An alert General Electric opportunist,
well aware of the computer studies underway in
General , Electric had circled the notice of ERMA
and bucked it to Syracuse. The newly formed
Industrial Computer Section was electronified into
So a representative was sent to the Bank of America,
---but there were 29 experienced competitors who also recognized the value
of the opportunities involved.
Let me emphasize here that it was no superman who
called on the Bank of America. Rather, it was a confident, dedicated
aggressive General Electric salesman---highly motivated to make the
Company's new computer business a success---one who recognized that the
reward would be worth the thirty million dollar risk---one who recognized
how important the impetus of this order would be in gaining a foothold in
this new market.
The Bank of America had already invested more than two
million dollars in a prototype. They knew, or thought they knew, what they
While 29 competitors tried to persuade Mr. Beise to change his mind and work with
business machines "because they knew and so did we ---that a complete
re-design of the S. R. I. ERMA prototype was required," ---we
agreed to adapt their design wherever we could---without restricting our own ingenuity. The
contract did not mention the S. R. I. ERMA. It
specifically called for automating the Bank's Checking account
Awarding of the contract was announced
on April 25, 1956.
From a four-man team with nothing but office space, ---we had committed the company to a new
business. Engineering work began immediately in Palo Alto, California,
close to the customer and S. R. I. in rented facilities. We built a team
of engineers. But we needed space to operate---space
to manufacture. It was the beginning of a new General Electric Department.
Within six months from the Department's establishment in
Phoenix, Arizona, manufacturing was begun in a 50,000 square-foot rented
facility known as the Peoria Avenue Plant.
One year later, ground was broken for the permanent home
of General Electric's new Computer Department. With the Peoria Avenue
Plant already bursting at the seams, time was at a premium.
Construction proceeded rapidly. It had to. Explosive
growth of the Department's business required bringing together the
functions which were widely-scattered over a 25-mile radius.
The accelerating tempo of the computer business couldn't
wait. Before the building was completely finished, administrative
personnel began moving in --- just six months from the beginning of construction.
The Computer Department is proud of its new
building---and justly so. Since its dedication by Arizona Governor Paul
Fannin and Department General Manager Clair Lasher, the building has
become the home of many computer firsts.
We have developed magnetic character
reading --- the machine readable language that is also eye-readable.
In September 1959, we announced the first completely-automated banking
system using magnetic character reading --the Bank of America's ERMA
This is ERMA, Gentlemen, the machine that put General
Electric into a young, vigorous and growing business, which today is
valued at 1. 5 billion and will reach 2. 8 billion by 1964.
Now that the real ERMA is working, she supports herself,
and has paid back most of the allowance advanced to her while she was
Largely due to the contributions of this young lady, we
are capturing an increasing share of the computer market.
Direct spin-offs from ERMA include. ..the GE 210
Computer System, sold to 14 leading banks--an order for automation of
another banking function transit, --- and new applications of Magnetic Ink
Character Reading. For example, MICR will be used by the General Electric
Spunoff from MICR, we are in these new product
lines encoders, sorters, and re-entry printers. With
our medium sized 225 Computer System and our Industrial Computer line---General
Electric is now a major factor in the Computer industry---Most important,
we have made a major customer happy.
Here's what Mr. Beise, President of the Bank of America
had to say during a recent press conference.
"ERMA is a new concept in banking. Its effects will
be far reaching, touching such things as bank architecture and new banking
services undreamed of today. Because of electronics, we have an eighteen
months' lead time over all other banks in this amazing era.
..thanks to General Electric." Seth Clark Beise is
a changed man.
His business will be a changed business.
He is combining sound business principles with modern business technology
through creative, customer oriented selling, coupled
with a willingness to accept a business challenge and the attendant risks.
Both General Electric Company and the
Bank of America are in the Age of the Computer.
Thank you, Mr. Lasher. The ERMA story represents another
milestone in General Electric's march through the frontiers of progress.
documentary of General Electric's 41 years of computer
experience has been both exciting and informative to me. It's quite a
history. Many more chapters will unfold in the years ahead. Plans are
being mandatory to carry General Electric to a leadership position in the
And now, let's turn the program over to the salesman who
life parallels that of the General Electric Company's milestones of
progress in the computer industry, Bob Sheeley.
To : L. R. SHEELEY
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