Technology: There’s Even One That Says: Oh, That Tickles

Businessmen who crowded into San Francisco’s Civic Auditorium last week tried their hand at playing blackjack against a computer. They inevitably lost, for the machine has not only broken the bank at Las Vegas in a test, but also outwits comptrollers and architects in performing such practically profitable jobs as laying out real estate subdivisions. Dozens of other whirring and flashing machines demonstrated how they simulate Gemini space flights, balance million-dollar corporate ledgers in a split second, or tap out a frighteningly human message—”Oh, that tickles”—in response to a rap on the keyboard. Such was the scene at the semiannual Joint Computer Conference, where many of the 5,000 producers, programmers and users in attendance boasted that their machines now can do any job that can be defined.

U.S. industry is eagerly putting them to the test. An electronic computer runs crewless auxiliary locomotives on long Louisville & Nashville freight trains. The New York Stock Exchange is installing a computer system that can answer brokers’ questions, keep track of floor transactions at each trading post, and feed quotations to the ticker at the rate of 16 million shares a day. More than 100 companies control their inventories with computers, which record every sale and tell managers when and how much to reorder. Borrowing an idea from the airlines, Long Island’s Maxson Electronics Co. plans by next July to link 5,000 hotels, travel bureaus and car-rental outlets in a computerized reservations network.

Houses & Horses. This year Government and business will spend a record $2 billion for electronic data-processing gear, ranging from $90,000 small computers to $5,500,000 machines capable of 2,500,000 calculations a second. So broad is the variety of computer users that there are more than 1,000 programming “languages”; last week RCA Chairman David Sarnoff urged that the scientists put their minds to devising a standard system to replace the “technological Tower of Babel.” That will be difficult if only because computer technology is changing so rapidly. Most important, computers are being brought into the executive suite, are helping to make more and more executive-level decisions.

Computers now analyze the sales potential of new products, schedule complex production runs, and solve design problems. Before making investment decisions, many bankers and brokers consult Standard & Poor’s Compustat system, whose computer has standardized and “memorized” 30 financial details about 625 corporations, including sales, cash flow and price/earnings ratio of stocks. A New Jersey builder recently relied on a computer to choose the house plans, prices and financing arrangements for a large suburban project. Even Kentucky horse breeders depend on a computer, primed with race results and the physical characteristics of 200,000 thoroughbreds, to serve as a breeding guide.

At the San Francisco meeting General Motors demonstrated how one of its computers, built by IBM, helps engineers create automotive designs. An engineer feeds instructions and preliminary drawings to the machine, which then produces a line drawing of a car or its components on a TV-like console. The machine also can “read” and store up lines from engineering drawings, communicate back and forth with the operator, and turn out permanent drawings.

More Power to Them. Though some managers have lost their jobs to computers, higher-echelon men will not be replaced but simply reoriented to accommodate the machine. At companies such as Lockheed and Westinghouse, young executives are trained in computerized management in night school courses that are a cross between the Pentagon’s war games and Monopoly; competing teams of executives use the machines as aids in determining the likely effects of changes in prices, inventories, styles or advertising. In a sense, the computer enhances the executive’s powers by cutting through all the statistics and presenting several alternatives, which the executive can act upon. But in the growing dialogue between man and machine, the man who controls the computer has a huge amount of influence in the company.