HOPKINTON, Mass.—Joseph M. Tucci, chief executive of EMC Corp., the world's biggest maker of data-storage equipment by revenue, isn't ready to walk away from a winning streak.
Tucci, who turns 65 in August, planned to retire as CEO this December. But with EMC enjoying a string of financial successes, he says his team persuaded him to delay his exit indefinitely.
Despite a looming global slowdown in information-technology spending, Tucci says that businesses are still investing in storing, analyzing and protecting huge amounts of data. EMC last week reported its ninth-straight quarter of double-digit profit and revenue growth and reiterated projections that 2014 revenue will exceed $28 billion. Acquisitions in areas such as cloud computing and virtualization, which turns a physical server into multiple "virtual" servers, have helped fuel its growth.
EMC did have a major stumble last year when information-security unit RSA suffered a security breach. The unit makes the SecurID tokens that millions of workers use to securely log on to their computers.
Tucci, who took command of EMC in 2001 after senior roles at Wang Global Services Inc. and Unisys Corp., predicts his eventual successor will come from within. At least three colleagues have their sights set on the top job, according to a person familiar with the situation. Recruiters say they include Pat Gelsinger, head of a key unit, and finance chief David Goulden. EMC declined to comment.
Tucci recently spoke with The Wall Street Journal about the outlook for IT spending, his leadership style and potential acquisition targets. Edited excerpts:
WSJ: How will slower spending on information technology affect EMC?
Tucci: We are well positioned because the IT industry emerges in waves. These waves tend to be tremendously opportunistic. I've got to make sure that we take advantage of the next wave.
IT spending declined pretty significantly in 2008-2009. World-wide, we predict that growth in IT spending will be 3.5% to 4% this year, half the growth seen in 2011. The world has got to deal with the slowdown in Europe.
WSJ: Will your 2012 revenue grow faster than IT spending?
Tucci: That's our belief. In my first full year as CEO in 2001, we lost $500 million. We had one storage product. Now, we are a different company. Our business is much more global. Plus we have bigger scale. The biggest change is the management team. The breadth and depth is superb.
WSJ: How do you lead and motivate your team?
Tucci: You can get anything accomplished if you get a team focused on a goal with passion and they really work together. I don't care how talented you are as an individual. If you can't play on a team, then you can't play here. If you disrupt the team, you are going to be out of here. At that level, you pretty much have to kick them out of the company. I have done that. I love disagreement. You let everybody be heard in a respectful way, then agree on the course. We can't be so proud that we don't do a midcourse correction.
WSJ: Describe a mistake that you fixed midstream.
Tucci: We recognized the importance of storage duplication, a technology that searches for redundant data and stores it just once. We built some of our own technology. But we then realized this company called Data Domain did it better. Engineers building our product were around a table. I said, "Data Domain is ahead of us today. How long is it going to take to catch up?" Everyone agreed it would take us more time than originally thought. We bought the company in 2009, and gained valuable time to market.
WSJ: How did you handle RSA's security breach?
Tucci: One of the things we did right away was tell customers exactly what they needed to do to protect their information assets.
WSJ: How many customers did you lose?
Tucci: Less than 10. And in 2011, we gained 1,400 new customers. While obviously nobody was happy with the breach, our customers felt we handled it right.
WSJ: How will you retain key players with an eye on your job?
Tucci: I agreed to stay a bit longer not because the board asked me. Much more important was the fact my team asked.It shows our senior leaders are confident in their ability to lead. I told them, "You will be fine without me." But I am having fun and learning every day.
WSJ: What if the insider considered your best possible successor is offered a CEO spot elsewhere?
Tucci: I would give that executive the mantle rather than lose the individual.
WSJ: You've spent $14.5 billion acquiring more than 70 companies since 2001. They include software maker VMWare, bought for $635 million in 2004.
Tucci: It certainly was the most successful. It is worth $44.18 billion today. We own 80%. Takeovers are like a string of pearls. By stringing a bunch of pearls together, maybe you are making a necklace worth a lot of money. Any of those pearls also can grow and become huge themselves.
WSJ: Will most future takeover targets still be U.S. based?
Tucci: There are pearls all over the world. Fortunately for the U.S., we have the biggest sea of pearls.
WSJ: Should EMC become more of a one-stop shop for IT needs like International Business Machines and Hewlett-Packard?
Tucci: I don't know a single chief information officer who wants to buy everything from one company. The soul of EMC will be technology. We will have distinctive products. We are not trying to be all things to all people.
This story first appeared on WSJ.com