Kurtzig, Sandra L.

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Kurtzig, Sandra L.

(1947-)
ASK Computer Systems, Inc.

Overview

In 1974 Sandra Kurtzig, just 24 years old, took $2,000 from her last paycheck before quitting her job and started a software company, ASK Computer Systems. By 1985, ASK had sales of $450 million, and Kurtzig was being touted as the queen of Silicon Valley.

Personal Life

Sandra L. Kurtzig was born in Chicago, Illinois, in 1947. Her father Barney Brody, the son of Russian immigrants, was raised by his mother after his father abandoned the family when the boy was a young child. Brody dropped out of school during the Great Depression to help his mother pay the bills and later began his own business building houses. Kurtzig's mother, Marian (Boruck) Brody came from a wealthy Chicago family, graduated from the University of Illinois, and worked for a time as a police reporter in Chicago. In the early 1950s, when Kurtzig and her brother Greg were still young, the Brody family moved to Los Angeles, California, where Kurtzig's father built houses that her mother then advertised and sold. As a result, Kurtzig grew up watching both her parents working odd hours, starting from scratch, and setting their own schedules.

Kurtzig attended the University of California at Los Angeles (UCLA) and graduated with a bachelor of science degree in mathematics. She was then accepted into the Stanford Ph.D. program in aeronautical and astronautical engineering, one of just two women in a class of 250. However, after a year, having completed her master of science degree, Kurtzig had serious doubts about her future as an engineer. She took a job with IBM in Palo Alto, California, but the job didn't meet her expectations, and she quit after the first day and spent the summer of 1968 touring Europe. Arie Kurtzig, a recent Ph.D. graduate from Stanford, proposed marriage upon her return to the United States. The two were married on December 1, 1968, and moved into a cramped apartment in Short Hills, New Jersey. Three years later, homesick for her home state of California, Kurtzig convinced her husband to move to Mountain View, California. The couple, who have two sons, Andrew and Ken, divorced in 1983. In the divorce settlement, Kurtzig gave her husband an estimated $20 million—one of the largest settlements ever given by a wife to a husband.

Career Details

Kurtzig began her career after her wedding and a short Acapulco honeymoon. Particularly interested in sales, she took a job with a start–up company, Virtual Computing. In the 1970s, most companies could not afford the expense of owning their own computer systems, so they rented time from computer companies, such as Virtual. Kurtzig was hired to sell these so–called time–shares. But her time at Virtual was barely longer than at IBM. When she arrived on the job, she found herself assigned to writing computer programs, not sales. Three months later, the company instituted a nondisclosure and noncompete agreement (forbidding employees from taking another job with a competitor). When Kurtzig refused to sign it, she was promptly fired.

Still wishing to find a job in sales that would make use of her computer and mathematic knowledge, Kurtzig was able to convince General Electric's (GE) Computer Time–Sharing Service to hire her. She was assigned to the Bell Labs account in Murray Hill, New Jersey. Basically, all engineers and researchers were dependent on programmers who were responsible for all data input and output. Although many researchers had computers at their desks, few had knowledge of or access to useable software. Instead, a researcher would submit data to the programmer who would enter it into the computer system. Results could take a day or a week to finally make their way back to the researcher. Working the Bell Lab account, Kurtzig discovered ways to train the engineers to use their own computers and provided them help in finding or creating productive software, by tapping into the mainframe through which they had access to a number of financial and engineering analysis applications. She went on to work with industrial companies, helping them become more efficient and thereby saving money by enabling them to rely more fully on the fast work of computers.

When Kurtzig decided to return to California, she transferred to the GE Time–Sharing Division in Palo Alto. Her life was set on a new course after she made a sales call at Halcyon, a fast–growing company that built telecommunications equipment. What Kurtzig learned was that Halcyon definitely needed computers but that they also needed expanded and specialized software applications that could track the entire operation of the company, including inventory, orders, and materials used in the assembly of each product—software that GE didn't have. When Halcyon CEO Larry Whitaker asked Kurtzig to write the application he needed, despite nervous doubts, she decided to do it. In 1972 she quit her job with GE and set up her new business in the spare bedroom of her apartment using her $300 advance from Halcyon and a $2,000 commission check from GE. She intended for her new venture to be a part–time job while she started a family. It grew into so much more. ASK Computer Systems was founded with its name based on A for Arie, S for Sandra, and K for Kurtzig, appropriately short and close to the beginning of the alphabet for easy marketing.

Chronology: Sandra L. Kurtzig

1947: Born.

1972: Founded ASK Computer Systems.

1979: ASK sales reached $2.8 million.

1981: ASK became a publicly traded company.

1983: ASK sales soared to $39 million.

1985: Retired as chief executive officer; remained chairwoman.

1989: Returned as chief executive officer and chairwoman.

1992: Retired from ASK.

1994: ASK sold to Computer Associates.

1996: Founded eBenefits with son Andy.

Kurtzig's assignment from Halcyon took five weeks, and she earned $900. Scouting out more business proved difficult, but after numerous rejections, she landed her second assignment with Suburban Newspapers. She wrote software that would keep track of some 1,200 mostly school–age paper deliverers, keep the subscription list up–to–date, and organize the process of dividing up the papers and routes among the deliverers. With this job, Kurtzig not only wrote the application but also managed all data input and output. In so doing, ASK took a step from being a programming company to becoming a service bureau, which provides services beyond writing applications.

According to Kurtzig, she made two crucial decisions early in the life of her company that helped steer it toward success. First, after her experience with Suburban, she focused on developing a service bureau. In this way, she would get paid a lump sum for writing the program, and then servicing the account would bring in a smaller but steady monthly income. Second, she decided to target manufacturing companies for business. She wrote in her autobiography, CEO: Building a $400 Million Company From the Ground Up, "It was becoming increasing clear that as varied as [manufacturers'] products were, their needs were more similar than dissimilar. Perhaps I could use the code I'd written for one manufacturer as a foundation to build upon for another. . . . Focusing on the basics, I could get in, get out, get paid, and not be a slave to a single company."

In 1974 Kurtzig launched her masterpiece application, MANMAN (a play on manufacturing management). It was one of the first universal language programs written to track inventory. To date, Kurtzig had provided her clients with custom applications. Although one program might be similar to another, the two were not interchangeable. Universal application had been used to some extent, for example, in the financial and engineering applications Kurtzig had sold through GE, but the concept of large–scale universal programs had not yet taken hold. MANMAN provided tools to track inventory, parts needed, ship dates, and so on but was not limited to any specific inventory. It could be used to track electronic parts as easily as it could automobile parts. Essentially, MANMAN would eliminate the seemingly archaic method of tracking inventory on cards, each listing an individual part number. Kurtzig linked with a successful time–share computer company that provided MANMAN to its customers. Before long, Kurtzig had such big name customers as Coca Cola, General Cable, and Borden Chemical.

Before the end of 1974, Kurtzig was being courted by Hewlett Packard, a highly respected computer company that wanted to include MANMAN on its new minicomputers. Being in the right place at the right time, Kurtzig was able to profit from the increasingly important link between computers and software. With two other programmers she had hired to help with her growing business, Kurtzig spent nights at Hewlett Packard offices rewriting the MANMAN program to operate on an HP computer. Kurtzig's deal with HP gave ASK enough financial cushion to take some needed risks to grow over the next five years—some that worked and some that didn't.

Eventually, ASK took off. Between 1979 and 1983, sales soared from $2.8 million to $39 million. In 1981 Kurtzig took her company public, offering stock for sale. By 1983 the stock was trading at $20 a share. Because Kurtzig retained ownership of 28 percent of the 11.6 million ASK shares, she became worth over $65 million. Kurtzig's personal fame also grew. She appeared on the covers of the Wall Street Journal, Forbes, and Fortune. In 1985, Business Week named her on its list of the top fifty corporate leaders. By 1985, sales reached $79 million. To highlight the rapid expansion on ASK's value, consider that in 1976, when Kurtzig offered to pay back a $25,000 loan from her father in ASK stock, her father took the cash instead. If he would have taken the stock, that $25,000 would have been worth $12.5 million at the height of ASK's success.

By 1985 Kurtzig was ready for a break from her 20–hour days. She resigned as CEO, but retained her position as chairwoman. She spent the next two years traveling around the world with her two children, taking trips to Africa, China, Japan, and Singapore. She also dabbled in studying French Impressionist painting. In 1986 Kurtzig explained her decision to resign to Forbes, "I was in such a hurry I never had time to smell the roses. ASK was wonderful, but I never got wrapped up in the power trip of it all." However, Kurtzig had difficulty watching as her company began to lose value and the board failed to heed her warnings. In 1989 she resigned as chairwoman and abandoned all ties to the company she had created. However, before the end of the year, with stock prices continuing to depreciate, the board asked Kurtzig to return as CEO and chairwoman. Kurtzig couldn't resist the challenge and returned to her troubled company.

Upon her return, Kurtzig cleaned house and restructured the company leadership. She then redirected ASK's energies to new projects, programs, and developments to catch up to the ever–changing and expanding computer software market. By 1992, Kurtzig had proven herself again, leading ASK to sales of $450 million, making it the largest publicly traded company ever founded and run by a woman. Satisfied with her accomplishments and the position of her company, Kurtzig retired a second time in 1992. However, after her second departure, ASK began to struggle again as competition in the market continued to increase. In 1994 Computer Associates International purchased ASK for $13.25 per share, or $310 million.

Kurtzig's most recent endeavor is in a joint project with her son Andy. In 1996 the two formed eBenefits, which offers human resource, payroll, and benefit services to small businesses online. Kurtzig serves as chairwoman, and her son is the CEO and president. Kurtzig's other son, Ken, also works for the company in business development. Talking about creating the company with his mother, Andy Kurtzig told the San Francisco Chronicle, "We had a very good working agreement. I did all the work; she did all the agreeing."

Social and Economic Impact

During the prime of ASK's existence, Kurtzig was considered one of the most influential women in the United States. She has been widely heralded for her tremendous success in a world dominated by men. However, Kurtzig is not quick to play the gender card. In her autobiography, Kurtzig noted, "I've always tried to make being a woman a non–issue. I worked hard because I wanted to succeed, not to prove I was better than a man. I never felt I was competing with anyone but myself." Still, Kurtzig laughs when she remembers her early days with ASK; when she told people she was in software, most thought she made women's underwear.

Aside from Kurtzig's personal success that began with $2,000 and became multiple millions, ASK rode one of the first waves into the computer age. At a time when computers were huge and hugely expensive, Kurtzig discovered a need and filled it. As computers became smaller and more affordable, Kurtzig guided her company through changes that kept up with the changing needs of businesses and consumers. Kurtzig was one of the first to develop a software company based on universal usage. She led her self–made company to incredible success, retired, and then returned to reestablish its dominance on the market. ASK's fall from high stock prices may be due to economic conditions, but clearly, the company prospered under the tender care of the one who gave birth to it.