Accenture’s History: The beginnings in the early 1950′s

Blog post written by Jort Possel. Jort is the Global Social Media Director at Accenture and a former blogger on Blogpodium.

As promised in my last post, I want to celebrate 10 years Accenture by looking back at how it all came about. In this post, the early beginnings….

Accenture’s core principles and capabilities are to a large extent centered around our belief in Innovation as a key driver of high performance business. This great emphasis on Innovation is made explicit in our daily work and the events that we organize to discuss the influence of Innovation on how business should be organized. A visible example of this is Accenture’s yearly Innovation Awards which we organize in Amsterdam.

The reason that innovation forms such a core element of our DNA, is rooted firmly in our history.
Accenture originated as the business and technology consulting division of accounting firm Arthur Andersen. The division’s origins are in a 1953 feasibility study for General Electric. GE asked Arthur Andersen to automate payroll processing and manufacturing at GE’s Appliance Park facility near Louisville, Kentucky. Arthur Andersen recommended installation of a UNIVAC I computer and printer, which resulted in the first commercially owned computer installation in the United States in 1954. Joe Glickauf was Arthur Andersen’s project leader responsible for the payroll processing automation project. Now considered to be the father of computer consulting, Glickauf headed Arthur Andersen’s Administrative Services division for 12 years.

Sparking Innovation: Delivering Technology Services
Just prior to his death in 1947, Arthur Andersen left an indelible mark on the organization he founded in 1913 in appointing Leonard Spacek managing partner. By early 1950, Spacek became interested in a new and unproven invention called the electric computer—but he needed help make this technology a reality for clients. To start the journey, he hired a brilliant engineer just out of the U.S. Navy named Joe Glickauf. Little did Spacek know he had taken the first step toward creating an entirely new industry.

After witnessing the data storage and retrieval capacity of the newly-invented UNIVAC (Universal Automatic Computer), Glickauf felt he’d “just seen the millennium” and knew it was something the firm “had to get into.” To demonstrate to the firm’s partners the potential business process value of this device, Glickauf had built the Arthur Andersen Demonstration Computer, better known as the “Glickiac.” After a demonstration at Chicago’s Drake Hotel in 1951, the partners immediately voted to devote whatever resources were required to develop a broad base of competence in the computer field.

The start of what became the first-ever commercial application of a computer in the United States occurred in 1953 when Andersen was hired to program the payroll for General Electric’s Appliance Park manufacturing facility near Louisville, Kentucky. Andersen recommended that installation of a UNIVAC I computer and printer, and General Electric agreed, hiring the Administrative Services team to assist in the design and installation of the system.

The installation was not without its challenges. “I don’t remember how many hours it took to run that payroll, but one thing was certain—it took longer to run the payroll than a week of work,” Glickauf recalled. “And so it was perfectly obvious that if we took this job—if we put the payroll on the computer, that inside of five weeks, we would have put General Electric out of business.”

Undaunted by the initial failure, Glickauf volunteered to re-program the system without cost. Glickauf recalled that General Electric’s vice president smiled and said to him that his company recognized difficulties with innovation and development and agreed to pay the firm on a cost-plus basis. The vice president said he especially did not want to lose the experience Glickauf and his team already had gained. That pioneering spirit and commitment to client service and partnership would come to define Andersen’s Administrative Services Division, a predecessor to today’s Accenture. The team on that project persevered through nearly around-the-clock rewriting of the General Electric payroll software over the course of the next seven months.

Next week, I will discuss how Andersen became a Global company in the late 1950′s.

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