Business revolutionary

Technology changes so quickly, the old joke goes, that as soon as the computer hits the store shelves, it’s obsolete. While that may be frustrating for the average consumer, it’s not exactly easy for the businesses that manufacture the complicated parts populating your PC’s innards, either.

"One thing never that changes is that you have to change," says Subramonian Shankar, president and CEO of American Megatrends Inc. "That means I find that, as a company, we have to keep reinventing ourselves as technology changes, and not only the technology, but also the business conditions."

American Megatrends makes a habit of reinventing itself as it tries to stay ahead of the ever-evolving world of technology. A casual read of articles and press releases about AMI reveals how its core expertise changes every few years. At various times in its existence, it has focused on motherboard design, BIOS and RAID Controllers. AMI’s next venture is storage.

But it was the motherboard design, and another then-small-business man, that nearly put AMI on the map. A 1985 technology conference brought Shankar together with Michael Dell, who at the time was interested in Intel’s new 386 chip. The meeting led to a contract, and AMI spent seven months working on a 386 motherboard design for Dell Computer, then known as PCs Ltd.

"At that time, he didn’t have any engineers in the company," Shankar says of Dell. "He had about 100 employees; he was a $40 million, $50 million company. He was just low-balling pricing.

"Michael is not an easy person to work with — extremely difficult. During the seven months I worked on the project, Michael was very, very close to me. I was probably the first engineer inside Dell."

But the deal that might have sent AMI into the stratosphere was not to be. Another consultant was working on a 286 motherboard product for Dell at the same time.

"That consultant somehow managed to convince Michael that PCs Ltd. should not be the first company with a 386 product. So even though we finished designing the 386, Michael did not announce the 386 motherboard."

And although Dell cancelled AMI’s contract when he decided not to be the first to introduce the 386 computer, he appreciated Shankar’s work.

"At the end of the project, Michael wanted to hire me and have me join his company, which I didn’t want to do because I had started a design company. I wanted to see it through. I said, ‘Michael, no. That’s not why I came to Austin. I want to continue to do design work.’"

Smart Business Atlanta spoke with Shankar to learn how he keeps his operation on the cutting edge.

Did you ever regret not going to work for Michael Dell?

Absolutely not. It was quite a challenge to build up a business. AMI hasn’t taken money from anybody. There’s no outside investor, no line of credit, nothing.

We bootstrapped ourselves and fronted the company with the money the company has earned. It has been a challenge, but it’s also been extremely exciting. It has always kept me on my toes.

And I don’t think that, working for Michael, I would ever have been able to enjoy the work as much as I did working for AMI and building it up. When you do things on your own, there’s a certain charm to it.

How do you decide where the focus of your company will be?

(We listen to) what industry pundits have to say, what we hear at conferences, what we read in the trade publications. There are a variety of things that we come across.

Then, of course, we have to match it with the expertise that is available in the company. Normally, we have to make sure as we change directions, we change into a product area where we can take our existing engineering team and they are able to relate to this new technology.

If you take storage, in some ways it’s related to what we were doing previously, which was RAID. RAID manages storage, so there was some understanding of storage, even though we were not specifically doing storage products. We had storage products in the company. We interacted with customers who had storage applications, so we had some understanding of storage itself.

When we sold the RAID division, it made sense for the company itself to look at storage because storage had been part-and-parcel of the RAID business. Technology-wise, it was not too difficult or too different from what we had been doing previously. For that reason, we were able to make a move and get into storage.

How much of a challenge is it to revamp the company’s focus?

It’s not an easy process. It’s one thing for us to work on a project; it’s another thing to get a project that has some features that are unique, that are different from what the others have to offer, and, more importantly, is to make it extremely stable, extremely robust. It takes time.

With respect to storage products, this is the year where I would say AMI (will have) some products which will attract industry attention, will probably create interest in the minds of some of the major players. I think the product that we have to offer has been well-tested.

This is a robust product. It takes time — maybe a couple of years, maybe three years. It depends on the technology.

How have changes in the PC industry affected your strategy?

One of the things we noticed is, as the PC industry has matured, there is less of the standard that used to exist in the old days. In the old days, it was much easier to develop a product because the standards were very strong, and it was easy to develop one component that you can expect would work flawlessly with some other component or some other module developed by some other vendor.

That’s no longer true. Compatibility, interoperability are much more today, and that is one of the reasons I think it takes longer to get a robust product. You can get a working product, but a product that works with other products offered by other people that would seamlessly work with other companies’ products, that will take some time in terms of testing, in terms of exchange of ideas and information.

Where is AMI’s next big venture?

We hope to be the No. 1 company in terms of some area of storage. We think that we’ll be able to identify certain specialized areas in storage where we will become No. 1. We have some great ideas, some great people, some great talent.

One of the things I have learned is to never give up and to continue to try and try and try again. How to reach: American Megatrends Inc. (770) 246-8600 or www.ami.com