The Silicon Jungle

by David H. Rothman

Alan Scharf: Integrated Program, Including Graphics

Alan Scharf, a forty-three-year-old New York executive, also has a nice touch with software—a good-enough one, in fact, to have helped win him a job at a blue-chip firm at triple his old salary.

“It’s done wonders for my earning power,” he said from his offices at Merrill Lynch Leasing, Inc., where he was a $75,000-a-year assistant vice-president. “I got this job because I walked in and told them I could do a better job on an Apple.

“I didn’t own one at home at the time. But you can be sure that I bought one promptly and boned up on it for the next three weeks, and of course I’d done a lot of research on the Apple before then to make sure I could deliver on my promise.

“My previous company had refused to let me get one to improve operations there and do estate taxes. I had to do them by hand on a calculator. It took hours per client. And I got mad. Most people my age are afraid of computers, but I’d worked with word processors. And what are word processors but another kind of computer?”

So Scharf left his job as an estate tax planner with a staid old brokerage firm and set up shop at Merrill Lynch’s division dealing with real estate and equipment leasing.

It was a VisiCalc devotee’s dream job, one calling for quick, repetitive, accurate math in deals as big as $150 million. Merrill Lynch Leasing made bids to companies hungry for better cash flow. The leasing company (and rivals) offered to buy their headquarters buildings or other real estate, freeing the money for bigger factories or research and development. It was a series of leaseback arrangements. Merrill Lynch organized syndicates for the ultimate buyers—people or companies eager for tax shelters. And that meant more than a little numbers crunching.

Imagine the variables. The deals had to be sexy enough to the selling companies for Merrill Lynch to win the bids. At the same time, the tax shelters couldn’t leak. The deals must provide the buyers with the write-offs that the prospectuses from the leasing company promised. Ideally, too, they would yield maximum tax advantages on minimum investments. And for investments of different sizes and at different tax rates, just what would the various benefits be?

When Scharf reported for work, he found that the real estate department of the leasing company was on the verge of spending $200,000 a year tapping into an outside firm’s computer to come up with the right numbers. The big machine would have been able to do simple debt-amortization calculations. Scharf could have told a company, for instance, how long it would take to pay off a mortgage on a building for which Merrill Lynch proposed a leaseback. But that was only a small part of what the job needed. And what about the costs?

So Scharf instead used an Apple system costing less than $7,000, a one-time investment. The Apple couldn’t do all the calculations needed, but it could actually outperform the time-sharing system in some ways.

Consider simultaneous equations. The software on big machines—at least by way of the terminals at Merrill Lynch Leasing—just didn’t include them. But the Apple could simulate this capability. With the VisiCalc spreadsheet it could juggle around dozens of interrelated statistics, using nightmarishly elaborate algebra with Catch-22-like mathematical spirals. In other words, you wanted to know the value of x, and it depended on the value of y and z, and you couldn’t solve for y until you solved z, and you couldn’t solve for z until you knew x. That’s how it worked, except, quite possibly, Scharf and his staff would be wrestling with, say, a through k instead of just x through z.

Struggling with these Catch-22s, the Apple was a slowpoke by computer standards. It still took half an hour. That might seem like the Indy 500 to someone accustomed to hand calculations. But Scharf must have felt the same way I did about inferior word-processing software. However faster than without a computer, it still limited your possibilities. You didn’t have as much time to experiment with all your choices. And the more time Scharf had, the more closely he could consider all the variables and the more attractive could be Merrill Lynch’s leaseback bids. The Apple did its job. “We used it to compete successfully for work with a number of well-known clients,” Scharf said. “Anheuser Busch—we did their office building in St. Louis. We worked with Beneficial Corporation. We’ve done a number of K mart stores.”

Scharf, never smug, still tinkered with the Apple and its software. An observant computer dealer noticed he would keep asking for larger RAM boards to allow him to do bigger, fancier spreadsheets.

And so it was that the dealer nominated Scharf a tester for Lotus 1-2-3 in late summer 1982. 1-2-3 was the new integrated software from Lotus Development Corporation, a Massachusetts firm started by a former rock disk jockey rich with $500,000 in royalties from programs sold to the makers of VisiCalc.

1-2-3 combined a spreadsheet, graphics, and data base. You could, for instance, pump figures from the spreadsheet program directly into the data base with a few simple keystrokes. You didn’t have to go through unwieldy[unwieldy] computer rigamarole to transfer facts from one kind of electronic file to another. More important, however, Lotus, at least for Scharf’s use, was a more powerful numbers cruncher than the VisiCalc he ran on his Apple. Lotus was for the 16-bit IBM PC. Sixteen-bit machines were speed demons for numbers crunchers, especially with powerful programs like 1-2-3. An Apple-VisiCalc duo handled worksheets with 254 rows and about 65 columns. But an IBM and 1-2-3 duo could take on 2,048 rows and 256 columns.

Scharf’s first test version of 1-2-3 cracked simultaneous equations in four minutes, one-tenth the time that the Apple-VisiCalc combination took. Income and cash-flow statements came out calculated to the nearest penny.

■ ■ ■

Alan Scharf’s Tips on Choosing the Right Spreadsheet

Not every spreadsheet user has needs as complex as those of Alan Scharf, a whiz with Lotus 1-2-3 and Symphony, but here are traits he says you might look for:

1. A large number of rows and columns. A spreadsheet of 254 rows and 65 columns doesn’t mean you can work with 254 rows and 65 columns containing a total of 16,510 cells. The actual number of cells—the number of columns multiplied by rows—will be only about a thousand. A 640K-RAM machine and an elaborate spreadsheet would be much more appropriate for budget planners in a large corporation with many products and divisions.

2. Speed. “Even with a simple spreadsheet,” says Scharf, “someone might get annoyed if it seemed to drag.” In late 1984 his complex calculations on an IBM PC were taking as much as four and one-half minutes. And he said: “There are times when I just need the answers faster.” The powerful IBM AT could run the present version of Lotus 1-2-3 twice as fast. However, he was still looking forward to the day when a version of Lotus 1-2-3 for the AT would require even less time and address the full 3 megabytes of memory (aided by a new operating system). Consult micro magazines for the latest speed comparisons.

3. General simplicity and ease of use. In tricky places, does the program offer “help” messages in plain English to guide you through various procedures if you want? Ease of use will increase as computer memories grow larger and leave more room for “help” features.

4. Range of commands. Most spreadsheets nowadays let you easily move or copy numbers. But there are less common but very useful commands. Symphony, for instance,[instance,] lets you flush out formulas behind calculated cells so you can regain available memory space.

5. The ability to do what-if tables. The best spreadsheets won’t just tell you what your profits would be if your costs increased by x amount. They’ll also let you calculate for a whole range of numbers around x, automatically creating a table.

6. Easy consolidation of figures from different spreadsheets. That’s no small matter if you’re trying to come up with a profit and loss statement for a twenty-division company. Lotus 1-2-3, unlike some rivals, lets you consolidate an unlimited number of divisions.

7. Natural order of recalculation. Cells must influence the numbers in other cells in a precise sequence if some calculations are to be accurate. Natural order of recalculation helps you automatically control that sequence.

8. A useful macro language. Macros are combinations of commands that you can program into your computer to reduce the number of keystrokes and save time. A macro language systematizes these shortcuts.

■ ■ ■

He could use 1-2-3 in the future, moreover, as a data base with up to 32 fields and up to two thousand records, and it did all[all]the basic search and sorting that you’d have in other data-base systems. At the time I talked to him, the names and addresses of investors—receiving quarterly income reports—were still stored on an Apple. Scharf was waiting for the right word processor-mailer to come along to work with the 1-2-3. Then the massive retyping job for the address lists would be worthwhile. With space for two thousand names, 1-2-3 would be much more useful than just a small filer. It wouldn’t be just a primitive record-keeping system with limited capacity.

Meanwhile, for Scharf, graphics was a snap. “If I send out a thirty-page bid, I do three or four graphs with it,” Scharf said. “We have a selling job to do with both the potential corporate leasees and the potential inventors. The presentations are complex, and the graphics come in very handy. We use line graphs and bar graphs showing the expense of lease payments versus mortgage payments if they went out and mortgaged the properties conventionally. The minimum terms of the leases are usually twenty-five years; it’s a huge numbers-crunching job, and we try to simplify everything as much as we can. I come up with the figures on the spreadsheet part of 1-2-3. Then I tell what I want on the graph. Maybe I want to make a line for the rental income, interest expense, depreciation, or taxable income. So I select the appropriate columns on the spreadsheet. Then I push ‘V’ for ‘View,’ and I can see my work instantly as a graph. If I don’t like it, I can quickly redo my calculations and look at the graph again.

“And 1-2-3 offers a tremendous range of printing options. You can specify how many rows you want per page. You can tell if you want border lines separating some numbers and titles of columns. You can tell if you want a header—can indicate the subject on each page.

“The printout can be in any one of several type styles on dot-matrix machines. Or you can use a daisy wheel with its own typewriter-style print.

“And you can do color. A colleague uses plotters.” Controlled by the IBMs and Lotus 1-2-3, ballpoint pens, with different colors, wriggle up and down. They can make bars as well as line graphs, and pies, too, among others.

Not that Lotus was the answer for everyone. Soft.letter, Jeffrey Tarter’s trade publication, noted that all integrated programs compromised in some way and were the software version of a Swiss army knife. “Swiss army knives are nifty gadgets; we’ve got several ourselves,” said Soft.letter, “but we don’t use them much. Instead, we use specialized tools for specialized tasks—screw-drivers for poking around inside the Apple, a stand-alone cork-screw for uncorking the Chablis, and a nice big carbon steel blade for carving roast beef. Each of these tools does its specific job better than the multipurpose tool.”

At least in the version available as of this writing—listing for $495—Lotus 1-2-3 didn’t have a real word processor. You could write paragraphs. But it lacked the speed of true word processors and was awkward. Nor did it offer communications software to use with a modem. Context MBA, a rival integrated program, did. But then MBA’s spreadsheet module wasn’t nearly as fierce a numbers cruncher as 1-2-3’s was.

Lotus planned to improve 1-2-3’s text-processing ability—which it did, ultimately, along with the data base, graphics, and spreadsheet capabilities of a super-1-2-3 called Symphony. The new program, unlike 1-2-3, also let you talk to other computers.

At Merrill Lynch Leasing, however, Scharf hadn’t any need to reach a mainframe for his calculations. His four IBMs with 1-2-3 were doing the work. They had cost $40,000, including extras like printers; except for service, that was it. What’s more, with four people, Scharf said, he was tackling the same work load that eight people were handling in a similar office on the equipment-leasing side of the operation.

Months later I reached Scharf to find out if his career was still in ascent. “I’m now a vice-president,” he said. His salary had broken the six-figure barrier, and he was hoping for a still more lucrative job there or with another firm.

It was a good fit, Scharf and his software. He had the best program for him. “Most people would rather talk about hardware,” he said. “I know hardware, but I’d rather discuss software.” He had a point. Especially now, when there are so many clones of various IBM micros, you’ll find that good software will give you an edge on your competition.

You can also gain an advantage by experimenting with new types of programs. The next chapter discusses graphics, which, after many years, is at last becoming practical for owners of inexpensive micros.

Backups:

◼ [V], “3-D” Versus Mail-Order Software—and How to Shop, page [319].

◼ [VI], “Easy” Data Bases: Another View (Mensa Member Versus InfoStar), page [323].

7

Graphics (or How a Mouse Helped Joe Shelton’s Friends Stop Feeling Like Rats)

When a California executive invited people to his apartment, they often ended up feeling like rats in a laboratory maze.

“I had people driving around for half an hour and find a phone and say, ‘Come on over and get me,’” says Joe Shelton.

In recent years, however, the “hit rate” for finding Joe’s place has jumped from 50 percent to over 95, and computer graphics is the reason.

Joe’s neat little map shows a mile-square area with up to five turns before you even start wending your way through the complex of 150 units. He isn’t an artist. But he uses a Macintosh computer.

With the Mac’s famous “mouse”—the pointer device that Joe rolls along his desk to move the cursor—he can effortlessly make sketches.

Granted, Joe isn’t detached about Mac’s virtues, not as a $50,000-a-year software products manager with Apple Computer! And this particular example is trivial. It’s also, however, irresistible. And the story indeed shows how graphics can ease the life of a corporate manager. People also use computer-drawn maps for, say, directing colleagues to meetings in new places.

The easier-to-use graphics programs—like MacPaint—are to art what word processing is to writing. They won’t turn you into Picasso. But they’ll make your sketches and designs look less like your kindergartner’s.

“But I can’t even draw a straight line,” you protest.

Well, Mac-style graphics programs will help you electronically pick a line out. Or a circle. Or a rectangle. You also, of course, can control the sizes and locations of the shapes you select. And you can choose shading. And vary its intensity. And you can also use exotic type styles and even design your own type.

By letting you zap mistakes, without messy erasures, computer graphics may eventually halve the time it takes for you to do a complicated drawing.

Directions: Turn onto Cary Avenue. Follow Cary[Cary] around left and then right bends for at least .3 mile from Washington St and turn into apartment entrance on right. Make immediate left turn and continue until you cross speed bump. Park in any uncovered space on left. Apartment 4 is upstairs in the middle on the other side of the building.

Would you feel like rat in a maze if you had a map like this to guide
you to Apple executive Joe Shelton’s house? Indeed you would. Lest
anyone mistake Joe for Customer Support, the map doesn’t contain
his actual address.

Of course there’ll always be resistance to graphics from some hard-core bureaucrats in and out of government.

“The Macintosh,” gripes one, “takes us back to the time people were drawing pictures on cave walls.”

He’ll tolerate some graphics but loves to read and write twenty-page memos.

And if I were an executive, I myself would growl if my people insisted on Macs just so they could use Old English characters for routine paperwork. In fact, for that, I’d rather work with a Kaypro or a mouseless IBM PC.

“For the world of letters and numbers a computer without a mouse would be better,” says James Fallows, the Atlantic Monthly’s Washington editor, who tried a Mac for several weeks but happily returned to a machine with WordStar. He and I are baffled. We can’t understand the Mac’s lack of cursor keys. Why couldn’t Apple have kindly let Mac users move the cursor conventionally on the screen if they wanted? Omitting the cursor keys was IBM-style arrogance, no ifs or buts. Even if cursor keys become available on a numbers pad, it won’t be the same as having them in a convenient location on the main keyboard.

But graphics? That’s where the Mac and similar machines may pay off for people with overscheduled art departments or an honest willingness to experiment:

● A California designer can draw a hot-water system for an outdoor car wash in just four hours, thanks to his Mac; once it took him days.

● A Washington state man uses his Macintosh to design optimal orchard layouts.

● Another user lays out the Yellow Pages with his Macintosh, while still another employs one to plan paintings.[^[29]]

Advertising agencies, especially, may benefit from computer graphics even if the Mac-priced technology still has some flaws. Take one example. Just after a Colorado agency bought a Mac, a bank wanted an ad saying that it gave personal service—that its customers were more than computer numbers. But how to get the idea on paper?

“I suggested that the bank use a computer for the ad,” said Rebecca Glesener, assistant art director of Heisley Design and Advertising, a twenty-five-person agency in Colorado Springs. The bank agreed.

Using a Macintosh, a Heisley artist drew a man and woman with masses of numbers on their faces.

“If your bank sees you this way,” the ad said, “come see us.”

Western National Banks loved the results. And when I talked to Glesener, her agency was about to unleash another Mac-drawn ad—the machine’s “self-portrait”—for an Apple dealer.

“We have several clients in the computer business,” Glesener said, “and we thought we should be aware of computers.”

Of course you don’t start instantly doing first-class graphics work on Mac-like machines. Take the man drawing the Western ad. He had “no computer skills” in his background, and he toyed around with the Mac for some six hours or so before he did the numbers heads for the bank.

With the art stashed away on computer disks, though, the Heisley agency could more easily crank out different versions of the same drawing.

It’s like word processing. Once you’ve stored your material on your computer disk, you needn’t start over from step one.

Mac-like machines may also streamline ad agencies’ mock-up work. Through the marvels of graphics an art director can more easily figure out the best location for Brooke Shields’s derriere in a jeans layout.

In fact, the Heisley people said they had used Mac successfully on drafts of a sales brochure and an ad for the U.S. Amateur Hockey Association.

Even so, Don Pierce, the artist behind the bank ad, warns: “Inexpensive machines like the Mac can’t come up with drawings good enough for final ads without a deliberate computer effect. A line other than a forty-five-degree line can be pretty ragged because the machine makes them in steps.” And they lack a good-enough resolution to downplay the roughness.

Eventually, of course—through high-quality graphics made on laser printers—cheap machines may turn out slick ads that don’t scream, “A computer made me!”

Meanwhile, Mac-like computers will do fine for drafts and nonpublished work. Already, when hooked up right to some Compugraphic typesetting machinery, Mac’s sister computer Lisa II can turn out seamless charts for publication.

Who else might use computer graphics? Some examples: