I started drafting this post along with others around the time of my parents’ deaths, then put it aside. However, I have been informed that my father’s old colleague Alton Doody has cancer himself, and if we are ever to get his input, it would be best to solicit it REALLY SOON. So I’m finishing this up now as best I can.
Here’s the part I know from my own memories as
- The son of a Management Horizons employee (namely my Dad).
- A software industry stock analyst (in particular, one who followed Informatics General).
My father moved to the Columbus area in 1973 to join Management Horizons, a consulting firm serving retailers. Management Horizons had its own spin-out already, a time-sharing company called Management Horizons Data Services (MHDS), with which it still shared a building on what is now Old Henderson Road in Upper Arlington. And, this being a world full of coincidences, MHDS is very on-topic for the primary focus of this blog (software industry history).
MHDS’ main business was a full suite of what we might now call ERP for distributors and/or retailers. That never amounted to much. But its secondary business was an electronic interchange for direct placement of orders, called Ordernet. Ordernet turned into Sterling Commerce, a > $1/2 billion company that has been acquired for >$1 billion more than once.
The chain of events, roughly, is:
- Management Horizons sold MHDS to what would become Citibank.
- Citibank flipped MHDS to early software industry conglomerate Informatics General.
- Sterling Software grew itself 10X in size by a hostile takeover of Informatics. (Sam Wyly was involved in that.)
- Sterling split into Sterling Commerce and what I might call The Rest of Sterling.
At that point I forget the details, but a couple of multi-billion dollar acquisitions/divestitures have ensued.
Some day I may dig out the numbers for Informatics’ revenue breakdown in the early 1980s. Ordernet wasn’t big, but looked like a rising star. MHDS classic wasn’t big either, and didn’t look like it was going anywhere. Both appearances were later born out.
Online research uncovered some other sources, namely:
- A two-part biography of Alton Doody’s Management Horizons co-founder William Davidson, whose main relevance to this post is that it pointed me to …
- … a 1996 history of Management Horizons written by Davidson.
- An oral history from Informatics co-founder Werner Frank.
On pages 18-19, the Werner Frank link notes that Informatics acquired MHDS in what sounds like 1974, from then-owner Citibank. MHDS was doing $7.8 million in revenue (which Frank failed to break out among its two business segments), was acquired for $3.4 million, and apparently brought a $3.3 million long-term contract along with it, as well as a cheap loan.
Unfortunately, Davidson’s history* is inaccurate in some details I can check from memory. E.g. it says the Doody Company was created in 1974, which is too early, and it omits Informatics General from the history of MH’s information processing division. It also includes Aetna in the list of outfits that owned MHDS, which is news to me and also, apparently, to Werner Frank.
*As I write this, another copy is available for sale on Amazon. Just Google on “History of Management Horizons.” Yes, we paid around $20 for my copy too, even though there’s a $0.99 price tag on it clearly crossed out.
Anyhow, Davidson wrote:
- One of Management Horizons’ founding projects was helping retrain the NCR sales force away from dumb cash registers and toward what we’d now call point-of-sale devices, a key step in the IT revolution of actually using POS information.
- MHDS started out with two leased IBM System/370-155 computers.
- MHDS was divested to Citicorp’s predecessor bank in May of 1973. “At the time of divestiture some 92 wholesale distribution sites were under contract to MHDS with about 30 or so on-line to it.”