OpenText Corp.’s choice of a Silicon Valley star as its new CEO is “tremendously significant” for Canada and Waterloo Region, as well as for the country’s largest software company, Communitech CEO Iain Klugman says.

Klugman was reacting to news that Mark Barrenechea, 46, will succeed John Shackleton, 64, when he retires Jan. 2, after 13 years of strong and steady growth at the Waterloo enterprise content management giant.

“As one of Silicon Valley’s most skillful executives, Mark could have chosen to work and live anywhere,” Klugman said. “His choice of OpenText and Waterloo Region speaks to the world-class quality of our companies and our community.”

Barrenechea is a seasoned tech executive who held high-level positions at Tesseract, Scopus, Oracle Corp. (where he led several thousand employees globally) and CA Technologies (formerly Computer Associates), before he led the acquisition and turnaround of bankrupt Silicon Graphics International Corp. in 2009, as CEO of Rackable Systems Inc.

Rackable Systems adopted SGI’s name and brought in revenues of $629.6 million in its most recent fiscal year, a turnaround that earned Barrenechea the title of 2011 Best CEO of a large tech company from the San Francisco Business Times.

At OpenText, he will take on an operation with 4,400 employees worldwide and revenues north of $1 billion, a figure that grew tenfold under Shackleton’s guidance. Only IBM has a larger footprint in the enterprise content management sector.

Brett Shellhammer, a Communitech entrepreneur-in-residence and former OpenText executive with 16 years of Silicon Valley experience, said he was “giddy” when he learned of Barrenechea’s appointment in news reports.

“I couldn’t stop telling my wife how awesome a move that was for OpenText,” Shellhammer said. “It’s the best possible hire they could have made for a CEO; there’s been talk about John (Shackleton) retiring for quite some time and wanting to get the right successor, and I think they really hit it out of the park.”

Barrenechea is known as “one of the top enterprise software executives in the world, and certainly in Silicon Valley,” Shellhammer said, adding that his personality is similar to Shackleton’s, which bodes well for the OpenText executive team he will soon lead.

Shellhammer was working at Oracle when he met Barrenechea, who was still at Scopus, “about 100 years ago,” or in tech years, around 1995-96. (Scopus was purchased by Siebel in 1998, and Oracle bought Siebel in 2005.)

“We were trying to do a partnership with them, and I remember specifically walking out of that meeting and saying, ‘He was the smartest guy in the room,’ and a really nice guy,” Shellhammer said.

He echoed Klugman in saying Barrenechea’s impending move to Waterloo Region speaks volumes about its increasing stature as a global technology hub.

“For us to be able to attract a guy of that calibre to come and live in Waterloo Region, I think it really says we’ve crossed a critical milestone in terms of the region as a tech centre,” Shellhammer said, “and culturally, as a place to live for executives of public companies.”

The welcome Barrenechea receives from the region’s tech community will be important in bolstering that message, Shellhammer added.

“The people he knows and the friends he has back in Silicon Valley will watch closely how he transitions to this community,” he said. “That’s something where we really have an opportunity to show the world, and especially the folks in Silicon Valley, that this is a place where they can come and not only succeed, but thrive in a way that they didn't expect.”

Himself a Valley veteran who moved to Waterloo Region for OpenText six years ago, Shellhammer said he expects Barrenechea will be pleasantly surprised at the quality of life in the region.