Tag Archives: WIP

1985-1988 TSI: GrandAd: The System/36 Conversion

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TSI’s first big conversion. Continue reading →

A fairly detailed description of the design of the GrandAd System can be found here. More information about IBM’s System/36 (S/36) is posted here.

The purchase of the GrandAd software system in early 1985 by Keiler Advertising (KA) was definitely a milestone for TSI. The agency was one of the two largest in the Hartford area, and its founder and president, Dick Keiler1, was highly respected in the local advertising community.

Although I had recommended to Sandy Procko3, KA’s finance manager and our liaison on the installation, that they buy two Datamasters and a hard drive, IBM had talked her into ordering the recently announced S/36 model 5362. They made the right decision.2 The Datamaster was on its way out, and the S/36 gave them better peripherals and room for growth. It also had many more subtle advantages.

Her decision was a great break for us. We would have needed to convert the system anyway. The sooner that we got started on it the better.

The only problem was that no one at TSI had ever worked on a System/36. We knew that the system had a BASIC interpreter, but we were uncertain about the compatibility of the two versions. IBM provided KA with a huge stack of documentation. I read the BASIC manual thoroughly and was relieved to find that it was very similar to what we were accustomed to. I read enough of the other manuals to get an idea about how to set up their system.

I also had to write the file definitions for each file. We had versions of these created in the Datamaster’s word processing program, but on the S/36 it was important that they be stored as Data Definition Specifications (DDS). The final preliminary step was to write a procedure for creating all of the empty data files from the DDS.

IBM’s office had a 5360, the “washer-dryer” model.

IBM allowed us to work on the S/36 in its downtown Hartford office before KA’s system was delivered. I saved our programs onto 8″ disks. I created a library for them on IBM’s 5360. Then I restored them as text files. I edited them to conform with the S/36 syntax and changed the names of all of the files to use the dot format that SSP required. I then tried to load them in the interpreter. If any lines were rejected, I fixed them and kept trying until the program loaded. Then I went on to the next program, of which there were several hundred.

When I was done with the programs and procedures, I saved the library onto diskettes, brought the diskettes to KA, and restored them. Then I executed the procedures to create all of the files. It never occurred to us that there might some day be a way of populating the data files from files that they had stored on their PC’s. I think that it was possible to save the specs table, which was a fixed-record-length file.

For nearly all of its forty-two years of its existence KA was located in a large house in Farmington, CT. It is portrayed in the photo at the right. During the period in which I was regularly vising the agency, the trees and the bushes were much smaller, and they were surrounded by wood chips. Sandy called Dick “the mulch king” of Farmington.

From the beginning, or shortly thereafter, Sandy was assisted by a younger woman named Shelly. I don’t remember her last name

Getting the code to work on the S/36 caused us fewer problems than one might imagine. By this time we understood how IBM thought about things. The fact that all of our programs followed strict procedures also made it easier to adjust to the differences. I don’t remember encountering any problems that necessitated consulting IBM or anyone else.

Here are my most vivid recollections of the installation.

KA’s 5224 printer was much faster than anything available on a Datamaster.
  • KA not only had a kitchen. It had a chef who prepared meals for clients and prospects and a dining room as well. I was never invited to one of these occasions.
  • The parking lot at KA, which was in the back of the house, had a few narrow grass covered areas with skinny trees in them. I parked my Celica to the left of one of them once. When I exited I turned the wheel too soon. The mirror on the right side of the car got caught on the tree and broke off. Thenceforward there was no mirror on the Celica’s right side. Changing lanes to the right required extreme caution.
  • The first few monthly closings at KA were, as always, difficult. Query/36 sometimes helped the reconciliation process. Nevertheless, on one occasion we had a discrepancy of ten cents in the accounts payable account. Sandy told me not to worry about it, but we had the tools to find it, and so I persisted. I eventually discovered that no vendor was off by a dime. Instead, three invoices were off; all three had discrepancies of more than $100, but they almost perfectly balanced one another.
  • Sandy taught me that if a discrepancy was divisible by nine, it was probably a transposition error.
  • On one occasion guys from the Australian national swimming team were in the office for some reason. Sandy and most of the other female staff members thought that they were very hot.
  • Sandy liked the system’s reports a lot. I am pretty sure that she asked for a couple of revisions, but I do not remember the details. I do remember that, despite the fact that we spent a lot of time making sure that the results of the cost accounting system agreed with the cost accounting system, she never showed any client profitability reports to Dick. She said that that would open a can of worms.
  • I went to KA once during the period in which I was weak from cat scratch fever (as described here). It happened to be on the day that KA was moving its accounting department from the ground floor to the second floor. I carried a printer or something, but the effort totally exhausted me.
  • At some point in 1988, I think, Sandy fell out of Dick’s favor. She was reassigned to take charge of the scheduling of production jobs, a clear demotion. I never learned why all of this happened.
  • Dick hired a woman with experience from a New York agency to replace Sandy. I tried to explain to her why the system’s method of calculating work in process (WIP) was superior to the method advocated by the AAAA, but I don’t think that she bought it.
  • The last time that I went to KA Shelly was in charge of the finance department, and the New Yorker was gone. On that occasion Michael Symolon, our salesman at the time, accompanied me. Evidently he had gone on a date with Shelly once and was embarrassed about it. He stayed in the background. That was the only time that I ever remember him being shy.

When the system had been working successfully for a few months, Dick Keiler arranged to be interviewed by AdWeek New England about our system. It was a very nice article that heaped praise upon our system. It started on the front page, and it continued for several paragraphs in the middle. I had only one minor quibble: THEY NEVER MENTIONED THE NAME OF THE SOFTWARE OR THE COMPANY THAT DEVELOPED IT!!!

TSI had, for the first and only time in its existence purchased an ad. It appeared somewhat close to the article’s continuation page. However the ad was not precisely the same size as the hole that the magazine needed to fill. The way that they floated it in made it look really unprofessional.

I was quite upset about this. I wrote a letter to the editor complaining about both of these things. He called me. He did not apologize. He said that he did not think that it would have been proper to identify TSI. I reminded him that the article clearly identified the hardware vendor as IBM. What was the difference? He repeated that it just did not seem proper. He also thought that our ad looked fine. I hung up on him.

I made lemonade out of this by writing to all the prospects in the northeast about the article, providing “what AdWeek neglected to mention.” It generated a few inquiries.

1. Dick Keiler founded the agency in 1972. He started his retirement process in 1999 and left the company five years later. In 2021 he lives in Tucson Arizona. The agency went out of business in 2015. The last few years are described here.

2. I am pretty sure that in 2021 Sandy Procko resides in Westbrook, CT.

3. I was slow to come to the realization that when trying to sell systems that generated no revenue for the purchaser, it was best to strike when the iron was hot. One of our clients later told me “Christmas only comes once.” The person recommending the purchase always dreaded making a mistake. He/she most feared the prospect of telling the boss a little later that the company needed to purchase more hardware. I always thought that IBM proposed systems that were bigger and more experience than necessary, but they were more experienced at this process than I was.

4. The S/36 operating system, called SSP, used the term “procedure” for a list of commands that were to be executed sequentially. In addition, BASIC used the same term for a sequential list of BASIC commands that could be executed inside the interpreter. On the Datamaster the user was always in the interpreter, and so there was no confusion.

1981-1988 TSI: Working with Ad Agencies

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What I learned from working with advertising agencies. Continue reading →

When Sue and I first met with the people from Harland-Tine in 1981, everything that I knew about advertising agencies came from watching Bewitched when I was in high school. I soon learned1 that most medium-sized ad agencies included people with the following types of jobs:

  • Account executives: These were the people who meet with the clients. Their primary function was to keep the clients happy, either by explaining what the agency was accomplishing or by keeping them in the dark. Some were also responsible for recruiting new clients.
  • Creative: Writers and artists usually worked in teams of two or three to come up with the campaigns and the ads used in them.
  • Production: These people actually executed the ideas.
  • Media: These employees communicated with the stations, networks, publications, etc. to schedule the advertising. They also made sure that the media vendor provided documentation that the ads were run as scheduled. In broadcast this was done via affidavits. Print media supplied tearsheets.
  • Administrative: Billing and other functions were done by the business office. Sometimes there were other areas as well, such as building maintenance and parties. Ad agencies liked parties.

Ad agencies preferred to measure themselves by their “billings”, a more than slightly deceptive term. An agency that describes itself as having $10 million in annual billings did not arrive at that figure by adding up the figures on the invoices that they sent to clients. The reason for this is that the broadcast entities and most magazines paid, at least in theory, ad agencies a 15 percent commission on everything that they bought. So, if the agency had sent invoices to the client for $10 million of media that it had billed, $8.5 million of it probably was paid to the media. Still, the agency billed it all, right?

Some vendors, notably most newspapers, did not give agencies commissions. Some agencies therefore marked up these charges by 17.65 percent to make them equivalent to other media. Regardless of what they actually billed, the reported billings would include the markup, not on their tax forms, but for promotional purposes.

Luis Delgado, who played Officer Billings on The Rockford Files, was also James Garner’s best friend.

In order to put agencies that that concentrated on other aspects of the business on the same footing as ones that billed a lot of media, it was common practice for agencies to use the same or similar ratios to calculate the “billings” that they reported. If a client paid a retainer, for example, of $1.5 million per year, that also was treated as $10 million in “billings”.

Further adjustments were also made, sometimes for questionable reasons. If they often used freelancers or other vendors on projects, should their costs be deducted before doing the calculation? The one overarching principle was that no one ever adjusted billings down. I once walked into an advertising agency that claimed “$50 million” in annual billings. I counted only six desks there. .

When I wanted to know how big an ad agency was, I asked them how many employees worked there. That was a better proxy variable for the amount of work that went through the agency than its billings.

Not every agency was a “full-service” agency. Some of them used a service to purchase media. On the other hand an agency in Illinois that we talked with did almost nothing but place newspaper ads for Sears. Another ad agency that used our system mostly produced point-of-sale signage for the beef industry. One “agency” in the Hartford area actually tried to talk its clients out of advertising. Instead, it promoted the idea of press releases. The agency would write them, and then try to persuade various media to run them verbatim or at least cover them as news items.

The most important equipment for an ad agency in the eighties.

An agency could be as small as one or two people. The two essential items are a telephone and a good contact list, which in my day was likely kept on a rolladex.

Some international agencies were enormous, but many agencies of any size were startlingly ephemeral. I found that most ad agencies were no more than two phone calls away from oblivion. That is, very few of them could afford to lose their two biggest clients. In the big Madison Avenue agencies when an important account changed agencies, the creative team and sometimes others involved in the account might just move to the new agency. Any agency of any size that lost one of its biggest accounts would most likely cut staff and other expenses to compensate for the loss of revenue.

The proprietors of medium-sized agencies understood this. Most had at some point experienced it first-hand. In order to maximize their chances of surviving the dreaded phone call, they tried to minimize fixed costs. They would rather rent than own. Something that could not easily be used to wow a client or a potential client seldom made much of an impression on them. The usual argument that automation improved efficiency generally fell on deaf ears.

When I did pitches to clients, I emphasized billing. If the agency was not prebilling its media—billing from the schedule rather than from invoices from the vendor—I emphasized how easy it was to do this with our system. I argued that in those inflationary times they should be making 1 percent per month on their money. So, billing two months later was like forfeiting two percentage points of their commission!

I also explained how they could easily customize the invoices for other types of jobs. Each client’s could look different. It wasn’t exactly sexy, but at least it was client-oriented. I knew well that very few agency heads were looking to make life more pleasant for their bookkeeper.

The other thing that I focused on was the profitability of client agreements. Most agency owners with whom we dealt had only a vague idea as to which clients are profitable. Few of them were good businessmen. We could show them on the system’s cost accounting reports how to analyze the profitability of clients for the month and year-to-date, and, if they found a problem, they could probe more deeply with other reports.

I think that our system served our agency clients well. I know for a fact that it helped a few of them through some difficult times.

A few aspects of the way that we handled accounting for advertising agencies were somewhat unique. These features were not really marketable unless the agency’s accountant was involved in the purchase.

I never read this book either.
  • We developed separate systems for media billing and accounts payable. They did not use the same programs used for other billing and vendor invoices. Both the billing and the A/P systems matched up the invoices with the items from the media scheduling system.
  • Non-media jobs that were billed in advance were credited to an advance bills account. The entries taking these amounts as income had to be made individually.
  • Every agency that did any kind of production or creative work kept an asset account called billable work-in-process (WIP). The system printed a list of the WIP for every active job at the end of the month. The change in WIP from month to month was booked as income.2

These methods were my own invention. I never took an accounting class in college and, for that matter only one programming. Never, however, in my thirty-five years of setting up computerized accounting systems for people did anyone challenge my credentials.

Spare me the consultants!

Some agencies recognized that they needed to computerize the administration of the agency, but they were not competent to figure out how to do it. So, they hired consultants. I absolutely hated dealing with consultants. They would begin the research process with a set of standards that they had developed, not from dealing with ad agencies or even by listening to what the agency in question hoped to accomplish, but from their experience with other companies that were unlikely to be comparable to ad agencies.

Sometimes they would send out a Request for Proposal (RFP) that outlined the requirements that they intended to impose. Often I could tell that TSI would be eliminated immediately for one reason or another. Almost never did the RFP ask if the system could be customized, or if it generated any of the billing or client profitability advantages outlined above.

Only one of our installations was produced through a consulting firm, and it was a disaster for us (wasted time), the agency (wasted a lot of money), and the consultant (law suit), That experience is described here.

The experience with advertising agencies broadened my horizons. I learned enough about the details of advertising that when the opportunity arose, I was able to make a successful pitch to Macy’s advertising department. That story is told here.

I also amassed enough details about the mindset of an advertising executive that I wrote a prize-winning short story about one. That account is here.

I never got interested in advertising, but in order to market to the New England agencies I had to follow their ups and downs. Seeing a few dramatic crashes reinforced my desire not to depend too much on any one client. That philosophy helped to sustain us through the nightmarish year of 1991, when our two largest clients both declared bankruptcy.

1. The Internet drastically affected advertising agencies. Much of what I learned is probably obsolete in 2021.

2. The American Association of Advertising Agencies (AAAA, pronounced “four A’s”) recommended a different method that was more cumbersome and less useful. Every accountant who ever saw what we did thought that it was equivalent but provided more useful audit trails, took much less time, and was less susceptible to errors.