(FORTUNE Magazine) – WITH HIS deep-throated Nixonian baritone, Charles W. Moritz, chairman and chief executive of Dun & Bradstreet, likes to note the importance of tradition at the 144-year-old company. Yet he is changing the face of the business information giant. In a mere 18 months, Dun & Bradstreet has sold its TV broadcasting and book-publishing properties, while investing $1.8 billion in a breathtaking 33 acquisitions and dozens of internal development projects. The company is debt-free and has $650 million in cash and marketable securities in the till. Deciding how to invest that money is the biggest challenge Dun & Bradstreet faces. Moritz won't say where or when his next move will come, but his strategy is clear. He has devised a two-pronged expansion plan to make Dun & Bradstreet the world's leading provider of what he calls ''products and services that help business people do their job.'' First, he is sinking the proceeds from divestitures into high-growth acquisitions in the U.S. and Europe. Second, he is spending millions to squeeze more profits out of a private treasure trove of facts and figures -- databases, in computer lingo. Dun & Bradstreet Credit Services, for example, tracks the credit history of seven million businesses. Donnelley Marketing, the company's direct mail operation, keeps current addresses and other data on 75 million U.S. households. Through computer technology Dun & Bradstreet is transforming these proprietary databases into a stream of new information products tailored to the varying needs of millions of disparate customers. Moritz is moving at a time of intense interest in the ''information industry.'' The exact nature of this industry is frustratingly fuzzy. Until recently it was the domain of traditional media companies: magazine, newspaper, and book publishers, and TV and radio broadcasters. Now the definition is expanding to include the business of selling computer-generated data and data services that massage the information. Scores of companies have claimed turf in the information industry. They range from data network operators to telephone service providers to banks. GE Information Services, a division of General Electric, says it is an information industry leader because it operates the world's largest private telecommunications network. AT&T and its seven offspring all see themselves as information industry powerhouses. Claiming to be a player, Citicorp says, ''Information about money has become almost as important as money itself.'' Publishers and broadcasters also insist they can grab pieces of the market for computerized data. Yet security analysts regard Dun & Bradstreet and other compilers of business statistics like Dow Jones (owner of the Wall Street Journal) and McGraw-Hill (owner of Standard & Poor's) as the purest, most attractive information industry plays. Beginning a decade ago, these companies computerized their records, partly to control internal costs. They have since realized that widespread use of remote terminals and personal computers equipped to receive data from mainframes has created a vast new market for electronically generated information. Dun & Bradstreet's profits have been superb. They're down for the last four quarters, but that's mainly because nonrecurring gains on the sale of properties had pumped up profits the year before. Dun & Bradstreet's three main operating divisions -- business information services, publishing, and marketing services -- all chalked up record operating revenue and income last year. And the company ranked 23rd in return on shareholders' equity on FORTUNE's directory of the 500 largest U.S. service corporations; over the past ten years, return on equity has averaged more than 25%. Wall Street investment firms widely recommend the stock, even though it recently hit a record high and is selling at more than 20 times earnings. ''If somebody wanted to take over Dun & Bradstreet he might have to pay 40 times earnings, and it might still be a good deal,'' says Victoria A. Butcher, who follows the company for the New York brokerage firm of F. Eberstadt & Co. Chairman Moritz, 48, and President Robert E. Weissman, 44, took over in January. ''They are very different individuals, and each is making a major * contribution,'' says Harvard economics professor John R. Meyer, a Dun & Bradstreet director since 1961. Moritz, who has a marketing background, began his career as an account executive at Reuben H. Donnelley, acquired by Dun & Bradstreet in 1961 and now the largest publisher of Yellow Pages other than the telephone companies. ''I've always been conscious of the needs of the customer,'' he says. ''When people come to me with a new business proposal, I tell them, 'Put it in terms a customer can relate to.' '' Weissman, who is chief operating officer, is an admitted ''techie.'' He hacks away at the personal computer in his office, compiling private databases on everything from jokes and Christmas card addresses to a shopping list of compact audio disks. In 1983 Moritz, Weissman, and ten senior managers drafted a 28-page corporate strategy statement that laid out Dun & Bradstreet's new policy on acquisitions and internal development. Moritz carries a copy in his briefcase at all times. Although he won't let outsiders see the document, Moritz says, ''The word 'customer' is the most frequent word in there.'' The statement was approved by his predecessor, Harrington Drake, in late 1983. The effects soon rippled through the Dun & Bradstreet empire. In January 1984 the company sold Funk & Wagnalls, a publisher whose reference books retail in supermarkets. Dun & Bradstreet says Funk & Wagnalls failed to meet objectives for profitability and growth. Four days later the company completed the sale of Corinthian Broadcasting Corp., which owns six TV stations, to Dallas-based A.H. Belo for $606 million. The problem there wasn't lack of profits or growth. With 1983 earnings of $47.2 million on revenues of $100.6 million, says Moritz, ''Corinthian was a hell of a good business, but we saw it was going to require a whole set of management skills that we weren't really that good at.''

Dun & Bradstreet has done plenty to offset the divestitures. It made 23 acquisitions in 1984, and ten this year. The best known are Datastream, a British investment analysis firm, and the U.S. division of Britain's Thomas Cook travel agency. Others include market research and insurance services companies, specialty software developers, six more publishers of Yellow Pages, and technical magazines. Many are cash-hungry businesses growing 30% to 50% annually. INTERNAL DEVELOPMENT projects got an infusion of $140 million. The databases range from Credit Services and Donnelley Marketing to Moody's Investors Service, which publishes corporate financial profiles, and Official Airline Guides, which sells up-to-date airline schedules to travel agents and companies. Research expenditures, mostly on computer software to manipulate these data, increased more than 30% last year. ''We've been able to take an existing database, reformat it, spin it around, and develop a whole slew of new products for our customers,'' explains Moritz. Ten years ago, Dun & Bradstreet credit reports were as uniform as Model T Fords. Today they challenge Heinz for variety. Dun & Bradstreet can tailor products to specific customers. The company can electronically comb the credit information database and generate reports on individual companies or industry groups. Topics range from a firm's bill payment history to the number of contracts it has with federal agencies. ''Gillette's razors help it sell more blades,'' says James E. Rutter, an executive vice president who runs Dun & Bradstreet Credit Services. ''Our software is the conduit for more data.'' Take, for instance, Donnelley Marketing. Its database of consumers -- gleaned from census tracts, telephone listings, auto registrations, and other public sources -- grew out of its direct mail business, which distributes grocery coupons to households. Moritz explains how he thought about expanding the business: ''As long as we viewed this as a mailing list, we were putting blinders on. We asked what would happen if we said, 'This is the most extensive consumer database that exists. One of the things you can do with it is create a mailing list. What other things can you do with it?' '' The answer became a new division of Dun & Bradstreet: Donnelley Marketing Information Service, which provides demographic reports for market researchers. New products range from consumer spending profiles, organized according to census tracts or zip codes, to services that help retailers and fast-food chains find promising sites for outlets. Dun & Bradstreet is investing heavily in information delivery systems. Last year the company sent more than half its credit reports electronically, vs. zero in 1978. Customers can call a DunsDial operator for a report, or get it transmitted by DunSprint to remote terminals connected to mainframe computers, or by DunsPlus to personal computers, or by DunsVoice to TouchTone telephones. The DunsVoice system sends voice messages prerecorded by an actress fondly referred to as Joyce the Voice. Dun & Bradstreet also operates DunsNet, a $20- million private telecommunications network completed in March, which connects customers in 155 cities directly to the company's mainframes. Electronic delivery systems are expensive, says George J. Feeny, senior vice president for advanced development. But, he adds, ''they have high returns.'' DUN & BRADSTREET is also counting on high returns as it moves into new geographical markets. Donnelley's Yellow Pages unit has staked out territory in Florida, California, Texas, and Oklahoma. Donnelley has long been a big cash generator, but its operations were limited to the Midwest and Northeast. The breakup of AT&T turned the Yellow Pages business into a high-growth industry. Says Executive Vice President Richard B. Swank, Donnelley's head: ''Pre-1984 our opportunities for growth were zero. AT&T allocated the business to Yellow Pages vendors in every area of the country. If you wanted to expand they'd slap you down. Now we're choosing our own sandboxes.''

An even bigger sandbox lies across the Atlantic. Last fall Dun & Bradstreet opened a $40-million computer center in England to provide information products and services to European customers. ''Their timing is perfect,'' says Harvey L. Poppel of Broadview Associates, a New Jersey consulting firm that advises companies on acquisitions. ''There have been international markets for computer equipment for years, but the information content industry is only beginning to globalize.'' The company's move was timely for another reason: though it has lost some muscle recently, the strong dollar has been a boon to Dun & Bradstreet's foreign investment program. Says David A. McBride, president of Dun & Bradstreet International: ''We've been spending like crazy.'' Dun & Bradstreet spent no cash to snare its biggest prize: consumer marketing giant A.C. Nielsen & Co. Last summer's deal involved a stock transaction of 20 million Dun & Bradstreet shares, then valued at about $1.3 billion. Nielsen, the world's largest market research company, posted 1983 earnings of $50 million on revenues of $680 million. It is the leader in the television ratings business, and dominates the sale of consumer research to the marketing, sales, and advertising departments of client companies. Nielsen's Clearing House unit processes cents-off and other coupons that are redeemed by retailers, who are reimbursed by manufacturers. The unit fits nicely with Donnelley Marketing, which distributed 6.8 billion coupons and promotional offers by direct mail last year. Nielsen had admired Dun & Bradstreet. Former Nielsen chairman Henry Burk remembers: ''As far back as 1971, Art Nielsen Sr. told me, 'If I ever sell my business, it will be to Dun & Bradstreet.' '' Burk is now D&B's vice chairman. Dun & Bradstreet is known for slow, careful courtships; it spent 15 years wooing Nielsen. Some Wall Street security analysts criticize the company for being too cautious. They argue that for Dun & Bradstreet to meet its goal of growing 16% annually, it must make more acquisitions, not sit on its cash. Weissman demurs. ''I don't get up in the morning and say, 'Where do I spend cash?' '' he says. The most desirable acquisitions augment an existing line of business. Top management calls them ''tuck-unders.'' Intertwining an acquisition with the Dun & Bradstreet operation is largely an exercise in financial planning. Explains Richard F. Schmidt, executive vice president for finance and planning: ''We ask a company to prepare a business plan. We don't want warm fuzzies about the future, but a specific strategy to improve leadership position.'' The Dun & Bradstreet staff criticizes the plan, challenges the numbers, and sometimes sends it back for revision. Once approved, however, it becomes gospel. Top managers at acquired companies find the process illuminating. Frank Dodge, president of McCormack & Dodge, a software company based in Natick, Massachusetts, says it helped his firm grow 50% in each of the past two years. ''I'm not a business person by background,'' he says. ''This is a very entrepreneurial company. But we now have 1,400 employees to manage.'' Nielsen, with 23,000 employees, posed different problems. For the past few years the company's earnings have fluctuated from quarter to quarter. Security ana- lyst Butcher attributes this to management nonchalance. ''I never thought Nielsen shared Dun & Bradstreet's sense of urgency to be at the forefront of technology,'' she says. Now complacency has vanished. Nielsen is adapting the DunsPlus software to deliver information on consumer-goods sales volume, market share, pricing, distribution patterns, and inventory levels to personal computers via the DunsNet system. If a new company lives up to expectations, Dun & Bradstreet keeps hands off. ''We don't try to send lots of instructions from corporate headquarters,'' says Weissman. ''That would be like the death of a thousand cuts.'' And Dun / & Bradstreet is free with cash. It acquired Guy Murray & Smith, a Tampa, Florida, marketer and administrator of group life and health insurance policies for small businesses in 1978; since then it has bought four more companies to tuck under President Jack Murray's operation. Renamed Dun & Bradstreet Plan Services, the business is growing at better than 30% a year. The acquisitions have furnished many of Dun & Bradstreet's top executives. Moritz came aboard with Donnelley, and Weissman joined as president of National CSS, a computer time-sharing firm bought in 1979. Murray shares the go-getter spirit of many newly acquired executives. ''My friends all told me I would not fit into Dun & Bradstreet's conservative corporate culture,'' says the bearded Southerner. ''But I'm having as much fun as I ever had. If you're going to sell your company, it's neat to sell it to Dun & Bradstreet. You can brag about it to your cousins back in West Virginia.'' Dun & Bradstreet is not bragging about all its acquisitions. Last year it wrote off $47 million when it began to phase out Weissman's old time-sharing business. ''The problem with time sharing was that too much of its value-added was shared access to computer power,'' says Weissman. ''With PCs, that power is in the hands of the customer.'' Another potential victim of technological change is Dun & Bradstreet's Official Airline Guides division. For the past few years, United and American airlines have been selling computerized reservation systems to travel agencies and corporations. These systems display schedules on computer screens and let the user make reservations electronically, lessening the need for Dun & Bradstreet's service. Dun & Bradstreet moved aggressively to defend the division in March, when it purchased Thomas Cook for an undisclosed price. Now that it has Cook's ticket- selling capability, Dun & Bradstreet is putting together a system similar to the airlines', which it wants to sell primarily to companies. The move could pay off. Travel agents, corporate clients, and competing airlines criticize the United and American systems for giving preference to their own flights. Now, says Airline Guides President James Woodward, ''We'll be able to book reservations for travelers so that they'll have an unbiased selection of flights and fares. I think we have a unique opportunity.'' Such opportunities crop up regularly at Dun & Bradstreet. BOX: INVESTOR'S SNAPSHOT DUN & BRADSTREET SALES (LATEST FOUR QUARTERS) $2.5 BILLION CHANGE FROM YEAR EARLIER UP 16% NET PROFIT $268.1 MILLION CHANGE DOWN 44% RETURN ON COMMON STOCKHOLDERS' EQUITY 20% FIVE-YEAR AVERAGE 30% RECENT SHARE PRICE $79.75 PRICE/EARNINGS MULTIPLE 23 TOTAL RETURN TO INVESTORS (12 MONTHS TO 7/19) 37% PRINCIPAL MARKET NYSE Explanatory notes: page 210