Softwear

Clothing label Karman couldn't find a suitable software vendor. So it became one

Three years ago, Gary Mandelbaum, CEO of Karman Inc., had good reason to believe that his latest line of Western-style clothing was a winner. Early word from the 20 sales representatives was that the $50-million, Denver-based company's new clothes -- especially a men's shirt with a bright Southwestern design across the front -- were selling like crazy.

That was the good news. The bad news was that when the orders were tallied, some three weeks after they were submitted, Mandelbaum realized that the company's inventory of shirts had been sold several times over. Many customers were going to be disappointed, and it would take weeks to meet the demand. What's worse, this scenario was becoming all too familiar at Karman, which was releasing a new line of clothes every 13 weeks.

The problem was obvious. Orders were taking so long to get processed that the company didn't know what the reps were selling. If Mandelbaum could see shortages as they developed, he could step up manufacturing or ask reps to hold off until inventory caught up with demand. He would also be able to spot slow movers so that he could let the sales force know where to push harder. "We just didn't know how much we were selling," he groans, "and by the time we did, it was too late to react."

Why the three-week delay? Because reps were handwriting orders on paper forms and shipping them to the company, where the orders piled up until a small army of temporary employees could enter them into the computer system. Equally troubling: 20% of the handwritten order forms were filled out incorrectly, and 10% of the computer forms had at least one keyboarding error. Most of the mistakes weren't discovered until the goods reached the stores, irritating customers and requiring time-consuming order audits.

The solution was equally obvious: the company needed a sales automation system. But after six months of looking, Mandelbaum hadn't found anything that seemed well suited to the garment business. Until, that is, he attended a Western-wear conference in Hilton Head Island, S.C., in 1992. One of the presentations was a 20-minute video by GO Corp. on its pen-based software operating system. The video demonstrated the ease with which pen-based computers could handle various chores in the field. Insurance adjusters, for example, could call up an image of a car, touch the fender to get the price of a fender repair, and then print out the repair cost and what the insurance company would or would not do, right on the spot. In the same way, pen computers could help police officers write tickets, doctors prescribe treatments, or . . . clothing sales reps take orders?

At least that's what occurred to Mandelbaum as he watched the video. Unfortunately, as he soon discovered, no such applications were available. GO was pushing a pen-based operating system, the basic software platform for pen-based computing. Someone else would have to write the application software. Well, thought Mandelbaum, how about us? Karman had some good programmers who could handle the job. And he could always hire others. Who knows, he thought, if the program turned out all right, maybe Karman could sell it to other companies in the garment industry.

Mandelbaum didn't know it, but he had just entered the software business.

Garment-industry salespeople tend not to be cyberjockeys, especially if they're in the 30- to 60-plus age range that tends to predominate at companies like Karman. They're not skilled typists either. "We noticed that very few people could work with a keyboard and talk or think at the same time," says Morgan Porter, Karman's vice-president of information systems. Porter had listened to Mandelbaum excitedly explain his Hilton Head epiphany, and they had brainstormed about the pros and cons of building a pen-based order-processing system.

The two quickly convinced themselves that the benefits of developing a system from scratch would be worth the risks. The decision was easy: both had come from a bootstrapping, no-nonsense background; both had grown up in a family business. From about age 11, Mandelbaum had spent every summer working at Karman for his father, until he'd mastered every aspect of the Western-wear trade. Porter had labored in the construction business for his father, doing industrial painting and sandblasting. Starting up a software affiliate to service first Karman and then other companies didn't intimidate either man. After all, if there had been any competition, they would have been able to find a system for Karman. And thus was born RuggedWare Ltd., a venture jointly owned by Mandelbaum and Porter.

Mandelbaum and Porter realized that they needed to make their computerized system work as much like the old system as possible. Sales is a game played with paper and pencil. Introduce a machine that demands focused attention, and you disrupt the delicate social balance between customers and salespeople. Salespeople should be schmoozing with prospective buyers, reading their reactions, and tuning into their needs, not trying to remember which key combinations they're supposed to type to get the screen menu they need. (Does Ctrl-F3 or Alt-F1 tell me whether the shirt comes in blue?)

In addition the ideal system would provide the latest inventory controls. Even the best computerized ordering isn't worth much if a salesperson can't get instant access to current information on pricing, inventory, sizes, color selections, and delivery times. There's not much point in making ordering more efficient if merchandise can't be delivered. And the system would have to slash error rates, too, by recognizing incomplete or inappropriate data.

Mandelbaum just knew that a pen-based system was the key to breaking his paper jam. He was amazed that software vendors didn't see it. He and Porter decided to get the operating system from GO immediately and put together a programming group.