Transcript :

Mike Gifford (MG) interview 30th September 2017
Interviewed by Dag Spicer (DS)
Mike Gifford - The LEO Consultant’s Story
“I realized that IBM was so big and so dominant that the chances of long-term success for ICL were limited.”
DS
Let's begin with your childhood and can you tell us where you grew up and what did your parents do? 

Early Days
MG
I was born in 1936. I was three years old when the Second World War broke out in Europe. My father, who was an electrical and electronic engineer, worked for the Ministry of Supply during the war. What the Ministry of Supply did was to order equipment for the military from various companies in Britain. One of the problems they thought they had was how did they know that what they ordered was what was being delivered? They set up an inspection branch and sent an inspector to each of the major plants in which they placed orders with so the inspector could satisfy the Ministry of Supply that they were getting what they ordered. One of the problems they had was the concern that the owners of these factories could bribe the inspectors. So they wouldn't let an inspector work anywhere for more than about nine months. My father was an inspector and my mother decided that whenever he moved, we moved with him. So I grew up on the move during Second World War that totally screwed, up my schooling. I started school when the war was two years old and I was five. It went on until late 1945. I had several years of rather tattered education! My mother didn't work; she just looked after the family. I had one elder sister and one younger sister when the war broke out. I got two more sisters after the war was over! I don't know if that tells you something about growing up and my education, which in the early days was a bit of a shambles.
DS
Did you enjoy school for the most part, and were you a good student?
MG
I do remember when I was about six, I was at school and I became friendly with a guy who sat next to me, we had a desk for two. He died with meningitis! The next year, I'm in a different class, and I'm friendly with another guy who sat next to me. He died of poliomyelitis. In the third year, no one would sit next to me!
DS
I can see maybe why!
MG
Did I enjoy school? Not all that much. I do remember when I was five though one of the things we were told to do was go and learn your multiplication tables. I remember reciting some of it back to the teacher. I asked her, "Miss, when does three times three not equal nine?”. Now, I never got an answer to that question from any teacher until I went to university and Karl Popper, who was teaching me at the time, told me "It's quite simple Mike." he said, "There isn't an exception, it always equals nine" and he proceeded to go through some proof that this was the
case. I was not attracted to maths or science or things like that because nobody could answer the first simplest question you asked!
DS
Did you have any hobbies growing up?
MG
I played chess. I quite enjoyed doing that and was rather good at it too. I came to beat my father, which annoyed him. I did have another kind of hobby. He built me a crystal set if you know what that is. This is a form of a radio, which has no power other than that which is delivered by the aerial. I can remember one house we lived in where I had a hundred foot copper aerial between my bedroom window in the attic and a tree down the bottom of the garden. I used to listen a lot to what was then the American Forces Network. Listening to big bands and jazz. I still do that today.
DS
That's quite a serious aerial, very sensitive.
MG
Otherwise, no I don't have any memories or have hobbies. Although one thing you might be amused by. I can remember, getting towards the end of the war I went to school in London and I had to take the tram. I had a couple of buddies who lived not far from me but we would join up together to go and get on the tram. In the afternoon, when we came back from school we would get off the tram and then walk together before we split up to go to our various homes. One of the things we liked to do was inspecting bombed-out houses. When you're a kid, war is absolute fun! It's not like grown-ups imagine. The reason we inspected these houses, was that we were on the lookout for body parts! We were really gruesome and hoped we could we find some interesting body parts, like a head or something and take it to school and freak out the teachers. We spent quite a lot of time in bombed-out buildings on the way home but the only thing we found was a tip of somebody's thumb, but we never knew if it really was. The teacher refused to comment when we showed it to him!
DS
Is there anything more about your pre-university life that you’d like to mention?

Naval Service
MG
Back then, it was a requirement to do two years military service. You could do it before you went to university or afterward. I had a look at the numbers and it seemed to me the data suggested that if you did your military first you got a rather better degree than if you did it after university. I served in the military. You could volunteer to do various things. Go in the Army, go in the RAF, or go in the Navy, or indeed become a coal miner. (Editor: some conscripts were not given the choice and were sent down the coal mines as they provided an essential material to sustain war time production). Or if you're a Quaker and a conscientious objector, you could actually volunteer to do non-combatant duties. I asked if I could go in the Navy. But just because you asked it didn't mean they would take you. But they agreed, so I went in the Navy. My principal reasons for asking to go into the Navy was that in the Army and the RAF you got two weeks vacation a year for the two years. In the Navy you got six weeks vacation a year for the two years. There were two other attractions. If you were in the Navy you could buy duty free cigarettes wherever you were based. You couldn't do that in either the RAF or the Army unless you were based overseas. The other thing was there was a battle in the Caribbean, 200 or 300 years ago in which the British Navy defeated the Spaniards and a s a result saved an island from being overrun by the Spaniards! That island produced rum, and they said to the Navy, "We will provide rum for every sailor every day in the navy forever."They were still doing it when I did my National Service in the Navy, so you got rum everyday! The question then was, "What branch of the Navy do you want to be in?" I definitely didn't want to be in submarines. I said, "I'd like to be in the surface fleet-aircraft carriers, big ships... They actually took me in to the carrier fleet. In there the jobs you could do included being an aircraft handler, which meant you're on a deck of a carrier pushing aircraft around and falling off the edge or being knocked off by the aircrafts! Not very nice. The other thing you could be was a photographer. They filmed every take off and landing on the carrier. Then they’d show the movie to the pilot when he gets back, for both his take off and his landing. The other thing you could do was to work in the meteorological branch; which is what I did. I became a navy meteorological person. We would draw weather charts and make forecasts and stuff. That's what I did for two years. 
DS
How old were you when you joined the Navy?
MG
I would have been 19, I think. I know I was 21 while I was in the navy because I got drunk that day. Paralytic actually!

London School of Economics
MG
Shortly afterwards leaving the Navy I had a six-month period between before going to study at the London School of Economics. I got a part-time job during that time. All the time I studied during the vacations, summer, Easter or Christmas, I had to have a part time job because although I had a scholarship it only paid the cost of education. They didn't pay for any living expenses and my parents didn't have any money.
DS
At LSE, what did you study?
MG
I graduated with a B.Sc. in Economics. Essentially, the way that worked it was a three-year course. You had exams at the end of two years and exams on your final year. In my final year, the subjects were economics, statistics and philosophy. KarlPopper was the philosophy teacher.
DS
Can you tell us a bit about him, he's of course extremely famous and well known.
MG
Well of course his main ideas revolved around the development of science and he postulated the idea that science advances by testing predictions. If somebody came up with a theory in Science, he wanted to know, "Well does it predict anything and can we go and test whether the predictions are right or wrong?" If the predictions are correct, then that's interesting. But if the predictions are incorrect, then the theory has been falsified, we will discard it and move on. In his view, you could never positively prove a scientific theory to be correct, but will only say “so far its not been falsified.” He was very interesting man and the most intolerant person I think I have ever had the pleasure of meeting. He was extremely aggressive about people who said things he didn't agree with. Very interesting. Anyway, I did finally graduate after three years. At that time, I had decided to join the computer industry. There were several reasons to which the most important were some advice my father gave me. I told him I wanted to go into business. I didn't want to go into any other things for a lifetime but just business. He said, "Well, what I advise you Mike is, you should go into a business which is in its infancy but which is going to grow very rapidly. The reason why you should go into that kind of business is you won't have to wait for people to retire before you get promoted because the business will expand rapidly and there will be lots of opportunities." He said, "There are only two businesses that fit the bill, one is computing and the other is microbiology." Well you couldn't get degrees in either, so I did economics because I couldn't get any kind of medical degree. The reason is I'm somewhat dyslexic. To get any medical degree, you would have to have passed examinations in Latin back then. Well I couldn't! 

To LEO
It seemed to me my only choice was to go into the computer industry and that's what I did. When I graduated I talked to the careers office of LSE and said, “I want to go into the computer  industry, can you point me in the right direction?" They said,"No, but we will get back to you." Anyway, a week or two later they said well there's a job that you could go and apply for. It's at a firm called LEO Computers. It's in Minerva Road , in London in their factory and they want a temporary worker there. You could go and work for them while you look around for what you really wanted. I went to Minerva Road for about six months and I was told that my job was to go and talk to the engineers who were developing LEO III and find out what changes they've made in their specifications of components. What component changes had they made so that we could update the records and get more accurate costs. The engineers changed the components every day. It was kind of an arduous task trying to get these engineers to tell me. The guy I worked for told me after I had been there a few months that LEO were going to start recruiting trainee consultants in the new year. He said he thought I should apply and I did. I took an aptitude test, which I passed and I became a trainee consultant for LEO Computers. I was then working, not in Minerva Road, but in their offices in Queensway.
DS
Can you tell us what year this is?
MG
I think it was 1959 or 1960. I can't remember.
DS
I wanted to ask you just quickly, because you mentioned it in your summary, I believe it was called the Phillip's Economic computer, the one that used water or fluid of some kind. That is very interesting and well known in computer history. I wonder if you have anything you would like to share about that. How it operated or did you feel that it modeled the economy very well or was it more just a conceptual thing?
MG
There were actually three machines that I met during my life. The first one was when I was staying for a couple of weeks with an Aunt and Uncle of mine. He was an engineer and they lived quite near to Bletchley Park. He worked at Bletchley Park all through the war. He took me on a tour of the beginning of '46  Bletchley Park and showed me what was left of the Alan Turing mchine, which I guess was the first computer I have ever heard of. He seemed to know a lot about it, but he did not tell me much about it. He just said, well here is this and it was a machine to help decode some information put out by Germany. (Editor: Gifford is referring to Turing’s Bombe designed to simulate the settings of the German Enigma encoding device. The first electronic computer was the Colossus designed at Bletchley Park and used for breaking the German secret codes) The second machine - that was an electrical driven machine, I saw when I worked for six months between my military service and LSE. I worked for a company called Clarks Shoes. They still exist and you can still buy Clarks shoes. Their factory was in Somerset. I was living with my eldest sister and her husband and I got a job in their research labs. Not that I did much research or anything like that, but while I was there working on this temporary job, I was taken to see a machine that an earlier generation of Clark had built. It was huge. It was about the size of two grand pianos and was a gravity driven machine. Like a grandfather clock you wind up the weights, as the weights descend the machine would run. On the front of the machine there was a long narrow window and when the machine stopped it displayed an iambic pentameter in Latin. We never knew how it did this. Nobody could tell me how it did it. It did it by obeying the rules of iambic pentameters and the rules of Latin grammar that were extremely strict apparently. Just by obeying these rules, it would generate a new iambic pentameter in Latin every time you ran it. Why you would ever want to make a machine like that is beyond me! Then the third machine was this water driven machine at the London School of Economics, which showed the flow that ran through the economy of Great Britain as a whole. If for example, you  hanged the ‘bank rate’ up or down, the flows of water through the system would show you on rotating charts, what happened to all manner of things. For example, what happened to prices, what happened to employment levels, what happened to gross domestic product, all kinds of numbers you could read off the machine, which was purported to be a genuine reflection of the U.K. economy. I have no idea whether it was or it wasn't, but it was an interesting machine. I don't know if it is still there. (Editor: A version of the Phillips Machine is exhibited in Cambridge University, but it is no longer in use for modellingthe economy. It was a superb instrument for teaching macro-economics)
DS
So by the time you got to LEO you had actually already used three different computers or knew about three different computers. Tell us what version of the LEO machine that you were working on, when you got there. 
MG
When I was at Minerva Road, I was dealing with the development of LEO III and so once I became a trainee consultant it was exclusively to do with LEO IIIs. I had nothing to do with LEO IIs. The first program I wrotewas rather a disaster. I was told that the engineers wanted someone to go to Minerva Road and write a program that would test the arithmetic unit of this LEO III computer to see if it operated correctly. This meant you had it do some arithmetic and then it would match its answer with your answer and therefore you could tick or cross if it did work. I wasn't a good mathematician. The kind of program I wrote, just to give you a sort of overview of it, was a case of division with a number plus five, than it would do it again with plus four, plus three, plus two, plus one, zero. Then it would do it with minus five, minus four, minus three, minus two, minus one and minus zero. Arithmetic doesn't work with minus zero. Rules of arithmetic for minus zero are very obscure and the computers are never involved with minus zero. Their zero is just a zero. However, a s my program was written in binary, I escaped many traps but I got a minus zero in the computer that the engineers couldn't get out! They struggled with this problem for a day or two. They then found a way to get rid of this minus zero, which had kind of t aken over everything. They invited me to return from whence I come and never visit Minerva Road again!
DS
You're still a trainee at this point I imagine?
MG
Yes I was a trainee consultant, which meant I was taught programming. I then was taught the notation for system design. I worked on various kind s of problems for example at CAV which is an engineering company making parts for diesel engines. I did some work for them. I also worked for a company called Cerebos , who took delivery of a LEO III in 1964 (Editor: LEO III/18). Cerebos was famous for making and selling table salt and it made other grocery goods as well. Another company I had dealings with was Tote Investors that operated in competition to the bookmakers operating at the Racecourses; the totalizer. I doubt if you what know what that kind of thing is. It's sort of automatic machine driven way of calculating the odds depending on bets on horses winning or getting second place. I also did some work for H.J. Heinz and EverReady the battery manufacturers. Subsequently, I was asked to take care of a team who were about to take delivery of a LEO III Czechoslovakia at NHKG, and a steelworks in Ostrava. Ostrava is one of the worst places in the world or was then. The coal mine was in the middle of the town as was the steelworks. No trees, no grass, it was terrible. Anyway, I used to go visiting once a week for two or three months to see how the team was getting on. I know that I had some arguments  with the management of Ostrava! One of their jobs was to record and plan the spare parts. I ask to go see the physical spare parts. They had a huge building full of spare parts for the plant. It turned out that many of these spare parts required foreign currency to buy them. When they had foreign currency they bought lots of spare parts. After a while, in London, I was sent off to Birmingham to look after Smith & Nephew, who were about to take delivery of a LEO III. The deal there was that we could sell time on their machine to other customers in the Birmingham area, because initially, they would have more capacity than they could use. When I was sent there, there was a small programming team who were helping Smith & Nephew. There were some systems  failures, but I was the only consultant. I was made manager of the Birmingham branch. Well, about once in every four or five months Frank Land would stop by and say hello. Otherwise, I was  left entirely to my own devices. 
DS
Why?
MG
It's interesting. I was responsible for what went wrong at an extremely early age, which made my father turn out to be correct!
DS
Yes, the advice he gave you was excellent, really good. Do you remember what year the merger with English Electric and Marconi happened?
MG
No, I did look it up but I can't remember. (Editor; The merger took place in February 1963)
DS
Could you tell us a bit about the effect on the company, was it at all once?
MG
Yes, it affected me anyway. After about two years in Birmingham I was called back to London and saw the team that dealt with customers in and around London, primarily commercial or industrial companies. I had nothing to do with local government or universities or banks, just regular kind of ordinary businesses. We worked on selling LEO IIIs and helping the first programs and  ystems to go live on customer premises. We worked in that kind of way of helping customers as well as trying to solve problems. I was pretty much left to my own devices in running a small team. People didn't say why you should do this or that. We just decided what we should do and got on with it.
DS
How did you prospect for new customers?
MG
We didn't very much, they came to us! They had heard that we were doing things with computers. They heard that from other companies. They would want to talk to us about what they might be able to do using computers. It turned out in those early days you couldn't sell a computer to anybody unless you could explain to them how using one would improve their financial performance. Either it could lower cost or it could do something that would help their financial picture. It was only by doing that part that you can ever persuade anyone to have one. We spent a lot of time figuring out how computers might be used in their kind of business. (Editor that is why Gifford and colleagues were called ‘consultants’) Just to give you some examples. There was a very interesting problem that J Lyons & Co, the parent company had about ice cream sales that I remember to this day. They wanted to forecast what the size of sales of ice cream would be in the next few days. The way they did it was that they had noticed there was very big seasonality in the demand for ice cream, the biggest in the summer and less in the winter. There was a second order influence on the demand for ice cream we discovered. If the temperature in the next few days was going to be higher than normal, then the demand for ice cream would go up. And if it was lower than normal, the demand forice cream would go down. You couldn't just take the seasonality factor, you had to take a short term weather forecast into account. There was another interesting problem with H.J. Heinz. A guy called Tony O’Reilly ran H.J. Heinz in the UK. He had been captain of the Irish rugby team and had invented the marketing concept for Ireland of the brand Kerry Gold. You will still see these packs of butter today. He finally wound up running Heinz worldwide. Anyway he had a problem with tomatoes. The demand for tomato products was slightly seasonal, and the availability of tomatoes was very seasonal. There where processing stages with tomatoes where all tomatoes went through stage one, then the stages split up. For example tomatoes that were going into ketchup were processed differently to tomatoes going in to tomato juice and tomatoes going in to cans of baked beans. The problem they had was knowing what kind of inventories should they hold of these things in light of the fact that the supply was seasonal and the demand was not as seasonal, and how to compute all this in an efficient way. Then the problem was how to carry out an intermediate inventory somewhere in their processes. These were the kind of problems that we would discuss with customers and show them that, well if they used a computer they'd be able to solve these things, which would help potentially improve their financial performance.
DS
Would there be reports or reviews of their business logic... ?
MG
We would make a proposal, which might be as half as thick as a phone book, but not such small type. We would explain everything and we would go in to some detail about it because without that it was really not credible that a computer would be useful for them.
DS
It begs the question that perhaps later that argument didn't need to be made as strongly, that people just assumed. I know in the 80s and 90s we assumed computers would equal productivity gains but certainly studies that show it that may or may not have been as great as people think! (Editor: the so called productivity paradox)
MG
That's right, in the early days this was an essential component of selling, but 10 years later it almost vanished. People were buying ‘in boxes’ because obviously that was the thing to do, without really any clear idea about how or where the benefits would arise.
DS
It would be wonderful to see one of those reports, I don't know if maybe the LEO Computers Society has some in their archives. We have a number of those reports done, say by IBM for Bank of America, and those kinds of things that are very proprietary and unique only to that one business. It makes the business case for a $5million mainframe and justifies how they will get a return on their investment and so forth. That's fascinating, of course that limits, I guess in a way, the number of businesses that you can approach because so much work is required on them.
MG
Back then it was a major effort to prepare one of these reports. I'd work 24 hours a day for 3 days non-stop on many occasions producing these reports. It taught me something that was very useful in my later career. It taught me how to identify financial problems in companies and how to fix them. That was helpful later on because the three businesses I actually ran as Chief Executive all had one or other of these problems that needed fixing. The last one, I had a whole bunch of such problems!

ICL
DS
I'm trying to think about the ICT and the merger, and when that was. (Editor: The merger took place in July 1968) Did that have an affect on the company; can you tell us how it affected the English computer industry?
MG
What happened to me is all I know about. I was promoted as a result of the merger between LEO and ICT to form ICL to run a geographic region called London North West for ICL. Now London North West was by far the largest region with many potential customers. If you measured the potential customers, that geographic region had the most headquarters of large UK companies. It wasn't local government, central government, universities or any of those things. I t was just straight industrial or commercial enterprises. It was very interesting combination of folk. The ICT people were into selling boxes from their punch card days and the LEO people were in to solving companies’ business problems. What we had to have was a common approach. We couldn't have two different ways of selling. Only rarely would that work. We reduced the emphasis on the business problems side and put more emphasis on the selling of boxes because that's what our resources demanded of us, and the market had changed. There was a general recognition that computers were a good thing for companies to have. Customers would learn quite quickly how best to use them themselves. (Editor: Or hire consultants.) The other thing that happened was the advent of System Four, which made some differences in the way that customers viewed ICL. At that time ICLs turnover was less than IBM spent on research and development. That's slightly misleading because ICL never developed it's own peripherals, tape decks, disk drives or printers etc. Other suppliers developed all of those. ICL was only doing research and development on the mainframes, not on the peripherals, whereas IBM developed all its own peripherals. But still the scale at which IBM operated was just vast compared with what ICL were doing. Marketing and selling was very much easier for IBM. If you were a potential customer you're going to be someone in the company who is going to be called the computer manager. He or she is going to have systems people and programmers and a whole lot of hardware and software. If you recommend IBM, you can never be criticised. If you recommend ICL, yes of course you can be criticised, "Why didn't you go to IBM?"
DS
Yes, I'm familiar with that, very true. On ICL mainframes, could you attach IBM peripherals?
MG
There were no IBM peripherals on any ICL computers
DS
By the way, were people who did these analyses of how computers could help a business typically called systems people? Is that what you would call a systems man?
MG
In LEO, they were called consultants.
DS
Consultants, okay. Because I notice in the literature if you look at all Datamation magazines for example and IBM recruiting ads there's a lot of call for these so-called systems men, and not women of course back in that time! I'm wondering if those were the kind of people who would do the analysis or they did something else, I'm not sure?
MG
By the way, there was no sex discrimination in LEO. My boss on several occasions was a woman.
DS
Tell us more about that.
MG
It never occurred to me that there have ever been or ever was any sex discrimination in business. I've never experienced such a thing in the computer industry or in LEO. What sex you were was totally irrelevant. Some of the really great programming managers were women. It wouldn't occur to me that, "That's a woman, that's a man. No that's a great programmer." All of that discrimination stuff just simply didn't exist.
DS
That's interesting, isn't it?
MG
I was amazed later in life to find out that it did exist, but I haven't noticed it in any of my work in the computer industry.
DS
That's fascinating. Yes, there's a new book out by a historian called Marie Hicks called Programmed Inequality, published in 2017, and it talks about the British IT computer scene in the 1950s and the 1960s and how women were actually welcomed with open arms. It's only later in the last couple of decades really that women have been excluded again in many people's view. Anyway, we don't need to get into that. Can you tell us what the merger did to the English computer industry from that perspective?
MG
No. My nose was too close to the grindstone! I wasn't in any way involved in what it meant on the grand scheme of things other than I realized that IBM were so big and so dominant that the chances of long-term success for ICL were limited. I knew that much.
DS
Now, two years after this merger you became CEO of LEO in Australia, I believe, is that correct?
MG
Well no, before then, I stopped being in-charge of London North West at LEO and went to head up Market Development for the UK reporting to Les Cole. In that job the main things I was responsible for were, first of all, bonus plans. That's a whole kind of nightmare but I discovered that it was essential that they should be much simpler. Everybody had a little wrinkle they'd like introduce into the bonus schemes that would suit some aspect of performance that they thought was desirable. If you included all of that, then it was an incomprehensible scheme. It would be a bit like the United States tax system. Incomprehensible lunacy! I spent most of my time ‘undesigning’ all these plans so that they were comprehensible and simple and did not include all the ‘bullshit’ they wanted to put in them. That's one job I had. Another most important job was that I was responsible for the training of those of our staff who were involved with customers. These were programmers, systems people and sales people. We had training courses for all these people. One of the interesting things about the training courses was that I insisted that we would only run the training course if we could measure the degree to which the training course had altered things for the better. The behavior of the people we were training. If we couldn't figure out how to do that we wouldn't run the course. This was introduced into the training programmes inside ICL. Measure the results. This proved to be not to everybody's liking but with Les Cole I had enough support to be able to say, "Well, I don't care if you like it or not. If we can't figure out whether it's doing any good, we won’t run it. So shut up!"
MG
With respect to training customers, that was very interesting too. I recall we ran a course for, well, one of our biggest customers while I was in London North West. They would remain a customer of the company when I was running development. It was Tesco. Tesco was the leading supermarket chain in Britain. I designed a course for the managers of Tesco stores, which we ran course for groups of 12, or 15 store managers over and over again because they have hundreds of stores. This course was to show them that the design of the computer systems they were going to use would enable them to do things that they may not have thought of. For example, store managers were organized within geographic regions so store managers would report to a regional manager. The point about the regions was that they were usually very similar sorts of stores with very similar sorts of customers. If you compared the region in the Southwest of England with the region in the Northeast of England, the makeup of goods in the stores were completely different because there were local variations. Not everything was different, but there were some things for example, in the Northeast of England people eat blood sausage. In the southwest of England, nobody eats blood sausage. You have these differences. When they came together as a group in one region I said “What you should do is some experiments, each doing a different one. So you can test in one store what the effects are and what it's reasonable to expect. Those effects will translate to the other stores in your region. You need to cooperate together and experiment with different things so that you get a bigger picture of change”. The kind of things I persuaded them to test were things like this. When you go into the grocery store, is it best to have fruit vegetables on the left or fruit vegetables to the right? Well, it turns out that in the majority of cases when people go into grocery stores they turn left. That's where you put fruits and vegetables. Now I always thought, you should put meat and fish there because that would be the basis of the meal and then the vegetables and the fruits should be at the back of the store because you would add that to the main dish, but you need to choose the main dish first. If that doesn't work, you put the fruit vegetables there and the meat and fish at the back. The booze is off to the right. Then, once you get the basic designs sorted out in your mind you can see what happens if you put the leading brand, let's say of chocolate, on the eye level shelf, against putting it on a lower level shelf? Will you increase the gross margin for food in the store or not. You want to know for each foot of shelf space, what the gross margin is and then if you go up and down with the big brands at eye level and the smaller brands lower or reverse which gives the best results. I say you could test that in one store and the nyou all know what to do because one way you get a bigger gross margin than putting them the other way. What do you put on the names at the end of the line, between two alleyways. What should you put there? Shouldn't you try different things and see what it does to your gross margin early in your thought. Only put those things that do well there. You follow me?
DS
Absolutely, so you're saying this was all facilitated by these new computer methods?
MG
Yes, it was easy to do the calculations because the computer was doing them. You just make a change and then you read out what happened. This was enthusiastically received by the Tesco store managers because they suddenly realized, my goodness me, this is an easy way to find out if we can make more money.
DS
Right. It's actually based on a rational thought process instead of just sort of winging it and doing trial and error. At least this way you will see some rationality behind what you're doing. 

DataEntry Systems
MG
We wrote commentaries on proposed new hardware and software. One of the new products coming down the line were data entry systems where you keyed directly to a magnetic tape or disk. I proposed that we set up a separate sales force for this product line because I believed that the principal market, at least in the UK, would be IBM customers! IBM didn't have such a system and I didn't think that ICL mainline computer salesman would easily get entry into IBM customer sites. I wanted to find a way in. That was my principle feeling about it, but it turned out Jeff Cross, our CEO, decided for slightly different reasons, that yes, there should be a separate sales force for data entry systems in the territories of ICL in Europe. In Europe we set up a new division for data entry and I was made head of that division. On day one, the division had a staff of one, me! By lunchtime, I had a secretary who was fluent in six languages. I needed that and within 18 months we had companies formed, operations working, sales being made in the UK, Germany, France, Spain, Denmark, Holland, Sweden and so on. I had to appoint managing directors for each of these small companies, get a board appointed to advise us on accountants and lawyers and things, keeps things legal and honest. I did that for about two and a half ears. One of the guys who worked for me interestingly enough was a guy called Tim Holley. He ran the UK bit of the division and, subsequently, when I was at the Rank organization, he became managing director of Camelot which won the bid to run the UK National Lottery. That was in competition with the Rank organization as we bid to run the lottery too, but he won and we came second. When I left data entry division to go to Australia to run the ICL Australia, Tim replaced me as head of that division. But the division didn't last because Jeff Cross expected that the revenue growth would be double the revenue growth in the rest of the business and it turned out that wasn't the case.
DS
Could the data entry equipment that you made interact with an IBM shop?
MG
We did sell a number of systems to IBM mainframe customers. A data entry system then was a computer with up to 32 terminals. A person would be on a screen and a keyboard and would type in data like orders or whatever that would go straight to a magnetic device, usually tape. IBM would take the tape and run it on their machines, or an ICL customer could take the tape run it on an ICL machine. The advantage was that you left out the punch card step but that wasn't the most important thing. The most important thing was you could program the data entry computer to check the reasonableness of what's being entered so you could get much better control over potential errors in the data input by having it vetted as you went. Not many people recognize that was an advantage, but it really was because garbage in garbage out.
DS
Right, I remember that.
MG
The less garbage the better.
DS
How did the vetting work?
MG
You wrote a program for the data entry computer so when a girl was typing, it would check whether what was being typed was reasonable. You had to decide what to vet for up front and then write a program to do it. (Editors note: Data vetting had been an integral part of computer applications since the earliest LEO I systems. LEO had developed direct entry systems including Autolector and a Kimball Tag reader much earlier avoiding the key entry stage described by Gifford) A Canadian company made the equipment and the basic software for the equipment. ICL had the
license to sell the product exclusively in ICL territories.
DS
That's interesting. Do you remember their name the Canadian company?
MG
No I don't. You can look it up in one of the books. It's spelled out there.
DS
I'm thinking of the steps before they did this of course. I'm sure you know this. The machine called the verifier. Another clerk would re-punch a card. They would receive a bunch of punch  cards and then re-punch them and see if they were allcorrect.
MG
That's very expensive
DS
Yes definitely. It doubles your labour costs
MG
Once you had a computer installed in an ordinary business of whatever sort, one third of the operating costs were data entry.
DS
Wow, that's very high. 

Australia
MG
I was sent to Australia. My predecessor as chief executive there was ill so he was sent back to the UK to get medical attention. I can't remember his name and I don't think I ever met him but anyway. (Editor: Gifford replaced Cliff Oldham in 1972 when Cliff had serious health problems. Cliff was from the ICT stable and had been Director of GOSO (General Overseas Sales Organisation) in ICL and was sent to Australia to replace Ray Kilroy when Geoff Cross restructured ICL.) I was sent out there and interestingly enough the head of sales in Australia was Neil Lamming who taught me programming when I first joined LEO. When I eventually left ICL Australia, Neil Lamming replaced me as chief executive and I ran that business for about two and a half years. (Editor: Neill Lamming’s oral history is also recorded as part of the Oral History Project) There was an interesting problem we had, it took me about three weeks to figure it out. We seemed to have too much money tied up in inventory. The only inventory we had were really spare parts for some LEO IIIs that had been sold or were installed in Australia. System 4 was only just coming into existence and none had been delivered to Australia up until that point. We were selling them in Australia but there had been no deliveries yet. Why was the spare parts inventory so big? We had a guy who was head of the maintenance system and they had two jobs. They maintained the customers computers from a hardware point of view and they installed the equipment when it was first shipped to the customer. The recurring job was maintenance. I asked to see the spare parts, where are they? I wanted to go and look. We went to a place in Sydney and there were surprisingly few spare parts there. "Well, where are the spare parts?" I asked, "Look at the numbers. We got huge quantities but where are they?" It turned out a number of the customers ran their computers 24/7. During the day they ran routine jobs and then overnight they'd be using the computer to test new programs or new systems. So some of these computers were quite busy. That meant you had to have maintenance engineers available 24/7 or close to it. This means that instead of having one customer engineer you might need three customer engineers because of the shifts they were working. Every engineer had a car and in the trunk (boot) of the car were all the spare parts he might ever want to use. So with three engineers you had three times as many spare parts as you needed. So the spare parts were in the boot of the cars! I got rid of the head of engineering and got a new guy. He and I figured out that this was crazy. So I asked the new head of engineering to go and meet the computer manager of each of the customers and to tell him that what we want to do is put a piece of furniture in their computer suite in
which.we're going to stuff full of spare parts. So now we would only have one set of spare parts instead of three sets. If, by the way, a computer suite is fairly near another computer suite then they would also use the stock of spare parts as well as the customer whose site it on. That was a major reduction in our inventory. We halved it. The other thing was that we were a long way from the UK. Sometimes we ordered spare parts from the UK but we weren't first inline when it came to delivery. And when a whole system was going to be sent to us we weren't inline for early delivery. So I arranged with the head of engineering that he would send to the UK one of his sensible senior engineers for a six month tour of duty and he would would make sure we would get the spare parts as promised. We would get complete deliveries of the system and not have 20 things missing. That saved us a tremendous amount of aggravation. The engineers who were sent were all delighted because of something you might not know about Australians back then which also applied to New Zealanders. Any Australian under 25 had an ambition to travel to the UK and to Europe and then back to Australia. Now the method by which they did this was extraordinary. They would fly to Singapore where they would buy a VW camper van that you could sleep in and they would drive it to England from Singapore! Every Sunday on the South Bank of The Thames, near the Festival Hall there was a very large parking space that you would expect to be empty. But no! It was full of VW camper vans being bought and sold by Aussie's. They bought it in Singapore they sold it in London. They then lived in London for up to six months in Earl's Court in flats. When they wanted to go back they would go down to the South Bank, buy another camper van and drive it back to Singapore. This was the thing that everyone under 25 did. The engineers were delighted! We were very unkind by the way when I ran ICL Australia. We had someone, I can'tremember who it was, who was coming out to visit us. It was one of those people we referred to as "I'm from Head Office, I've come to help", "Oh really!". We said to him "Look, it's probably useful if you have a little bit of a look at the country while youre coming. What we recommend is that you take the 747 to Bombay and then to Perth. It's only one stop on route. When you get to Perth, we'll lend you a car and you can drive it to Sydney. Well, it's three and a half thousand miles! The first two thousand miles there isn't a single town and you stop at the only place with habitation as you get nearer to South Australia from Perth. There is a place called Coober Pedy, you've probably never heard of Coober Pedy, it's where Opals come from, they mine Opals there and one or two people operate these mines. They dig tunnels into the hills and they live in them because it's too hot to be outside. They pull Opals out. That's the only thing you can see basically from Perth to South Australia. When he got Sydney eventually, about two and a half weeks later he was greeted with the phrase "Not like England is it?"
DS
Can you tell us a bit about the state of computing in Australia, how many computers where there at this time in the whole country?
MG
There where about half a dozen LEO IIIs, I don't know if there was a LEO II. (Editor: No LEO Is) We were also selling System 4s. My guess is that when I left, there would have been a few hundred installations of which the majority were IBM.
DS
What year is this when you took over in Australia?
MG
Let me think, about 1976.
DS
The time you spent running North West London, could you give us the start and end years of that, I just want to get the chronology perfectly correct.
MG
It would have been from the ICL merger in 1968 for maybe three or four years.
DS
Naturally, your competition in Australia, probably 9 times out of 10, was IBM, is that correct?
MG
Yes.
DS
Anybody else in the picture?
MG
There was Honeywell, I can't remember others, but the main competition was IBM. We were selling Systems 4 and IBM selling IBM.
DS
Tell us about your transition from LEO to Cadbury Schweppes and how that happened.
MG
When I was sent to Australia, I was told I've got five years to make sure the company is profitable and then a local guy would probably take over for me. At the end of two and a half years the company was profitable and Neil Lamming would take over from me. I told London, well I've done it in two and a half years not five and I'll be on my way to see you and you can tell me what you want me to do next. So I notified the local Board in Australia. What we had on the Board were some outsiders, which was helpful because they would make sure we didn't do something stupid by being ignorant about the way things work in Australia. The Directors, when I told them I was going to leave, all agreed Neil Lamming should take over from me. One of them said, Well, look Mike, Yes, you're going to go back to see what they want you to do at ICL, but I'm a Director of another company a large company in Australia which has also got a British Parent and that's Cadbury Schweppes and they’re looking for a Chief Executive and I am sure that they would like you to do that job, I'm sure the parent company would have the same view so you should move to do that job and not work for ICL anymore back in the UK or elsewhere, but stay in Australia! Their head quarters is in Melbourne not Sydney." Anyway, what happened was that I set off for the UK to see what ICL wanted me to do and also to be interviewed by the parent company Chairman of the Cadbury Schweppes group who was Sir Adrian Cadbury. When I got to ICL, I had expected that I would meet with Jeff Cross, who was chief executive, but he was in America at the time, so I met with the Chairman, Tom Hudson. Tom told me that, I was on a shortlist of candidates to one day be chief executive of ICL, but that would be some distance into the future. He advised me to take the job as chief executive of Cadbury Schweppes Australia, because at that time they didn't have a job for me in the UK. So that's what I did. Cadbury Schweppes Adrian Cadbury interviewed me and I talked to the outside directors of Cadbury Schweppes Australia as well. It was all agreed. When I left ICL, I went to work for Cadbury Schweppes as chief executive of their Australian operations. Now, Cadbury Schweppes Australia was quoted on the stock exchanges in Australia. 40% of the shares were owned by Australians and 60% by the parent company in Britain. The total market capitalization of Cadbury Schweppes, according to the stock exchanges in Australia, made it about the 50th most valuable company in Australia. It was really quite big. It was bigger than most Cadbury Schweppes operations of similar size population because the Schweppes part of their business was its own bottler in Australia. Elsewhere, for example France, which has four times the population of Australia bottling was carried out by independent enterprises. We had all the revenue and costs and profits of being a bottler as well as being the brand owner. That made Australia a bigger business in the eyes of the group and in the market in Australia. There was an interesting problem with Cadbury Schweppes Australia. It was agreed in the UK that Cadbury and Schweppes would merge and form one company. That meant, in Australia, that Cadbury and Schweppes, which were separate businesses, too would merge. The parent company board decided that because of the size of the Cadbury Schweppes business operations in Australia, they ought to send one of their executive directors of the Cadbury Schweppes group to Australia to be Chief Executive. The guy turned out to be a complete disaster! He had no idea how to deal with Australians and Australian management. Both the Schweppes side and the Cadbury side were up in arms about him. They contacted the Chairman of the group, Adrian Cadbury, to take him back to England and fire him because he was a disaster. The outside directors realized this had been a terrible mistake and supported the management in Australia. Cadbury Schweppes Australia, of which I was about to become Chief Executive, had two businesses that had not in any sense merged. They had a management team though that knew how to get a Chief Executive fired! Now these were interesting challenges that I was happy to take on. I became Chief Executive and created a single head office with the key management from both Cadbury and Schweppes in the same building and with their important and direct report s also in that building. We set up a unified financial system and a unified personnel system. We then faced a few business problems. On the Schweppes side the industry was changing from deposit bearing returnable bottles, which have been the history of the business, to one trip plastic bottles and aluminum cans. The whole transport system was going to be different and there weren't going to be deposit bearing returnable containers. The economics for that meant of that all these bottling plants, one at each major conurbation, could be centralized into one huge bottling plant in Melbourne. It turned out that was the way the economics worked best if you're in a one-trip system. We shut 10 bottling plants and opened, what was at that time, the largest soft drink bottling plant in the southern hemisphere. That was a major task that we were engaged in. On the Cadbury side we had another very interesting problem. We were in a period of high rates of inflation and the government in Australia introduced price control legislation. Like a lot of things governments do, it wasn't very well thought out! One of the principles of the legislation was that prices could be increased to cover increases in cost. I proposed, and everyone told me I was mad, but I proposed to the price control board that we increase the price of Cadbury's milk chocolate to cover the cost of increased advertising that I intended to make. The price control board said, "No, you can't do that. You cannot charge the customers more because you're spending more money to increase your market share", well I said, "Yes, I can understand that but I'm not trying to increase our market share. I can guarantee you,if we increase the advertising behind Cadbury's milk chocolate our market share will go down, I can prove it to you."They said, "What?" "Yes", I said, "Here are the historical records. You will see that when Cadbury increases its advertising on milk chocolate our share goes down", "But why is that?", they said, "Well, our share of the market is very much greater than our share of shelf space." When we increased advertising, and we are by far the biggest advertiser in the confectionery business. In
fact we are the second largest advertiser in the whole country. We are only second to the government who advertise even more than we do. Anyway what happens is the demand for milk chocolate goes up with our increased advertising, but then people go to buy milk chocolate and discover there are five brands. The other brands together have the larger share of shelf space than we do. A lot of customers pick other brands rather than Cadbury because they just love the chocolate milk and so our share goes down. We are going to increase our advertising so we are going to spend more money on it and our market share is going to definitely go down, even though our volumes of sales increase. We think that's a cost increase should be reflected in a price increase. In the end they gave in and agreed. It was the worm that finally killed the whole of the price control legislation, because they hadn't anticipated that there could be anything like that. They realized the whole thing was beginning to unravel, so they abolished it about 18 months later.
DS
All sorts of unintended consequences when you introduce those kindsof things.
MG
The other interesting point about the advertising, and I think it was in my second year of running Cadbury Schweppes Australia, is that the Australians Advertisers Association had an annual event in Tasmania at a very nice hotel there in Hobart. It was where they had their annual conference. I was invited to go to this thing because they were going to award me a gold medal for the most significant contribution to Australian advertising that year. The citation read, more or less, "He's awarded the gold medal for sending shock waves of pure terror through every advertising agency in Australia." What had happened up until that moment is that advertising agencies got paid a percentage of the money you spent on the media that you used whether on television or billboards or whatever it was. If they had created an ad’ for you they got a percentage of what you spent on advertising. I said, "Well, we're not going to do that anymore. We're going to pay for the creative thing and we will get somebody else, not the advertising agency, either us or somebody else to buy the space. They will be charging a fee and we'll pay the fee for doing that work, but it won't be a percentage of what we spend on advertising." They all said, "No, you can't do that." I said, "Well, I've done it. That's the way we do business and you can do business with us or not, choose." They chose to do business with us.
DS
Yes, that was their whole business model you upset there. It's great. Can you tell me how and if you applied computer methods to running Cadbury Schweppes?
MG
I left it more or less to the two managing directors, the managing director of drinks and the managing director of confectionery. I changed the managing director of drinks. I got somebody new and brighter than the guy who was doing it, but the guy who did confectionery was fine. I didn't get involved in the nitty-gritty of it all, I could have done, but I chose not to. I thought those two managing directors should be able to take care of the computing that they needed, and the finance guy would also be able to take care of what centralized stuff might need to be done. I was more interested in stuff to do with the businesses rather than how computers were utilised.
DS
Right, got it.
MG
By the way, just for your interest, I don't own a computer and I have not owned a computer since 1975, or had anything to do with computers. I don't even own a cell phone!
DS
I should feel especially lucky then that you're doing this interview, thank you.
MG
The principle reasons are, I knew in the '60s that they are not secure. I knew that because there was a place in England with the largest computer complex in Europe. It was underground in Cheltenham.
DS
Was that GCHQ?
MG
You got it. They and the Americans and the Australians share the same links. Back then they were listening to all radio communication and recording key words and the conversations that went with them. It's only got worse since then. I was not a fan of that!
DS
I understand. There are a lot of ironies in security too. For example, people willingly give up and divulge information to Facebook. Information that they would never give to the government! It’s strange people's notions of security. I can certainly respect your position.
MG
Also, I have the great advantage of being lazy, so I don't have to be up to date with latest technology.
DS
Tell us what you did after Cadbury. How long did you stay there? What happened afterwards?
MG
In 1979 I got a phone call from the Cadbury Schweppes group in London, to say they wanted me to give up my job in Australia, move back to the UK, become a Main Board director, finance director and the group's chief financial officer. When I reminded them I wasn't even a qualified accountant and would therefore be the only chief financial officer of a top 100 company in Britain, who wasn't a qualified accountant. Basically, I was a sales and marketing guy. They said they knew all that, but they also knew or believed that I knew more about cash than anybody else in the group, so they still wanted me to do the job. I did that job from 1979 to 1984. The Chief Executive of the Cadbury Schweppes was due to retire at the end of 1984. So at the end of 1983 a committee of the Board comprising the Chairman and outside directors was tasked with finding a replacement Chief Executive. In the spring of 1984 the committee decided that the chairman's younger brother, Dominic Cadbury, should be the next Chief Executive. This decision was announced to the London's stock exchange the same day and within a half an hour I got a call in my office to see if I'd like to become Chief Executive of The Rank Organization. As I hadn't been invited to become the Chief Executive of Cadbury Schweppes. I said, "Yes, I could be  interested in that." I got interviewed. The Rank Organization I joined The Rank Organization as chief executive in the September of1984 and it was a very interesting business.
DS
Can you tell us a bit what The Rank Organization is? I remember seeing them on the beginnings of certain movies, like Dr. Strangelove for example, as the muscular guy is hitting the gong. What did The Rank Corporation do?
MG
I’d better say a little bit about its history, which was way before I had anything to do with it. It was founded by J. Arthur Rank who had some particular religious affiliation of which I'm trying to remember what sort it was, (Editor: He was a staunch Methodist) but anyway, he thought he would do a good job if he created films that somehow evangelised the form of Christianity he believed in. He started making films to do that. He quickly realized, "Oh, none of the cinemas want to see them." He thought, "Oh, well. I'd better have a cinema chain to show them." So he bought a cinema chain, and then he thought, "I'm making movies that do more than just that religious thing, so I better have a film studio." so he created what become called Pinewood Studios in which were made a huge numbers of films. The business started like that. And then he thought, "Well, to get from making a film to showing it into cinema, you have to have the film laboratory that does the film processing and then makes copies of the film to distribute to all cinemas”. He got a film laboratory and so on and so forth. He then got into theatrical lighting. You can have a business that makes lighting and control systems for theatres and for other kinds of performance locations. So he got into that business. And so the business grew organically over the years. When television came into existence cinema watching declined rather quickly in the United Kingdom because television spread here a bit quicker than it did in the United States. There were a lot of what became empty cinemas, which were turned into Bingo parlours, and so Rank grew up a business of running Bingo. When I joined the Rank organization it largest commercial operator of Bingo. The largest operator of Bingo was the Roman Catholic Church! But Rank overtook them to become the largest. Rank had within it, before I joined, a group of companies called Rank Precision Industries, and one of the things they got involved with was xerography and printers. They actually developed a printer. ICL got involved with it, or was it LEO, I can't remember. (Editor: It was LEO who attached a Xerox printer to LEO III). But anyway, there was some connection through that subsidiary of Rank with the printer business, but that didn't get pursued. What happened was the Haloid Corporation in America invented xerography and developed photocopiers and decided they could exploit the technology in the Americas, but they had no idea how to operate in the rest of the world. What they did was go looking for a joint venture and because of some interest by Rank Precision Industries and its printer interests they decided to do a joint venture with the Rank that had operations around the world, particularly on the film side. They formed an organization called Rank Xerox. it was called Rank Xerox because Rank was going to manage it. It was a 50-50 operation, but ran by Rank. Over the years the Rank Xerox Enterprise decided to form a joint venture in Japan to exploit the technology there and made a partnership agreement with Fuji Photofilm, who were substantial suppliers of film stock to the Rank Organization, to form Fuji Xerox. When I joined Rank, I became a Director of Rank Xerox and a Director of Fuji Xerox. At the time I joined Rank, the profit loss accounts of the group of companies were in a poor state. So in the first two years that I ran Rank, we sold 70% of all the businesses by book value that Rank owned, apart from Rank Xerox, and we invested the proceeds in the 30% remaining businesses. We became much bigger with a very much smaller list of businesses. We also made a substantial acquisition of a company that was in a poor financial state but which operated in many of the businesses in which Rank then operated. It was in the vacation business and Rank had a huge vacation business. It was also in Bingo, Rank was in Bingo, so on and so forth. That company was called Mecca, which we acquired. We also made other acquisitions, but they were all in this core bunch of businesses that I had decided were the ones that we should continue to invest in.
DS
You were there until...?
MG
I left in the spring of 1996. I was there for 13 years. I joined in 1983. There were a couple of things that you might have heard of that we were involved in. Have you heard of the Hard Rock Cafe?
DS
Oh yes, yes.
MG
We acquired Hard Rock Cafe. There were about 250 restaurants when we acquired it, half of which were company managed and half were franchises. The franchised ones were in places we didn't want to operate for various reasons, mostly political. Anyway, that was a business we happened to be in. Have you ever heard of Universal Studios Florida?
DS
Oh yes, absolutely.
MG
That was 50:50 joint venture between NCA Universal and the Rank organization. That was a deal that Lou Wasserman and I agreed to do. Back in the 1940s, the Rank organization had owned 25% of NCA Universal.
DS
Now, when you were divesting the underperforming assets, were these the things that were mostly film-related?
MG
No they weren't. At some point the word had gone out from some idiot Chief Executive of the Rank organization that they were generating a lot of cash and they wanted to make some acquisitions of just anyone rather than make acquisitions they thought should make. Well, of course, any Managing Director of any of the constituents who was thinking of an acquisition wasn't going to  propose any acquisition for the company that would leave them exposed. So they always proposed to acquire a company smaller than they were which would increase their standing and they would remain the boss. So what happened was the dogs got fleas, the fleas had smaller fleas and the smaller fleas had goodness knows what! Most of the acquisitions were stupid and oh, it was just a nightmare. Then there were some ridiculous ownership situations. We owned the two largest office buildings in Toronto on the corner of Yonge and Bloor in Toronto.
DS
Oh, my goodness. I know exactly where that is. I am actually from Toronto.
MG
I sold them, I sold those businesses and then we didn't invest in any more fancy real estates. We owned five hotels in London. Four-star hotels, and it’s ridiculous, what are we doing owning hotels like that? I mean, we don't have a brand, it was just nonsense,so we sold all that. We had a very substantial vacation business with Mecca back-up bingo and we grew that business. We had for example Caravan Parks that we operated in the UK and on which there were two sorts of Caravans. Others owned some of them and we owned some. We would rent out both sorts if the owner
wanted that. These were quite big places. We provided, during the season, food and entertainment for people of the Caravan Park. Typically, that would mean about 15,000 people! That meant that, for example, if we had a bar with the capacity let's say 2,000 you might need four bars each with the capacity of 2,000. We would provide entertainment as well in these bars. In the evenings there would be bars with Bingo and in others there would be some kind of show. So, the Rank organization employed more live entertainers than the BBC! Out of all our vacations and live entertainment business we were by some margin the largest beer seller in the country. Every cinema had a bar, every Bingo club had a bar, every vacation location had a bar. We were also the largest operator of discotheques in Europe. Our idea of the discotheque... you go in a room that has a capacity of about 2,000 people and a bar. Off to the left is a door to a discotheque, and you have to be over 25 to go in there. There was also a door the other way where you could go into another discotheque and which people under 25 could get into. The music in the two places was different. However, they had a bar in each of them and each of them had a capacity of around 2,000 people. So there would be live bands as well as records being played. These places were very difficult to manage. You could get fights, drugs and all sorts of aggression. I always thought it was a good montif not more than one person was killed in one of the discotheques!
DS
My God, oh, no.
MG
They didn't carry the name Rank for that very reason. We had millions of people as customers in all our different enterprises and I was very keen on not calling these businesses Rank that could have been a problem for the groups' support. We used to have within Rank something else I introduced. Businesses were grouped in divisions, each with a divisional managing director reporting to me. They would have five or six or ten managing directors reporting to them running different sorts of businesses within a group. For example, all the film related activity was in one division. All the vacation activity was in one division and all the gambling activity was in one division. We operated 55 casinos in Europe. These businesses each dealt with the public and I met with each of them every year. We went through their books. They had a book on what to do when they have a Public Relations disaster. That was all laid out in the book. Who was going to deal with the questions? Who was going to deal with the press? How we can react to all of this stuff when it happens because it will happen! Of course it did. People would get ill, people would die, and there would be fights and so on Anyway, I enjoyed doing it.
DS
That's really amazing. I had no idea Rank was so diversified.
MG
We employed about 50,000 people. When I left, we were the 50th most valuable company listed on the London Stock Exchange. During the 13 years I was chief executive, the return to the share
holders in terms of price appreciation and dividend payments was over 22% per annum for 13 years.
DS
Wow, that's outstanding!
MG
Well, I enjoyed myself.
DS
Yes, I think your shareholders did too!
27
Well, this is great. Is there anything you'd like to wrap up with? After retirement
MG
When I retired in 1996, I was 60 years old and I'd been running Rank for twelve and a half years. The average tenure for a chief executive of a Top 100 company in Britain at that time was about three and half years. One or two people have done seven or eight. Twelve and a half were completely unheard of. 
DS
It's still unheard of.
MG
I was also an outside director of a company called English China Clays. They mined China clay principally in Cornwall and Georgia in America. I was an outside director of the Gillette
Company from 1993 until it got sold to Procter & Gamble in 2006. In the last four or five years of that, I chaired their audit committee during the introduction of the Dodd-Frank legislation. That was an interesting board. I used to sit opposite Henry Kravis of KKR. The man I sat next to was Warren Buffett who chaired their executive committee. From 2001 I was the director of Danka Business Systems that was a company selling and servicing copiers mostly made by the Japanese and sold the United States. We fired the CEO at one point when I was on that Board. Unfortunately they made me interim CEO while they looked for another one. I wasn't very happy about working full time again for those nine months. Anyway, just a couple of personal things now. When I retired in 1996 we were living in England. My wife is an American. We decided to move to the United States because I had eight board meetings a year in the UK with English China Clays, and 16 board meetings a year in America for Gillette and Danka. That meant I was going to cross the Atlantic 16 times a year if we lived in Britain, but only eight times a year if we lived in America. So we decided to move to America and because Danka were based in Tampa, we decided to move to Florida. We finally sold our house in England and built a house in Naples, Florida. I commuted to Boston and would drive back and forth to Tampa, and go to Board meetings in London. I knew that I was going to retire from all that stuff when I was 70 and few years  prior to that when we started to think about where we're going to live next. Well, we had a right of residence in Australia. That meant we could also live in New Zealand. We had a right of residence in about 20 countries in Europe because Britain is part of the European Union. We could live in America and Canada probably. We would rent a place in the summer when we didn't want to be in Florida for a month or two, and see what we thought of it while over the year we would cross the place off the list. Either it's something Nancy didn't like or something I didn't like, or whatever. We finally got down for a shortlist of two. One was Montecito California and the other was the island of Cyprus. The reason for the island of Cyprus was it's rather
similar weather to Montecito. The food is not dissimilar to Mediterranean kind of food. They’ve got wine; they got lots of things like that. The country is divided into two parts: the Greek Cypriot part which is a recognized country, and the Turkish Cypriot part in the north which is not really recognized by anybody except Turkey. The advantage of living in the Greek part of the Island is that there is lack of Cypriots. They are flooded with tourists in the summer, mostly from northern Europe, UK, Germany, Scandinavia, places like that. In the winter, there's nobody there. What they decided to do was offer a special tax exemption to people who would be prepared to live in Cyprus for six months and one day a year, and whose income would be a foreign-sourced pension. Now, if you qualified for those things which we did, you could live in Cyprus for six months and one day a year. Your worldwideincome would have a maximum tax rate of 5%, which is not quite what happens in Montecito. Well, that was quite an interesting idea. If we had been prepared to do it, we could've lived in Cyprus for six months and one day a year and the rest of the year we could've lived in Montecito effectively for nothing because we would only be taxed in Cyprus. Anyway, after giving it due and careful thought, I decided I was too lazy to go back and forward so we settled on Montecito.
DS
I did have one last philosophical question. Have you had any thoughts of how the LEO affected computing either in Britain or elsewhere? The kind of influence or impact it had?
MG
It was very important in the early years, but soon became irrelevant just because of scale. It was the first business computer and it was amazing that somebody actually created it and it  worked and it did what it was supposed to do. And it improved business performance. All of that happened and people learnt from it, but LEO itself and the UK computer industry rapidly became irrelevant in the scope of world computing.
DS
I want to thank you very much for doing this. This interview with Mike Gifford has been recorded by the LEO Computer Society as part of an Oral History Project to document the earliest use of electronic computers in business applications. Any opinions expressed are those of the interviewee and not of the Society.

Suggested footnotes:
Page 4
Karl Popper (1902–1994): was an Austrian and British philosopher and Professor. He is generally regarded as one of the 20thcentury’s greatest philosophers of science
Page 6
Iambic pentameter: is a commonly used type of metrical in traditional English poetry and verse. The term describes the rhythm that the words establish in that line, which is measured in small groups of syllables called “feet”. The word "iambic" refers to the type of foot that is used, known as the iamb, which in English is an unstressed syllable followed by a stressed syllable. The word "pentameter" indicates that a line has five of these "feet".
Page 7
Frank Land: (born 1928) is an information systems researcher and was the first UK Professor of Information Systems. He is emeritus professor in the Department of Information Systems at the LSE. After graduating from the LSE in 1950 he joined J Lyons & Co working on the first electronic computer designed for business, the LEO I.
Page 8
English Electric: acquired the Marconi group of companies in 1946 
Sir Anthony Joseph Francic O’Reilly: (born 1936) is an Irish former businessman and international rugby player. He is a former CEO and Chairman of the H J Heinz Company
Page 11
Datamation Magazine: is a computer magazine first published between 1957 and 1998 and since then has continued publication on the Internet.
Page 16
Neil Lamming (born 1938 in Cleethorpes, UK) On graduating from Bristol University he joined LEO Computers in London as a programmer and was transferred to Australia in late 1962 soon after
LEO opened an office in Sydney. 
The English Electric (later ICL) System 4: was a mainframe computer introduced in the mid-1960s. It was derived from the RCA Spectra itself a variant of the IBM Systems 360 architecture.
Page 18
ICL (International Computers Limited): was formed in 1968 as a part of the Industrial Expansion Act of the Wilson Labour Government. ICL was an initiative of Tony Benn, the Minister of Technology, to create a British computer industry that could compete with major world manufacturers like IBM 
The Haloid Photographic Company: became what is known as the Xerox Corporation.
Page 27 The Dodd-Frank Wall Street Reform and Consumer Protection Act: better known and most often referred to as Dodd-Frank. In simple terms is a law that places major regulations on the financial industry.

Provenance :
Recording made by the LEO Computers Society as part of their ongoing oral history project.

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