The Whitewater Group, founded in 1985, was the first tenant and first graduate of the Technology Innovation Center Small Business Incuba- tor of the Northwestern University/ Evanston Research Park. The flagship product of this small, specialized software company is Actor, described as an “object-oriented programming language and environment” designed to make programmers’ jobs easier when they are creating applications for Microsoft Windows. A “window” is a system in which the computer user calls up, say, a spread sheet by pointing (e.g., with a “mouse”) rather than by typing in a command. In general, windows make computer programs easier to use but more difficult to create in the first place. According to Whitewater, a conventional programming language requires several pages of code (about 300 lines) just to create a window that says Hello. Writing those pages is slow, dull, and error-prone. “With Actor that same window can be created with only two lines of code.”
Cofounders Charles Duff (author of the first book about the Macintosh) and Mark Achler (a former Apple sales manager) combine the technical and business expertises necessary for a successful start-up. Company sales are under $10 million annually, and it has grown from 13 employees in November 1988 to around 50 employees today.
Twenty-one-year-old Pansophic Systems, Inc., sold $232 million worth of computer software worldwide in the year ending January 31, making it one of the world’s largest independent software companies. The company started out in a second-floor Lombard storefront in 1969, and had sales of just $28,000 in 1970. Founder Joseph Piscopo, a programmer at Montgomery Ward, had devised a program he called Panvalet, a “library management product” (still sold) that enables mainframe computer users to call up different programs very quickly.
In recent years, when the mainframe-computer market began to stagnate, Pansophic diversified into the mid-range (“mini”) and personal computer areas as well. It sells software packages for manufacturers and distributors, graphics products (for slide making and animation), information retrieval programs, and–in the latest hot area in this business–its own Computer-Aided Software Engineering [CASE] software, which partially automates and greatly accelerates the writing of new programs. This product can, for instance, help a company avoid horrendous backlogs in programming a computer system to do a new job.
Now headquartered on the East-West Tollway in Lisle, Pansophic employs 1,700 people (750 of them in the Chicago area). Nearly half its sales come from overseas, where it has 26 offices in 14 countries from Brazil to Finland. Piscopo himself retired three years ago at the age of 42.
“I became more interested in the hardware than the software.” That’s how Systems Integration Associates founder and president Bruce Bohuslav explains his company’s start-up in 1983. Having been in business as a “value-added reseller” (i.e., a dealer with special expertise in service, installation, maintenance, and specific applications) of IBM products, he found it natural to move from upgrading someone else’s machines to designing and manufacturing his own microcomputers.
Based on West Pearson, SIA has just 11 employees and a niche at the high end of the PC marketplace, where its machines are used for such things as computer-aided design, desktop publishing, and financial monitoring at brokerage firms (which might mount eight or ten computers side by side on the wall). SIA doesn’t release sales figures–“you can say that we’re a couple of orders of magnitude smaller than Zenith,” says Bohuslav. It’s made its name with speed: Byte magazine rated SIA’s 386/33 machine the world’s fastest in its fall 1989 IBM special edition. SIA’s small size enables it to use chips “that are just going into production,” says Bohuslav. Only 500 such chips may be available each month–plenty for SIA, but nothing for IBM, which needs that many an hour.
SIA likes Chicago better than the suburbs (“easy to get to work”) and much better than the coasts. “We don’t have to get up at 4 AM to talk to the east coast,” says vice president of operations Allison Boness, “and we don’t have to stay up until 10 PM to talk to the west coast. At 4 PM, we can still get parts in from the west coast the following morning.”
The oldest firm in this random sample, Cherry Corporation began in 1953, making snap-action switches in a Highland Park basement with an initial investment of $7,500. Its specialty has long been electromechanical switches, like those in your dishwasher or car. But since the late 1960s it has added a broad range of electronic products, including circuit boards, keyboards, and (most recently) direct-current electroluminescent displays. A “substantial portion” of company profit comes from products that did not exist in 1984.
And Cherry has used its own expertise to retool and automate its manufacturing system, for which it won the 1989 Automated Production Systems World Class Manufacturing Award from a trade group last year. According to Production: The Magazine of Manufacturing Management (December 1989), Cherry’s automated system, involving several robots, can turn out any of 50 varieties of automotive switches at under ten seconds per switch, in quantities that range from fewer than 4,000 to over 100,000. “The entire system is run on a just-in- time basis, with the auto company’s computer placing daily orders directly to Cherry’s computer system.”
This process takes place at the company’s Waukegan headquarters, but Cherry has eight other manufacturing plants in the U.S., Europe, and Japan, with 3,200 employees total and sales of $214 million last year. More than half the firm’s revenue comes from overseas sales.
Founder and chairman Walter L. Cherry, a director of the Chicago High Technology Association, offered this advice to would-be electronics entrepreneurs in a recent issue of Design News: “Take the leap, because no one is going to do it for you.” Compared to 1953, “there are just so many more niches that one can pursue.”
The world is full of Zebras–more than 10,000 of them–according to Zebra Technologies Corporation in Vernon Hills. They print labels, tags, and tickets on “Australian beer kegs, cold rolled steel in Italy, Dutch tulips, and Korean lingerie.” These zebras are thermal-transfer bar-code printers that the user controls electronically; they can be programmed (in Zebra Programming Language) to print a different bar code (or even graphics or text) on each label.
Zebra began in 1969 as Data Specialties Inc., the brainchild of Teletype Corporation employees Edward Kaplan (now CEO) and Gary Cless (now vice president of engineering). “They started out renting a corner in Ed’s father’s northwest-suburban furniture factory,” says company spokesperson Elise Fleischaker. Their original product was a high-speed electromechanical paper-tape punch for use in the machine tool industry. In the early 1980s, when this market began to mature–Kaplan predicted, accurately, that the equipment would be replaced by computers directly linked to the machine tool–the company moved to focus on providing “bar-code labeling and ticketing solutions to business and government.” Although sales data for the privately held firm are confidential, it employs 150 and says that last year’s sales were triple those of 1988. Kaplan received the Peat Marwick High-Tech Entrepreneur of the Year award in 1988.
The key to the company’s future? Continued adaptability: “The market is changing very rapidly,” says Fleischaker. “It’s difficult to say where the technology is going. But as the market changes, we’ll adapt to that change.”
Based in the far southwest suburb of Lockport, 20-year-old KineticSystems Corporation has grown both physically, taking over almost an entire shopping center store by store, and corporately, expanding its product line from a few to more than 150 different modules for “automated standardized data acquisition and control systems.” To take a relatively simple example, if you’re automating an industrial process involving the temperature, pressure, and flow rate of chemical through a pipe, KineticSystems can sell you a system of modules that will electronically monitor, adjust, and record these factors to suit your needs.
Their equipment is manufactured according to internationally recognized Computer Automated Measurement and Control (CAMAC, pronounced “kay-mack”) standards, explains advertising director Joyce Deem. In fact, it was when CAMAC was first being developed in the late 1960s that company founder James Stephenson Jr., then an electronics engineer at Fermilab, saw a need for equipment manufactured to that standard. The company now employs 135 people and sells about ten million dollars’ worth of equipment a year. Its customers include a large segment of the Fortune 500. Says Deem, “Just about anything you want to do out there, we can do it.”
Art accompanying story in printed newspaper (not available in this archive): photos/John Sundlof.