Entering the Ada systems design and coding market
Authors: P. J. Mayer
Venue: Proceedings of the conference on TRI-Ada '88 (1989)

Advice is cheap, and we all know that you get what you pay for. There are many books, courses, and seminars on how to start a business. They have been written or are presented by professionals usually with far greater experience than I. While my general management background has been invaluable, the thing that best qualifies me to address this subject is the fact that we at Strictly Business Computer Systems have recently established an Ada programming shop. I'll share with you our experiences, from inception to the present. I must preface my remarks with the comment that they represent only our single effort in this area. I was fortunate in that my primary associates had successfully established and were operating a profitable business in the computer field, and it was their proven philosophy of adding value that became the keynote of our Ada effort. Additionally, we had the good fortune to make some valuable acquaintances early on in the process &mdash; relationships which enabled us to avoid some potentially costly pitfalls. Perhaps we can do the same for some of you. Now, to the subject at hand. What would seem to be the obvious first step in establishing any business is worth stating and that is the conscious act of making a commitment to the project. In our experience, the commitment was initially made about three years ago &mdash; two full years before the project was actually initiated. The delay occurred because the computer system integration business in which Strictly Business was totally immersed was growing at a pace that precluded devoting the time required to explore the Ada market. Then, a file less than a year ago, I joined Strictly Business with the sole responsibility of researching the Ada shop possibilities, and then managing the shop if the research was positive &mdash; which it obviously was. The fact that Strictly Business was willing to add me to the staff, as pure overhead from the business standpoint, clearly demonstrates that a true commitment existed. That commitment is really three-fold because undertaking such a project requires a dedication of, and money. Beyond that, you must assume the posture that characterizes the entrepreneur, and that is a total immersion in the business. You must identify with it and make it the focus of all that you do. If you and your organization are unwilling to pledge a full-fledged effort, your chances of success substantially diminish. Secondly, since the first phase of this project should be a marketing study, you must select an underlying theme that will provide a framework and give specific direction to your research. From the outset, we were convinced that within the Ada market a definite need existed for additional systems design and coding capacity. The corollary is that this appeared to provide a significant business opportunity. Our research was active &mdash; not passive or neutral. We saw an opportunity, and our purpose was to objectively and concretely confirm our perceptions. At each step in the process we were looking at what value was being added by the person, business or agency that we were exploring. Strictly Business was founded and has flourished on two basic concepts &mdash; namely, adding value through our involvement in each transaction and providing quality products and service to our clients. We scrupulously avoid being hardware and software &ldquo;brokers&rdquo; collecting fees for merely placing products with customers. We consider ourselves as partners with our clients and work to enhance their businesses with the products and services we provide. Having made the commitment and articulated your role and objectives, you must now begin the real work. This part of my message may be preaching to the choir. The fact that you are involved in the Ada community indicates that you have or are beginning to acquire a knowledge of the Ada marketplace. That's essential. Gather as much information as possible about every aspect of Ada. If you know the language, great. If not, that should not deter you from learning as much as you can exclusive of Ada per se. No one in our organization knew Ada before we began hiring our staff, yet several of us became knowledgeable and conversant enough to find our way around Ada circles &mdash; and in the Ada community, that's essential. Regardless of how much you learn in your explorations, the input of people active in Ada is indispensable. One of the most gratifying things our research revealed was the generosity and willingness of Ada experts to share their knowledge. We knocked on a lot of doors and did not find one that was not opened wide for us. Let me share with you some of the avenues we explored in trying to determine whet her or not a real Ada opportunity existed. We first had the advantage of coming from West Virginia whose senior U.S. Senator is Robert C. Byrd who has seen the potential of Ada and has for some years been one of its strongest advocates. With the assistance of two of his staff members, we were directed to the Software Valley Corporation which has been very much involved in bringing the advantages of Ada and Ada-related ventures to our Mountain State. Bob Verhotz, the Executive Director of Software Valley Corporation, in addition to other helpful suggestions, recommended that we contact Mr. Ralph Crafts. Bob had worked with Ralph on a number of occasions and spoke highly of his credentials and performance. We have not been disappointed. Ralph knows his way around the Ada community as well as anyone, and better than most. Almost a year ago, we employed Ralph as our consultant to define the state of the Ada market and give initial direction to our study. During intensive meetings with him, we received a great deal of background information and recommendations of additional areas into which we should extend our Ada network. These three initial contacts &mdash; Ralph, Software Valley, and Senator Byrd &mdash; confirmed that quality-conscious and professional systems developers could definitely find a place in the Ada market. At this point I think you can begin to see two things. The more obvious is the snowball effect of Ada contacts. Your first contact leads to two others which each lead to two or three more, and so on. The second thing is that we were strongly encouraged by each of these contacts, and our perceptions that excellent opportunities existed in Ada were reinforced. If anything, the potential began to look even greater than we had at first anticipated. Our tentacles, at that point, began to extend into additional areas of the Ada community. We have come to share Ralph's belief that the more people you know in this still relatively small group, the better off you are. We traveled to Washington to visit again with Senator Byrd's office. While there, with an introduction from the senator's staff, we also met with a number of people at the Ada Joint Programming Office, including the then-Air Force Deputy Director Major Al Kopp. More support and encouragement. On the same trip we cultivated an acquaintance at the Ada Information Clearinghouse. More support, encouragement, and a wealth of published information. We also briefly visited the STARS office and met with someone who was encouraging and informative about that extensive Ada project. Each of these organizations and individuals had a specific mission designed to enhance and increase the value of the Ada contribution. At that point we had begun to look at equipment and it was here that we found one of our more valuable allies and associates. From our initial contact with the personnel at RATIONAL we found them to be most helpful and open. Our sales representative made it possible for us to meet with two large firms handling major project work in Ada for the Defense Department. I don't need to tell you how valuable it can be to speak with someone who is engaged in the type of work you are contemplating and who has no ax to grind or hidden agendas as far as discussing things with you. Other vendors may have been equally helpful, but I doubt that any could have been more so. We met people doing actual project work in Ada for the government, extending our network and also making some contacts we would later pursue as we sought to put together our Ada staff. In March of this year, we attended the SlGAda conference in Phoenix where we researched a number of vendors, but more importantly, met others in the Ada community &mdash; on the commercial as well as the governmental side. We, admittedly, understood very little of the technical content of the meeting, but our purpose in attending was not technical in nature. We were networking, and our network was rapidly expanding. This might be a good point at which to remind you of the three-fold commitment required in this undertaking &mdash; time, energy, and money. By March our exploratory had gotten into its fifth month and had occupied practically all of my time and a substantial portion of the time of two of my colleagues at Strictly Business. Our travels had included a couple of trips to Washington and the trip to Phoenix as well as visits to Morgantown, WV (where the Software Valley Corporation is located) and Pittsburgh where we met with an active Ada development firm and some folks at the Software Engineering Institute of Carnegie-Mellon University. For a small firm such as ours, the budget for this venture was becoming substantial, but we were making valuable progress toward our objective. Speaking of budgets, probably the largest single start-up expenditure will be the development system you select. Spend sufficient time in making this decision. In equipment, you have a myriad of choices. With the recent validation of a large number of compilers, Ada development can be done, in one form or another, on anything from PC's to the much more sophisticated full-blown systems requiring major financial expenditures &mdash; and cost, at least in our case, was a significant consideration. But cost was only one factor. We also were concerned with other areas. Our initial plans called for a system to support ten (10) developers designing systems and/or writing code. Most hardware suppliers could accommodate that in one way or another. With our lack of experience in Ada, we were also looking for ease of familiarization and operation. And we were very much concerned with the level of support a supplier could provide. Who seemed most qualified and willing to &ldquo;hold our hand,&rdquo; as it were, until we gained some experience? The last major consideration was credibility. We knew that as a start-up operation gaining entree and establishing our credentials with potential contractors was critical. Our development system could say a lot about our commitment and dedication. Technical capabilities being a given, we were willing to pay some premium to project the most professional image. Bottom Line: find the system that will best enable us to efficiently and effectively develop software &mdash; to give our future clients value for their programming expenditures. We investigated three major suppliers &mdash; DEC and DG, both of whom seemed quite capable; and RATIONAL, whose development environment was written in and expressly for Ada. Weighing all the factors &mdash; system capabilities, support, ease of integration and use, reputation, cost, efficiency, etc. &mdash; we came down on the side of RATIONAL, and later decided that we would supplement them with SUN Microsystems work stations. We're happy with our decision and believe, as I said at the outset about the cost of advice, that you get what you pay for. At this time, we are confident that our system configuration will satisfy our objectives and meet our expectations. Something similar mayor may not be right for you. Your situation and needs, not our experience, should dictate your direction on equipment selection. We can only recommend that you thoroughly explore the alternatives. So where were we? We had done a lot of reading and travelling; met a lot of people with whom we'd like to be professionally associated: gotten a tremendous amount of encouragement that had been tempered with some pragmatic cautions; and made some preliminary system selections. Now we were getting down to the nitty-gritty &mdash; putting our plans and a proposal down on paper so that we could launch a sales effort to put together the financing needed to make it go. In formalizing your proposal or business plan, be prepared to spend a lot of hours at a desk with all of your background notes, a dictionary, a thesaurus, calculator, plenty of paper and pencils with generous erasers. With access to a word processor and a good spreadsheet program, you are facing a formidable task; without these two tools, it will seem, and may actually be, virtually &ldquo;undoable.&rdquo; Your proposal or business plan can take any of several forms, and no one is necessarily more or less appropriate or effective than any other. The plan should reflect your corporate style and philosophy. But regardless of the form, there are some elements which are indispensable. Your presentation must inspire confidence in a potential investor, assuming that you, like we, have to seek outside capital to launch your effort. The plan must clearly demonstrate that you have done your homework and thoroughly researched the subject and the market. It should deal with the principal players in your scenario, their credentials, and what they can contribute to the success of the venture &mdash; what value can each add? If yours is to be an extension of an existing business, the proposal must provide business and financial history in a realistic light, yet do so as favorably as possible. Finally, the plan must provide business forecasts in the form of projected financial statements and balance sheets. Have your accountant or someone with a strong financial background assist with the financials if that is not an area in which you have experience and confidence. Ultimately, the plan must convince its readers that you have (a) identified a need in the market and (b) that you are prepared and positioned to meet it. Experienced business pros will be reviewing the plan, so make the effort, and do it right. In preparing all of this information, keep in mind that an investor who decides to participate based on the plan will view it as your commitment. He very likely will measure your success, or lack of it, by using the plan as his yardstick. So, be conservative or at least realistic. Don't put anything into your plan that you might regret. if it were referenced some time later. One of our new acquaintances offered to review our proposal. He was doing Ada work so he could evaluate the presentation from that perspective. He was also very much involved with a managing board composed of experienced venture capitalists, so he could also take a look from that viewpoint. He gave us sound advice. My point is that you should have some disinterested parties whose opinions you value and respect, and who can freely and dispassionately critique your work, review it before you run with it. And, believe me, unless you are superhuman, you will go through several drafts and revisions before you submit the plan for outsider review. Our final plan was the sixth major revision, excluding the many internal changes and edits. Preparing an acceptable and effective plan is a humbling experience that will teach you the value of patience. One final note regarding your proposal &mdash; don't overlook its appearance. A copy of the plan and an introductory letter may be your only exposure as you try to get personal appointments to market your idea. Prepare them with care and attention to detail. Ensure that they reflect the high degree of professionalism that went into their re-search and preparation and which will characterize your business efforts. The content of the plan may not even be considered if the plan itself is not attractively presented. Now that you have what you believe is a good marketing piece, where do you go with it? Our objective was to secure local financing (within our community or at least within the state of West Virginia). We drew on personal contacts, a list of local venture capitalists that we obtained from the chamber of commerce, and suggestions offered by the CEO of one of the banks with whom we had an on-going personal and business relationship. We thoroughly explored various loan, grant, and incentive programs offered by municipal, county and state governments to attract business. If you have a university near you, they may have an office that assists with business start-ups. They may be very helpful if you choose to apply for loans or grants since this is an art form in itself. Don't overlook these potentially attractive sources of advice or capital; they could make the difference. Be prepared to make phone calls, personal visits and send written correspondence in cultivating potential investors. And be sure to have your ducks in line because most of these people did not accumulate their wealth or acquire their positions because they are fiscally naive or stupid. They are, by and large, very good business people who ask direct and probing questions and expect direct, succinct, supportable answers &mdash; and a wrong answer can quickly kill an opportunity. If local capital is not available, you will have to look farther afield. That's an area in which we can't offer much advice as we did not have to pursue it. We anticipated that if we had had to look elsewhere we would have to be even more on our toes, since we would give up the advantage of common ground. We would be negotiating on their turf rather than being from the same community as the people we were soliciting. One of the biggest difficulties we encountered was in selling something intangible. As sophisticated as many lenders and investors are, some are still uncomfortable with the computer field, and especially software, as an area of opportunity. Unless high tech businesses are already an established and accepted investment arena in your area, lenders may have difficulty grasping the concept of investing in intellectual property. Loans or investments for plant and equipment are a piece of cake &mdash; you can survey, touch, walk around or kick the tires of the collateral. In dealing with software, you lose that advantage, and many people are still wary of getting financially involved with something they can't see, touch, taste, or smell. Anticipate some initial skepticism and prepare to overcome it. BEGIN NOW. This is one area where you can't start sowing seeds and nurturing them too soon. Look for or create occasions to discuss with the financial powers in your community the role and advantages and success stories and opportunities in software development. When you come across a good article &mdash; one that's not too technical &mdash; that supports your point, send copies to appropriate people. Most will be read, and you'll be strengthening your case and laying a foundation you can build on later. Aside from the &ldquo;intangibility factor,&rdquo; we found that the key concern of potential investors is the make-up of your staff. If you have on board people with strong credentials and proven track records in Ada, your job will be much easier. We didn't. In fact, we had the chicken-and-egg situation of having financiers citing staff as a prerequisite on the one hand; and our inability to recruit and hire a staff until we had secured financing on the other. It was one of the most frustrating aspects of the whole process. We leaned heavily on the proven track records of those of us who were organizing the venture, even though they included no Ada experience. Special expertise has to be addressed, but good basic management skills and experience are highly regarded, well-respected, and carry a lot of weight. We also capitalized on the credentials of our consultant with whom we had reached an agreement for his continuing services after our start-up, making him a legitimate member of our team. It was true that we had considerable background in computer sales, and had on our staff experienced programmers doing custom work for clients, though not in Ada. Many people perceive experience in one area of the computer field as qualification to perform in what we knew to be largely unrelated areas. Since it worked to our advantage, we did not discourage that perception. While we were putting together our financing, we did some preliminary recruiting. We secured resumes and expressions of interest from programmers by contacting the colleges and universities that were graduating students from computer science programs in our area. From the outset, our objective had been to get our programmers locally, if possible. We believe that local residents, particularly in an area like ours, are more easily attracted to job opportunities near home and are more likely to remain with us because of their ties to the area. We recognized, however, that it was critical for us to attract at least one highly experienced Ada professional to direct the programming effort. We drew on the contacts we had made and also secured the services of two firms specializing in Ada placements. Use every tool you can muster, because this is a difficult area with the explosive growth that Ada is enjoying. Experienced people are hard to find, and you must be prepared for a difficult search and the possibility that you may not have adequately budgeted for this position. This person is key, however, and if you find the right one: the time, effort, and money expended in the search will have been well worth it. Look into training, particularly if you do as we did and recruit most of your staff with little or no practical Ada experience. Budget the time and money to allow for proper training of your people and recognize that they will be unproductive for some period of time after they come on board. We completed the hiring of our staff in early Fall. Theirs is a ten-week-long training program. We anticipate beginning work on our first contract no earlier than the first of the year. Our staff will have been on the payroll for more than three months before they take their first steps toward providing a return on the investment in them. So things have finally come together. With financing secured, you have ordered and scheduled installation of your system; hired and are training your staff; and are ready to undertake some work! Getting that first contract may be a challenge. Use every means at your disposal. If you can hire a professional who can bring contracts with him, so to speak, great! If the contacts you have made in your investigations can't help open doors for you, then you haven't been contacting the right people. If you have a Senator Byrd to lend support, bravo! Get all the help you can. Don't be bashful &mdash; most people are more than willing to lend as much help as they're able. Don't leave any stone unturned. And don't wait too late to begin looking. If, somehow, you can get a contract before you configure your shop it will certainly make it easier to attract financing. We were unable to do that. Few people will let a contract to a non-existent shop. We began to actively seek a contract as soon as we had our financing in place and our hiring underway. Use every advantage to secure that first contract, but recognize that future work will be contingent on your performance and the reputation for quality that you establish. Personal relationships will become much less a factor. Don't bite off more than you can chew on that first contract. Find something manageable that will give you some experience, allow you to establish some credibility, and is small enough to be completed in a reasonable length of time. And go all out to deliver the best product possible on or ahead of schedule. Then you're on our own, and relying on your performance record &mdash; and that's as it should be. The ball will be in your court and how you handle it will determine the flow of the game for the future. I've covered a lot of ground, and again I emphasize that this has been a review of our experience - a case study in which the last chapters are just now being written - and not a &ldquo;how to&rdquo; course, per se. In retrospect, I don't believe that there is much that we would do differently if we were to do it again. We approached the project as a marketing problem and treated it accordingly, drawing on the expertise of others in technical and financial areas. Some of the things we learned would enable us to compress the timeframe to establish a new venture if we were to do it again, but we are relatively well satisfied with how things went. Let me close by just saying that you can become discouraged if you allow it to happen. If you are like we were, the potential of the opportunity is so enormous and so obvious that you won't be able to easily accept the reluctance and skepticism of others. Why can't they see what's as plain as day to us? Why are things taking so long? Be patient and persist. If you're committed, do your homework, lay the groundwork, and do a good selling job, things will ultimately work out. Don't lose your sense of urgency; don't allow your interest to flag; and be patient&hellip;be patient&hellip;be patient. If we have been able to give you any ideas, then we've accomplished our objective. We wish you well. Thank you.