Unsung Heroes

In this issue we debut the inaugural MIDRANGE Systems 50, our attempt at finding the companies most committed to the AS/400 platform. It wasn’t surprising we found 50 companies that used the AS/400 platform in interesting and innovative ways, but it was surprising whom these companies turned out to be.

I have always known that big companies use the AS/400—most notably Enterprise Rent-a-Car, the nations largest car rental agency, which is rumored to be the largest user of the AS/400 (FYI, Enterprise is not on our list—they didn’t respond to our telephone survey).

The midrange market is all about the supply chain. And this is exactly why the AS/400 dominates the midrange.
What I didn’t know was the wide range of companies that use the platform, and the depth of their commitment to the AS/400. Certainly we hear about the almost fanatical devotion that AS/400 users have for the platform, but I seldom hear an AS/400 user defend the AS/400 the way that Linux devotees defend Linux—vociferously and with a passion that is usually reserved for European soccer teams, Elvis and Bill Clinton. So when the IT director at one of the companies we profiled referred to himself as AS/400’s biggest fan, I was pleasantly surprised. In fact, this person wondered why they weren’t higher on the list. That is a level of commitment you don’t usually see—an AS/400 user that is not only committed to the platform, but also proud that they are committed to the platform.

It’s not important who these companies are. What is important to look at is what industries these companies do business in.

It is clear that when dot-com companies go looking for a platform to host what will become their mission-critical applications, they don’t often choose AS/400. Chances are they don’t even consider it. Those of us familiar with the AS/400 will not find this statement hard to believe. We can argue about why these dotcoms – whose businesses are closely tied to the reliability and scalability of their computer platform – don’t consider using one of the most reliable and scalable computing platforms, but not the fact that AS/400 seldom competes for their business.

Now we know who doesn’t use AS/400, but who does? Well, for the most part, manufacturing and distribution companies, both large and small. Throw in some transportation companies and a bunch of government agencies and that is who uses AS/400. Our list pretty much matches this mix.

You’re probably asking the question, “So what?” and you’re right in asking. The statement in the last paragraph isn’t breaking news. In fact, it isn’t even that interesting. Just like your mother used to say, “If the other kids jumped off a bridge, would you too?”

To gain insight into why the types of companies that choose AS/400 is important, you have to look a little deeper, and you have to answer a few questions. What do manufacturers and distributors have in common? What makes them special?

What they have in common is that they are middlemen. Certainly all distributors are middlemen. They buy from manufacturers or other distributors and sell to other distributors or retail stores. Most manufacturing companies are also middlemen. Most do not sell to the end customer.

What makes them special? The fact that they are middlemen makes them special. They are caught in the middle and for the most part, are not the sole supplier of the product they manufacture or distribute. If they can’t deliver, someone else will. These two factors, along with the advent of just-in-time inventory practices and customization, mean that manufacturing and distribution companies are in a very tight place. If they can’t respond to orders coming from up the supply chain, or place orders down the supply chain, they may as well be out of business.

The midrange market is all about the supply chain. And this is exactly why the AS/400 dominates the midrange. Its reliability means that when customers are looking to place orders, the AS/400 is up. Its scalability means that when order volume increases, the AS/400 can handle the additional load.

Although the AS/400 dominates the midrange, it does not “own” the midrange. There will always be other platforms that the AS/400 must interface with. The AS/400’s continued survival depends on its ability to operate smoothly in a heterogeneous computing environment, whether that environment spans the enterprise or the supply chain.

When a customer or supplier of yours does not use the AS/400 you must be prepared to interface with their systems in some manner, with a minimum of hassle. As long as IBM evolves the AS/400 to keep up with technology standards – especially those that involve data interchange – there shouldn’t be a problem.

So now you have a scalable, reliable platform that can easily “talk” to other platforms, I guess you have it made, right? Well, not exactly. The missing piece of the puzzle, the thing that makes all of this work, is your willingness to look outward, not inward. The future of the AS/400 lies outside the installed base, not within. Once the nay Sayers see that not only is AS/400 a reliable and scalable computing platform, but it is fully capable of operating in a heterogeneous computing environment, they will flock to the platform.

Well, at least that is the theory. Only time will tell whether that theory is proved to be correct, or shown to be a fraud, like Ptolemy’s earth centric view of the cosmos.

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