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                    Last update April 20, 2005



These are vignettes of real life situations, personally observed in various companies. These are funny stories about people doing things that make no sense, but doing them very seriously (management foibles count). Everyone who reads these stories laughs, and some have asked me how people could really be doing these things. It is pretty clear that you don't have to be a systems person or have any special training to "get" these stories; apparently the only person who didn't "get it" was the one doing the job. That is a normal human tendency true of all of us. Once we have done something a few times, we tend to keep doing it in the same way, over and over, without stopping to think whether it makes sense.

The essence of systems study is the observation and reduction of these situations. Useless work is ridiculous, and what makes it funny is the ease at which an outside observer can see that it is useless. That is what makes "Pin the tail on the donkey" funny. Here the blindfold is repetition and habit. In the case of management foibles it may be the habit of never being questioned. It is said that systems work can eliminate 30% of all the work that is being done in any company. In my experience that is conservative.

Neatness counts


The clerk was busily alphabetizing about 40 sheets of computer output. She said that when she was finished she would place the stack on top of the file cabinet next to her desk "in case anyone needed to look at them". It looked like there was only about one day's worth on the cabinet, so I asked her where they went after that. "When I put today's up, I will throw yesterday's away". She couldn't remember anyone ever having looked at the stack while it was on the cabinet.

Tomorrow is a new day


On another day the same clerk was shuffling a sizable stack of paper status output in her lap. These error reports generated anew each day if the error was not corrected. She was finding the ones left over from yesterday and substituting the one from today, one by one. I asked her if she had completed all the corrections she was going to do today. She had, so I took the stack from her lap and dropped it in the waste basket. Sure enough, the next morning she received a complete set.

A different sort


The new insurance applications went to the agency department first (a poor procedure but not the point here) where the documents were arranged in a certain order and stapled together, then sent to the issue department where the staples were removed and the documents placed in a different order.

They came unhinged


The check stock was locked up in the accounting department in a closet, and released by the numbers to EDP where the checks were printed. The control procedures were tight, but the hinges on the closet door were on the outside. When the controller arrived the next morning, someone had pulled the pins and set the door aside. Just one check was missing, but I gave it back later so we could get some work done.

Too many needy employees


My first week on the job I disapproved a request to purchase a roll of movie tickets. The next day an irate theater owner called and wanted to know who I thought I was to arbitrarily cut off something that had been going on for years. Our supply manager explained that he was handling the tickets as an employee benefit. He would buy a roll every few months and distribute them to our employees, at the wholesale price to those that could afford it, or free to those he considered needy. Apparently the movie goers were the poorer ones, as no proceeds had ever come back to the company.

Poor printing


The caller claimed he had been overcharged for business cards printed in our print shop, and the quality was poor. Problem was the company didn't do any outside printing, knowingly.

Quantity discount


The storage area contained 8 large, dusty cases of copier toner, conservatively a 5 year supply. The supply manager also had a nice stereo as a promotional item. Unfortunately the toner didn't work for the copiers currently in use.

Stop thinking


Stop pays could be issued from any department, and were common when someone claimed they had not received the original check issued. A quick glance at the day's requests showed stop pays issued for checks of $5 or less. The bank was charging $20 for each stop pay.

Lead system


The local agency was excited, having just signed up a business which was giving them a list of all its customers to use as leads. The business was a check cashing operation. The insurance company only accepted bank draft business.

Guaranteed all right


Guaranteed issue was available if the agent obtained an application from 25 of the employees. Once that qualification was met one time, all future applications from that company were issued without underwriting, even if the later application came several years later from someone that refused coverage the first time around.

Computer error


It was my third month at the company, but I hadn't noticed the closed door off the main accounting area until one day a woman opened it and walked in. In that windowless room two women were running their fingers down columns of numbers on green bar and churning out adding machine tapes. They said they were the remainder of the team that completed a conversion after a merger the year before. It was their job to see if the mainframe was totaling columns correctly. How long had it been since they discovered an error? In over a year, never. But sometimes they made mistakes on the tapes. The CFO said he didn't realize what they were doing in there.

Problem solved


Directly in front on the manager's office window, a clerk was slowly using a letter opener on a large stack of waiting envelopes. Asked why they did not have the mail room use a machine slitter on their mail, the manager said they did. "Then what is he doing" I asked, pointing out the window. The manager rushed to the clerk as I left the department. When I came back through the clerk was nowhere to be seen, and I was told he did not reappear until I left the building.

Counting difficulties


I was doing a short systems survey at a California company and started as usual in Policy Issue. A single application had arrived that morning, bringing the 5 day total to 11. The app had been taken from the mail room to a second mail area which prepared data entry slips showing the date of arrival. This was so the tracking system could report to management the number of days each department took to handle the app. Then to Issue, where the morning count (1) and afternoon count (0) was posted to a sheet on the wall. After processing, the next data entry slip was prepared, showing transfer to Underwriting, but dated the next day. I was told Issue took responsibility for the extra day as a favor to underwriting. As I was leaving I noticed a small yellow sticky note on the floor. It had the number 1 written on it. The supervisor thanked me, as it had fallen off the app. The sticker was stuck on the app when its arrival was noted on the wall, to show that it had been counted, and to insure that it wasn't counted again.

Accounting difficulties


That same day I found bigger volume two floors away at the separate issue department of the mail order division. Of the 80,000 applications received that spring, management guessed that about 20,000 remained in the department. No counts were maintained, but apps pending for more than 1 month were moved from the 1 month file drawers to the 2 to 6 month file drawers, which allowed the two backlog numbers to be estimated. My suggestion that they borrow people from ordinary issue drew a patient look. "They are in a different cost center". (Mail order didn't use the yellow sticker system either).

Permanent solution


The mail order policy issue department had 23 permanent employees and 60 temporary employees. Knowing the fluctuations in volume, I didn't question the unusual ratio (thereby making a classic systems mistake). However, when I got to customer service , where the work was more constant, there were 50 permanent and 60 temporaries. The manager advised that she was not authorized to add permanent employees, but could use temporaries however she wished. She said training was no problem, as the temporaries on the average stayed as long as the permanent employees, and most had been there for years.

Accounting efficiency


The next day the claims department demonstrated their new "home grown" system that would run on a stand alone PC, and would replace an existing system that was running on a central server. The old system had worked fine, but the DP department at the parent company charged the claims department $58,000 a year (1984 dollars) for the service. At that price, it made "sense" to hire a PC programmer (labeled a "claims auditor" since only DP could do programming) and to do the work on their own PC. The DP department turned out to have excess machines and programmers, understandably.

Out of sorts


The list billing clerk looked harried as she searched the 20 page billing the customer had returned with payment, clicking off non payments on the terminal screen. The billing was in alphabetical order, and the screen in policy number order, so each item required searching the whole list for a match. I suggested she request the screen be sorted to the same order of the bill.

Twice the pleasure


My old friend Charley, the former chief underwriter for the company, called to suggest I replace my whole life policies with universal life, more coverage, same premium. Charley had retired and the company gave him all the orphan policies to roll, at full commission. The offer seemed better for me (at least until the mortality charges ate up the difference) and sure good for Charley, but I couldn't see why the company would be trying to replace all its business wholesale. They told Charley they wanted to replace it before some other company did. That made no sense until he added that management was reporting each replacement as new production. Oh.

But look at the money he saved


In the middle of December the CEO, the former Agency VP, ordered all the pending applications in underwriting issued before year end. He had a really good month, but January turned out to be surprisingly terrible.

Inventory control


The supply department was using a dedicated computer system to maintain a perpetual inventory of the paper forms on the shelves. The number of sheets was debited as orders were filled, credited when more were printed and shelved. However, since it is hard to count sheets of paper in a stack accurately, you couldn't quite count on it, so the clerks reordered printing when the shelves ran low, even when the report showed plenty.

Inventory locater


The inventory computer had other uses. The paper forms were shelved in the order of the inventory number. The inventory number was not the same as the form number, and bore no relation to the type of form. Forms were requested by form number or type, so to get the location you entered the form number on the computer, which gave you the location number.

The eye of the beholder


The mainframe printer which produced the outgoing letters from the new correspondence system was the old chain type, so the letters were printed in all capitals, and the unattractive type face appeared uneven. The field felt the letters looked horrible to the policyholders. We couldn't change the printer, so we changed the paper stock from high quality letterhead to cheap yellow half sheets that looked like what telegrams used to be printed on. It was an immediate success, since the "telegrams" not only looked right, but also more important, and were reported to be getting there faster.

No problem


An employee commented that it looked rickety and that she would never step out on the old fashioned external fire escape. I wasn't anxious to do so myself, but it was time to demonstrate a concern for safety (and a little bravery). I needn't have worried. None of us could open the window exit to the fire escape.

Color blind


Each insurance subsidiary had a different color premium notice, which helped the clerks sort them into separate stacks by company before running them through the scanner to read the bar codes. When one stack was finished, the clerk continued with the next stack. There was no reason to key anything before shifting to the next stack because the computer, which couldn't see color, and didn't care in what order the documents were scanned, identified the company from the code on the notice.

Upside down in the window


The commercially preprinted direct premium notice form was expensive, and Mike and I were trying to convert it to the mainframe laser printer, where the form could be printed on plain paper in the same pass with the specific billing data. The stumbling block was the company address on the return document. To fit in the window envelope when folded, it was printed upside down. After more than a week of origami and test runs failed, we pulled a return envelope out of an outgoing notice to see if we could move the window. The return envelope had no window. The company address was printed on the envelope.

First class leadership


When the Chairman and the President issued a memo saying that they had been flying tourist to reduce travel expense and found it quite comfortable, and suggesting that all employees do the same, a wag in the law department asked if they had installed a third row of seats in the company airplane.

First class letter


What attracted my attention was the crooked way the form had been inserted in the typewriter. The claims form letter was addressed "Dear Beneficiary", and began: "Condolences on the death of your ____________. " At an angle across the blank line was typed "mother".

Over budget


On my first day at the company the only item on my new desk was a envelope labeled "Budget Package". The controller advised that since I supervised no employees I could just complete the personal items such as the annual travel expense detail, the book/magazine amount, and so on. I told him that I would not be making those decisions and had no control over what they would be. That was no problem, he said, "It doesn't matter who controls the expense, everyone has to have a budget, so put something down and explain any differences at the variance meetings next year".

Try, try again


As I was completing the application on the husband, the wife looked irritated and then blurted: "Aren't you going to tell him about your attempted suicide?" Hoping to save a sale, I assured him the app was worth submitting, and if it was declined we could fill the need by placing the coverage on the wife. Declined it was, and I was just completing the app on the wife when he asked "what about your attempt?". Submitted and declined. Back I went, and happy that none of the children had attempted suicide, submitted apps on them. Turned out the company didn't want to cover children when both parents were loco. The underwriters suggested I try the neighbors.

Cutting edge application


To get ideas for our web life insurance application I searched for other web offerings. Most just wanted to get some information and hook me up with an agent, but I finally found a well known company with an on line app. The "thank you for your application" screen told me I would hear soon. Several weeks later a hand written paper application arrived, completed verbatim from the information I had entered, with a letter asking me to sign the paper app and return it.

Address the problem


The Policy Service clerk completed the request on each of the policies on the policyholder, except for the address change. She attached a note to the files "Please change address from {this} to {that}on these policy numbers" and put the file in a stack. Asked why she didn't do the address change, she advised that "only Mary Ellen is authorized to do an address change", but she didn't know why. Curious, I carried the stack to the other department. A clerk there advised that there had been a problem in the past with clerks changing the address on one policy of a person with multiple policies, and not catching the others, so top management made the Mary Ellen rule. "What do you do when Mary Ellen is on vacation?" "Oh, anyone can do an address change" she said, taking the files.

Shop until you drop


The Chief Underwriter explained that he was sending big cases to 5 different reinsurance companies, "to get the best quote for the agent". He showed me a case on which 3 reinsurers had offered table 6, one didn't quote, and one offered table 2. He commented that it was probably a table 6, but often at least one of the reinsurers would "miss something", allowing him to issue at a lower premium. I suggested that since he believed the rating was inadequate he should not retain his normal first $150,000 and just give it all to the reinsurer. "Oh no, if I tried that, they would know they missed something!"

Your call


The practice was to call the agent whenever a case was rated, to see whether the agent wanted the premium increased or the face amount reduced. The person doing the calls had been doing it for several years, but could not remember a single instance where the agent had elected to increase the premium.

Turning the tables


Management wanted to issue the plan standard to people standard through table 4, so the actuary added about a table and a half of mortality charge to the premium, all that was necessary to cover the expanded class since only a portion of the applicants would be rateable. Underwriting, however, reasoned that the plan now included 4 tables of extra mortality, so they reduced every rating by four, table 8 becoming table 4 and so on.

Organizational concerns


The organizational chart was confidential, and no copies had been distributed. The master copy in personnel revealed that supervisory responsibility had been removed from two managers some time back, and new managers installed in an office next to the old. However, only people with a direct "need to know" had been told, for fear of "hurting the feelings" of the deposed individuals. The deposed individuals had not been told either, which, I was advised, created an awkward moment from time to time, but everyone played along.

Nickeled and dimed


The dispenser in the women's rest room required a dime. Noticing a large case of the dispenser supplies, I asked who collected the dimes. The records showed many years of paying for supplies, but no dimes, and nobody had ever collected any. So with some excitement we got the key to the mother load of dimes. There were three in there. The mystery was never solved.

Accounting independence


I asked the CFO why the company was buying back its common stock. "Because I think it is worth more than the market price" was the response.

Ah John, we hardly knew ye


The Monday officers' meeting always opened with a detail enumeration of the week's death claims, and a discussion of the departed individual if anyone knew him. When there were no more deaths, the meeting adjourned.

Glad to help


After a short survey at a new company, the CEO called in the CIO to discuss some suggested program changes. When he hesitated over one in particular, I suggested that he could have it in test in 4 or 5 days. Glancing at the CEO he growled "Just what we need, another program estimator."

Telephone ups and downs


One particular extension was generating a lot of long distance charges, but had no user name associated with it. It was finally traced to the emergency phone in the garage elevator.

Easy credit


I requested a company credit card and the controller gave me one that he had received some time back, even though he had not ordered it. After several months I noticed it didn't seem to matter when I overlooked listing charges to the card on my expense account. I was told that the credit card bills would be matched against my account, but so far no bills had been received. Several months later, same answer. When the controller called he found the bills were going to an agency and were paid current. The agency principals had obtained cards with the company name. Since only the two of them had cards, they didn't bother to check on which made a charge.

Usurped authority


Someone dropped a cigarette on the upholstered bench in the elevator hall just outside the executive wing. The flames damaged the nondescript wallpaper. The president had the hallway redone with somewhat different nondescript wallpaper when the chairman happened to be out of town. Upon his return, the chairman had the hallway redone again with somewhat different nondescript wallpaper.

Not my department


The chairman (a different one) noticed that people were arriving after the official starting time and ordered the personnel manager to stand in the hall and take names. That got everyone making sure they got to work on time, except the star actuary who was in the habit of coming in up to an hour or so late but then working until 7 or 8 at night. After 3 warnings the chairman ordered the head actuary to fire him. Hoping it would blow over, as these things usually did, the head actuary did nothing. When the chairman found out his order had been ignored, he fired the head actuary. The head actuary kept coming to work anyway and so it must have blown over, but the rest of us took no chances.

Not my department


The company had no intranet. It was long past the time this essential employee tool was easy to establish, and the company had servers, a LAN, and a department dedicated to PC support and programming. But there turned out to be a perfectly logical explanation. The web person was on the marketing budget, not the programming budget.