President's Letter

To Our Shareholders:

I am pleased to report that 1977 was another good year for Keane Associates Revenues were at record levels and the company added substantially to the geographic, organizational, and managerial dimensions of its business.

Revenues increased 29% to $7.323.000 Net income rose to $403000, or 50 per common share a gain of 19% per share.

Our business growth is taking place at a time of significant transition within the computer user community. New pro duct introductions by mainframe and minicomputer companies by terminal manufacturers and by peripheral equipment suppliers are making new levels of capability available at increasingly lower prices These new capabilities no encourage the continual upgrading of traditional large computer systems at central site locations, but also stimulate the spread of computer power to many now smaller and more remote locations.

This proliferation of new products has added new levels of complexity to the development and management of information systems networks. The ability to design user applications within these complexities has been a major factor in the growing demand for Keane's services.

Information Services 

More than 70% of Keane's revenues come from our Information Services Group. This group does the systems design programming, testing and implementation of computer application is for client companies.

With an expanded staff broadened geographic market coverage, and in creased client demand, the information Services Group produced record results in 1977 New offices were opened in Manchester, New Hampshire and Chicago, Illinois. Our year old Washing ton, DC office became profitable for the first time Keane personnel were assigned for the first time to projects in the Southwest and on the West Coast and are scheduled in 1978 to work in Europe, Japan and the Mideast as well a reflection of our steadily expanding reputation and an indication of the world wide reach of client information systems.

Advisory Services 

The Advisory Services Group, which counsels clients on the most effective techniques for managing and improving computer operations was expanded

substantially during the years accommodate demand for its two principal consulting services-Productivity Management and Machine Management.

In 1977, more than 950 executives from 160 client firms were trained in Keane's unique Productivity Management technique. Productivity Management is a well defined method of controlling and directing the personnel resources and environmental factors that influence the outcome of major computer systems development efforts in existence for nearly two years. Productivity Management usage has already saved millions of dollars significant time and many potentially misdirected systems efforts by client organizations.

Machine Management is our newest Consulting service. It is a method of m proving the efficiency with which computer users configure their computer hardware and software incorrect attachment of disk storage systems improper selection of operating system software of poor assignment of peripheral equipment to equipment data channels may for example severely impair the operational throughout of expensive computers.

 The Machine Management service can in many cases help clients measure monitor and improve their equipment's productivity by 30 per cent or more. We anticipate major expansion of this new capability in 1978.

Facilities Management Services

Our KeaMed organization represents the combination of many Keane resources into a cohesive entity that focuses on providing a total range of services to a single market area-hospitals. 

The KeaMed package of services includes computer management, systems design programming, applications implementation, advisory services and the operation of computer equipment for our hospital clients. This packaged service called facilities management has made Keane Associates one of the largest computer services supplier to hospitals in the Northeast Most facilities management contracts s maintained by KeaMed are for periods of five years.

KeaMed enjoyed record performance in 1977, with nine new hospitals being added to the company's facilities management services in the New York area and one new hospital being added to KeaMed operations in New England.

Business Development

During the year, the company sold back its interest in Chervenak, Keane & Company to Larry Chervenak, The operations of this company were not as complementary to our business as originally anticipated in October, Keane entered into an agreement in principle to acquire Neoterics, a computer service firm with offices in Cleveland and Columbus, Ohio, Pittsburgh, Pennsylvania and Raleigh, North Carolina. The successful culmination of this acquisition would increase the density of our coverage in an area that accounts for 60% of the computer population in the United States.

We enter 1978 with an excellent staff a sound management structure, a healthy economy and a substantial need for the services we offer. The year promises to be another good year.

John F. Keane 


March 24, 1978

Annual Report

1977 Annual Report

Key Information

Keane Associates Inc, is traded on the Boston Stock Exchange under the symbol KEA