Out of the Blue: Perspectives on the IBM midrange

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I'd love to meet the person who thought it up. Rightsizing. As a masterful bit of incentive marketing, it ranks right up there with light beer and ecotourism. In an industry that practices the alchemy of price/performance, where the transmuting power of innovation routinely turns less into more, "rightsizing" evolved to combat that pesky national trend toward downsizing.

Rightsizing does what classic marketing ploys, according to writer David Shenik, are designed to do: "It identifies customer anxieties and pounces on them." Even before you know exactly what rightsizing is, you can be pretty damn sure that whatever size you are, it's the wrong size. And just when you're almost out of your mind with worry over being wrongsized, IBM offers you what Shenik calls "an easy-purchasable way to ease the discomfort."

So, if rising IS costs are adding to your discomfort, the Application Business Systems (ABS) folks at IBM would like to introduce you to the rightsizing rage. To start, they recently sponsored the AS/400 Rightsizing Implementation Forum at their not-so-modest Park Tower digs in Manhattan. Since you couldn't make it, they invited me instead.

The Rightsizing Forum consists of the testimony of four IBM customers: Communications Data Services, Inc. (an Iowa-based company that operates subscriptions databases for the nation's top publishers); Color Tile, Inc. (with 800 retail stores that offer covering for your naked floors and counters); Henkel Corporation (which distributes industrial chemicals to almost every industrial sector in the nation); and Sunkist Growers, Inc. (the world's largest citrus marketing cooperative).

Their stories are similar and go something like this. The company's IS footprint decisions were made more than a decade ago. System costs were running high relative to the value and functionality that was provided the corporation. The IS budget was operations and maintenance heavy, especially weighted by labor costs associated with applications maintenance. Most IS environments were mainframe-based and the companies wanted to reduce overall costs while speeding up the delivery of new, distributed applications.

In large part, each company wanted to adopt a different focus: from mainframe efficiency to an emphasis on functionality; from reliance on specialized skills to a premium on business skills; from accessing information through a technical staff to giving users direct access to their data; from programming by committee to the use of query languages.

Here's where rightsizing comes in. Perhaps the best definition was offered by Bill Freitas, director of Computer Task Group, a consulting firm that participated in the forum. Freitas noted: Rightsizing has more to do with "aligning technology to solve a customer's business problems" than with any magic-bullet solution. And that, as they used to say in the "Leftsized" '60s, is Right-On.

Since the AS/400 with its high-end capacities and capabilities is, for all practical purposes, a user-friendly mainframe, it plays well with the oversized-and-underfunctional crowd.

Ironically for IBM, there is both good and bad news in that. Three-fourths of the customers who testified at the forum were abandoning their ponderous IBM mainframes in favor of the nimble AS/400s. So while IBM retained a "rightsized" customer, it did so for substantially less revenue than it would have received from a mainframe user. Color Tile, for example, reported a five- year savings of $5.5 million migrating from an IBM 3090 to an AS/400. Software maintenance savings alone totalled $36,000 per year.

(Halfway through the presentation I began to wonder if perhaps, two floors up, the Enterprise System mainframe folks-clearly on the short end of the rightsizing stick-were not holding their own forum on the benefits of "upsizing.")

Several firms reported savings in reduced headcount. Sunkist pared down its IS staff from 93 to 48. But Henkel Corp. actually expanded its staff by 400 percent. The additional personnel, however, were able to focus on providing improved customer service, rather than servicing the system. One of the more curious benefits of rightsizing was rescuing Color Tile from almost certain entombment in reels of magnetic tape. Before the AS/400, their operations personnel were chained to the tape drives, executing in excess of 12,000 tape mounts per month!

Many of the benefits that AS/400 users have come to take for granted were cited as rightsizing incentives: relational processing, less training, easier programming, improved information access, the ability to briskly accommodate change, and the availability of more than 20,000 software packages.

Then, too, the AS/400's ability to play on the leading edge of technological innovation was an attractive inducement to rightsize. Office automation, multimedia, image, voice-data or telephony, facsimile, and even artificial intelligence. In short, the impression emerging from the forum was that only the most obtuse corporations would find excuses not to rush into rightsizing.

Of course, the efficacy of the AS/400 is not at issue here. It is an honest system capable of meeting its advertised claims. It's that silly word: "rightsizing." As beneficial as it can be to customers who have not upgraded their technology in some time, rightsizing has an amusingly manipulative ring. Like my mother said as she smiled from behind a big spoon of foul-tasting medicine: "It's gonna do you some good, but you gotta swallow it first."

If I squint, rightsizing looks suspiciously like downsizing made profitable. Essentially, rightsizing combines the allure and benefits of downsizing (less cost, less people, less complexity), with a generous dash of functionality thrown in. And it is aimed primarily-though not exclusively-at salvaging mainframe customers. From mainframe to saneframe, with less cash drain. (Do I belong in marketing, or what?)

After the presentations have concluded, we are urged to interview participants and a number of available IBMers. I opt for William Zeitler, ABS director of Brand Marketing (worldwide). Zeitler seems a very intelligent and thoughtful man who, I am sure, could have provided me with a great interview. But it's a curious process interviewing top management at IBM. For one thing, you can't ever get them alone. They interview in packs. Two other people sat in on my interview, serving no discernible purpose but taking copious notes and looking intensely interested. It sort of stifles the natural flow of things.

I leave to catch a cab back to the airport. I sit with the windows open, the hot, stagnant air stinging my eyes, and think back to something William Zeitler told me. I had asked him what he thought of Louis Gerstner's appointment as the new head of IBM. He told me Gerstner was a breath of fresh air. In New York, that's no small accomplishment.

Victor Rozek has 17 years of experience in the data processing industry, including seven years with IBM in Operations Management and Systems Engineering.



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