CONTACTS 
0201 - IBM Program Software Development   203 783 7000; 800 627 8363
020101 - Mr. H. L. Hunger; Director =203 783 7890
020102 - Software Vendor Operations =fax 203 783 7632

SUBJECTS
SDS Marketing, Sales Strategies
Franchising/licensing
IBM, 910724 (SVR File
#912536)

0406 -    ..
0407 - Summary
0408 -
040801 - Director H.L. Hunger, responds via ref DIT 1 to our SDS submission,
040802 - ref DIP 3, arising from ref SDS 1 line 040604.
040803 -
040804 - Cathy Grosholz sent ref DRT 2, requesting evaluation of IBM's submis-
040805 - sion program, based on Hunger's letter, ref DRT 1.
040806 -
040807 - Since these are related matters, we make an integrated response.  DRT
040808 - 1 is analysed first at line 0411, and Cathy's Evaluation information
040809 - is developed at line 0419, in response to ref DRT 2.
040810 -
040811 - Prepared transmittal ref DIT 1 to Hunger, and DIT 2 to Cathy.
040812 -
040813 - Follow Up
040814 -
040815 - Should get response from IBM re SDS oa 911004.
040816 -
040817 -
0409 -
0410 -
0411 - Analysis
0412 -
041201 - Hunger in ref DRT 1 states at para 2:
041202 -
041203 -    "Your request for a marketing relationship has been considered but
041204 -    does not fulfill a current IBM business need."
041205 -
041206 -    Evaluation
041207 -
041208 -    This level of exposition leaves to speculation IBM's understanding
041209 -    of SDS.  Since its position is unsupported in the document, it is
041210 -    incorrect under the record.  The SDS information submitted to IBM
041211 -    asserts that SDS improves productivity and the ability to make
041212 -    money.  If true, it must, by definition, fulfill a "business need."
041213 -
041214 -    The reviewers at IBM might not believe that SDS can be used to make
041215 -    money; however, information was provided that SDS helps people
041216 -    think, plan, remember and communicate.  IBM doubtless has employees
041217 -    and customers who understand that these are the only means by which
041218 -    wealth is created.  SDS then is the tool that applies to all of the
041219 -    industries listed on page 2 of the IBM National Solution Center
041220 -    Software Application Nomination Form, and it integrates the work of
041221 -    all of the software Classes listed on page 4.  However, the review-
041222 -    ers at IBM may not have believed SDS can do this, or may not have
041223 -    grasped its true level of sophistication, and so incorrectly clas-
041224 -    sed it with other products that do in isolation some of the things
041225 -    SDS does through integration.  Or they may not have believed the
041226 -    claimed integration can be be performed by SDS.
041227 -
041228 -    If true, such lack of belief can only be cured through experience.
041229 -    The first level of experience is a demonstration followed by
041230 -    application.  Application is expensive, but a demonstration takes
041231 -    an hour or so.
041232 -
041233 -    I believe that once responsible IBM executives see SDS perform,
041234 -    they will conclude it is unique, extremely valuable to managers and
041235 -    organizations and that IBM is uniquely positioned to perform the
041236 -    kind of marketing that is required to overcome the threshold credi-
041237 -    bility test inherent in Mr. Hunger's initial position.
041238 -
041239 -    Proposal
041240 -
041241 -    Accordingly, I propose IBM make a small effort to arrange for a
041242 -    seasoned IBM executive in the Bay Area to observe an SDS demo. This
041243 -    will insure that in the rush to make a timely response, a valuable
041244 -    new capability has not been overlooked.
041245 -
041246 -
041247 - Hunger offers to:
041248 -
041249 -    "...include details of your application in the IBM National
041250 -    Solution Center, a data base available to IBM marketing
041251 -    representatives with information on software applications.  If you
041252 -    are interested in registering, please complete and return the
041253 -    enclosed nomination form."
041254 -
041255 -    Evaluation
041256 -
041257 -    Without an opportunity to show IBM's account reps what SDS does,
041258 -    they would have no basis explain it to customers.
041259 -
041260 -
041261 - Hunger submits:
041262 -
041263 -    "...some Advanced Interactive Executive (AIX) related literature,
041264 -    including facts and features on IBM's RISC System/6000 family, and
041265 -    some introductory publications on SAA, which include a list of
041266 -    related SAA documentation that can be ordered through your local
041267 -    IBM branch office."
041268 -
041269 -
041270 - Hunger further submits:
041271 -
041272 -    "...a brochure and an application form for IBM's Developer
041273 -    Assistance Program (DAP).  If you are interested in participating
041274 -    in DAP, please complete and return the application to the address
041275 -    on the form."
041276 -
041277 -
0413 -
0414 -
0415 - Developer Assistance Program (DAP)
0416 -
041601 - This program offers discounted IBM products, expedited and discounted
041602 - technical support and some limited marketing exposure through general-
041603 - ized bulletin boards and the IBM publications "OS/2 Application Guide"
041604 - and the "Catalog - Micro Channel Adaptors."
041605 -
041606 - Eligibility
041607 -
041608 - Members qualify by developing and marketing products for OS/2 and DOS.
041609 - Those not engaged in marketing may qualify by submitting a detailed
041610 - business plan showing marketing and development activities and
041611 - schedules.
041612 -
041613 - Evaluation
041614 -
041615 - I would not expect that very many managers like Mr. Hunger would be
041616 - looking in the OS/2 Application Guide and the Catalog - Micro Channel
041617 - Adaptors for ways to improve their productivity and income.  Since
041618 - that is the purpose of SDS, it is difficult to see the advantage of
041619 - using DAP.  Further since the information about SDS that was sent to
041620 - IBM, ref DIP 3, was considerably more detailed than what could be
041621 - presented in these advertising mediums, and Mr. Hunger concluded it
041622 - did not inform him that SDS meets an IBM business need, it seems
041623 - unlikely the DAP advertising would be able to do so.
041624 -
041625 -
041626 -
0417 -
0418 -
0419 - Submission Program Evaluation, ref DRT 2
0420 -
042001 - Cathy requests a "moment of ...time to complete the enclosed
042002 - questionnaire."
042003 -
042004 - The form itself asks 8 good questions and requests comments.
042005 -
042006 - Will treat each question separately below instead of on IBM's form,
042007 - in order to respond appropriately.
042008 -
042009 -
0421 -
0422 -
0423 - 1. From your perspective, what did you find positive about your
0424 -    experience with the IBM Submission Process?
0425 -
042501 - It was timely.  Ms. Lynn Kelderhouse, the initial contact, was
042502 - professional and competent, per ref SDS 1 - 4.
042503 -
0426 -
0427 -
0428 - 2.  What were the negative aspects of the process?
0429 -
042901 - None so far.
042902 -
042903 - IBM has initially rejected making further inquiry about marketing SDS.
042904 - This was expected because SDS is a new product and a new technology
042905 - that has to be observed and experienced to understand.  I had hoped to
042906 - obtain a bit more exposition on the grounds for rejection, however,
042907 - such is likely impractical for reasons of volume and perhaps some
042908 - legal considerations.
042909 -
042910 - I am hopeful, however, that upon request for further consideration
042911 - which is submitted today, ref DIT 1, IBM's Submission program is
042912 - sufficiently supple to disclose in some measure the qualities it
042913 - perceives in the submitted product, here SDS, that diverge from IBM's
042914 - "business needs," as claimed by Mr. Hunger.  This would alert the
042915 - developer about how either the product or the presentation thereof
042916 - might be altered for re-submission.
042917 -
042918 - My particular product is a little different.  No one has the experi-
042919 - ence to evaluate it based on written material alone, because no one
042920 - has ever been able to do the things SDS does, and it sounds incredi-
042921 - ble.  To breach this gap, reviewers associate it with what they do
042922 - know about, and conclude it is no big deal.  This condition cannot
042923 - likely be treated through either procedure or structure, since IBM
042924 - must of necessity initially rely on writings.  At most, one can hope
042925 - to catch a reviewer's attention on a good day, but failure to do so
042926 - cannot be said to be a negative aspect of the process, because there
042927 - is nothing that can be done about it.
042928 -
042929 -
0430 -
0431 -
0432 - 3.  Had you any expectations which were not met?
0433 -
043301 - I expected to be requested to demonstrate SDS, but upon reflection it
043302 - may have been unrealistic for the reasons given in question 2.
043303 -
043304 - I retain an expectation of reasoned response to my follow up inquiry
043305 - of today, ref DIT 1, and so cannot fully reply at this time.
043306 -
043307 -
0434 -
0435 -
0436 - 4.  Were you treated in a courteous and professional manner by the IBM
0437 -     personnel you dealt with?
0438 -
043801 - Yes - see response to question 1.
043802 -
0439 -
0440 -
0441 - 5.  Considering all aspects of your dealings with us regarding your
0442 -     submission, how would you describe your satisfaction?
0443 -
044301 - I am not satisfied, but do not attribute this to an IBM defect, per
044302 - se.  The burden is on me to effectively communicate a new idea.
044303 -
044304 - I will be disappointed in my ability to do this, if there is not an
044305 - opportunity to demonstrate SDS or at a minimum to obtain a reasoned
044306 - explanation of how SDS diverges from IBM's business needs (e.g. SDS
044307 - does "A" and our needs are B, C, K or Q).
044308 -
044309 -
0444 -
0445 -
0446 - 6.  What could we do to improve the way we handle submissions, or
0447 -     interact with Independent Software Vendors?
0448 -
044801 - Without further knowledge about the procedures and constraints that
044802 - lead to ultimate positions communicated to software vendors, a
044803 - reasoned response is not possible.
044804 -
044805 - IBM could adopt SDS as an analytical tool to develop the evaluation of
044806 - submissions, and issue it to support your conclusionary response, as I
044807 - am doing now in this record.
044808 -
044809 -
0449 -
0450 -
0451 - 7.  What is most important to you in how a company handles your
0452 -     submission.
0453 -
045301 - Timeliness of response, depth of evaluation, opportunity for recon-
045302 - sideration.
045303 -
0454 -
0455 -
0456 - 8.  Would you come to IBM with another proposal?
0457 -
045701 - This will depend upon how IBM meets the issues set out in response to
045702 - question 7.
045703 -
045704 -
0458 -