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Newsweek Cover: 'The Next Frontiers: Companies of the Future'

PHOTO: Jan de Jong, VP of information technology at Virgin Entertainment Group, demonstrates how the MegaPlay Kiosk works

Virgin Entertainment, JetBlue, Target, Men's Wearhouse Are 'Companies of the Future:' Using Technology in Innovative Ways to Improve Efficiency and Bottom  
Line

NEW YORK, April 21 /PRNewswire/ -- Virgin Entertainment, which uses IBM-designed kiosks that allow visitors in its music stores to sample 30-second snippets from a database of approximately 250,000 CDs, is just one of the many companies that are using technology to draw more customers and improve their bottom line.  Newsweek's Special Report on "Companies of the Future" profiles 11 such firms that use technology in innovative ways.  The April 29 issue (on newsstands Monday, April 22) is the first 2002 installment of "Next Frontiers" -- an ongoing series that examines how technology and inventions are changing the way we live and work.

(Photo:  www.newscom.com/cgi-bin/prnh/20020421/NYSU004 )  

"The biggest problem we have as a music retailer is that we sell a product that is shrink wrapped.  You can look at it, smell it, and see it, but not hear it," says Jan de Jong, Virgin Entertainment vice president for information technology.  He says the company has about 15 kiosks in four stores, and plans to have kiosks in every one of its 22 outlets in North America by the end of next year.

Some of the other companies profiled include clothing store Men's Wearhouse, which has spent close to $10 million creating its own transaction-quickening technology to make buying suits as quick and painless as possible;  Target, which is using paperless coupons in the form of a smart card which allows customers to download the savings at home and redeem the electronic discount at their local store; JetBlue Airways, which uses reservation agents who work from the comfort of their home, making for a low-cost structure and a happy workforce; and Beth Israel Deaconess Medical Center, which invented the "electronic dashboard," a four-foot-wide color-coded wireless plasma display that helps hospital ERs improve the way they keep track of patients.  The board has helped reduce the chance of medical errors, and frees up personnel to do their jobs of treating patients, instead of looking for paperwork.

And "old" technology is still evolving.  While it might not seem as cool as WiFi or Java, it's clear that many of the machines that are transforming the way companies do business owe much to technology that debuted during the Reagan era, and not the Internet Age, reports National Correspondent Daniel McGinn.  Individually, some of the technologies being used by companies today to improve costs and efficiency have been around for at least a decade.  Put together creatively, the technology has resulted in higher sales and lower labor costs for some companies.

Kmart is just one example, writes McGinn.  The company says 44 percent of its sales are now transacted without a cashier, thanks to technology that enables consumers to check themselves out.  "As customers we're all so frustrated when we see 30 checkout lanes and only six are open," says Mike Webster, general manager of the NCR division that sells the FastLane system. He hopes his $20,000 to $30,000 machines will render that feeling obsolete. Self-checkout machines can also be found at Wal-Marts and Home Depots.

The Newsweek Next Frontiers Special Report is the culmination of a three-week interactive program that began with a survey posted on www.Newsweek.MSNBC.com asking the public what it thinks the workplace will be like in the future and how technology will change it.  The survey received more than 17,000 responses in three days.  The results showed that the majority believes we'll still be working in offices, but only half the time.  The rest of the work week will be spent in a home office, the survey showed.

The second week brought in technology business executives and experts and Labor Secretary Elaine Chao for a live online forum, moderated by Newsweek.MSNBC.com Editor and General Manager Michael Rogers.  Participants include MIT Media Lab director Michael Schrage, business writer Tom Peters and top corporate executives. "This is really a fairly innovative use of the Web, combining elements of bulletin boards, live talks, chat, polling and extensive editorial oversight," Rogers said.  The live forum was held April 15-18, and an excerpt of that discussion is available in the current issue.

(Articles attached.  Read Newsweek's news releases at  

www.Newsweek.MSNBC.com. Click "Pressroom.")

I'll Help Myself  

Companies are always looking just over the horizon for the next great   innovation. But often the best ideas come from a smart new spin on devices   that are right under our noses -- like checkout scanners and magnetic-card  readers -- that can change many routines of life. Think of it as the lagging  
edge of technology.

By Daniel McGinn

It's fun to gee-whiz over new technology, to "Wow!" at the latest gizmos and to dream of devices that never were and ask, "Why not?" Our affection for futurist gear fuels our love of science fiction (think we'll ever have a transporter room like Kirk and Spock?) and can shower wealth on inventors and investors. But in a world where that $400 Palm you bought last fall is so five minutes ago, let's take a breath and celebrate something that feels terribly unsexy: older technology. It's not as cool as Wi-Fi or Java, but spend time in stores and on factory floors, and it's clear that many of the machines that are transforming the way companies do business owe much to technology that debuted during the Reagan era, not the Internet Age.

Just step into the Big Kmart in Braintree, Mass. During peak times, cashiers used to work all the store's 18 checkout aisles. But since September, customers have been able to check themselves out in four lanes that use scan-it-yourself machines. Manager Daniel Ferrie says 44 percent of his store's sales are now handled without a cashier. Kmart hopes the quicker service will help its 1,000 stores using the technology steal sales from convenience stores like the nearby 7-Eleven. "The whole point is convenience for the customer, to push more merchandise through," Ferrie says. Although he hasn't cut back on cashiers, it's no secret where the trend line is heading. Higher sales, lower labor costs: listen closely, and you may hear the U.S. productivity rate ratchet a notch higher.

Self-checkout machines -- which after a few years of testing, made their biggest leap into supermarkets, Wal-Marts and Home Depots in the past year -- are often disorienting the first time a shopper encounters one. But beneath the nifty facade lies a bunch of technologies that are decidedly old-school. Its main components -- a scanner, a scale, a touch screen, a cash accepter/dispenser and a credit-card reader -- have been around for at least a decade. Mike Webster, general manager of the NCR division that sells the FastLane self-scanner, admits there was no silver bullet that allowed NCR and its competitors to pull these elements together into a single unit. Instead, the big breakthrough came in a creative idea -- can't any schmo scan a loaf of bread? -- followed by small refinements to make these disparate elements work together faster, more seamlessly, and without taking up too much floor space. Webster sees his product as an elegant solution to a simple problem. "As customers we're all so frustrated when we see 30 checkout lanes and only six are open," he says. He hopes his $20,000 to $30,000 machines will render that feeling obsolete.

That it takes managers a long time to fully utilize new technology shouldn't be surprising. Economists have been studying this ineptness among businesses for decades. They dubbed it the "productivity paradox," and it's often summarized by a quote from Nobel laureate Robert Solow: "We see computers everywhere except in productivity statistics." He's describing how, even as companies spent billions on technology during the 1970s and 1980s, researchers were unable to find any link between those investments and higher revenues, more productive employees or a higher stock price. It appeared IT was a black hole, and it wasn't clear whether these investments would ever pay a return.

By the mid-1990s researchers began to find the first evidence that companies were finally seeing a payoff, says Harvard Business School professor Andrew McAfee. Managers had rethought their businesses to make better use of the increasingly pervasive technology. It's a slow process: research showed that it often took seven years from the time a company began installing a high-tech innovation -- like a fancy database that disburses customer information throughout a company -- to the time it began to pay dividends. And it's not just computers or software, says McAfee, who notes there was a 20-year lag from the invention of the steam engine to the real start of the Industrial Revolution. "These things take time," he says.

One example of this circuitous route is every shopper's favorite device: the automated teller machine. When the first ATMs rolled out in the early 1970s, they were a technological breakthrough; the magnetic-card reader had been invented only a few years earlier. But despite heady talk of a soon-to-come tellerless era, it took many years for banks to turn ATMs into a competitive advantage, says consultant George Albright of Speer & Associates. Banks placed the first ATMs inside branches, eliminating their best feature (24/7 access); once inside, customers went straight to tellers. By the late 1980s banks had begun placing ATMs in off-site locations -- in supermarkets or malls -- and charging fees for their usage, turning them into profit centers. But labor-cost reductions have proved elusive, partly because even today, 15 percent of customers still don't use ATMs, Albright figures. Why did it take banks so long to make this device work to their advantage? Don't blame the technology. "From a marketing perspective, bankers just didn't see the possibilities," Albright says.

The same slow cycle has played out at gas stations. There's nothing terribly challenging about pumping gas; that's why a few gas stations began experimenting with self-service refueling in the late 1940s. Despite the huge potential in labor savings, it proved slow going. "For years this industry never believed that women would get out of their car and pump gas," says Roger Dreyer, president of the Ohio Petroleum Marketers Association. It took more than 20 years for self-service gas to catch on, and by the 1980s the gasoline companies had another potential breakthrough: computerized "pay at the pump" systems that would let folks use credit cards to buy gasoline without ever entering the gas station's office. That technology worked just fine, but gas companies proceeded very slowly. After all, if people could avoid going inside, they wouldn't buy the coffee, cigarettes and gum that are key to many stations' profits. Even so, Mobil -- now Exxon-Mobil -- plunged ahead, and sales inside its stores actually increased as shorter lines made more people willing to shop. "It drove more business into the store -- who knew?" says ExxonMobil executive Mike Goldberg. But the slow rollout meant the devices didn't fully catch on until the mid-'90s.

Emboldened by that success, Mobil moved more quickly on its next low-tech/high-tech gambit. Since World War II, planes have used a technology called radio-frequency identification devices so radar could recognize them. In the mid-1990s Mobil tried putting a small RFID tag on a key chain, hooking the tag into its central billing computer and letting customers wave their keys in front of pumps to pay, instead of fumbling in purses or wallets for a credit card. Launched nationally in 1997, the Speedpass system cut the average 3.5-minute transaction by 30 seconds. Speedpass customers, driven by the convenience, began spending 20 percent more at Mobil; today 5.5 million people use Speedpass, and it accounts for nearly 20 percent of the company's gas sales. "The technology itself had probably been around a decade or a couple of decades," says Joe Giordano, who invented the system. But harnessing it in a new way helped spur sales, and ExxonMobil is cutting deals with McDonald's, supermarkets and pharmacies to let customers pay with a key chain in their stores (debiting a checking account or credit card), too. The goal, says Goldberg: "To make it ubiquitous."

None of these examples suggests that more cutting-edge innovations -- wireless PDAs, Web-browsing mobile phones, "data mining" software -- won't play a role in helping 21st-century businesses squeeze more sales out of fewer resources. Instead, they demonstrate why managers should think of many of yesterday's innovations like a cream-puff used car: an underappreciated asset with a lot of miles left in it.

Next Frontiers

Glitzy tech firms in Silicon Valley tend to get all the attention. But away from that spotlight, all sorts of companies -- from a winery in Oregon to a car-seat maker in Detroit to a start-up airline in New York -- are using technology to push ahead in business, transform their industries and change our lives.

Millions of people work at home each day, but few have a better view from their office window than Jill Smith. In the distance are the snow-topped peaks of Utah's Wasatch Front. But Smith is more taken by beauty of a different kind: the sight of her four kids playing in the cul-de-sac out front. It's just one of the many perks she enjoys as a home-based reservation agent for JetBlue Airways. "You don't have to buy lunch, pay for day care or buy new work clothes," says Smith, 37. "It's perfect."

In the global, wired economy, it's hardly unusual for companies to set up reservation offices or telephone help desks in far-flung cities, even foreign countries. But JetBlue, based at New York's Kennedy airport, is unusual in its commitment: its entire force of 550 reservation agents work from the comfort of their own homes, all around Salt Lake City. Why there? David Neeleman, JetBlue's founder, had previously run Morris Air from the area until it was sold to Southwest Airlines in 1993. Neeleman promised his agents jobs if he ever started a new airline. JetBlue, which started flying in February 2000, gives its home workers a computer, but requires them to pay about $45 a month for two phone lines to handle calls and dial into the booking system. "It's a small price," says Smith, who makes reservations 25 hours a week in her slippers. (She makes about $9 an hour; starting pay is $7.75.) JetBlue doesn't fuss about a dress code, but insists that callers not be treated to the sounds of domestic bliss, like crying kids. Supervisors monitor calls occasionally to make sure that all a customer hears is a friendly voice and a clicking keyboard.

The savings from running a home-based reservation center helped the airline report its first profit a mere six months after its first flight. A low cost structure is key to its goal of replicating the runaway success of Southwest. Among smaller, low-fare carriers -- including Frontier, Spirit and AirTran -- JetBlue wins the low-cost derby. Investors like its chances. The airline went public two weeks ago in the year's hottest initial stock offering, with shares rising from $27 to $45. Neeleman says that JetBlue saves 20 percent per flight booked by using home agents instead of a call center (another bonus: happy workers mean a low turnover rate of about 10 percent). "It's so valuable," Neeleman says. Adds aviation consultant Stuart Klaskin: "The home reservation system is an integral example of Neeleman's out-of-the-box thinking."

Another example of that thinking: Neeleman gives all JetBlue pilots and technicians a laptop computer so they can get procedure changes online from the FAA. That way, there's no chance they'll miss a memo -- the first step to making sure the airline is never fined for an infraction or grounded altogether. Neeleman expects more, of course. He's banking on steady and strong growth from his fledgling airline -- the same kind of growth that JetBlue's reservation agents in Salt Lake expect to see every day from their kids.

Bret Begun

WILLAKENZIE ESTATE  

A Big Step Forward For an Ancient Art  

Bernie Lacroute knows a thing or two about technology. At Digital Equipment, he helped develop the Ethernet and VAX. At Sun Microsystems, he was second in command during its growth spurt. But after he made his fortune and semiretired more than 10 years ago, the native of Burgundy decided to pursue his love of the pinot family of grapes, and opened the WillaKenzie Estate winery in Yamhill, Ore.

Wine making is an ancient art, but Lacroute didn't cork up his innovative impulses. He trained his eye on the way wineries mix the juice of grapes in tanks during fermentation with the "cap" of skins and seeds on the surface. The cap, which can be as thick as 12 inches, contains the tannins that give wine its color and flavor. The most gentle method of extracting tannins is the foot stomp (think "I Love Lucy" reruns), but most wineries use handheld "jackhammer" devices. Lacroute worried that the machines were much too rough on his grapes, and longed for a kinder, gentler way. "I knew we could do one better," says Lacroute.

His solution: Big Foot, a 1,000-pound, pneumatically controlled, microprocessor-driven grape stomper. Big Foot and its three stainless feet move on a rail system above a dozen tanks, stomping each tank for about 20 minutes, two to three times a day, for about two weeks. "It's so perfect because these plunges are gentle and replicable, whether it's 7 in the morning or 10 at night," says Laurent Montalieu, the head wine maker. Lacroute won't patent Big Foot, preferring to give the specs away. The device is used in wineries in Washington, California and New Zealand.

The real payoff of Big Foot's work is in the bottle, and WillaKenzie has won many accolades from wine connoisseurs as it's quadrupled in size over the past six years to 15,000 cases of wine annually. So Lacroute says it's now time to kick back. "I'm from Burgundy and I don't play golf," he says. "What I do is drink wine." That is, until the spirit moves him to invent something else.

Joan Raymond

MEN'S WEARHOUSE  

Thank You, We're Done, Please Come Back Soon  

The Men's Wearhouse recognizes that most men hate to shop. So the company has done everything it can to make buying clothes as quick as a commercial break during "Monday Night Football."

It's a huge bet. The company recently spent almost $10 million on tailor-made software for touch-screen registers to shave minutes off the time it takes to help customers. If one store is out of stock of a particular jacket size, for example, there's no need to call around -- the system provides instant access to the inventory of every one of the chain's 600 stores. If a customer needs directions to another store, an employee can immediately link to Mapquest on the Internet. Questions about Jones of New York suits? Employees can simply visit its Web site to find answers to any question customers might throw their way. "We wanted to make their experience as painless and informative as possible," says Jeff Marshall, the company's chief information officer and architect of the system.

The most unusual time-saving feature of the new registers is a fingerprint scanner that lets managers make returns and exchanges more swiftly because the computer instantly recognizes them. With the old system, employees had to go through several screens and passwords to handle returns. The fingerprint scanners also help the chain cut down on losses from theft. "I know who is in the register, when they were in it and what transactions took place when they were in it," says Marshall.

Industry experts say Men's Wearhouse's homegrown approach to technology is unusual. "Most retailers are users, not creators," says Cathy Hotka, vice president for information technology at the National Retail Federation. "They saw a different reality and they went out and created the technology to support it."

Because the system is only six months old, it's hard for the company to measure whether it's translating directly to more sales. Besides, guys generally aren't known for communicating their feelings about a shopping experience, other than saying "Are we done yet?" But if the answer to that question is a quicker "yes," that could buy Men's Wearhouse a lot of loyal customers.

Suzanne Smalley

GREENPOINT MORTGAGE FUNDING, LLC  

Appraise This: A Faster Way to Buy a Home  

You know the drill. You're in the middle of buying or selling a home, and it's time to schedule the appraisal. Suddenly, your stress meter, already humming, starts peaking. Appraisers, after all, can undermine a deal by scaring away lenders if they decide that the home you so desperately want to buy or sell is overpriced. It's a privilege for which you can pay $300 or more. In a busy market, even getting an appraiser to show up can take weeks, adding to the anxiety.

Now a new computer tool is quickly gaining popularity in the real-estate business that lets you worry less about appraisals and more about ripping down that ugly wallpaper. It's called automated valuation modeling (AVM), and it basically does for homes what credit scoring has done for people: it reduces them to a number that lenders can use to make snap judgments. Banks have spent years building databases of old appraisals and comparable sale prices in different neighborhoods and regions, and can now apply complex formulas to all that data to determine in minutes whether a property is priced right. No appraisers needed. Time saved. Money saved.

Greenpoint Mortgage is among the early adopters of AVM. It loaned out a record $26 billion in mortgages last year, and has raised its share of the mortgage market in two years from 0.8 percent to 1.3 percent, thanks in part to the appeal of computer tools like AVM, which lowers the cost of an appraisal to $50 and can be done in a day. "This is a really competitive market, and it makes a huge difference to be able to process more loans quickly," says company president S. A. Ibrahim. He expects that in two to five years his company will be able to give near-instant answers on mortgages to some borrowers.

Mortgage heavyweights Freddie Mac and Fannie Mae started using AVM a few years ago with tentative steps. They've been using it to approve less risky loans, such as refinancings, small second mortgages and loans to borrowers who boast enviable credit ratings and are planning to plunk down hefty down payments. "The models have gotten better and better," says Peter Maselli, a senior vice president at Freddie Mac. Now if only somebody could invent a computer program that will help pack and unpack all those moving boxes.

Linda Stern

VIRGIN ENTERTAINMENT, NORTH AMERICA  

Road Test: Taking the Music for a Quick Spin  

It's not easy for brick-and-mortar music retailers these days. More people are downloading free music from the Internet. Online music sellers are slashing prices, eating into profits. Business is particularly difficult for enormous music outlets like the Virgin Megastores that devote tons of floor space to obscure recordings by world musicians. How can Virgin hope to sell enough of these eclectic tunes to turn a decent profit?

Virgin may have found an answer. Jan de Jong, the company's vice president for information technology, persuaded his bosses to try out electronic kiosks in Virgin's stores that allow customers to sample 30-second snippets from a database of approximately 250,000 CDs. The experiment began last year in two of the chain's outlets and was considered a huge success. Virgin executives found that when customers come into a store with a specific album in mind, they're three times as likely to actually purchase the product if they give it a test drive. "The biggest problem we have as a music retailer is that we sell a product that is shrink-wrapped," says de Jong. "You can look at it, smell it and see it, but not hear it." The company now has about 15 of the $5,000 kiosks in each of four stores, and plans to install them in every one of its 22 outlets in the United States and Canada by next year.

The kiosks also help customers help themselves, a big advantage considering the enormous size of Virgin's music stores, which average about 60,000 square feet. "Retailers can no longer hire enough people to keep the store open, much less to understand all of the different styles, from Celtic to rap," says Dan Hopping, one of the IBM retail specialists who helped design the technology. "The kiosk is always on and is always an expert." In addition to track sampling, the kiosks provide reviews from industry magazines like Spin, Vibe, Mix Mag and Rolling Stone, as well as pictures of the artists, track listings and album credits.

The music is streamed into the kiosks via the Internet by a database company called Muze. Some Internet companies allow customers to download songs, but few offer the depth of selection that Virgin boasts. At Amazon.com, for example, you can sample only 15,000 songs, just 6 percent of the total available at a Virgin store kiosk. The process is simple, too. Customers scan a CD's bar code and tap the touch screen to choose the song snippets they want to hear. Susie Phillips, 31, was wearing out the kiosks recently at the Virgin Megastore in New York's Times Square. "I was like, 'Woo-hoo!' when I saw it. These are artists that I know, but albums that I'm not familiar with, and I don't want to spend 80 bucks without hearing it," said Phillips, waving the four CDs she was thinking of buying. "It's instant gratification." For Virgin executives, the instant gratification comes when customers like Phillips head to the checkout line.

Suzanne Smalley

RIVERDALE MILLS  

Good Lobster Traps Make Good Fences  

Riverdale Mills made its name by building a better lobster trap. But since September 11, the small Massachusetts company has become better known for its security fences. Using the same plastic-coated wire mesh found on its lobster traps, Riverdale came up with a fence with such tiny openings that it is virtually impossible to scale or cut. Its WireWall already rings many American prisons and protects Kuwait's border with Iraq. After the terrorist attacks, governments and companies around the world clamored to protect themselves with Riverdale's fence, driving up sales roughly tenfold. "Nobody uses wooden lobster traps anymore," brags Jim Knott, Riverdale's salty 72-year-old founder. "And nobody's going to be using chain-link fences for security anymore, either."

Trapping seafood and making fences are hardly the type of businesses typically associated with cutting-edge technology. But for 24 years, Knott has outfitted his old paper mill with high-tech machinery that can spit out 400,000 lobster traps and miles of fencing a year. Knott's lobster traps now control 90 percent of the market. And his business employs more than 100 workers and does over $20 million in annual sales. "What we've done has never been very flashy," he says. "But it's always worked and we've always found a way to make it better."

Before Knott came along, fishermen caught lobsters the same way they had for centuries -- with wooden traps. But while toiling at a New England company making plastic stethoscope tubes in the 1950s, Knott came up with an idea for a new way to make lobster traps, based on the same method stethoscope tubes were formed -- by dipping metal wires into plastic. Knott, who caught lobsters as a child growing up in Gloucester, Mass., figured that plastic-coated wire mesh would make a more durable lobster trap than wood, which rots in salt water. But for the next two decades, Knott was unable to persuade a company to back his idea. So in 1978, he borrowed money, bought a dilapidated mill and invested in new machinery to crank out lobster traps.

At first Knott couldn't even give away his newfangled traps. "Lobster fishermen aren't real quick to change," he says. Finally Knott's traps caught on after he persuaded the best fishermen in the area, known as the highliners, to give them a try. To make new-age lobster traps, Knott designed the production line to use automatic welders to make the wire mesh and galvanize and coat the trap with plastic. Now that WireWall has become his hottest product, Knott's spending big to boost production. In December, he installed a $2 million welder that churns out 10-foot-wide ribbons of fencing. And now he's putting a 126,000-square-foot addition on his old mill. Knott isn't worried about expanding in an uncertain economy. These days, security and seafood are growth businesses.

Patrick Crowley

PIXAR ANIMATION STUDIOS  

Enough Pixels. Time For Comedy Class  

Exactly 2,320,413 computer-animated hairs make up the purple and blue fur covering Sully, the oversized star of the hit comedy "Monsters, Inc." Pixar Animation Studios has developed software, called Fizt, that can make each strand curl on command. But before a single lock was attached to Sully's skin, Pixar's filmmakers spent more than two years combing through the movie's script, making sure no story strand was out of place. Only then was the new software launched, and Sully brought to life. "Here, the art challenges the technology, and the technology inspires the art," says John Lasseter, the executive vice president who oversees Pixar's creative efforts.

Pixar, the maker of "A Bug's Life" and the "Toy Story" films, is undoubtedly Hollywood's highest-tech storyteller. It's also one of its most reliable hit machines, as Pixar's four films have generated an average gross of $216 million. But what really separates Pixar from the pack is that even with so many cutting-edge tools at its disposal, it moves at an Amish pace, working as many as five years on a single film, releasing a new movie only every 18 months. Distressed by early story problems on both "Toy Story 2" and "Monsters, Inc.," for example, Pixar rebooted with new scripts.

Hitching 21st-century technology to old-fashioned storytelling has often been a messy marriage: more pixels than plot leaves you with "Final Fantasy," a computer-generated sci-fi dud released last year. To make sure technology is not Pixar's driving force, Pixar is pushing programmers harder than ever, and also encouraging them to abandon their workstations to study sculpting, figure drawing, screenwriting and improvisational comedy. Pixar's light-filled offices were designed to force employees to mingle, even on their way to the restroom. It's part of a strategy aimed at breaking down walls, even within job duties. "No one is saying 'Just shut up and do your job'," says Pete Docter, the director of :Monsters." The design of one of Docter's "Monsters" creatures, for instance, was hatched by software developers writing new computer language to animate fur.

With such success, you might think all the competing studios would have plundered Pixar like an unguarded vault -- which, technically, it is, since unlike at every other studio nobody besides Lasseter works under contract. So far everyone is staying put. "A piece of paper won't keep them here," Lasseter says. "You want their heart here. So you make them creatively satisfied." As is Pixar's audience.

John Horn

LEAR CORP.

Testing Data by the Seat of Your Pants  

The test lab of car-seat maker Lear Corp. is like something from a Woody Allen science-fiction movie. Giant robotic arms with plastic attachments representing human buttocks repeatedly swivel on and off seats, testing their durability. In another area of the lab, college kids, housewives and senior citizens rest their rumps on car seats covered with sensors, as nearby Lear researchers scrutinize computer images of the testers' cheeks that look like Doppler weather maps. For their expert opinions on Lear's designs, the testers get $25 per car and the pride in knowing they've left a lasting imprint on the world's car seats. "Comfort in a seat is a high priority for me," boasts Tracy Merlo, a 43-year-old homemaker from Livonia, Mich., who's been testing Lear's seats for four04/21/2002 13:09 EDT