Technology: What New Age?

About a decade ago, Reliance Insurance launched an ambitious office- automation project with the slogan "Paper Free in 1983." The Philadelphia-based insurer had the words emblazoned on wall posters, coffee cups, stationery and lapel buttons. It invested millions of dollars in information technology, including thousands of computers, an electronic-mail system and a brand-new telecommunications network. Managers waited for worker productivity to explode.

They're still waiting. Today Reliance is anything but paper free. Memos and forms proliferate as never before. Employees shun the computerized mail system. And productivity gains have been nil. While the company has curtailed its spending on automation, it has not abandoned its ambition. "It was not a realistic goal in 1983," concedes senior vice president Ronald Sammons, "and it isn't a realistic goal in 1993. Maybe in the year 2003."

Reliance is not alone. Since the early 1960s, when assorted gurus proclaimed the imminent arrival of the Information Age, businesses and consumers have been eagerly awaiting its coming -- and with it, the "paperless" office and the "cashless" society. Among the techno-prophets' predictions: home shopping, electronic libraries, personal computers on every desk, soaring worker productivity, uninterrupted growth. As a result, thousands of companies invested heavily in information technology in hopes of gaining a competitive edge. Other firms, including hardware manufacturers and software developers, placed equally large bets on supplying the markets for home and office automation.

Well, the Information Age is here, but it hasn't exactly lived up to its advance billing. While more people are working with their heads rather than their hands, and more than a third of the nation's $5.5 trillion GNP is generated by ideas rather than manufactured goods, white-collar productivity is no higher now than it was 30 years ago. The paperless office remains a secretary's fantasy. Paper-killing technologies like electronic mail and voice % processors go largely unused -- too complicated -- while paper-generating devices like fax machines and copiers are used to the point of abuse. As for the cashless society, most consumers have thumbed down such gee-whiz financial services as electronic banking, home shopping and debit cards.

The pot of gold at the end of the information-technology rainbow remains elusive. Citicorp has watched close to $200 million go up in smoke since 1985. Its first major information-service investment, a joint venture with McGraw- Hill to supply electronic data on prices and market activity to oil traders, flopped after a year. Earlier this year, Citi pulled the plug on a computerized information service aimed at grocery shoppers. Knight-Ridder lost about $50 million in a failed home-shopping service. And in its ambitious effort to make paper vanish, Wang Laboratories itself almost disappeared when it bet the ranch on manufacturing expensive document-scanning and imaging systems that nobody wanted. Says David Goulden, a Wang vice president: "The market's been a disappointment."