifting sands of computer technology.
A true pioneer of the industry, Al Shugart continues to press forward. Sources Biography and Genealogy Index Brooks, Nancy Rivera; "Rival Disk Drive Makers Seagate, Conner Agree to $1 Billion Merger"; Los Angeles Times; Times Mirror Company; September 21, 1995 Business Wire; June 19, 1996 Dragon, Brian; "Seagate's Al Shugart – Top Dog in Disk Drives now takes on the Litigators"; Investors Business Daily; May 3, 1996 England, Robert Stowe; "Contempt of Facts"; Investors Business Daily; March 25, 1996 England, Robert Stowe; "Fake Consumer Advocates?" ; Investors Business Daily; March 3, 1996 Management Profiles; Seagate Corporate Information "Overview of Seagate Technology"; Seagate Technology, Inc. Schmitt, Richard B. ; "Seagate Technology's Mitchell Resigns as Board Decides to Shift Management"; Wall Street Journal; September 23, 1991 Shaw, Russell; "Get Out the Checkbook, Al"; Financial World; November 21, 1995 "Software giant in the making"; web /> Spiegelman, Lisa L.
; "What's Behind Seagate's Drive Into New Lines?" ; Investors Business Daily; June 29, 1996 McCoy, Charles; "Seagate to Acquire Conner in $1. 04 Billion Stock Swap"; Wall Street Journal; September 21, 1995.