Information Processing

Word Processing

Will the boss go electronic, too?

Business Week

May 11, 1981

Technology is rapidly filling in the final pieces of "the office of the future," the ultimate system that wires together office workers in an electronic grid and moves such paper communications as letters, memos, and reports into an electronic world where workers type information for one another's use on terminal screens.

Like the move to the automated factory, these revolutionary changes are being driven by the increasingly urgent need to improve worker productivity. So far, however, the primary thrust in office automation products has been aimed at secretarial and clerical staffs. But now the time has come for perhaps the most significant, and riskiest, product push of all -- the specialized terminal, or work station, for professionals and managers.

"The focus on secretaries just hasn't made any sense," complains Frank A. Petro, a vice- president of Arthur D. Little Inc. "The real benefit from office automation will be in making executives and professionals more productive." Indeed, the annual payroll for managers and professionals is now running $600 billion, double that for clerical workers.

Ready customers?

The absence of an executive work station on the market does not stem from any lack of thinking by the office equipment makers. Many companies have been working on executive terminals for years, but no one was sure exactly what they should do. In fact, no one was really sure what part of a manager's job could materially benefit from automation. CPT Corp., a successful Eden Prairie (Minn.) manufacturer of word processors, has been trying for three years to decide on what features to build into the executive work station it is developing. On top of that, many experts were -- and still are -- convinced that most executives would reject any office equipment that would require them to operate a complex piece of hardware and type on a keyboard.

But now it appears that two of the biggest names in office equipment -- International Business Machines Corp. and Xerox Corp. -- believe that the customer, the technology, and the market are ready for the executive work station. While most analysts are still not sure just how fast such products will catch on, they believe that the long-term potential for such a work station is far greater than it is for word processing equipment. That is saying quite a bit. About $1 billion worth of word processors will be sold this year, and shipments are expected to jump to $4 billion annually by 1985. "This year the professional products will surface but not make waves," says Amy Wohl, president of Advanced Office Concepts Corp., a Bala Cynwyd (Pa.) consulting firm. But, she predicts, "by 1985, 10% to 15% of all managers and professionals will have work stations."

IBM moved somewhat timidly in this direction recently by quietly introducing a new software package specifically aimed at modifying one of its computer terminals for the personal use of office professionals.

Saving time

There was nothing timid, though, about the Xerox entry. A splashy Manhattan press conference on Apr. 27 unveiled its long-expected work station for professionals, the 8010 Star, which Xerox claims not only reduces a professional's dependence on clerical help but can also save time for a busy executive -- up to an hour each day. The new work station has been in development for more than seven years. An earlier version, the experimental Alto terminal, was installed in the White House in 1978 to help answer such crucial questions as: How much detailed information is really needed by executives and at what management levels (BW -- Oct. 2, 1978)?

While such questions generally are still a subject of intense debate, Xerox has decided -- and most equipment makers now agree -- that a work station should provide executives both text- and data-processing capabilities, quick access to information at the touch of a button, electronic mail, calendar management, electronic filing, and the ability to create graphics and to access a company's many data banks.

One lesson Xerox apparently has learned well is that any executive work station has to be simple to operate, a vital necessity since most managers will be too busy to learn programming and complex operating procedures. The Star, according to early users, is astonishingly simple to use. It packs all of its features into a desk-top terminal that is as easy to operate as a coin-operated video game. By using Xerox's Ethernet, a local network for connecting the new breed of office equipment, Star can quickly communicate with other work stations, laser-driven printers, electronic files, and large central data-processing systems.

Of mice and men

Professionals can begin to operate Star in 20 minutes and be fully proficient in four hours, claims David E. Liddle, a vice- president at Xerox's Office Products Div. That would be a significant improvement over the months that experts say it takes to master fully a word processor. Xerox studies at company facilities showed that a Star prototype used by its patent attorneys saved each of them an average of 63 minutes a day.

Industry experts who have worked on the Star terminal seem almost as enthusiastic as Liddle. "Once people have been exposed to Star, they won't be satisfied with the old way of doing things," says Jonathan W. Seybold, editor of The Seybold Report on Word Processing. Daniel J. Drageset, program manager for office automation at Atlantic Richfield Co., agrees. "This will change the way people relate to computers. Its impressive human engineering makes this definitely the direction of the future," he says.

Early users say that they find Star "almost seductive" to operate because they can initiate almost all of its functions by simply moving a pointer, or cursor, to the right spot on the screen and then hitting one of the four command keys. The pointer on the screen is controlled by a small desk-top device located next to the terminal called a "mouse" that is similar to a joy-stick. The manager controls the pointer on the screen by moving the mouse in the same direction as he wants to move the pointer: As the mouse is moved to the left, the pointer moves left on the screen.

High price tags

In addition, Xerox makes it even easier by employing pictorial symbols of typical office functions on the screen. For example, a professional can use the mouse to point to a miniature file folder on the screen, then move the folder to a miniature file cabinet, out-basket, or printer. By pressing the appropriate command key, he can file, mail, or copy the document -- all without leaving his desk. He can also call up information from files, write, edit, and format a report, insert his own graphics, distribute drafts electronically for review, and then instantaneously print the report.

A professional can also use Star to make standard bar and pie charts from data and to create sketches and drawings by using the mouse to manipulate and alter the size of squares, rectangles, dotted lines, and other graphic aids displayed on the screen. Later on, Xerox will also offer a laser scanner to reproduce photographs, documents, or signatures on the work station's screen. "You can find most features individually on other machines, but you can't find anything that puts them all together like this," declares Bennett E. Wiseman, a word processing analyst at Dataquest Inc., a Cupertino (Calif.) market research company.

That may be true, but it also leads to one problem with Star that has been brought up by several industry experts: The $16,595 price tag is too high. "It's expensive, and we are trying to see if you need all of its functions for the knowledge workers have," says Arco's Drageset. Xerox believes that for all the performance that Star offers, the price is low. But the company was so worried about market acceptance at this price that it conducted 200 private product- screenings before deciding to go ahead.

Because of the high price tags that such sophisticated products currently require, other companies introducing work stations are labeling their products executive work stations in order to hit the high end of the market. Two recent startup companies, Convergent Technologies and Apollo Computer Inc., are selling minicomputer-based units to original equipment manufacturers for use as executive work stations. And a half-dozen other companies, including Monroe Calculator Div. of Litton Industries, Execucom Systems, and Grid Systems, are working on similar models of their own.

Puzzle pieces

IBM's new software, called PROFS, leases for $350 a month and is aimed at secretaries, as well as at principals and support personnel. "It's a considerable step beyond the word processors they've had, but it is not their ultimate answer for professional work stations," says Harvey L. Poppel, senior vice-president of Booz, Allen & Hamilton Inc., the New York consultant. Some industry experts believe that IBM has already done enough development work to introduce a strong competitor to the Xerox Star next year if the market justifies it.

The telecommunications equipment makers are also zeroing in on this new market, and such companies as Harris Corp. and Northern Telecom Inc. are preparing to announce executive work stations that are built around an office telephone and operate through a private branch exchange. The first of this group that is expected to reach the market- place will be Excalibur Technologies Corp. In June, the one-year-old Albuquerque (N.M.) company will launch Powerstation, a free-standing microcomputer with a built-in telephone, all encased in a wood-grain cabinet resembling a rolltop desk. The product, which will sell for less than Star does, plugs directly into a standard telephone outlet and features dual video display screens, one to prompt the user and one to display information. When an executive slides a removable cartridge into any Powerstation, the machine is automatically reprogrammed for that user's personal selection of operating procedures and data bases.

The market is still too embryonic for anyone to get a handle on what specific product approach will dominate, particularly since most of the major computer makers have yet to reveal their plans. Industry analysts warn also that it may take several years for the industry to overcome what they describe as a cultural resistance to doing anything about professional productivity. A.T. Kearney Inc., a management consulting firm, says that fewer than 5% of the companies it has surveyed are currently trying to boost managerial productivity.

"Professional productivity gains are a hard number for people to see," acknowledges Petro of Arthur D. Little, "but the smarter companies will soon begin to realize the productivity gains do exist and will implement office automation systems containing [executive] work stations." While the list of companies in the market is growing, industry observers familiar with the Star work station say that it will be a formidable competitor for three reasons -- its ease of operation, Xerox's reputation for office products, and the company's Ethernet local network. "Nobody has a clear shot," says Dataquest's Wiseman, "but people with networking products [such as Xerox] have the advantage because they can tie together a lot of different pieces of the puzzle." 

GRAPHIC: Picture, Xerox's 8010 Star is aimed at the busy executive who needs a simple system for his own office.

Copyright 1981 McGraw-Hill, Inc.