Fraternity-Testvériség, 1972 (50. évfolyam, 1-12. szám)

1972-04-01 / 4-6. szám

LÁSZLÓ L. ESZENYI, Controller:

AUTOMATION: YES OR NO

Automation of our administration and billing system became one of the most controversial issues. Introduction of the Electronic Data Processing (EDP) — if the Convention votes for it — will be the most important single development in the history of the Federation since 1928, when the legal reserve basis was adopted and non-forfeiture values were set up.

Since this resolution might decisively influence the whole future of the Federation, we try to present and weigh pros and cons as impartially as possible so that the decision may be made in full knowledge of the far-reaching consequences.

First, let us deal with the following arguments of the opponents:

1. The number of dues paying certificates, that is the number of accounts to be handled in the Home Office and at the branch level shows a decreasing tendency since 1959. The volume of administrative work does not justify the immediate automation.

2. A recent survey conducted among the branch managers revealed that only 30% of the membership is sending his dues through mail and the rest must he personally contacted at their homes, after Church services or in the branch offices. Automation would mean that the majority of the membership should be persuaded to send their dues by mail in the future. A tedious task with questionable outcome since some of the branch managers do not themselves believe in the new system of collection.

3. Managers would necessarily lose the present close contact with their members: underwriting of new business will suffer. Advocates of this point seem to forget, however, that close to half of our managers do not organize new members anyway.

4. Aches and pains suffered by our sister organization during the transition period due to unproper programming was widely publicized and built up hostility and mistrust toward computers among our people. The success of the transition and the further smooth operation largely depends on the willing cooperation and understanding of the branch managers. Their conscious or subconscious reluctance would make the road to an automated system extremely rough.

5. The cost of the transition alone would amount

to $40,000.00 or higher which the Federation cannot possibly afford unless payments can be spread over several years.

6. Operation under the computerized system would not result in any significant savings unless direct Home Office collection would be adopted, a solution apparently objectionable to most of the people.

Now let us see the reverse of the coin, or what the advocates of the Electronic Data Processing are saying:

1. In the manual system, there is no direct contact between the membership and the Home Office, the branch managers are not only connecting links hut dividing walls. Controlling the individual payments is utterly difficult if at all possible.

2. Presently, two parallel systems are in operation. One in the Home Office using addressograph machine as a tool and a computerized system in the office of the Actuary where data forwarded from the Home Office are tabulated for the Annual Statements: a yearly report to the States Insurance Departments. Introduction of the Electronic Data Processing would mean the elimination of the present duplication.

3. In the manual system there are too many tools and aids used, such as premium notices, receipt hooks, branch collection cards, monthly reports, Home Office account cards, addressograph plates, report sheets to the Actuary, etc. As many postings, as many possibilities to commit errors. The present system relies completely on the branch managers. Their replacement in case of death or resignation became increasingly difficult. The younger generation does not seem to be interested in the fraternal activities. Sudden death of a manager always means a flock without a pastor and as a result the Federation is losing quite a few poorly serviced and frustrated members. The training of the new branch people constitute another half sold problem.

4. There is only one well trained machine operator in the Home Office with one back-up man: a very dangerous bottleneck. Death, disability or resignation of these men would lead to an impossible situation, perhaps paralyzation of our whole operation for at least two or three months. He prepares monthly reports to the branches for dues collection; new and change cards to the Secretary’s office to compute salaries and expenses to the field-force; and monthly fluctuation reports to the Actuary for tabulating service.

5. Computing compensation to the field-force based on the premium dollar income is almost impossible in the manual system. If such solution would he forced without computerizing our administration, it

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