Being slow to shift strips Seer's gears.

• Author: Williams, Christopher C.
• Position: Financially-troubled Seer Technologies Inc

Seer Technologies Inc. (NASDAQ-SEER), a maker of software systems to help companies run more productively, is having a rough time running its own business. The Cary-based company reported three money-losing quarters in a row, lost its chief financial officer in July and is saddled with a stock that in late August was trading at $6.13, 68% below its 52-week high of $19 a share.

Can Seer steer its way out of this mess? It's possible, says analyst James M. Pickrel of San Francisco-based Hambrecht & Quist, lead underwriter of its initial public offering in July 1995. But it will take decisive moves to refocus marketing and shore up sagging margins.

Seer has embarked on a major restructuring - including bringing in a new CEO to replace co-founder Gene F. Bedell, who will remain on the board. Bedell says the business is strong despite revenue and profit shortfalls. But Pickrel will keep a hold rating on the stock until he sees the restructuring is working.

Things weren't always this uncertain for Seer. Created in 1990 as a spinoff of CS First Boston and IBM, it quadrupled its revenues its first four years. Backed by strong demand for its flagship product, Seer HPS - geared for large-scale information-processing applications - and with IBM as its main customer, Seer posted five straight years of record revenues and profits, cracking $100 million in revenues in fiscal 1995. More than 60% of its business comes from overseas.

Its niche, offering what's called application-development tools and software, is growing 20% to 25% a year, a bit faster than the overall software market, according to Brian Murphy, an analyst with the Yankee Group in Boston.

Seer's products are designed for companywide systems - a bank's automated-teller-machine network or a retail chain's accounting-and-tracking system. Customers include Wells Fargo Bank, Federated Department Stores and Indenska, Denmark's largest bank.

The market is competitive. Seer has to contend with capable vendors such as Oakland, Calif.-based Forte Software Inc., a $30 million company that is arguably the best-known in the field and that has a strong reputation for technological innovation. Other competitors include Berkeley, Calif.-based TCSI Inc., the leading software vendor for telecommunications companies.

Given Seer's auspicious start, it surprised analysts and investors when things unraveled in the first quarter of fiscal 1996, which ended Dec. 31. In that quarter and the next two, Seer lost $13.1...