Boiled to its essentials, the job of a corporate chairman consists of acquiring, sifting and evaluating enormous volumes of information. Yet ever since computers were invented to help with such functions, America's top managers have resisted making personal use of them, clinging instead to such traditional tools as pen and scratch pad.
Today, a new class of software is finally helping computers seize space on the desks of CEOs. The systems remain costly, rare and in some cases controversial. But many analysts feel they are finally coming of age.The latest development came this week, when International Business Machines Corp. introduced new office automation products that will smooth the way for this technology, known in the industry as executive information systems (EIS).
Interest by IBM in an infant technology is often taken by the market as proof that it will fly.
At Phillips Petroleum Co. in Bartlesville, Okla., it already is. Senior managers there flip on desk-top computers for information on everything from crude-oil sales and personnel files to availability of the corporate plane. They can do the same from home. In the old days, information might take hours or days to arrive, said Ray Steiner, vice president for supply and transportation. "Now I get it in 15 seconds," he said.
Phillips swears by its system, but not everyone who has gone this route is equally enthused. For instance, the National Oceanic and Atmospheric Administration spent $500,000 setting up an advanced system that gives 17 top officials data on such things as procurement, personnel and congressional relations.
"The technical part of the system has performed," said Robert Swisher, chief of the agency's systems-development branch. "But I don't think the system has yet met a real business need that solves problems at the management level."
He suggested that more work is needed on what the agency hopes to accomplish with the system.
This is the common challenge with EIS. Graphics and computing speed have advanced to the point that the systems are easy and in many cases fun to use. Yet they can only be as good as the information going into them and as the people who filter and present the information.
For all the interest it is causing, EIS is not the only computer technology penetrating the executive suite. Wang Laboratories Inc. and other computer firms are working to adapt managers' love of pencil and legal pad to the new age, introducing products that allow them to use an electronic pen to write in longhand or sketch on a screen.
International Data Corp., a research firm based in Framingham, Mass., estimates that last year U.S. companies sold EIS software worth about $100 million, and it sees sales growing fast, to about $230 million in 1992.
The market is bigger than that, however, because additional funds are spent implementing the software and many companies, such as Phillips, choose to write their own in-house. EIS is new enough so that companies that buy the software often insist on seeing it up and running on their own equipment before they pay.
"There's a fair amount of tire-kicking," said Richard Crandall, president of Comshare, the largest company in the field. He estimated that only 5 percent of his clients later drop the systems.
Information of the type the systems display has been stored in company and agency computers for years for use by middle-level managers and low-level employees.
The challenge has always been how to get it out of these often technically incompatible data banks and to the top executive, quickly and in simple, understandable form. And it must be done without breaking the bank.
The systems began arising in the mainframe era of the 1950s and '60s. Twenty years ago, for instance, aerospace manufacturer Boeing Co. was running one to keep track of contracts.
But in general, early versions were costly, the software was unwieldy and the top-level people who were supposed to use and swear by it were unwilling to take the plunge.
The mid-'80s advent of screen graphics, popularized by the Macintosh family of Apple Computer Inc., helped simplify usage. Now there were no keyboard commands to memorize. Suddenly, CEOs could simply use a "mouse" pointing device or simply touch the screen to put the computer to work on whether one division had an unusually high absentee rate or another had finally met its productivity goals.
Perhaps the hardest part of setting up a successful system is deciding what type of information should go into it and making sure that, day after day, it is put in on schedule.
Some experts focus on using the system to analyze internal information about a company's performance.
Others, such as Herbert E. Meyer, a former CIA official who now heads a Washington company called Real-World Intelligence Inc., argue that major gains can be made by using the computers to analyze information about the outside world as part of "business intelligence" systems.
Assuming the systems function, many offices find that they help focus institutional energy by setting up goals that everyone sees and can measure progress toward on a day-to-day basis. Said Alan Paller, president of AUI Data Graphics, a division of Computer Associates Inc. of Chicago: "An EIS is a wonderful broadcasting system that says, `These are the things that the boss is watching. We'd better make it happen.' "
"Unless it's very well thought out, the scale will bury the critical information and the executive won't have the time to look for it," McAuliffe said.
To avoid that, a good system will do as much of the sorting and filtering itself as possible, he said.