As senior analyst for InfoCorp, a $2-million-a-year microcomputer market research firm in Cupertino, Calif., John Kiefer keeps close tabs on companies that are working to connect mainframes and minicomputers with micros. In the past few months, however, Kiefer's interest in the subject has become more than academic. That is because the linking of InfoCorp's IBM System/38 minicomputer with an IBM Personal Computer has made his own work easier.

The advantages of linking big and little computers are obvious. Mainframes or minis store the data that comprise the entire historical record of a company. But, says Esther Dyson, president of Rosen Research Inc. in New York City and editor-in-chief of a microcomputer newsletter, RELease 1.0, while larger computers are very good for number crunching, they are not very good for interactive processing. Mainframe software provides reports and does batch work. On [personal computers], typically, you don't get reports, you get answers." Besides, running application programs on big machines is far more expensive and complicated than on micros.

InfoCorp's analysts knew all about the advantages of personal computers. But at the time that the company bought its $150,000 System/38, there was no way to connect it to micros. And the company's needs dictated that it buy the larger machine. Since InfoCorp is in the information business, it has significant amounts of data to store, more than a micro -- even one equipped with a hard disk -- could handle. And very sophisticated software is required to manipulate that information. Predictably, however, the decision to go with the mini made life difficult for employees at first.

With the 10 terminals InfoCorp rented for the System/38, analysts could call up information and display it; they could also use the mini's software to analyze the data. But there were two problems.

First, although the mini had a spreadsheet program, it was, says Kiefer, "horrendous." Products like Lotus 1-2-3 or VisiCalc, which run on micros, are, he says, "an order of magnitude superior." Designed for nonprogrammers, they are far easier to use and more efficient analytic tools. Second, there was no graphics software. "We do nothing but pie charts, bar charts, and line charts all day long," he says. "It's a real pain in the neck to strip the data off the [mini] and plot it out by hand." Kiefer's solution was to bring in his own IBM PC. He then had two terminals on his desk -- one to collect the data from the mini, the other to manipulate it in a form he could use.

Then IBM came out with software and a board, for $893, that could be inserted in the PC to make it emulate, or act like, a terminal. Now Kiefer can collect data from the mini and use Lotus 1-2-3 on the micro to analyze it. And he can quickly create graphs. "We get the data into 1-2-3, manipulate it, punch a button, and out comes the chart. That saves us significant amounts of time," he says.

A portion of the mini's storage capacity can also act as a virtual diskette: The System/38 looks to the PC like a big disk drive and can store work done on the micro. So company analysts can collect their own information and put it in centralized data files. Or an analyst can build a model, walk to the next office, and have another analyst look at it on his or her own PC. The advantages of the PC linked to the mini are so great, in fact, that in the next few months, InfoCorp plans to replace many of its terminals with micros.

InfoCorp's connection, however, is not the most sophisticated possible. With a "smarter" terminal, the mini's data could be converted automatically into a form that Lotus 1-2-3 -- or another application package -- could recognize. So, with a simple command or two, Kiefer could transfer his information directly into the spreadsheet. With Kiefer's "smart" terminal, he can receive information from the larger computer and process it locally. But when he works with 1-2-3, he must save the data he receives from the System/38 in memory, edit it, then key it into the Lotus spreadsheet.

A micro can also be linked to a mainframe or mini as a "dumb" terminal: The machine can display data, which a user can manipulate with the mainframe or mini software, but the micro cannot store or process information from the mainframe on its own.

Making a connection work is not always simple, primarily because large computers and micros use many different protocols, as if they were speaking different languages. Two machines can be linked either directly with cable -- "hard wired" -- or via telephone through a modem. One common problem arises from the different schemes -- or communication protocals -- by which large and small computers code the information, or bits, that they send over the wires: IBM mainframes generally use what is known as synchronous or bisynchronous communication; micros, usually asynchronous. So the first step is to make one machine use the other's signal schemes. Generally, a piece of hardware provides the physical link and converts one type of signal into the other.

But even a dumb terminal requires simple software to tell the machine what to do with the signals it receives. For instance, without software, a terminal will not understand that a certain character should appear on the upper left-hand or on the lower right-hand corner of the screen. A terminal may need additional software to change EBCDIC, a common way characters are coded in IBM mainframe files, to ASCII, the standard coding for microcomputer files. And, a smart terminal must have programs that let it store data on its own disks and move files from those disks to the mainframe.

Finally, application programs, such as 1-2-3 or VisiCalc, store files in different formats; in effect, they organize their in formation differently. If mainframe or mini data is to go directly into these programs, an additional layer of software is required to reformat data into a form that 1-2-3, for instance, can recognize and accept.

The ability to tap into public databases, such as Dow Jones News/Retrieval Service or The Source, is now commonplace. VisiCorp, in San Jose, Calif., provides a useful variation on this kind of connection. For $250, VisiLink software gives microcomputer users access to Data Resources Inc., a business and financial information database provider based in Lexington, Mass. Users select the data they want -- details on a particular company, perhaps, or foreign exchange rates -- pay for just that data, and receive it in a VisiCalc template, complete with formulas and labels. They then can add information about their own company to do forecasting or make other analyses. Lotus Development Corp. in Cambridge, Mass., has announced similar arrangements with ADP Network Services in Ann Arbor, Mich.

In the past few months, many companies have been concentrating on linking the data contained on larger computers directly with microcomputer application packages. "Now that people have gotten past the basic roadblocks of personal computers, like typing, they want some of that juicy information that's available from an outside or a corporate database, and they don't want to have to key it in," says Chris Christiansen, a senior analyst with The Yankee Group, a Boston-based market research firm. "Terminal emulation has been available for many years, but to transfer [data] into recognizable applications at the micro level is really the key to the whole area."

Although such minicomputer manufacturers as Wang Laboratories, Digital Equipment, and Data General are trying to make their mini and micro software compatible, the bulk of this activity has been directed toward mainframe/micro communication. "That's a marketing decision, not a technical decision," says Robert Schuldenfrei, president of S.I. Inc., a Dedham, Mass., consulting firm. After all, he points out, most of the Fortune 1,000 companies own mainframes, and have the money for additional, expensive software and hardware. Smaller companies that want the same degree of sophistication from their minis must either hire outsiders to customize their equipment or, if they have expertise inhouse, do it themselves.

"The people who are using 370s and 4300s [IBM mainframes] are big-dollar people," says Jonathan Hahn, data processing manager for Regent Sheffield Ltd., a cutlery manufacturer with approximately 110 employees, based in Farmingdale, N.Y. Business owners "who have System/34s and 36s and even 38s [all IBM minicomputers] don't say, 'Okay, you have $100,000 to spend this year.' Every single time you want a nickel, they say, 'You come in and tell us why you need it."

Regent Sheffield owns two IBM PC -- compatible, portable Compaq micros and a System/34 mini. Hahn's problem was getting the data from the mini in a form that could be used by the micro.

His first step was to buy, for $690, a Blue Lynx software and hardware package manufactured by Techland Systems Inc. in New York City. The package turned the Compaqs into terminals, which company managers could connect with the mini, via telephone, when they had their portables at home or when they were on the road.

Company president Jerome S. Hahn and other managers used the Compaqs to look up such information as accounts receivable and pricing. With the Compaqs working as System/34 terminals, they were also useful for word-processing and order entry when other terminals were tied up. But to run Lotus 1-2-3, managers had to key in manually data from reports produced by the mini.

Then, in August, Jonathan finished writing a program that transferred data directly into the 1-2-3 spreadsheet. First he used Techland System's $400 Emulator Transfer Utility -- 34 program to turn the mini's EBCDIC files into ASCII. Then he "fiddled" with the file, until he reached his goal.

It is a "very radical" improvement, says Jerome Hahn. He estimates a job might take about 30 seconds now, where previously it could take half an hour "by the time you print out the report, tear it out, walk it across the office, hand it to somebody, and wait for them to punch it in. Now you press three or four keys and you're done."

Whether or not smaller companies that own mainframes, rather than minis, will be able to easily manipulate mainframe data with their micros depends, in part, on the kind of machines they own and on their mainframe software. "You can't solve this problem in general," says Esther Dyson. "You have to solve it in particular."

However, On-line Software International Inc. in Fort Lee, N.J., plans a more generic solution with Omnilink, which will let users analyze data on micros no matter what software is on their IBM mainframe. On-line will have its own business application programs for the micro and will provide software to allow users to work with the most popular off-the-shelf programs, such as VisiCalc and WordStar. And, because Omnilink is based on Omnicom, On-line's electronic mail package, managers will be able to exchange data on their micros. Omnilink is not inexpensive, however; the basic package costs $35,000 for the mainframe and $1,800 for each PC.

Meanwhile, many mainframe software suppliers, such as Informatics General in Canoga Park, Calif.; Applied Data Research in Princeton, N.J.; McCormack & Dodge in Natick, Mass.; and Management Decision Systems, in Waltham Mass., are working with such micro software companies as VisiCorp and Lotus Development to create micro-mainframe links. Other companies, such as Westwood, Mass.-based Cullinet Software (which reports that 19% of all IBM mainframe installations have Cullinet database software) are developing micro. software that will link with their own mainframe programs.

Oracle Corp. in Menlo Park, Calif., which specializes in relational database programs, is taking a different approach. The company is producing software that will run exactly the same on a $10-million mainframe, a $40,000 mini, and a $5,000 micro. This approach allows users to build identical databases and analyze that information on any kind of machine. Of course, more data can be stored on the larger computers and, because of cost, users will most likely analyze that data on micros.

In June 1981, Atlanta-based Management Science America Inc. (MSA) acquired Peachtree Software Inc., which develops application software for the IBM PC, expressly to create an integrated product line. In December 1982, MSA became the first company to actually ship microcomputer software -- Executive PeachPak -- that provides a mainframe link and allows users to enter data directly into micro application programs.

Fidelity National Bank, a medium-size institution in Baton Rouge, La., bought Executive PeachPak in April to use with the MSA financial packages it runs on its IBM 3031 mainframe. To connect Fidelity National's IBM PC with the mainframe, MSA uses the Irma board from Digital Communications Associates & Technical Analysis Corp. in Atlanta, and PeachLink, one of Executive PeachPak's six programs. Included, in addition to PeachLink, is a spreadsheet, word processor, graphics, list manager, and communications software that lets users dial up The Source or Dow Jones News/Retrieval. The package also includes 20 templates for specialized applications, such as general ledger. MSA charges $5,000 for the first unit, then $1,200 for each additional PeachPak. Each Irma board costs $1,195.

For Susan Babin, assistant vice-president and accounting manager at Fidelity, the package has already paid for itself by speeding up reporting. When managers used to want a system tailored to their own needs, the bank's programmers would wince. "They don't want to change things," she says. Now, "I've been able to take the financial package and go a step further."

It used to take nearly an entire day, she says, to check and refine numbers from the daily income-and-expense report produced by the bank's mainframe. Now she gets the data, loads it automatically into a preformatted PeachCalc spreadsheet, and performs the necessary calculations. The whole operation takes 30 minutes.

Having direct access to mainframe data has other advantages, Babin points out. Running a large mainframe program, she says, is expensive, and there are always priorities as to which systems must run first. Now, she says, "it's like being able to run your mainframe anytime you want to." Working with discrete amounts of information rather than having to handle lengthy files is also an advantage. "With the micro-mainframe access, you can pick and choose," she says.

Other managers in the bank are also enthusiastic about PeachLink, particularly since the program now lets users load information directly into 1-2-3. (PeachLink also works with VisiCalc and DIF, a micro format that a number of different application programs can use.)

Fidelity is on the cutting edge of mainframe-micro communication. Only about 2% to 3% of personal computers installed today are linked to mainframes, says InfoCorp's Kiefer, although he predicts that by 1988, that percentage will increase to 25%. And such problems as error checking and security still exist. "Security is the big issue right now," says Kiefer. While employees are doing their financial planning, he says, what is to prevent them, while on the mainframe, from saying, "Let's browse through the payroll files."

Despite the problems, the move to connect large and small computers will accelerate. Most local area networks (LANs) will have "gateways" that will allow micro users to communicate automatically with larger computers, says Kiefer. Smaller companies, he predicts, will have several specialized workstations -- an engineer, for instance, might use a microcomputer with sophisticated graphics; someone in the planning department will have a 132-column screen to accommodate spreadsheets. All these workstations would then be connected through a LAN to a larger machine, which would store the company's data. That machine, in turn, would communicate with outside databases.

And smaller companies will soon be able to tap into their own databases, which are stored on service bureau mainframes. Lotus Development, for example, is negotiating with all the major time-sharing companies, including Tymshare Inc. in Cupertino, Calif. These bureaus will sell their customers Lotus 1-2-3 and, for an added $500 or so, will provide the software and hardware for a microcomputer connection.

"The smaller businesses that can take advantage of the information available at the mainframe level are the ones that are going to succeed," says The Yankee Group's Christiansen. And, adds Esther Dyson, "for a fair number of people, it's going to be getting a little more real, reasonably soon."