We were engineers, physicists, mathematicians

As a co-founder of Paranor, Max Räz is one of the pioneers of today’s IT landscape. What sort of technology was available 40 years ago? Back then, what did people thing the future of hardware and software would look like? Which developments were particularly formative? Max Räz answered these questions and others in our major interview.

Max, the success story of Paranor started with you. Can you remember back to the early days?
It didn’t start out as a success story – the early days were tough. We – the founders of Paranor – had previously worked at a different company as software developers. In addition to the industrial systems, the sales people at this company also offered software – regularly at impossible turnaround times and conditions. After a few years in which we were forced to chase money and deadlines, we decided to set up Paranor so that we could develop really good software under good conditions.

We did not yet have a customer base and had to go out and find customers, so money was tight. Over time though, we gradually got enough projects – and thanks to the efforts and commitment of our employees we were able to really impress our customers.

What were the dynamics like then, in the still-young IT industry?
It was a different world. Computer science had really only just arrived at universities just before Paranor was founded. We were engineers, physicists, mathematicians. There was very little in the way of standard software – Assembler, Fortran and Cobol were the standard languages. We used to save data with software we wrote ourselves. There were no development processes. Everything was still yet to be invented, and we felt like pioneers or artists, and this is how we were treated as well. Batch operations on mainframe computers and so-called real-time software were completely separate areas of computer science. Real-time software was still quite unknown. Accordingly, we looked down on the large batch data centres with a degree of disdain.

Lots of software companies came up, and most of them were for commercial software (ordering, billing, wages, warehousing, everything in batch mode). Only a few companies dared take the step into the real-time area, so this was our opportunity.

At the time there was no Internet, no e-mail, communications via telephone lines were limited to 1200 bps, printers were a constant annoyance (spherical print heads, daisy wheels, ink ribbons), and we exchanged short documents via telex – mobile phones were unimaginable. Memory capacity was measured in megabytes, so it was a far cry from the gigabytes of today.

Can you still remember what the goals and future prospects were when Paranor was founded?
We wrote our business model and goals on one side of A4:

  1. Enjoy work
  2. Highly satisfied customers
  3. Real-time software only, only on DEC computers, nothing to do with Swiss Francs
  4. Always use the best tools
  5. We develop products
  6. Minimal growth, stay small

Our business model said nothing about turnover or profits.

How did it turn out?

  1. We always enjoyed the work, and we still do, particularly when it comes to challenging projects.
  2. Our customers were always very satisfied. We didn’t have many customers, but the ones we did have stayed loyal to us for a long time.
  3. And for the first 14 years we did indeed not do any projects with Swiss Francs. Then the commercial software became real-time capable – which meant it was interesting for us.
  4. Despite finances being tight, we purchased our own development computer right at the start – a DEC PDP-11 computer.
  5. We did not develop any products – instead we handled projects (customised software). This was much more exciting for us, because we wanted to remain purely an engineering company.
  6. But we haven’t stayed quite so small. In the early days we hired one additional employee each year on average, but this number increased later on. Hardly anybody left the Paranor family before they retired.

Have there been any developments in the IT landscape in recent years that took you by surprise?
Open source. We definitely never saw that one coming. But it is the right idea.

Which of the different stations along the history of Paranor were particularly formative for you?
It was an incredible, almost unreal experience when we got the big project to set up a payment transaction platform for the Swiss post office in 1992. The projects we had sold prior to this were significantly smaller – and now we had a project of this magnitude. That really did have a big impact. But there have been plenty of other wonderful moments – after all, a lot happens in 40 years!

If you could choose: would you rather set up an IT company in 1978 or 2018?
Since I love creating new things, 1978 was undoubtedly the ideal time for me. In those days we felt like pioneers. But 2018 is very exciting as well. The digital transformation is gaining momentum, the start-up scene is bustling, the technology that is available is incredible – and Paranor is right in the thick of things.