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SYSTEMS ANALYSIS

FOR

EFFECTIVE ADMINISTRATION

MODERN INDUSTRY BOOKS

Your Public Relations GLENN GRISWOLD AND DENNY GBISWOLD
Standard Business Conference Technique CARL HEYEL
How To Reduce Distribution Costs RICHARD D, CRISP
Practical Handbook of Industrial Traffic Management RICHARD C. COLTON
Management Controls for Foremen and Supervisors HARRY J. McCAULLY, JR.
The Law of Free Enterprise LEE LOEVINGER

Bargaining with Organized Lofcor RICHARD C. SMYTH AND MATTHEW J. MURPHY
Supervision in Business and Industry ROBERT D. LOKEN AND EARL P. STRONG
Wage Policy for Management SUMNER D. CHARM
Tested Techniques in Labor Arbitration GEORGE W. TORRENCE
The Economics of Industrial Management- WALTER RAUTENSTRAUCH AND RAY-
MOND VILLERS

Foundations for Constructive Industrial Relations R. CARTER NYMAN
Graphic Presentation Simplified-R. R. Lurz
How To Cut Production Costs-H. E. BLANK, JR.
Teamwork in Industry WILLIAM SEWARD
How To Sell to Latin America ABRAM A. PRECIADO
The Handbook of Advanced Time-Motion Study-L. ARTHUR SYLVESTER
A Training Course in Effective Speaking-PauL M. STOKES AND GRAY L. CARPENTER
How To Pick Leaders G. L. FREEMAN AND E. K. TAYLOR
The Bight Career for Yot* EUGENE J. BENGE -

Budgetary Control WALTER RAUTENSTRAUCH AND RAYMOND VILLERS
Effective Management Through Probability Controls ROBERT KIRK MUELLER
Systems Analysis for Effective Administration NORMAN N. BARISH

FOR
EFFECTIVE ADMINISTRATION

NORMAN N. BARIShL-_

Professor and Chairman of the Department of

Industrial and Management Engineering

New Yorfc University

FUNK & WAGNALLS COMPANY NEW YORK

in association with

MODERN INDUSTRY MAGAZINE NEW YORK

COPYRIGHT, 1951, BY
MAGAZINES OF INDUSTRY, INC.

4

COPYBIGHT UNDER THE ARTICLES OF THE COPYRIGHT CONVENTION

OF THE PAN AMERICAN REPUBLICS AND THE UNITED STATES

PRINTED IN THE UNITED STATES OF AMERICA

PREFACE

kLL MODERN enterprises-
whether profit or non-profit institutions possess three primary common
classifications of management problems:

1. Determination of the purposes of the enterprise basic policy on
what are its goals and what will be its scope of operations.

2. Determination of the best methods for organization and systematic
operation by the persons and groups which will perform the func-
tions which are required to accomplish the purposes of the enter-
prise.

3. Administration of the persons and groups as a team of cooperating
individuals most effectively to accomplish the purposes of the enter-
prise using the previously determined operating patterns.

This book concerns itself with the second of these problems: the
methods of translating management policy into action; of finding the
most effective, simplest, and cheapest means of accomplishing every
task. This systems problem is universal. It is present in every under-
taking, large or small. How effectively this problem is met will fre-
quently decide the success or failure of the undertaking. This book
aims to show some of the approaches which, if properly applied, will
help in the establishment of effective systems.

The general plan throughout the book has been a practical presenta-
tion of how to make successful systems analyses. First the basic prin-
ciples underlying good practice are presented in connection with each
aspect of the subject. Then, with illustrative examples, the application

vi PREFACE

of these principles using critical questioning procedures is shown.
Common pitfalls and obstacles to successful results are discussed and
positive action is outlined to help assure more fortunate results.

In addition to telling how to design, evaluate, sell, and install systems
and how to prepare systems reports and procedures, principles and
practices in the operation of a systems department are discussed in
some detail: how to organize to control the systems of the enterprise
and to administer a systems program.

Throughout the book are numerous examples of how various aspects
of systems and procedures analysis have been applied in leading enter-
prises engaged in a wide variety of fields of endeavor.

Systems Analysis for Effective Administration is thus directed to
persons concerned with any phase of managing the operations of an
enterprise. It is designed to interest the following types of persons:
supervisors of all the various specialized activities required in every
enterprise procedural responsibilities are an essential part of these
persons' operations; staff personnel engaged in various aspects of
systems work, such as systems analysts, forms analysts, equipment
specialists, organization analysts, procedure writers, and office planners;
students in colleges and universities; and top-management personnel,
who must take the initiative in starting, supporting, and directing a
strong and effective systems improvement program.

I am greatly indebted to the many business organizations and execu-
tives with whom I have been associated and who have contributed
immeasurably to whatever value this book may have as^well as those
who have permitted me to use the illustrations included in this book.

NORMAN N. BARISH

CONTENTS

CHAPTER PAGE

PREFACE v

PART I

THE SYSTEMS TOOL

I INTRODUCTION 1

Definition and scope of systems and procedures analysis What
are systems and procedures What will the systems technique
accomplish Why systems are important today Why busi-
nesses have poor systems

II THE SYSTEMS INVESTIGATION 8

Scope of a complete systems investigation Specific systems
investigations Steps in systems survey

III PRINCIPLES OF GOOD SYSTEMS 13

PART II

METHODS OF SYSTEMS ANALYSIS

IV PLANNING AND FACT-FINDING 31

Scope of project Scheduling activities Critical approach
Recording the data Sources of systems data Interviewing
procedure Written questionnaire Reports questionnaire
Duties questionnaire Appendix

vIH CONTENTS

CHAPTER PAGE

V ANALYZING THE FUNCTIONAL ALLOCATIONS

AND SYSTEMS FLOWS 57

Functional allocations chart Key questions Analysis of
functions allocations chart Organizational flow chart Key
questions for organizational flow chart Analysis of charted
systems flow Organization flow chart variations Activity
analysis chart Sample analysis of the inventory-control activ-
ities as entities Sample analysis of the duties for the perform-
ance of each activity Sample analysis of the duties of each
individual Department analysis chart Process chart Con-
structing the process chart Key questions Sample process
chart analysis Standards for construction of process charts
Elaborations of the process chart Organizational process flow
chart Forms distribution chart Questioning procedure
Sample forms distribution analysis Forms distribution chart
variations No magical charting technique

VI ANALYZING THE LAY-OUT 113

Importance of office lay-out Reduction of lines of com-
munication Conservation of space Accessibility to public
Organized about important flows Flexibility Proximity to
units being serviced Proximity to related units Private
offices Working conditions Personality biases Systems
information Lay-out of present arrangement Space require-
ment standards Estimating space requirements Forecast of
future requirements Floor plans Allocation of areas Prep-
aration of lay-out The lay-out flow chart Scale models
Office environment Lay-out is part of system

VII ANALYZING THE MOTION ECONOMY 136

The right-and-left-hand chart Analyzing the right^id-left-
hand chart Illustrative analysis Size of motion elements
Time study analysis Micromotion study

VIII ANALYZING THE FORMS DESIGN 159

Combining forms Arrangement of data Potentiality of
errors Vertical and horizontal spacing Headings and in-
structions Filing data or symbols Visible file Serial num-
bering Margins Using both sides of form Weight and
grade of paper Ordering quantities Production method
Type style Title of form Forms-control number Colored
paper, Perforations, corners, holes, etc. Sizes of paper
Consult printers and manufacturers Kinds of forms Forms-
control system Analyzing the forms Reports and charts
Examples of improved forms designs Types of savings

IX ANALYZING MACHINE UTILIZATION 188

Possible advantages from the use of equipment Standardiza-
tion of equipment Synchronizing personnel and equipment
Application of motion-economy principles Analysis of files
and filing methods Analysis of reproduction equipment
Equipment-control procedure Sources of information Dem-

CONTENTS (x

CHAPTER PAGE

onstrations Equipment decision based on economy studies

Office equipment Desks, tables, and chairs Files
Microfilming equipment Typewriters Computing machines

Dictating machines Billing and bookkeeping machines
Mechanical collators Sorting equipment Punched-card
equipment Printing and duplicating equipment Guide to
reproduction methods Automatic locking forms registers
Planning boards and mechanical graphs Electric staplers
Folding machines Filling or inserting machines Envelope
sealing machines Modern technology in the office

PART III

EVALUATION, SELLING, AND INSTALLATION
OF PROCEDURES

X SELECTING AND SELLING THE SYSTEM 215

Assumption of different levels of efficiency Average interest
error Book-value error Capitalization of book-value loss
Inaccurate assumption of future requirements Incorrect use
of overhead ratio Improper interest rate Understanding of
alternatives and assumptions Evaluation of intangible ele-
ments The report Selling a new system Employee
motivations Suggestions for effective selling

XI WRITING SYSTEMS REPORTS AND PROCEDURES 235

Elements of the systems report Elements of the procedure
Clarity and effectiveness of style Measuring the effectiveness
of writing Potential efficiency of a report Appendix

XII INSTALLING THE SYSTEM 254

Methods of installation Transcribing of new records Train-
ing principles Training techniques

PART IV

MANAGEMENT OF THE SYSTEMS TECHNIQUE

XIII THE SYSTEMS-CONTROL FUNCTIONS - ORGANIZ-
ING A SYSTEMS DEPARTMENT 267

Organizational location Imposition of decisions Personnel
adjustments resulting from systems changes Supervisor train-
ing in systems analysis Controlling the systems functions
Systems follow-up The organizational manual Organization

CHAPTER

INDEX

CONTENTS

PAGE

charts Project control Workload sheets Project status
and summary records Project folders Final project reports

Procedures control Forms control Forms-inventory con-
trol Forms-numbering procedures Forms file Cross-
indexing file Ordering procedure Possible savings from
forms control Lay-out control Equipment control Equip-
ment file Equipment standards Requisitioning equipment

Review of equipment Qualifications for successful systems
men Appendices

309

Part I

THE SYSTEMS TOOL

INTRODUCTION

I ANY ARE THE RISKS of
doing business and many are the business failures which result from
an inadequate approach to these risks. It would take many pages merely
to list, let alone explain, the numerous ways and reasons businesses
have failed and continue to fail. It is nevertheless possible to arrange
the causes of business insolvencies in two prime groupings: failures
which may be traced to the faulty, inefficient, or uncoordinated inter-
nal functioning of the enterprises; and failures which are caused by
conditions external to the business, such as national economic upheav-
als, poorly forecasted competitive conditions, etc.

It is hard to estimate the proportion of business failures falling in
each of these categories. Although an enterprise may be very poorly
operated, it may not only keep its head above water but may also
produce a healthy profit because of fortuitous external market condi-
tions. Such a company, however, is in a very vulnerable position when
its market conditions become less auspicious. When this company goes
under during a period of contracting markets for its products, the
superficial onlooker may come to the seemingly obvious conclusion

2 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

that the failure is due to external forces a declining market. Never-
theless the true cause was poor operating procedures.

A careful analysis of a large number of business failures will disclose
that the fundamental causes of failure lay inside the company and
within the control of its management, even though the immediate cause
may have appeared to be general economic troubles in the industry or
community.

It therefore behooves the management and employers of business
enterprises to examine their methods and systems of conducting busi-
ness. Are these methods and operating systems well coordinated for
lowest cost production of the correct quality of goods and services as
required by the community?

There are two possible approaches to this problem of increased
operating efficiency: one is to attempt to induce people to apply more
effort to work faster; the other is to simplify the procedures for
performing the work so that, with the same effort, more work
will be accomplished. The systems technique stresses this latter
approach.

DEFINITION AND SCOPE OF SYSTEMS AND
PROCEDURES ANALYSIS

Systems and procedures analysis consist of the study, analysis, and
improvement of the systems which service, control, and coordinate all
the operations of the enterprise. Systems analysis thus encompasses
the design of planning tools for giving direction to the enterprise's
activitiesthe development of programs for determining what should
happen in the future; and the design of control tools to ensure that the
plans are effected and the results evaluated. Analysis of operations
which directly change the form of a product is usually known as pro-
duction or methods engineering. This latter subject is outside the scope
of this book.

This book is concerned with systems and procedures. The men and
women who make these studies and analyses, who devise better and
simpler ways for the performance of the required functions of an
enterprise, are presently called by many different names. Some of the
more common titles of persons who perform some aspects of systems
and procedures work are: systems analyst, organizations analyst, pro-
cedure writer, forms designer, office engineer, management engineer,
office equipment specialists, office planner.

INTRODUCTION

WHAT ARE SYSTEMS AND PROCEDUKES

Systems may be defined as the means by which the personnel of an
enterprise operate to accomplish the enterprise's objectives. They pro-
vide the medium for translating managerial policies into action.

Procedures are the written and oral instructions which give "legal"
sanction to a system. They are the formal instruments, frequently
written or charted, which govern and prescribe the operations com-
prising a system.

WHAT WILL THE SYSTEMS TECHNIQUE ACCOMPLISH

Application of the systems technique can benefit the business enter-
prises of today in numerous ways. By coordinating all the activities of
the enterprise within a workable organizational structure, they enable
the business to produce and deliver its products and services on sched-
ule as required by the customer and at the lowest possible costs. Spe-
cifically, some of the benefits which may be derived from systems and
procedures analysis are:

1. Reduction in the operating time cycles to enable earlier delivery
dates.

2. Lowering of inventories.

3. Reduction of errors in predicting costs and delivery dates.

4. Elimination of unnecessary functions and activities.

5. Faster working capital turnover and reduction of working capital
requirements.

6. Greater operating flexibility speedier transfer of top-management
decisions into action.

7. Elimination of the conflicting systems and operations which work
at cross-purposes.

8. Increase in the effectiveness of supervision by reducing the amount
of time required for correcting errors, handling complaints, and
taking disciplinary actions. Time spent in reading unnecessary
reports or unnecessary information on reports is eliminated; time
spent in getting required information is reduced.

9. Strengthening of the organization structure of the enterprise
through the disclosure and elimination of practices which violate
sound organizational principles. Since good systems cannot be de-
veloped on the substructure of a poor organization, systems analy-

4 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

sis will disclose such basic errors as misplaced functions, responsi-
bility without authority, unnecessary functions, etc. and bring
them to managerial attention for correction.

10. Reduction of the clerical cost of performing the coordinating, con-
trol, and service functions required in the enterprise by prescribing
the best motion patterns, by proper lay-out and equipment; by
standardizing and controlling the efficient design of forms, by
eliminating unnecessary practices, reports, and records, and by
simplifying and combining the required ones.

To illustrate just the savings in clerical cost which are made possible
by systems analysis, two case histories are briefly outlined. The first,
quoted from an article appearing in the Bulletin of the National Asso-
ciation of Cost Accountants, indicates how elimination of an unneces-
sary activity, discovered through systems analysis, increases profits.

"In one branch house an extra copy of repair invoices had been pre-
pared for the sales department for the purpose of recording, by dealers,
the sales of a certain item. This required every invoice to be first scru-
tinized for the parts in question and required such sales to be tran-
scribed to a separate record. It was found that this sales record had not
been used for many years and that the labor and paper cost per year
to prepare it equalled the profit of some 2,000 of these items." *

Later, when discussing forms design and control, the usual system for
controlling the stock of forms will be mentioned: keeping a. stock card
for each form with a minimum balance indicated thereon; deducting
from the previous stock balance at each withdrawal to get a new bal-
ance; when the balance goes below the minimum indicated balance,
placing a reorder (first examining to see if the forms design can be
improved). Departmental expense charges for the use of the forms are
made as the forms are withdrawn from stock.

As a simplification of this necessary function the following procedure
has been successfully used: departmental expense charges are made,
based on estimated usage at the time of purchase of the forms; the
minimum-balance quantity of the form is physically segregated and
labeled as minimum stock; no stock card is kept, but when it is neces-
sary to withdraw from the minimum-balance quantity, part of the de-
tachable minimum-stock label is sent to the proper group as a notice
for reordering. ! ?

* Eugene R. Harrison, "Let's Look at the Records," NACA Bulletin, Nov. 15, 1948,
p. 289.

INTRODUCTION

WHY SYSTEMS ARE IMPORTANT TODAY

The earliest industrial enterprises of three centuries ago did not re-
quire systems and procedures analysis. Most enterprises of the nine-
teenth century managed with only limited consideration being given to
these problems. Why, then, is systems analysis needed today when it
was not generally needed years ago?

The small industrial enterprises of the past centuries did not require
systems and procedures because the functions which modern systems
coordinate, control, and service were usually all performed by one or a
very limited number of persons. There was thus little necessity for
formalized means of coordinating the work of the various people in the
enterprise.

In the old-fashioned one-man blacksmith shop, the owner blacksmith
normally performed all the direct manufacturing operations as well as
the other necessary functions (this listing is not all-inclusive) :

1. The sales function by contacting his customers at his door and
elsewhere.

2. The design-engineering function by planning the form and design
of his products to fulfil his customers' requirements.

3. The planning and scheduling function by establishing delivery
dates and sequences for his work.

4. The cost-estimating function by estimating and quoting a price.

5. The production-engineering or methods function by deciding how
he was going to make the product.

6. The purchasing function by buying his irons, hammers, anvils,
raw materials, etc.

7. The direct manufacturing function by making the product him-
self.

8. The shipping and delivery function by delivering the finished
product to the customer, usually at the shop door.

9. The accounting and fiscal functions by billing his customers, col-
lecting his accounts receivable, and keeping such financial records
as he considered necessary and desirable.

10. The systems function by deciding what organization (himself)
and what routines (if any) were required for proper coordinating,
controlling, and servicing of the operations of the business.

In general, very few routines, other than perhaps some financial ones,
were required for the operation of this one-man business. The systems

6 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

function was therefore comparatively simple and unimportant. It is
listed here only to indicate that every enterprise, no matter how small,
must perform this function.

As the size of the enterprises increased, however, the systems func-
tion has become more and more essential. It became more and more
difficult for the boss to keep in his head all the facts he needed/ More
records, forms, and reports were devised to maintain control of the
business operations. Responsibilities for the performance of the func-
tions of the enterprise were divided amongst numerous groups. Within
these groups, the activities were assigned to specialized personnel who
performed only one small portion of the function. In the modern indus-
trial enterprise, not only do different persons perform each of these
principal functions, but each person performs only a small part of each
of these functions. The problem of coordinating the work of all of these
interdependent organizational units and persons has become gargan-
tuan. The possibilities of savings and improvements through better,
simpler systems have increased in proportion.

WHY BUSINESSES HAVE POOR SYSTEMS

Many businesses today use systems that should be improved to pro-
vide better coordinated, less costly operation. The internal evidences
of this fact are available to all business managers who are struggling to
streamline their performance to meet competitive conditions, increase
profit margins, and maintain adequate control of the enterprise. The
external evidences are available to outsiders from the trade reputations
built up by certain companies for not keeping shipping promises; from
the danger signals which are appearing in many financial statements;
and from the activities of certain engineering firms which specialize
in systems work.

Why do these businesses operate with poor systems despite the fact
that, by and large, most of the personnel are very competent and sin-
cere persons who are doing their work in what they consider the best
manner?

The systems in many concerns have been established over long
periods of time as required by the various supervisors, department
heads, and top management. Many of these were probably very good
at one time; some were not good even when adopted.

Some of these apparently good systems were built around the special
personalities and abilities of persons in the organization. When these
persons left the company or transferred to another position, the old

INTRODUCTION 7

systems were usually retained. These systems, however, do not operate
too well now because they were designed to accommodate one par-
ticular set of abilities which is no longer present in the organization.

Many originally good systems have become bad ones because the
character of the business operations has changed without correspond-
ing adjustments in the systems. As a business develops, its scope and
objectives shift and its systems requirements change. Conditions ex-
ternal to the business change and require adjustments inside the com-
pany. Unless special steps are taken to keep them up to date, the
systems will deteriorate in value.

Certain activities are considered relatively unimportant when first
initiated and are assigned to the departments which have available
staff, even though they may not be functionally best suited for the
assignments. Later, when these activities have developed to their
proper scope and influence, they may remain with the original organi-
zational group. Procedural efficiency is adversely affected.

An activity is sometimes assigned to a department because of its
physical location. When the department's location is changed, the as-
signment of the activity should also be shifted. Failure to make this
shift results in poor systems.

As a company grows and new functions are added, it is necessary
to redesign the old systems and to develop carefully perfected new
ones to handle the added activities. It is necessary, in addition, to have
a logical over-all systems plan to assure the proper coordination of all
the enterprise's procedures. Otherwise, the net effect of all the added
systemseach one good when considered by itself will be like Topsy:
they just grow into one big unwieldy bulk.

In many cases, investigations of poor systems have disclosed that
they started as stopgap measures to handle an emergency situation
which was considered temporary. When the temporary situation, in-
stead of disappearing, became permanent, the stopgap system was
retained, despite the fact that it had been adopted with little analysis
and thought.

Poor systems tend to accumulate because people cling to those things
to which they are accustomed. They are generally suspicious and fearful
of change. Since the characteristics of enterprises are always changing
some more slowly than others systems are always becoming obsolete.
The natural resistance of most people to change thus fosters the con-
tinued use and accumulation of poor systems.

THE SYSTEMS INVESTIGATION

TYPES AND SCOPES of
systems surveys will vary over a wide range depending upon the pur-
poses of the investigation and the size and nature of the enterprise. In
some very small companies, one all-inclusive investigation might be
made which would cover the over-all organizational and operational
problems as well as the detailed procedural considerations. In most
cases, however, an individual systems investigation would be aimed at
solving one particular problem or analyzing one particular aspect of the
systems of the enterprise.

SCOPE OF A CX3MPLETE SYSTEMS INVESTIGATION

The first phase of a complete systems investigation is the analysis of
the allocation or delegation of the functions of the enterprise to the
various organizational units. Has the organizational structure been
established so as to provide for maximum performance of service in the
manner and time desired and at the minimum total cost? Are all re-
quired functions delegated to the proper persons? Are any wasteful
functions performed?

THE SYSTEMS INVESTIGATION 9

Having established the best organizational structure for the enter-
prise, with functions allocated so as to promote effective systems flows,
the next phase would be an analysis of the lay-out to determine if the
physical organization or placement of the units of the enterprise is the
best possible. Is most effective use being made of all space? Are the
physical relationships between the units of the organization most con-
ducive to effective operations?

A consideration of the economy of the more detailed operating
methods of the enterprise is in order after the managerial and physical
lay-outs of the enterprise have been analyzed. Are the motion patterns
used by the workers most economical? Are waste motions and opera-
tions performed? Can motion elements be changed, combined, or rear-
ranged to reduce fatigue or save time?

Much of this detailed systems work is recorded on forms. It is there-
fore logical at this point to consider the analysis and design of these
forms. Can forms be simplified to eliminate waste motions? Can they be
designed for the better performance of their intended functions? Can
the variety of forms be reduced by combining several forms? Can
carbon copies or duplicating carbons be used to reduce transcription
work?

Just as manual labor in factory operations may be reduced consider-
ably by use of machines, so the judicious use of properly designed office
equipment may reduce office and coordinating labor. How much stand-
ardization of equipment usage is desirable? What equipment is suitable
for the required functions? Is it more economical than manual per-
formance? Are the machines and personnel synchronized as well as
possible?

SPECIFIC SYSTEMS INVESTIGATIONS

A large proportion of systems investigations will not call for complete
surveys of all aspects of the operations of an entire enterprise. They
will be designed to answer one or several questions or to solve a specific
problem. The purposes of some of the more common types of systems
investigations are listed below:

To determine why a certain function or group of functions is not
being performed adequately and how its performance can be
improved.

To determine the best over-all organizational structure.

To determine the best design and/or distribution for a form.

10 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

To determine how the operations of one or more departments in the
enterprise can be improved.

To determine the best lay-out for a given department.

To determine why some one or more performances are not up to
expectation and what steps should be taken to correct the situa-
tion.

To determine whether the adoption of a proposed equipment is
advisable.

To determine the best organizational and/or physical locations for a
function or activity.

To determine the best way of performing a clerical operation.

The scope and terms of reference of a systems investigation should
always be carefully defined and observed. Although a complete systems
investigation will usually involve a consideration of organizational and
lay-out aspects, it is very possible to devise systems within a given
organizational structure and a given lay-out. The objective of the
investigation is then not to find the best system, but to find the most
effective one for an existing organization and lay-out.

STEPS IN SYSTEMS SURVEY

The scope of the project having been definitely established, the
analyst is ready to start on his survey. Outlined below are the principal
steps in the systems investigation. Not all steps are required or advis-
able in all cases. (Thus all new procedures are not formally prepared
in writing. ) The nature of the survey and the enterprise will be deter-
mining factors.

1. Plan and schedule the investigation. A preliminary survey may be
desirable to determine the factors involved in the problem and to
measure the magnitude of the task.

2. Obtain the systems information, carefully checking to insure
accuracy.

3. Perform one or more of the following types of required analyses:

a. Functional assignments

b. Systems flows

c. Lay-outs

d. Motion economies

e. Forms designs

f. Machine studies.

THE SYSTEMS INVESTIGATION

II

4. Using these analyses, determine the best solution to the systems
problem.

5. Prepare a written systems report outlining the investigation and
proposing the best solution.

SYSTEMS
INVESTIGATION

SYSTEMS
CONTROL

TO PLAN POLICY

TO DETERMINE

AND SOLVE

PROBLEMS

TO FACILITATE AND
CONTROL PERFORMANCE:

TO INSURE
CONFORMANCE

PLANNING
FACT FINDING

ORGANIZATION

ANALYSIS

PROCEDURES

Functional Allocations

Systems Flows
Layout

FORMS

Motion Economy

Forms Design
Machine Utilization

EQUIPMENT

EVALUATION
IMPLEMENTATIONS

LAYOUT

FOLLOW-UP

FOLLOW-UP

\^ ^>r^^

-~^*^ ^^

^ Sl ^^^__ ^-^^

Figure 1. The systems technique a diagrammatic representa-
tion illustrating the interrelationships of the systems investiga-
tion and control functions. The follow-up function properly
belongs in both categories.

6. Sell top management and supervision on the desirability of the pro-
posal.

7. Prepare written procedures and instructional charts and materials
to explain new operations to workers.

8. Install the system, providing adequate retraining of the workers
where required.

9. Follow up at periodic intervals to insure that the new system is
working satisfactorily as planned.

12 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

These systems-investigation functions interact with and are assisted
and complemented by the systems-control functions which are dis-
cussed in Chapter XIII. The interrelationship of the systems investiga-
tions and the systems controls is portrayed in Figure 1, which graph-
ically summarizes the principal aspects of the systems technique.

In this 'book, the persons performing the various routines and
analyses connected with systems work are called systems analysts. This
should not imply that all the systems analyses in an enterprise should
be made by systems experts. As pointed out in Chapter XIII, much of
the detailed improvements in clerical procedures are more eco-
nomically, more rapidly, and more readily obtainable by supervision
training in the work-simplification principles and analytic techniques
outlined in this book. An important function of the systems expert, then,
is to train the supervisor and coordinate the supervisor's activities,
which are naturally restricted to the activities of his own group.

PRINCIPLES OF GOOD SYSTEMS

"YSTEMS and procedures analy-
sis was previously defined as the study, analysis, and improvement of
the systems which service, control, and coordinate all the operations of
the enterprise. It also was stated that many businesses operate with
poor systems. What distinguishes a poor system from a good one?

The simplest and most fundamental answer to this question is that
a poor system is one that does not provide the enterprise with a re-
quired service on time and at the lowest possible cost. This statement
provides the cardinal basis for all systems work and, stated in a positive
fashion, it will be the first of our principles of good systems.

Since the systems must operate within the framework of the organ-
izational structure, it is impossible to divorce the organizational struc-
ture from the procedural structure of the enterprise. The organization
provides the skeleton framework around which the procedures are
built and, if the framework is weak, the system must also be weak.
Although a good organizational structure does not guarantee good sys-
tems, a poor organizational structure may make impossible the exist-
ence of good systems. For this reason, many of the systems principles
which will be presented in this chapter refer to the ways in which the

13

14 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

functional responsibilities of the enterprise are delegated to the various
organizational units.

However, for any particular company there may be several alterna-
tive organizational structures which will be almost equally good from a
systems viewpoint. It is also important to remember that considerations
other than the question of efficient systemssuch as taxes, financing,
legislation are sometimes of great significance in determining the
desirable organizational structure of a company.

The 24 general principles outlined in this chapter are guides to the
establishment of systems which will promote the achievement of the
objectives of the enterprise at the lowest possible cost and in accord-
ance with the desired time schedule. For a manufacturing enterprise,
the primary objective may be the production and delivery of goods to
the customer in accordance with a scheduled plan of operations. For
a hospital, the primary objective may be the provision of certain types
of medical service to a certain community or segment of the com-
munity.

PRINCIPLE No. 1

All the other systems principles are subservient to the cardinal rule
that a good system must provide promptly a required service at the
lowest possible cost.

The other systems principles which will be outlined in this chapter
are valid only because they promote the achievement of this first prin-
ciple. To satisfy this aim, a system must, first of all, promote the
achievement of the objectives of the enterprise, which meUfis, it must
provide a required service. Secondly, this service must be provided
when it will do the most good. Finally, the service must be performed
at the lowest possible cost.

PRINCIPLE No. 2

Other things being equal, functions should be allocated amongst the
various organizational units so as to minimize the amount of required
coordination, communication, and paperwork.

The greater the amount of required coordination, communication,
and paperwork, the slower the operations; the greater the possibilities
for mistakes; the larger the number of required checks; and the more
expensive the operations.

PRINCIPLE No. 3

To promote efficient systems, the responsibilities of each unit in the
organization should be a logical and harmonious grouping of require-
ments for fulfilling the objectives of the enterprise.

PRINCIPLES OF GOOD SYSTEMS IS

It is therefore necessary to have a complete and definite knowledge
of the objectives of the enterprise and of each of the organizational
units. Each unit of the enterprise should be a logical entity. It should
fulfil a definite purpose in furthering the objectives of the enterprise
and each subsidiary unit should serve a logical function in furthering
that, purpose.

For example, the purpose of the manufacturing division is to fabri-
cate and assemble the product as required by the sales schedule, in
accordance with the engineering designs and specifications, and at
minimum cost. To insure conf ormance with specifications, an inspection
department is necessary. To provide effective control of the incoming
raw materials, parts, etc., a receiving department is required. If the
receiving department were given the responsibility of quality inspec-
tion of all incoming material, the principle of logical and harmo-
nious grouping of functions would not be violated. If, however, the
inspection department were given the responsibility of receiving in-
coming materials, the unity of purpose of the inspection department
would be violated. The receiving function is a part of the material-
control function and is not logically united with the insurance of con-
formance to specification.

PRINCIPLE No. 4

A logical corollary to this principle of harmonious grouping is that
similar activities or functions should be placed together when other
considerations permit.

Thus, purchasing production material and purchasing office and
other indirect supplies are similar activities and might be grouped
together. Inspection of incoming material, parts, and components, and
inspection of in-process materials, parts, and components are similar
activities and, other things being equal, should be in one organizational
group.

PRINCIPLE No. 5

Especially where the element of time is important, the activities
which must be performed in sequence should be located as closely to-
gether as possible, both organizationally and physically.

This principle is sometimes in conflict with the statement of Prin-
ciple No. 4 that similar activities should be grouped together. Inspec-
tion of incoming materials and in-process materials are similar func-
tions and, from a functional viewpoint, it would be logical to unite
them. However, receiving and inspection are two activities which must
be performed in sequence and these activities contribute to the manu-

16 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

factoring time cycle. Where it is important to keep the length of this
time cycle to a minimum, then it may be desirable to divorce pur-
chased-material inspection from the inspection department and place
it under the material-control department which handles the receiving
function.

PRINCIPLE No. 6

In addition to having a logical and harmonious grouping of func-
tions, it is necessary that all functions required for fulfilling the enter-
prise's objectives be delegated to some organizational group.

Failure to do this may cause one of the following deleterious situa-
tions:

1. The function is not performed and the operations suffer as a result.

2. The function is assumed by a unit of the organization which is
poorly suited for it. As a result, it is performed poorly and costs too
much.

3. Portions of the function are assumed by different groups in the
organization, resulting in incomplete performance and overlapping
effort.

PRINCIPLE No. 7

It is equally important that no junction or portion of a junction be
performed when it does not contribute more than its cost to the enter-
prise.

This principle is self-evident. It says that unnecessary functions ( any
one that contributes less than it costs) should be eliminated; that un-
necessary equipment not be used; that the unnecessary (waste)
motions of the clerk be removed; that unnecessary forms be destroyed.

PRINCIPLE No. 8

It logically follows from the previous principle that a control system
should avoid the loss of at least the amount of money it costs.

If an auditing procedure costing $20,000 annually can be expected to
avoid the petty pilfering of only $10,000 a year, then the auditing pro-
cedure is not worthwhile. If a system costing $100,000 per year will
insure against a $1,000,000 loss which in all probability would not occur
more than once in twenty-five years, this system is also not eco-
nomically sound.

This principle, however, is not capable of easy application in many
cases because it is frequently very difficult to estimate the losses which
are avoided by a system. As a result, only gross violations of it will be
evident in the case of many control systems. Despite its difficulty of
application, this principle is nevertheless most fundamental.

PRINCIPLES OF GOOD SYSTEMS

17

PRINCIPLE No. 9

Where functions are dependent upon or service each other, they
should be organizationally as close as possible. Stated another way,
traveling up the organizational ladder, there should be a minimum
number of vertical steps before the dependent functions come to a
common superior.

It is desirable to have such functions as close as possible because in
that way responsibility for coordination is concentrated, enabling better
performance. For example, the purchasing and the receiving functions
of the enterprise are closely dependent on each other. Figure 2 shows a
typical organizational structure:

I General Manager

I Engineering I I Purchasing I Manufacturing I [ Comptroller ' [

1

1 1

Assembly
Sections

Fabrication
Sections

Planning

.

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1 Manufacturing
Methods

Production
Scheduling

Receiving

Figure 2. The receiving and purchasing functions are widely separated in
this organizational structure.

There are three vertical steps on the organizational ladder before the
receiving function reaches the general manager, who is the only com-
mon supervisor of the two functions. This might make coordination
of the activities of the two organizational units somewhat more difficult
than is desirable.

An alternative organizational arrangement is shown in Figure 3:

General Manager

[ Soles \ Engineering

| Manufacturing

Comptroller

Assembly &
Fabricafion

<?P/?///V?S

Purchasing

Receiving

Manufacturing
Methods

Production
Scheduling

Figure 3. The receiving and purchasing functions can be more easily
coordinated in this organization.

18 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

In this case, there is only one vertical step to the common super-
visor of the purchasing and receiving functions. Coordination of
these activities is thereby facilitated and responsibility is central-
ized.

PRINCIPLE No. 10

Each organizational unit should have all the necessary authorities to
carry out its responsibilities and these authorities should be placed as
close as practicable to the source of action.

If any department lacks authorities which are essential to the proper
performance of its function, then no system can work effectively. Thus,
if the purchasing department does not have the authority to negotiate
binding contracts, it cannot properly perform its purchasing responsi-
bility.

When the authorities for action are placed high above the source of
action, systems bottlenecks develop. For example, if the purchasing
agents and their buyers in the purchasing department are assigned the
function of negotiating purchase orders, but if every purchase order
regardless of size must be approved and signed by the chief pur-
chasing agent, the performance of the purchasing function will suffer.
Small routine purchases will be insensibly delayed, and the chief pur-
chasing agent will be unable to find the time to devote to the planning
and policy activities which are his primary responsibility.

PRINCIPLE No. 11

The inverse statement of this last principle is no less important.
Authorities should not be given which are not definitely required for
the performance of assigned responsibilities.

When this principle is violated and excess authorities are granted,
needless activities may be adopted by the department having the un-
necessary authority, thus distracting from its assigned objectives. Also,
the danger of misuse of authorities is greatly increased when individ-
uals are given authorities which are not required for the normal
performance of their functions.

As an example, foremen are given the authority to reject material
(issue reject tickets and determine disposition of the material)
despite the fact that the inspection department has the responsibility
of enforcing conformance to specifications. After a period of time, some
foremen will start doing their own inspecting. This resulting duplica-
tion of inspection activities and distraction of the foreman from his
primary responsibilities decreases operating effectiveness.

PRINCIPLES OF GOOD SYSTEMS 19

PRINCIPLE No. 12

The responsibility allocations of organizational units should not over-
lap.

There should be no conflicts of responsibility. In general, no two
organizational units should have completely common responsibilities.
Failure to observe this precept results in duplication of effort, conflicts,
and non-performance of some required activities.

If the assembly-floor stockrooms are assigned, among other functions,
the responsibility of initiating orders for replacement parts required
because of spoilage on the assembly floor and, as a check, the inventory-
control department is also given this same responsibility, a number of
bad results may occur:

1. The assembly stockrooms and the inventory-control department
may both do slipshod jobs of reordering because each expects the
other to catch any errors or omissions. The reordering activity may
thus, on occasion, be forgotten entirely. The personnel of the stock-
rooms and the inventory-control department will, of course, attempt
to shift responsibility for poor performance on each other.

2. Conflicts between the personnel of the stockrooms and inventory
control will be encouraged by this overlapping of activities.

3. Both the stockrooms and inventory control will be keeping similar
or duplicate records, which is very wasteful.

PRINCIPLE No. 13

As far as possible, control functions should be allocated to organiza-
tional units which are independent of the functions to be controlled.

The degree to which this principle is observed may play a large
factor in determining the effectiveness with which such control func-
tions as accounting, quality control, auditing, systems control, etc., are
performed. The further removed organizationally the control function
is from the activities which it regulates, the greater the possible degree
of independent control.

However, it is usually undesirable to segregate the control function
too much because of the reduced effectiveness of coordination. This
factor was mentioned in Principle No. 9 covering the placement of
functions which depend upon, or service, each other.

It would obviously be unwise to place the quality control function in
the hands of the manufacturing foreman, because one of the functions
of quality control is to insure that the foreman maintains the quality
standards specified by engineering. It would also be wrong to place the
internal-auditing function under the plant accountant because part of

20 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

this function is to check on the activities of the plant-accounting depart-
ment.

PRINCIPLE No. 14

Each group of the organization should be held accountable for its
performance to only one superior unit.

This is the same as saying that no person should have more than one
boss. If the timekeeper reported to the production-control department
as well as to the plant-accounting department, he might very well
receive conflicting orders on many occasions. Different emphasis might
be placed on various aspects of the timekeeping work by the two de-
partments, resulting in confused timekeepers. Not knowing to which
boss to look for final decisions would harm the morale of the time-
keepers.

In some situations, it may appear desirable to have an organizational
unit accountable to one superior group for administrative purposes and
to another superior group for technical direction. Such arrangements
may or may not work smoothly, depending to a great extent on the per-
sonalities and functions involved. These arrangements are usually
unsatisfactory and should be avoided as much as possible.

PRINCIPLE No. 15

In deciding whether to centralize or decentralize the performance of
service and planning functions, the economy of mass specialized opera-
tions and the elimination of duplication of functions must hLcompared
with the reduction of communication and paperwork costs, the
reduction in time cycles, the increased flexibility, and the greater
unity of control and responsibility possible under decentralized opera-
tion.

What are the advantages of centralized organization such as shown
in Figure 4?

In a centralized organization, there are greater possibilities of func-
tional specialization break-down of jobs into smaller, more repetitive,
activitiesbecause all work of the same nature is grouped together
regardless of the product being produced. Economies are thus possible
because of greater simplicity of jobs (easier to learn and acquire high
skill) and because each supervisor can become a specialist in his own
field rather than a jack-of -all-trades.

A centralized structure enables top management to control the activi-
ties of its operating divisions by means of the highly specialized and
centralized staff-control functions. Since these staff-control activities

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22 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

such as the accounts and finance division and the production-planning
division each report to one man who reports to top management, con-
trol of the enterprise is simplified.

Because of the greater specialization of the job and the restriction
of responsibilities to one phase of activity, replacement of high and low
ranking personnel is simplified in a centralized organization. Salary
costs for the top men are therefore a bit lower.

What advantages does a decentralized organization such as shown in
Figure 5 have over the centralized kind?

Decentralization reduces the possibilities of functional specialization
in favor of product specialization. Product specialization makes it easier
to fix responsibility for proper performance and, as a result, creates
greater incentives.

Under the centralized organization, no one person had complete
responsibility for the production and sale of Product A. As a result, it
is relatively difficult to fix responsibility for the good or poor perform-
ance. Since recognition of good performance is more difficult and since
no one of the persons under the general manager has complete control
of the situation, the incentive to insure good performance in Product A
is somewhat reduced. Under the decentralized organization, the Product
A manager has complete responsibility for all functions connected with
Product A. If Product A fares well, then he is recognized for his good
work. If it fares poorly, then the Product A manager cannot shirk
responsibility since he has complete charge of all the functions con-
nected with Product A.

Although there is duplication of functions in each product line under
the decentralized organization, the total volume of paperwork is usually
reduced by decentralization of a large organization. A decentralized
organization, consisting essentially of relatively small units which are
functionally almost independent of each other, does not require as
much coordinating paperwork as the single, larger unit of the cen-
tralized organization.

The production time cycle is generally shorter in a decentralized
organization because the smaller, less specialized service departments
of a decentralized company can act faster than the very much larger,
highly functionalized service and control departments of the central-
ized company.

A decentralized organization is usually more flexible than a central-
ized one because its less specialized units can adapt themselves to
various types of operations more readily than the highly functionalized
centralized structure. This is an important consideration in enterprises

PRINCIPLES OF GOOD SYSTEMS 23

and industries which are continually undergoing considerable changes
in their operations.

It is essential then to consider all factors when determining the
desirable degree of centralization and decentralization. The optimum
point varies from enterprise to enterprise and depends on the many
different characteristics of the business. Decentralization of the organi-
zational structure of an enterprise tends to increase the manageability
of large enterprises. On the other hand, centralization of small enter-
prises tends to increase the possibilities for benefits from functional
specialization. There are many variations and degrees of centralization
and decentralization. To determine the best amount and variety for any
particular enterprise, thorough analysis and seasoned judgment are
necessary.

PRINCIPLE No. 16

In determining the most desirable form of organization, considera-
tion should be given to the advantages and disadvantages of the three
principal types of organizational structures: line, staff, and committee.
No one of these ever exists in pure form but every organization is a
combination of varying proportions of two or three. There is one best
combination for each enterprise. The systems analyst must constantly
strive towards the best combination, which is different in each case.
This best combination will maximize the advantages of each type and
minimize the disadvantages.

The line organization structure is the simplest, most direct kind. In
this organization, there is no specialization by functions. Each super-
visor is responsible for all aspects of the work of his inferiors. In its
pure form, the line organization represents the ultimate in functional
decentralization. A representation of a possible line organization is
shown in Figure 6.

Although not practical in its pure form in most modern industrial
organizations, the line form of organization possesses some definite
advantages which it is desirable to salvage in a modified structure: it
is simple, providing clearcut and readily defined responsibilities; con-
trol and discipline are therefore more easily maintained; action is
quick and time cycles are short; and it is a very stable structure because
the various units of the organization are virtually independent of each
other.

The staff or functional organization in its pure form is most compli-
cated. Each person or group in the organization performs one special-
ized function. The goal of the functional structure is the reduction to

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PRINCIPLES OF GOOD SYSTEMS 25

a minimum of the functions performed by each person. In its pure
form, the staff organization represents the ultimate in functional cen-
tralization. A diagrammatic representation is shown in Figure 7, in
which 16 specialized control and service functions are performed. Each
worker reports to each of the 16 specialist foremen for the different
aspects of his work.

Although not practical in its pure form, this plan has the obvious and
important advantage of having each supervisor an expert in his small
field, enabling greater functional efficiency. The principal drawbacks of
the organizational plan in its pure form are the difficulty of coordinating
the work of the large number of specialists, of fixing responsibility for
performance, and of maintaining discipline amongst workers or groups
serving so many superiors.

Whenever the supervision of any of the organizational units is per-
formed by a committee, some form of committee organizational struc-
ture has been created. The position of the committee may be in the
line, such as the board of directors of a company, or it may be in a staff
or functional unit, such as a standardization committee. Committees
are valuable when expert knowledge from different groups must be
pooled and when required cooperative action is to be promoted.

None of these types of organizations is practical in the pure form.
Combinations of line and staff, with some committees where most desir-
able, is usually the most effective answer. The staff workers then serve
two important functions: they provide specialist knowledge of their
various fields to aid the line executive in carrying out his responsibil-
ities; and they relieve the line executive of a plethora of details which
would prevent him from working effectively. Figure 16 is an example of
a line and staff organization structure.

PRINCIPLE No. 17

A system should be as flexible as possible.

Flexibility and permanence go hand in hand. If the smallest change
in personnel, policies, or product will invalidate the system, the neces-
sity for continual revision of the system will defeat its purpose. Of
course, the system must not be so general in nature as to be ineffective.
The best balance must be reached between the highly generalized,
flexible, permanent, but ineffective procedure and the temporary, highly
efficient, specialized, but inflexible one.

The strength of a system may frequently lie in its flexibility and
ability to withstand change and adapt itself to the normally changing
demands of the business. Although some people confuse rigidity and

26 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

strength, the relationship of the two can be seen by the following
analogy with the winds of competitive enterprise: when a hurricane
strikes, the flexible blade of grass survives whereas the rigid, but
stronger, tree is destroyed.

Flexibility in systems may be achieved from a number of approaches.
The system may be so designed that it will be effective under a wide
variation of circumstances; a system performed at a high level in the
organization is likely to obtain this type of flexibility by providing for
discretionary judgment under prescribed conditions; a system per*
formed at the lower levels should preferably obtain most of this flexi-
bility by covering all possible eventualities with extensive instructions.
(The possible eventualities of changing situations are more easily pre-
dicted at the lower level. ) A second type of flexibility may be achieved
by providing an adequate procedure for changing the system; by hav-
ing stand-by systems prepared and ready to step into a required situa-
tion; by providing a systematic and frequent review of the established
systems so that they can be constantly revised to meet changing condi-
tions. The first type of flexibility is built into the design of the system.
The latter type is dependent on the manner of administration of the
systems control functions in the enterprise.

PRINCIPLE No. 18

The delegation of responsibilities and the establishment of pro-
cedures should not be affected by the special abilities, personalities, or
peculiarities of individual members of the organization.

The significant term in this statement is the word "special." The
abilities, personalities, and specialized skills of generally available per-
sonnel must be the basis of the organization plan rather than the
peculiarities of particular individuals.

There are several reasons for promoting the general application of
this principle. Systems will generally be more complicated when they
must be woven to meet the special organizational pattern which has
been created about the individuals. Systems will be outmoded much
more rapidly if this principle is violated because when personnel shifts
are made, the allocation of responsibilities will have to be changed. In
addition, both the organizational and procedural structures lose
flexibility because of the rigid pattern imposed by the adaptation of
the organization and procedures to one particular set of individuals.

It is, of course, sometimes necessary to make slight modifications in
responsibility allocations to allow for certain abilities or lack of ability
on the part of individuals. But such deviations, when necessary, should

PRINCIPLES OF GOOD SYSTEMS 27

not be allowed to grow extensive or to affect vitally the operating pat-
tern. Whenever they can be avoided, the business benefits.

PRINCIPLE No. 19

The length and the width of the organization structure should be
kept to a minimum.

The length refers to the number of levels of management and super-
vision. The greater the number of levels of authority the longer the
"chain of command" the greater the distance and the time required
for information to travel up and for policy and decisions to travel down
the organization. The coordination problem is thus increased. Top
management is far removed from the workers and their problems.
Moreover, the lower levels of the organization may feel so far removed
from the controlling management of the enterprise as adversely to
affect their incentives.

The width of the enterprise refers to the number of persons report-
ing directly to any one executive. Other things being equal, this num-
ber, known as the "span of control," should generally be smaller the
higher the organizational positions. However, the nature of the busi-
ness and the character of the duties are important variants. It is gen-
erally agreed by most authorities that no more than five to eight sub-
ordinates should report directely to any executive. The danger in
overloading an executive with the direct supervision of too many
subordinates is that he then cannot find sufficient time for his planning
and policy functions. Of course, many more than eight routine workers
can report to a foreman or group leader, the exact number depending
on the kind of work involved.

The twin problems of the length and the width of the organizational
structure cannot be completely disassociated from each other because,
in some cases, to obtain a smaller "span of control" may require a
longer "chain of command." Each application must be decided on its
own merits, taking all pertinent facts into consideration.

PRINCIPLE No. 20

A system should be as automatic as possible.

Expediting and individual judgment should be reduced to a mini-
mum. When the system works automatically, supervision and man-
agerial time is saved. Also, the possibilities of errors of judgment inter-
fering with operations are reduced considerably.

In obtaining maximum automaticity of operations as opposed to
individual judgment, care must be taken to avoid the dangers involved

28 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

in a highly detailed complex system of rules. Such a system may result
in sluggish operations with a high degree of inflexibility.

A corollary to the automaticity principle just mentioned is that a
good system will concentrate attention on variations from standards,
plans, routines, and policies. The ideal system will thus function auto-
matically and will bring managerial attention to any situation which
requires investigation or corrective action.

The system for the accumulation of information on shipments from
the manufacturing plant and the preparation of a regular report of
shipments should work automatically and in the same manner every
day. The reporting form and system should be so organized, moreover,
that any substantial differences between actual and scheduled ship-
ments come to the immediate attention of the responsible supervision
for investigation.

PRINCIPLE No. 21

The delegation of functions and responsibilities to the various organ-
izational units and the specification of procedural methods usually can
be established best by reducing them to writing and distributing these
writings to all concerned persons.

The advantages of establishing the functional delegations by means
of organization manuals and procedural material bjiL. means of pro-
cedural manuals are manifold:

1. By requiring that organizational policy be written, it forces man-
agement to think more clearly on the subjects and to make more
definite decisions. It will also tend to disclose any bad organiza-
tional practices.

2. By making organizational and procedural information available
to all who require it, efficiency of operations is promoted. A person
works more effectively if he knows exactly what is expected of him
and how to go about performing these expected duties.

3. When functions are assigned in writing, unplanned gradual shifts
in activities due to the aggressiveness or lack of aggressiveness of
certain supervisors will be avoided.

4. Responsibility for poor performance can be more definitely fixed
when assignments are in writing.

5. Procedural routine can be more effectively standardized and new
personnel more easily trained when procedures are written.

6. By providing a compact source of information on the organization
and operation of the enterprise, organization and procedure man-
uals, with their accompanying charts and diagrams, provide top

PRINCIPLES OF GOOD SYSTEMS 29

management with an instrument for grasping a picture of the over-
all operating system as well as an ability quickly to ascertain any
details that are desired.

PRINCIPLE No. 22

A good system will have a unity of purpose which it will accomplish
in as simple, clear, and understandable a manner as possible.

Unity of purpose, simplicity, clarity, and understandability are the
usual distinguishing features of a good system as compared to a poor
one. Unity of purpose means direct achievement of objectives. Simplic-
ity results in low operating costs. Clarity and understandability are
necessary if the operating personnel are to be able to follow the system.
A complex system is seldom a good system because it is very rarely
workable.

PRINCIPLE No. 23

Systems must be based on verified facts and not on opinions, guesses,
or false information.

For effective results, the scientific method must be used in systems
work as in most other mundane pursuits. The scientific method requires
the use of established and verifiable facts as the basis for hypotheses
and decisions. As explained in the chapter on obtaining systems facts,
the systems analyst must show exceptional zeal in insuring the accuracy
of his facts because of the ease with which inaccuracies can creep into
a systems investigation.

PRINCIPLE No. 24

In the design of a system, consideration should be given to the falli-
bilities of the personnel who will perform the routine as well as the
imperfections of any machines that the personnel will be required
to use.

No person and no machine is perfect in the sense of never making a
mistake. Of course, some people and some machines make fewer errors
than others. Most systems must be designed so that the expected errors
will be automatically discovered and corrected. In some cases it may be
decided, after careful study, that it is more economical to let the errors
go undiscovered rather than provide in the system for their recognition.
It is always important to remember, however, that people and machines
have imperfections and that it is impossible to predict many of them
with accuracy.

The system should therefore be adapted to the qualifications of the
available workers. Although a good system should not be built around

30 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

the personalities and specific aptitudes of any individual or group of
individuals, it is necessary to take account of the people who will be
available to operate the system. For this reason, good systems practices
will vary in different countries and in different sections of the same
country. Also, systems may become outmoded when the availability of
workers with different skills changes to any marked degree.

In this presentation of the principles of good systems and procedures,
an attempt has been made to present some of the more fundamental
considerations involved in the broader aspects of systems analysis. The
detailed rules for making a systems study and the methods of analyzing
the systems flow, the forms design, the lay-out, the motion patterns, etc.
will be presented later.

The principles outlined in this chapter do not comprise all the gen-
eralized rules which can be presented. Other, and more obvious state-
ments can be added, many of them applicable to all kinds of work
other than systems. As examples: a system should provide for maximum
satisfaction of the creative and achievement instincts of the worker; all
systems should be in conformance with the laws of the nation, state,
and community and should not run counter to the public interest; a
procedure should be in accord with top administrative policy.

No attempt has been made herein to develop a co#*plete and ade-
quate philosophy of scientific management. Such an undertaking would
be outside the scope of this book. Rather, certain general working prin-
ciples have been presented to aid the analyst in creating good systems.

Part II

METHODS OF SYSTEMS ANALYSIS

IV

PLANNING AND FACT-FINDING

bHE AIM of the initial stages of
most systems investigations is to obtain facts. Since the conclusions,
recommendations, and subsequent actions of the systems analyst will
be based on these facts, this stage of the analysis is very important.
Considerable care must be taken to avoid the serious errors which can
easily occur at this stage and which will render all the subsequent
analyses and conclusions invalid.

It is essential that all systems data be:

1. Complete

2. Correct

3. Valid.

To be complete, no pertinent details may be omitted; to be correct,
the facts must be true; to be valid, the data must be applicable to the
situation being studied. Also, in the collection of systems data it is
important to consider the human relations aspects which can negate the
effects of an otherwise brilliant analysis.

31

32 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

SCOPE OF PROJECT

Systems information should be collected in an orderly manner. Be-
fore starting a project, the systems analyst should have the scope of
the investigation clearly defined. He should have a complete under-
standing of the purpose of his assignment. This is necessary to avoid
extensions of the investigation beyond the assigned field. Such exten-
sions are generally harmful because they may cause personnel irrita-
tions; because they may be contrary to management desires; and be-
cause they may delay completion of the assigned work.

A clear and definite picture of his assignment enables the analyst to
approach the problem logically. He is then able properly to organize
his attack on the problem and systematize his methods of obtaining the
required information. By proceeding in an orderly manner, he keeps
back-tracking and waste motions to a minimum. He avoids making
unnecessary contacts and avoids collecting unnecessary information
or unimportant details.

SCHEDULING ACTIVITIES

Having a clear understanding of the purpose and scope of his assign-
ment, the systems analyst should develop a detailed plan of attack.
This advance planning is necessary to avoid uncoordinated movements
in many directions.

The best way of coordinating the activities and eliminating illogical
elements is to reduce the plan to writing and then revise it periodically
as required by new findings. These written plans should include:

1. A list of the required information.

2. Possible sources of this information.

3. Systems staff requirements, such as the assistance of other analysts.

4. A time schedule of the various phases of the investigation.

To insure that all information is complete, correct, and valid, it will
be desirable to check several sources of critical facts; to spot-check data
on a sampling basis whenever practicable; to double-check all informa-
tion which does not appear reasonable.

The information should be collected in a systematic manner: all
pages of notes should be identified with date, title, and source. Records
of the progress of the project should be kept on a current basis.

PLANNING AND FACT-FINDING 33

CRITICAL APPROACH

The systems analyst must always be silently critical and skeptical of
all facts. A fact is considered suspect until it is proven true. This is very
important, because a well-designed system will not be worth the paper
it is written on if it is based on incorrect or incomplete facts.

The problem of correct systems data is complicated because there
may be a number of different answers to the same question: how is a
certain activity performed?

1. The way the supervisor thinks it is done.

2. The way the employee thinks the supervisor wants it done.

3. The way the supervisor tells the employee to do it.

4. The way the instruction manual says it should be done.

5. The way it is actually done.

People mislead not only from malicious intent: they sometimes are
misinformed themselves; they sometimes do not desire to admit their
ignorance and therefore guess at the answer. Written information, of
course, may be incorrect because it is out of date.

The only answer to the accuracy problem is to double-check, by
actual observation whenever possible.

RECORDING THE DATA

When collecting information on the various aspects of any systems
problem, various means of organizing and recording these data may be
employed. In many cases, forms can be successfully employed to sys-
tematize the approach and help insure complete coverage. However, if
forms are used for this purpose, the analyst should not let them channel
and restrict his approach so as to hamper the free use of his imaginative
and analytic powers. Horizontally ruled columnar ruled paper, neatly
headed, can serve equally well as any of these forms and, in addition,
provide greater flexibility and possibilities for novel variations suited
to the requirements of each case.

A form, such as shown in Figure 8, might be used to obtain data on
the productivity of employees. A similar form might be used for obtain-
ing data on the productivity of a machine. Data on the productivity
of the employees might be summarized by a bar-chart diagram such
as shown in Figure 9. A similar chart, such as shown in Figure 10,
might be used graphically to portray the utilization of the various types

34

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

DAIL Y PRODUCTION RECORD

Employee Name Title Dept. Sect Date

Nature of Work

Time

Quantity
Produced

Equipment 8 Forms
used

Stan

Stop

Minutes
Elapsed

Figure 8. Daily Production Record provides data for analyzing personnel
utilization, equipment utilization, productivity, and systems flows.

EMPLOYEE UTILIZATION CHART

QQnt PLAHHINQSepf INVENTORY

Legend-' BBBBB Duties hired for
Tn^/26/so * ^ Hand duties not Hired for
Illlllllllllllllllll Machine duties not hired for

Period Covered-' From *Ms

Hate 1-/8/SO

1 1 1*11*

time

\ \ la 16

Employee

Percent of Time

i

3

40 5

i

6

O 7

80 90 100

ALEX ALLEN

_

>TPNARD &OGEN

z

~

r
L

"

'

Figure 9. Employee Utilization Chart provides a graphic portrayal of how
the personnel of the section is being used.

of machines in a department. These charts point out places where
further investigation and analysis should be made to determine the
causes for poor or misdirected utilization of personnel and/or equip-
ment. Another kind of presentation of this observational data is shown
in Figure 11. This tabulation sheet will help direct attention to the
clerical tasks that take the most time (the cost-per-unit column) and
therefore offer the greatest possibilities for savings. The time-per-unit

PLANNING AND FACT-FINDING

3b

MACHINE UTILIZATION CHART

Qf*p t ACCOUNTING Sect.jp
Period Covered: Frorr

arfto/-L , Legend:

SS!'

Itilized time
lepair time
die time

i /

Machines

Percent of Time

10 SO 30 40 50 60 70 80 9

I t i i i 1 i 1

100

COMPTOMETERS

CALCULATOR <

Figure 10. Machine Utilization Chart, showing effectiveness of machine
scheduling.

PRODUCTION TABULATION SHEET

pmplnyfiA Title Dept. Sect. Week ending

Operation

Time (in minutes) 8 Production fin units)

Time
per
Jnit

Wage
Rate

$%

Cos)
per
Unit

Man.

Tues.

Wed

Thur.

Fri.

Total

COLLATING PUBLICITY
RELEASE

Minutes

Units

MATCHING SALES
TICkT3

Minutes

Units

PQSTIMG GEOGRAPHICAL
RECOUP

Minutes

Units

IOLE

Minutes

Units

RST

Minutes

'

Units

L--- """^

"^

TOTAL

Minutes

Units

Figure 11. Production Tabulation Sheet provides a convenient form for
analyzing the activities and determining the productivity of an employee.

36

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

column tells you something about the efficiency of performance of the
operations. Comparison with others performing the same operation
may reveal valuable clues about the relative effectiveness of machines,
methods, and personnel. These data are also valuable in the determina-
tion of procedure costs.

In a similar manner, forms can be designed for obtaining and sum-
marizing information on various types of equipment practices (see
Chapter IX) file usage, typewriter usage, reproduction equipment,
etc. Data on the designs and usage of forms on the organizational and
flow aspects of procedures, on the detailed activities of each individual
in the enterprise might all be collected on specially designed forms
which help insure systematic and more complete coverage.

/

REPORTS L

1ST

Information Received

Frnm

By

Date

Report Name

Prepared By

Form No.
(if any)

Other Information

\

Figure 12. Tabular Reports List sheet gives listing of all reports, together
with directly related information.

If a report survey is being conducted, the first step might be to obtain
an inventory of all the reports prepared on a Reports List form such as
Figure 12. For each report on the Reports List a sample would be
obtained and- a Report Data Sheet (Figure 13) would be completed to
provide the data for further analysis: are all distributed copies re-
quired?; is the preparation procedure good?; does the cost of prepara-
tion exceed its usefulness?; is the report current enough?; and so on.

The analysis of reports is discussed further in Chapter VIII.

SOURCES OF SYSTEMS DATA

The sources of systems data will vary considerably, depending on
the type of investigation and the past and present practices in the com-
pany. Let us consider some of the more important and normally avail-
able sources of systems facts.

REPORT DATA SHEET

Information received
Report name
Form no. (if any)

Date.

Size of sheets.

No. of sheets.

Why is report prepared / 7_

In formation in report.

Sources of information

Frequency of issuance

How long after fact is report issued PL

How is report prepared?

Periods covered^

How is report duplicated?

Estimated preparation costs Labor Supplies Other^

. Total

Distribution

I

2

J

4

5

6

10.
II .
12.

15 _

16 -

17

18 .

19 _
20-

Place additional data on reverse side of sheet

Figure 13. Report Data Sheet provides information for analyzing various
aspects of the reports for improvement, elimination, simplification, etc.

37

38 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Organization charts and manuals may indicate no more than bare
outlines of the enterprise's organization structure, or give details on the
responsibilities and functions of the departments and their supervisors.

Accounting instructions may provide quite a lot of information on
the existing financial controls and paperwork routines for collecting
cost data. Other written operating instructions, procedures, memo-
randa, and bulletins may also give valuable data. In using this infor-
mation, it is well to keep in mind that it sometimes represents systems
which have since been discarded or which were never even completely
installed.

If a systems department has been in operation many years, its project
files are usually a valuable source of information. The methods de-
partment might also have information on certain problems related to
its work.

Informal discussions with people who are acquainted with the prob-
lems and/or with the persons involved may be very valuable sources
of orientation information. What unusual situations will be encountered
or should be looked into? What personality quirks are to be expected?

The minutes of meetings of production, sales, and other executives,
and of various committees may prove very valuable as indicators of
operating difficulties, of the attitudes of various persons in the enter-
prise, of present methods of operation, and of other possible sources of
more information.

If a forms file is available, it should be consulted for a knowledge
of the forms and how they are used in connection with the systems.
Thorough familiarity with the forms used in the procedures under con-
sideration is very helpful because forms provide the principal means
of recording and transmitting systems information.

Direct observation constitutes the most reliable source of data. The
what, where, and how a thing is done can be observed and compared
with the specifications in operating instructions, if any. The placement
of equipment and personnel and their working methods can best be
determined by direct observation.

The financial and statistical reports of the enterprise may provide
useful data in many surveys. The reports of outside or internal auditing
agencies frequently can be a most fruitful source of information.

In practically all cases, it will be necessary to consult the super-
visory and operating personnel in the enterprise to obtain some or most
of the required information. This source of systems data should be the
last on the listafter all other avenues of information have been ex-
hausted. There are good reasons for investigating all other places first:

PLANNING AND FACT-FINDING 39

1. The analyst will be more certain of the information he requires and
the persons who can supply him with it.

2. The analyst should be as fully informed on his problem as possible
before talking to persons who may be hostile and who will usually
have much greater detailed knowledge than he can be expected to
have. The better informed the analyst is, the more intelligently he
can prepare for and conduct the interviews and the more valuable
they will be. He will be better able to distinguish between fact and
opinion.

3. The time of many of the persons to be interviewed is valuable and
should not be wasted in educating the systems analyst more than
absolutely necessary. In addition, many of these persons will prop-
erly resent having to undertake this education.

In conducting this most important and delicate aspect of the fact-
gathering routine, the analyst must be thorough and skeptical, but,
above all, tactful. His principal problems will be winning the trust and
confidence of the personnel and distinguishing fact from fiction.

Getting along well with the supervisory and operating personnel
constitutes one of the toughest and, in many respects, one of the most
important jobs of the systems analyst. It is one of the toughest because
of the primary hostility which is frequently felt towards systems men.
(The possible reasons for this hostility and suggested ways of dealing
with it are discussed later. ) It is one of the most important because the
best system in the world will not work without the cooperation of the
supervisory and operating personnel. Mr. H. J. Ross tells the following
story: *

"Not long ago I met on a train a Production Manager of a moderate
sized company in the mid-west. When he broke through my modesty
and learned that I was a Systems man we had a conversation that ran
something like this:

" 'So you're a Systems man. Well, well, well. You know I like Systems
men. They're so damn smart. They know everything. Don't they?*

" 'Well, hardly everything.'

" 'Come on, you're just being modest. Don't you know everything?*

"Well, it was obvious that something was 'sticking in his craw.' I
managed to convince him that I was a reasonable creature and that
furthermore I could tell from his manner that he had had an unfortu-
nate experience and 'why not spill it.' So he did.

"His company employed a firm of consultants to survey the manu-

H. John Ross, Technique of Systems and Procedures. New York, Office Research
Institute, Inc., 1948.

40 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

facturing operation and provide a Production Control System which
would straighten out their problems of materials flow, scheduling and
overall control. The consulting firm sent two Engineers to the plant
who spent about two weeks making a survey during which time they
managed to antagonize about everybody in the plant including the
janitor's helper.

"They then left the plant and nothing more was heard from them
until they returned in about six weeks with the entire Production Con-
trol System laid out in several very impressive manuals with beautiful
leather covers and gold embossing.

"They convinced a skeptical Top Management that they had the
answer to the Company problem. With their experience in many simi-
lar plants, and with the facts they had, they were able to design a
top-notch, a humdinger System. They had put a staff of Engineers to
work, each man to a specific phase of the job, and a half dozen men
had come up with the answer in the six weeks' time that they had not
been in the plant. So they were told by Management to go ahead.

"They did. They called the executives together in one session and
explained the plan: A question was answered with 'You'll see when we
get rolling/

"The supervisors were called together in appropriate sessions and
the plans explained. Questions were answered with the same 'You'll see
when we get rolling/

"Then the plan got rolling. In a week's time the two Engineers went
to Top Management and said 'Everything is rolling. It'll be a little
noisy until it gets warmed up. Our contract is fulfilled. Your check,
please. $35,000/

"For a period of about four months Management struggled to get
the new system warmed up but it was no go. It just wouldn't work and
they finally gave up. They gave the plant orders to return to their
former practices and wrote off the $35,000 fee they had paid.

"After the Production Manager was through I made my comment.

" 'How could your Management believe that these Engineers could
design a Production Control Plan without being right there in the
plant?*

" 'Well, you know, that was a strange thing. They really surprised me
with a plan that wasn't too bad. It had a few weaknesses that could
have been worked out in time. But on the whole it was sound/

" *You mean . . . ? I asked.

" 'Yes, sir, I mean,' he said, 'those fellows couldn't have presented
any program that would work in our organization. There was not any

PLANNING AND FACT-FINDING 41

organized conspiracy . . . nobody ever discussed it with anyone else
as far as I know. But every last person in the company below Top
Management was determined that it wouldn't work, and it didn't/

"Now I wish to impress upon you these facts. One this is a true
story. Twoit happens every day. Three it can happen to you."

INTERVIEWING PROCEDURE

It is advisable first to confer with the top officials of the departments
concerned before approaching the supervisory and operating personnel.
These persons should be given a complete story on the purposes and
scope of the investigation and the tentative plan of attack. Their sug-
gestions and cooperation should be invited and any questions should
be answered. If it is feasible, and the departmental officials are agree-
able, direct participation of the departmental personnel is to be invited
and encouraged. This is usually desirable even if, as a result, progress
will be slowed down somewhat. Proposed changes will be received
and installed with much greater enthusiasm by people who have par-
ticipated in their development.

Having invited the suggestions, cooperation, and perhaps participa-
tion of the departmental management and having obtained clearance
to consult with the department personnel, the analyst is ready for
further detailed fact-finding. For success in his interviewing, the ana-
lyst may find the following recommendations helpful:

The analyst should, of course, make an appointment in advance.
Dropping in on a person without advance notice does not usually con-
stitute the best approach.

The analyst should come to the interview well prepared. Even if it
is not shown to the person being interviewed, a written outline of the
desired information should be prepared. Otherwise, the analyst may
not get all the required information; the interview will tend to ramble;
and the analyst may not appear too bright.

The analyst should take notes. They help organize the material in
logical sequence and clarify his thinking. If he doesn't take notes, the
analyst will not necessarily remember everything and may get some
facts mixed up. Facts are more reliable when they are immediately
recorded. The person being interviewed might even consider it insult-
ing if written notes of his "words of wisdom" are not being written
down, especially if he feels they cannot all be remembered. Moreover,
if the analyst did not take notes and then had to call the person back
to verify some facts, the reaction might not be too pleasant

42 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

A good rule to follow in systems interviewing is: Be a good listener
first and a good talker second; do the most listening and least talking
that you can manage. As an analyst you learn more that way and the
person you are interviewing will like you more for being a good
audience.

If the analyst can conveniently learn in advance about some of the
personal characteristics of the people to whom he is going to talk, he
can be better prepared to cope tactfully with the interview situation.
In every case, there are a number of general suggestions which can be
made to a prospective systems analyst. These suggestions are intended
to avoid some of the mistakes which many systems men have made
while learning their profession. Many of these men who have been
very successful in systems work made some of the serious errors in
dealing with personnel about which the reader is presently to be
warned. However, they quickly realized the error of their ways or they
would not have lasted too long in their profession.

In contacting the personnel, the systems analyst would do well to
understand the primary hostility with which he may be received. Some
people have the misconception that a systems analyst is a disreputable
efficiency expert a smart aleck who messes things up, makes people
work harder, and gets them fired. Other persons resent having a sys-
tems man intrude on their time and interrupt their work. Most people
feel that they are performing their work satisfactorily and don't like
anybody else snooping. Most people are naturally fearful of change.
Moreover, here and there in a very large organization will be found
a few people who have what they consider soft jobs or rackets which
they are desirous of protecting. Most persons, other than those in the
last category, can be won over by tactful handling. Misconceptions
can be clarified by a friendly and sincere approach.

Your attitujie should always be a sincere desire to do your job as
best you can without hurting anybody else to reduce the pressure of
work, make work easier, eliminate unnecessary work. Try to talk in
terms of the other man's interests. Show how what you do may prove
helpful to him. Attempt to get him to share in your project. Find out
what he considers wrong with the way things work at present. Even if
you don't agree, show a sympathetic interest and respect for his
opinion. When his ideas are good, be sure that he gets recognition for
them.

Although you should be skeptical of everything, you should never
allow this skepticism to be transmitted to the personnel or you will be
considered a faultfinder. Never give the impression that you know a

PLANNING AND FACT-FINDING 43

lot. Always imply that the person being interviewed knows more about
the work than you, the analyst, do. The person usually knows more
about the details of the work anyway. Don't find fault or criticize the
way things are done. Never tell anybody he is wrong and don't criticize
anybody else in the organization. It will always get around to the other
person. Nobody ever won an argument in systems work. Therefore,
don't argue. You lose if you lose the argument and you lose even more
in the resentment of the other person if you win.

In the Appendix to this chapter is given a practical case illustration
of an interview to indicate by example some of the proper techniques
for securing good interview results.

Although an attempt has been made to suggest how to get along
with people because of its prime importance in systems work, getting
along with people cannot be reduced to a set of rules. Getting along
with the personnel of the enterprise depends more on the attitude and
intelligence of the analyst than observing any set of rules. A friendly
and pleasant manner and an unpretentious spirit, coupled with a gen-
uinely helpful interest in the other person, constitutes the successful
combination.

WRITTEN QUESTIONNAIRE

For certain specialized systems investigations, the questionnaire
method of obtaining information may be valuable. For most surveys
the use of questionnaires is not to be recommended because

1. The personnel object to answering numerous, time-consuming, and
tedious questionnaires.

2. It is difficult to design questionnaires which will insure obtaining
exactly the information desired. Many of the answers received from
elaborate questionnaires will therefore be inadequate. As a result,
the interview technique will have to be used in addition to clear
up doubtful points.

3. The clerical expense to the enterprise of a continued, large volume
of questionnaires is rather large.

4. The questionnaire method is relatively slow because many persons
put off answering the questionnaire for some time. This also neces-
sitates considerable personal expediting of replies.

The questionnaire method is most valuable when a very small
amount of information is required from a large number of persons or

44 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

when a systematic study is being made of all the activities of one unit
of the organization.

The systems questionnaire is in reality a temporary form and care
should be taken in its design to conform to the principle of good form
design outlined in Chapter VIII. The questions should be worded so
that no misinterpretations are possible and no biases will be present
in the replies. The introductory remarks in the cover letter should
adequately explain the purposes of the questionnaire in order to avoid
misunderstandings and to help solicit cooperation. It is usually a good
idea to indicate a reasonable date by which return of the questionnaire
is desired.

REPORTS QUESTIONNAIRE

A survey is desired on the distribution and usage of certain widely
distributed reports in order to insure the inclusion of only useful in-
formation, to eliminate unnecessary recipients, to save the time of the
recipients, and to reduce the costs of preparation and distribution of
the reports. A questionnaire reading somewhat as follows might be
transmitted to each recipient of each report.

"You are currently on the distribution list for _

As part of our program for improving the effectiveness

of reports and reducing unnecessary expenses, we are surveying the distri-
bution of various reports to insure that they contain all the required in-
formation; to eliminate unnecessary information; and to restrict the dis-
tribution to those who really require each report. We would appreciate your
cooperation in this program by answering the questions listed below. Please
return your answers by .

1. Do you presently require this report? Yes No .

2. If you do, what information do you use?

3. How do you use this information?

4. What additional required information do you think should be in-
cluded in the report?

5. How would you use this additional information?"

Before embarking on a report analysis program such as is suggested
above, it would be desirable, of course, to call a brief meeting of the
top executives of the affected departments to explain the purposes and
scope of the survey and to solicit their suggestions and cooperation.
Most reports are prepared on forms and are integral parts of estab-
lished procedures. The analytic methods presented later therefore
apply to their analysis.

PLANNING AND FACT-FINDING 45

DUTIES QUESTIONNAIRE

It has been decided to survey all the activities of the inventory-
control section to ascertain what improvements can be made in operat-
ing methods. At a preliminary conference of the analyst with the sec-
tion supervisor, the supervisor of the section is acquainted with the
proposed plans, his part in the plans is discussed, and his ideas are
solicited.

With the cooperation of the systems analyst, the section supervisor
later prepares a list of all the activities of his section as well as a list of
all the jobs in his section and the number of employees in each job.

DUTIES QUESTIONNAIRE

Nome Dote

Title Dept Sent

No.

Duty

Hrs./Wk.

I

2

3

<

\ \

*

Verified by; (Supervisor) Dote

Figure 14. Simple Duties Questionnaire provides the basis for a valuable
analysis of the activities of a department.

To obtain a detailed story on the activities of all the individuals in
the section, a duties questionnaire is prepared such as shown in
Figure 14. Many variations of this form may be used, depending on
the exact purposes and details of the plan of analysis. In this case, the
personnel of the section would be called into a conference room and
the supervisor and the analyst would explain the purposes of the
survey. The questionnaire would then be distributed and instructions
given on how to complete it.

In the questionnaire each employee is requested to list his duties
and the average amount of time he estimates he spends on each one.
In many instances, the estimate of average weekly hours cannot be

46 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

very accurate. This should not trouble the analyst too much. He realizes
that the uses to which he will put the data, as explained in the next
chapter, do not require any great accuracy. It will usually be ad-
visable to explain this to the personnel. It might also be well, in some
cases, to explain how to go about estimating average weekly hours by
averaging over a period of time.

This questionnaire is designed for use in the Activity Analysis Chart
discussed in the next chapter and is kept simple by asking for the
minimum required information. It may sometimes be valuable to re-
quest additional information, such as:

1. Lists of all forms and reports connected with the work and the
information obtained and the operations performed upon them.

2. Lists of all machines used.

3. Lists of unusual, out of the ordinary, duties that seldom occur and
therefore cannot be conveniently listed among the regular duties,

4. Lists of suggestions for improving working methods.

This information is later checked and verified by the employee's
immediate supervisor, who will not usually make any changes but will
point out any discrepancies to the analyst. Changes should ordinarily
only be made by the systems analyst. In addition, these actual duties
lists should be compared with any job description specifications which
may exist. However, employees should never be downgraded as a re-
sult of such a comparison, although future replacements should be
made at the correct job grade. The information obtained in this manner
will later be analyzed in accordance with some of the suggestions
contained in the next chapter.

If more detailed and exact information were desired on the work
and activities of each individual, the questionnaire approach would
not be used. Instead, direct observation and independent timing of
the various activities being performed would be called for.

PLANNING AND FACT-FINDING 47

APPENDIX

CASE ILLUSTRATION OF INTERVIEW *

(to obtain the initial consent and cooperation of an operating chief who
is opposed to the idea of having a procedures study made in his unit)

THE FACTS

The person to be interviewed is a Mr. Doe, the chief clerk of a fiscal
section charged with preparing important fiscal statements. Mr. Doe is
a man of about forty-five years of age, has worked in this unit for some
fifteen years, and has been in charge of the unit for the past ten years.
Mr. Doe, though regarded as a conscientious and competent worker, is
very set and narrow in his views and is very much opposed to the whole
idea of procedures studies. While Mr. Doe's unit has almost uniformly
given good service, it has been noted that in recent months he has
failed consistently to make his statement deadlines, and several errors
have crept into his statements, a thing which had previously never
happened. The unit puts out various reports, three being of paramount
importance: the "Statement of Disposition of Funds," the "Operations
Report," and the "Budget Report." These three reports occupy the
greater portion of the time of Mr. Doe and the eight clerks who com-
prise his operating staff.

Purpose of the Interview

The purpose of the interview is to (1) break down the resistance
which Mr. Doe now has towards procedures studies, (2) to by-pass
Mr. Doe with his unconscious consent, and to engage in direct discus-

* From: Quartermaster Control Officers' Handbook, Army Service Forces, Office of
the Quartermaster General, November, 1943.

48 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

sion of these reports with his two chief assistants, a Mr. Black and a
Mr. Brown, (3) if possible to get Mr. Doe's active cooperation in the
conduct of a procedures study with respect to the work of his unit.
Two previous attempts to make appointments for interviews have
failed, but the analyst has at last succeeded in arranging an interview.

The Plan of the Interview

1. An attempt will be made early in the interview to reassure Mr.
Doe that his position will not in any way be challenged by the
procedures analyst.

2. An attempt will be made to engage Mr. Doe in a free discussion
of the work and problems with which he is faced.

3. The analyst will try to get across to Mr. Doe the idea that all sug-
gested improvements will be cleared directly with Mr. Doe, and
that Mr. Doe will get at the very least a major share of any credit
for the installation of improvements.

4. The analyst will attempt to convince Mr. Doe that his only inter-
est is to be of real help and assistance to Mr. Doe and his unit.

5. At the proper moment, the name of Mr. Red will be introduced.
Mr. Red is a close personal friend of Mr. Doe's and the analyst
has just concluded a very successful study in Mr. Red's unit and
now has the high regard and cooperation of Mr. Red in his work.

6. A definite attempt will be made to establish a direct line of con-
tact with Mr. Black and Mr. Brown, with the consent of Mr. Doe.

Conduct of the Interview

ANALYST (coming up to desk): Good afternoon, Mr. Doe. I appre-
ciate your giving me this time. I know how busy you are and I'll
try to take up as little of your time as I can. I know it's no easy job
to run an accounting job such as you have here without keeping
on top of it all the time.

MR. DOE (very tense and openly unfriendly): Good afternoon, Mr.
White, and since you bring the matter up, I don't mind telling you
that the idea of having a procedures study in my unit at this time
doesn't appeal to me at all. We're up to our ears in work, and I just
can't see how we can afford to let you take up the time of either
myself or any of my clerks by asking questions and trying to find
out information. If you want my honest opinion, I think this whole
idea of procedures studies is just a lot of highfalutin nonsense.

PLANNING AND FACT-FINDING 49

[The analyst is trying to put Mr. Doe at ease by assuring him that the analyst
realizes how busy he is and by inference, indicates that the analyst realizes
the importance of his position. Mr. Doe, however, reacts unfavorably. His
statements indicate that he is still very opposed to procedures studies.]

ANALYST: Mr. Doe, I appreciate your frankness, and in your position I
would probably feel exactly the same way. I have had that state-
ment made to me by several of the best operating chiefs in this
office, and not without reason. It does seem difficult to believe that
I could be of any possible assistance to your operation, especially
since you have had such a long experience in this work. I am very
willing to admit that I don't know very much about accounting
or accounting statements. As a matter of fact, Mr. Red down in the
Statistics Section you know Mr. Red, don't you? . . .

MR. DOE: Yes, I know Mr. Red very well; he's a personal friend of mine.

ANALYST: Well, Mr. Red said almost exactly the same thing to me when
I first went into his unit, but I think you'll find that he has a some-
what different idea now. And the funny part of it is that I didn't
do anything for him except to follow his directions. That was cer-
tainly an interesting job. I know that you're pretty well pressed for
time, but since you are a friend of Mr. Red's, I wonder if you'd like
to hear about it it will only take me a minute or two to dis-
cuss it.

MR. DOE: Well, of course, I'd like to hear about it, but I don't know as
I can spare even a few minutes now. Besides, I'll probably see
Mr. Red this Friday night when we go bowling and he can tell me
all about it then.

[The analyst does not attempt to counter Mr. Doe's unfavorable statement by
a headlong denial. Instead he agrees with Mr. Doe, but agrees only in prin-
ciple. He tells Mr. Doe that he fully appreciates his position, implies that all
of the "best operating chiefs" have a similar reaction, and, therefore, there
is not any criticism to be leveled at Mr. Doe for sharing their attitude. How-
ever, he softens, and to a large extent voids, Mr. Doe's objection as to any
lack of knowledge on the part of the analyst by citing an identical instance.
Mr. Doe admits that he is a friend of Mr. Red's. Therefore, he cannot now
with any good grace deny interest in Mr. Red's problem.]

ANALYST: Well, that's probably so, but what I'd like you to know is that
the major share of the credit for this idea belongs to Mr. Red, and
I know that he is too modest to tell you the whole story exactly as
it happened. (Without waiting for an interruption) You see, some
people thought that Mr. Red wasn't getting his figures out fast

50 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

enough for them to be completely useful but they didn't begin to
realize his problem. Mr. Red got the figures out quickly enough,
but when he sent them down to the central stenographic depart-
ment, they just didn't get around to doing them until maybe two
or three days after he sent them down, and it wasn't their fault
either since they just can't get any more help. Well, there we were
with Mr. Red getting the blame by thoughtless people who didn't
know the whole story for something over which he had no control.
You see, what they had to do in the central stenographic depart-
ment was to type up handwritten draft reports on to ditto masters
and then have them duplicated. We tried everything, and just
when we were about to give up, Mr. Red got the idea of using a
handwritten master ditto form that we could use again each month
just by filling in an additional line of figures. In that way we used
the same master sheet for a whole year and saved all that head-
ing-up and recopying time. In addition to that, since we ran them
off from the handwritten master ditto, we were able to get the
figures out within two days after the end of the month. So you see
that sometimes, especially if we get the benefit of the experience
and knowledge of the operating chief, we are able to work out
some little improvements that are really effective.

[The analyst is now attempting to do several things. First, he is introducing
and building up Mr. Red as a "character witness." Secondly, he indicates that
he will not attempt to build up a reputation at the expense of operating
chiefs, since Mr. Doe knows very well that Mr. Red probably had very little
to do with the improvement described. In addition, he places the burden for
the effecting of improvements on the question of cooperation from the
operating chief. Finally, he shows very clearly that his lack of knowledge of
the particular operation does not always prevent the achievement of real
benefits from the procedures study.]

MR. DOE: Well, that's very interesting, but, as you know, our problem
here is very different from that of the statistics group. We don't
have any duplicating problem; in fact, our principal work is get-
ting up operating statements. We don't face any typing difficulty
because we have a long-carriage typewriter right here in the office
and my secretary bangs out our statements. On those statements
that are duplicated, she uses a ditto master and if she can't get
them run off during the day, she does it herself after hours.

ANALYST: You're very fortunate to have such a simple problem so far
as duplication is concerned. And I think that your girl must cer-

PLANNING AND FACT-FINDING 51

tainly be interested in her work to take that trouble. It's been my
experience that that's one of the best signs about a unit, to have
people really interested in the work they're doing. As a matter of
fact, I imagine an intelligent girl would really be interested in
helping to get out statements like your "Monthly Operating Re-
port," for example, or the "Budget Report." Does she do anything
besides typing in connection with these reports?

[The analyst makes his first real gain. Mr. Doe is talking, however grudgingly,
about the work of his unit.]

MR. DOE: Well, she's a good girl, but as a general rule I don't let her do
anything except type these statements up. After all, we can't have
untrained help fooling around with statements such as the ones we
get out. Once in a while I let her run off a trial balance or some-
thing of the sort, but usually she's kept busy enough with our
routine correspondence and with statement typing. That's another
reason why I don't approve of this procedures study. My girl takes
dictation on a regular schedule from these men throughout the day
because we try to plan our work. If you come in here and start
interviewing and taking up time, you're going to get us all off
schedule and the only result will be that we're going to have to
go into additional overtime. That's one of the things the big chiefs
around here don't seem to realize. Only a year ago we had one of
these procedures studies and they tried to take away two of my
people. Why, the whole thing was so ridiculous I wouldn't even
discuss it. I understand that you mean well, but since my operation
is satisfactoryand if it wasn't I would have heard about it by this
time I don't see any reason why you should tinker with it. We
worked very hard getting up the procedures we use now, and they
do the job in a way that satisfies us. Not only that, but my clerks
have been upset for a week because they heard that this procedures
study was going to be made. I told them only the other day that
they didn't have to be worried because I didn't approve of the
idea and that any study of this unit that was made would be made
right here at my desk.

[Mr. Doe is still opposed to the idea of procedures studies. But it will be
noted that he is not nearly so forceful in his expressions as he was at the very
beginning of the conversation. He is giving reasons for his opposition, reasons
which have real merit and must be considered on that basis. However, his
last statement poses a very difficult problem for the analyst, for in some way
Mr. Doe must be given an opportunity to revoke his declaration about no

52 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

survey being made without too much loss of prestige in the eyes of his sub-
ordinates.]

ANALYST: I'm sorry to hear that your employees are upset, because my
job depends on how well I serve not only you but all of the people
in our organization. I know that you yourself, from having done
procedures work, realize that procedures work is necessary in
any large organization. Furthermore, as you must know from your
own experience, it is often possible for an outsider to come in and
get an idea that may be beneficial to a unit. Perhaps he may not
be able to develop it completely, but it can often be perfected by
the operating chief and his assistants through their own knowledge
and experience. I am sure that if we worked on the basis that I
became a part of your unit and took no action that you did not
know about beforehand, we would be able to conduct a very
pleasant and perhaps a profitable study. It's very possible that
nothing can be improved in your unit, and if that's the case, don't
you think that your position would be strengthened with your own
chiefs if some disinterested party like myself could go on record
to the effect? Really, Mr. Doe, while I certainly will not press the
point against your wishes, I do think that there is no possibility
that you could do anything but benefit by having me work here
under your direction. I feel that all the arguments you've advanced
are very reasonable and deserve consideration, but you can appre-
ciate my position in the matter.

[It will be noted that the analyst completely ignores Mr. Doe's statement that
there isn't going to be any survey conducted in his unit. He again repeats the
comments made about working under Mr. Doe's directions, about Mr. Doe's
previous experience, about Mr. Doe's logical and reasonable approach, and
puts Mr. Doe in a position where, if he disagrees with the analyst, he will be
in effect stating that he is not a reasonable and logical person.]

MR. DOE: Yes, I see your point of view, but after ah 1 , I'm responsible for
this operation and I just can't afford to let anything stop us from
getting out the work. After all, that's our job and one of the things
I want to do is get it out quickly and without any overtime. Now
last week, for example, I worked down here three nights getting
up a statement. That has to be considered, too. We just don't have
any time to spare.

[Mr. Doe is now weakening rapidly, although he is not aware of this fact. His
argument has changed completely from one of principle to one of expediency.
He is no longer arguing about the basic principle of whether or not a pro-

FLAMMING AND FACT-FINDING 53

cedures study should be made, but is instead arguing that regardless of
whether it is good or not, he does not have the time to devote to it. This is a
very critical phase of the interview.]

ANALYST: Mr. Doe, that is perhaps one of the best reasons why you
should have a procedures study now instead of later. You're often
faced with the problem of overtime work, and it's bad enough for
your clerks who get paid for it, but I think it's even more unfair
to you because you don't get paid for it. It may be that we won't
discover any one big thing worth mentioning in a procedures
study here, but we might turn up a few little things that might
be sufficient to cut down on that overtime business. And while you
don't have too much overtime in your unit, I know that you would
prefer not to have any at all to show up for your group on the
monthly overtime statement. I think it's the "Monthly Operating
Statement" that calls for most of the overtime, isn't it?

[The analyst now introduces two real benefits that might accrue to Mr. Doe
through a procedures study. One of these is the elimination of overtime in his
unit (overtime for which Mr. Doe personally does not get paid); the other
benefit is that Mr. Doe's unit will show up more favorably to the top execu-
tives so far as overtime payments are concerned. The analyst also repeats his
assurance, by inference, that no attempt will be made by him to build up a
striking report at the expense of Mr. Doe, by referring to "a few little things/'
etc. The analyst also introduces a specific question about a specific statement.
If Mr. Doe answers that question, then the rest will be relatively easy.]

MR. DOE: Well, we don't have too much overtime, but most of it is
when we work on this "Monthly Operating Statement.'* That's a
rush job you know, and we can't take too long to get it out else it
won't be worth anything to the people who get it.

ANALYST (interrupting): Yes, I can believe that. I've seen some of those
statements, you know, and they certainly give a very complete
picture of everything significant about our operations. It must take
a lot of real work to get that statement out. And that "Disposition
of Funds Statement" doesn't look like an easy job either.

[The analyst is now moving in fast. He at last succeeds in getting Mr. Doe to
discuss the work of his unit, and in particular the principal products of his
unit. The analyst is not going to refer directly again on his own account to
the question of his conducting a procedures study. He is going to proceed on
the assumption that Mr. Doe has given his tacit consent and is now going to
try to work in more deeply to the point where Mr. Doe will call either Mr.
Black or Mr. Brown to carry on the conversations. At that point, the pro-
cedures study will have formally begun.]

54 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

MR. DOE: Well, the "Monthly Operating Statement" and the "Disposi-
tion of Funds Statement" are about our two biggest ones. And all
the divisions are pretty anxious to get them. Only yesterday, Frank
Smith of Procurement called me up to find out when he'd get his
copies.

ANALYST: Yes, I know he's very keen on those reports. And Mr. Blue
down in the Budget Bureau told me that your "Disposition of
Funds Statement" was almost as important to him as the "Budget
Report."

[The analyst is still hitting hard. He indicates that he is fully aware of the
importance of Mr. Doe's work to the organization, and Mr. Doe cannot do
anything but accept his comments as indicating a real interest and apprecia-
tion.]

MR. DOE: Oh, sure. Mr. Blue's on my neck if we're even a day late with
it. You know he helped me to make up that statement about three
years ago when we first went over to the new method on funds
allocation. We eliminated four other reports and replaced them
with this one form. That saved a lot of work.

[Mr. Doe relaxes. It is evident that the analyst is beginning to get his con-
fidence, principally because the analyst has stressed that the chief products of
Mr. Doe's unit are fully understood and appreciated by him. Mf. Doe now
wants to show that he is also progressive and can effect improvements.]

ANALYST: Yes, that must have been a fine job. I heard about it from
several people. In fact, one fellow told me that if you had the time
to do it, you could probably effect still further improvements in
these statements, but that he wondered if you ever had any time
to spare, in view of the way your work has been increasing. It's a
time-consuming job, as you well know from your own experience.

[The analyst now gives Mr. Doe a logical reason as to why he has not been
able to effect further improvements namely, the fact that he has not had the
time to do it. The inference is that it is this fact alone that prevents Mr. Doe
from putting in further improvements.]

MR. DOE: You're right about the time question, all right. Why, only two
days ago the chief came to me and told me we had to get out an
interim statement on all purchases of furniture, office machines,
and equipment for the past two years . . . (Mr. Doe goes on for a
few minutes on various incidents related to special rush jobs that
were put on him without any warning and which required a great
deal of work.)

PLANNING AND FACT-FINDING 55

[Mr. Doe is still just a little bit defensive, but here is an "out," a face-saving
angle that he hadn't previously thought of himself, the fact that he "hadn't
had the time."]

ANALYST (listens intently, awaiting a favorable moment to move in
again towards the objective of the interview): Well, that certainly
was good performance in my opinion. With all of these reports,
and with such a shortage of skilled help, it's no wonder you have
to work overtime occasionally. However, I am sure that you must
have some general ideas as to where improvements might be made
to save overtime, and what I suggest is that you outline these ideas
to me generally and I can dig into them for you. Naturally, 111
clear any ideas I may get with you, so that I won't be going off the
beam with regard to any rules or regulations that I might not
know about.

[The analyst again stresses one of the benefits that the study may bring to
Mr. Doe. He also advances to the point where he is discussing the method by
which this study will be conducted, and if Mr. Doe does not challenge him
now, then the analyst has clear sailing so far as the study itself is concerned.]

MR. DOE: I'm glad to hear you say that. A lot of people think that this
accounting routine is a cut and dried proposition, but you'll
see that there are a lot of angles to it that don't appear on the
surface.

ANALYST: I'm certain of that. I know very well that there are a lot of
technical details to this kind of work, and you can be sure that I
will check with you every step of the way. The one report that
appears to me to be the most technical of all is that "Disposition of
Funds Report." It looks like an interesting report, and I think that
111 enjoy very much finding out exactly how you make it up. I
think you have Mr. Black work up all the preliminary figures for
you, don't you?

MR. DOE: Yes, Black does do a lot of the detail work on that report.
He does a good job, too. I know, because I trained him myself and
he's had about three years' experience with it. He's worked on it
almost from the very day we put it in, and he can answer many
of the detailed questions on it a lot better than I could myself.

ANALYST: Well, what I would like to do, if you are agreeable, is to
work with Mr. Black for a day or two to make sure I understand
this statement, and then if we get into any difficulty or come up
with anything that looks goocj r j*ejtfill check back with you. How
would that be?

56 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

[The analyst is in! Mr. Doe is discussing the very subject matter of the study
with him.]

MR. DOE: Why, I think that would be a good idea, and I think Black
will be able to answer most of your questions. Ill get him over
here. (Raises voice) Black, have you got a minute? . . . This is
Mr. White, and he's going to work with you for a few days . . .
etc. . . .

What the Analyst Did

1. He made an appointment for the interview.

2. He quickly indicated his recognition of the fact that Mr. Doe
had an important and difficult job.

3. He built up Mr. Doe's prestige by inferring that all Mr. Doe
lacked, in order to effect improvements, was the necesary time.

4. He showed a sincere appreciation of the problems facing Mr.
Doe.

5. He indicated the possible benefits to Mr. Doe that might result
from the study.

6. He gave a "character witness" who could testify to the success
of his work.

7. He implied that he would not seek to build up a "reputation"
at Mr. Doe's expense.

8. He offered to clear all ideas and possible recommendations with
Mr. Doe.

9. He stated that he would consider himself a member of Mr. Doe's
staff for the duration of the study.

10. He did not allow himself to be drawn into argument with Mr.
Doe, regardless of the provocation. Instead of attempting to beat
down the objections offered, he (a) ignored them, (b) side-
tracked them, or (c) turned them to his advantage.
As was stated above, this illustration is given, not as a complete guide
to interview technique, but rather to indicate in a general way the man-
ner in which an interview can be used to further the object of a
procedures study.

V

ANALYZING THE FUNCTIONAL
ALLOCATIONS AND SYSTEMS FLOWS

kT THE SAME TIME as the

systems analyst is gathering his facts, he will want to organize his
thinking about these facts. What do they mean? Is the present pro-
cedure good? Can it be improved? Would a certain suggested alterna-
tive procedure be better?

In this chapter we want to consider some techniques for organizing
systems data so that they can be more readily analyzed. These tech-
niques are general methods which can be used for analyzing detailed
systems problems as well as the more general systems flows.

If an analysis were made by merely observing how things were done,
quite a few improvements might be made by a superior, well-trained
systems analyst. The analyst would wait for ideas to occur to him
while he observed. Having a great familiarity with systems, a good
memory, and a keen, fertile mind, a number of improvements may
occur to him. However, many more ideasperhaps even better ones-
will occur to this same analyst when he follows a systematic method

57

58 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

of analysis. He will then be better able to evaluate the worth of his
ideas. Also, in evaluating the ideas for his own benefit, the analyst
will be preparing his sales arguments which he will later require when
presenting his case to management and to the personnel of the enter-
prise.

The methods here outlined provide not only for a systematic ap-
proach to aid in discovering the maximum possible improvements.
They provide also a means for obtaining a complete picture of a com-
plicated system which could not otherwise be grasped without rela-
tively long and diligent study. These charts are also invaluable for
demonstration and instructional purposes.

The number of different possible approaches to this problem of
analyzing systems facts is infinite, and for no two problems is the
best approach the same. There is no substitute for individual initia-
tive and inventiveness. In this chapter we will attempt to explain
some of the more general analytic methods which have given success-
ful results in a large number of applications.

Analysis of systems facts involves breaking the procedure down
into small basic units of uniform size. How basic these units should
be how small a unit we want will depend on the purposes and scope
of our investigation as well as the amount of available time for its
completion.

The basic approach in all of these analytic techniques is:

1. Arrange the information in accordance with some graphical or
tabular scheme which will make the systems arrangement clear
and understandable and perhaps highlight the existence of certain
possible flaws.

2. After the arrangement has been completed, critically analyze the
picture thus presented in terms of the general principles previ-
ously presented' as well as corollaries to these principles which will
be mentioned later. The analyst must continually throw skeptical
questions at himself as he carefully examines his analytic chart.
Some of these questions will be suggested in the following dis-
cussions.

3. Chart the new proposal suggested by the analysis so as to highlight
comparison with the existing system.

Since systems decisions must fit enterprise needs, suggested answers
in the illustrative applications here are not necessarily correct for other
companies. Such decisions must be tailor-made to fit.

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 59

FUNCTIONS ALLOCATIONS CHART

The Functions Allocations Chart is a simple means for graphically
portraying and analyzing the allocations of functions to the various
units of the organization.

The chart consists essentially of a conventional box organization
chart with a listing under each box of the functions and activities of
that unit. The amount of detail to be included in each listing depends
upon the purposes of these investigations and how detailed the or-
ganizational break-down is to be. If the entire enterprise is being
charted, a much less detailed break-down of the organizational units
would be made and the break-downs of the activities would not be
very minute.

A Functions Allocations Chart for a multi-plant manufacturing com-
pany employing approximately 20,000 persons is shown in Figure 15.
To keep the chart to a reasonable size for inclusion in this book, the
detailed break-downs of the organization and of the activities performed
by each unit are given only when thought necessary for illustrating the
analytic techniques and principles. In actual practice, using a large
wall-size chart, the organizational structure and the activities per-
formed by each unit of this structure should be broken down to a
uniform degree of detail commensurate with the purposes of the in-
vestigation. This chart is then analyzed in accordance with some of the
principles developed in the preceding chapter.

KEY QUESTIONS

The analyst analyzes each activity and group of activities separately
and as a group and asks himself many questions such as the following:

1. Are all functions and activities required for most successfully at-
taining the desired , objectives allocated to some organizational
unit?

2. Are any unnecessary functions or authorities allocated?

3. Are these functions and responsibilities allocated so as to provide
logical and harmonious groupings for achieving the desired objec-
tives?

4. Are similar activities grouped close together?

5. Are functions which depend upon and service each other grouped
close together?

6. Are functions which act as controls or checks on other activities
placed in groups which are independent of the activities?

General Manager

Accounts and Finance I

Order acceptance
Pre-production

scheduling
Bill of material

preparation
Factory scheduling
Plant and machine

loading
Detail material

ordering
Procurement
Vendor expediting
Receiving
Inventory control
Expediting - stock,

tool and product
Stores

Tool storing
Dispatching
Material moving
Shipping control
Production performance

reports
Scrap or surplus

material disposition
Engineering change

execution

General accounting

Accounting statements

Internal auditing

Real estate

Accounts receivable

Payroll

Accounts payable

Insurance

Fixed assets accounting

Tax compliance

Credit and collection

Budgetary control

Systems and organization

control

Systems auditing
Equipment control
Office layout

Purchasing policies
Development and approval

of supply sources
Purchase contracts
Placing purchase orders
Expediting deliveries
Incoming materials

inspection

Inspection

Inspection
Test
Time study

Planning & scheduling
Cost estimating
Bill of material

Plant Accounting

Plant Services

Factory expense budget
Factory payroll
Cost accounting
Production cost estimating

General plant maintenance
Machinery maintenance

(repairs and preventive)
Planning and scheduling
Plant and facilities

(design and estimating)
Pover plant operation
Mail, telephone, guard,

elevator and receptionist

services
Cleaning

Product Line A

Fabrication

Sub-assembly

Assembly

Finishing

Final packing

Shipping

Timekeeping

Figure 15. Functions Allocations Chart provides summary picture of

60

Public Relations

Legal, Inaurance 1
and Real Estate |

Engineering 1

1

Parts and Servicing

Sales and Personnel

Product eervice
Replacement parts

Sales planning and

forecasting
hferket development

and policies
Product development
Advertising
Selling
Market analysis and

consumer research
Customer relations
Warehousing - finished

goods
Traffic
Printing
Employment
Labor relations
Wage and salary

administration
Safety

Training and education.
Employee morale
Medical service
Personnel Insurance

and compensation
Employee sales

Design

I Services I

Drafting
Blueprinting
Library
Engineering models

Methods

Mfg. methods- prod *n,

test, & packing
Machine development
Trouble shooting
Prod'n models & samples
Tool design & estimating
Tool construction
Material & labor cost

standards

Make or buy policies
Plant layout
Mfg. order Issuance

Product Line B

Same as Product Line A

Product Line C

Product Line D

Same as Product Line A Same as Product Line A

distribution of functions among the organizational units of the enterprise.

61

62 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

7. Are the same responsibilities given to more than one group?

8. Have activities which must be performed in sequence been placed
together, especially when the time element is important?

9. Have the advantages of centralization and decentralization been
properly balanced against each other?

10. Does each group report to only one superior?

11. Have personalities entered into the organizational determinations?

12. Have the "span of control" and "chain of command'* been kept to
a minimum?

13. Does the organizational structure provide adequate flexibility?

ANALYSIS OF FUNCTIONS ALLOCATIONS CHART

In answering each of these questions, the analyst must utilize a
knowledge of many facets of the enterprise's operations which are not
here presented, as well as his accumulated knowledge and experience
from years of familiarity with the operations of many enterprises. He
must discuss many of these questions with operating personnel to find
the correct weights and balance for applying these principles. What is
important in one enterprise may not be quite so important in another.

Some of the answers to the questions asked by the analyst are given
below. These answers are incomplete from two points of view: only one
violation of each principle is presented; the explanation of the reason-
ing involved must, of necessity, be incomplete.

1. Are all required junctions allocated?

Some aspects of the quality-control responsibility are not allocated to
any group. The inspection department is charged with the job of
physically testing conformance of the product with the engineering
specification. However, the job of quality control includes the establish-
ing of the most economical inspection policies which will be used to
insure that customers receive a given quality of product, to correct
weak links in the manufacturing process which are causing or will
cause quality troubles, to reduce unnecessary variability in manufactur-
ing process and product. Since no group has been assigned this im-
portant function, it has not been properly performed.

2. Are any unnecessary functions allocated?

The methods group in the engineering department is assigned the
responsibility of informing the production floor of production starting
dates (manufacturing order issuance). The methods group is given
this function presumably because of its responsibility for determining

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 63

the production method and building the tools, dies, jigs, and fixtures to
conform with the prescribed method. These must obviously be com-
pleted before production can start. However, since the production-
planning group establishes schedules for accomplishing this methods
work as well as the starting dates and rates of production, it has been
unnecessary and undesirable to have the methods group issue another
schedule, even if it did not sometimes conflict with the production-
planning schedule.

3. Are these junctions allocated so as to provide harmonious group-
ings?

Combining time study and inspection does not constitute a harmo-
nious grouping of functions. Time study is primarily a fact-finding and
planning function. Inspection is primarily a direct labor determination
of physical conformance of parts and products. They have not made a
good combination in this company.

4. Are similar activities grouped close together?

The inspection of incoming material is assigned to the purchasing
department. This was poor because the supervisors of purhasing de-
partments are usually quite ignorant of the details of inspection prac-
tices, policies, and procedures, such knowledge not being requisite for
proper performance of their procurement functions. In addition, some
expensive but not completely utilized equipment and specialists are
duplicated in the purchasing and inspection departments. It therefore
appears desirable to have incoming material inspection performed in
the inspection department where other similar inspection operations
are performed.

5. Are dependent junctions close together?

In the present organization, methods engineering is performed by
the engineering department and time study engineering in the inspec-
tion department. This arrangement has not worked too well because of
the close interconnection and dependency of methods and time study
work.

6. Are control junctions independent of the activities controlled?
Having the timekeepers report to the floor foremen, as in the present

organization, is not advisable. The timekeeper should be as inde-
pendent of shop influence as possible because of the important labor-
payment control function he performs. In addition to placing the time-
keepers so that they report to an independent central authority, their
floor assignments in the plant should be rotated.

64 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

7. Are there overlapping responsibilities?

Both the production-planning department and the purchasing de-
partment have the responsibility for expediting the delivery of overdue
materials. This is not only wasteful, but also hinders the proper per-
formance of this function.

8. Are activities which are performed in sequence placed close to-
gether?

The determination of material and parts requirements and the in-
ventory ordering functions are performed by the production-planning
department. The next step in the production cycle, placing the pur-
chase order on the best vendor, is performed by the centralized pur-
chasing department which is completely independent and organiza-
tionally and physically distant from the planning department. This has
made close coordination difficult and has increased the manufacturing
time cycle.

9. Has the best compromise between centralization and decentraliza-
tion been reached?

The high degree of centralization in this large enterprise has required
a large amount of paperwork to coordinate the giant-sized service
activities. This has resulted in sluggish operations with long time cycles,
and has materially reduced the incentive and initiative of tEe depart-
mental managers. Many of the enterprise's functions can be better
performed if they are divided by product line. The service groups are
then smaller and easier to manage. The product line managers, con-
trolling most or all of the functions which will determine their success
or failure, have a greater incentive.

10. Does anyone report to two bosses?

The plant accountant reports both to the production manager and
to the accounts and finance department. At times this has caused some
confusion and friction and should be remedied.

11. Have personality biases affected the organization?

Yes. Because of personality biases, the personnel function has been
placed in the sales division. The personnel policies of the company
have, as a result, been slanted more towards the merchandising than
the engineering and manufacturing operations.

12. Are the "span of control" and "chain of command 9 as small as pos-
sible?

No. The ten persons reporting to the general manager is excessive.

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 65

The excessive "span of control" has made it impossible for the general
manager to devote the proper amount of time to planning.

13. Does the organizational arrangement promote flexibility?

The high degree of centralization imposes handicaps on the ability
of the enterprise to meet changing conditions and requirements.

Based on a more detailed analysis of the type just presented, the sys-
tems man constructed a revised Organization Allocations Chart, as
shown in Figure 16. In this new chart, some of the objectionable
features of the present allocations of functions have been corrected.
The new organizational structure and functional allocations should
represent the closest possible observance in this enterprise of the prin-
ciples of good systems. However, the new chart represents a com-
promise, as all such charts must. The compromise is based on the
individual characteristics of the enterprise, the industry, the labor
market, and the geographic locale. These determine the relative im-
portance of the various aspects of the good systems precepts.

ORGANIZATIONAL FLOW CHART

When the principal purpose of a systems survey is to study the rela-
tionships of the various phases of interdependent functions in the
enterprise, the Organizational Flow Chart is an effective way to pre-
sent the data for analysis and for quick comprehension of the over-all
picture. The major operating steps in the performance of the function
and the major organizational units performing them are graphically
presented for ready analysis.

The Organizational Flow Chart consists essentially of a chart divided
into vertical columns or horizontal rows labeled for each organizational
unit performing one or more elements in the procedure. In its simplest
form, the activities performed by each unit are indicated in each of
these columns or rows by circles or squares, or elongated circles or
rectangles, and these are connected in sequence by directional lines to
indicate the flow of information. In general, no attempt is made in the
broad charting of the procedure to identify all the details and paper-
work or the distribution of all copies of the paperwork. Only principal
activities are indicated.

To illustrate the construction of the Organizational Flow Chart, the
system of designing and ordering packing and packaging materials in
the plant of a hypothetical farm-machinery manufacturer is described
below. The term "packing materials" refers to the materials required

General Manager

I Accounts and Finance I

General accounting
Accounting statements
Internal auditing
Heal estate
Accounts receivable
Non-factory payroll
Non-factory accounts

payable
Insurance

Fixed assets accounting
Tax compliance
Credit and collection
Budgetary control

Personnel | Manufacturing j I

Sales

Employment
Labor relations
Wage and salary

administration
Safety

Training and education
Employee morale
Medical service
Personnel insurance

and compensation
Employee sales

Sales planning and

forecasting
Market development

and policies
Product development
Advertising
Selling
Market analysis and

consumer research
Customer relations
Product service
Replacement parts
Warehousing - finished

goods
Traffic
Printing

I Plant Services I

General plant maintenance
Machinery maintenance

(repairs and preventive
Planning and scheduling
Plant and facilities

(design and estimating)
Power plant operation
Mail, telephone, guard,

elevator and receptionist

services
Cleaning

I Purchasing I

Purchasing policies
Development and approval

of supply sources
purchase contracts

Product Line A

J L

Product Line B

Same as Product Lino B

[ Methods Engineering 1 1 Accounting and Cost Control I |

Production

Manufacturing methods -

prod'n, test, & packing
Packaging operations
Machine development
Trouble shooting
Time study

Production models & samples
Tool design & estimating
Tool construction
Material & labor cost standards
"Make or Buy" policies
Plant layout

Factory accounts payable
Factory payroll
Coot accounting
Factory expense budget
Production cost estimating
Timekeeping

Fabrication

Sub-assembly

Assembly

Finishing

Final Packing

Shipping

Figure 16. Proposed Functions Allocations Chart. Comparison with the exist
tions proposed in the reorganization plan.

66

Systems

Engineering

Systems and organization

control

Systems auditing
Equipment control
Office layout

Public Relations and Services

Public relations
Legal

I Planning

Planning & scheduling
Cost estimating
Bill of material

I Services I

Drafting
Blueprinting
Library
Engineering modeli

| Product Line C | ] Product Line D | [ Quality Control |

Quality standard
Reject control

Same aa Product Line B

Same as Product Line B

Inspection

Production Planning
and Procurement

Inspection
Test

Incoming materials
inspection

Order acceptance

Pre-production scheduling

Bill of material preparation

Factory scheduling

Plant and machine loading

Detail material ordering

Manufacturing order issuance

Receiving

Inventory control

Placing purchase orders

Expediting - stock, tool,

& product
Stores

Tool storing
Dispatching
Material moving
Shipping control
Production Performance reports
Scrap or surplus material

disposition
Engineering change execution

ing situation shown in Figure 15 points up the basic redistribution of func-

67

68 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

to pack the farm equipment for shipment. The term "packaging mate-
rial" is used to designate the materials for packaging spare parts and
service parts.

A. The design-engineering department

1. Designs the farm equipment

2. Builds models

3. Issues blueprints

4. Prepares Bills of Material (BM) and releases to the planning
department

5. Informs the shipping department that the engineering model
is completed.

B. The planning department issues a Works Order for the equipment,
sending a copy to the shipping department. The shipping depart-
ment is thus informed of the equipment that will be built in the
plant and is put on notice to look for a model from which to design
the packing that will be required for shipping the equipment.

C. Upon learning that the engineering model of a new equipment has
been completed and approved, the shipping department designs
the packing materials required to pack it in accordance with sales
department and/or customer specifications. The shipping depart-
ment then prepares a packing Bill of Material for each Unit to be
packed. This Bill of Material is forwarded to the inventory-control
department.

D. The inventory-control department multiplies each item on the pack-
ing Bill of Material by the number of units to be shipped to obtain
the quantities required.

E. The inventory-control department obtains delivery requirement
information from the Production and Shipping Schedule, issued by
the planning department.

F. The inventory-control department then prepares Purchase Requisi-
tions for all required packing materials which are not available in
stores and sends the Purchase Requisitions to the planning depart-
ment.

G. The planning department approves the requisitions and forwards
them to the purchasing department.

H. The purchasing department purchases the material.

I. The planning department prepares accumulation sheet lists in
numerical sequence of all parts on the Spare Parts Kits list. A copy
of this list is sent to the methods-engineering department,

J. The methods-engineering department checks the items on the ac-

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 69

cumulation sheet lists against the file of existing packaging proc-
esses. Where a process exists for packaging the part in accordance
with customer requirements, no further action is taken.

K. The methods-engineering department prepares a list of those parts
for which no process exists and sends it to the stores department.

L. The stores department accumulates one set of parts in accordance
with the list of paragraph K above and sends the parts to the
methods-engineering department.

All requested parts which are not available in the stores depart-
ment are put on shortage. Cards are placed in the shortage files and
a list of these short items is sent to the methods-engineering depart-
ment.

M. Upon receipt of the parts from the stores department, in accordance
with paragraph L above, the methods-engineering department spec-
ifies by Packaging Code the packing materials and process to con-
form with customer requirements. A Packaging Process with these
specifications is issued and distributed.

N. Packaging materials are ordered on a past usage basis by the inven-
tory-control department Purchase Requisitions are forwarded to
the purchasing department for placing the orders with the vendors.

O. The purchasing-department buyer purchases the required packag-
ing material.

P. When the shortage parts of paragraph L above are received by the
stores department, they are forwarded to the methods-engineering
department.

Q. The methods-engineering department then processes these parts for
spare-parts packaging.

R. When standard metal spare-parts boxes are required, the design-
engineering department specifies the requirement in the "Descrip-
tion" column of the preliminary spare-parts list. The quantity, size,
and part number of the box are omitted.

S. At least one month prior to the scheduled shipping date of the
equipment, the methods-engineering department informs the de-
sign-engineering department of the quantity, size, and part number
of the required spare-parts boxes.

T. Upon receipt of the information of paragraph S above from the
methods-engineering department, the design-engineering depart-
ment issues an engineering notice ordering the required spare-parts
boxes.

U. Upon receipt of the engineering notice of paragraph T above, the
planning department issues Order Cards to order:

70 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

1. The parts, materials, and labor required to manufacture the
spare-parts boxes, or

2. The spare-parts boxes from vendors.

The Order Cards are handled and distributed in the standard man-
ner.

V. Upon receipt of the Order Cards of paragraph U above, the inven-
tory-control department prepares Purchase Requisitions for the
required material, parts, or spare-parts boxes.

W. The purchasing department buys the required materials.

This procedure has been plotted in an Organizational Flow Chart,
shown in Figure 17. The letters on top of each of the circles correspond
with the descriptive paragraphs of the above text.

KEY QUESTIONS FOR ORGANIZATIONAL FLOW CHART

This charted procedure is analyzed by the systems analyst. He asks
himself each of the following questions:

1. Could functional allocations be rearranged to reduce communica-
tion and paperwork?

2. Is there back-tracking because some groups do not have all the
necessary authorities for carrying out their functions? Or because
these authorities are not placed as close as possible to the persons
who take the action?

3. Do all departments use all the information provided by the pro-
cedure?

4. Is the system automatic? Is expediting required?

and analyzes each action or group of actions

5. Why must it be done?

6. Where should it be done for best economy?

7. When should it be done?

8. How should it be done?

ANALYSIS OF CHARTED SYSTEMS FLOW

Using these questions, the charted procedure for designing and
ordering packing and packaging material is analyzed, The answers to
the questions are summarized below:

1. Could communication lines be reduced by changing responsibility
assignments?

Organizational Flow Chart
Present system o f designing & ordering packing & packaging material

DESIGN
ENG G
DEPT

METHODS
ENG*G
DEPT.

SHIPPING
DEPT

PLANNING
DEPT

STORES
DEPT

INVENTOR^
CONTROL
DEPT

PURCHAS-
ING
DEPT

c r

D

H

Designs ^\
Equipment
Builds
Models

Issues
Blueprints
Issues H

Issues "|
works
1 order for
each new
Shop Order]

'Designs ~\
Packing

B

(Extends

B M

jax

Prepares
Bin ofMat'lj

E

\^ments J

Informs
shipping
that model
is complex
(not always
\done)

F V

hcorporates\
Delivery

issues

merits in
Production
Schedule J

Requisitions

A
R

}

G

Approves *

\Purchases\

Requisitions^

L

N

\Mat6rial J

I

Checks "\
Existing

Issues
Sptre

(Accumulated
Re gd Ports
which ore
Available
Places

Processes '
Issues
List of ,

~ Parts Kits
Accumulat-
ion Sheets^

Mao

\pn ShortogQ

)

Determines

Orders

(Purchoses\

Packaging
Q Issues

P

Packaging *
Material on
Usuage
\Basis

^Material J

Receives

W

U

Disburses
Shortage
\J>art$ J

S

Specifies"
MetalSpare
Ports Boxes
When Req'd

Omits Spe-
\cification$^

V

Determine*
Metof Sport
~ Parts Bo Mi
Specifica-
tions

T

J

Issues
Engineer- ~
ing Notice
Ordering
Spare

Issues ^
Order
Cards to

Issues

- Purchases
Material

Parts
Boxes *

" Order
Materials

Requisition

Note The identifying letter above each activity refers to the paragraph in which the
activity is described.

Figure 17. Organizational Flow Chart traces the flow of a rather
complicated procedure and facilitates analysis of the system for pos-
sible improvements.

71

72 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Yes. One example: If the design-engineering department performed
the design of the packing containers as well as of the equipment, the
shipping department would not be involved in the ordering cycle at all.

2. Does back-tracking give evidence of lack of required authorities,
or that authorities are placed too high in the organization?

Yes. The Organizational Flow Chart shows back-tracking where the
inventory-control department must obtain the approval of the planning
department on the Purchase Requisitions which they prepare. For the
proper performance of its assigned responsibilities, the inventory-con-
trol department should have the authority to place orders for materials.
Requiring the written approval of the planning department on each
requisition is wasteful of time and money and interferes with effective
performance.

There is no evidence that authorities are not placed close enough to
the personnel who take the action. If the break-down of the organiza-
tional units on the chart were finer, it might reveal back-tracking
amongst the various groups in the departments because of required
authorizations.

3. Do all departments use the information they receive?
Yes.

4. Does the system work automatically?

No. Expediting is required to insure the accumulation of parts in
the stores department to enable the methods-engineering department
to specify the packaging materials and the packaging processes. Also,
since the ordering of packing and packaging materials does not follow
the normal routines for production materials in the plant, more than
the usual amount of personal follow-up is required.

5. Why must each step be done?

Ordering of packaging material on the basis of guesswork and past
usage only, as specified in paragraph N, must be done because the
inventory-control department is not informed of packaging require-
ments. If packaging requirement information were transmitted to the
inventory-control department in the same manner as other material
requirements, this special step of ordering on the basis of past usage
could be eliminated.

6. Where should each step be done?

Both packing and packaging design should be performed in the
design-engineering department of the plant. This will simplify pro-

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 73

cedures, shorten the ordering time cycles, and centralize responsibility
for completely designing and specifying all the materials and parts
required for an equipment, including shipping containers.

7. When should each step be done?

The design of the packing and packaging should be done at the same
time or immediately after the design of the equipment and parts. This
should eliminate delays which presently develop because of shortages
of packing or packaging materials which have been ordered late.

8. How should each step be done?

The design of the packing containers should be done from the
engineering models by the design-engineering department in the same
manner as it is presently done by the shipping department. The design
of the packaging containers should also be done from the engineering
models and parts rather than from the production units, which are not
available until a much later time.

Using an analysis similar to the one just presented, but going into
more detail, a revised procedure is charted in Figure 18. This new pro-
cedure involves a shifting of responsibilities and is summarized below:

Organizational Flow Chart
Proposed system of designing 8 ordering pocking 8 packaging material

DESIGN
ENGG
DEPT

PLANNING
DEPT.

INVENTORY
CONTROL
DEPT

PURCHASING
DEPT

METHODS
ENG'G
DEPT.

A

E

'Designs
Eouipment

Issues

* PfirUfifiinft

Builds
Models
Issues H
Blueprints

Issues B.M.
Including
Pocking &
Packaging
Requirements

B

C

D

[Process )

Prepares
" Bill of
Material,
Books, incf.
Packing
[Requirements

J Prepares ~\
" Purchase r
[Requisitions j

(Purchases
{Material }

Note- The identifying letter above each activity refers to the paragraph in which
the activity is described.

Figure 18. Proposed Organizational Flow Chart. Comparison with Figure 17
provides a very succinct and striking picture of the simpler flow provided
by the proposed changes.

74 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

A. The design-engineering department

1. Designs the equipment

2. Builds models

3. Designs packing and packaging

4. Issues blueprints ( The prints for the spare-part kits will have the
packaging of each part in the kit specified by Packaging Code. )

5. Prepares Bills of Material, including packing and packaging
requirements, and sends to the planning department.

B. The planning department prepares and distributes the regular Bill
of Material books for ordering material and parts, including packing
and packaging requirements.

C. Upon receipt of the information of paragraph B above, the inven-
tory-control department prepares Purchase Requisitions for the
required items.

D. The purchasing department buys the required material.

E. Upon receipt of spare-parts prints (see paragraph A, 4 above) the
methods-engineering department checks the items listed against the
file of existing Packaging Processes. Where a process for packaging
the part in accordance with the designated Packaging Code does
not exist, a Packaging Process with these specifications is issued.

ORGANIZATION FLOW CHART VARIATIONS

A variation of the Organization Flow Chart using pictorial symbols
is shown at page 260. Such a chart is especially useful for training and
systems installation purposes.

Another variation of the Organizational Process Flow Chart, known
as a Correlation Chart, is shown in Figure 19. This type of chart may
sometimes be useful for showing how various units correlate their
activities in accomplishing a given function.

ACTIVITY ANALYSIS CHART

When the analyst desires to study the entire range of the activities of
an organizational group, the Activity Analysis Chart may be a very
useful tool. This chart provides a means of obtaining a broad view of
all the activities of the personnel in the group: what is done; where it
is done; to some extent, how it is done; who does it; and approximately
how much time is spent doing it. This information is arranged in the
Activity Analysis Chart so as to promote logical analysis which will
disclose the broad possibilities for improvements. Although there is

LJ

Z

o

iff

a

ACTIVITY

SECTION
SUPERVISOR

INVENTORY

ANALYST

INVENTORY
ANALYST

HAN
HftS.

A. Applty

MH

8. Brown

MH

C. Court

MH

INVENTORY
CONTROL
RECORD AND
REPORT

132

Sample check
postings

Prepare
inventory
report

15
15

REQUISITION
MATERIALS

66

Review and
sign

7

Determine and
separate cards
requiring orders
Make pencil copy
of requisitions
Maintain regu/s
central register

IO

20
2

EXPEDITE
SHORT
ITEMS

22

Prepare and
dictate
expediting
correspondence

1

SURPLUS
UTILIZATION

27

Determine 6
separate cards
indicating
surplus

material

15

VENDOR
RECORD

14

INQUIRIES

15

Interview
callers

Prepare 8
dictate replies
to inquiries

2
1

Interview
callers

Prepare 8
dictates replies
to inquiries

3
1

Interview
callers

Prepare 8
dictate replies
to inquiries

2

1

ADMINISTRATION

32

Conferences
Budget matters
Personnel
matters
Keep
attendance
records

4

' 5

2

Conferences
Personnel
matters-
supervision f
grievances,
discipline f etc.

1
2

Conferences
Personnel
matters -
$upervi$ion t
gr/eronces,
discipline f etc.

1
4

MISCELLANEOUS

13

Read company
policy reports t
correspondence^

3

Read company
policy reports,
correspondence t
etc.

/

Read company
policy reports,
correspondence,
etc.

I

$$

4(?

40

40

Fig. 20. Activity Analysis Chartsummarizes the allocations of work to

76

CLERK

CLERK

CLERK

SECRETARY

TYPIST-CLERK

D. Dortmor

HH

Ear/9

MH

F. Farrow

MH

G. Gordon

UH

H. Hunt

Uh

Post orders

File posted
paperwork

20
5

Post with-
drawals

37

Post require-
ments

Post deliver"
*es

30
10

Type Q proof
purchase
requisitions

26

Prepare and
dictate
expediting

correspond-
ence

J

Take dictation
Q typing of
expediting cor-
respondence.
Wake expedit-
ing phone calls

9
9

Investigate to
determine
uses and /or
disposition
of surplus

12

}

Post to vendor
record from
purchase
order

14

Take dictation
Q typing of
replies to
inquiries

5

Handle
administra-
tive corres-
pondence

IB

Emergency
messenger
service

3

Open and
distribute
incomingmol

Misc. typing

J
2

4l

40

4$

44

4Q

the various persons in the section in a convenient form for analysis.

77

78 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

nothing complicated about an Activity Analysis Chart, it can provide
the basis for a revealing analysis of how effectively an organizational
group is performing its assigned responsibilities.

The Activity Analysis Chart consists essentially of summary state-
ments of the major activities of the organizational groups, together with
a break-down indicating the contribution of each person to each
activity.

The first step in preparing the chart is to obtain information on the
duties of each person in the group and the average man-hours per
week devoted to each duty. This is conveniently done by means of a
questionnaire, such as was discussed in Chapter IV. At the same time,
the analyst should start determining the major activities of the group.
All information sources should be utilized in attempting to make the
list complete and accurate. The supervisor of the group can prepare
the original list. Direct observation may reveal activities which were
forgotten by the supervisor. An organizational manual, if available,
may disclose some omitted activities to be added to the list. When the
duties questionnaires have been received, additional forgotten activities
may be brought to light.

The construction of the Activity Analysis Chart is illustrated in
Figure 20 by the sample analysis of an inventory-control group. The
principal categories of activities are indicated in the first left-hand
column in roughly descending order of importance. Each column to the
right is then labeled with the name of the persons in the group. Each
duty of every person is entered in the row of the activity to which it
contributes. Alongside each duty are entered the average weekly man-
hours spent on the duty. The hours spent by each person on each duty
contributing to the activity are then added horizontally to get the total
man-hours devoted by the group to that activity.

Although it is frequently undesirable to place salaries on the Activity
Analysis Chart, it is usually very helpful for the analyst to know all the
salaries, or at least the approximate range of the salary of each person.
Otherwise, it may be more difficult properly to evaluate the utilization
of skills under the existing and/or proposed procedures.

Key questions for the Activity Analysis Chart

The analysis of the Activity Analysis Chart can be divided into three
phases:

I. Analysis of the activities as entitiesquestioning each and
all of the activities listed in the left-hand column of the
chart.

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 79

II. Analysis of the duties for the performance of each activ-
ity: how is the activity broken down into elements or
duties and how are these duties distributed? The group
of duties in each horizontal activity row is considered
separately.

III. Analysis of the duties of each individual: what is the job
assignment of each person? The group of duties listed in
each individual's column are studied separately.

Analysis of the activities as entities

1. What function or functions is the unit responsible for?

2. Are all the activities necessary for the successful accomplishment
of function or functions?

3. Are there any activities or functions which are unrelated to the
primary responsibility and which should be performed elsewhere?
Can any of the activities be performed more efficiently elsewhere?

4. Are any additional activities required for the successful accomplish-
ment of assigned responsibilities?

5. Which activities are of major importance? Do these activities re-
ceive the major proportion of the man-hours of the group? Which
activities are of lesser relative importance? Is too large a proportion
of the total time spent on them?

6. Are any of the activities duplicated elsewhere in the enterprise? Is
it advisable to eliminate the duplication?

Analysis of the duties for performance of each
activity

1. What duties are necessary to accomplish the activity? Are all of
these assigned to some person?

2. Are any unnecessary duties or duplication of duties assigned?

3. Do the most important duties connected with the activity take the
most time?

4. If all of the duties connected with the activity are assigned to one
or a few persons, would it be preferable to spread the duties
amongst more persons? Should they be assigned to each person on
a sequential (assembly-line) basis or should each person be as-
signed the same parallel duties? If the duties connected with the
activity are spread over a large number of people, would it be
preferable to concentrate responsibility in one or two persons?

5. Is the long-run amount saved by checking duties greater than their
cost?

80 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

6. Do the highly skilled employees perfrom the high-skill duties con-
nected with each activity?

Analysis of the duties of each individual

1. Does the group of duties assigned the individual constitute a
logical job grouping? Are there too many miscellaneous, unrelated
duties which reduce worker efficiency?

2. Are the special skills of the employee used to the fullest extent?
During what proportion of the total work time does the person use
his special skills?

3. Is the work load distributed evenly? Do some employees have too
large a proportion of the important and the deadline work which
imposes strain?

SAMPLE ANALYSIS OF THE INVENTORY-CONTROL
ACTIVITIES AS ENTITIES

1. What functions is the unit responsible for?

The inventory-control section is responsible for maintaining the
proper levels of inventories in stores and for insuring that required
material is available for delivery to the fabrication and assembly floors
in accordance with schedule.

2. Are all activities necessary to accomplish this?

The vendor-record activity of the inventory-control section is not
required to accomplish proper inventory control. It is valuable to have
a record on one card of all the orders that have been placed on each
vendor for the past ten years to answer inquiries and perhaps aid a
little in expediting. However, it does not promote the objectives of the
section in a substantial enough way to justify its cost.

3. Could any activities be performed better elsewhere?

The investigation of possible uses of surplus materials could better
be performed in the design- and methods-engineering groups. The
question of substitution of materials and parts is essentially an engineer-
ing and methods problem requiring a knowledge of the technical con-
siderations as well as of future plans. When reviewing the inventory-
control cards to separate those items requiring orders, the inventory
clerks can prepare surplus notice forms which can then be circulated
to the various groups concerned in making decisions on possible future
utilization. (The amount of time for this duty is so small that it is not
listed on the proposed Activity Analysis Chart prepared later.)

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 81

4. Are any additional activities necessary?

When parts are slightly damaged, or rejected for remediable defects,
they are eligible for rework to make them usable if future require-
ments warrant. The inventory-control section maintains the record of
requirements. The record of reject parts which might be reworked is
kept in the storerooms in a haphazard manner. After checking with
the inventory-control section, orders for rework are prepared by the
storeroom, with a copy going to the inventory-control section for their
records. Setting up a reject rework activity in the inventory-control
section will centralize responsibility for this activity at the source of the
knowledge of future requirements.

5. Do major activities receive the major proportion of the man-hours?
The inventory-control record, requisitioning of materials, and ex-
pediting of short items constitute the activities of major importance.
They use up only 69 percent of the total man-hours of the section. Too
large a proportion of the time of the section is spent on relatively unim-
portant activities such as interviewing callers, preparing inventory
reports, investigating uses for surplus, and other miscellaneous activi-
ties. The major activities of requisitioning and expediting have suffered
as a result.

6. Should any activities which are duplicated elsewhere be eliminated?
The information in the inventory reports prepared by the inventory-
control section is also contained in satisfactory form in the more de-
tailed reports issued by the plant-accounting department. Almost all
the recipients of the Inventory-Control Report also receive the Plant-
Accounting Report. The Inventory-Control Report should be elim-
inated.

SAMPLE ANALYSIS OF THE DUTIES FOR THE
PERFORMANCE OF EACH ACTIVITY

1. Are all required duties assigned?

Without a record of the floor shortages (materials which have dis-
appeared and cannot be accounted for) the inventory-control record is
incomplete. Floor shortages must be replaced. Unless they are entered
as requirements, the total requirements will be understated. Posting of
floor shortages is thus a necessary duty of the inventory-control record
activity which has not been assigned and performed.

2. Are any duties duplicated?

The personnel matters duty of the administration activity general

82 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

supervision, grievances, discipline, etc. are handled by both the sec-
tion supervisor and the two inventory analysts. This is not the kind of
duty that can be shared very well. It is preferable from the point of
view of both economy and effectiveness not to have this duty repeated
in three places.

3. Do the most important duties consume the most time?

The review-and-sign duty of the material-requisitioning activity
appears to consume too small an amount of time in proportion to its
importance in comparison with the time spent in the preparation of the
requisitions. This is the most important control which the section super-
visor directly exercises on the inventory-control function.

4. Would it be preferable to redistribute the duties amongst more or
fewer persons or in a different pattern?

The separating of cards for materials requiring new purchase orders,
the preparation of the pencil copy of requisitions, and the maintenance
of the requisition control register are all performed by the inventory
analyst. On the average, these duties take up practically all of his time.
When there is a sudden rush and high volume of work in the requisi-
tioning activity for a short period, it is impossible for the inventory
analyst to adjust his duties to meet this short-range peak requirement.
If some of these duties could be placed properly elsewhere, the inven-
tory analyst could take on duties related to other activities. Then, on
those occasions when the material-requisitioning activity required more
than the average amount of time, he could take the time from a duty
connected with a less immediately urgent activity.

The present assignment of duties to the clerks performing the inven-
tory-control record activity concentrates in each clerk one or two of the
sequences of events which occur on each record card requirements,
orders, receipts-, disbursements. This possesses the advantage that each
clerk becomes an expert in posting the events assigned to him. This
advantage is not of great significance, however, because the clerks can
become experts in the posting of all four events with little extra train-
ing and exertion. It is more advantageous to assign the same duties in
parallel to all three clerks working on this activity, giving each one a
separate group of storerooms and items. Periodic variations in the
activity of the four events do not cause as great a burden on one
person. Job monotony is reduced by some variations in the type of
posting.

The interviewing of callers, answering of phone queries, and dictat-
ing of replies to inquiries can be handled more effectively if concen-

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 83

trated in one person. It is difficult to find a logical basis for dividing
the responsibility, thus causing confusion in answering inquiries. In
addition, these inquiry duties are disrupting to the normal routine of
the day's operations and may hold up more essential duties. The super-
visor is best able to control them and to see that they do not interfere
too greatly with more essential activities. The handling of all inquiries
also will aid the supervisor to keep tabs on all the activities of his
section.

5. Do the checking duties cost more than they are worth?

The expenditure of 15 hours a week of the inventory analyst's time
to check the postings of the clerks is not worthwhile. The number of
discovered errors which would not have been revealed when the cards
were reviewed and separated for ordering purposes is exceedingly
small. In addition, the checking duty tends to promote a feeling of lax-
ness on the part of the clerks an attitude of "mistakes are all right
because the checker will find them."

6. Does the higher skilled person do the higher skilled part of the
activity?

In the surplus-utilization activity the investigating and determination
of disposition duty, which requires a high degree of judgment and skill,
is performed by the clerk. The section supervisor, however, determines
which items are to be considered surplus by analyzing the inventory-
control record cards. This duty does not require very high skill and can
be made quite routine by establishing standards as to when material
is to be considered surplus.

SAMPLE ANALYSIS OF THE DUTIES OF EACH INDIVIDUAL

1. Does the job grouping of each person constitute a logical entity?
The duties of Donald Doremor, clerk, do not constitute a logical

job grouping. His duties are pretty much a mixture of relatively unre-
lated tasks. This is poor for his sense of accomplishment, morale, and
effectiveness.

2. Are each persons special skills used to the fullest?

The section supervisor spends almost half his time determining sur-
plus material from inventory cards and keeping attendance records.
These could be handled very well or better by a clerk.

Inventory analyst Bernard Brown spends more than one quarter of
his time separating cards requiring orders and maintaining a requisi-

ACTIVITY

SECTION
SUPERVISOR

INVENTORY
ANALYST

CLERK

MAN-
HRS,

A. Appley

M.H.

B. Brown

MM

D. Ooremor

MH.

INVENTORY
CONTROL
RECORD

114

Post deliveries Q
withdrawals
Post requirements
Post orders.
Post floor
rejects, shortages

15

10
8
4

REQUISITION
MATERIALS

75

Review & sign

12

Prepare pencil
copy of
requisitions

26

Separate cards
requiring orders

3

EXPEDITE
SHORT
ITEMS

33

Hand/e very
critical cases

6

Prepare expedit-
ing correspond-
ence

Moke expediting
phone caffs

6
3

REJECT
REWORK

8

Review & sign

f

Prepare pencil
of rework orders

J

INQUIRIES

13

Interview callers
Prepare and
dictate replies
to inquiries

6
2

ADMINISTRA-
TION

25

Conferences

Budgetary
matters

Personnel matters
supervision, griev-
ances, discipline

4

1

5

Conferences

/

MISCELLAN-
EOUS

!2

Read company
policy reports,
correspondence
Review 3 improve
section operat-
ing procedures

2
1

Read company
policy reports,
correspondence t
etc.

/

Z8C

4O

4O

4C

Figure 21. Activity Analysis Chart shows reallocation of activities

84

CLERK

CLERK

SECRETARY

TYPIST- CLERK

E. Carle

M.H.

F. Farrow

M.H.

ff. Gordon

M.H.

H. Hunt

U.H.

Post deliveries 3
withdrawals
Post requirements
Post orders
Post floor
rejects, shortage*

17

10
6
4

Post deliveries Q
withdrawals
Post requirements
Post orders
Post floor
rejects, shortages

15

10
6
4

File posted
paperwork

5

Separate cards
requiring orders

J

Separate cards
requiring orders

3

Type & proof
purchase
requisitions
Maintain requisi-
tions, control
register

26
2

Take dictation
S typing of
expediting
correspondence

ie

Maintain rework
stock record

2

Type & proof
rework orders

Maintain rework
order control
register

1*
*

Take dictation Q
typing of replies
to inquiries

5

Handle adminis-
trative corres -
pondence

Keep attendance
records

12
2

Open Q distri-
bute incoming
mail

J

Emergency
messenger
service
Miscellaneous
typing

5
2

40

4O

4O

4O

of the personnel shown in Figure 20, made after careful analysis.

85

86

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

tion control register. Both of these duties could be performed by a
clerk.

3. Is the work load roughly balanced?

Inventory analyst Charles Court appears to have few duties which
might impose great strain.

Based on a more detailed consideration of the type of analysis just
presented, a new Activity Analysis Chart, shown in Figure 21, was con-
structed to show how the inventory-control section's activities could be
organized more effectively.

The Activity Analysis Chart provides a technique for making an
analysis of the broader aspects of the activities of an organizational
group as well as some of the more detailed considerations. It is im-
portant to remember, however, that it does not constitute the sole or
most effective tool for analyzing all the detailed systems problems of an
organizational unit. For example, it does not necessarily describe or
provide for the analysis of how the activities are performed. Many
other useful analytic tools are presented in this and other chapters to
cover these additional needs.

DEPARTMENT ANALYSIS CHART

A variation of the Activity Analysis Chart is the Department Activity
Analysis Chart, such as shown in Figure 22, essentially an Activity

DEPARTMENT ANALYSIS CHART
Deportment XYZ

Activity

Section /

Sect/on 2

Seel ion 3

Section 4

Sect/on 5

SecttonG

man
hrs

/nan
hrs

man
hrs

{nan
hrs

man
hrs

man
hrs

man
hrs

Activity A

Activity B

ActivityC

Activity D

Activity E

Figure 22. Department Analysis Chart shows sections, departments, divi-
sions, etc.: similar to the activity analysis chart.

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 87

Analysis Chart which considers the activities of the groups making up
an organizational unit rather than the individuals in an organizational
unit. This chart can be considered a less detailed consolidation of the
Activity Analysis Charts for each section. Department Activity Analysis
Charts can be similarly consolidated to produce a Department Activity
Analysis Chart for the next higher organizational unit.

The method of analysis of the Department Analysis Chart is directly
analogous to the analysis of the Activity Analysis Chart. Similar ques-
tions are asked to discover sources of improvement.

PROCESS CHART

To study the details of a relatively simple activity or a small portion
of an activity which is performed within one organizational unit, the
Process Chart is a very convenient and useful device. It records the
detailed systems data in readily understandable manner so that they
may be analyzed to eliminate unnecessary steps or to change the order
in which they are done to reduce effort, fatigue, and time.

The Process Chart, applied to systems work, is essentially a detailed,
chronological record of the successive steps in a procedure. In its
simplest form, the Process Chart consists of a two-column chart, one
column of description and a second column to the left of the first,
symbolizing the described step for ease of understanding the sequence
of steps. The simplest charts use just four symbols:

O Operation

o Transportation

Q Inspection

V Storage

An operation is performed when something is added, subtracted,
changed, or created. An action is not classified as an operation if it
involves solely the movement of an object from one place to another
or if only a check or verification but no change in the record or object
or situation is made.

A transportation occurs whenever an object, form, letter, or idea is
moved from one place to another.

An inspection occurs whenever an object, form, letter, or idea is
checked or verified, but without making any change.

A storage results whenever an object, form, letter, or idea is not being
operated upon, transported, or inspected. Storages fall into two types
of situations:

88

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

1. Storages which delay the next step in the processholding up the
next operation, transportation, or inspection.

2. Storages which involve protection of the object until the operation,
transportation, or inspection is ready to be performed.

It is not always possible clearly to distinguish between these two types
of storages.

For ease in drawing the process chart symbols, a celluloid ruler with
symbol cut-outs, such as is shown in Figure 23, may be used.

Courtesy C-Thru Ruler Company

Figure 23. Metric rule and stencil cut-out template for drawing process
chart symbols.

CONSTRUCTING THE PROCESS CHART

The first step in constructing a process chart is to define carefully the
activity being charted. Where does it begin and where does it end?
After deciding on and defining the scope of the activity, stay within it.
Cover no ground outside the defined scope.

Then, determine each step of the activity in sequence. Omit no
elements in the activity. If in doubt whether a minor step should be
included, include it. Describe each step so that it is clearly identifiable.

For the transportation steps, determine the distance in feet. For the
storage steps, determine the time so spent.

It is desired to analyze the issuance of a purchase order in a certain
company. Each step in this activity is therefore determined and
written down by the analyst:

Pencil order prepared by buyer

In outgoing box (20 min.)

To Register desk (950 ft.)

In incoming box (15 min.)

Checked for completeness and accuracy of extensions

P.O. number stamped on

In outgoing box (20 min.)

To typing pool control desk (175 ft.)

In incoming box of control desk (45 min.)

Checked for completeness and accuracy of extensions

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 89

P.O. number entered in control book and typist number placed on

pencil order

In outgoing box (20 rnin.)
To sorting table (50ft.)
Sorted numerically
To typist (25 ft.)
In incoming box (50 min.)
P.O. typed

Pencil and typed order in outgoing box (15 min.)
To proofreader's desk (150 ft.)
In incoming box (25 min.)
Proofread

In outgoing box (20 min.)
To control desk (130 ft.)
In incoming box (15 min.)

Checked for completeness and accuracy of extensions
Control book entry
In outgoing box (45 min.)
To purchasing agent (1,100 ft.)
In incoming box (100 min.)
Reviewed and signed
In outgoing box (20 min.)
To buyer (100 ft.)
In incoming box (45 min.)
Reviewed
In outgoing box (20 min.)

It is now desired to chart these steps in a simple manner which will
graphically promote clarity and ease of analysis. We also want to be
able to summarize the process: how many feet of transportation; how
many minutes of storage; how many operation, transportation, storage,
and inspection steps?

A convenient form for doing this is shown in Figure 24, in which this
process is charted. The separate columns for the time and distance in-
formation facilitate addition. The preprinted symbols on the chart,
which are connected by broken lines, save time in making the chart and
facilitate the counting of the number of steps in each category. The
total number of steps in each of the four categories should obviously
add up to the total number of steps in the process.

This procedure illustrates several characteristics of most processes
and procedures which it is helpful to keep in mind.

1.

J- JL 0.

Most operations or series of operations have a storage before and
after.

90 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

2. If each of the series of operations is not performed in immediate
succession on the same form, document, object, or machine, there
will usually be a storage step between the operations.

3. When operations are performed in succession by different persons,
there will usually be a transportation between the successive opera-
tions.

The process chart just prepared shows 6 operations, 8 transporta-
tions, 6 inspections, and 15 storages. The transportations total 2,680 feet
and the storages take up 475 minutes.

KEY QUESTIONS

How can this procedure be improved? To aid the analyst in making
a systematic analysis, he should ask himself the following questions:

1. Are the check and control steps worthwhile or would taking a
calculated risk be cheaper in the long run?

2. Is the system as automatic as possible?

3. Are there repeated steps or cycles of steps which suggest duplica-
tion or overlapping activities?

Examining each step and each group of steps individually and in
orderly succession to avoid a haphazard approach:

4. Why must the step or group of steps be done? Is it necessary?

5. What would happen if it were eliminated?

6. Who should do the step or group of steps? Could some other person
or unit do it easier less work, time, transportation, or storage?
Could it be assigned to a person of lower skill?

7. How should -it be done? Are the forms, equipment, and work
methods correct?

8. When should the step or group of steps be done? Should it be done
earlier or later in the process?

9. Where should it be done? Would a changed location reduce trans-
portation?

SAMPLE PROCESS CHART ANALYSIS

Let us apply these questions to the purchase order procedure just
charted. Numbering the answers the same as the questions just asked,
the systems analyst notes the following answers:

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 91

1. Are the checks or controls necessary?

On discussing the situation, the analyst and purchasing agent come
to the conclusion that although it was very nice to have a control record
of the orders going into and out of the purchase order typing pool, the
control was not really worth the expense. It could be dispensed with,
even though it might be missed on rare occasions.

2. Is the system automatic?

Yes. Judgment decisions are reduced to a minimum. The question
of the buyer's procedure in choosing a vendor and price is a separate
system.

3. Are there repeated steps or cycles of steps which suggest duplica-
tion or overlapping activities?

The registration of every purchase order at both the register and con-
trol desks suggests unnecessary duplication. Also, the checking of each
order for completeness and accuracy of extensions by four different
persons suggests unnecessary repetition of a required control activity.

4. Why must each step be done? Why must the orders be sorted into
numerical order before being typed?

The analyst and supervisor could not find out why the routine had
been started.

5. What would happen if the step were eliminated?
Nothing.

6. Who should check for completeness and for accuracy of extensions
on purchase orders?

It was decided that the proofreader was the logical person to check
on the completeness and accuracy of the order as prepared by the
buyer. The proofreader was considered the logical person even though
this activity is performed after the order has been typed because:

a. The buyer is expected to be accurate in most cases and very
few errors will be uncovered requiring retyping.

b. It saves the extra two transportations and two storage steps
which would be necessary if the independent check were made
prior to typing.

7. How should it be done?

By using continuous interleaved carbon fanfold purchase order forms
which have been prenumbered in series by the printer, the necessity for
registering and numbering each order is eliminated. Automatic regis-

PROCESS CHART

Procedure Chnrted; Purchase Order
Unit Q O Ms ton Pure, has ing D&p t.

Charted by-

Date

Otstonce Time

in feet

in /nin.

OTIS

Description of Step

D V

P<g/7c// orc/er prepared by

20

In

box.

ISO

o o<n v

To

IS

In /nc.ominq box.

O

Checkecj for corn pie fen ess & qccyrgcy vfe*1emiam

a v

P O. ni4/n6er stqmpe-d on

20

oufqojriq t>ox

O <D v

Jo

pool control de.*K

In incorninq

of con +r of

C/ie.c~K&cl For cornple-f-eneff 3

a v

PO *en+'d in control

-f~wirf #

on penal order

20

O o

In

bo*

s-o

To

cc

a v

To f~yp i or /"

O o

Jn /

v

P o.

IS*

Q>7

O o<D v

Penc.it <7/7</ /~y/>ec/ order //

t>o\

7~o

o

O o

In

box

/30

O o<D V

7~o co/?/

desk

/S"

/n incom/nc}

C/rzce<i for c

& qccyrqcy of exfens/onf

a v

Con

In ot//-<)o/n q

1/00

O <D V

To fxjrahqs i nq a q en /

/oo

o

Jn f

o

P(

ctnd s/gned

2.0

O

//?

tnq

/oo

o<p V

7~o

DCV

o

//? 0^7^90/^79

2. 80 47S"

Figure 24. Process Chartgives a step-by-step presentation of the proce-
dure for preparing purchase orders.

PROCESS CHART

Procedure Charted-

Unit B _
D Prtstnt
Kl Proposed

c. h cfse.

Charted

Date -

Ofstonce
in feet

Time
in in in.

OTIS

Description of Step

o-^ a v

f^enci/ o refer pr~c/}<lrec( fry tmyer-

1

O o ^Cfc*7

Jn o^/<)o//g &OA

11-0

o<0 V

To -f-Yftinci pool supervisor

AT

O o Q>7

(n /nc.ofn/fiq &*>*

If

O o<p V

To i~yp/^t*

J~o

O o J3>V

//> incoming b^A.

o<s: a v

fro t-ypccl

/S*

O o 13^7

P>enc'f/ JL typed order fti ou"f-gotnq box

sro

O o<D V

To /?t~oofre<fc/er'f dcsH

2-.T

O o CT^7

In in coming &o*

O o DCV

Pr*<fireq4 & checked for (ample fencsf S (?cW"<7cy aTcxT^/Twiw

1.0

O o Q^7

In oa^O/'/rq >ox

I 90

O cxCQ V

"To buyer

+S*

O o 077

/n //7CO/TT//IQ /OX

O o CXV

yQc^/fivfe</ <?/?</ /A//>'^/e</

2-0

O o LL^7

//7 o i< /-g o / A? g /!> o x

loo

O o<0 V

To /o^rc/?q^//79 qqen/"

/OO

O o ay?

//? //7CO/T7//7O b<>X

O o EXV

Reviewed ancf s/qn<:<{

2LO

o o a v

In o/-$ 0/^79 ^>ox

o o a v

o o a v

o o a v

O o Q V

o o a v

o o a v

O o O V

O o D V

o o a v

o o a v

o o a v

o o a v

o o n v

o o a v

o o a v

S8^ {

330

Figure 25. Proposed Process Chart shows advantages of the new pur-
chase order preparation procedure evolved from analysis of the method
shown in Figure 24.

93

94 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

tration is achieved because no number can be used twice and one extra
copy of the order can serve in place of the information provided by
the register.

8. When should it be done?

In the present procedure, the purchasing agent signs the purchase
order before it has been reviewed by the buyer. This is inadvisable be-
cause the purchasing agent does not have the initialed approval of the
buyer and the purchase order becomes a valid contract upon the
agent's signature. There is always the danger of an incorrect order
being released without the review of the buyer.

9. Where should it be done?

By relocating the typing pool nearer the buyers, the distance for the
required transportations could be cut to less than a quarter of what it
is under the present lay-out.

As a result of this careful consideration of the purchase order pro-
cedure, a new proposed procedure was developed and a new Process
Chart prepared. It is shown in Figure 25. It is seen that the total
number of steps has been reduced from 35 to 20: operations from 6 to
2; transportations from 8 to 5; inspections from 6 to 3; and storages
from 15 to 10. The distance travelled has been cut from 2,680 to 585 ft.
and the storage times from 475 to 330 minutes.

ELABORATIONS OF THE PROCESS CHART

Using the simple basis of the process chart just developed, elaborate
process charts of great complexity have been designed and used by
some people for systems analysis. Although some complexities may be
valuable for certain applications, the writer has found that, by and
large, the systems man will do well to apply to his own investigations
the rule: a simple- system is usually the best system. Overcomplexity
can be very confusing.

The two principal avenues of elaboration of process charts are:

1. The addition to the form of extra columns and spaces for additional
information.

2. The use of many different symbols for visually indicating and
classifying the types of operations.

The use of one or two symbols in addition to the four standard ones
just described is sometimes useful when certain unusual types of steps
occur with great frequency in a procedure. In such cases, of course, the
symbols used should be carefully described in the legend on the chart.

System

Procedure Study Sheet

Date

Prepared For (Company Location. Sponsor)

Job Assignment Ho.

Form :

Form No.

Title oi Copy Copy No.

<> &* M "

H^oTd 1 * D Inspection

O Handling V / Hold. Delay. Fil*
Operation ^ Or Sloraa

Question Each Step
What Is done? WHY
Where is it dono? WHY
When is it dono? WHY
Who does it? WHY
How is it done? WHY

Indicato Type oi Improvement For Each
Can it be eliminated? If so. indicate by E
Can It be combined If combine, mark C
or changed in sequence If chan^o in sequence,

Con it bo simplified? If so, rnar)e_ S

Slop

Symbol

Description

No. of
Opor.

Wage
Bkt.

or Dist.

Moved

Notes Questions Improvement

On* of th Paperwork Simplification tooU of
Th Standard !UaltT Company, Dayton, Ohio

Courtesy Standard Register Company of Dayton, Ohio

Figure 26. Process Chart Form gives more information and additional
symbols.

95

96 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Courtesy Remington

Figure 27. Process Analysis Chart-shows debit-posting operation requiring
Proofing and stuffing work is eliminated under the new method, which offers

In Figure 26 is shown a more elaborate chart form which contains
key questions to promote simplification of ideas. Figure 27 illustrates
another example of an elaboration of the first kind which might prove
useful. The use of many different symbols in charting is illustrated in
the organizational process chart application shown later in Figure 32.
The symbols for the legend in this chart were drawn from the more
complete list of symbols shown in Figure 28. These elaborations of the
simple process chart may prove valuable to the analyst. By virtue of the
added rigors required of him in preparing the chart, they may force
him to a better understanding and analysis of the system he is studying.

The procedure being process-charted might involve routines which
start as a single sequence but later branch out into two or more

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS

97

PROCESS mitJIJ WORI SNEET

0000001
0000000 yyp

00000?

000001 ?y VD"

0000010 t^
000009 fyp~
000000 ^

0000019 fyn

00000QOWC

"0000001 oy

0000016 fyp

00006,0^'

1

Rand, Inc.

25 steps. The same operation is then shown charted in only 10 steps,
a minimum of clerical drudgery.

sequences which are performed at the same time. Figure 29 shows one
method of process-charting such a procedure. Sometimes two or more
sequences of steps start out separately and are later united in the per-
formance of the function. These procedures are handled similarly, the
two or more branches coming together, instead of the branching out
process shown here. Such a procedure is charted pictorially without
benefit of the process chart symbols in the chart of a punched-card
payroll procedure on page 262.

STANDABDS FOR CONSTRUCTION OF PROCESS CHARTS

A special committee of the American Society of Mechanical Engineers
has developed standards for the construction of operation and flow

o

Transraittal .

PPOCEDURE CHABT SYMBOIS

for
OFFICE OPERATIONS

Type,

Send by messenge*.

Voucher preparation.

Deliver personally.

Tine- stamp. (Also indicated
date stamp.)

O

Miscellaneous operation for
vhich there is no specific
symbol.

Subsequent operations on
indicated documents or
process not necessary to
the particular chart.

Numbered, stamped, etc.

Perforation, such as:
cancellation of a
security or coupon;
or affixing dates.

Fill in form.

Posting in ledger,
etc. (By hand.)

Prepares letter, report, etc.

Posting in ledger/
journal, etc.
(By machine.)

A subsequent; return to the
f lov of indicated documents
from a unit vhose particular
operations are not important
to the instant chart.

Sign letter, memo, etc.

Fecord in diary.

Sort.

Assemble.

From Administrative Planning Series Number III,

Figure 28. These thirty-nine procedure chart symbols provide a detailed

98

PROCEDURE CHART SYMBOLS

for
OFFICE OPERATIONS

destroyed.

Distribute to tvo or
more people.

Confer - tvo or more people
vorking together.

Note and sign. (Surname.)

Transmit information by
telephone .

D
O

Check for quantity.

Check for quality.

Check for both quantity and
quality. (Examine.)

Inspect for quantity and
perform operation.

Inspect for quality and
perform operation.
(Select, check, and make
entry.)

Search of temporary file*

Approve. (Administrator's or
Division Head's perfunctory
signature --Actual, official
final approval by anyone.)

Search of permanent file.
/ \ Received.
/P\ Receive information by

telephone.

File temporarily.

Extension proof or other
mechanical check of an
Arithmetic operation.

Document, form or other
paper. For example,

13 I
original and three cop lea
of Form Fl-1^9*

V^* ~^> Discontinuity; interrening
Tile permanently. functions unimportant to

the chart.
Office of the Secretary of War

categorization of the kinds of operations found in office procedures.

99

PROCESS CHART- INDUCTION PAPERS

ADJUTANT GENERAL'S OFFICE- ENLISTED BRANCH

RECORD EXAMINING SUB- SECTION

7.5. ^irwy Service Forces Manual M703-3

Figure 29. Process Chart of an Induction Papers procedure illustrates a
neat method of process-charting a routine which branches out.

1 00

FUNCTIONAL ALLOCATIONS AND SYSTEMS PLOWS

101

process charts. This committee standardized on five classifications ot
activities: operation, transportation, inspection, delay, and storage. In
Figure 30 is shown a process chart of a requisition for supplies pro-
cedure, which has been constructed in accordance with these standards.

PROCESS CHA2T

Chart Begins at Machine Shop Foreman's Desk,

Ends on Typist 'a Desk In Pur. Dept. 1 Chart We,

Order Ho. Lot Size

Dept.

BfaMt 1

Charted by C.H.H. Date Charted 7-28-45

Bid*. If. B. Lb

of 1 8bU

1000

8000

1 1 ) Written longhand by foreman

I i ) On foreman* a deak (awaiting messenger)

By messenger to secretary of head of department

On secretary's desk (awaiting typing)
(2} Typed

[|> By messenger to head of department
[3) On head of department *a deak (awaiting approral)

Examined, approved and coded (signed and code i

On bead of department'a deak (awaiting messenger)

To Purchasing Department

On purchasing agent'a desk (awaiting approval)
| 2 I Examined and approved

On purchasing agent' a deak (awaiting messenger)

To typist ' deak
[7) On typlat5 deak (awaiting typing of purchase order)

ASME Standard "Operation and Flow Process Charts"

Figure 30. Process Chart of a requisition for supplies.

ORGANIZATIONAL PROCESS FLOW CHART

The Organizational Flow Chart portrays the departmental relation-
ships of various phases of interdependent activities. The Process Chart
is a detailed chronological record of the successive steps in the per-
formance of an activity or function, these steps being categorized by
type. The Organizational Process Flow Chart is a combination of these
two graphic systems: columns or rows labeled for the organizational
unit or persons performing the activities of the procedure; the steps
graphically portrayed by the process chart symbols.

The Organizational Process Flow Chart is especially valuable for the

102

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

PRESENT

CERTIFICATION UNIT

MAIL
CLERK

FILE
CLERK

ADDRESS
CLERK

CORRE-
SPONDENCE
CLERK

STENO POOL
SUPERVISOR

STENOG-
RAPHER

CASE
EDITOR

SECTION
CHIEF

U.S. Bureau of the Budget Management

Figure 31. Organizational Process Flow Chart presents effectively the

analysis of the detailed steps of relatively complicated procedures in
which the activities are performed by a number of organizational units
or persons.

Two examples of this type of chart are shown. In Figure 31 we see
an analysis of a certification procedure. In this case, the organizational
units are represented by the labeled rows. The symbols used are the

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS

103

PROCEDURE

- FIELD BRANCH

1945

ssA-O

ANALYZING THE CHART

dure?
WHO U th<

Bulletin "Process Charting''

proceduce of the Certification Unit and poses pertinent questions.

standard ones presented in our discussion of the process chart.

The questions to be used in the analysis of this type of chart are
similar to those presented for both the Organizational Flow Chart and
the Process Chart of which this chart is a combination. The where,
why, how, when, and who questions are illustrated right on the chart
of Figure 31.

PROCEDURE FOR ANSWERING CREDIT INQUIRIES

OUTSIDE

MAIL AND RECORDS SECTION

MAIL UNIT PERSONNEL RECORDS UNIT

INFORMATION CLERK

OFFICE
CONCERNED

CREDIT
ORGANIZATION

Credit inquiries Forwarded-
letters, forms, etc.
MISCCORRESl

Forwarded

Correspondence removed
envelopes

l. Credit inquires

correspondence

LEGEND
(^) Miscellaneous
/\ Received

Time Stamp

Sort

Search of permanent file

Prepare

Noting
I Document

File permanently

Check for quality

Subsequent operations
not necessary

a. Record cases

b. No record cases
a

PA I/O Form
rj reply letter

Inquiry ft folder

l/0 Reply
to inquiry

^ I

|Attaches form letter or
'reply to inquiry; remove*
file

From Administrative Planning Series Number HI, Office of the Secretary of War

Figure 32. Organizational Process Flow Chart of a procedure for answering
credit inquiries, utilizing an elaborate legend.

104

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 105

In Figure 32 is shown a second example of the Organizational
Process Flow Chart. In this chart, the organizational units are repre-
sented by columns. The symbolic system is quite a bit more complex,
using symbols chosen from Figure 28 on page 98. This type of more
detailed symbolic analysis is very valuable on some occasions. How-
ever, the writer has found that the simpler chart using four to six
standard symbols is more valuable for most purposes because of its
greater understandability.

FORMS DISTRIBUTION CHART

The Forms Distribution Chart is a specialized Organizational Flow
Chart for portraying and analyzing the distribution of the several
copies of a form. As in the Organizational Flow Chart, the column
headings indicate the organizational units receiving and/or transmit-
ting copies.

This type of chart is valuable for quick, easy portrayal of how each
copy of a form or report is distributed and for cursory analysis of pos-
sible improvements in the distribution. However, because it achieves
its simplicity by eliminating explanation of the details, it can seldom
be used as the sole means for a complete analysis to promote the great-
est possible improvements.

QUESTIONING PROCEDURE

For portraying a relatively simple distribution pattern, a chart such
as shown in Figure 33 is very useful. To analyze the distribution plotted
on this chart, the following questions are suggested:

1. Why is each copy needed?

2. Are other copies needed?

3. How many copies are filed by the various groups? Are all these files
essential?

4. Can one copy be circulated to eliminate the requirement for one or
more other copies?

5. Do any groups get duplicate copies? Are they both required?

6. Do the clearest copies go to the right groups?

7. Does back-tracking of copies indicate overcomplicated or useless
paperwork movements?

These questions are not aimed at analyzing the design of the form or
at a completely comprehensive consideration of its uses. Only the more
obvious aspects of its distribution are being analyzed.

106

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

FORMS DISTRIBUTION CHART

STORES REQUISITION (T456)
PRESENT METHOD

Copy

Inventory
Control
Section

Stores
Section

Assembly
Section

Accounting
Deportment

/. White

. ,

^

*-(psp e

2. Pink

O, __ ,..,,

c\

.,/">

with material
then destroyed

3. Yellow

rO

O

filed

4. Green

O IIM

r Q

filed

5. Blue

f?led

Figure 33. Forms Distribution Chartshows the paths followed by the
various copies of the stores requisition.

SAMPLE FORMS DISTRIBUTION ANALYSIS

1. Why is each copy needed?

Investigation discloses that the accounting department requires its
copy for keeping its inventory records* the assembly section uses copy
#2 (pink) to identify the material until it is used in the assembly units
and copy #3 (yellow) for a reference file; the stores section posts to its
bin card stock record from copy #4 (green); and copy #5 (blue) is
used by the inventory-control section to post to the inventory record
and is then filed.

2. Are other copies needed?

The assembly-control section, which is responsible for scheduling,
loading, and controlling material in the assembly section, should know
for its status records what material has been moved to the assembly
floor. It should therefore receive a copy.

3. Are all fled copies essential?

Of the four copies filed, only accounting and inventory control really
need the files for verification and justification of their records. Two
complete files in the plant would be sufficient for all needs.

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS

107

FORMS DISTRIBUTION CHART

STORES REQUISITION (T458)
PROPOSED METHOD

Copy

Inventory
Control
Section

Stores
Section

Assembly
Section

Assembly
Control
Section

Accounting
Department

/. White

O,

-("*

WrfN

O-,

^O

signed

filed

2. Pink

o

filed

3. Yellow

O P .

with material
then destroyed

Figure 34. The simplicity of the proposed Stores Requisition procedure
becomes apparent when this chart is compared with Figure 33.

4. Can copies be eliminated by passing along?

The stores section does not require a file of requisitions. By posting
to the bin card from copy #1 (white) when the material is disbursed,
copy #4 (green) will not be required.

5. Are any duplicate copies received and required?

The assembly section receives both copies #2 (pink) for identifying
the material and #3 (yellow) for filing. The filing copy can be elim-
inated.

6. Do the right groups get the clearest copies?

The inventory-control section keeps copy #5 (blue), which is the
worst copy, to post to its records, whereas #2 (pink) and #3 (yellow)
are given to the assembly section. However, the importance of good
visibility is much greater for inventory control than assembly.

7. Is there useless back-tracking?

Yes. Copy #1 (white) goes back to the stores section where the
signed acceptance is recorded before the copy is forwarded to the
accounting department. This is unnecessary since the signed accept-
ance is always available in the accounting department for verifications
and the verifications are seldom required. The control function which
the stores section performs in insuring that accounting gets its copy can
be performed by the assembly-control section, by having serially pre-
numbered requisitions.

On the basis of this analysis, a new Forms Distribution Chart is con-

108 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

OUTBOUND SHIPMENTS BY CONTRACTORS FOR WAR DEPARTMENT INSTALLATIONS

ISSUING OFFICE
TRANSPORTATION OFFICER

ORIGIN CARRIER

Tronsportafion officer
prepares in original
and 8 carbon copies.
(See Note A.)
Copy 9 retained as a
pending copy.
Copies I through 8 are
sent to contractor with
JeMcr of instructions'
relative to completion
and distribution.

Completes copy 9.
Files copy 6.
Distributes copiet 1.
5,7and9asindicoted.

Furnishes additional

Sends all copies to
carrier for receipt.

Retains copies 2. 3 & 4.
Files copy 2.
Gives copy 3 to the
freight conductor.
Sends copy 4 K> the
carrier's auditing de-
partment.

Receipts copies 1, 5, 6,
7 and 8 and returns
them to contractor.

U.S. Army Service Forces

Figure 35. Forms Distribution Chart, with symbolic representation of the

structed. This chart, shown in Figure 34, has a simpler, more direct
distribution pattern. Two copies of the form have been eliminated.

FORMS DISTRIBUTION CHART VARIATIONS

Three additional examples of the Forms Distribution Chart are
shown to indicate some of the variations which may be useful. The

FUNCTIONAL ALLOCATIONS AND SYSTEMS FLOWS 109

(EXCEPT LEND-LEASE SHIPMENTS TO PORTS OF EMBARKATION)

CONSIGNEE

CHIEF OF
TRANSPORTATION
WASHINGTON, O.C.

DESTINATION CARRIER

PROPERTY RC V D

L

h.

I"

I

Accomplishev th origi-
nal and sends to me des-
tination carrier.
Files copy 5-

Used for statistical pur-
poses.
Filed.

Computes charges
and bills Finance Of-
ficer.

MISCELLANEOUS

NOTE: A: U the bill of
lading forms used ore
pro-assembled in car-
bon-interleaved sett.
copy 9 will be included
in each set because of
its frequent use.
If carbon-interleaved
forms are not used,
copy 9 will be added as
and when required.
When copy 9 is not
added, copy 5, 6, or 7
may be used as the
pending copy if neces-
sary.

Authorised uses of this
copy are listed in Part I.
paragraph 2, page I.Ot
of this manual.

Mamtal M404

different copies of the bill of lading. The presentation is very effective.

example in Figure 35 is a bit more elaborate than the chart of the
distribution of the material requisition. The use of limited textual mate-
rial gives valuable information which may aid analysis. This type of
chart is frequently used for instructional and demonstration as well as
analytic purposes.
The Forms Distribution Chart on the processing of the copies of a

o

oc
fc
o

CC

g

o

51

el

Is

bJ ._

SO
i

oc
u
a

The flow chart shown above graphically illustrates the routing of the
Purchase Requisition, the Purchase Order, the Receiving Report and the

Stores Requisition.

Courtesy Remington Rand, Inc.

Figure 37. Flow Chart.

Ill

112 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

questionnaire is shown in Figure 36. This chart has a clean simplicity.
It clarifies a relatively complicated distribution pattern so that it may
be carefully analyzed.

The Forms Flow Chart of Figure 37 does not as clearly classify move-
ment between departments, but it does graphically show the routing of
the various copies of the form. An example of a pictorial forms chart
useful for instructional purposes is shown at page 262 of Chapter XII.

NO MAGICAL CHAKTING TECHNIQUE

None of the charting techniques presented in these discussions will
by itself provide you with a single systems answer nor will any one of
them necessarily provide you with the best system. These techniques
provide ways of arranging systems facts in clear, understandable form.
Then, using common sense and past experience, applying the principles
developed in Chapter III, and asking some key skeptical questions,
ways of improving the procedures may suggest themselves. These sug-
gested improvements must themselves be subjected to the same critical
analysis as the existing system to insure that they are truly best.

VI

ANALYZING THE LAY-OUT

COLLEGE FOOTBALL

team constitutes a segment of an enterprise with a definitive purpose,
a formal organizational structure, and a very highly specialized set of
formalized systems. Many of these systems are, of course, the various
plays established by the coaches and team. If these plays or systems
are not effective, then the team will not accomplish its purpose of
achieving victory. One of the most important factors in determining
the effectiveness of a football play is the physical relationship of the
individual players. If the blocker is not in the right position to protect
the punter, the play will probably fail. If the receiver is not in the
predetermined proper place to receive the pass, the play will most
assuredly fail. And the defense play will undoubtedly fail if the end
is pulled out of position. The physical relationship of the various mem-
bers of the team constitute an essential part of the play or system and
is a prime determinant of the success of the team.

Just as the physical arrangements or lay-outs of the football team
are an essential part of the football systems or play, so the physical
lay-out of the enterprise is an essential part of the systems of the

113

114 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

enterprise. A poor lay-out can seriously impair the effectiveness of the
enterprise's operations. The preparation and revision of lay-outs is
therefore an integral and essential part of the systems function. No
lay-out can be established or revised without a thorough consideration
of the systems which will be affected. A new system or a systems re-
vision must always be coordinated with an existing or proposed
lay-out.

In this chapter we will deal almost exclusively with the office lay-
out, recognizing the fact that the systems analyst attaches no small
amount of importance to the factory lay-out. However, the systems
analyst is usually more directly concerned with the matter of office
lay-outs because most systems and procedures take place in the office.
Nevertheless, the lay-out of the manufacturing departments will very
frequently have a great effect on the character, costliness, and success
of the factory systems. In addition, the location of the offices with
relation to the factory operations they serve is of great importance.
It is therefore a wise and necessary procedure to require the production
engineers to consult with the systems engineers in preparing the lay-
outs of the manufacturing departments.

IMPORTANCE OF OFFICE LAY-OUT

The office lay-out is of prime importance to the systems man. Space
constitutes a communication obstacle. It costs money to bridge this
obstacle by means of forms, letters, phone calls, etc. The physical
arrangements of the office greatly affect the number and volume of
the media of communication which are required.

Space is not only an obstacle but it costs money in the form of rent
and building and plant costs. The more space required for operation
of the enterprise's systems, the greater the costs.

The morale and efficiency of the office workers who operate the sys-
tems are affected for better or worse by the heating, lighting, venti-
lation, and visual and acoustical properties of the office. The systems
analyst is therefore prompted to insure that these lay-out considerations
receive proper attention.

Before considering the detailed mechanics of making an office lay-
out, it would be valuable to discuss some of the more general systems
principles and problems associated with office lay-outs. (The need for
conformance with building and fire regulations is a non-systems con-
sideration which vitally affects office population density, aisle width,
exits, etc. These regulations will vary in different communities.)

ANALYZING THE LAY-OUT 115

REDUCTION OF LINES OF COMMUNICATION

A good lay-out reduces communication lines to a minimum and
keeps them simple. Straight-line flow of forms, records, etc., with little
criss-crossing of items, is desirable. A straight line is the shortest dis-
tance between two points and short communication lines reduce op-
erating costs. The less criss-crossing and complications in the com-
munication lines, the simpler and less confusing are the procedures.

CONSERVATION OF SPACE

An effective lay-out should conserve space as much as possible with-
out hindering operations by cramping individuals or departments.
When properly done, conservation of space may save an organization
large sums of money.

ACCESSIBILITY TO PUBLIC

Offices which require a great deal of contact with the public should
usually be located so as to accomplish the following two objectives:

1. They should be conveniently accessible to the public.

2. They should be located so that outsiders are kept away from other
departments of the enterprise.

In a manufacturing enterprise, it is therefore generally advisable to
have these offices segregated from the factory and located at the main
entrance to the plant. Some purchasing, sales, and personnel activities
fall in this category.

A student of the author, Lt. Colonel Philip Y. Browning, writes as
follows about the effects of ignoring this consideration in the lay-out
of temporary army depots in the last war:

When the U. S. Army constructed their large temporary depots in the
Philippine Islands, evidently not much consideration was given to this factor
of physical layout because the local issue sections were generally located
in the center of the depots instead of at the entrances. As a result all agencies
drawing supplies had to enter the depot to transact their business. Due to
security difficulties, traffic problems, division of workers, etc., this plan of
operation was ineffective. In addition, the systems that had to be established
to take care of the situation became very involved, burdensome, and costly.
As a result, the physical layouts were eventually corrected where possible.

116 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

It is believed that this additional cost and effort would have been avoided
if this factor had been originally considered.*

As corollary to the two previous statements, units performing secret
work, or activities which it is desired to keep from the public, should
be located far from the functions requiring public contact. These secret
activities should be kept away from the public thoroughfares as well.

ORGANIZED ABOUT IMPORTANT FLOWS

The office lay-out should be built around the major flows of work.
The minor activities should be grouped around the major functions.
This increases the flexibility of the lay-out so that, when more space
is required, the minor activities can be shifted to provide more space
for the major function. Thus, the space arrangement and relationships
of the major units would not be disturbed.

FLEXIBILITY

An office lay-out should be flexible. The partitioning arrangements
should be planned to allow for maximum relocability. The use of
standard movable partitioning units will reduce the cost of such
changes as are nevertheless required.

Expansion plans should be forecast as much as possible. Allowances
for such changes in lay-out should then be made to reduce the extent
and cost of interim moves to a minimum. It might thus not be desirable
to place next to each other two large departments which were expected
to expand.

Another consideration which may seriously affect the flexibility of a
lay-out is the amount of special wiring, plumbing, ventilation, or other
special facilities which are required by the departments. Moving these
facilities is very expensive. Such departments should therefore be
placed so that their expansion needs can be met without relocating.
They should not be located adjacent to each other because such an
arrangement surely restricts the possibilities of caring for expansions
without relocating at least one of them.

PROXIMITY TO UNITS BEING SERVICED

Offices which coordinate and service the operations of units of the
enterprise should be located as close as possible to the units they con-

* From a paper prepared in connection with the author's graduate course at the
College of Engineering, New York University.

ANALYZING THE LAY-OUT 117

trol or service. Space constitutes an obstacle to effective coordination
and should therefore be minimized.

In a manufacturing enterprise, for example, the production-control
activity should be located close to the shops whose activities it con-
trols.

For similar reasons, the offices of the executives who control the
operations of various offices should be placed close to the offices they
supervise. The closer the executive is to the offices he controls, the
greater the ease of supervision.

PROXIMITY TO RELATED UNITS

Departments that have the greatest amount of cross-communication
of information should be placed closest to each other. To reduce the
work flow to a minimum, departments that work closest with each
other should be located in adjacent areas. The receiving and incoming
material-inspection departments might be a good example of these
related activities in one enterprise.

PRIVATE OFFICES

A private office may be defined as an enclosed work area for one
individual, sometimes including his secretary. The private office prob-
lem must be successfully solved if the office lay-out is to be effective.
This is a very touchy subject and requires much tact if some individuals
are not to be offended.

The private office problem may be divided into two parts: the de-
termination of a private office policy establishing the criteria for
ascertaining who should have private offices; and the application of the
policy actually to name the positions which are eligible for private
offices. Both of these aspects are of equal importance to the successful
solution of this problem.

Many office planners advocate a reduction in the number of private
offices. They claim numerous advantages for open, unpartitioned work
areas for clerical, administrative, and supervisory personnel. What are
some of these advantages?

1. Lower costs. Less space is required per person when open areas are
used instead of private offices; more office equipment may be
shared; partitioning and, in many cases, heating, lighting, and ven-
tilating facilities are cheaper when open areas are used.

118 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

2. Greater flexibility. Rearrangements may be more easily made to take
care of changing conditions when open areas are used.

3. Better lay-outs possible. Open areas are more readily arranged to
provide effective communication and most direct flow of work.

4. Reduced time waste. Unnecessary visiting may sometimes be re-
duced.

5. Ease of supervision. In many instances, supervision and control may
be exerted more effectively in open offices.

Despite the foregoing advantages of open office areas, there are
many situations which call for private offices. Private offices possess
many advantages:

1. Secret work. A person performing confidential work may require
complete privacy.

2. Freedom from noise and distraction. A person who performs work
requiring a high degree of concentration may be more effective in a
private office.

3. Facility for contacts. When an individual must be in frequent con-
tact with various inside or outside persons, the privacy of an en-
closed office may be desirable to facilitate interviewing as well as
to avoid distracting other employees in an open office,

4. Comfort, prestige, and morale. By adding to his comfort, increasing
his prestige, and improving his morale, a private office for a super-
visor or technical man may well pay for itself many times over.

Two devices have been used rather widely to reduce the number of
required private offices.

The use of conference rooms possesses an advantage over the private
offices in the ease of terminating interviews. They are at a disadvantage
when extensive reference material is required for the interviews. In
addition, all available conference rooms might be in use on some occa-
sions when an executive required one.

Most of the advantages of the open office are gained by the use of an
open area with railing separating each individual. These give prestige
and a good deal of privacy and are especially to be recommended
when the individuals must consult frequently with each other.

In establishing a private office policy, it is desirable to base eligi-
bility for a private office on needs as well as rank. All persons above a
certain relatively high rank would automatically be eligible. Positions
below this rank would be analyzed in the light of some of the ad-
vantages previously presented: " , - ""

ANALYZING THE LAY-OUT 119

Is an unusually high degree of concentration required?
Does the person perform a part of an operation sequence which
would be slowed down by a private office?
Are contacts with employees or outsiders frequent?
Is the work very confidential?

WORKING CONDITIONS

A good office lay-out should provide desirable working conditions
which will reduce strain and fatigue and maintain high worker effi-
ciency. The selection and arrangement of office space and partitioning,
the specifications for heating, ventilation, lighting, and decorations, and
the acoustic treatment of the walls and ceilings should be arranged to
promote the comfort and productivity of the worker.

PERSONALITY BIASES

Personalities should not be allowed to enter into the lay-out deter-
mination. The guiding principles should be maximum economy for the
total organization and the best possible working conditions for the
most people. Not only will this reduce costs, but it will render the
lay-out more stable: changes in personnel will not be as likely to
require alterations in the lay-out.

SYSTEMS INFORMATION

The initial step in applying these general principles of good office
lay-out is the acquisition of a basic knowledge of the operations per-
formed in the departments involved. Although a complete and detailed
systems analysis would be very helpful in planning the best lay-out,
it is possible to do a good lay-out job with a little less information
when the time is not available for the detailed survey. In all cases, it
is desirable to ascertain the following information:

1. Nature and flow of work in each department.

2. The flow of work between departments and sections.

3. The organizational locations and responsibilities of each organiza-
tional unit.

4. The relative importance and criticality of the work of each unit to
the fulfilment of the objectives of the enterprise.

5. Which time cycles are most important.

120 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

6. The number of persons performing the various categories of duties
in each organizational unit.

7. The kind and quantity of office equipment and machinery required
in each unit.

LAY-OUT OF PRESENT ARRANGEMENT

If a rearrangement is under consideration, it is generally desirable
to make a lay-out of the existing arrangement. This will usually materi-
ally help in planning an improved lay-out. It will aid in determining
required areas and clearances, expansions and contractions, and the
flow of work. Proposed changes can be more readily compared with
the existing situations. Most important, a Lay-out Flow Chart of the
existing arrangement can be constructed. This will help disclose where
improvements can be made.

SPACE REQUIREMENT STANDARDS

To allocate floor areas intelligently for the various offices of the
enterprise, it is first necessary to estimate the square-footage require-
ments of each office. When the problem is to rearrange a functioning
office which is already fully staffed with equipment and personnel,
then the existing areas, modified by the estimated effects of proposed
changes, may be used as a basis for estimating space requirements.

As a check on present space utilization practice and as a tool for
estimating space requirements for entirely new offices, various types
of space standards have been suggested by different office surveys and
planners. Moreover, these standards are materially affected by numer-
ous factors such as the nature of the work and equipment used, the
shapes of the available office spaces, the organizational structure, and
the private office policies of the company.

Various authorities offer differing standards for square-feet usage of
office space. Mr. K. H. Ripnen, who has done considerable work on
office planning, suggests the following standards: *

For each individual in the office, allot an average of 100 sq. ft. per person.

For each major executive private office, allot 400 sq. ft.

For each subexecutive, allot 200 sq. ft.

For each conference room for 10 to 12, allot 600 sq. ft.

For each reception room, allot 600 sq. ft.

* Kenneth H. Ripnen, "Space Standards in the Office Layout," Office Equipment
Digest, Nov. 1942.

ANALYZING THE LAY-OUT 121

For each interviewing room, allot 200 sq. ft.

For each central active file department, allot 5 sq. ft. per file.

For each inactive file department, allot 3M sq. ft. per file.

The average of 100 square feet per person for office workers provides for

office corridors; elimination of office corridors cuts the average to 80 square

feet per person.

Whereas Mr. Ripnen gives standards for over-all planning, Mr. R. L.
Foster gives detail requirement standards which must be applied on
the basis of the functional needs of the organization. These are shown
in Figure 38.

Surveys have been made at various times to determine actual space
usage per person. Although the area required for an individual may
vary from 50 to 500 square feet, an average of 100 square feet per
person is sometimes used as an over-all average figure for large com-
panies.

A survey of office space usage which was made in 1932 by Manage-
ment Methods in cooperation with the National Office Management
Association, disclosed the following practices in gross space usage per
person: *

Square feet per person

Line of business Average High Low

Manufacturing 106 402 36

Wholesale 77 163 67

Life insurance 177 416 84

Fire insurance 104 111 103

Banks 120 281 89

Financial 97 136 67

Railroads, utilities 99 153 72

Merchandising 110 118 101

All 127 416 36

ESTIMATING SPACE REQUIREMENTS

A plan is briefly described here for estimating approximate space
requirements, using standards such as those just presented, and with-
out reference to any existing lay-outs. This analysis should be made
separately for each department to obtain departmental estimates. Add-
ing up the departmental requirements gives the total required office
area.

The first step is to establish personnel space grades and space stand-

* "Yardsticks of Business Practice." (Pamphlet), Management Methods, Chicago,
Dartnell Corporation.

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ards for each grade. The space standards are prepared from area data
such as were presented in the previous section, modified in accordance
with company policy and/or past practice. For the company being
considered, the standards shown in Table I were adopted.

TABLE I. STANDARDS FOR PERSONNEL SPACE CATEGORIES

Category Description Square Feet

I Private office for top executive 350

II Private office for division manager 300

III Private office for department head 200

IV Open space for department head 150
V Open space for supervisory employee 100

VI Open space for secretary 70

VII Open space for clerk with large desk 50

VIII Open space for clerk with small desk 45

In the preliminary survey prior to attempting a lay-out preparation,
the number of persons in each category as well as the kinds and quan-
tity of equipment used were determined. The estimate of space require-
ments is then computed by multiplying each space standard by the
number of persons in that category and summing the products, as
shown in Table II. Special personnel who do not fit in any of the
standard categories are handled separately on a special listing ( Sheet
A) and then added. In addition, the space required for equipment
other than standard furniture must also be estimated separately ( Sheet
B). Sheets A and B are not shown.

TABLE II. WORKSHEET SHOWING COMPUTATION OF SPACE ESTIMATE-
DEPARTMENT Y

Category Standard No. of Total

(sq.ft.) Persons (sq.ft.)

I . 350

II 300

III 200 1 200

IV 150
V 100 6 600

VI 70 8 560

VII 50 27 1350

VIII 45 42 1890

Other (See attached Sheet A) * 3 780

Special equipment (See attached Sheet B) * 290

Total 5670

* Not shown here.

ANALYZING THE LAY-OUT 125

Space for various service areas must also be considered in estimat-
ing total square-footage requirements. Some of these are:

1. Coat rooms. Aisles should be at least 4 feet wide; wider if the open
coat rod and hat shelf extends more than 12 feet.

2. Locker rooms. Six-foot aisles should be allowed for 12-inch lockers
and 7 feet for 18-inch lockers.

3. Conference rooms. One which will accommodate about a dozen
persons should occupy about 600 square feet; 12 by 16 feet is the
minimum size for one with a 4-by-8-foot table.

4. Storage rooms:

a. Stationery and office supplies. Minimum of 3-foot aisles be-
tween open shelving.

b. Inactive transfer files. Minimum of 4-foot aisles.

c. Inactive records, binders, etc. Minimum of 2/2-foot aisles be-
tween open shelving.

5. Others. Vaults, showrooms, reception and interviewing rooms, rest
and recreation rooms, mailrooms, telephone switchboards.

FORECAST OF FUTURE REQUIREMENTS

After determining the present area requirements, future expansion
and contraction requirements should be predicted. One guide in mak-
ing such forecasts is the rate of increase in volume of work over the
past years. Top management plans for the enterprise and possible sys-
tems and organizational changes are other factors to be considered
in these estimates. The lay-out can then be designed so that it may
be adjusted to the forecasted requirements with minimum disruption.

FLOOR PLANS

Having estimated the present and future space requirements of each
of the offices, it is necessary to prepare or obtain floor plans, drawn to
scale, of the available space. Floor plans are prepared to scale, show-
ing walls, doors, windows, columns, telephone and electrical outlets,
permanent partitions, radiators, and all other building features which
might affect the lay-out.

Scale. The scale to use in constructing a lay-out plan depends on the
sizes of the areas being considered. A scale of four feet to the inch
( inch to the foot) is commonly found convenient. It is understand-
able and allows enough space for most required identifying notations.

126 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

However, if the area is very large, this small-scale ratio may make it
difficult to get an over-all view of the lay-out. In that case, eight feet
to the inch (Js inch to the foot) or, in some cases, an even higher ratio
may be used.

ALLOCATION OF AREAS

The analyst must now allocate the available areas amongst the vari-
ous departments. Using the principles developed in the early part of
this chapter, the areas are allocated and reallocated to the various
departments. Since there are numerous possible ways of allocating the
areas, the tentative assignments are juggled around continually until,
by trial and error, the best possible departmental arrangement is ob-
tained.

One factor not previously mentioned might influence these space
allocations. When certain areas do not have good natural illumination,
it is preferable to assign them to activities in which natural light is
relatively unimportant. Examples of these are lunchrooms, washrooms,
locker rooms, rest and recreation rooms, coat rooms, reception rooms,
telephone switchboards.

PREPARATION OF LAY-OUT

After the available areas have been allocated to the departments, the
partitioning and the lay-out of the furniture and equipment of each
office within each department may proceed.

An outline or template, cut to the same scale as the floor plan, is
made for each piece of equipment and furniture used. These tem-
plates can be home-made from heavy paper or light cardboard or can
be purchased ready-to-cut in a form such as shown in Figure 39.
When the outlines are home-made, a template such as is shown in
Figure 40 may be used sometimes to simplify the drawing of the
equipment outlines. It is well to have the templates cut from a color
which contrasts with the floor plan color. In addition, different colors
are sometimes used to differentiate between types of equipment or
departments.

If the lay-out is to be reproduced by photographic methods and
color distinctions are desired, the color scheme should be carefully
selected so that the various colors produce different shadings when
photographed. In addition, a color filter should be used to increase the
contrast.

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Figure 39. Templates such as these are printed to scale on heavy stock paper
or cardboard and can be cut out for use in lay-out planning.

127

128

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

|rr~T

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STEEL FILES I ""* "** SAFE-FILES 60

DRAWER

Courtesy Remington Rand, Inc.

Figure 40. Stencil Lay-out Template with punched-in guides: convenient
for drawing standard office furniture and equipment on lay-out plan.

Before these templates can be prepared, it is necessary to have a
complete list or inventory of the furniture and equipment going into
each department. This list should contain an accurate description of
the equipment, with dimensions, as well as the quantities. Ready iden-
tification of the equipment is promoted by having each item numbered
with a tab.

The identification number of the furniture and equipment is written
on the template. In addition, the name of the person using the item
is frequently indicated. The templates may best be attached to the
floor plan by a rubber cement. This facilitates relocations and changes
in the lay-out because the template can be easily removed from the
floor plan.

A lay-out of a small office is shown in Figure 41. To avoid serious
errors in laying out the office furniture and equipment within depart-
ments such as this, consideration should be given to the following
points:

1. In arranging open offices, aisle spaces may vary from three feet
and up, depending on importance: main aisles will usually be five feet
or over, depending on the volume of traffic and fire regulation re-
quirements. When files or other equipment open toward an aisle, the
aisle space should be calculated with the equipment fully extended.

Courtesy Policyholders Service Bureau, Metropolitan Life Insurance Company

Figure 41. A template lay-out of a small office.

129

130 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

2. The chair area behind each desk should be at least two and one
half feet. When several desks are lined up in a row, this passageway
(from the back of the rear desks to the front of the forward desks)
should be at least three feet.

3. To enable each person to get to his desk without disturbing any-
one else, it is preferable not to set more than two desks in a row.
When more than five or six are lined up, the amount of disturbance
will usually become acute.

4. In arranging coat rooms, locker rooms, conference rooms, and
storage rooms for stationery and office supplies and inactive files and
records, the minimum aisle widths mentioned in the section on esti-
mating office space requirements should be observed.

5. Whenever possible, files should be located against walls or as
aisle guides. To reduce the strain on the beams, heavy safes should be
placed as close to columns as possible.

6. Persons having most contact with other departments should be
nearest the door.

7. Wherever possible, persons performing fine, close work should
be placed closest to the windows or other source of natural light.

8. It is preferable for all employees in an office to face in one direc-
tion, with the light coming over the left shoulder or from the back.
For typists, the light may also come over the right shoulder. Placing
the back of a desk directly against a wall is undesirable.

9. Adequate exits should be provided from all partitioned areas.

THE LAY-OUT FLOW CHART

The Lay-out Flow Chart, such as shown in Figure 42, consists of a
simple lay-out plan on which the principal flows of work have been
indicated in colored pencil or crayon.

When the Lay-out Flow Chart shows considerable criss-crossing of
flow lines or indicates long transportations, an intensive study should
be made to ascertain if rearrangement would improve the situation.
Figure 43 shows how rearrangement can simplify and shorten the flow
lines of the office previously presented.

SCALE MODELS

Planning office lay-outs with scale models, such as shown in Fig-
ure 44, has some advantages. Placing scale models on a floor plan of
the office areas aids in visualizing changes. It is particularly useful in

ANALYZING THE LAY-OUT 131

conference planning sessions when models can be moved around to see
the resulting office. The finished lay-out can be photographed.

OFFICE ENVIRONMENT

Proper partitioning, good lighting, effective ventilation, low noise
level, and pleasant interior decoration all contribute to an effective
lay-out. All of these factors are interrelated and all are important in
the maintenance of proper office environment. In preparing an office
lay-out, the analyst must, in some cases, give considerable attention
to problems associated with these factors. These problems are in spe-
cialized technical fields and it will usually be valuable to consult
specialists in each field. The local lighting company, for instance, will
usually supply a competent lighting consultant without charge.

Partitioning. The type of partitioning used affects the flexibility of
the lay-out as well as the lighting, ventilation, noise levels, interior
decoration, and the privacy of the offices.

Lighting. The quantity of light, its color, source, and direction, as
well as the shadows and glares produced, are all important aspects of
the lighting problem.

Ventilation. Controlling the temperature, humidity, and airflows in
the office is a technical problem which vitally affects the well-being
and working comfort of the staff. In addition to maintaining uniform
and proper temperature and relative humidity levels, the introduction
of clean air, its circulation without drafts, and the emptying of the
exhausted air must be accomplished economically.

Acoustics. Reducing the noise produced by office machines and per-
sonnel, keeping out noises originating elsewhere, and deadening the
existing noises are the three principal aspects of noise control.

Interior Decoration. Although related to esthetics and taste, this
aspect is closely associated with the lighting and acoustic treatment
of the office. The different colors reflect varying amounts of light from
walls and ceilings. Since hard, glazed surfaces reflect sound very read-
ily, the use of soft drapes will materially reduce the noise level in many
offices.

LAY-OUT IS PART OF SYSTEM

A new lay-out is generally an integral part of a whole new system.
This new system must be sold to the supervisory and operating per-
sonnel as well as to top management; its installation must be planned

123

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Figure 42. Lay-out Flow Chart of a small office indicates tortuous
paperwork flows for both of the procedures (one indicated by solid
and one by dashed lines).

132

Figure 43. An improved lay-out of the office shown in Figure 42 has
resulted in this shorter, more direct paperwork flow for each pro-
cedure.

133

ANALYZING THE LAY-OUT 135

in detail in advance so as to disrupt normal operations as little as
possible (the timetable for rearranging the offices may be spread over
a relatively long period in order to accomplish this); and follow-up
activities must insure the proper functioning of the new system in
accordance with plan. These selling, installation, and follow-up activi-
ties are described in later chapters.

VII

ANALYZING THE MOTION
ECONOMY

"O FAR we have considered
methods of analyzing the broad systems flows, the allocations of activi-
ties and functions amongst the various departments of the enterprise,
and the methods and considerations involved in preparing office lay-
outs. These techniques are applicable to the analytic problems cover-
ing fairly wide scopes of activity.

When these broader details of the businesses operations have been
established on a sound basis, the analyst will want to turn his attention
to problems involving studies of smaller units of activity in much more
refined detail. He will want to consider methods of improving one
individual step or operation in the procedure which his previous anlyses
have determined was necessary.

Two tools for making these more detailed analyses are known as
motion study and micromotion study. These tools are especially valu-
able in analyzing operations involving considerable hand and body
motions, The essential difference between motion and micromotion

136

ANALYZING THE MOTION ECONOMY 137

study is a matter of refinement. Micromotion study involves the break-
down of the units of motion into such small elements that motion-
picture equipment is required in making the analysis.

Motion study can be a valuable technique for reducing effort, in-
creasing productivity, and lowering costs. Its goal is to enable the
employees to perform the operation under analysis more times with
less interruption, less effort, and less fatigue.

Before discussing the analytic charting technique which is used in
motion and micromotion study, it would be well to consider certain
basic principles which have been found very effective in promoting
motion economy in reducing the time required for the performance
of clerical operations, These principles are based on the work of many
men and women who have labored many years in the field of motion
economy. One of the first and most valuable formulations of the rules
for motion economy was developed by F. B. Gilbreth a number of
years ago. The principles stated below are based on his work as well
as the work of the many additional men who have labored so produc-
tively in this field.

The motion-economy principles presented below describe the con-
ditions under which clerical operations can be performed for the long-
est periods of time with the least effort and fatigue and consuming
the shortest average time. They are goals which the analyst should keep
in mind at all times when searching for methods improvements. It is
not possible to apply all these principles to all operations all the time.
However, to achieve maximum motion economy, the analyst must
constantly apply himself to produce motion patterns conforming to
these rules as closely as possible.

PRINCDPUE No. 1

Work should be performed with both hands which should begin and
end each element of motion simultaneously, and these simultaneous
motions should be in opposite and symmetrical directions wherever
possible.

The term "element of motion" is subject to varying interpretations,
depending on the fineness of the break-down, but the rule applies to all
break-downs. Thus, reaching for a piece of paper may be one element,
grasping the paper a second element, carrying the paper to a point in
front of the worker a third element, etc. If analyzed in more detail
by micromotion photographic study, this element of grasp might be
seen to contain four micromotion elements: search for the sheet, find
it, select it, and grasp it. In both of these analyses, it is desirable that

138 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

both hands begin and end each element of motion simultaneously.
The finer the analysis, however, the greater the possibility for economy.

The hand and arm motions in addition should be in opposite and
symmetrical directions because, in this way, the best physical and
mental balance is obtained.

The desirableness of these principles can be demonstrated somewhat
simply by the exercises illustrated and described in Figures 45-48.

4

LEFT HAND
AND ARM

RIGHT HAND
AND ARM

Figure 45. Motion Pattern: the right and left hands do not have
the same pattern.

LEFT HAND
AND ARM

2 4

RIGHT HAND
AND ARM

4 / /

Figure 46. Motion Pattern: the same but out of phase.

2 J

LEFT HAND
AND ARM

RIGHT HAND
AND ARM

'/ 4

Figure 47. Motion Pattern: symmetrical but not opposite, thus throwing the
body out of balance.

ANALYZING THE MOTION ECONOMY
3. 2

4

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139
J

RIGHT HAND

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Figure 48. Motion Pattern: opposite and symmetrical.

Compare the facility of performing these motion patterns.

Sometimes it is impossible to arrange the work so that the arms
move in opposite and symmetrical directions. In these cases, it is
more desirable to arrange it so that they move in perpendicular paths
rather than in the same direction.

One further point to remember is that when either hand holds the
work or is idle, this first principle is violated. The motion economy is
improved whenever this can be avoided by the use of fixtures to hold
the work and proper arrangement of the work elements to eliminate
idle hands.

PRINCIPLE No. 2

The activities at the work place should be arranged to provide a
smooth flow in the shortest line of motion with the simplest and fewest
motion elements.

A corollary to this principle is that the last element of motion in the
cycle should be adjacent to the first element.

This is a most fundamental rule for economy of movement requiring
consideration of three aspects of the elemental motions: elimination
of unnecessary elements; simplification of necessary ones; and re-
arrangement of the necessary ones so that the simplest, smoothest and
shortest sequences of a repetitive cycle result.

PRINCIPLE No. 3

Free, rhythmic, curved motions are preferable to controlled motions
which require sharp changes in direction.

140 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Rhythmic curved motions take less time and are less fatiguing than
motions requiring abrupt changes in direction. Thus, if the right hand
must pass through points A, B, and C shown in Figure 49 it is prefera-
ble to have a circular rhythmic motion than an abrupt angular one,
even though the distance is smaller using the triangular path:

A

o

o

B

Figure 49. Motion Pattern: when the hand is to pass through points A,
B, and C shown at the left, the circular motion pattern shown in the
center is preferable to the angular motion pattern shown at the right.

In using this free, rhythmic pattern, several factors should be kept
in mind. The opposite of a free motion occurs when you have opposing
sets of muscles contracting against each other to give controlled mo-
tion (one set of muscles overbalances the other). When, in writing, the
pencil is held between the index finger, middle finger, and thumb, the
finger muscles oppose each other and more fatigue is produced than
when the pencil is held in a freer position between the middle and
forefinger. In the free and easy swing of a golf club, the contraction
of single muscle groups is not opposed by the antagonistic opposing
muscles. This free swing is stopped by the dissipation of the momen-
tum of the movement when it hits the ball and continues its motion, or
it could be stopped by contraction of the opposing muscles (losing the
free motion). It is preferable to arrange the work so that the momentum
is not opposed by the worker, but, as much as possible, follows the
direction of the desired motion.

Professor Barnes, in his excellent text on motion and time study,
illustrates very effectively the importance of continuous curved motions
in his description of old and improved methods of folding paper.*

OLD METHOD OF FOLDING PAPER. The worker, holding a smooth piece
of bone in the palm of her right hand [see Figure 50], grasped the lower

* Reprinted by permission from Motion and Time Study-Sid ed. by R. M. Barnes,
published by John Wiley & Sons, Inc., 1949.

ANALYZING THE MOTION ECONOMY 141

right hand corner A of the sheet of paper to be folded. She folded this end
of the sheet over to point JB, where the two hands matched or lined up the
two corners of the sheet of paper. Then, swinging the right hand away from
the body and using the bone as a creasing tool, she struck the folded sheet
of paper about mid-point at C, creasing the fold from C to D. At D she
stopped and changed direction abruptly, doubled back, creasing the entire
length of the fold from D to E. At E the hand again changed directions and
swung around to F, where the end of the bone was inserted under the edge
of the creased sheet to assist the left hand in disposing of it on the pile of
folded sheets at G.

IMPROVED METHOD OF FOLDING PAPER. In the improved method the
worker grasps the lower right-hand corner A of the sheet of paper to be
folded [see Figure 51]. She folds this end of the sheet over to point B,
where the two hands match or line up the two corners of the sheet of paper.
She then moves the right hand through a smooth S curve, the bone striking
the paper and beginning to crease at X and ending at Y. Thus the entire
crease is completed with the single stroke of the bone. The hand then swings
around in a curved motion from Y to Z, where, as in the old method, the end
of the bone is inserted under the creased sheet to assist the left hand in
disposing of it on the pile of folded sheets at G.

RESULTS. By using the improved method described above only one creas-
ing motion was required to complete the cycle instead of the two (one
short and one long one) in the old method. Moreover, in the improved
method two curved motions of the hand were used instead of two complete
change directions and one 90 change direction in the old method.

A micromotion study of these two methods shows that 0.009 minute was
required to crease the fold by the old method and 0.005 minute by the
improved method. The improved method of creasing the fold, plus some
other changes in the cycle, reduced the total time from 0.058 to 0.033 min-
ute per cycle.

PRINCIPLE No. 4

Required muscular effort should be reduced to a minimum by keep-
ing tools as light as possible, sliding small objects, and using gravity-
activated devices to deliver and dispose of materials whenever possible.

Adherence to this principle reduces the work involved in an opera-
tion by disposing of finished work by dropping into a container; by
using small, economically designed portable equipment and tools made
of light materials; by pushing and sliding small materials and tools
rather than picking them up.

PRINCIPLE No. 5

Account should be taken of the inherent abilities and disabilities of
all the parts of the human body.

Many of these abilities and disabilities are not fully known and rec-

142 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Figure 50. Path of hand in creasing folded sheet of paper old method. Two
fold. In Figure 51, the improved method, a smooth "S" curve made by the
by permission from Motion and Time Study 3rd Ed., by R. M. Barnes,

ognized at present. Much productive research can and undoubtedly
will be done in this field in the near future.

It is usually considered desirable to restrict motions to the lowest of
the following numbered parts of the body as much as possible:

1. Finger 4. Upper arm

2. Wrist 5. Shoulder

3. Forearm

Thus motion patterns involving fingers alone have been considered
preferable to those involving forearm as well. This is very frequently
true. However, the free, rhythmic forearm and wrist motions are found
less fatiguing and faster for handwriting. It is therefore necessary to
take into account the total effect in each particular application.

In using the different parts of the body, a knowledge and consid-

ANALYZING THE MOTION ECONOMY 143

strokes of the bone, with abrupt changes of direction, are used to crease the
hand, is shown. Output was increased 43 percent. (Redrawn and reproduced
published by John Wiley & Sons, Inc., 1949.)

eration of the relative strengths of the muscles may be very useful. For
example, the right hand is generally stronger than the left hand. Also,
the various fingers have unequal strength and inherent work capacities.

PRINCIPLE No. 6

The feet and other members of the body should be assigned all
possible activities which will relieve the hands for other work.

Examples of the application of this principle are the use of foot-
controlled stapling machines and foot-activated collating and folding
machines.

PRINCIPLE No. 7

The materials, tools, and equipment controls should be located at
definite and fixed positions, preferably in the position in which they
will be used and within the smallest practicable adjacent work area.

144

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

The advantages of having tools, materials, and machine controls in
definite and fixed positions is relatively obvious; when the materials
and tools the worker must grasp are in the same place all the time,
hunting and searching for these things is eliminated; as the clerical
worker develops habitual automatic responses, mental effort and fatigue
are reduced; and, if all materials are grasped from the same point, it is
not ever necessary for the worker's eyes to follow his hands.

It is preferable to have these materials, tools, and equipment arranged
around and in front of the worker so as to minimize the muscular
effort of the operator in reaching them. In both the horizontal and
vertical planes, there is a normal work area for the right hand, for the
left hand, and for both hands. The normal work area for the right hand
is found by drawing an arc with the right hand, extending only the
forearm and letting the upper arm hang by the side of the body in its
normal position. Following the same procedure with the left hand,
the normal work area for the left hand is similarly obtained. The
normal work area for both hands working together is the area common
to both arcs. There are similarly maximum work areas for the right
hand, the left hand, and both hands together and these areas are
drawn in this case by arcs of the hands with the whole arms extended

Max. arc -left hand

Max. arc - right hand

Normal arc -
left hand

Normal arc -
right hand

Figure 52. The normal and maximum work areas are shown for each
hand of a clerical worker.

ANALYZING THE MOTION ECONOMY

Maximum work area \

145

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Figure 53. The normal and maximum work areas in the vertical plane are
shown for a mail clerk.

and pivoted around the shoulder. In determining the fixed positions
of materials, tools, and equipment, it is best to have them within the
normal work areas for the hands involved.

The horizontal normal and maximum work areas for a desk worker
are illustrated in Figure 52. The vertical normal and maximum work
areas for a mail room clerk are shown in Figure 53.

In arranging the fixed work positions for equipment and materials,
the more frequently used objects should be placed closest to the work-
ing area to minimize total traveling distance. Whenever possible, the
materials and tools should be placed so that they may be quickly
grasped in the position in which they will be used. A good example
of this kind of positioning for quick grasp is the standard desk fountain
pen and holder set in which the fountain pen is held in the fixed writing
position when not in use.

146 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

THE RIGHT-AND-LEFT-HAND CHART

To analyze the office and clerical activities to promote maximum
economy of motion, several charting techniques have been developed
which have proved very useful. One of the simplest and most useful
of these is the Right-and-Left-Hand Chart for analyzing the motions
of the hands in the performance of an activity. The chart is essentially
a process chart of each of the hands of the worker.

o

Operation
O Of c> Transportation
Hold
Delay
Position

^t^r

D
P

Figure 54. Some of the symbols used in
Right-and-Left-Hand Charts.

The basic symbols used in this chart are similar to those used in the
process flow chart. In general, only the first two symbols shown in
Figure 54 are required; however, on some Right-and-Left-Hand Charts,
other symbols, such as the last three, are used. The additional symbols
provide further categorization and differentiation of the types of mo-
tion elements involved in the activity.

In making a Right-and-Left-Hand Chart, it is usually preferable to
concentrate on the motions of each hand separately, listing the motions
for the one hand before analyzing the other one. After both hands
have been analyzed, then the symbols should be aligned, numbered,
and connected with solid lines.

In Figure 55 is presented a Right-and-Left-Hand Chart of an opera-
tion of collating and stapling three sheets.

ANALYZING THE RIGHT-AND-LEFT-HAND CHART

In analyzing the Right-and-Left-Hand Chart, each of the principles
of motion economy is reviewed individually and a determination is
made of where and how any of the principles are violated by the exist-

Collating 81 Stapling 3 Sheets
PRESENT METHOD

El lJ
IE!

A - Sheet I
B - Sheet 2
C - Sheets

- Stapler

E * Stapled sheets

F - Clerk

VET

LEFT HAND

RIGHT HAND

Towards right hand
Grasps sheet I

Holds sheet I

Towards Right hand
Grasps sheet 2

Holds sheets I a 2

Towards right hand
Grasps sheet 3
To front and center
Positions Sheets
To D (stapler)
Positions in O
Holds sheets in D

Releases sheets

To A

Grasps sheet I

Towards left hand

Releases sheet I

To B

Grasps sheet 2

Towards left hand

Releases sheet 2

To C

Grasps sheet 3

Towards left hand

Grasps sheets l t 2 t Q3

To front and center

Positions Sheets

To D (stapler)

Positions in D

To handle of D

Punches stapler D

To sheets

Grasps sheets

To E

Releases sheets

Figure 55. Right-and-Left-Hand Chart shows a break-down of the
present method of collating and stapling three sheets.

147

148 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

ing method. An attempt is then made to improve the motion patterns
by eliminating the violations.

The following list of questions is designed to test conformance with
the motion-economy principles previously presented and to suggest
possible improvements:

1. Is either hand idle at any time?

2. Do the hands stop and start at the same time?

3. Do the hands perform similar motion elements at the same time?

4. Does either hand hold material which could be held by a fixture?

5. Do the hands move in opposite and symmetrical directions?

6. Can any of the motion elements be eliminated?

7. Can any of the elements be combined?

8. Can any of them be simplified?

9. Is the work arranged for the shortest line of motion?

10. Are the last elements of motion in the cycle adjacent to the first
ones?

11. Do the motions have sharp changes in direction?

12. Are the motions free?

13. Is a rhythmic motion pattern present?

14. Can the finished work be disposed of by dropping?

15. Can sliding motions be used instead of picking up things?

16. Can the portable tools be made lighter?

17. Can muscular effort be reduced in any way?

18. Would greater speed and less fatigue be possible through the use
of only the smaller extremities?

19. Have the relative strengths and abilities of the different parts of
the body been considered?

20. Can the feet, or other parts of the body, operate devices presently
actuated by the hands?

21. Are the materials, tools, etc. located at definite and fixed positions?

22. Are all these positions within the normal work areas for the hands
involved? within the maximum work areas?

23. Are the tools and controls fixed in the position in which they are
used?

24. Is the work place arrangement as compact as practicable?

ILLUSTRATIVE ANALYSIS

A simple and common office operation is presented in the Right-and-
Left-Hand Chart shown in Figure 55. The method used for collating
and stapling three sheets is a common one in many offices. Having

ANALYZING THE MOTION ECONOMY 149

analyzed the motions of each hand and constructed this chart, we de-
sire to ascertain possible improvements by applying motion-economy
principles. The chart is examined carefully and each of the 24 ques-
tions is answered in turn.

Collating & Stapling 3 Sheets
Sfl- PROPOSED METHOD

rr

I \A

A. 3 tiered bin, holding sheets l f 2,B3 and having foot
actuated feed mechanism which extends top
sheets I inch over lip.

B. 2 foot actuated staplers with positioning guides.

v r\ ) C. Recessed box for stapled work.

^^ D. Clerk.

LEFT HAND RIGHT HAND

To A O O To A

Grasps sheets I,2,Q 3C\ C\ Grasps sheets I, 2,83

To B (stapler) A A To B (stapler)

Positions in guides r\ r\ Positions in guides

To C $ To C

Releases sheets f\ (\ Releases sheets

Figure 56. Right-and-Left-Hand Chart, with proposed improvements of the
operation shown in Figure 55.

1. The left hand is idle part of the time.

2. The hands do not stop and start at the same time.

3. They do not always perform similar motion elements at the same
time.

4. The left hand holds the sheets while the right hand punches the
stapler. A fixture could hold just as well.

5. The hands do not move in opposite and symmetrical directions.

6. The movement to front and center for positioning can be elimi-
nated.

7. The separate elements for grasping each sheet can be combined.

8. The positioning of the sheets can be simplified by the use of a
guide.

9. By placing the sheets in tiered bins, the line of motion can be
shortened.

10. The last elements in the cycle are not adjacent to the first.

11. There are relatively sharp changes in direction of motion.

ISO SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

12. The motions are quite cramped.

13. The pattern does not promote rhythmic motion.

14. The stapled sheets can be disposed of by dropping.

15. Instead of lifting the stapled sheets from the stapler, they can be
dragged to a recessed box for drop disposal.

16. There are no portable tools to be made lighter.

17. Muscular effort can be reduced by adopting a shorter, more
rhythmic pattern.

18. It is not practicable to use only the smaller extremities.

19. The relative abilities of the different parts of the body have been
considered.

20. The feet can be used to actuate the stapler and to feed the sheets
from tiered bins.

21. Materials, tools, etc. are located at definite, fixed positions.

22. Materials, tools, etc. are located within the maximum but not
within the normal work areas.

23. No tools or controls are fixed.

24. The work place arrangement can be made more compact by the
use of tiered bins to hold the sheets.

The proposed method, shown in Figure 56, corrects the violations
of good motion economy disclosed by the 24 questions. The stapling
machine is operated by a foot lever. Positioning guides are provided.
Three-tiered bins are used to hold the sheets. The top sheet in each
bin is fed one inch over the edge of the bin lips by a foot-actuated feed
mechanism. The new balanced lay-out permits opposite simultaneous
motions at all times within the normal work area.

The left hand now has 3 operations and 3 transportations as com-
pared with 7 operations, 5 transportations, and one idle. The right
hand also has 3 operations and 3 transportations now against a former
11 operations and 11 transportations.

SIZE OF MOTION ELEMENTS

One question which might be asked regarding the construction of
the Right-and-Left-Hand Charts is: how fine should the elements of
motion be broken down? For best results, the elements should, in
general, be broken down into the smallest readily visible units.

The finer the units into which motion is analyzed, the greater the
information which is obtained and the greater the possibilities of im-
provement. In addition, the greater the detail of the motion analysis,

ANALYZING THE MOTION ECONOMY 151

the greater is the opportunity to learn to understand motion study,
to learn what constitutes good and bad motion patterns, and how bad
patterns may be corrected. For these reasons, it is sometimes desirable
to go to the trouble and expense of making very fine break-downs and
timing these very small elements.

TIME STUDY ANALYSIS

In studying the operations of any system or details of any series of
motion patterns in the performance of a task, it is frequently valuable
to measure the time required for the various steps. Time study analysis
may prove very useful for a number of reasons:

1. It may provide clues as to which parts of the present system are
poorly performed, where waste exists. It points up the time-con-
suming elements of the system on which major effort should be
concentrated to make the greatest savings.

2. It provides a means of estimating the labor and time savings which
may be made by the introduction of improved methods.

3. The time actually consumed in the performance of clerical activities
may be compared with accepted standards to determine the effec-
tiveness of the worker's performance.

Time study analyses may be made in a number of ways. A stop-
watch may be used to ascertain the amount of time spent on each
element of the operation cycle. To ascertain the amount of time that
should be spent, standard time data may be used to construct a time
standard by synthesis. The micromotion analysis made with motion
picturesdescribed later in this chapter also provides a relatively ex-
pensive means of obtaining an accurate time study as well as micromo-
tion analysis.

The first step in taking a stopwatch time study is the logical sub-
division of the job into readily distinguishable elements. The descrip-
tion of each step should definitely indicate the transition points. These
elements are indicated in the headings of a time study observation sheet
such as shown in Figure 57. The lay-out of the task being studied should
also be shown, together with any other details required to clarify the
details of the task.

There are three principal techniques for taking stopwatch readings:
snapback readings, connected two-watch readings, and continuous
readings. The snapback technique involves starting each element with
the stopwatch at zero. At the end of each element, the watch is read,

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and their analysis.

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both sides of which are shown, permits recording of repeated observations

This form is used by permission of M. E. Mundel author of
Systematic Motion and Time Study, Prentice-Hall, Inc., 1947

153

154 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

recorded, and snapped back to zero. The time required for the snap-
back introduces some error in the readings.

The connected two-watch procedure involves the use of two watches
which are arranged side by side with a linkage which automatically
starts either of the other watches when one of them is stopped. In this
technique, the snapback time interval is reduced because the analyst
does not read the elapsed time until after he has started the other
watch.

In the continuous-reading technique, the analyst observes and
records the readings on the stopwatch as each element is completed.
The time for each element is then obtained by subtraction of each read-
ing from the previous. The continuous readings made by a competent
observer are more accurate than the snapback and possess the added
advantage that account must be taken in the readings of any idle time
or unnecessary steps. It does have the disadvantage of requiring sub-
traction of the successive readings. Because of its simplicity and accu-
racy, it is the most usual stopwatch reading procedure.

The time for the operation is obtained by calculating an average time
value for each element. Proper evaluation of this time also involves a
judgment of the skill, effort, and consistency of the worker as well as
the conditions under which the work was performed. This is known as
rating the worker's performance. In addition, to determine expected
output, allowance must be made for fatigue, avoidable and unavoid-
able delays, as well as time for the worker to attend to personal needs.

In Figure 57, the worker was rated at 115 percent of a normally
skilled worker operating with normal effort and consistency, and
under normal conditions. The allowance for fatigue, delays, personal
needs, etc., was 10 percent of the base time.

The use of standard time data for determining the time required for
the performance of various tasks may eliminate the requirement for
stopwatch readings. These standard data are based on many studies
of the basic time required for making various elementary motions.
The task is then divided into these small elements and a time stand-
ard synthesized by adding up the basic time requirements for each
element.

MIOEIOMOTION STUDY

To make the very fine analyses used in micromotion study, motion
pictures are usually taken of the activity and work place area, either
with a special constant-speed camera or with a microchronometer in

ANALYZING THE MOTION ECONOMY

155

the field of vision. If a constant-speed camera is used, the time for each
motion element is determined by counting the number of frames on the
film between the beginning and end of the element.

-STANDARD SYMBOLS AND COLORS FOR THERBLIGS -

SYMBOL

ABBRE-
VIATION

'NAME OF SYMBOL

NAME AND NUMBER
EAGLE PENCIL '

JOSEPH DIXOJT
PENCIL

CD

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Search

Black #747

379

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Gray #747*

352*

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352*

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Grasp

Carmine #745

321*

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Grass Green #738

354

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Lavender #742*

323

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Figure 58. Table of therbligs, with standard symbols and colors.

The film of the operation is analyzed into very small elements of
motion called therbligs. There are 18 therbligs. The symbols for these
therbligs are shown in Figure 58.

The analysis of the film is made on an Analysis Sheet, as shown in
Figure 59. The method of analysis is analogous to the method used for
the Right-and-Left-Hand Chart. The film is projected onto a screen,

156

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

MICROMOTION STUDY
ANALYSIS SHEET

PART Boit and washer assembly * Old Method DEPARTMENT AY16 FILM NO. B21

OPERATION Assemble 3 washers on bolt OP. NO. A32

OPERATOR M. Smith 1C634 DATE 1-26-48 ANALYSED BY M.E.R. SHEET NO. 1 OF 1

x

o 2

2

SUBTRACTED j
TIME

THERBLIG
SYMBOL

DESCRIPTION
LEFT HAND

CLOCK
READING

SUBTRACTED
TIME i

THERBLIG
SYMBOL

DESCRIPTION
RIGHT HAND

595

7

TL

Carries assembly to bin

595

26

TE

Reaches for lock washer

602

2

RL

Releases assembly

621

6

St+G Selects and 9 ps washer

604

4

TE

Reaches for bolt

627

7

TL Carries washe o bolt

608

2

St-tG

Selects and grasps bolt

634

6

P Positions was r

610

17

TL

Carries bolt to working position

640

12

A4R 11 Assembles w er onto bolt and releases

627

5

P

Positions bolt

652

8

TE I Reaches for el washer

632

104

H

Holds bolt

660

8

St+o' Selects and q sps washer

736

7

TL

Carries assembly to bin

668

9

TL

Carries wash o bolt

743

2

RL

Releases assembly

677

3

P

Positions wa r

745

680

10

A+Rl

690

6

TE

Reaches for ber washer

696

10

SMG

Selects and g sps rubber washer

706

9

TL

Carries wash to bolt

715

5

P

Positions wa r

736

Time In 2000ths of a minute

Figure 59. Analysis Sheet for bolt and washer assembly old method.
(Reproduced by permission from Motion and Time Study Sid Ed., by
R. M. Barnes, published by John Wiley & Sons, Inc., 1949.)

and one cycle is chosen for study. First one hand and then the other is
analyzed.

With the data from the Analysis Sheet, a very detailed Right-and-
Left-Hand Chart, with time as a vertical scale measured in winks
(1/2,000 of a minute) is constructed.

This chart is 'usually called a simultaneous motion or Simo Chart.
Figure 60 shows an example of such a chart constructed from the data
shown in the analysis sheet. It is essentially a Right-and-Left-Hand
Chart with two distinguishing features:

1. A much finer break-down of the elements of motion

2. A time scale in 1/2,000 of a minute intervals, giving the time
for each element of motion.

The same method is used in analyzing a Simo Chart as a Right-and-
Left-Hand Chart. Of course, the added element of time and the greater
detail enables a better evaluation of the importance of each element
and better knowledge of the true nature of the motions involved.

ANALYZING THE MOTION ECONOMY

157

MICROMOTION STUDY

SIMO CHART

PART Bolt and washer assembly-Old Method

DEPARTMENT AY16 HIM NO. 621

OPERATION Assemble 3 washers on bolt

OP. NO. A3?

-OPERATOR M. Smith 1C634

DATE 1-27-37 MADEBYS.R.M, SHEET NO 1 OF 1

DESCRIPTION ^
LEFT HAND f?

500 l ~* >

u TIME IN
j ZOOOTHS
*" OFAMIN

i

DESCRIPTION
RIGHT HAND

Carries assembly to bin TL

7 ^

_

600

~" Releases assembly RL

2 ^

= 1

610

Reaches for bolt ^E
Selects and grasps bolt y

2*

-^

26

E Reaches for lock washer

V/

=i

620

Carries bolt to working position jj.

4

= ^

6

Selects and grasps washer

630

Positions bolt *

5 ^

m

YW

7

L Carries washer to bolt

W

m

6

Positions washer

640

//

Lm

12

L Assembles washer and releases

650

/x

fc^B

y/.

E^ 8

E Reaches for steel washer

660

i

;fi 8

3 Selects and grasps washer

HI

670

y

: jl|g

L Carries washer to bolt

680

Holds bo(t H

//

= = CT3

P Positions washer

Ys

I -^fflin
: ^

^. Assembles steel washer and releases

690

7

6

1^6

E Reaches for rubber washer

-

YJ

"Tl 10

$ Selects and grasps rubber washer

70(

|f"

Xx

=y

710

L

V

:^9

[L Carries washer to bolt

;'

v/

- -z3
:i^ 5

p Positions washer

720

r-

YS

- teSig

V

:qJH

^ Assembles washer and releases

73

r

y

~ zfflijft}}}

74

L Carries assembly to bin T

7 |

m

r Releases assembly R

*

11

Figure 60. Simo Chart for bolt and washer assembly-old method.
(Reproduced by permission from Motion and Time Study 3rd Ed., by
R. M. Barnes, published by John Wiley & Sons, Inc., 1949.)

As a general practice, the added time and expense involved in mak-
ing micromotion analyses of all operations makes it uneconomical to
apply to most operations. However, when an operation is very highly
repetitive or is performed by a large number of workers, this added
expense may be worthwhile because any small additional saving de-

158 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

rived from the finer analysis of a micro-motion study will be multiplied
enormously.

There is, moreover, an important purpose for micromotion study as
a training tool. Although its principles are essentially simple, acquisi-
tion of ability to apply these principles with maximum effectiveness
comes only with much practice in following the fine details of motion
patterns. Micromotion study is thus an educational tool for becoming
motion-minded.

VIII

ANALYZING THE FORMS DESIGN

IRACTICALLY ALL of the com-
munication, reporting, analysis, and coordination of information
which is done in the performance of the systems of the enterprise
utilize forms. The forms which are used to facilitate these activities
may be good, mediocre, or bad. If they are poorly designed, the per-
formance of the functions involved will be seriously hampered.

Forms constitute a basic part of most systems. The design of the form
is a reflection of the design of the system. The form can only be
properly designed when the analyst clearly and completely under-
stands the systems for which it is to be usedits objectives, its require-
ments, and its functions.

A form may be defined as a duplicated document with blank spaces
for the insertion of data by hand (ink or pencil), by typewriter, or by
any other process. Reports and charts are prepared on forms.

As an integral part of one or several systems, the design of each form
is, of necessity, determined by the functions it performs in the systems.
There are, however, a number of fairly distinct general forms-design
problems which warrant separate study by the analyst. In this chapter

159

160 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

we will consider some of these design problems and develop some rules
for effective forms design.

Good forms design, made effective by adequate forms-control poli-
cies, will produce numerous kinds of savings for the enterprise: the
amount of clerical labor required for filling in the forms will be re-
duced; the frequency of clerical errors in completing the form will
be lowered; managerial efficiency will be increased by providing all
required information and eliminating non-essential data on forms and
reports; the printing and the paper costs of the forms will be reduced.

We will not consider here the analysis of the distribution of multi-
copy forms. Methods of analyzing this problem were considered in
some detail in Chapter V, where the Forms Distribution Chart was
discussed. Suffice it to say here that such an analysis should always
precede the design of a multicopy form.

In designing forms, the fundamental consideration is, quite naturally,
the maximum promotion of the systems objective. The requirements of
the procedure are therefore the prime determinant in prescribing the
nature of the forms. Within the latitude allowed by the procedural con-
sideration, alternative arrangements of the form are possible. These
must be evaluated to produce that design which will be most eco-
nomical to the entire enterprise.

COMBINING FORMS

One of the advantages which will result from a logical analysis of the
forms of an enterprise is a reduction in the number of different forms.
This comes about by redesigning slightly different forms which were
used for similar purposes and by standardizing on some clerical prac-
tices. There are obvious advantages to this procedure: lower printing
costs; uniform practices throughout the enterprise; greater flexibility
in transferring personnel and equipment from one section to another.
Moreover, sometimes a form may be eliminated by using an extra copy
of the source record, thus saving the entire clerical cost of filling out the
form, as well as eliminating the possibilities for transcription errors.

However, reduction of the number of forms is not in itself always a
profitable step. One form is not always preferable to two. In some
cases, two simple forms will perform much more economically than one
complicated form. In attempting to combine forms, one must not lose
sight of the total goal: effective service at the lowest total cost of
performance.

A convenient tool for analyzing a group of similar forms or reports

ANALYZING THE FORMS DESIGN

161

which it is believed might be consolidated into a smaller number is the
Forms Data correlation chart shown in Figure 61. The form titles and
numbers are listed along the top of the analysis sheet. All the different
data itemized on the forms are indicated in the left-hand column.
Then, whenever the data appear on a form, an "X" mark is placed in

Form or Report Names 8 Numbers

Figure 61. Forms Data Correlation Chart, an analytic tool for the prosecution
of a forms simplification program.

the box of the column headed by that form. When all the information
on each form is thus listed and checked against all the forms, this
correlation chart will point up those forms which will lend themselves
best to consolidation.

ARRANGEMENT OF DATA

The arrangement of information on forms should be in as logical a
sequence as possible. This improves the readability, intelligibility, and
usefulness of the form as well as reducing the clerical fill-in time. The
principles of motion economy discussed in the last chapter should be
applied in designing the form for economical use of space, minimum
hand travel, and easiest motion. Items should be arranged to minimize
back-tracking and searching. To reduce the work of filling in the forms,
the use of check boxes should be considered. The Printing Specifica-
tions Form, Figure 96, illustrates the use of check boxes to reduce
clerical labor.

As much as possible the information on a form should be in the same
sequence as it appears on the forms from which and to which the
information is copied. This will simplify transcription. In addition, the

162 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

sequence of information should be as similar as possible to that on
other forms used in the organization. When standard sequences and
designs are used, the clerical workers become accustomed to these
designs and work more efficiently.

Where several departments will transcribe information onto the same
form, it is advisable to group the information spaces for each depart-
ment. This will tend to save time searching for spaces and reduce
errors.

'To" and "From" boxes are advisable on forms which are sent from
person to person.

When the form consists of a letter for external use, the spacing
should be arranged to allow for the use of window envelopes to save
extra addressing time, if window envelopes are considered appropriate.

POTENTIALITY OF ERRORS

It is frequently possible to reduce the number of clerical errors by
designing the form to reduce the mental efforts of the worker. For ex-
ample, material-control forms normally provide the type of arrange-
ment shown in Figure 62 for maintaining a total or balance of previ-
ously posted items:

Date

Amount Received

Total Received

^- '

Figure 62. Typical arrangement of form for keeping a running record
of material receipts.

In filling in this kind of record, to obtain the new total the clerk must
either perform the addition of the previous total received and the latest
receipt by mentally arranging the two quantities in columnar fashion or
he must perform the operation on a machine or on a separate piece of
scratch paper. A design which the writer made of a material-control
form which simplifies the process is shown in Figure 63. Here the pre-
vious total and current quantity are arranged with all pertinent
numerals in vertical order for ready addition.

Another device, which may sometimes increase the accuracy and

ANALYZING THE FORMS DESIGN

163

SHOP ORDER STATUS RECORD

RECEIPTS

DISIURSEMENTS

=

Dot*

Tlek.t No. Amo

nt Dot*

i

TUkt No. Amo

nt Dot*

Tick.* No. Amo

unt Dot*

Tick.t No. Am

>Mt

<)-2

FT437f94

'?fe K".

Brt. Fwd.

7-/0

S36476/

? Bol.

rt. Fwd.

6-30

MfT \

? V

1

7./0

CMA

2200

S/6472 ["/

7 f?

3764/2

44-

E

7-4

DT \

7-lQ

MR.

7645Z \

^\

5fyJ 2 9

_

7-19

CMR.

^v

- $-10

AS

376412, ~ "

^S^

395756 <

500

7-ZZ

MFT

s s

636375 ~~ f

""HZ

7-29

MFT

^ ^^

5446/7 f

^^

1800

g-2

or

55?^^^

X.

S06S9 7

73^

"*~*^-^^

^x

t-7

MFT
556476 f

k-^

--'- *--.,

-ix

-- . DIVERSION

~

M

MFT

r-^sjo..

Tick*! No. (f^Jj

oi. 1600

S63I/7 2

7-5*

w*a tf-rf

6-2,

n^

<=r

XOOO

800

z ?

i

[Ffi

J

M

31 60

't

t 40

r

M 200

A

~

JO

J.

^_

f y

m

Courtesy RCA Victor and "Factory Management and Maintenance," May, 1946

Figure 63. Shop Order Status Record for controlling materials.

readability of a form as well as improve its appearance, is to shade
certain areas to set them off from the main body of the form.

VERTICAL AND HORIZONTAL SPACING

In designing a form, it is necessary to allow enough space in each
area for the maximum amount of information that will be entered, plus

164 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

a small margin of safety. As guides in determining these space require-
ments, the following information is useful.

When forms are to be filled in by hand in pencil or ink, lightweight
horizontal lines spaced three to five lines to the inch, should ordinarily
be used. Although clerical workers can write on lines spaced four or
five to the inch, it is usually desirable to have only three lines to the
inch on forms to be filled in by non-clerical workers.

When the forms are to be filled in by typewriter, horizontal lines
should not be ruled in except to provide the fill-in blanks for the in-
formation. Leaving out the horizontal ruling used on hand-filled forms
increases legibility. For single-spaced typing, six lines can be typed
per inch of vertical distance. However, it is usually preferable to use
double spacing, allowing three lines per inch.

In planning the horizontal spacing on typewriter-filled forms, twelve
spaces per inch should be allowed for elite type and ten spaces per inch
for pica type. All fill-in areas should be alined to have as few vertical
starting lines as possible, so that typing can start at relatively few
tabular stops.

Forms designed for use in connection with accounting or tabulating
machines must have spacings which conform to the machine settings
which will be used. After the design of a form has been completed, it
is desirable to make an actual test to see whether the maximum amount
of information can be comfortably placed in the allotted spaces.

HEADINGS AND INSTRUCTIONS

The headings and instructions on the form should be brief and clear.
If the instructions are too detailed, they should not be placed on the
form at all, but should be the subject of separate written instructions.
Too much detailed instruction on a form reduces its flexibility: it can-
not be used for as many different purposes; it will be obsolete sooner
when some of the details of the instructions change.

It is sometimes desirable to number the columns or spaces on a form
to facilitate the writing and understanding of detailed instructions,
which then refer to the columns or spaces by number.

FILING DATA OR SYMBOLS

Data or symbols which are used for filing or sorting the forms should
be located prominently. The upper right-hand corner is usually re-
served for these purposes, but this is not necessarily the best design in
all cases.

ANALYZING THE FORMS DESIGN 165

VISIBLE FILE

If the form is designed for use in a visible file, the visible area and
the information to be included in that area must be determined in the
initial stages of the design.

SERIAL NUMBERING

Serial or consecutive numbering is desirable when a numerical con-
trol of the forms is required. Purchase orders, inventory move tickets,
checks, and accounting requisitions are examples of forms which might
be serially numbered to promote control of the respective activities and
ready identification of any issued form. Serial numbering should only
be used when really required because of the additional printing cost it
entails.

When a form is to be serially numbered, allowance should be made
in the design for the mechanical numbering device which must be
locked in the type form if an extra press run is to be avoided. This
usually involves leaving a clear space of at least one and one half inches
horizontally and one inch vertically, ordinarily in the upper right-
hand corner.

MARGINS

The minimum allowable margins on a printed form are determined
by the space necessary for the grippers on the printing press, usually
3/16 inch or more. If the form is to be put into a binder, at least
% inch should be allowed on the left margin for the ring type and
IK inches for the post type.

For flat forms ( single copies ) to be filled in on the typewriter, it is
possible to fill in spaces down to M inch of the bottom of the sheet
although it is preferable to not go within % inch of the bottom. For
multiple copy forms, the lowest it is advisable to go is % inch.

USING BOTH SIDES OF FORM

Although it is very frequently desirable to use both sides of a form,
careful consideration should be given to the possible greater economy
of clerical handling when only one side is used. Among the factors to
be evaluated in each application are:

166 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

1. The clerical handling costs

2. The required filing spaces

3. The printing and paper costs using both sides of a form as compared
with using two one-sided forms or one larger size sheet. The paper
may have to be heavier if both sides are used because of the heavier
usage and, perhaps, the problem of transparency.

When a form is to be printed on both sides, it is usually desirable to
have it "tumbled": when the bottom of the form is turned over, the
opposite side should be right side up. If the form is to be used in a
binder or folder, however, "tumbling" would not be used.

TTELE OF FORM

The selection of the title of the form is of some importance. Good
titles will eliminate confusions when the forms are mentioned. The title
should, of course, be clear and indicate the purpose of the form. It
should, in addition, be as definitive and distinctive as possible. For
instance, the title "Personnel Record" would not be as good a title for
a record of the wage payments to laboratory personnel as "Laboratory
Pay Record."

The title is generally centered at the top of the form. Another con-
venient location for the title is the upper left-hand corner.

FORMS-CONTROL NUMBER

All forms should be numbered in accordance with the forms-control
system. This number is usually placed in the lower left-hand corner in
very small type. The forms numbering system is discussed later in con-
nection with the operation of the forms-control function in the systems
department.

COLORED PAPER

Colors can be very useful in sorting different forms. Inventory re-
ports, requisitions, and purchase orders become easy to sort when they
are different colors. Time slips can be more easily separated by weeks
when different colors are used. The various copies of a form are easily
identified by color.

Although the use of colored forms may prove useful, they must be
chosen with care or they will prove to be a liability. Two requirements

ANALYZING THE FORMS DESIGN 167

for a good colored forms scheme are: each color should have the same
definite and useful meaning all the time; there should be no more than
three to five different colors or the scheme will get too elaborate. If
these requirements cannot be met, it is usually desirable to stick to
white paper, which is cheapest. For distinguishing multiple copies of a
form, the copies can be numbered.

PERFORATIONS, CORNERS, HOLES, ETC.

When the system requires that a form be separated into two or more
parts, perforations (a series of holes) may be used to weaken the paper
so that it may be easily torn in the desired manner. Various kinds of
machines make slightly different kinds of perforations. The proper
choice depends upon the reproduction process being used and the
requirements of the procedure.

When a form will be subjected to a great deal of handling, the use of
round corners may result in fewer dog-eared specimens.

When a form is to be folded, scoring (weakening the fibers by
pressure along a line) will provide for easier and neater results.

When a form is to be inserted in a looseleaf binder, it is usually
cheaper to have the holes machine-drilled than to have each person
hand-punch the forms as they are used.

SIZES OF PAPER

To save money on paper costs, it is desirable to use paper sizes which
can be cut from the following standard sheets with no waste (dimen-
sions are in inches) :

1. 17 x 22 (can be cut from sizes 4 and 6)

2. 17 x 28

3. 19 x 24

4. 22 x 34 (can be cut from size 6)

5. 28 x 34

6. 34 x 44

Table III below indicates some of the form sizes which can be cut
from these standard sheets with no waste. From this list of sizes, as
small a variety as is practical should be chosen as standard company
sizes. The smaller the variety of sizes used, the greater the possible
economy from standardization of filing and other office equipment.

TABLE III. MOST ECONOMICAL SIZES FOR FORMS

Size of form
(in inches)

Cuts without waste
from standard sheet
measuring

Number of forms
per standard sheet

Thousands of forms
per ream (500
sheets) of
standard sheet

2%x4K

17x22

32

16

2x8

17x22

16

8

3x4K

17x28

32

16

3%x5#

17x28

24

12

3&x8

17x28

16

8

3fcxl7

17x28

8

4

4x6K

19x24

18

9

4x9K

19x24

12

6

4Kx5K

17x22

16

8

4x7

17x28

16

8

4Kxll

17x22

8

4

4Kxl4

17x28

8

4

4Kx28

17x28

4

2

4Kx6

19x24

16

8

4x8

19x24

12

6

5Kx7

17x28

12

6

5&x88

17x22

8

4

5#xl7

17x22

4

2

6x9K

19x24

8

4

7x8K

17x28

8

4

7x17

17x28

4

2

8x9^

19 x 24

6

3

8^x11

17x22

4

2

8X x 14

17x28

4

2

8^x22

17x22

2

1

8^x28

17x28

2

1

11x17

17x22

2

1

12x19

24x38

4

2

14x17

17x28

2

1

168

ANALYZING THE FORMS DESIGN 169

When designing typewriter forms wider that 8K inches, the width of
the standard typewriter carriages in use in the enterprise should be
considered.

WEIGHT AND GRADE OF PAPER

The weight and grade of paper to be used depend on a number of
factors which must be separately evaluated in all cases:

1. The amount and kind of treatment to which the form will be sub-
jected.

2. The desired appearance.

3. The method of filing the form. It is desirable for a vertically filed
record not to sag under its own weight.

4. The length of time the form is expected to be in use.

5. The number of copies to be made at one time.

6. The methods by which the information will be filled in, e.g. by
hand, by typewriter, by carbon copy, by accounting machine.

7. The properties of the different weights and grades with respect to
the above factors as well as the relative costs of the different
weights and grades.

The weight of paper or card stock, usually called its substance, is
specified as the weight in pounds of 500 sheets (one ream) of a speci-
fied sheet size. For bond and ledger paper, the specified sheet size is
17 x 22 and for post card stock it is 22& x 28M inches. The thickness of
the sheets is, of course, related to the weight or substance.

The grade of the paper is determined by a number of factors. The
highest quality and most permanent papers are made from rag stock
and the cheaper papers are made from wood pulp. However, there are
various qualities of rag stock and wood pulp and there are variations
in the manufacturing process which affect the quality. Light or
medium-weight papers of the type used in offices are usually bond
papers. Although 100 percent rag bond is the highest quality, differ-
ences between the various trade names exist. Next come the 75, 50, and
25 percent rag-content bonds which are combinations of decreasing
proportions of rag stock with wood pulp prepared by the sulphite
process. Hundred percent sulphite bond papers are graded Nos. 1
through 5 in order of decreasing quality and there are quite large
differences in the qualities of these grades.

Ledger paper is used for records which must withstand a good deal
of handling and are therefore made in heavier weights. It is otherwise
similar to bond.

170 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Manifold (including onionskin) papers are the same as bond but of
lighter weights.

Other factors which may vary are the surface finish, the opacity
(which may vary somewhat with color of paper), and the grain (which
should generally be vertical in a filed form). If the grain on a form
which is used around a roller, such as on a typewriter, runs in the same
direction as the axis of the roller, the form will have a tendency to
remain curled after passing through the roller.

It is desirable to standardize on several combinations of weights and
grades to satisfy the varying requirements. In general, the least expen-
sive which will give satisfactory service should be chosen. The paper
companies and the company printer will generally furnish samples of
the various types and grades and technical advice to aid in selecting
the most suitable papers. To aid in choosing, the papers should be
tested by using and misusing them under simulated conditions. Make
erasures on the paper and note the condition of the surface. Is it still
smooth? Write with ink over the erased area. Does the ink blur and run
down the fibres? You can also test by the sharpness of the snap or ring
of the paper when struck or bent against a desk and by the sharpness
of the edges when the paper is torn both with and against the grain.
There are many other tests which might be made depending on the
uses to which the paper will be put and the testing facilitie^available:
tensile as well as bursting strength, fading and discoloration, stiffness,
opacity, gloss, etc.

ORDERING QUANTITIES

The quantity of a form to be ordered should be decided judiciously,
keeping the following points in mind:

1. Expected monthly usage.

2. Relative costs of alternative quantities.

3. The possibility of changes in the near futurea new form, or a
drastically revised form, will more frequently require such changes.

4. With some exceptions, a year's supply is the maximum quantity of
any form that should be ordered.

It is generally desirable to adopt a very conservative attitude in de-
termining order quantities. The destruction of obsolete forms will fre-
quently more than offset the economies obtained by printing large
quantities.

ANALYZING THE FORMS DESIGN 171

PRODUCTION METHOD

Forms may be produced by letterpress, photo offset, direct plate
offset, Multigraph, Mimeograph, etc. Each of these methods of pro-
ducing forms is briefly described in the section of Chapter IX devoted
to reproducing machines.

Each of these form-production methods is best under a certain com-
bination of circumstances. Some of the factors determining the choice
of method are:

1. Purpose for which form will be used

2. Kind of form

3. Size of form

4. Grade and weight of paper

5. Quantity required

6. Quality of finished copy required

TYPE STYLE

It is frequently considered desirable to standardize on the type faces
used in letterpress work. This has the advantages of promoting uni-
formity of appearance among the enterprise's forms and of simplifying
the task of specifying type when ordering the forms. Figure 64 shows
samples of gothic type up to 18-point size. Gothic type is the most
satisfactory type for most forms because it is neat, uniform, and dis-
tinctive. It is kept by all printers and photographs very well.

THIS IS GOTHIC TYPE 6 point

This is Gothic Type 8 pomf

THIS IS GOTHIC TYPE 10 point

This is Gothic type 12 point

THIS IS GOTHIC TYPE 14 point

This is Gothic type 18 point

Figure 64. Gothic type will give good uniform results for most form
requirements.

Reverse printing (white letters against a patch of dark background)
is sometimes desirable to attract attention to an important detail.

Padded-

Fig. 65

vbon

Gr/pper-
f ~-* Perforations L

Carbon (fastened
to gripper)

Fig. 66

" Carbon (fastened to grip per)

Fig. 67

Figure 65. Interleaved carbon forms eliminate carbon insertions by typist.
Figure 66. Single-stub snap-out form facilitates separating the copies.
Figure 67. Single-stub snap-out form may have perforation in corner.

172

ANALYZING THE FORMS DESIGN 173

CONSULT PRINTERS AND MANUFACTURERS

In the determination of the best methods of designing and producing
forms, printers and manufacturers should be consulted freely. They can
frequently offer valuable advice and guidance which will give better
results at lower cost. In addition, it is usually very desirable to conduct
actual tests of papers and carbons before placing large orders. This is
especially true when exceptional legibility, a large number of copies,
or unusual wearing qualities are required.

KINDS OF FORMS

Most forms consist of single sheets of paper, sometimes arranged in
pads. These forms, consisting of only one part, are commonly known
as flat forms. Flat forms are the simplest arrangement and are the
cheapest to produce. Various improved arrangements of sets of multi-
copy forms are possible and are described here.

Although they are more expensive to produce, many of these arrange-
ments save many times the additional production cost in reduced cleri-
cal cost and more accurately prepared forms. Inserting and removing
carbons in multicopy forms; positioning the forms into alinement; the
inserting into and removing from the typewriter of each form; alining
each form in the typewriterthese are some of the steps which can be
eliminated by specially arranged forms, some of which are described
below. More accurate registration on copies is another advantage asso-
ciated with these arrangements.

1. Collated forms. Multiple copy forms which are padded and ar-
ranged in sets according to color of paper, color of ink, or num-
bered copies.

2. Interleaved carbon forms. Same as collated forms, with the addi-
tion of carbon paper padded between the copies of each set. Con-
struction is shown in Figure 65.

3. Snap-out forms. Each set of forms has carbons inserted between
copies, with forms and carbons held in place by a stub. In both
the single- and double-stub sets, the forms are perforated along
the gripper stubs. In the single-stub variety, shown in Figures 66
and 67, the carbons are all attached to the gripper and are short of
the edge of the form opposite the gripper. By pulling the gripper,
and holding the sheets of the form at the edge which is carbonless,
all carbons can be removed in one motion. In the double-stub
variety, shown in Figure 68, each gripper is removable separately.

Perforations

Grippes

Gripper-

Fig. 68

Carbon (fastened
to t top g ripper)

'Carbon (fastened
to boftom gripper

Fig. 69

Fig. 70

Figure 68. Double-stub snap-out form permits removal of specified copies

while retaining remaining copies intact for further transcription.

Figure 69. The continuous construction of these snap-out forms is useful in

machine work where separate manual insertions are eliminated.

Figure 70. Continuous-strip form, no interleaved carbon.

174

ANALYZING THE FORMS DESIGN 175

By having some of the carbons attached to different grippers, some
of the carbons may be retained after others have been removed.
Information can then be added to those copies with the retained
carbons.

4. Continuous-strip forms. Each set of identical forms is joined by
perforations at top and bottom with the preceding and following
set. Continuous-strip forms may or may not have interleaved car-
bons. The principal advantage of continuous-strip construction is
that it eliminates the necessity of separately inserting the form in
a typewriter or other machine each time a form is to be completed.
Using continuous forms with mechanical attachments, rapid feed-
ing, alining, and positioning of forms can be obtained.

The single-stub snap-out continuous-strip form, shown in Fig-
ure 69, is the same as the single-stub snap-out form except that the
bottom copy of each set is joined to the following set by perfora-
tions. Some of the information can thus be entered while the form
is continuous, then the separated form remains intact with inter-
leaved carbons for further entries and snap-out of the carbons.
The continuous-strip form shown in Figure 70 is perforated at
the folds, but does not have carbons interleaving. This type of
form is commonly used on a standard typewriter with a "floating
carbon" device which feeds continuous carbons between the con-
tinuous-strip forms.

The continuous-strip form with single marginal punching, Fig-
ure 71, and double marginal punching, Figure 72, are used with a
mechanical device attached to the typewriter or other machine and
containing rotating teeth which aline the copies for more accurate
positioning.

Although not shown in the illustrations, the continuous-strip
forms shown above also come with interleaved carbons.

When it is important to insure an untampered copy of a form,
continuous-strip forms with marginal punching are very useful in
connection with special equipment (see page 211) which automati-
cally retains a proof copy which cannot be altered.

5. Fanfold forms. The individual parts of each set are connected at
the sides by a fanfold or accordion arrangement and at top and
bottom as in continuous forms. All edges are perforated and the
forms may or may not have interleaved carbons. The construction
is shown in Figures 73 and 74. A set or part of a set may be sepa-
rated from the continuous strip and it will still hold together, with
carbons in place, because the forms are joined at the sides.

Marginal Punching

Fig. 71

Fig. 72

Figure 71. Continuous-strip form with single marginal punch-
ing such as is used in connection with various mechanical
devices.

Figure 72. Continuous-strip form with double marginal
punching.

176

ANALYZING THE FORMS DESIGN 177

6. Carbons. When multicopy forms are being used, carbons may or
may not be interleaved. When non-interleaved continuous-strip
forms are used, one of a number of devices may be used on the
typewriter to save on carbon costs. Interleaved carbons may be
desirable in forms which are to be handwritten to save the time of
setting up carbons, in typewritten forms which will require sub-
sequent entries, in certain types of writing machines, as well as
other situations. The carbons should always be chosen with care,
especially when a relatively large number of legible copies are
required. There are many different types and grades of carbons
designed for different usages typewriting, handwriting, and vari-
ous types of office machines to choose from.

7. Uncoated or cut carbons. When it is desired to withhold informa-
tion from one or more copies of a form, certain areas of selected
carbons may be uncoated or may be die cut to eliminate the carbon
in the spaces where reproduction is not wanted.

8. Block-out areas. By blocking an area with solid ink, the visibility
of a carbon imprint is eliminated for most purposes. Where ap-
plicable, this procedure is cheaper than the uncoated or cut-carbon
techniques.

9. Carbon-coated backs. The backs of forms may be carbon-coated to
eliminate the necessity for carbon sheets. This practice must be
used with caution, because carbon tends to smear on the hands of
the persons handling forms and may become very messy. How-
ever, when only one or two small areas are to be copied, a satis-
factory practice is to spot carbon, placing the carbon only over the
required areas.

10. Sets with different widths or lengths of copies. These can be used
to keep off information not desired on certain copies.

11. Various size carbons. These can sometimes be used in one set of
forms to keep certain information from one or more copies.

12. Uncoated-edge carbon. Another device to avoid transferring in-
formation to one or more copies of a snap-out form set. The edge
of one or more of the carbons in the snap-out form protrudes be-
yond the forms and is uncoated. When pulled out, the remaining
forms and carbons are left intact for further entries.

13. Duplicating master form. Used when more copies are required
than can be produced by carbon copies. The form is printed on
one side of a sheet of master paper to which a sheet of duplicating
carbon is attached. The carbonized surface faces the reverse side
of the master paper. When the form is printed on the master paper,

Fig. 73

Carbon

Fig. 74

Figure 73. Fanfold forms, no interleaved carbon.
Figure 74. Fanfold form, with interleaved carbons.

178

ANALYZING THE FORMS DESIGN 179

a negative carbonized impression is produced on the reverse side.
Pending use of the duplicating master form, a tissue sheet is
usually placed between the carbon and the master paper. When
the form is used, the tissue sheet is removed and the pressure of
the pencil, typewriter, or other machine will fill in the spaces on
the form and cause the duplicating carbon to create an impression
on the reverse side. The completed form is then duplicated by a
spirit duplicating machine as described in Chapter IX.

The duplicating master form may also provide flexibility in adding
and removing information. Partial data may be placed in the master
form and copies run off. Then additional information can be added and
more copies reproduced. Or, information may be withheld from certain
copies by covering any of the carbonized impressions with tape.

Because the specially arranged forms just described are more expen-
sive to produce than simple flat forms, careful analysis should be made
before ordering them. Detailed estimates should be compiled of the
time saved by their use. In general, only if the cost of this saved labor
compensates for the extra cost of the specially arranged forms is it
desirable to use them.

FORMS-CONTROL SYSTEM

To insure that the advantages of good forms design are applied on a
systematic basis to all the forms used in the enterprise, a forms-control
system should be instituted. The full benefits of good forms design and
standardization cannot be obtained without a vigorous forms-control
program to insure universal and uniform treatment of all the forms in
the enterprise. The essential characteristics of such a program are de-
scribed in a later chapter, where the performance of the various func-
tions of a systems department is discussed in some detail.

ANALYZING THE FORMSA CHECK LIST

Proposed and existing forms should be analyzed in accordance with
all the principles which have been discussed. Each item must be con-
sidered separately or important design considerations will be over-
looked. To aid in assuring complete analysis, a forms-design check list
should be used in connection with each form. The check list should
ask questions which will tend to make possible improvements more
evident.

180 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

A check list, such as the following, should be consulted in connection
with the analysis of each form:

I GENERAL USE

1. What are the purposes of the form?
Are the purposes necessary?

Does the form completely accomplish its purposes?

2. Can some other form be used for this purpose?

3. Can this form be combined with some other form?

4. Should the form be divided into separate forms?

5. Are all necessary copies included?

6. Are all copies necessary?

7. Does the title indicate the use of the form?

8. Is the title distinctive?

II CONTENT

9. Has the form-control number been included?

10. Are all recurring data printed?

11. Have spaces been left for required dates?

12. For forms to be transmitted, should spaces be provided for "to"

and "from" information?

13. Has required space for signatures and approvals been included?

14. Should simple routing or handling instructions be printed on the

form?

15. Is serial numbering desirable?

16. Are all included items necessary?

17. Are all necessary items included?

III ARRANGEMENT

18. Have adequate spacing and margin standards been used?

19. Has it been tested for proper spacing?

20. Are the most important data in the most prominent locations?

21. Should both sides of form be used?

22. Are data required for filing and sorting prominently located?

23. Is spacing sequence logical (minimum hand travel and easiest

motions)?

24. Is sequence of items same as on forms from which and to which

information is transcribed?

25. Is sequence of items the same as used on similar forms?

26. If it is to be mailed outside, should form be designed for win-
dow envelope?

IV SOURCES OF INFORMATION

27. Have aU users and potential users been consulted for suggestions?

ANALYZING THE FORMS DESIGN 181

28. Have the persons responsible for the system been consulted for

suggestions and approvals (supervisors, systems men, etc.)?

V PAPER AND PRINTING

29. Is the size standard?

30. Are the grades and weights standard and correct for usage,

expected life, filing, and handling?

31. Has colored paper been considered?

32. Have all other required items been accurately specified on

printing request e.g., size of order, method of printing, ink,
holes for binders and special machines, collating requirements,
carbon requirements, etc.)?

REPORTS AND CHARTS

Reports and charts are forms which should be subject to the same
kind of analysis as all other forms in the enterprise. Figures 12 and 13
in Chapter IV show suggested methods for gathering data. Reports,
graphs, and charts of all kinds should be organized as efficient instru-
ments for providing management with all the facts it requires for con-
trolling operations and making policy decisions. Some essential ques-
tions in examining the reporting system of the enterprise are:

1. Are the various reports coordinated with each other no unneces-
sary overlap and complete coverage of all essentials?

2. Are they issued at the right times so that action can be taken
before things go wrong or, next best, while they are happening
rather than after they have happened?

3. Do they read easily at a glance?

4. Do they compare performance with standards highlight things
which are not as they should be?

5. Do the reports summarize important facts or do they present rela-
tively unimportant details; or opinions where facts are available?

EXAMPLES OF IMPROVED FORMS DESIGNS

A few examples of how forms design can simplify operations are
presented here pictorially. How the four sets of forms used in the Per-
sonnel Department of the Edward G. Budd Manufacturing Company
were changed to two sets is shown in Figures 75 and 76. How
R. H. Macy's uses a form to save the typing of a letter when sending
a refund check to a customer is shown in Figure 77. How the forms
were redesigned to simplify the receiving-inspection system at the
Hartford-Empire Company is shown in Figures 78 and 79. The old and

182 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

BEFORE

Courtesy Moore Business Forma,

Figure 75. The personnel department of the Edward G. Budd Manufactur
individual typing operations. Two simple forms (Figure 76) with inter
have to be filled out for new employees are combined in one set and the form
in another set. The number of separate typing operations required in the case

new systems story of receiving and inspection at the Hartford-Empire
Company is described below:

THE OLD SYSTEM:

A copy of the Purchase Order and two copies of the Requisition are sent
to the Receiving Department usually before material is received. But fre-
quently delays occur in sending these to receiving. When material is received

ANALYZING THE FORMS DESIGN

183

AFTER

Inc. and The Budd Company

ing Company were using the above four sets of forms. This meant four
leaved carbon sets were substituted for the four forms. All the forms that
that is necessary for a transfer of an old employee to a new department is
of a new employee is reduced from three to one.

first, confusion, misplaced materials and loss of control result. Lack of provi-
sion for recording and rerouting of materials delivered in error to the wrong
building frequently caused delays in production and shipping.

Receipt of material is recorded on the Purchase Order and each copy of
the Requisition, a total of three times.

A more complete record of each receival is made on the "Daily Report of
Goods Received," a chronological list of each item. One copy was circulated

184

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

PLEASE NOTE

The enclosed check was issued as our refund for the merchandise you recently
returned. If you requested an exchange of merchandise, we were unable to
carry out your instructions.

If the salescheclc was not returned with the merchandise, the refund was
issued at the current selling price. Cut lengths of material over two yards
(three yards for upholstery fabrics) are acceptable for refund at 25% less
than the purchase price.

JvlawA

F 463 1 A 5-50

Courtesy Macy's New York

oc/u/teoy iK[tttif a ^vou/ j. i/n

Figure 77. This Macy's form eliminates the necessity for typing of a letter
when issuing a refund.

Courtesy Standard Register Company of Dayton, Ohio, and the Hartford-Empire Company

Figure 78. The old forms situation in the receiving-inspection system at the
Hartford-Empire Company.

ANALYZING THE FORMS DESIGN

185

to the head of every department which had requisitioned one or more of the
materials recorded on the sheet. This caused delay in advising the various
departments and loss of time by each department in searching the entire
sheet to find the items they were concerned with on the sheet.

When material required inspection, an Inspection Report (original only)
was written, then posted to a log book. The report went either to the shop or
Inspection file. The only complete record of inspections was the log book in
chronological order which made reference difficult.

When a partial shipment was received, a 3-part Receiving Report was
written and the item entered on the "Daily Report of Goods Received/*

Two copies of the Report went to Purchasing. One of these with the ap-
proved invoice attached went to Accounting. The third copy traveled with
the material.

THE NEW SYSTEM:

A combined receiving-inspection form was designed for both complete and
partial receivings. All information required by any interested department was

Figure 79. The new forms situation at the Hartford-Empire Company after
analysis of the receiving-inspection system.

186 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

included in the form. This eliminated delays formerly encountered in search-
ing for additional information, particularly in the Accounting Department.

Sufficient copies were provided so that from a single writing everybody
interested in both materials received and the result of the inspection would
be notified. This eliminates the need for rewriting all or part of the informa-
tion several times.

The inspection set was designed with three copies, one of which identified
the material and required inspection information before the use or showing
of the material identified. A second copy gave the inspection department a
complete record of materials inspected. The third copy assured delivery of
the information required for inventory control.

Two copies refold in a locked compartment to be delivered later to the
requisitioner and Accounting Department assuring both of complete, accurate
copies of all receiving records.

A three-part Receiving Report, identical in design, provided control for
materials delivered to the wrong building. The first copy is used to advise the
purchasing department, the second to identify the material to the proper
building for receiving, the third is a record of materials transferred to the
other building.

TYPES OF SAVINGS

It is desirable to keep in mind the three areas where-cost savings
may be made by effective forms design:

1. The cost of the form

2. The cost of filling in the form

3. The cost of operating the system with the form

The potential savings in each of these three areas will vary from
enterprise to enterprise. Moreover, in some cases, a saving in one
category must be sacrificed to enable a saving in another. For exam-
ple, by spending a little more on the production of a form, it might be
possible to save quite a bit on the cost of filling in the form. In these
cases, the magnitude of the possible savings will determine which
alternative will be adopted.

In evaluating the possibilities of savings in each of these areas, it
is worthwhile to consider the relative amount of money represented by
these costs. It is pretty safe to say that in most companies the cost of
filling in the forms is very large as compared with the cost of the forms
and that the cost of the operating systems is very large as compared
with the cost of filling in the forms. For this reason, the logical approach
in designing a form is to give first consideration to the requirements

ANALYZING THE FORMS DESIGN 187

of the system; then consider reducing the clerical cost to a minimum;
and finally save as much as practical on the paper and printing costs.
In all cases, alternative costs must be accurately evaluated: will a $100
saving in one area be made at the sacrifice of more than $100 in
another area?

IX

ANALYZING MACHINE UTILIZATION

F NE OF THE OUTSTAND-
ing features of modern industrial enterprise is the great economy in
the production of goods and services which has been effected through
the use of labor-saving machinery and equipment. During the earlier
stages of the development of our present mechanized economy, the
use of labor-saving devices was largely confined to direct-labor fac-
tory operations. With increased specialization of functions in most
enterprises, the importance of costs of the service and coordinating
activities of the enterprise which are performed in offices has in-
creased. Properly to administer the huge business organizations, top
management requires much larger amounts of statistical and other
control information. The cost of these indirect service activities may
now exceed the cost of the direct productive activities.

As a result of this rather recently acquired added importance and
cost, more and more emphasis is being placed on the design and
development of labor-saving equipment for the office and on the
correct utilization of this equipment. In this chapter, we will discuss
some of the methods for promoting the best utilization of office equip-

188

ANALYZING THE MACHINE UTILIZATION 189

ment. We will also outline the principal kinds of equipment which
might be of use for promoting the operation of procedures.

Can you perform systems activities without furniture and equip-
ment? The answer to the question is the same as the answer to the
question: Can you manufacture a product without machinery? Ob-
viously, no.

However, you can manufacture a product using hand tools rather
than power-driven automatic machinery. Your production costs will be
very high if you do and, before long, you will find that your costs are
not competitive with the other members of your industry.

Similarly, you can perform your systems operations with the crudest
kind of equipment. However, the results of your backward policy may
be very high overhead costs which inflate product cost.

It therefore behooves the systems analyst to be certain that he has,
wherever possible, considered the use and economy of all possible
labor-saving equipment for the performance of the clerical activities
in his procedure. The obtaining of facts on machine utilization was
discussed and illustrated in Chapter IV. We will outline in this chapter
some of the principal types of equipment used for the performance
of clerical operations. This outline cannot disclose the places where
practical economical application is possible. The possibility and ad-
visability of applications vary from enterprise to enterprise. Only a
thorough knowledge and study of the systems requirements and de-
tailed study of the relative economy of operation will disclose the best
areas for application.

POSSIBLE ADVANTAGES FROM THE USE OF EQUIPMENT

Some specific advantages will accrue when maximum advantage is
taken of possible savings through the use of mechanical devices.

1. Clerical labor may be reduced. This will frequently more than pay
for the machine cost in a short time.

2. Machine transcription of work is usually more legible, neater, and
more accurate.

3. The simplification and standardization of the work which is fre-
quently made economically possible by the machine may permit
the employment of less skilled and less expensive office help.

4. Reports and statistical information for control and coordinating
purposes can often be made available more frequently, more
currently, and at lower cost as a result of the use of office machines.

190 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

5. Properly chosen equipment may save space (fewer people required
and less equipment space), and permit improved lay-out.

STANDARDIZATION OF EQUIPMENT

Some degree of standardization on particular makes and kinds of
office equipment is usually advisable. Carefully chosen standards
should promote efficient use of equipment which is well suited to the
enterprise's needs.

Standardization provides for increased flexibility in the use of both
equipment and personnel. It may thus reduce the total amount of
equipment needed because the units are interchangeable between de-
partments. Standardization allows for easy transfer of personnel from
one department to another, with no loss of time to learn how to operate
the equipment. It may thus also reduce the number of required per-
sonnel because of this ability to shift them so readily to handle peak
loads.

In addition, maintenance and repair costs will probably be lower
with fewer different models. Price savings may be possible because of
the purchase of large quantities of equipment and supplies from one
company.

Standardization, however, should not be allowed to stand in the way
of using the best-suited equipment for each job. Whereas it would be
very nice to standardize on one size of file, if different requirements
call for different sizes, it would not be economical to prescribe the use
of letter-size files at all times. In this case, two or more standard sizes
should be adopted.

SYNCHRONIZING PERSONNEL AND EQUIPMENT

To use office equipment and personnel to maximum effectiveness, it
is necessary to balance the time of both equipment and personnel.
When the personnel must wait for the machine a portion of the time,
valuable labor is wasted. When the machine is idle a portion of the
time, rental or depreciation charges accrue. Perfect synchronization
of the personnel and machines is therefore the desirable objective.

When perfect synchronization cannot be obtained, it is necessary to
compromise in favor of maximum utilization of either the personnel or
the equipment. When the hourly personnel cost is greater than the
hourly machine cost, the compromise will favor personnel utilization.
In some cases, where the equipment cost is great in comparison with

ANALYZING THE MACHINE UTILIZATION 191

the labor cost, maximum utilization of the machine will be the more
important goal.

In analyzing the work of jobs involving the concurrent performance
of personnel and equipment, a Multiple Activity Process Chart is
frequently very valuable. In these problems, time is the important
coordinating element. The Multiple Activity Process Chart permits the
analysis of the details which are performed both simultaneously and
alternately by one or more persons and/or one or more machines.

To construct a Multiple Activity Process Chart, it is first necessary
to establish the average times for the various details or elements of
the personnel and equipment activity. This may be done by observa-
tion with a stopwatch, from standard time study data, and/or by
determining the operating speeds of the equipment. ( See Chapter VII. )

Having determined the sequence and time for all the elements of
both persons and machines, the construction of the chart consists of
alining the elements of the activity of each person and machine on
the basis of time of occurrence.

In Figure 80 is shown a Multiple Activity Chart of one autotype
operator and two autotype machines. The autotype machine is briefly
described on page 201. The charted job consists of manually typing the
date, name, address, and salutation of a form letter, and then leaving
the copy in the machine for the body of the letter to be automatically
typed. Since a pamphlet is sent under separate cover at the same time
that the form letter is mailed, two envelopes must be addressed for
each form letter.

The elements of the activity are indicated in the left-hand portion
of the chart. In the first right-hand column (1) is charted the op-
erator's activities; in the second column (2) and the third column (3)
are indicated the activities of the respective machines. The graduations
of the time scale are placed to the right of the third column ( 3 ) . When
any person or machine is idle, the column is cross-hatched. This chart
shows that the operator was working only 49 per cent of the time and
was idle 51 per cent of the time. The machines, however, were active
95 per cent of the time, idling only 5 per cent. Since the hourly operator
cost is materially greater than the hourly machine cost, this personnel
utilization ratio was not good.

To improve this situation, it is necessary to obtain some other
activity for the operator while she is waiting for the form letter to be
completed automatically. Some other person is presently typing the
two envelopes required for each form letter. By assigning a surplus
standard typewriter to the operator, she can address all the required

GENERAL FOODS CORPORATION

*

&

MULTIPLE ACTIVITY PROCESS CHART

$

? '

* i

f

OPERATION Auto -Type Operator

^>

\ OHATION Typing Service

V

^

OATF 4/25/48

(1)

(2)

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f?sf[j@i/f fQrfft ffQfi} fttQC/iins "A" .OS

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Install blank form in machine "A " JO

w,

-

Type \

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Date

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Name

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Address

Salutation K ~

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Turn to machine "B" .JS

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Remove form from machine "0" .OS

' / / s

Install blank form in machine "B" JO

///;

-

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Type

Date

1.2

Name

Address

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Salutation ~Q

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Turn to machine "A" JS

'' 1.6

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i

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1.2.2

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i

12.4

L2.6

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1.2.8

1.65

1.3.2

L3.4

[ 3.6

Courtesy General Foods Corporation

Figure 80. Multiple Activity Process Chart relates graphically the time
cycles of the operator and the two autotype machines she operates.

192

GENERAL FOODS CORPORATION

MULTIPLE ACTIVITY PROCESS CHAR!

OPERATION Auto -Type Operator

r
j8

t *
$

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LOCATION Typing Service

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DATE 4/25/48

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Install blank form in machine "A" JO

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Type
Dale
Name
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Salutation 50

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Remove form from machine M B H .05

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Install blank form in machine "B" JO

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Type
Date
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Turn to machine "C" JS

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, Address
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Address
Remove
Envelope .36

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Courtesy General Foods Corporation

Figure SI. By analysis of the operation shown in Figure 80, the new
improved synchronization was developed as shown in this chart.

193

194 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

envelopes during her idle time. The low utilization (28 per cent) of the
typewriter is not significant because its hourly cost is negligible. The
improved procedure is shown in Figure 81.

If two envelopes per form were not required in the example just
cited, it might have been advisable to assign two more autotype
machines to her. This would also have doubled her productivity.

APPLICATION OF MOTION-ECONOMY PRINCIPLES

In the design and construction of office equipment for the general
and special tasks of the office, the principles of motion economy ex-
plained in Chapter VII should be applied. Principle No. 6 states that
the hands should be relieved of all work which can be performed by
other parts of the body. Whenever possible the machines should there-
fore make use of foot-activated mechanisms or other devices which do
not require use of the hands.

Principle No. 5 says that the inherent abilities of the various parts
of the human body should be considered. As an example, a well-
designed typewriter keyboard would take the inherent abilities of the
various fingers of each hand into account. This would be done by:

1. Determining the average relative strengths and capacities of each
of the fingers of the right and left hands,

2. Determining the frequencies and sequences of occurrence of the
various letters of the alphabet, numerals, punctuation marks, capi-
tal letters, etc. in ordinary usage.

3. Assigning positions on the keyboard so that

a. The relative frequency of striking the keys will correspond
to the relative strengths of the fingers.

b. The most usual sequences of strokes will provide simple, bal-
anced motion patterns.

The Dvorak-Dealey Simplified Typewriter Keyboard was designed
with these principles in mind.* Among the advantages claimed for this
scientifically designed keyboard are:

1. The keyboard simplifies the finger stroking, makes for better bal-
ance between the hands, and aids rhythm and timing. This enables
the typist to do the work with greater ease and to increase the
amount of work produced.

* August Dvorak and others, Typewriting Behavior, Psychology Applied to Teach-
ing and Learning Typewriting. New York, American Book Co., 1936.

ANALYZING THE MACHINE UTILIZATION

195

2. Fatigue is reduced because more work is done with the stronger
right hand and less with the weaker left hand.

3. Student progress on the new keyboard is twice to three times as
rapid as on the old keyboard.

ANALYSIS OF FILES AND FILING METHODS

Most systems operations and communications are performed on
papers and forms. A good proportion of these are eventually filed.
Analyzing the files and filing methods in the office therefore constitutes
an important aspect of the work of reducing operating costs.

ANALYSIS OF RECORD USAGE

AVERAGE TIMES USED PER DAY

Df>pf Sect Date

Employee

Name of Record and Filing Equipment

f *S***~*^,-^,-,_iA l _ f -^r-,^* "" *~^^

'"i

.^- '

r"*~*"

p-x.

N

^ *

^

L 1

' J

"N^.

/

^

P*-<N|

Total Avg. Daily Usage

* s.

f

No. ofEmpkyees Using

Figure 82. Analysis of Record Usage provides data for implementing a
files analysis program.

If duplicate copies are filed; if active and dead records are inter-
mingled; if old useless records are retained indefinitely; if the indexing
systems are incorrect and/or not uniformly followed; if the most suit-
ably designed equipment is not used; if these or other poor filing
practices are followed, the enterprise may be burdened with unneces-
sary expenses.

What are some of the kinds of information required for systematic
analysis of filing procedures?

1. Nature of materials filed

2. Purpose of filing the materials

3. Magnitude of advantages from visible indexing

4. Indexing methods

5. Sizes of materials

196 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

6. Quantities of materials filed

7. Any fastening methods used

8. Number of references made to materials. A sample form for tab-
ulating this file usage information is suggested in Figure 82.

9. Nature of references, i.e. for posting, obtaining information, etc.

10. Period of active usage of materials

11. Requirements for retaining inactive materials

12. Procedure for removing inactive materials to inactive and/or dead
files

13. Persons who have access to file

14. Methods of charging out materials

15. Time spent by various personnel in maintaining files

16. Kinds of equipment used

17. Usage of equipment proper labeling of drawers, use of guides,
balanced distribution of material, etc.

ANALYSIS OF REPRODUCTION EQUIPMENT

Use of the most suitable reproduction methods plays a significant
part in the development of successful, low-cost clerical procedures.
Thorough and careful analysis of the currently used methods will fre-
quently pay large dividends in savings and improvements. As described
later in this chapter, there is a wide range of methods of producing and
reproducing systems information. The chart on page 210 suggests some
of the more desirable alternatives for the more usual kinds of duplicat-
ing work. The following list summarizes the various types of equipment
which are mentioned in this chapter.

1. Pencils of varying hardnesses

2. Inks of varying permanence

3. Stamps

4. Typewriter, including electric, automatic, billing, Vari-Type and
Teletype.

5. Tape adding and calculating machines

6. Bookkeeping and accounting machines (including punched card)

7. Addressing machines

8. Microfilming equipment

9. Recording or dictating machines

10. Letterpress printing

11. Lithograph or planograph printers (including offset)

12. Rotary relief duplicators such as the Multigraph machine

ANALYZING THE MACHINE UTILIZATION 197

13. Stencil process duplicators such as the Mimeograph machine

14. Hectograph process machines

15. Contact and projection photocopy machines

16. Facsimile equipment

17. Telautograph machine.

EQUIPMENT-CONTROL PROCEDURE

To promote the proper selection, procurement, standardization,
usage, and maintenance of office equipment so as to provide the maxi-
mum benefit to the enterprise, an equipment-control procedure should
be established. The essential aspects of such a procedure are discussed
in a later chapter covering the operation of the systems functions.

SOURCES OF INFORMATION

New developments and inventions in the field of office-machine de-
sign and construction are constantly occurring. Many of these inno-
vations will furnish the basis for improving office services at lower costs.
To keep up with these developments, the systems analyst should be
alert for announcements in the office-management literature which he
should read regularly. He should contact the companies manufacturing
the kinds of equipment which might prove useful in the enterprise.
The office-equipment companies will usually send literature and sales-
men to describe their products to any interested person. The analyst
should attend the annual business shows which feature displays of the
newest refinements in office machinery.

DEMONSTRATIONS

Before purchasing a new machine, it is advisable to have a demon-
stration of its application to the actual work. In many cases, trial in-
stallations can be arranged. In this way, much can be learned about
the machine and its possibilities for a particular application in advance
of committing large sums of money.

EQUIPMENT DECISION BASED ON ECONOMY STUDIES

It is essential that the decision to install or to reject a piece of office
equipment be made only after a detailed systems and economy study.
Some of the principles and possible pitfalls inherent in such a study

198 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

will be outlined in the next chapter. Among the factors to be investi-
gated are the following:

1. Changes in systems and forms which will be required by the
machine

2. Required machine capacity

3. Machine speed

4. Machine maintenance costs

5. Machine life

6. Machine purchase costs

7. Material and labor costs using the machine

8. Material and labor costs using the present methods

9. Any alternative machines or methods which might be used.

OFFICE EQUIPMENT

It is impractical and undesirable to attempt to describe here in any
detail the large number of different types and makes of office equip-
ment which might be useful to the systems analyst. It would be im-
possible in one volume to describe completely the myriad types of
equipment. Moreover, the detailed descriptions would be incomplete
and outdated within a relatively short time because of the constant
stream of improvements and new developments. However, an attempt
will be made briefly to survey the available types of office equipment,
pointing out here and there possible uses and advantages.

DESKS, TABLES, AND CHAIRS

The desk is one of the most common pieces of office equipment.
Many special designs of desks for special purposes have been made.
Some of these designs have improved the utility and efficiency by a
careful consideration of the motion economy of the worker.

The determination of the best type of desk for each enterprise will
vary, depending on the nature of the business and the methods of
operation. Some generally applicable considerations are mentioned
here.

The principal types of standard desks are the double-pedestal
executive desk (36 or 38 by 66 inches), which is a larger, more elabo-
rate version of the double-pedestal clerical desk (36 by 60 inches);
the single-pedestal clerical desk ( 30 by 42 inches ) ; the double-pedestal
secretarial desk (36 by 60 inches); the double-pedestal (32 by 55
inches) and single-pedestal (30 by 42 inches) typewriter desks.

ANALYZING THE MACHINE UTILIZATION 199

For clerical work, the double-pedestal or single-pedestal flat-top
desk is commonly used. The single-pedestal is preferable when, as is
usually the case, the added storage space in the double-pedestal desk
is not necessary. The smaller desk allows greater flexibility and work
flow in office lay-out planning and conserves floor space. To illustrate
the space saving in using single- as against double-pedestal desks,
consider that at least 2/2 feet must be allowed behind each desk for the
chair and worker to move around. The total floor area taken by the
double-pedestal desk is thus 27/2 (5 by 5M) square feet as compared
with 17/2 (3/2 by 5) square feet by the single-pedestal desk. This saving
of 10 square feet per desk can be converted into dollars per year by
multiplying by the annual square-foot rental charge.

For the full-time typist, the double- or single-pedestal typist's desk
provides a comfortable work place. However, for the person who
divides her time between typing and clerical work, such as a private
secretary, it is usually convenient to use a secretarial desk in which
the typewriter is at the left- or right-hand side of the desk and the
entire desk top is available for clerical work.

When drawer storage space is not required, it is preferable to use
a table rather than a desk. Tables are cheaper than desks. Lacking large
storage capacity, tables discourage the accumulation or hoarding of
unrequired material in the drawers. They may thus promote neatness
and efficiency. The table sizes should usually correspond with the
standard desk sizes.

Chairs of proper height and construction should be provided for all
categories of workers. These chairs executive-type swivel chairs, sten-
ographic chairs, straight-back chairs should all provide proper body
support and comfort. They should promote proper sitting posture to
reduce fatigue to a minimum.

In considering whether to use wood or steel furniture, what colors
will be selected, what sizes and styles will be established as standards,
many factors, such as appearance, durability, utility, maintenance,
cost, etc., must be carefully evaluated.

FILES

Files for the office may generally be procured in wood or steel. Steel
files have been accepted as generally preferable by a large number of
offices and are standard equipment in most companies. Steel files take
wear and tear better, are more serviceable, and do not burn. However,
because of the insulating quality of wood, a wood file affords greater

200 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

heat protection to its paper contents in case of a fire which does not
reach the cabinet.

Vertical letter- and legal-size files come in one-, two-, three-, four-,
and five-drawer units. The four-drawer unit is the most usual standard.
The five-drawer type is more economical in so far as first cost and
floor space usage are concerned. However, special stools must be used
unless only girls of above average height are employed. The three-
drawer type can be arranged to serve as a counter and is especially
valuable when the filed information is required to answer the queries
of persons calling at the office.

Visible-file equipment is made in a very large variety of styles. Only
some of these will be mentioned here. Because of extra space and rela-
tively high initial and operating costs which this equipment sometimes
requires, careful analysis of the possible alternatives should be made
before a decision is reached to convert to visible file equipment. For
many applications, involving frequently used records, correctly chosen
visible-file equipment will save time and over-all operating expenses.

Drawer-type visible index files are constructed to have the over-
lapping margins of the cards visible. The visible portion of each card
makes for ease in location of the cards as well as providing a means for
incorporating a graphic signaling system on the cards. Both sides of a
card may be used. Other visible index file systems are made in which
the file cards are attached to vertical swinging panels or are filed into
specially prepared binders.

Various types of vertical and horizontal rotary files are made. These
files have a relatively large capacity and may save time in locating and
positioning cards for posting operations. The horizontal variety may
prove especially valuable when several persons must work simultane-
ously with a large volume of records.

MICROFILMING EQUIPMENT

To economize in storage space, many companies have found it de-
sirable to microfilm certain categories of documents, which are then
destroyed. Various types of equipment are available for this purpose.

TYPEWRITERS

Standard office typewriters come in various models. The principal
sources of variation are the size of the type (elite and pica are usual
sizes), size of carriage or bed, manual versus electric-power-driven
operation, and cylinder versus flat-bed type.

ANALYZING THE MACHINE UTILIZATION 201

The size of the carriage or bed determines the maximum size of sheet
which can be used. The principal advantage of the electric-driven
typewriter over the regular manual variety is the more even pressure,
resulting in better copy, reduced typist fatigue, greater number of
legible carbons, and higher possible typing speeds. The flat-bed type-
writer is valuable when typing on sheets of heavy stock which cannot
be bent around a typewriter cylinder.

A special typewriting machine which is well adapted for preparing
master copy for reproduction is known as the Vari-Type machine.
This machine, having standard letter keyboard, has the following two
features which are valuable in the preparation of forms, manuals, in-
structions, for offset printing as well as many other duplicating methods:

1. A large variety of styles and sizes of type which are very easily
changed in a few seconds.

2. Flexible spacing which permits straight margins.

An automatic typewriter (autotype) consists of a standard type-
writer which is controlled by an electrical mechanism. The electric
mechanism is governed by a perforated roller strip which has been
prepared with a standard message or letter. This standard message or
letter can then be typed automatically. When portions of the message
must be varied, the machine can be stopped, the special portion typed
in manually, and then the remaining standard portion completed auto-
matically. An example of the use of the machine is given on page 191.

COMPUTING MACHINES

Computing machines vary all the way from slide rules and reckon-
ing tables to complex electronic computers. In between these two ex-
tremes are the adding and subtraction machines and the calculators
that are most commonly found of great value in clerical operations.

For multiplication, division, and related operations which do not
require extreme accuracy, the slide rule is an inexpensive and very
efficient computer. Tables, curves, and nomographs are also very valu-
able in many applications.*

* Slide rules are nomographs with sliding scales. For a discussion of the construc-
tion of all kinds of nomographs, the reader is referred to the following books:
Kraitchik, Maurice, Alignment Charts, D. Van Nostrand Company, Inc., 1944;
Levens, A. S., tomography, John Wiley and Sons, 1948; Douglass, R. D. and
Adams, D. P., Elements of tomography, McGraw-Hill Book Co., 1947. Also,
An Index of Nomograms by Douglas P. Adams, Technology Press of Massachusetts
Institute of Technology and John Wiley and Sons, Inc., New York, 1950, is a guide
to over 1,700 time-saving and error-reducing published nomographs in 21 fields of
science and engineering.

202 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Adding and subtraction machines may be classified with respect to
three principal criteria: (1) listing on tape versus non -listing machines,
(2) full keyboard versus ten-key arrangement, and (3) hand-lever
versus electric-powered machines. Multiplication and division can be
performed on adding machines, although not as rapidly as with cal-
culators which have automatic features especially designed for multi-
plication and division.

DICTATING MACHINES

One of the important problems of efficient office operation is the
scheduling and loading of the stenographic and secretarial workers.
Dictating machines may prove very effective in increasing typists'
output because of the increased scheduling flexibility they permit.
There are many varieties of equipment, the three principal types being
the

1. Wax or composition cylinder machines

2. Plastic and paper disk machines

3. Wire and tape machines

Most types have separate dictating and transcription or reproduction
units. In addition to being used to facilitate the preparation of typed
correspondence and other copy, many of these machines are well
adapted for recording conferences, discussions, and telephone con-
versations.

BELLING AND BOOKKEEPING MACHINES

Billing and bookkeeping machines are combinations of various types
of calculators and typewriters with properly adjusted stops. A great
variety of these machines are available. With the exception of the cash
register type of bookkeeping machine, these machines have typewriter
keyboards. They are either cylinder or flat-bed type: in the cylinder
type, forms are fed around the cylinder as in the standard typewriter;
in the flat-bed type, the material being typed is placed in a bed over
which the typing portion of the machine moves. When properly
applied, billing and bookkeeping machines may reduce labor and
errors, and increase posting speeds in many aspects of bookkeeping
and accounting work.

ANALYZING THE MACHINE UTILIZATION 203

MECHANICAL COLLATORS

Various types of mechanical collators are manufactured. The sim-
plest kind would be a vertical arrangement of several bins for hand
collating. Others provide for no more than the automatic ejection of
the pages from the two or more vertically arranged bins. Still others
will completely automatically collate and staple sets of two or more
pages.

SORTING EQUIPMENT

Many sorting devices such as pigeonhole racks are available from
office-equipment manufacturers. They should be chosen with care to
insure that motion-economy principles are followed, especially with
regard to normal and maximum work areas.

Manual selecting devices using rods, bars, or other special sorting
tools, together with cards which have notches, holes, slots, etc. may
provide a means for rapidly separating previously coded information.

PUNCHED-CARD EQUIPMENT

Punched-card equipment uses cards into which holes have been
punched in predetermined coded positions to indicate the data. The
primary advantages of using punched cards is that these data on the
card can be operated upon automatically by different machines, can
be analyzed over and over again in different ways for different pur-
poses without recopying the data, can be summarized by machine as
frequently and in as many ways as desired. For certain applications
having sufficient volume of work, punched-card equipment can be
very valuable. This equipment can be arranged to perform many busi-
ness functions which were formerly reserved for the human brain.*

The punched-card system of the International Business Machines
Corporation is typical. A punching machine transcribes alphabetical
and numerical information into the cards. To arrange the cards in any
desired order for analysis or summary, they are fed through a sorter
machine which arranges cards automatically in numerical or alpha-
betical sequence, according to any classification of information punched

* Professor Norbert Wiener coined the word cybernetics to cover the subject of
"control and communication in the animal and the machine." In his book Cyber-
netics published by the Technology Press and John Wiley and Sons, Inc., New
York, 1948, Dr. Wiener presents a most instructive and refreshingly dramatic
discussion of this subject.

204 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

into them. Where only certain cards are required for a given analysis,
the sorter will select these. A tabulating machine will read the punched
and sorted cards and selectively add, subtract, accumulate, and print
desired information.

Many additional types of machines supplement those just men-
tioned. Some will translate and print the punched information; punch
the summary information of the tabulator onto summary cards; elec-
tronically translate pencil marks on a card into punched holes; dupli-
cate part or all of the information from one group of cards into
another; merge two groups of cards arranged in sequence; withdraw
or separate one group from the entire deck; match or compare two
decks of cards; check the sequence of a deck of cards; multiply,
divide, cross-add, and cross-subtract different combinations of data
and punch the results in the same cards. Various tape reading and
punching machines can convert punched cards into punched teletype
tape and also convert punched tape into punched cards. Long dis-
tance transmission of punched-card information is thus possible, using
standard teletype equipment.

The flow chart on page 264 illustrates the application of punched-
card equipment to a payroll procedure.

PRINTING AND DUPLICATING EQUIPMENT *

Letterpress printing machines. Most printing is done by the letter-
press (relief, typeset, or type-high) process, although the printing
presses that account for the big volume of output are a far cry from
the small simple presses from which the process took its name. In
the letterpress method, reproduction is accomplished by the transfer
of ink from a raised (or relief) image to the paper or other surface
on which the copy is desired. The raised image is ordinarily made up
of (1) metal type characters locked in a frame (or chase), (2) a zinc
or copper photo-engraving (cut), (3) a solid type-metal plate (stereo-
type) which has been cast from a papier mache matrix (mat) made
from an original typeset or photo-engraved form, or (4) a hard-sur-
faced casting (electrotype) similar to a stereotype except that it is of
harder metal and is electroplated for long wear.

The presses which print from such forms are of widely varying de-
sign and size. There are platen presses (both the type form and the

*The material here presented has been adapted from Appraisal and Control of
Duplicating Service, April 1949, Executive Office of the President, Bureau of the
Budget.

ANALYZING THE MACHINE UTILIZATION 205

impression surface being flat), horizontal and vertical cylinder presses
(type form being flat and impression surface cylindrical), rotary presses
(both type plate and impression surface being cylindrical), and numer-
ous special adaptations of these basic designs. These machines range
from letter-size platen presses to the giant rotary web and web-perfect-
ing presses on which metropolitan newspapers are produced. In be-
tween these extremes, the great volume of printing is done on flat-bed
cylinder presses, the smallest common size of which (a pony press)
prints a sheet 17 by 22 inches an area four times the ordinary letter-
size sheet most frequently turned out in duplicating shops.

Obviously, however, the typesetting and casting machinery (Lino-
type, Intertype, or Linograph composing machines, Monotype and
logotype casters, stereotype casting equipment, and so on) are as
important a part of the letterpress method as the presses themselves.

Lithographic or planographic printing machines (including offset
variation). In the lithographic method the transfer of ink is from an
image that is neither raised nor recessed but is part of an almost per-
fectly plane surface. Hence the term "planograph." The method is based
simply on the afBnity of oil for oil and the lack of affinity of oil for water.
Traditionally the image transfer was accomplished by (1) drawing a
negative (reverse) image with a greasy lithographic crayon upon a flat,
porous limestone surface, (2) applying water, which adhered to all
except the greasy crayoned areas of the surface, (3) applying an oil-
base ink, which then adhered only to the grease image, and finally
(4) impressing a sheet of paper (or other material) upon the stone
surface, so that the sheet received a positive copy of the inked image.

Essentially this method of direct lithography is still used for some
classes of work ( notably large billboard posters and long runs of multi-
color labels).

However, it was the development of the offset variation along with
cheap, pliable, and workable substitutes for the stone printing surface,
and photochemical and other simple means of imaging the substitute
surfaces that permitted fully mechanized presses to bring lithography
down to everyday printing needs. Sheets of zinc (or aluminum) were
grained to give them some of the porosity of limestone. Being thin and
pliable, they could be readily curved for use on a fast-traveling cylin-
drical roller. Although zinc plates are still the most common surface
for photo-offset lithography, various heavy, coated papers have been
developed as still lower-cost substitutes for the lithographic stone.

Two main types of masters are available for offset reproduction:

206 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

(1) the direct-image plate (usually paper or plastic) and (2) the pho-
tographic plate (metal, plastic, or paper). The process of reproduction
is identical for both direct-image and photographic plate after the
plates have been prepared.

In direct-image offset work copy to be reproduced may be typed,
printed, drawn, or traced on any white paper by standard black type-
writer ribbon or any black ink ( though a carbon-paper ribbon or black
India ink is preferable). Either line or half-tone illustrations may be
cut and pasted on the same sheet with the typed or hand-drawn copy
in whatever arrangement may be desired. In fact, nearly any previously
printed or reproduced pages, forms, charts, tables, maps, or illustra-
tions may be used (with or without change) as originals for photo-
graphic offset plates. The original copy is photographed in the same,
enlarged, or reduced size, depending upon the desired size of the
finished copy.

The photographic negative is placed over the surface of a plate
(usually a thin sheet of grained zinc, but may be plastic-coated or
other specially prepared paper) which has been treated with a photo-
sensitive, grease-attracting chemical. The plate, thus covered by the
negative film, is exposed to an arc lamp. Light passes through the
transparent areas of the negative, tending to fix the grease-receptive
chemical on the exposed areas of the plate. The sensitizer is then
washed off the remaining areas, leaving the plate with an image which
will repel water and attract oily ink.

The offset press employs three cylinders a plate or form cylinder, a
rubber-blanket or offset cylinder, and an impression cylinder. The offset
plate is clamped to the plate cylinder. This cylinder, as it revolves,
rolls under a set of water and ink rollers. The image on the plate,
which repels the water and accepts the grease-base ink, is transferred
to the blanket cylinder (offset from plate to blanket). The blanket
cylinder, in turn, impresses the image upon sheets of paper as they pass
between the impression cylinder and the blanket cylinder. The plate
image is positive, the blanket image is negative, and the final image
on the paper again positive. Work in two or more colors can be pro-
duced by means of a separate plate and separate press run for each
color. The number of copies that can be run from one plate (from a
few thousand to more than 25,000) depends upon the kind and quality
of plate used. While most paper plates (either direct-image or photo-
graphic) are capable only of relatively short runs, at least one make
of photograph paper plate coated with a fine granular plasticis in-
tended to compete with metal plates in long-run work. A similar plastic

ANALYZING THE MACHINE UTILIZATION 207

plate is available for direct-image work but does not equal the photo-
graphic plate in length of run.

Office rotary-relief process machines. More popular before the
development of small, economical offset presses than at present,
rotary-relief office duplicators (such as the Multigraph) are still
feasible for certain kinds of work such as imprinting local identi-
fication on previously printed general materials, printing ready-made
envelopes, printing postal cards that require only a few lines of
type, adding a few lines of necessary color printing to work run
in standard black ink by another process, or printing small cards
or forms that need to be scored or perforated provided, of course,
the demand for such work is frequent enough to justify the machine.
For general work, however, the process is relatively inflexible; and
although press operating speed is high and efficient, the printing
normally is done from type which has to be set by hand, a step long
outmoded for commercial grades of text matter in the printing industry.
Although the handsetting process in this instance is considerably sim-
plified by the T-shaped base of the type and the slotted type-holding
construction of the printing cylinder, it nevertheless is a time-consum-
ing method and one which limits the flexibility of type arrangement.

Stencil process machines. The master copy for the stencil-duplicating
process (such as Mimeograph) is the stencil itself a thin fibrous sheet
covered on one side by a pliable, waxy coating through which ink will
not pass. A typewriter, a hand stylus, or a die may be used to impress
letters or other images upon the stencil with just sufficient force to
penetrate the coating, so that ink may pass through.

The stencil is placed on the outside of a perforated and padded ink
drum. As this cylinder is rotated, paper is fed between it and an im-
pression roller. The resulting pressure squeezes the ink from the pad,
through the openings of the stencil, and onto the paper, reproducing
the desired image. A high-grade stencil, properly prepared, should be
good for 5,000 or more serviceable impressions. If maximum use is not
made of the stencil at one time, it may be cleaned and stored for future
use. Work in two or more colors can be produced either by means of a
separate stencil and separate press run for each color or by tedious
spot-inking of the ink pad by hand. However, the costs and incon-
veniences of color work by this process make it rarely feasible.

Hectograph process machines. There are two different types of hec-
tograph process: (1) the gelatin process and (2) the liquid or spirit

208 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

process. The newer liquid process, being more efficient for general use,
is rapidly replacing the gelatin.

In the gelatin process, the master copy is generally prepared by using
a special typewriter ribbon or carbon paper impregnated with a strong
aniline dye. Hand-drawing or lettering may be done, however, with
special inks or pencils. The image to be reproduced appears in positive
form on the face of the master copy, just as it is to appear on duplicated
copies. The character of the ink accounts for the simplicity of the
process; but it also accounts for some fading of the reproduced image,
especially upon excessive exposure to sunlight.

The inked side of the master copy is impressed upon the gelatin
surface of the duplicator. The gelatin absorbs ink from the master in
the form of a reverse ( or negative ) image. Positive copies are obtained
by impressing blank paper against the gelatin, which transfers the
image to the paper by releasing a little ink each time a new sheet of
paper is impressed. Single inking is the reason for the gradual lighten-
ing of copies on runs of more than 50. Ink not taken off by the copies
gradually sinks into the gelatin, leaving the surface clear after an hour
or so. The gelatin surface thus can be used over and over again.

For the liquid (or spirit) process the master copy is prepared by
typing or drawing upon paper which is backed by a face-up hectograph
carbon sheet. The carbon transfers an image in reverse (or negative)
to the back of the paper. The paper and carbon for preparing the
original generally come in sets ready for insertion in the typewriter.

After preparation, the master copy is placed securely on a metal
cylinder, with the inked image outward. Sheets of paper are fed under
a moistening roller (so they will attract dye from the master) and
thence over or under the revolving master cylinder, from which the
inked image is transferred (in positive). The fluid used is an alcoholic
mixture, whence the term "spirit process." Each sheet of paper coming
in contact with the master removes some of the carbon deposit, or
dye, until the copies become too light to be legible. If the number of
copies run at one time does not remove all the dye, the master can be
saved and rerun at a future time. Ordinarily not more than about
150 clear, legible impressions are expected from one master, including
any reruns made from it (although some manufacturers now are mar-
keting hectograph carbon paper said to be good for three or four times
that number of legible copies).

By either the gelatin or the liquid process, work in two or more
colors can be reproduced in a single operation, simply by using various
colors of ink, ribbon, pencil, or carbon paper in preparing the master

ANALYZING THE MACHINE UTILIZATION 209

copy. For general work, however, purple is used almost exclusively
because that dye will produce a larger number of legible copies than
others.

Contact photocopy machines. There are many variations of the
familiar blueprint method of reproduction whereby an image on a
transparent or translucent sheet is transferred to a chemically sen-
sitized sheet by placing the two sheets together, exposing to light
(or other radiant energy), and then developing either in a chem-
ical bath (wet process) or a chemical vapor (dry process). If vapor
development is used (as in the ozalid process) the separate dry-
ing step is eliminated and curling of the finish prints avoided. Blue-
prints or other blue-line prints, brownprints or brown-line prints
(sepia or vandyke prints), black-and-white prints, and red-line prints
are a few of the varieties of finished products possible by these
processes. Ordinarily the same equipment, with changes of chem-
icals or of chemically treated paper, can be used to get various results.
The equipment most commonly available for ordinary use, however,
has been made more or less automatic at the expense of wide variabil-
ity in the results.

Copy to be reproduced by thes6 processes may be written, drawn,
or typed, so long as it is in sharp black on a transparent or translucent
ground. Since the image is transferred by direct-contact exposure
rather than by projection through a lens, no enlargement or reduction
is possible; the image of the finished print is the same size as that of
the original.

Projection photocopy machines. There are several varieties of pro-
jection photocopying machines, ranging from small portable models
to large stationary installations. The basic process is about the same
in each of them. The master copy can be any document, drawing,
book, or other object containing writing, lines, or pictures in any color
or combination of colors, in any size up to the maximum of the equip-
ment available.

The Photostat machine, a widely used make of photocopying equip-
ment, consists chiefly of a camera with a magazine for holding a roll
of sensitized paper. This assembly is mounted on a frame, to the front
of which is attached a movable subject-holder. The holder is charted
with guide lines and numbers to aid in scaling the copy. The machine
is equipped for mechanical focusing to the desired size of finished
work, which may be enlarged, reduced, or processed in the original

210 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

size. The subject is photographed through a prism lens. The prism
provides a means whereby the image, normally reversed by the lens,
is again reversed and carried to the sensitized paper in its original
position. The sensitized paper, after exposure, is processed through
developing, fixing, and washing solutions, and run through a drying
machine. In some models this entire process is done within the machine,
while for other models a darkroom is necessary for hand development.
The first copythough not a negative in the true sense of the word-
is a reverse print; the image is white on a black ground. This "nega-
tive" is then photographed if normal black-on-white copies are wanted.

GENERAL GUIDE TO REPRODUCTION METHODS

Number of
Copies

Type of Original

TEXT AND TABLES

DRAWINGS, CHARTS,
FORMS, ETC., WITH
OR WITHOUT TEXT

PHOTOGRAPHS, WITH
OR WITHOUT TEXT
AND DRAWINGS

1-10

Typewrite with
carbons
Photostat

Photostat
Ozalld**

Photostat****
Photograph

11 - 50

Typewrite with
carbons if
practicable
Hectograph***
Mimeograph*
Photostat
Ozalld**

Photostat
Ozalld**
Hectograph*"--*
Mimeograph* 1

Photostat****
OzaTld**
Photograph

51 - 150

Hectograph***
Mimeograph*
Multllith (offset)

Hectograph***
Mimeograph*
Multilith (offset)

Multllith (offset)
Printing (letter-
press halftone)

151 - 3500

Mimeograph*
Multllith (offset)
Multlgraph

Mimeograph*
Multilith (offset)

Multllith (offset)
Printing (letter-
press halftone)

More than 3500

Multigraph
Multllith (offset)
Printing (letter-
press;

Multllith (offset)
Printing (letter-
press from line
cut)

Multllith (offset)
Printing (letter-
press halftone)

* poor writing quality of paper
** if copy is opaque, transparency rnuat be made
*** colors feasible
**** poor tonal gradations

Figure S3. A rough guide in the choice of duplicating processes.

ANALYZING THE MACHINE UTILIZATION 211

Addressing machines. Although originally and primarily designed
for addressing envelopes and other material, the machines have
been modified by attachments to perform many varied duplicating
activities. Among these functions are the preparation of production
orders, process cards, etc.; the imprinting of short messages on cards;
the writing of pay checks; the preparation of regularly recurring in-
voices, such as telephone bills. There are two principal types of equip-
ment: one type uses stencils which are prepared in a typewriter; the
other uses embossed metal plates with inked ribbon.

GUIDE TO REPRODUCTION METHODS

As a general guide to the use of various types of duplicating and
printing processes, the chart of Figure 83 is presented. It indicates
which duplication processes are generally preferable depending on the
type of material to be reproduced and the number of required copies.

AUTOMATIC LOCKING FORMS REGISTERS

Various types of registers utilizing multicopy continuous forms are
conveniently used when exact protected copies are required. One copy
of the form, which is completed in the register, refolds in a locked
compartment when the other copies are removed.

PLANNING BOARDS AND MECHANICAL GRAPHS

Various types of clip, hook, pocket, grooved, strip, bar, tape, string,
and peg boards are manufactured for use in graphically presenting and
controlling various aspects of the enterprise's operations. These boards
are sometimes well adapted for providing visual summaries of produc-
tion, personnel, scheduling, work loading, sales, all kinds of perform-
ance and other operating data. Some examples of this equipment are:

1. Spring-clip panel boards

2. Hook bulletin boards

3. Multipocket racks

4. Grooved strip boards

5. Mechanical bar charts using colored bar cards

6. Boards using movable tapes or strips for recording progress or
visual bars

7. Colored signal pegs are frequently introduced on the tape and
string boards just described.

212 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

ELECTRIC STAPLERS

Electric staplers operate automatically upon insertion of paper into
the stapler. Eliminates hitting operation.

FOLDING MACHINES

High-speed power-driven machines are available which will auto-
matically fold letters, statements, advertising literature, etc.

FILLING OR INSERTING MACHINES

These relatively expensive machines insert prefolded sheets of paper
in envelopes at high speed.

ENVELOPE SEALING MACHINES

These machines vary from simple manual types to the fully auto-
matic motor-driven varieties.

OTHER EQUIPMENT

Paperwork conveying systems, such as pneumatic tubes, basket

conveyors, etc.
Communication equipment, such as telephone, teletype, Tempora-

tor, Telautograph, facsimile, television, etc.
Time recorders and stamps
Check writers, endorsers, signers, cancelers, etc.
Postage-affixing machines
Postal scales

Envelope-openers, including motor-driven type
Counters
Equipment for paper-cutting, punching, perforating, binding,

etc.

MODERN TECHNOLOGY IN THE OFFICE

It has not been practical to attempt to describe here in great detail
the large variety of ingenious and valuable equipment that has been
and is being developed. However, our survey has indicated how engi-
neers and inventors are constantly improving existing machines and

ANALYZING THE MACHINE UTILIZATION 213

designing new ones. Every year sees new developments which are
facilitating better systems. The New York Times, commenting edi-
torially in its October 23, 1949 issue on the National Business Show,
had this to say about modern technology in the office:

"What with typewriters, phonographs that take the place of stenog-
raphers, duplicating machines of a dozen different kinds, adding
machines, stamplickers, stapling machines and a score or so of gadgets,
it can't be said that the inventors have ignored the white-collar worker
in offices. The promotors of the National Business Show, which opens
today, think otherwise. They are sure that 'if business were as slow in
adapting new methods and equipment to the factory as it is to the office,
we would still be in a horse-and-buggy age/ Whatever may be said
for this argument there is no doubt that the inventors have been doing
their best to reduce office costs with contrivances that were never
dreamed of when clerks wore celluloid sleeve protectors.

"Here, for example, is a new typewriter ribbon that makes it easy
to erase mistakes without leaving a smudge. Just paint away the wrong
word or letter with a special eradicator. No rubber particles fall into
the machine. Then there's a push-button secretary that fools even the
most skeptical into accepting a chatty form letter as an original that
must have been specially composed. Flip a switch and slip a light card
into place and tailor-made replies to complaints and inquiries are
selected from sixty form paragraphs. Another machine gathers pages
into sets just sucks them up on the vacuum principle one by one and
transfers them to a moving belt in the right order. If a delivery arm fails
to work the vacuum is broken and the incomplete set of papers is re-
turned to be picked up again/'

Part III

EVALUATION, SELLING, AND INSTALLATION
OF PROCEDURES

X

SELECTING AND SELLING
THE SYSTEM

'ELECTING THE BEST availa-
ble alternative and selling this alternative first to the supervisory and
then to the operating personnel is the pivotal part of the systems
project. The same fundamental analyses, calculations, and reasoning
processes are used in both cases. The approaches and difficulties vary,
of course. Selecting the best system means selling yourself on the
system. Selling others should follow from this first selection process
with varying degrees of difficulty, depending upon a number of factors:

1. How good is the proposal?

2. How well is the proposal analyzed and presented?

3. How well can the analyst handle and influence people?

4. What are the personal characteristics and personal interests of these
other people?

Each of these questions will be considered in this chapter.

In determining the relative economy of alternative proposals, sim-
ple, logical cost analyses must frequently be made. It is essential that
all applicable costs be considered in the analysis and that the cost

215

216 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

estimates be sufficiently accurate. In particular, the changeover and
installation costs must not be overlooked. The detail procedures for
making economy analyses are described in a number of texts on engi-
neering economy. The essential basis for these analyses is always a
comparison of alternative costs. Many types of fallacious reasoning
may creep into an economy analysis if the basic alternatives are not kept
clearly in mind. To help give a clearer understanding of the process
of making cost comparisons and to illustrate some of the kinds of
errors which should be avoided, seven commonly occurring types of
errors were described by the writer in a recent article: * the assump-
tion of different levels of efficiency, the average interest error, the
book-value error, the capitalization of book-value loss, the inaccurate
assumption of future requirements, the incorrect use of overhead ratio,
and the improper interest rate. Although the examples here described
were adopted from actual situations, they have all been changed.

ASSUMPTION OF DIFFERENT LEVELS OF EFFICIENCY

The Doe Manufacturing Company's production-control system is
functioning poorly. The president engages an engineer to survey the
operations and recommend any required steps to improve the services
and efficiency. The engineer investigates and analyzes^ the present
operations and requirements. He then submits a report to the president
recommending a change to a newly designed system which he has
developed. The engineer's cost analysis shows that his proposed sys-
tem will provide the required production-control service at a total
annual cost of $168,000 as compared with the $203,000 annual cost of
the present system.

The president is greatly impressed with the engineer's proposal and
it is adopted by the company. The engineer supervises the installation
of the new system and is then hired to head the production-control
department. During the first year of operation under the new system,
the total annual cost of production control activities amounted to
$185,000. Although this is greater than the estimate of $168,000, it is
still a substantial saving over previous costs and the company manage-
ment is satisfied.

After five successful years, this engineer leaves the Doe Manufac-
turing Company and is replaced by a man of considerable production-
control experience. After becoming acquainted with the company's
operations, the new production-control head submits to the president

* Barish, "Don't Be Fooled by Erroneous Cost Studies," Mill and Factory, Decem-
ber 1949.

SELECTING AND SELLING THE SYSTEM 217

a plan for improving the system he has inherited from his predecessor.
The improved system which he proposes would, according to his esti-
mates, reduce the cost of the production-control services to $150,000.

Upon examining the details of the proposal, the president of the
company is surprised to notice that it is almost identical to the system
used by the company five years ago. He quite naturally asks why the
first system will now be cheaper than the present one, whereas five
years ago it was shown to be more expensive.

The new department head is given the detailed cost analysis of five
years ago and makes a study of the comparative cost figures used by
his predecessor. He discovers that his predecessor had compared the
current operating costs of the then existing system with the cost of
operations of his proposed system at a very high level of efficiency.
The fallacy of his predecessor's cost comparison was twofold:

1. The level of efficiency which his predecessor had assumed would
be obtained under the new system was too high. For this reason, only
$18,000 of the expected $35,000 annual savings were actually realized.

2. The level of efficiency at which the costs of operations of the
then existing system were computed was unconsciously too low. The
old system seemed more expensive than the new only because the old
system was operated and managed very inefficiently. If the cost analysis
had been based on the original and the new system being operated
at the same level of efficiency of the personnel, then the cost analysis
would have disclosed that the then existing system was essentially
better than the proposed and adopted one.

What was originally needed in this case was an improvement in
management of the department to raise the level of performance of
the personnel, not a change of system, as had been proposed by the
engineer and adopted by the company five years ago.

AVERAGE INTEREST ERROR

The systems analyst for a metal-parts manufacturer had developed
what he considered an improved material-control recording procedure.
The new procedure required the investment of funds in office equip-
ment which would cost $40,000. Time study analysis showed that as a
result of this investment, the annual cost of clerical labor would be
reduced from $40,000 to $27,000. Making the assumption that a 10 per-
cent return was desired on an investment of this kind and depreciating
the equipment on a five-year basis, the analyst came up with the fol-
lowing comparison of annual cost:

218 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Present System

Clerical labor $40,000.00

Total $40,000.00

(Other costs unchanged and therefore not con-
sidered in this analysis. )

Proposed System

Clerical labor $27,000.00

40000
Depreciation of new equipment '-= 8,000.00

Interest on investment in new equipment

( Ten percent of $40,000 ) 4,000.00

Total $39,000.00

There appears to be little saving to be obtained by adoption of the
proposed system. It was therefore not used.

If correctly calculated, the annual saving was more than 3M times as
great as the $1,000 saving shown above. Annual interest was computed
on the $40,000 original investment, despite the fact that the investment
was being reduced each year by the depreciation charge of $8,000 per
year. Actually, $4,000 is the valid interest charge for the firstryear only,
$3,200 (10 percent of the $32,000 book value of the equipment during
the second year) being the correct charge for the second year, $2,400
for the third year, $1,600 for the fourth year, and $800 for the fifth
year. The average annual interest cost is thus the average of this de-
creasing arithmetic progression, the first term of which is $4,000 and
the last of which is $800. The average interest over the five-year period

4 000 -4- 800
is then - ~ - = $2,400. Expressed in general terms, if C repre-

sents the original cost, N the number of years, and R the interest rate,

then f CR +-JT-J or CR ( ofc~) is the average interest cost per
year.

The annual costs of the proposed system should therefore have read:

Clerical labor $27,000

Depreciation, ~ 8,000
o

Interest, 40,000 X 0.10 X ^ 2,400

Total $37,400

SELECTING AND SELLING THE SYSTEM 219

This correct analysis now shows a distinct saving for the proposed
system.

BOOK-VALUE ERROR

The foreman in a furniture factory proposes the substitution of an
automatic shaper costing $9,000 for the two hand shapers presently
used. The one automatic shaper will be able to handle the volume of
work presently performed by the two hand machines and will reduce
the direct labor cost from $5,000 to $2,000 annually. However, the
shapers were purchased six years ago at a cost of $4,000 each and were
being depreciated $800 per year on the basis of straight-line depre-
ciation for an estimated life of ten years. The book value of each of
the hand shapers was thus $1,600. It is a company policy that all
new installations must pay for themselves in 4 years with interest at 10
percent.

The foreman made the following comparison of annual costs, as-
suming no salvage value for any of the machines at the end of their
estimated lives:

Hand Shapers

o (\r\r\

Depreciation, 2^ $ 800.00

Interest, 8,000 X 0.10 X 4) 440.00

Direct labor 5,000.00

Maintenance, repairs, power, supplies, insur-
ance, etc. 1,000.00

Total $7,240.00

Automatic Shaper

Depreciation, H^2 $2,250.00

Interest, 9,000 X 0.10 X | 562.50

Direct labor 2,000.00

Maintenance, repairs, power, supplies, insur-
ance, etc. 2,000.00

Total $6,812.50

On the basis of this analysis, the foreman notes an annual savings
of more than $400 if the automatic shaper is used and recommends its
adoption to the company.

220 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

In analyzing the annual costs if the hand shapers are kept, the fore-
man should have considered only those depreciation and interest costs
which would be avoided if the automatic shaper were bought, just as
the depreciation and interest costs for the automatic shaper would be
avoided if the hand shaper were kept. Thus the company is forgoing
the present salvage value of the hand shaper if it does not adopt the
automatic shapers. This forgoing of the present salvage value is the
equivalent of investing this sum of money in hand shapers and, to be
strictly logical, the company policy that new installments must pay for
themselves in 4 years should also apply here. These shapers could now
be sold for only $250 each or $500 total. In analyzing the annual costs
of keeping the hand shapers, the foreman should therefore depreciate
this $500 investment over a period of 4 years or the remaining expected
life of the hand shapers, whichever is less. In this case, the remaining
expected life is at least 4 years. Accordingly, the annual costs, keeping
the hand shapers, are:

Depreciation, $ 125.00

Interest, 500 X -010 X | 31.25

8

Direct labor 5,-000.00

Maintenance, repairs, power, supplies,
insurance, etc. 1,000.00

Total $6,156.25

The true annual cost of operations on the basis of continuing use of
the hand shapers thus turns out to be more than $600 lower than if
the change is made to the labor-saving automatic shaper.

CAPITALIZATION OF BOOK-VALUE LOSS

An engineer for a chemical manufacturer has come across some new
type of equipment which would apparently lower unit costs consider-
ably. In accordance with his detailed estimates of material, labor, sup-
plies, etc., the engineer computes that operating costs will be reduced
from $30,000 to $10,000. This new equipment will cost $125,000 and
will replace facilities which were purchased just two years ago at a
cost of $150,000. The present facilities were being depreciated on the
books of the company on a straight-line basis over a ten-year life,
giving them a book value of $120,000. Their resale value, if the new
facilities were purchased, is only $40,000. Using an 8 percent rate of

SELECTING AND SELLING THE SYSTEM 221

return on investment, the engineer made the following comparison of
annual costs based on a ten-year life for the new equipment and eight
years of remaining life for the old facilities:

Present Equipment

Depreciation, $ 5,000.00

8

Interest, 40,000 X 0.08 X ~ 1,800.00

16

Operating costs 30,000.00

Total $36,800.00

New Equipment

~ . ^. (120,000 - 40,000) + 125,000 ^ KAA ^
Depreciation, - - - - - - - - - $20,500.00

Interest, 205,000 X 0.08 X ~ 9,020.00

z\j

Operating costs 10,000.00

Total $39,520.00

Depreciation of the new equipment was calculated on the basis that
the cost of the new equipment equals $125,000 plus the loss involved
in selling the present equipment for $40,000 when it has a depreciated
book value of $120,000.

This analysis has convinced the engineer that his proposal is un-
economical and he therefore drops the whole matter.

Actually, this is a very good proposal and, if analyzed correctly, a
very substantial reduction in annual costs can be shown. The $80,000
book loss involved in selling the old equipment for $40,000 is a cost
which is not pertinent to the present problem. This $80,000 represents
the difference between the actual reduction in the resale value of the
equipment and the amount of this reduction which the accountants
have charged and recovered as production expense in previous years.
The economic advisability of making this replacement is independent
of whether past production costs were overstated or understated, al-
though this factor might affect financial ability to make the replace-
ment. We are here concerned solely with determining the relative
advisability of two alternative courses of action by comparison of the
annual cost increments which each alternative will cause. Past happen-
ings are only significant as guides to the future costs.

One of the alternatives is to invest $125,000 in new equipment which
will be used up in 10 years. If this alternative is chosen, then the manu-

222 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

facturer can sell the present equipment for $40,000. The other alterna-
tive is to keep the present equipment, which involves the investment
of $40,000 in a depreciating asset in the sense that the manufacturer
forgoes the $40,000 which he can get by selling the equipment now,
but will not be able to get 8 years from now.

The manufacturer is thus essentially investing $40,000 in a depreciat-
ing asset if he chooses to continue with his present facilities and
$125,000 if he decides to install the improved equipment.

Correct analysis of the annual costs using the new equipment, there-
fore, reveals the following estimate:

19^000
Depreciation, ^ $12,500.00

Interest, 125,000 X 0.08 X JJ 5,500.00

Zi\)

Operating costs 10,000.00

Total $28,000.00

Installation of the new equipment will thus result in a substantial
reduction in annual operating costssaving almost $9,000 per year.

INACCURATE ASSUMPTION OF FUTURE REQUIREMENTS

A company is setting up a separate plant to manufacture a newly
developed product. A special nut, required in this product, can be
made on an engine lathe costing $4,000 or a turret lathe costing
$15,000. The turret lathe will have lower material wastage, decreasing
material cost from $0.160 to $0.155 per unit. Operating rate using the
turret lathe is 30 pieces per hour; using the engine lathe the rate is
10 pieces per hour. Three engine lathes will thus be required to equal
the capacity of one turret lathe. The operator of the engine lathe
would make $2.00 per hour; the turret lathe operator $1.60 per hour.
Repairs, power costs, tools, and all indirect expenses for each of the
engine lathes add up to an average of $1,800 per year. Set-up, repair,
power costs, tools, and other indirect expenses for the turret lathe add
up to an average of $9,600 per year. Estimating a life of ten years for
the engine lathe and 6 years for the turret lathe, assuming no salvage
values, and using a return of 6 percent on investment, the following
unit cost comparison was made on the basis of a 2,000-hour work year
( 50 weeks times 40 hours ) :

SELECTING AND SELLING THE SYSTEM

223

Engine Lathe
Direct labor,

2.00

10

Direct material
Repairs, power, tools, other indirect expenses

1,800 1,800

10 X 2,000 ~~ 20,000

^ . ^. 4,000 ^
Depreciation, _ X

Interest, 4,000 X 0.06 X X

Total cost per nut

Turret Lathe

160
Direct labor, -^r-

Direct material

Repairs, power, tools, other indirect expenses

9,600 __ 9,600
30 X 2,000 ~~ 60,000
- . ^ 15,000 ^ 1
Depreciation,-^-

Interest, 15,000 X 0.06 X ^ X
Total cost per nut

$ 0.200
0.160

0.090
0.020

0.007
$ 0.477

$ 0.053
0.155

0.160
0.042

0.009
$ 0.419

Since the analysis shows a saving of almost six cents per nut using
the turret lathe, the methods man included the turret lathe in his rec-
ommendation for new equipment. He neglected to consider one crucial
aspect: how many of these special nuts will be required each year?
If 60,000 will be needed, then the turret lathe is the more economical
machine and the cost comparison is valid. If, however, the new plant
is expected to produce 20,000 units of this new equipment per year
and only one of these special nuts is used in each equipment, then a
correct analysis of unit costs will disclose that the engine lathe is more
economical.

The expected requirement for the nuts in this case was actually only
20,000. Therefore, the unit costs of production using the one engine
lathe that will be required are the same as those previously calculated
totaling $0.477. The unit costs using the turret lathe, however, are
much higher than those calculated because of the excess machine
capacity which will not be required:

224 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

1 60

Direct labor, ~ $ 0.053

oU

Direct material 0.155

Set-up, repairs, power, tools, other indirect expenses,

1 t f\(\f\ i

Depreciation, __ X 125

Interest, 15,000 X 0.06 X ^ X ^ 0.026

Total cost per nut $ 0.839

Unless it were anticipated that requirements would increase or that
the excess capacity of the turret lathe would be otherwise utilized, the
methods man should have recommended the engine lathe rather than
the turret lathe.

INCORRECT USE OF OVERHEAD RATIO

A machinist submits a proposal under the Employee Suggestion Plan
in operation in a large manufacturing company. He suggests using a
fixture which he has designed to reduce the labor required in the
assembly of a sub-unit which is used in the company's products. To
show the worth of his suggestion and to provide the basis for the
determination of the amount of the suggestion award, the following
analysis of cost savings is submitted:

Item Amount

1. Direct labor required per assembly sub-
unit: Present method 8.725 min.

2. Direct labor required per assembly sub-
unit: Proposed method 6.307 min.

3. Direct-labor savings per assembly sub-unit

(Item 1 Item 2) 2.418 min.

4. Average direct-labor cost $1.20 per hour

5. Number of sub-units manufactured and

used per year 40,000

6. Total direct-labor savings

(Item 3 X Item 4 X Item 5)

gO $1,934.40 per year

7. Departmental overhead rate 50% of direct-labor

dollars

SELECTING AND SELLING THE SYSTEM 225

8. Overhead cost savings (Item 6 X Item 7) $ 967.20 per year

9. Total savings (Item 6 + Item 8) 2,901.60 per year
(The cost of the fixture was negligible and

therefore omitted from the analysis.)

The error in this calculation is in the assumption that a reduction in
the direct-labor cost required in the assembly of the sub-unit would
necessarily produce a 50 percent reduction in the overhead costs
because the overhead costs for the department average 50 percent of
direct labor. Actually, there might be no overhead cost savings as a
result of the adoption of this suggestion; or there might be some sav-
ings, but less than 50 percent of the direct-labor savings; or there might
perhaps be an overhead savings greater than 50 percent of the direct-
labor savings. There might even be an increase in the overhead costs
as a result of the adoption of this suggestion. It is necessary to deter-
mine by direct analysis the overhead costs, if any, which will be
reduced as a result of the adoption of this suggestion.

In the case of the proposal just mentioned, investigation disclosed
that practically no reduction in overhead costs would occur as a result
of the adoption of this suggestion. Therefore, the correct analysis would
show total prospective savings of $1,934.40 rather than $2,901.60.

IMPROPER INTEREST RATE

The manager of a plant is considering the replacement of a certain
machine with a model of improved design which cuts operation costs to
less than one third. He asks two of his methods engineers to make
independent surveys and determine whether the replacement is desir-
able. When he receives the reports, he notes that Engineer A's analysis
indicates that the replacement should be made and Engineer B's
analysis indicates that the old machine tool should be retained. The two
analyses are reproduced below:

ENGINEER A:

Present Machine

Depreciation, $ 375.00

Interest, 1,500 X 0.035 X jj 32.81

o

Operating costs 4,000.00

Total $4,407.81

226 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

New Improved Machine

Depreciation, ^22 $2,500.00

Interest, 20,000 X 0.035 X 394 -

ID

Operating costs 1,200.00

Total $4,094.00

On the basis of the analysis shown above, annual costs will be
lowered more than $300 if the present machine is replaced. Engineer A
therefore recommends purchase of the new improved machine.

ENGINEER B:

Present Machine

1 600
Depreciation, -^ $ 400.00

Interest, l,600x 0.08 X I 80.00

o

Operating costs 4,000.00

Total $4,480.00

New Improved Machine
90 onn
Depreciation, ^~ $2,500.00

Interest, 20,000 X 0.08 X -775 900.00

lo

Operating costs 1,200.00

Total $4,600.00

On the basis of Engineer B's analysis, the total annual costs would be
higher if the new improved design were adopted at the present time.
Engineer B therefore recommends that the present machine be
retained.

Both engineers estimated almost the same costs and salvage values.
(Engineer A estimated salvage of $1,500 for old machine; Engineer B
estimated a $1,600 salvage value. ) The principal differences are caused
by the rate of return which each engineer estimated was required on
the money investment.

This rate of return should indicate two components: one element
would be the return which conservatively invested money can earn;
the second element would be an additional return to compensate for
the risks involved in the investment. The greater the risks and possi-

SELECTING AND SELLING THE SYSTEM 227

bilities of loss of money because of business fluctuations and changing
economic conditions, because of technological changes and the highly
competitive nature of the business, and because of lack of a sound
basis for estimating expenses, etc., the greater this second element
should be.

On reviewing the two analyses presented by his engineers, the plant
manager decided that Engineer A neglected to make sufficient allow-
ance in his estimated rate of return for this second element. A 3# per-
cent return barely covered the cost of a conservative well-protected
loan and certainly made no allowance for the risks involved in the
investment.

UNDERSTANDING OF ALTERNATIVES AND ASSUMPTIONS

In evaluating the reliability of any economy analyses, it is necessary
to consider the validity of the underlying assumptions. All of the cal-
culations may be correct, but if the basis for the calculations is false,
or is not suited to the situation being studied, the answer may be
worthless.

Many errors are made in economy and cost analyses because of a
failure to think clearly in terms of the alternative costs involved. To
avoid errors, it is important that only actual alternative costs be con-
sidered; that the interest rate which is used be reasonable and adequate
for the risks involved in the investment; and that interest charges be
computed only on money which is actually invested and which is un-
available for other productive use because of the adoption of the alter-
native. Estimates of overhead cost savings should be based on actual
analysis of the effects of a proposal on these costs rather than on the
overhead ratio of the department or plant. An economy analysis will
give a biased result if the estimator, consciously or unconsciously, com-
pares the cost of one method or system operating with good manage-
ment and efficiency, with another one operating with poorer manage-
ment at a lower level of efficiency. In addition, all annual cost compari-
sons must be based on a reasonably accurate estimate of anticipated
production volume or the analysis may give a fallacious result.

Besides pointing out errors which should be avoided, these examples
show that, correctly to interpret a cost analysis, it is necessary to under-
stand the basic assumptions, financial requirements, and risks involved
in the alternative. It is not simply a matter of adding up two columns
of annual costs and noting which column gives the lower total. Cor-
rectly to evaluate the real significance of the saving which is indicated

228

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

by the cost comparison, one must also evaluate the adequacy of the
assumptions and estimation methods used.

EVALUATION OF INTANGIBLE ELEMENTS

Many of the advantages and disadvantages of alternative systems
proposals cannot be conveniently evaluated on a dollars-and-cents
basis. These intangible elements of varying individual importance may
sometimes be of greater importance than those factors which have been
quantitatively evaluated into dollars and cents.

ELEMENTS

Importance

ALTERNATIVE METHODS

Present method

Alternative 1

Alternative 2

Alternative 3

Alternative 4

Rating

Rating

Rating

Rating

Rating

U)

(2)

(3)

(4)

(3)

(4)

(3)

(4)

(3)

(4)

(3)

(4)

TANGIBLE
ELEMENT

1. COMPARATIVE
COSTS

INTANGIBLE
ELEMENTS

2.

3.

"""""-

4

Total

100

xxxxxx

xxxxx

xxxxx

xxxxx

xxxxx

Figure 84. Systems Evaluation Worksheet, useful in promoting clearer
reasoning in arriving at a systems decision.

To promote clarity in his own thinking as well as to provideTa
method of demonstrating to others, an analysis of the relative merits
of two or more alternatives using a Systems Evaluation Worksheet such
as shown in Figure 84 may prove very convenient.

Each of the intangible elements which are of importance in the com-
parison of the alternatives is listed in the left-hand column. The com-
parative importance of the tangible cost analysis and of each of these
intangible factors in the promotion of efficient operations is then
estimated. These relative importance values are assigned so that they
total 100. Each element is then given a rating from to 10 in Column

SELECTING AND SELLING THE SYSTEM 229

(3) under each alternative proposal. For example, the manufacturing
time cycle might be one intangible element. Alternative 1 may have a
very short time cycle, alternative 2 a very long one, and the present
method an average one. Alternative 1 might then receive a good rating
of 9, alternative 2 a rating of 0, and the present method a rating of
5 or 6. The rated value for each element is determined by multiplying
the importance and the rating, placing the product in Column (4). The
total rated value for each alternative method can then be obtained by
addition of the rated values for each significant element.

When agreement is difficult to obtain on a rather involved system,
this method of analysis may be of value in clarifying the thinking of
the various people on the relative merits and demerits of various pro-
posals. By promoting the organization of thoughts on the essential
elements, it will help bring agreement or will aid in disclosing the basic
items of disagreement.

THE REPORT

Having determined the relative worth of the alternative proposals, it
is desirable to work up an analytic statement which will present the
proposal in detail to management and the supervision. How elaborate
the report should be will depend on the nature and scope of the survey,
the size of the investigation, and the amount of selling on details that
is required. The next chapter is devoted to an outline of essentials of
good systems report preparation. The charts, graphs, tables, and textual
material of the report are all selling devices which should be used to
maximum advantage. Many of the charts presented earlier in this book
are effective means of comparing the old system with the proposed
improvements.

SELLING A NEW SYSTEM

The ability to sell a proposal, to handle and influence people depends
to a great extent on an understanding of their motivations. What do the
managers and employees of the enterprise want from their companies
and their jobs? How do they react to the various stimuli created by the
activities and proposals of the systems analyst? A firm understanding
of these questions will provide the basis for effectively selling improve-
ments.

There are no fixed and definite rules for selling a new system either

230 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

to the management of a company or to the employees who are to
operate and work under the system. However, both of these tasks are
very important. Unless management is sold on the desirability of a pro-
posal, it will not be adopted; and unless the persons who will supervise
and operate the system are sold on its desirability and correctness, it
will usually not be successful.

A competent systems man does not make the mistake of considering
his selling job done when he has obtained management approval of his
plans. In fact, the selling of top management may frequently be the
easier part of the job and the systems report is one of the principal aids
in this task.

Although the personal approach and attitude of the systems analyst
is important in both of these selling tasks, it is of predominant im-
portance in selling the operating personnel. The job of selling these
persons begins the first time the systems man meets them, before he
even knows what scheme he desires to sell. A poor start in building up
a cordial relationship is very hard to overcome.

EMPLOYEE MOTIVATIONS

In developing the best approaches in dealing with people, the sys-
tems analyst will be greatly aided by a consideration of their more com-
mon motivations and attitudes.

People resist change; they fear change; they cling to customs, espe-
cially those of long standing. Suggestions of changes in methods of long
standing are bound to meet resistance unless they are carefully pre-
sented. It is because of this natural resistance to change that most
progress is evolutionary rather than by leaps and bounds. It is because
of this natural resistance that most persons are suspicious and fearful
of all proposal? to change the status quo.

It is necessary, therefore, for the systems analyst to overcome this
natural fear and distrust by appealing to the self-interest of the per-
sonnel and to their underlying motives and drives, such as the desire
for recognition of one's work and the craving to be above other persons
(the power motive). People desire that attention be paid to their
thoughts and action. They are unhappy unless they feel reasonably
secure in their jobs.

Everett R. Smith lists six basic things which the worker wants from
his employer: *

"What the Wage Earner Thinks," Production Series, Number 187. New York,
American Management Association.

SELECTING AND SELLING THE SYSTEM 231

1. Fair pay and a chance to really earn it.

2. Self-respect the opportunity to feel that he is really part of the
company and not just a cog in a machine.

3. Security in the job, and reasonable welfare plans.

4. Opportunity for advancement.

5. Fair play the elimination of favoritism and a straightforward deal-
ing between management and workers, with prompt and definite
response to complaints.

6. A management which is capable and efficient in handling its opera-
tions.

Good systems promote all of these basic desires of the worker. If
they do not, then they are not good systems. By keeping these aspects
of the systems goal in the forefront at all times, the systems analyst can
do a better and more effective job at all levels of the organization.

The systems analyst should always be on the alert to show that he
has carefully considered employee interests; to show how his proposals
will benefit the worker and supervisor by:

Eliminating overtime
Improving working conditions
Reducing pressure and amount of work
Providing higher job ratings

Increasing job security through a more competitive position for the
firm when costs are decreased

Providing funds for possible pay increases

Increasing promotion opportunities

Enabling greater creative expression of the worker.

As pointed out in Chapter XIII, it is advisable to establish a definite
policy to protect the status and tenure of employees whose positions
are affected by systems changes.

SUGGESTIONS FOR EFFECTIVE SELLING

Some specific suggestions of what to do and not to do might prove
helpful. Most of these will undoubtedly seem self-evident. Neverthe-
less, this obvious quality has not always given them the universal appli-
cation which it would seem they deserve. No attempt has been made
to group these suggestions by importance or to make an exhaustive
presentation. Some additional considerations in the handling of people
were presented in the discussion of the methods of obtaining systems
data in Chapter IV.

232 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Volumes can be devoted to the subject of handling and influencing
people. Thousands of rules can be listed to promote more effective
selling. But they will all boil down to two basic principles: understand
the motivations of the persons you are trying to sell; always be tactful
and observe good manners.

The systems analyst should always pay attention to persons while
they are talking. And let them talk as much and as long as they desire.
There are a number of advantages to letting the other fellow talk first
and as much as he desires:

1. He tells you what his position and possible objections are and thus
gives you valuable information for planning your strategy to win
him over to your side.

2. In talking out his objections, he may sell himself on the logic of
your suggestion before you have even attempted to appeal to his
reason.

3. If you hold forth while he has some objections which he desires to
expound, he will be turning these objections over in his mind
instead of listening carefully to your exposition. As you talk on with
only a semblance of attention on his part, his objections will be
amplified by his irritation at being unable to express them.

Never tell anybody directly that he is wrong. It is practically always
unnecessary and represents a negative approach. Concentrate on your
proposals and how things can be improved, which is a constructive,
positive approach. The simplest, surest way to make an enemy is to say,
"You are wrong." It is a foolproof method.

By a questioning rather than a declaratory approach, it is frequently
possible to get the operating or supervisory personnel to say what is
wrong with the present system. By carefully planting ideas, it is often
feasible to get these people to suggest your solution even when it was
not originally their own. Both of these are very desirable because every-
body likes ideas which he considers his own.

Never argue. If you cannot gain your point except by argument, it is
usually better to concede the point for the time being and, if it is im-
portant, return some time in the future when you can discuss the
matter from a better perspective. As Dr. Samuel Johnson wisely re-
marked: "Every man will dispute with great good humor only upon
a subject in which he is not interested."

Be careful not to induce an argumentative attitude by unconsciously
raising your voice or allowing a cynical attitude or expression to enter
into a discussion.

SELECTING AND SELLING THE SYSTEM 233

When discussing a proposal to which a person objects, first show
your objector that you understand his objection by restating it. Even
expand a little on some of the good points of his objections to show
that you appreciate his viewpoint. It is very important for him to know
that you thoroughly understand his position and consider it sensible
even though he may not have considered everything.

Before chancing a rebuff in order to gain a point in a discussion,
remember that it takes a lot of ingratiating to overcome just one little
slip which induced dislike. Again quoting Dr. Johnson: "Men hate more
steadily than they love. If I have said something to hurt a man once, I
shall not get the better of this by saying many things to please him."

Always give credit where credit is due and, if it will help your public
relations, even sometimes where it is not due. Do not allow yourself to
get the reputation of being an idea stealer.

It may sometimes be helpful in obtaining the cooperation of super-
visory personnel to submit a joint report with the signatures of the
operating personnel appearing on the recommendations. This may be a
powerful means of overcoming hostility, because most people are not
quite as scared of changes when they have had a part in suggesting
them and will receive due credit.

One of the important aspects of selling and influencing people is to
know the characteristics of the persons with whom one is dealing. With
this knowledge and a little finesse in human relations, much can be
accomplished. Three examples of how prior knowledge of personal
characteristics proved very effective in selling are presented here:

I. It was the habit of George Roberts, president of the Pennsylvania
Railroad, to show his subordinates that he was fully aware of their
doings by adding to or taking away something from the projects they
submitted to him. One of Mr. Roberts' division superintendents, D. M.
Caldwell later a president himself had obtained permission to build
a new station, in which he was deeply interested. Caldwell designed a
station according to his own ideas, and to prevent Roberts from making
any essential changes he added an unnecessary bay window to the
waiting room. Roberts carefully examined the plans and said, "Remove
the bay window and you have my approval/* Caldwell had what he
wanted.* ' ; : "I^IWI

II. One of my recurrent difficulties in stage designing was caused
by a certain actor who seemed invariably to dislike the clothes intended

* Chauncey M. Depew, My Memories of Eighty Years. New York, Scribners,
popular ed., 1924. (Adapted.)

234 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

for him, and to hanker after those of his fellow-players. In one piece
it was absolutely necessary for the balance of my picture that he
should wear a certain costume. I felt sure he would object to it, so I had
it made carefully to his measure and allotted it to a minor character,
who at once became an obtrusively conspicuous figure. Soon as I had
foreseen the leading man drew me aside.

"This costume of mine, you know," he began. "It's fine, of course. But
that costume there right in the corner oughtn't it to be nearer the
center?"

I agreed it certainly should.

"I suppose," he went on, "that it wouldn't do for me to wear it instead
of this?"

I admitted that it would look very well. He vanished, and soon re-
turned, attired as I had hoped to see him. "It's a most extraordinary
thing," he exclaimed. "It fits me exactly." *

III. Liszt, as an old man, very rarely played. Count Hatzfeldt, then
German ambassador to England and a great friend of Liszt's, when
consulted by a hostess as to how she could induce Liszt to play, had
answered: "Put the piano in the darkest corner of the room, and pile
all sorts of things on it. Then he won't think you have asked him in
the hope of hearing him play, and perhaps we can persuade him."

All the music was hidden away, and the instrument covered with
photographs, vases of flowers, heavy books. After luncheon Hatzfeldt
began talking to Liszt about Offenbach's melodies particularly one
song he had improvised for the Empress he couldn't quite remember
it. If there were a piano he looked about. "Oh, yes, in a corner, but so
many things upon it, it was evidently never meant to be opened." He
moved toward it, Liszt asking the hostess if it could be opened. Hatz-
feldt played a few bars in rather a halting fashion. After a moment
Liszt said: "No, no, it is not quite like that." Hatzfeldt got up, and Liszt
seated himself, played two or three bits of songs, then, always talking
to Hatzfeldt, by degrees broke into a nocturne and a wild Hungarian
march. His touch was that of an old man but a master. When he
got up, he said: "Oh, well, I didn't think the old fingers had any music
left in them." f

* W. Graham Robertson, Life Was Worth Living. New York, Harpers, 1931.

t Mary King Waddington, M y First Years as a Frenchwoman. New York, Scrib-

ner's, 1914. (Adapted.)

XI

WRITING SYSTEMS REPORTS
AND PROCEDURES

PRESENTATION of sys-
tems recommendations and reports is usually done in writing, and pro-
cedures are written to make the systems known to the enterprise's per-
sonnel. The success or failure of the systems analyst's work may often
hinge on his effectiveness at these tasks. Reports which concisely and
graphically present the important points in easily understood language
will have the most sales appeal. We will therefore consider in this
chapter what subject matter should be included in systems reports
and in written procedures; and how this material should be presented
to promote maximum understandability and effectiveness.

ELEMENTS OF THE SYSTEMS REPORT

There are many variations in arrangement and content of a systems
report, depending on the subject and scope of the investigation, the
length of the report, and the audience for which the report is written.

235

236 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Some of the elements discussed below are required in every report;
some are optional.

Title. Every report should have a title or subject heading, providing
a concise description of the material being presented. Any identifying
project number should also appear on the title page.

Signature. The name or names of the person or persons responsible
for the report and the investigation should appear either at the begin-
ning or end of the report.

Date. Every report should be carefully dated. The date of the report
should usually be the date of submission. All materials, facts, charts,
and data should be individually dated to indicate the time at which
the analyst can attest to their being the true state of affairs.

Table of contents. Most reports of any size should contain a table of
contents or index of some sort to inform the reader of the arrangement
and contents of the report.

Purposes and scope. All reports should include a statement of the
purpose or purposes of the investigation and report, including who
requested that it be made, as well as its scope. Acknowledgments of
cooperation and assistance received from various personnel should be
included at this point.

If warranted by its length and complexity, the statement of the
objectives or purposes may comprise a separate section from the outline
of the scope of the investigation and report. The section on scope
should include any necessary explanations of the limitations of the
survey data, the information, and the conclusions obtained in the con-
duct of the investigation.

Summary. It is frequently desirable in the case of long reports to
have a short summary in the beginning. This summary enables the busy
top executive, who does not have the time to read the entire report, to
gain an over-all picture of the investigation. The summary should pro-
vide a brief resum6 of the salient points covered in the analytical sec-
tions of the report as well as a short statement of the conclusions and
recommendations.

Definitions. In some cases, several of the terms used in the report
may be subject to various interpretations. To prevent misinterpreta-
tions, a section defining these terms should be included in the
report.

Analytic sections. The analytic sections of the report will first present
the facts disclosed by the investigations. A historical presentation of
past occurrences may sometimes be valuable to provide a background
for the current analysis. Some of these facts on the presently used sys-

WRITING SYSTEMS REPORTS AND PROCEDURES 237

terns might be clarified by the various systems-charting techniques
described in earlier chapters. These facts are then analyzed in the
report in terms of the principles developed in the earlier sections of
this book. Possible alternatives may be presented and, in turn, ana-
lyzed. A section of the report may be devoted to detailed presentation
and analysis (including charts, photographs, etc.) of the proposed
alternative which appears most desirable. An economic comparison and
evaluation is very valuable whenever it is possible.

Conclusions and recommendations. The sections on the conclusions
and recommendations of the investigation may be separate or com-
bined into one. The conclusions which stem from the preceding analysis
are explained in logical sequence. Then the recommendations for
implementing these conclusions are presented. How should the pro-
posals be given effect? When should the installation of new procedures
begin and what is the correct timetable for its completion? How should
the affected persons be sold on the new methods? What instructional
aids and/or training programs should be utilized? How much systems
staff time will be required to implement the conclusions and recom-
mendations? What important related problems could not be studied
because of lack of time or limitations of scope? Which of these should
be studied in the future when more time is available?

Appendix. The appendix to the report should contain statistical tabu-
lations, lists of references and persons supplying various parts of the
information and data, charts which do not properly fit into the body
of the analysis, any visual aids and written instructions for the installa-
tion of the proposal, blueprints, photographic details, worksheets,
etc.

Required and optional sections. Formal reports should have a distinc-
tive title and, if assigned, a project number; the name of the person or
persons responsible for the report; one or more dates; a statement of
purpose; a presentation and analysis of facts; and, unless it is the result
of a purely informational survey, some conclusions should be reached.
All material and data in all sections of the report should be meticulously
labeled to indicate the sources from which they were obtained.

Depending on the size, nature, and purposes of the investigation and
report, it may be desirable in some cases to include an index or table
of contents; to outline carefully the scope and the limitations of the
survey; to include a separate section summarizing the analysis, conclu-
sions, and recommendations; to define any possibly ambiguous terms;
to provide recommendations for implementing the conclusions; and to
include an appendix.

238 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

ELEMENTS OF THE PROCEDURE

Just as there are no definite rules applicable to all situations on the
content and arrangement of systems reports, so there are no fixed rules
on the content, arrangement, and format of procedures.

All procedures should contain the information on dates, titles, num-
bers, distribution, forms, associated procedures, etc., as outlined in
the final chapter on the systems department's operations.

Some of the elements described in the discussion of systems reports
are equally applicable to procedures.

1. An initial statement of the scope of the procedure, what it covers
and the limits of its coverage, is always desirable in a procedure.
This statement should clearly define the area within which the
procedure is effective.

2. A statement of the importance of the system being established to
the proper functioning of the enterprise is frequently desirable.
What is the purpose of the function? What will the procedure
accomplish? Why is the paperwork or the report needed?

3. A summary of the procedure or an index may be very helpful when
a long or complex system is being presented.

4. If some organizational unit has an unusual and major responsibility
in the operation of the system, this fact might be emphasized in a
separate introductory section of the procedure.

Fv If any of the terms or concepts used in the procedure are subject to
misinterpretations, a section defining these terms might be included
in the early part of the procedure. It is advisable to be certain that
all new items or relationships with which the reader is unfamiliar be
clearly explained.

The procedural material should be organized in a logical and readily
understandable fashion. A number of different logical approaches are
usually possible, but usually only one of these will provide maximum
understanding. The analyst must examine all possibilities to provide
the simplest and clearest organization of the material.

Procedural material may be effectively presented in chronological
sequence. This organization is the best for ease of understanding the
operation of the entire procedure. It is therefore well suited to relatively
short procedures or those in which few sections of the company are
involved. However, when numerous departments are involved in a
relatively long procedure, the chronological organization is more diffi-

WRITING SYSTEMS REPORTS AND PROCEDURES 239

cult for the operating personnel to follow than one in which the opera-
tions of each department are grouped together.

In this departmental organization of the material, the activities of
each department are explained in a sequence as nearly chronological
as possible. The personnel of each department concerned need read
carefully only its own section of the procedure. However, to a person
desiring an over-all picture of all the operations, this departmental
break-down is harder to follow. To provide this over-all picture in a
long departmentalized procedure, a chronological summary can be
included.

When the departmental break-down is called for in a long and com-
plicated procedure, the writer has successfully resorted to a procedural
design which cross-references the systems flows in a uniform fashion.
An example of this "Information Received, Source, Action Taken" form
is shown below:

"VI. Procurement Department

INFORMATION RECEIVED: Purchase Requisition Change
SOURCE: Material Ordering Section (see section III-B)
ACTION TAKEN: issue new purchase order for revised
requirements."

In writing a procedure, reflect the point of view of the user of the
procedure. It is desirable to consider its comprehensibility to the dullest
persons who will be required to understand it. While avoiding the ap-
pearance of writing down, direct the material to the lowest level of
comprehension of your anticipated audience.

To provide a complete explanation, the procedure should explicitly
indicate the source of all information and forms referred to therein,
what action is taken on receipt of the information or forms, and the
entire distribution of information, forms, and material.

Specific, concrete examples are generally preferable to long general-
izations in clarifying a system. Also, pictures, samples of actual forms
and how they are used, specimen reports, statistical tables, etc., will
frequently give a clearer picture of the situation than many pages of
explanation.

The possibilities of clarifying procedural explanations through the
use of the many charting and lay-out techniques presented in the
various chapters of this book should not be overlooked. They should be
included in the procedures wherever they will aid understanding.

Procedures should not refer to personal names, but should use organ-

240 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

izational titles. The procedure is thus not made obsolete whenever the
organizational assignment is changed.

In the Appendix to this Chapter is shown an example of the written
procedures used at the RCA Victor Camden Plant. Other examples are
shown in the Appendices to Chapter XIII.

CLARITY AND EFFECTIVENESS OF STYLE

We want to consider here methods of improving the clarity of reports
and procedures. By improving the clarity is meant increasing the
effectiveness of the communication provided by the written sequences
of words. The efficiency of communication can be measured by the
amount of space or time required to complete transmission of informa-
tion, as well as by the accuracy of the transmission.

Of the various guides to more effective methods of expression which
can be offered, many are related to custom and traditional practice,
such as rules for punctuation. This is to be expected, because punctua-
tion marks convey a meaning which is determined by its past usages
and present practices, just as the meanings of words are dependent on
past and present usage.

It almost goes without saying that the more familiar the words used
in the report, the easier will be the communication. Therefore, it is
desirable to use words which have the most general usage to the pro-
spective readers. The same words are not always the familiar ones to
different groups. There is, however, a common group of words which
are familiar to most literate Americans.

Brevity

Not only should familiar words be used, but there should not be too
many of them. Brevity is the soul of wit and no one likes to read fifty
words when twenty-five will convey the same meaning.

For example, a procedure was written some time ago containing the
following paragraph:

"Critical items which are of the most urgent nature, and which
must be expedited as soon as possible: In cases such as these
it will be necessary for the expediters (for the stockroom) to
make either telephone contact, or personal contact with the
delivery group. They will discuss the situation (verbal contact
is required as indicated above) and will determine which of
the following types of vendor expediting should be performed
and the extent to which it should be done.

WRITING SYSTEMS REPORTS AND PROCEDURES 241

1. Governmental action

2. Field service action

3. Vendor follow-up action."

This paragraph of 88 words can be reduced to a much shorter para-
graph of 36 words, as shown below, without losing any of the original
meanings. This results in improved style and clarity:

"Extremely critical items requiring immediate expediting. The
stockroom expediter will contact the delivery group personally
or by telephone. Discussion will determine the extent of
vendor expediting required (governmental, field service, or
vendor follow-up action)."

Active voice

When language is alive, packed with action, it is easier to read and is
more effective. One aid to getting action in your sentences is to use the
active voice of the verb rather than the passive voice. To illustrate:

"The report will be prepared by the group supervisor," is
written in the passive voice.

"The group supervisor will prepare the report," is written
in the active voice.

Other things being equal, the active voice is to be preferred to the
passive voice. However, the active voice puts the emphasis on the per-
former whereas the passive voice places the emphasis on the recipient
of the action or the thing being acted upon. Therefore, if it is desired
to emphasize the thing being acted upon or the recipient of the action,
the passive voice should be used.

The passive voice is frequently used to create impersonality in re-
ports and procedures. Since excessive use of the passive voice creates a
weak composition, this practice should be avoided.

Short declarative sentences

Short declarative sentences read easily and are easy to understand.
They are preferable to long sentences with many modifying phrases
and clauses which tend to weary and confuse the reader. Compound
and complex sentences should be avoided when simple ones will con-
vey the same meaning.

For instance, read the following one-sentence paragraph:

"Although the production-control department has been hav-
ing difficulty releasing its parts fabrication orders on schedule
because of the inability of several vendors to meet promised

242 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

delivery dates and because of the recent overload of the facili-
ties of the incoming inspection department, the situation has
been improved in the past two weeks by the institution of a
new expediting procedure and by redistributing the responsi-
bilities of the various departments of the inspection division."

Now read it as revised below:

"The production-control department has been having diffi-
culty releasing its parts fabrication orders on schedule. This
has been caused by the inability of the several vendors to
meet promised delivery dates as well as the recent overload
of the facilities of the incoming inspection department. Insti-
tuting a new expediting procedure and redistributing the re-
sponsibilities of the various departments of the inspection
division have improved the situation these past two weeks/'

Although the revised version is still not composed entirely of short
declarative sentences, it is decidedly more readable than the original.

Itemizing the clauses

At times it is impractical to use many simple sentences in place of
a compound one. Consider the following :

"The section supervisor will check the calculations on the
Data Sheet, fill out a Piecework Card, clip the Piecework Card
to the Data Sheet, record the rate on the Payroll Record Card,
and initial the Labor Voucher."

Rather than attempt to break this one-sentence paragraph into five
simple sentences, the efficiency of the paragraph can be improved by
itemizing the actions:

"The section supervisor will:

1. Check the calculations on the Data Sheet.

2. Fill out a Piecework Card.

3. Clip the Piecework Card to the Data Sheet.

4. Record the rate on the Payroll Record Card.

5. Initial the Labor Voucher."

Parallel sentence structure

Clarity is promoted by the use of parallel sentence structure and
words to express ideas which are parallel in nature. Let us consider
several examples of this principle.

"The Washington Sales Office will issue FOP forms when
estimates are requested whereas K O P forms will be issued
by the Chicago Sales Office when estimates are requested."

WRITING SYSTEMS REPORTS AND PROCEDURES 243

If the important elements in this sentence are the different forms,
then parallel structure and the proper emphasis are given by the fol-
lowing revised version: "F O P forms will be issued by the Washington
Sales Office when estimates are requested whereas K O P forms will be
issued by the Chicago Sales Office when estimates are requested/'

"The systems department will determine the requirements
for additional office space and whether air-conditioning should
be installed."

An obvious improvement to give parallelism is: "The systems depart-
ment will determine the requirements for additional office space and
the necessity for air-conditioning."

"The receiving department will stamp the move ticket and
it will then be forwarded to the accounting department."

This is easily transposed to a sentence with parallel construction:
"The receiving department will stamp the move ticket and will forward
it to the accounting department."

The sentence, "Inventory control has and continues to be a critical
function," not only violates the principle of parallelism, but is incorrect.
The verb has is incomplete. The sentence should read: "Inventory con-
trol has been and continues to be a critical function."

Independent clauses

When using a complex sentence, the independent clause gets most of
the emphasis and should therefore transmit the more important ideas.
Let us consider the following sentence:

"The plant manager conferred with his department chairmen on the
quality-control problem, resulting in agreement on a new system for
insuring adequate control."

The independent clause is underlined by a solid line and the sub-
ordinate clause by a dashed line. Since the agreement on a control sys-
tem is the principal idea in the sentence, it would read better as:

"As the result of a conference of the plant manager with his depart-
ment chairmen on the quality-control problem, agreement was reached
on a new system for insuring adequate control."

Or, better still, substituting a simple sentence for a complex one:

"Agreement was reached on a new system for solving the quality-
control problem at a conference of the plant manager with his depart-
ment chairmen."

244 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Logical placing of clauses and phrases

Clarity in the written word requires conformance to the logical rela-
tionships of the language. When the customary relationships are vio-
lated, a mental disturbance is created in the reader which is not con-
ducive to the rapid transmission of ideas. In addition, many misinter-
pretations may result from non-conformance to established usage.

To illustrate some of the hazards involved in the violation of the
logical conventions of the language, the following two samples of more
common deviations from correct usage are presented.

"Having completed the testing cycle, the equipment was released for
shipment by the inspector." Although the clause, "having completed
the testing cycle," modifies "inspector," it is placed adjacent to "equip-
ment." It would be clearer to say, "Having completed the testing cycle,
the inspector released the equipment for shipment."

"Before signing move tickets, it is required that each supervisor care-
fully read the tickets and check the stock record." What word does the
clause "before signing move tickets" modify? It modifies "supervisor"
but is placed adjacent to "it." A better arrangement would be: "Before
signing move tickets, each supervisor is required to read the tickets
carefully and check the stock record."

Punctuation and capitalization

The conformance to standard punctuation and capitalization prac-
tice in procedures and reports is considered desirable because it aids
comprehension. Some standard recognized authority should be fol-
lowed. In all cases, consistency should be maintained. If a word is
capitalized in one place, it should be capitalized throughout the report
or procedure.

The writer has attempted in these last several pages to signal for the
reader's attention some considerations which may help to promote the
clarity and understandability of his reports and procedures. Many addi-
tional aspects which might be discussed with profit are being omitted
for the sake of brevity.

MEASURING THE EFFECTIVENESS OF WHITING

Mr. Rudolf Flesch, in his very interesting treatises on effective writ-
ing,* succinctly states his recipe for understandability: "Talk about
people in short sentences with many root words." Mr. Flesch's yardstick

* Rudolph Flesch, The Art of Plain Talk, Harper, 1946; The Art of Readable Writ-
ing, Harper, 1949; and "A New Readability Yardstick/' Journal of Applied
Psychology, Vol. 32, No. 3, June 1948.

WRITING SYSTEMS REPORTS AND PROCEDURES 245

for measuring readability or comprehension difficulty is based on the
three elements in this recipe:

1. How short are the sentences?

2. How many prefixes, suffixes, and inflectional endings have been
added to the roots of the words used in the sentences? What is the
average number of syllables per word of text?

3. How many personal references nouns with natural gender, per-
sonal pronouns except those that refer to things and not to people?

This third yardstick measures human interest more than readability.
However, the human interest will increase the reader's attention and
his motivation to continue reading. Mr. Flesch later adds a fourth
human interest yardstick to test conversational quality or story interest:
How many personal sentences? How many spoken sentences marked
by quotation marks or otherwise? How many questions, commands,
requests, and other sentences directly addressed to the reader? How
many exclamations and grammatically incomplete sentences whose
meaning has to be inferred from the context?

POTENTIAL EFFICIENCY OF A REPORT

A written procedure or a systems report can only be as good as the
proposed system it presents. If the procedure or report performs its
function perfectlywith 100 percent efficiency then it is exactly as
good as the proposal itself. If the proposal will accomplish only 50 per-
cent of what it should, then the perfectly written report rates only
50 percent.

Although the report can be only as good as the proposed system, this
maximum may not be obtained. Thus, if a perfect proposal which
should be rated 100 percent is written and presented poorly so that
only 50 percent efficiency of communication results, the report will
rate only 50 percent.

Which is the greater tragedy: a good system poorly presented or a
poor system well presented?

The answer to this question might be debated for many hours. The
important point to remember in systems work, as in all activities, is that
the best ideas are of no consequence unless they are accurately trans-
mitted. If they are inaccurately transmitted, these same ideas may
prove very harmful.

246 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

APPENDIX

CAMDEN PLANT PROCEDURE

Iuu*d by: SYSTEMS GROUP

INDUSTRIAL ENGINEERING DEPARTMENT

No. 1*30-02
Page 1 of 7
pate k-lk-b5 _ . Effective k-lk-k5 Supersedes 12-18-Mi

Classification Cost Estimating

Subject COST ESTIMATE; REQUEST. PREPARATION. AND DISTRIBUTION

Scope;

This Procedure outlines the flow of cost estimating information. It
establishes the method for:

1. Requesting a Cost Estimate from the Cost Estimating and Standards
Section

2. Obtaining cost information for estimating purposes

3. Distributing the Cost Estimate.

The provisions of this Procedure are hot applicable to Record Manufactur-
ing.

I. DEFINITIONS

A Cost Estimate is a determination of the cost of a production part, sub-
assembly or complete equipment, regardless of vhether used for sales
quotation, billing, or planning purposes.

II. RESPONSIBILITY

The Cost Estimating and Standards Section of the Plant Accounting Depart-
ment is responsible for making all authorized estimates of production
costs in the Camden Plant. Estimates compiled by other sections for any
purpose must be approved by the Cost Estimating and Standards Section
prior to submission to any person, department, or agency.

III. INTTIATIPN OF REQUEST FOR COST ESTIMATE FORM

The following groups are authorized to initiate a Request for Cost
Estimate in accordance with the procedure herein established. All re-
quests must carry a proposition number assigned by initiator, in accord-
ance vith Camden Plant Procedure #1^50-01, "Proposition Numbers".

A. Commercial Organization

1. The Engineering Products Department may initiate Requests for
Cost Estimate to obtain costs on parts and/or equipment to be
manufactured at or subcontracted from, the Camden Plant, for
quotation to outside agencies and to obtain estimates of
maximum expenditures on a Letter of Intent.

The Request vill be sent to Product Manager involved. When no
Product Manager has been assigned to the type of equipment
involved, the Request will be sent to the Supervisor of the Cost
Estimating and Standards Section.

WRITING SYSTEMS REPORTS AND PROCEDURES

247

Date

Effective

No, 1^0-02. _
Page 2 of

__Supersedes_

Classification^
Subject

2. Industrial and Sound Department (same as A-l).

3. Radio, Phonograph, and Television Department (same as A-l).

U. The Spare and Replacement Parts Section of Tubes and Equipment
Department may initiate a Request for Cost Estimate for costs on
spare or replacement parts for quotation to outside agencies.

A Request for Cost Estimate on complete Master Items (Mi's) will
be sent to the Product Manager. A Request for Cost Estimate for
parts or assemblies (except complete Mi's or equipments) vill be
sent direct to Cost Estimating and Standards Section.

Special Replacement Parts Procedure - When replacement parts are
ordered on a Direct-to-Works Requisition Sheet, usually to be
produced at the same time as the entire equipment, a special
estimating procedure will be f olloved, as outlined in Section VII
of this Procedure.

B. International Activities (same as A-l).

C. The Subcontracting Section of the Procurement Department may initiate
a Request for Cost Estimate to obtain costs for billing purposes on
parts and/or equipment shipped to a subcontractor from the Camden
Plant. The Request will be sent to the Product. Manager.

D. The Accounting Department, may obtain estimates on parts and assemblies
for billing and other purposes by following the special procedure
outlined in Section VIII of this Procedure.

E. The Product Manager may initiate a Request for Cost Estimate:

1. For costs x on parts supplied by Camden to other RCA Victor Division
Plants.

2. To obtain costs requested by any department of Camden Plant for
planning and comparison purposes.

In all these cases, requests will be sent to Cost Estimating and
Standards Section.

IV. ENGINEERING DEPARTMENT COPY OF COST ESTIMATE REQUEST

One copy of each Request for Cost Estimate (except those originating in
Subcontracting Department) will be sent to the proper Engineering Depart-
ment by the person who sends the Request to the Cost Estimating and
Standards Section.

248 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Date: U-1U-U5 No.-

Page 3 of 7

V. ESTIMATING PROCEDURE

A. Product Manager

1. Upon Receipt? of a request from a department of the Camden Plant
to initiate a Request for Cost Estimate for planning purposes,
the Product Manager will first ascertain that the cost informa-
ti6n desired is acjbually required. He will then initiate a.
Request fr Cost Estimate and send to the Cost Estimating and
Standards Section, and to the proper Engineering Department*
with any additional information which will be of value in
estimating.

2. tfpon receipt of a Request for Cost Estimate from the Commercial
Organisation or the Subcontracting Section of the Procurement
Department, the Product Manager will review the item requested
to make sure that it is practical from a manufacturing and load
Standpoint and in accord with RCA manufacturing policy. He will
indicate whether equipment is to be manufactured at the Camden
Plant or subcontracted. If it is to be manufactured, the
section in which it is planned to assemble the equipment will be
indicated, if possible. If it is to be subcontracted, one copy
Of the Request for Cost Estimate .will be sent to the Subcontract-
ing Section. The Product Manager will send the Request for Cost
Estimate to the Cost Estimating and Standards Section with any
additional information which will be of value in estimating.

A copy will also be sent to the proper Engineering Department and
to the Equipment Planning and Scheduling Section.

3 Upon receipt of the subcontracting cost data (Section V-A-2)

from the Subcontracting Section, the Product Manager will forward
thia data to the Cost Estimating and Standards Section.

&. Upon receipt of three copies of a Request or Cost Information on
crystal units in an equipment from the Equipment Estimating
Group (Section V-B-1), the Crystal Product Manager will send one
copy to the Engineering Department and one copy to the Crystal
Cost Estimating Group.

5. TfcO Crystal Product Manager will receive f<5ur copies of the
Crystal Cost Estimate (Sectien V-B-3). After approving the
Co$t Estimate, the Product Manager will forward a copy to each
of the following groups:

a. .Equipment Cost Estimating G?ou

b. Commercial Organization
C. Engineering Department

B. C0<t Estimating and Standards Section,

1. Upon receipt of Request for Cost fi-stisate from an authorized
source, the Cost Estimating and Standards Section will request
cost information from other departments of the Camden Plant in
following manner:

A. Procurement Department - send a Request for Purchased Parts

WRITING SYSTEMS REPORTS AND PROCEDURES 249

Date: k*lk*b5 NO. 3.1*50-02

_ . Page k of 7

to the Procurement Department for costs of purchased parts.

to, All other departments - send a Bequest for Coat Information
to all other departments from which cost information is
required.

When the equipment contains crystal units, the Equipment Cost
Estimating Group vl.ll send three copies of a Request for Coat
Information to the Crystal Product Manager and one copy to tfcS
Commercial Organization.

2. If parts -are to be obtained from other RCAVD plants, a Request
for Costs will be prepared and sent to the Product Manager of
the plant involved. If no Product Manager has been assigned to
the type of equipment Involved, the Request for Costs vii} too
eent direct to the Cost Estimating Section of that Plant*

$. Upon receipt of a Request for Cost information from the Cfystai
Product Manager and engineering cost information from the
Engineering Department, the Crystal Cost Estimating Group
will prepare a Cost Estimate for the crystal wits and forward
four copies to the Crystal Product Manager.

k. Upon receipt of the cost information requested, the Cost Estia&t*
ing and Standards Section will:

a. Prepare a cost estimate on Cost Estimate fofrn, except

estimates of expenditures on Letters of Intent, which will tod
prepared on Standard Letter Form. Distribute as outlined in
Section VI of this Procedure .

to. Prepare a Price Analysis Summary for all cost estimates
except estimates of expenditures on Letter of Intent.
Distribute as outlined in Section VI of this Procedure.

When crystal units are contained in an equipment, they wi],X appsftf
as a separate item on both the Cost Estimate and Price Analysis
Summary-

C. Engineering Departments

i. Upon receipt of copy of Request for Cost Estimate, the Engineering
Department involved will:

a. Prepare adequate engineering information for estimating cost
of the equipment and/or parts involved and forward to the Cost
Estimating and Standards Section and to the Assembly Planning
and Scheduling Section.

to. Prepare engineering cost information Oft .Engineering and

Drafting Estimate form. The cost and quantity of instruction
books and engineering facilities, together with list of tube
complements must be included with the estimate. Send to the
Cost Estimating and Standards Section and to the Assembly

250 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Date: 4-1^5 No. 1^50-02

Page 5 of 7

Planning and Scheduling Section.

c. If equipment is to be subcontracted, send adequate engineer-
ing information for obtaining quotations on equipment to
the Subcontracting Section.

2. Upon receipt of a Bequest for Cost Information on crystal units
in an equipment from the Crystal Product Manager (See Section
V-A-4), the Engineering Department vill send engineering cost
information for both the crystal and crystal holder to the
Crystal Cost Estimating Group.

P. Subcontracting Section of Procurement Department

Upon receipt of a Bequest for Cost Estimate from the Product Manager,
the Subcontracting Section will obtain one or more quotations for the
items from subcontractors, plus any additional information required
by the Cost Estimating and Standards Section. This information will
be sent to the Product Manager.

E. Procurement Department

Upon receipt of a Request for Purchased Parts from the Cost Estimat-
ing and Standards Section, the Procurement Department vill prepare
the required cost information and return one copy to the Cost
Estimating and Standards Section.

F. All Other Departments of Camden Plant

Upon receipt of a Request for Cost Information from the Cost
Estimating and Standards Section, the section receiving the request
will prepare the cost information required and send it to the Cost
Estimating and Standards Section and to the Equipment Planning and
Scheduling Section.

VI. DISTRIBUTION OF ESTIMATES

A. Estimate Requested by Commercial Organization

1. All except estimates of expenditures on Letter of Intent:

a* The Cost Estimating and Standards Section will send one copy
of the Cost Estimate, one copy of the Price Analysis
Summary (Price Analysis Summary not required for replacement
parts), and an Approval Card to the Product Manager.

b. Upon return of the signed Approval Card and Price Analysis
Summary from Product Manager, the Cost Estimating and
Standards Section will:

(1) Send three copies of Price Analysis Summary and
Commercial Organization copy of Cost Estimate to
Price Accounting Group of General Accounting Department.

WRITING SYSTEMS REPORTS AND PROCEDURES

2SI

Date:

No. 1^50-02
Page 6 of 7

(2) Send a copy of the Cost Estimate to one of the follov-
ing sets of departments, depending on the nature of the
proposition:

(a) Non-restricted, restricted, or confidential

1) Equipment Planning and Scheduling Section

2) Engineering Department

3) Plant Accounting Department
k) General Accounting Department

(b) Secret

(1) Engineering Department

(2) Plant Accounting Department

2. Estimates of maximum expenditures of Letter of Intent:

a. The Cost Estimating and Standards Section vill send three copies
of the Standard Letter to the Price Accounting Group, vho will
distribute a copy to the Commercial Organization and to the
Divisional General Counsel.

b. The Cost Estimating and Standards Section vill send a copy of the
Standard Letter to one of the f olloving sets of departments,
depending upon the nature of the Letter of Intent:

(1) Non- restricted, restricted, or confidential

,) Equipment Planning and Scheduling Section
) Engineering Department
Plant Accounting Department
General Accounting Department
(Commercial Organization
Plant Manager
g) Product Manager

(2) Secret

(a) Engineering Department

(b) Plant Accounting Department

(c) Commercial Organization

B. Estimates Requested "by Subcontracting Section of Procurement
Department

The Cost Estimating and Standards Section will send four copies
of the Cost Estimate to the Subcontracting Section and one copy
to the Product Manager and to the Plant Accounting Department.

C. Estimate Requested by Product Manager

The Cost Estimating and Standards Section vill eend tvo copies
of the Cost Estimate to the Product Manager, and one -copy to the

252 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

Date: fc-lk-U5 No. 1^50-02

Bage 7 of 7

Plant Accounting Department, and one copy to the Engineering
Department.

YXI. BHCIA1 HSmCEMSNT PARTS ESTIMATING PROCEDURES

The folloving procedure vill be followed for estimating the costs of
replacement parts ordered on a Direct- to-Works Requisition (KTW).

A. Three copies of the DTW issued by the Replacement Barts Section
vill be cent to the Cost Estimating and Standards Section.

B. The Cost Estimating and Standards Section vill estimate the
costs of the parts ordered on the DTW.

C. The cost estimates vill be typed on the DTW in line vith the part
description. One copy vill then be sent to Replacement Parts
Section and one copy to Plant Accounting Department.

VHI. BPBCIAL XKOCEDDRE FOR COSTS REQUIRED BY THE PIANT ACCOUNTING EEPARTMENT

Vhen a section of Plant Accounting Department requires cost on parts and
assemblies for Tbllling and other purposes, it vill request these costs
from the Cost Estimating and Standards Section in vritlng. The Cost
Estimating and Standards Section vill supply the requested information
in vriting .

EC. C06T ESTIMATE FOLLOW-UP

tlpon receipt of a DTVf from the Equipment Planning and Scheduling Section,
the Cost Estimating and Standards Section vill check it against the
applicable cost estimate. If the quantities or contents on the DTW do
not agree vith. those used in the cost estimate, a nev estinato vill be
toade. The estimated costs vill then be placed on Cost Comparison Card
. and one copy sent to the Cost Accounting Section of the Plant Accounting
Department.

WRITING SYSTEMS REPORTS AND PROCEDURES 253

DISTRIBUTION
All holders of Camden Plant Procedures JManuals plus:

H. S. Hemingway 8-5 2057 Central Planning

F. J. Herrmann l|-5 2069 Equipment Assembly

H. Hannum 10-R 2292 Plant Accounting

F. J. Holmes 8-5 919 Plant Accounting

T. R. Sykea 10-2 802 Plant Accounting

F. W. Watkinson 8-5 1^9 Plant Accounting

N. Barish 8-5 ^27 Industrial -Engineering

FORMS, INVOLVED

Request for Cost Estimate - #12859

Request for Purchased Parts - #1189^

Request for Cost Information - #B257T

Request for Costs - #12812

Engineering & Drafting Estimate - #19885 and #25913-2

Cost Estimate - #18262

Price Analysis,- Summary - #10859 and B21^T or 2C4& 2C5

D.T.W. - #11395

Purchase Order - #BUD5

Cost Comparison Card - #107 1 *-9

ASSOCIATED PROCEDURES
PROPOSITION NUMBERS, BLOCK ASSIGNMENT OF #1^50-01

INDEXING

This Procedure is to be indexed as follows:
COST ESTIMATE: REQUEST, PREPARATION AND DISTRIBUTION
ESTIMATE (COST): REQUEST, PREPARATION AND DISTRIBUTION

Please post to your Indent for easy reference.

XII

INSTALLING THE SYSTEM

EXISTING SYSTEM has
been thoroughly and systematically examined; the best alternative has
been determined and the detailed procedure designed; a report of the
entire investigation has been prepared; management has approved the
new system and the supervisory and operating personnel have been
sold on the new procedures. The next step is the installation of the
improved system.

The methods and thoroughness of installing the system may deter-
mine the success of the improvement, especially in the early stages of
operations under the new system. If the groundwork for the new sys-
tem has not been properly prepared; if the personnel have not been
properly trained; if the installation timetable is poorly arranged; if
understandable and concise instructions have not been issued; if the
period of overlap between the old and the new has not been provided
for; then the best improvement will fail.

The installation should therefore be logically planned well in ad-
vance of the changeover. The timetable and the installation methods
should be outlined in detail to insure complete and effective results.

254

INSTALLING THE SYSTEM 255

METHODS OF INSTALLATION

There are four principal approaches in installing a new, improved
system:

1. Install critical parts of the system on a tentative trial basis to test
its effectiveness.

2. Install the entire system on a tentative basis and at the same time
retain the old system running concurrently.

3. Install the entire system in one small unit of the company as a
pilot plant, replacing the old system only in this company unit.

4. Install the new system to replace the old system in its entirety. The
timetable to accomplish this installation covers as short a period of
time as is possible without disturbing normal operations too severely.

Each of these methods has advantages and disadvantages and is best
suited to varying situations. The first three approaches involve a trial
approach to reveal and eliminate any minor kinks in the new system
before it is fully applied. If it is necessary and desirable, the testing of
critical aspects of the system on a trial basis should generally be done
prior to the decision to adopt. It is essentially a part of the systems
investigation in most cases. Installing the new system to run parallel
to the existing one may provide a good basis for comparison of the
systems. However, it is a costly procedure and may pose a personnel
problem because of the two sets of employees required, one of which
will be eliminated eventually.

The pilot-plant installation system may be very valuable where
applicable. In the vast majority of cases, similar, independent units
are not available for pilot-plant installation and, even if available, are
not always necessary. However, they can provide valuable experience
for refining the details of a complicated system when the opportunity
for such an installation procedure is present.

Direct installation of the new system is the most usual and most
logical procedure in most cases. Various segments of the system may
be installed in succession or simultaneously, depending upon the cir-
cumstances. The installation timetable should make allowance for the
training and learning time required for adapting the workers to the
new routines.

TOANSCRIBING TO NEW RECORDS

It is sometimes necessary to transcribe some historical information
from the old record-keeping system to the new record. This task may

256 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

be relatively time-consuming and arduous. It will not usually be prac-
tical to expect the regular record keepers to transcribe this backlog
as well as keep up with the current volume unless the change can be
made during a period of low volume of work.

If the volume of work is not too great, it might be advisable and
most economical to have this setting-up work done by the same em-
ployees on an overtime basis.

If this is not feasible because of the large amount of overtime which
would be required and the length of time which the task would take,
then it might be possible to borrow some personnel from other depart-
ments for a short period of time. This would be especially practicable
if the installation could be timed to coincide with the period of un-
seasonal activity in the other departments.

Another source of aid in this installation work is an outside clerical
agency. A number of enterprises have been established in recent years
which will provide a staff of clerical workers to handle peak-load
operations such as this. A competent clerical crew provided by a reliable
agency may sometimes be the answer.

Of course, if the nature of the installation is such that the changeover
will cover a relatively long period of time, it may prove most practical
to employ one or more persons on a temporary basis to perform the
task.

TRAINING PRINCIPLES

The methods of training the worker will vary widely. Different types
of work and the varying abilities and aptitudes of the workers will
dictate differing methods. Some general principles of teaching and
learning are nevertheless applicable to all training methods.

The tasks should be divided into logical entities and then each of
these should be taught as one complete unit, rather than break these
entities into smaller parts. It is easier to learn a whole motion pattern
rather than learn each part of the pattern separately and then integrate
the parts into the whole pattern. It is generally more effective to teach
the entire operation of a clerical task as a whole rather than attempt
to obtain facility with each segment separately and then integrate the
segments into the entire operation.

Training is made more effective when the worker's interest is aroused.
The best methods of arousing the worker's interest and stimulating his
attention will vary in each circumstance.

The learning process is greatly facilitated when associations from

INSTALLING THE SYSTEM 257

past skills and knowledge can be used. The memory is assisted when
the old innate reactions or procedures can be transferred, with neces-
sary changes, to the new task.

The analyst should never talk down to the worker or give evidence
of any kind of irritation or boredom to those who may be slow in
learning. Any such actions are bound to create undesirable reactions
in the worker which may make the learning rate even slower.

Patience should always be shown to all the workers in learning the
new procedures. Indications of impatience will usually tend to rattle
the worker and defeat the instructional purposes.

It is generally preferable to concentrate on accuracy first and allow
the speed to develop as the skill increases. If speed is initially attained
at the expense of accuracy, it is usually exceedingly difficult to elimi-
nate the early habits of inaccuracy.

As many of the organs of sensory perception should be brought into
play as possible. The worker should hear how it should be done; see
how the expert demonstrates it; and, under supervision, feel how he is
supposed to do it himself. As much as possible, the instruction should
train and use the senses.

It is important that the worker be observed closely in his initial
performances of the new procedures to insure that he follows the
desired methods. Errors or bad habits are best discovered early if they
are to be rapidly corrected.

The instructional sessions are usually more effective if they are
relatively short and numerous rather than one or several long, con-
tinuous periods. Breaking up the training periods into short sessions
gives the worker a chance mentally to digest the material as well as to
recuperate psychologically from the struggle of learning. It enables
the learner to be in a refreshed state of mind more frequently. Dis-
tributing the teaching and practice has been found generally to pro-
mote more rapid learning.

TRAINING TECHNIQUES

Utilizing these learning principles, the employees may be trained,
using various combinations of industrial training techniques. The cor-
rect emphasis will be dependent on the nature of the work and per-
sonnel. Mr. W. H. Leffingwell explains six phases in the training of
clerical workers to perform their duties correctly: *

* From Handbook of Business Administration, edited by W. J. Donald. Copyright
1931. Courtesy of McGraw-Hill Book Co.

258 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

1. The actual work to be done must be explained to the worker in a
manner that will thoroughly impress him with (a) the purpose of the work;
(b) the relation of the operation to other work; (c) the relative importance
of the various details of the job; and (d) the manner in which it is to be
done. This is the beginning of all training, and there are perhaps more com-
panies who take this step than will be found taking the rest of them. But
it is only the beginning, and nothing remarkable can be accomplished by
stopping there.

2. The best arrangement of the work and the work place should be
taught. If every job is carefully studied, it will be found that there is always
one particular way of arranging the work and the work place that is far
superior to the others. But this is a matter which can only be determined
by deliberate study; one cannot "just naturally" pick it up, and if left to his
own devices the clerk will usually adopt a clumsy arrangement. Many man-
agers, though observing this, hesitate to suggest a change, on the assump-
tion that a person will work better with his own arrangement than with any
other, which is of course an unfounded idea.

3. The best motions constitute the next step, and they can only be found
by the most careful analysis of the work to be accomplished, the nature of
the motion required, the element of fatigue, and so forth. Occasionally a
worker will, of his own accord, develop a superior way of performing a
certain motion, but rarely indeed does one worker develop all of the best
motions in an operation. A study of the various methods used at present
by different workers will be found suggestive, but ordinarily the observer
will be compelled to use his own ingenuity.

4. The next step to be taught is the correct sequence of the motions at a
standard rate of speed. Gilbreth has shown that fast motions are different
from slow ones, and if one is definitely to learn the right motions, he must
at the same time learn to perform them at a standard rate of speed.

5. While the fourth step is being learned, the habit of speed must be
developed. For it is strictly a habit. Some people acquire it more readily
than others, but all must learn it.

6. Accuracy must also accompany the last two steps, but its final develop-
ment may be completed after the habit of performing the right motions in
the right sequence, and at a standard rate of speed, has been acquired. The
worker must be taught the points at which accuracy is of the greatest im-
portance, and also where extreme accuracy is not required. The meticulous
clerk is often more of a liability than an asset.

Some formal classroom or conference instruction may be desirable
to acquaint the workers and the supervisors with the new procedures.
These classes will normally be held during working hours. If classes
meet after hours, supplementary employee compensation may be desir-
able. The first step is to write down in detail the material and skills to

INSTRUCTIONS FOR POSTING SHOP ORDER STATUS RECORDS

THE SHOP ORDER -STATUS RECORD

THIS KIND OF

SHOULD BE POSTED LUCE THIS:

MEANS THAT

THIS TRANSACTION HAS OCCURRED, AMD

Column to

Color

Add or

be Posted

of Ink

Subtract

Sheet

stallatlon In equipment

Dlabursemcnts

Black

Add

1. Assembly baa returned purchased parts to P.M.I, to be re-

Receipts

Red

Subtract

inspected or to be returned to the Vendor.

and

(both

(both

Disbursements

columns)

columns,)

Credit

or

Memo

2. Assembly haa returned parts to the Accumulation stockroom.

Disbursements

Red

Subtract

C.M.

3. P.M.I, has returned to the Accumulation stockroom parta

Receipts

Black

Add

which were sent to be reinspected or returned to vendor.

I. Parts have been received on a diversion from another ohop

Receipts

Black

Add

order.

(Note In red

in Diversion

Material

column)

Ticket

previous diversion loan.

Receipts
(Note in black

Black

Add

or

in Diversions

column)

3. Parta have been disbursed on a diversion to another

Receipts

Red

Subtract

ehop order.

(Note la black

D.T.

or

In Diversions

column

U. Parts have been disbursed aa repay of a previous diver-

Receipts

Red

' Subtract

sion loan.

(Note In black

in Diversions

column)

1. Accumulation stockroom haa received fabricated or

Receipts

Black

Add

Material

Component parts from Parta Fabrication or Component

Forwarding

Parts Department.

Ticket

or

F.T.

2. Assembly section has cent parts to a manufacturing de-
partment for repair.

Receipts
and

Red
(both

Subtract
(both

Disbursements

columns)

columns)

-

Warehouse (alao received on copy of M.O.C.).
or

Receipts

Black

Add

Add

Material
Requisition
Ticket

M.H.

to cover shortages.
3. Accumulation stockroom has sent parta to subassembly.

Black

Add

which will return them under a subassembly number.

or

U. Accumulation stockroom haa returned purchased parts to

Receipts

Red

Subtract

or

!>. Accumulation stockroom has returned parts to a manufac-

Heceipto

Red

Subtract

turing section to be repaired.

6. Accumulation stockroom has returned parts which it re-

Receipts

Red

Subtract

Receiving

Accumulation stockroom has received purchase parts from. P.M.I.

Receipts

Black

Add

Sheet

Report of Re-

Receipts

Bed

Subtract

ject Material

Assembly section has scrapped parta.

and

(both

(both

Scrapped

Disbursements

columns)

columns)

R.M.S.

P.O.C.

The Accumulation stockroom has received parts from the Ware-
house (alao received on Material Requisition Ticket).

Receipts

Black

Add

BKJKCTS

When parto are rejected on a Credit Memo, a Material For-
varding Ticket, or a Material Requisition Ticket, add "R"
to the reRular ticket symbol entered in the ticket number

Examples:

OHR 89175 Parts rejected ou Credit Memo #89175

FIR 321*50 " " " Mat'l. Forwarding Ticket

#3^50
MRR 79282 " Mat ' 1. Requisition Ticket

#79262

The following taba vlH be used to show tha statua of dif-
ferent kinds of parts:

1. Blue tab purchased parta

2. Red tab manufactured parta

3. Black tab component parta

In addition, a yellov tab will be placed on a card whenever
& diversion of that part haa been made and repayment has
been promised. The yellow tab will remain on the card un-
til the repayment ia made.

SYSTEMS GROUP

INDUSTRIAL ENGIMERBKJ IKPT.

8-17-W*

Courtesy RCA Victor

Figure 85. Instruction Chart summarizes the routine duties of the posting
clerk using the shop order status record of Figure 63.

260 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

PRESENT VOUCHER

AUDIT SECTION-
JULY

Picture* rep1ac symbol* on this, chart. They help sell
Improvements because they present then more graphically.

U. S. Bureau of the Budget Management

Figure 86. Organizational Flow

be taught in the classes. If all the material can be covered in one short
session which sometimes might very well be the case with the super-
visorsthen a timetable of sessions is not required. Otherwise, a time-
table of relatively short periods (about one hour each) should be
prepared and the material to be covered allocated the required amounts
of time in these sessions.

INSTALLING THE SYSTEM

AUDITING PROCEDURE

FINANCE DIVISION

261

Bulletin "Process Charting"

Chart with pictorial elements.

Unless it has been demonstrated definitely that the workers are
familiar with certain practices or skills, it is advisable to assume that
they know absolutely nothing. Otherwise, two undesirable conditions
may develop if some of the workers do not come up to the assumed
level of knowledge or skill: some of the trainees will not be able to
follow the instruction and will flounder helplessly; or the instructor

262 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION
FLOW-PROCESS CHART

O
Vs

MOV|

INACTIVITY
ACTIVITY IINC

Courtesy Standard Register

Figure 87. Pictorial Forms Distribution Chart. The pictorial elements drama

will have to take unplanned stopgap measures to attempt to bring the
less trained workers up to the assumed level of competence. Better re-
sults will usually be obtained if careful extra training is given at the
start.

The lectures should make use of visual aids and demonstration
techniques as' much as possible. Everything should be prepared in
advance so that there will be a minimum of distracting occurrences
during the periods. Supervised practice sessions are desirable to give
the workers actual practice in the new routines. Pertinent questions
should always be encouraged. An examination may be given to deter-
mine how effectively the material has been mastered and what addi-
tional training is desirable.

Much of the training will be done most effectively at the workplace.
The use of instructional charts, activity analysis charts, process charts,
and operator charts are all helpful in supplementing written and oral
instructions. Process charts, right- and left-hand charts, departmental
flow charts, etc., should be distributed wherever they can increase the

INSTALLING THE SYSTEM

263

POSTS ACCOUNTS

Company of Dayton, Ohio

tize vividly the procedure symbols shown at lower left in the chart.

effectiveness of the instruction. The chart shown in Figure 86 of a
voucher-auditing procedure is an example of an Organizational Flow
Chart adapted for instructional purposes. Figure 85 shows an instruc-
tional chart used in the installation of a new production-control record.
The use of a pictorial flow chart is shown in Figure 88. The pictorial
forms chart of Figure 87 has analytical as well as instructional value.
Continual checking on the performance of the work is desirable in the
early stages of a systems installation to insure that the personnel are
working correctly and to give individual aid and instruction where
required.

The Training within Industry Service of the Bureau of Training of
the War Manpower Commission developed a very excellent program
during World War II. Its outline of the desired essentials of job in-
struction training is very valuable for indicating how to go about
training workers in a new system.*

* "The Training within Industry Report," War Manpower Commission, Washington,
D. C., 1945, pp. 33-34.

264

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

PAYMASTER DISTRIBUTES
PAY ENVELOPES AND

COLLECTS SIGNED ATTEN-
DANCE CARDS.

EMPLOYEES CHECK THE
ACCURACY OF THEIR
ATTENDANCE CARD AND
SIGN IT

INTERPRETED
AND ENCLOSED
WITH THE CASH
IN THE PAY
ENVELOPE.

REPORT Of ATT-
ENDANCE CARDS
COLLECTED.

L'ounvsy lit unity Luit. Rand, Inc.

Figure 88. Pictorial Flow Chart representation of a punched-card procedure.

How TO GET READY TO INSTRUCT

Have a Timetable

How much skill you expect him to have, by what date.
Break Down the Job

List important steps.

Pick out the key points (safety is always a key point).
Have Everything Ready

The right equipment, materials, and supplies.
Have the Workplace Properly Arranged

Just as the worker will be expected to keep it.

INSTALLING THE SYSTEM 265

How TO INSTRUCT

STEP 1- Prepare the Worker

Put him at ease.

State the job and find out what he already knows about it.

Get him interested in learning job.

Place in correct position.
STEP 2 Present the Operation

Tell, show, and illustrate one Important Step at a time.

Stress each Key Point.

Instruct clearly, completely, and patiently, but no more than

he can master.
STEP 3 Try Out Performance

Have him do the job correct errors.

Have him explain each Key Point to you as he does the job
again.

Make sure he understands.

Continue until You know He knows.
STEP 4 Follow Up

Put him on his own. Designate to whom he goes for help.

Check frequently. Encourage questions.

Taper off extra coaching and close follow-up.

If Worker Hasn't Learned, the Instructor Hasn't Taught.

Part IV

MANAGEMENT OF THE SYSTEMS TECHNIQUE

XIII

THE SYSTEMS-CONTROL FUNCTIONS-
ORGANIZING A SYSTEMS DEPARTMENT

HAVE CONSIDERED

in some detail in the previous chapters the principles and methods
used in systems and procedures analysis. But we have not spoken about
the persons who perform this important function. Where should the
systems functions be located in the organization? How should they be
performed? How should a systems department be organized and oper-
ated? What are the desirable qualifications for systems work?

The purpose of the systems functions is to promote the use of the
best systems in the operations of the organization: to enable the organ-
ization to achieve its objective with the greatest efficacy, at the
lowest cost, and in the shortest possible time. To achieve this objective,
a number of related systems activities are performed. These activities
in the systems department are designed to facilitate systems investi-
gations; to provide mechanisms for controlling and coordinating the
enterprise's systems; and to promote better performance and evaluation
of the systems functions.

267

268 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

ORGANIZATIONAL LOCATION

There is much disagreement about the best place in the organiza-
tional structure to locate the systems function. There is also consider-
able controversy as to whether the systems function should be cen-
tralized or decentralized.

Historically, the accountants were the first group interested in sys-
tems and the first written procedures were accounting instructions.
These accounting instructions usually established the account and de-
partment numbers and usually prescribed the paperwork routine nec-
essary for accumulating the desired cost information. However, it was
the industrial engineers rather than the accountants who developed
many of the analytic techniques used in systems work. But until com-
paratively recent years, the industrial engineers had concentrated their
talents on the direct manufacturing operations. It was in connection
with this methods work that they developed process charts, principles
of motion economy, etc.

Today, the systems function has much broader objectives than it did
years ago and its techniques have been expanded and sharpened. The
organizational arrangement and position of the systems function is of
considerable importance in determining the success of itsjperformance.

Should each product line or division have its own systems depart-
ment? To whom should the function report? Present practice of the
companies having separate units for performing systems functions
varies considerably. Centralized, decentralized, and combinations of
both types of functional allocations are used. These systems units fre-
quently report to the accounts and finance director, to the chief engi-
neer, or to the head of the industrial engineering department.

For effectiv%j>erformance of the systems function, there is much
logic in having the systems department as a staff unit reporting to the
top executive of the company. Since the systems function provides the
vehicle for effectuating managerial policy, it should be as close as
possible to the sources of the managerial directives if it is to interpret
them correctly and quickly insure that they are carried out. The sys-
tems function should be as independent as possible of pressure from
particular groups in the enterprise. These pressures will be fewer and
less violent the higher up in the organization the function is placed.

The systems functions require the analysis and integration of the
relationships between all parts of the enterprise. If these functions are
performed at too low a level in the organization, one of the following
situations may occur:

THE SYSTEMS FUNCTIONS AND CONTROLS

269

1. The systems functions are decentralized, each group having author-
ity within its own area only, as shown in Figure 89.

General Manager |

1 1

\

1

Accounts
& Finance
Division

Transmitters
Oiv/sion

Receivers
Division

Electrical
Components
Division

Engineering
Division

^Systems \^ \ Systems^ \ Systems J

Figure 89. Although the three product divisions each have sepa-
rate systems departments, coordination is difficult in this arrange-
ment and some divisions have no systems department.

In this arrangement, the problem of coordinating those activities
which cross division lines is difficult. Also there are some divisions
with no systems units. The low placed systems department may
have trouble coordinating functions having interdivisional flows.
2. The systems functions are centralized in one division which services
all the other divisions as well (Figure 90). In this arrangement, the

|_ General Manager

Accounts
Q Finance
Division

Transmitters
Division

Receivers
Division

E/ectrical
Components
Division

'

Engineering
uivision

\ Systems]

Figure 90. The systems department services all divisions of the
enterprise although it reports to the receivers division.

problem of coordination of the activities of the systems departments
of the various divisions is solved. However, the ability of the sys-
tems unit to function in the other division may be impaired because
it reports to the head of one division who may unduly influence its
operating policies.

Neither of these alternatives is ideal. If the systems functions cannot
report to the top man of the enterprise, then placing them in the
accounts and finance division is frequently the next best solution.

270 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

In a very large enterprise, it may be logical to give each major divi-
sion its own systems unit to deal with local problems in addition to
providing a centralized systems unit reporting to the top operating
executive. The centralized unit, close to the sources of managerial
directives and having access to the policy-making individuals of the
enterprise, will coordinate the activities of the local systems units and
provide the general framework for their operations. This central unit
will also be directly responsible for the over-all systems activities which
cross divisional lines. The divisional systems units will be able to give
specialized attention to systems problems in all departments and at
all levels in its division. If properly applied, this plan may supply most
of the benefits of decentralization without sacrificing the major advan-
tages of centralized controls.

IMPOSITION OF DECISIONS

Although the systems department should have the authority to im-
pose its decisions when approved by top management, this authority
must never be exercised over the objections of any of the operating
executives. Systems activities are performed as a service to those
executives who have the primary responsibility forthe successful
operation of their respective departments. The systems department
should aid the executives in carrying out these responsibilities. When
an operating executive disagrees with the systems analyst, agreement
must be reached by logical, good humored, patient analysis and selling.
A system should never be imposed over an executive's objection: the
enterprise, the systems department, and the operating department will
usually all suffer as a result of the bad feeling. In addition, the operat-
ing executive will have been deprived of some of the authority to
which he is entitled if he is to be held completely responsible for his
department's performance.

PERSONNEL ADJUSTMENTS RESULTING
FROM SYSTEMS CHANGES

It should be the policy of the company that persons will not be fired
or laid off because of improved efficiency resulting from systems im-
provements. If any position is eliminated, the person should be trans-
ferred to another activity for which he is qualified. If no such transfer
is possible, some special assignment should be found for the person

THE SYSTEMS FUNCTIONS AND CONTROLS 271

until an opening develops. To promote cooperation of the operating
personnel, it is desirable that the workers in the enterprise do not feel
that their positions are jeopardized by systems analysis.

SUPERVISOR TRAINING IN SYSTEMS ANALYSIS

The application of systems analysis for improving operating routines
should not be restricted to the personnel of the systems department.
Not only should systems analysis have the support and cooperation of
all employees, but special training programs should be organized to
train supervisors in handling day-to-day systems problemsto apply the
principles of work simplification to their daily activities and those of
their subordinates.

A training program for supervisors should, among other things, train
the supervisor to apply the systems-charting techniques in solving his
problems and simplifying clerical routines. Since most supervisors know
more about the work and the jobs in their respective departments, they
are one of the best sources of ideas for increased productivity. When
they suggest, install, and receive credit for the improvements, the
supervisors' incentives in promoting good systems are very great. Be-
cause there are a large number of supervisors in the enterprise in com-
parison with the possible number of systems analysts, the cumulative
effect of possible improvements working through the supervisors may
be quite imposing.

The organization of a systems-training program for supervisors follows
the principles outlined in Chapter XII. The principles and methods of
a program to train supervisors in the use of systems-analysis techniques
are the same as those for instructing the worker in how to operate a
new system.

Prepare for the program by first obtaining the support of all key
personnel. Explain the purpose of the program and discuss all ques-
tions. Schedule the program: which departments will be tacked first
and how much time will be allotted to each group. Then, follow the
job-training outlines. Get ready to instruct by having a timetable for
the acquisition of the skills, by breaking down the job, by having
everything ready and all material properly arranged. Then, instruct by
first preparing the supervisor selling him on the values of the tech-
niques, presenting the systems techniques one step at a time, having
conference problem analyses under supervision, having him make his
own sample analyses which are checked and discussed.

272 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

CONTROLLING THE SYSTEMS FUNCTIONS

The systems functions are in some ways analogous to the highways
of our land the roads of the nation provide the avenues for the flow
of vehicles, persons, etc., and the systems in a company provide the
avenues for the flow of the procedural information, forms, etc., required
for operating the enterprise. Both systems and highways are subject
to the effects of obsolescence and require constant attention to insure
that they are adequate for serving current needs.

A new highway provides a new path for the flow of traffic. To ascer-
tain how effectively this new highway is functioning, the traffic police
patrol the highway and observe the character and amount of usage.
To ascertain how effectively a new system is functioning, the systems
follow-up function is performed by the systems department.

To outline the directions and length and breadth of the highways,
road maps are prepared and distributed. To outline the direction of
the systems paths in the organizational structure, its length and its
breadth, organization manuals and organization charts are used.

To control the operations of the traffic patrols, various assignment
sheets, time cards, accident reports, activity reports, etc., must be main-
tained by the highway police department. To control the activities of
the analysts in the systems department, various projecf controls and
project status and summary records must be maintained by the systems
department.

To define the manner in which the highways may be used, a driver's
manual distributed to all drivers will prescribe acceptable practice.
To define the manner of performance of systems, a procedures manual
distributed to the proper persons will prescribe standard practice.

The highway department has several key indicators for controlling
operations on the highway. When a serious accident occurs, it must be
reported in a specified manner; when a person or organization believes
that the road needs a change in width, the highway department must
be petitioned to study the problem and determine the best solution.
The systems department also has several key devices for controlling
procedural operations. These will be described later: forms control,
lay-out control, and equipment control.

SYSTEMS FOLLOW-UP

The follow-up function of the systems department is so important to
the success of the department's activities that it is hard to conceive of

THE SYSTEMS FUNCTIONS AND CONTROLS 273

its being overlooked. Yet time and time again, this lack of effective
follow-up results in a lack of complete effectiveness on the part of the
systems department.

Follow-up on the completed projects of the department serves many
valuable purposes. It enables the department to determine if its pro-
cedures and recommendations are being followed. If these changes are
not functioning properly, the department may then determine why
they are not being applied. Is it because the supervisor is lax in regu-
lating the work of his group? Is it because the new system was not sold
correctly or sufficiently to the operating personnel? Is it because in-
sufficient instructions were issued in installing the system? Has the
timing of the installation caused difficulties? Are there misinterpreta-
tions or misunderstandings of the system? Has a new situation devel-
oped which could not be foreseen?

The follow-up also enables the department to evaluate its work.
Have the changes produced the anticipated results? Are operations
proceeding as expected? How much personnel have actually been
reduced? How greatly has the volume of work handled been in-
creased?

Responsibility for the follow-up activity in the systems department
should be independent of all other activities to insure that it is not
subordinated to the seemingly more productive activities of the depart-
ment and to insure completeness and impartiality in the follow-up
survey. The person or persons engaged in the follow-up activity should
generally have no functions other than the checking on the results of
the department's projects, procedures, forms, recommendations, etc.

To provide a systematic basis for the follow-up activities, a follow-up
card should be prepared for each project as it is completed. Based on
the follow-up policy of the department, a follow-up date is recorded
on the card and the card is filed under this date. Each week, the cards
scheduled for follow-up are pulled. The procedures, recommendations,
or projects listed thereon are investigated to determine whether the
recommendations are being followed, whether the procedures are
working, whether changes are required. Every aspect of the procedure
and all the recommendations are checked by contacting the persons
involved and by direct observation.

Upon completion of each follow-up survey, a short report form is
prepared indicating:

1. Any aspects of the recommendations or procedures which are not
being followed.

274 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

2. Any aspects of the recommendations or procedures which are not
functioning as desired.

3. The actual savings resulting from the adoption of the project rec-
ommendations as compared with the estimate.

4. Any improvement recommendations regarding the project, includ-
ing a statement as to whether further systems action is required.

Copies of the follow-up report are then made available to the systems
analyst who was in charge of the project as well as the departmental
supervisor. If the report discloses the need for extensive additional
systems work, the project may have to be reentered and rescheduled
on the project register.

When the follow-up report has been submitted, a date for the next
follow-up is entered on the follow-up card for the project and the card
is refiled under the new date.

THE ORGANIZATION MANUAL

"The man who is best able to accomplish his job thoroughly and suc-
cessfully, and the one who gains the most inward satisfaction, is the
man who has a clear understanding and knowledge of the requirements,
the limitations, and the relationships of that job, and of its relative
position in the whole organization of which it is a part. To provide all
members of our management with this essential knowledge and under-
standing, we of Standard of California have developed over the past
twelve years what we call Management Guides.

"These Management Guides define the functions, responsibilities,
and principal relationships of management positions at all levels. They
are in daily use and are relied upon throughout the Company."

Thus writes Mr. H. L. Pallier, chairman of the Board of Directors
of Standard Oil Company of California in The Management Guide,
developed and used by Standard Oil Company of California as the
Organization Manual of the company. The Management Guide shows
the organizational structure of the company and indicates "the primary
phases of management for which the individual in the position is always
accountable." The responsibilities of each position are also stated, giv-
ing the specific aspects or duties of each organizational position. More-
over, the principal relationships of the position with other organiza-
tional positions on the same, higher, and lower levels are explained as
well as the nature of the accountability to a superior position.

To illustrate the kind of descriptions used by The Management
Guide, the following description of the function, responsibilities and

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276 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

authority, and relationships of the Chief Engineer, Engineering Sec-
lion, Manufacturing Division, of a hypothetical company manufactur-
ing and selling electronic devices is presented in Figure 91.

In addition to the uses mentioned by Mr. Pallier, the preparation,
distribution, and maintenance of an Organization Manual which out-
lines the basic functions, responsibilities, and authorities of all the
principal units of the organization serves several systems purposes. It
forces the systems department and the top management of the enter-
prise to make the basic analyses and definite decisions on the objectives
and responsibilities of the various units of the enterprise. By reducing
the responsibility, authority, and functional allocations to writing, it
makes possible a much clearer analysis of their logic and advisability
by all concerned persons. It fixes responsibilities for definite aspects of
the enterprise's work much more definitely than verbal instructions or
miscellaneous memoranda. Finally, it makes the basic organizational
policy of the enterprise available, in consolidated and convenient form,
to those who require such knowledge for effective prosecution of their
duties.

The Organization Manual establishes the fundamental bases for the
operations of the entire enterprise. Since these basic plans change
rather infrequently, revisions are made relatively seldom. When re-
quired, the affected sheets of the Manual may be reissued and inserted
in the looseleaf manual in place of the obsolete ones. All sheets of
the manual should therefore be dated and superseded dates should
be indicated. If a radical change in the organization of the enter-
prise is adopted, it is sometimes more practical to reissue the entire
Manual.

ORGANIZATION CHARTS

To enable the personnel of the organization to identify the organiza-
tional position of each person, it is desirable to issue organization
charts, which indicate the organizational lines of authority. This re-
duces confusion and is especially valuable in an organization in which
personnel transfers and changes occur rather frequently.

The chart should be very simple and should do little more than list
the title and names. Rather than draw elaborate and costly charts
which take time and use up considerable space, a simple listing with
indentions, such as shown in Table IV, is usually desirable. The
separate sheets of these charts should be reissued as required by per-
sonnel changes.

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278 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

PROJECT CONTROL

Just as the production department requires a simple but effective
system for controlling the issuance of material to the manufacturing
floor from the storerooms, so the systems department needs a system
for controlling systems investigations. Although the need for this con-
trol in the systems department is as great as in the production depart-
ment, it is much more complicated because of the complexity of the
work, the wide divergences of opinion on many systems problems, and
the inability to resolve many aspects of the work to a quanitative basis.

A systems investigation project may be instigated as the result of a
written request from one or more responsible department heads or it
may originate in a written request from one or more members of the
systems department. In either case, it is well to request that letters
asking for investigations should contain the sources of available in-
formation on the subject and should indicate:

1. The scope of the problem to be investigated, with definitive
boundaries.

2. The efforts which have already been made to solve the problem.

3. The groups and personnel which are involved.

Upon receipt of such a request, the systems department will usually
make a very short preliminary investigation to determine what the
project involves, whether it can be accepted, and the approximate
number of man-hours which will be required. If the project is accepted,
it is numbered and entered on a project register, such as shown in
Figure 92, and an approximate starting date is scheduled and tentative
assignment to a systems analyst is made. Because of the many intangi-
ble factors which are difficult to forecast, it is not usually practicable
to schedule the completion date at this time.

When the project is started, the actual starting date and the engineer
in charge are indicated. When the investigation has been completed a
report or proposal is usually made. The date is indicated on the register.

The proposals in the report may encompass new forms, new pro-
cedures, new lay-outs, revised allocations of organizational responsi-
bilities, new equipments or new work methods, or any combination of
these. It may be in the form of a twenty-five page written report, a
one-page memorandum, or a three-page proposed standard procedure.
In all of these cases, certain people must be sold on the proposal
before it can be adopted. These persons will vary, depending on the
organizational structure of the company, the nature of the proposal,

THE SYSTEMS FUNCTIONS AND CONTROLS

279

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| Number

Name

Estimated
Man Hour

Assignment

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NOTE: NAME IN ASSIGNMENT COLUMN 15 INDICATED IN PENCIL TENTATIVELY UNTIL
WORK 1$ ACTUALLY STARTED. THEN, AN INK ENTRY IS MADE.

Figure 92. Project Register, a chronological record of accepted projects.

and the systems department sales policies. After the recommendations
have been sold, they are installed. The installation date is then entered
on the register. When the new system has been completely installed,
and a final report on the project has been completed, the project is
closed out and the date indicated on the register.

WORKLOAD SHEETS

To enable the systems department supervisor properly to schedule
forthcoming work, it is usually valuable for him to keep a simple work-
load sheet for each of his analysts, on which are indicated the tenta-
tively assigned project hours as well as the estimated hours required
for completion of the current projects.

PROJECT STATUS AND SUMMARY RECORDS

To control the operations of the systems investigations, provide in-
formation on the status of each project, and summarize the costs and
accomplishments of each, it is frequently desirable to keep some sort
of project status and summary record. This card record may contain
the following information on each project undertaken by the depart-
ment:

1. Project number

2. Name

3. Origination

4. Scope and purpose

5. Date received

6. Estimated man-days and spaces for revisions of the estimate

280 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

7. The scheduled and actual dates for

a. Start of investigation

b. Completion of investigation

c. Completion of report, recommendations, newly designed
forms, new procedures, charts, etc.

d. Completion of selling

e. Completion of installation

(Spaces should be allowed for revisions of the schedules as
the work progresses )

8. Record of time spent on the project

9. Brief summary of the accomplishments of the project upon
completion, including analysis of cost savings

10. Analysis of the costs of the project, including the costs of

a. The systems analyst's time

b. The estimated time of other personnel in the organization
whose time was taken by interviews, questionnaires, etc.

c. The supervision and clerical costs in the systems depart-
ment as well as other overhead items of the department

d. Other special expenditures required in conducting and
concluding the investigation and installation.

Completed project cards should be filed separately from the cur-
rent ones. These cards are very useful for loading the systems per-
sonnel, for preparing activity and accomplishment reports, and for
answering numerous general questions about the status of any given
investigation.

PROJECT FOLDERS

In the chapter on obtaining systems data, the importance of a sys-
tematic and neat procedure for gathering and recording information
was emphasized. These worksheets, arranged in a systematic manner,
are fastened together in the project folder at the conclusion of the
project. When properly indexed and filed, they provide a valuable
source of systems information for future use as well as a means of
answering any questions which may be raised about the investigation.

FINAL PROJECT REPORTS

After installation has been completed, the project status records, the
project folder, and the previously prepared report on the results of the
investigation will be the basis for the final report on the project.

THE SYSTEMS FUNCTIONS AND CONTROLS 281

This report will explain how the recommendations of the previously
prepared report have been implemented, what immediate tangible and
intangible results have been accomplished, and what potential advan-
tages are expected to accrue in the future. To make this final report
complete, it is frequently desirable to include any written procedures
and instructions which have been issued to implement the system.

PROCEDURES CONTROL

In the previous chapters we have discussed the principles and
methods for determining systems policies, for ascertaining correct pro-
cedures, for determining the best methods of performing the required
functions of the enterprise. Having determined the best systems, how-
ever, they are valueless to the enterprise if they are not known to the
personnel. A basic medium for announcing and for making these de-
tailed systems known to the personnel is the written instruction. These
written instructions are usually known as procedures or standard prac-
tice instructions.

The best methods of organizing procedures manuals will depend on
the character of the enterprise its organization, size, complexity, and
manner of controlling operations. The most effective means of handling
the formalities of issuing procedures will also vary from company to
company. In Appendix A to this chapter is shown a written procedure
or standard practice instruction of a well-known enterprise which de-
scribes the rather elaborate system of manuals used in the company.
In Appendix B is shown a standard practice instruction of the Ameri-
can Machine and Foundry Company describing how the written pro-
cedures of the company are developed, approved, classified, and issued.

It is usually desirable to establish a procedures manual which will
contain the written procedures in readily available form. Durable loose-
leaf binders of simple construction should be used to allow ready
insertion of new material. However, it is not usually necessary for all
recipients of procedures to have a procedures manual. It is desirable
for each department to have a procedures manual available for refer-
ence. The manual will usually be issued to the supervisor for his own
as well as staff use.

For written procedures to be effective, they must be placed in the
hands of all persons who are concerned with the functions covered.
Wide-spread distribution amongst all persons concerned is therefore
desirable. These persons, however, do not require a manual since they
only receive those procedures which directly affect their own activities.

282 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

The distribution of individual procedures is determined on the basis
of both organizational level and functional responsibilities. Thus, top
management policy procedures would go only to top officials of the
company. A procedure covering the ordering of replacement parts
would be sent to all holders of procedure manuals ( department super-
visors and higher levels) as well as all section supervisors in the pro-
duction-planning department and all other persons directly connected
with the performance of the ordering function.

To control the distribution of the procedures, standard distribution
lists are established. Distribution A includes all top management offi-
cials in each department. Distribution B includes all persons of de-
partment supervisor level or higher, with the exception of those in-
cluded in list A. Distribution C includes all persons of section super-
visor level in each department. Thus, the top management policy pro-
cedure goes to Distribution A only. The procedure covering the order-
ing of replacement parts would go to Distribution A (all departments),
Distribution B (all departments), Distribution C (production-planning
department) plus the list of persons operating directly under the pro-
cedure. (The analyst who developed the procedure determines those
who are directly concerned.)

The names of persons on each distribution list are kept up to date by
keying these persons' names and positions on the master copy of the
Organization Chart. Whenever any of these keyed names or positions
change, this fact is brought to the attention of the person maintaining
the distribution lists. A file card is maintained for each procedure, on
which is indicated the distribution of each issue and revisions. When
revised procedures are issued, there is a danger that the superseded
procedure will not be removed from the manual. It is therefore the
practice in some companies to require that the superseded procedure
be returned to the systems department with the transmittal sheet of
the revision. The obsolete procedures are then destroyed by the sys-
tems department. Some systems departments have found it desirable
to go so far as periodically to inspect the procedure manuals to insure
that they are being kept up to date.

As pointed out in an early chapter describing the general subject
of systems work, the systems of an enterprise require continual revision.
These revisions mean changes in the written procedures. Shall these
changes be made (1) by reissuing the entire procedure, (2) by re-
issuing only the affected pages, or (3) by issuing addenda and errata
sheets? The latter two methods are a bit cheaper than reissuing the
entire procedure. However, they suffer from the defect that all copies

THE SYSTEMS FUNCTIONS AND CONTROLS 283

of the procedure may not be clipped with the errata sheet and that
all changed pages may not be substituted in the procedure because of
negligence on the part of the recipient. This risk of having obsolete
procedures in use is smaller when entire procedures are reissued
because it is simpler to substitute the entire procedure and because
the systems department can require the return of the old procedures.
Also, subnumbering of pages is not required when the complete reissue
method is used. The necessity of revisions is an added reason for keep-
ing the size and scope of individual procedures relatively small, so
that only small units have to be reissued at any one time.

To provide for maximum ease in locating desired procedures, the
procedures in the manual should be arranged in accordance with a
systematic numbering system. The R.C.A. Victor Company at Cam-
den, New Jersey, evolved a system of functional classifications, a sec-
tion of which is shown in Figure 93. In this scheme, all the principal
classifications and subclassifications of functions are arranged in logical
fashion and blocks of numbers assigned to each. Each procedure is
then numbered in accordance with this break-down. Thus a procedure
on stock records would be numbered 2025-12, because its subject is
part of the inventory-control function. The 12 after the dash distin-
guishes this procedure from all others on this function. This system
allows sufficient room for the addition of new functions as the needs
develop. In addition to systematic numbering, the procedures should
be indexed, with much cross-referencing to provide speedy location
of desired material.

The procedures should be issued in standardized format and the first
sheet of each procedure should have a simple but impressive heading,
identifying the procedure, the company, and the group in the company
responsible for its issuance. Space should be provided in this heading
for:

1. Procedure number

2. Page of

3. Date of issuance

4. Date effective

5. Date of issue superseded (if revision)

6. Functional classification of the procedure

7. Title of the procedure

At some place in the procedurethe back of the last page is con-
venientthe following reference information should be indicated:

284 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

FUNCTIONAL CLASSIFICATION

CAMDEN PLANT PROCEDURES AND BULLETINS

Issued by: Systems Section
Industrial Engineering Department
Date: 6-2-^5 Supersedes: Initial Is sue^no date) ^

All Camden Plant Procedures and Bulletins are numbered according to the
functional classifications listed below. When a Procedure or Bulletin in-
volves more than a single function, the number of the function most in-
volved is used. This functional classification may be used as a guide to
the location of instructions when the exact title or number is not known.

ENGINEERING (PRODUCT)

1800-Engineering, General
1810-Design & Development

(Eng. Releases, ECN's, Packing
Design)

18 15- Model Building
1820-Drafting
1825 -Blueprint Issuance
1830-Engineering Estimating
18^0-Breakdovm
l8Jf5-Preparation of the UBM
1850-Chemical Engineering
i860- Standardizing
1880-Photographing
1885-Engineering Publications
1890-Measuring Equipment Designing

MATERIAL CONTROL

(See also Production Control)
2000-Material Control, General
2010-Material Moving
2020-Reject Control
2025- Inventory Control
2030-Miscellaneous Material Storing
(Maint., Office, & Factory Sup-
plies; Terminated Mat' 1.)
20^0-Rav Material & Hardware Storing
2050-Accumulation of Parts
2060-Receiving
2070-Stock Expediting
2080-Tool Crib Operation
2090-Hold Rooms

ACCOUNTING

1000-Ac count ing (Plant), General
1010-Ac count ing - Cost
1020-Accounting - Fixed Asset
1030-Accounting - Stores
10^0-Accounts Payable
1050-Billing Direct
1060-Billings to Home Office
1080-Payroll
1090-Tabulating
1150-Time keeping

ADMINISTRATION

1200-Administration, General

1210-Sales Contact

1230-Government Liaison

1270-Systems

1276-Organization Control
COST CONTROL

1^30-Expense Control

llf35~Departmental Budgeting

Ilf50-Preparation of Cost S'tds. & Est.

lJt-70- Times tudy Coordination

1475-Timestudy

PLANT SERVICES

1600-Plant Services, General
1615-Facilities & Equipment
1625-Receptionist & Escort Service
1630-Mail Service & Intra-Plant Connn.
1635-Janitor Service
1640- Plant Layout
1650- Maintenance
1660-Guard Service
1670-Power Plant Services
1690-Fire Protection
1700-Clerical Services

Figure 93. Portion of a functional classification system,

Associated procedures. Related procedures which affect the systems
in the subject procedure should be listed by title and number.
Forms involved. The names and numbers of all forms used or men-
tioned in the procedure should be listed.

Distribution. The distribution of the procedure will be indicated
by the code previously explained. When the procedure is distributed
to non-supervisory employees, such as the clerks in the inventory-
control section, this fact will be indicated not by listing the names

THE SYSTEMS FUNCTIONS AND CONTROLS 285

FUNCTIONAL CLASSIFICATION
Date: 6-2-^3 Page : 2_ of 2

PERSONNEL RELATIONS

2liOO-Personnel Relations, General
24lO-Wage and Salary Administration
2lf 20- Interviewing and Hiring
2li30-Labor Relations
2^35-Personnel Records, Selective Serv
2W-0-Employee Training & Education
2l*50-Employee Services

(A. A., Nevs, Sound System)
2J*55-Cafeteria Operation
2l*6o-Employee Sale a
2^70-Suggestions & Assignments
2U80-Saf ety and Health

(Beneficial, Dispensaries)

PRODUCTION'

26^0- Processing
2660-Tool Designing
2800-Manufacturing General
2805-Factory Development
28lO-Manufacturing Research
2815-Assembly
2820-Department 82
2825-Factory Expediting
2830-Product Expediting

(Project Eng. Prod. Mgr.)
28^0-Crystals

28^9-Chemical Preparations
2850-Components, General

2851-Tranaformers

2852-Capacitors

2853-Coils

285l|-Plaatics
2856-Fatrication
2870-Tool Control
2875-Tool Construction
2880-Phonograph Records
2890-Packaging (Spare Pts. Records)
29QO-Packaging Material Construction
2910-Mcasuring Equipment Construction
2930-Packing Finished Goods

PRODUCTION CONTROL

(See also Material Control)

3000-Production Control, General

3 010- Authorization to Manufacture

3011-Tenninations

3020-Sourcing

3030-Machine Loading

30^4-0- Order ing

3050-Pre-Production Scheduling

305^-Scheduling

3060-Material Release

3 070 -Dispatching

3000-Plant Loading

3090-Production Performance Reports

PROCUREMENT

' 3200- Procurement, General
3&20- Subcontracting
3230-Euying
3 2^0- Vendor Expediting
3250- Verify ing Vendor Charges
3260-Vendor Claims
33^0-Priorities

QUALITY CONTROL

3H^O-Teat and Inspection
3M^5-Quality Standards
3 J 4 yO-Purchantid Material Inspection
j^GO-Meaouring Equipment Testing

& Inspecting
3'470-Tool Inspecting
3lf80-ReJect Analysis

WAREHOUSING
38'tO-Shipping

3850-Trucking and Transportation
3860-Domestic and Export Traffic
3870-FIniahed Goods Storing

INTER-PLANT AND HOME OFFICE

5010- Inter-Plant Engineering Com-
parisons

5020- Inter-Plant. Communications
5030-Replacement -Parts
50h 0- Insurance

Courtesy RCA Victor

showing code numbers used in classifying procedures.

of these clerks, but by the notation "all inventory clerks (16) in
section 42."

Prior to the issuance of a new or revised procedure, it is very de-
sirable to have the agreement of all persons concerned with its opera-
tions. The practice of circulating a draft copy of the procedure amongst
the persons for comments is usually very time-consuming. This agree-
ment can usually be best obtained by duplicating the proposed pro-

286 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

cedure and sending a copy to each person requesting that he indicate
thereon his comments and agreement or disagreement, and return by
a certain date. (To avoid delay in getting agreement, some systems
departments set up the rule that all copies not returned by a given date
are considered approved. ) After all comments have been received, it is
sometimes found desirable to call a meeting of several of the persons
to iron out minor differences of opinion.

FORMS CONTROL

Because most systems involve clerical activity which must be per-
formed on forms, control of the design and distribution of forms pro-
vides a pivotal means of controlling the systems. Forms design and
control, therefore, constitute vital parts of the systems-control program
of the systems department.

The principles of forms design have already been discussed at some
length in a previous chapter. In order to obtain full benefit from good
forms design, it is necessary properly to control the issuance, ordering,
distribution, and use of these forms. This function is called forms
control.

Effective forms control will provide the framework for accom-
plishing the following:

1. All forms eventually designed properly.

2. Coordination between the systems and the forms used in the sys-
tems.

3. Ease of identification of forms referred to in procedures.

4. Availability of forms as required by the systems.

5. A means of enforcing and following up on the operation of systems
because most changes in a system will affect forms. These changes
will be brought to the attention of the systems department when
new forms are requested.

6. Systematic elimination of useless and conflicting forms, and creation
of new well-designed forms as required.

7. A central source of valuable systems information provided by a
forms file containing every form in use in the organization arranged
in a logical fashion and cross-indexed by systems usage.

8. An efficient system for ordering, stocking, and issuing the correct
quantities of each form to its authorized users.

THE SYSTEMS FUNCTIONS AND CONTROLS 287

FORMS-INVENTORY CONTROL

To accomplish these objectives, the systems department must insti-
tute certain procedures. Physical control of the stocking and issuing of
all printed forms should be established in a central stockroom. This
centralized physical control will provide a means of restricting the
supply of forms to authorized users. Quantities withdrawn for use can
be limited to reasonable amounts in accord with requirements: this
enables the systems department to discourage the hoarding of forms
which complicate changes in forms design and causes fictitious usage
figures.

By maintaining an adequate minimum stock-recording system, the
department can insure that forms are always on hand to meet systems
requirements. The minimum stock point should always be set high
enough to allow sufficient time for thoroughly reviewing the forms
design prior to reordering. When forms designs are changed, the de-
partment can remove from stock and call in all the obsolete ones which
have been issued, since all the users will be known.

When no copies of a form have been requisitioned from the stock-
room for more than a given period say one yearan obsolescence
investigation slip is sent to the forms-control unit in the systems de-
partment. The forms-control unit determines whether the questioned
form is still being used and informs the stockroom of any disposal
action which may be necessary to avoid the accumulation of obsolete
forms.

The forms inventory-control record provides a history of the printing
dates and quantities, the distribution of the form, revisions, etc. To-
gether with the forms file, discussed later, it summarizes a complete
history of the form.

FORMS-NUMBERING PROCEDURES

All forms should be numbered in accordance with some procedure,
which may be nothing more than a simple numerical numbering of
each form for identification purposes. The kind of numbering system
is not as important as the consistent application of the system. For
illustration purposes, three possible systems are presented here. If a
reasonable system is in use, it is not generally worthwhile to change it.

NUMBERING SYSTEM A:

Each form is given a number one unit higher than the previously
numbered one, regardless of the nature of the form. When the form

288

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

is revised, an R 1 is placed after this number for the first revision, and
R 2 for the second revision, and so on. Example: 168 R 3 is the third
revision of form 168.

NUMBERING SYSTEM B:
A functional numbering classification is established, such as

1000 - 1999 Engineering

2000 - 2999 Production

3000-3999 Accounting

4000 - 4999 Personnel

Forms are arranged numerically in each of the above categories
depending on the functions in which they serve. Forms used in more
than one function are placed in the one of primary usage. Preparatory
to establishing a functional numbering system, a functional analysis of
all forms on a chart such as Figure 94 must be made to show the func-
tions which make use of each form. This analysis will also serve as the
basis for the functional cross-indexing file mentioned later.

Figure 94. Forms Functional Analysis Chart, especially useful for inventory-
ing and analyzing all forms in the initial phases of a forms program.

NUMBERING SYSTEM C:

The functional classification is abbreviated, then a numerical number
in the functional classification series, then the quantity last printed,
and then the date of the printing is added to construct the form num-
ber. Thus PR49 5M 749 indicates that it is a form used for a
production function, number 49 in this series, and 5,000 copies were
ordered in July 1949.

The possible variations in numbering systems are limitless. Gener-
ally, the simpler the system, the better it is. In all cases, a Forms

THE SYSTEMS FUNCTIONS AND CONTROLS 289

Number Ledger must be kept for assigning the numbers in sequence.
This ledger should contain columns for:

1. Number of form

2. Title

3. Date initiated

4. Date superseded or discontinued

5. Reason for discontinuance and/or the superseding form
number.

FORMS FILE

A forms file containing two copies of every form used in the organi-
zation is required. (The extra copy of each form is required because
one copy may be sent to the printer when the form is reordered.) A
folder is established for each form and is filed by form number. In
addition to having two copies of each form, the folder would contain
information on ( 1 ) what departments are authorized to use the form,
(2) what procedures require the use of the form, and (3) any notes
on future desired changes to be considered before reordering.

CROSS-INDEXING FILE

It is usually desirable to have a cross-indexing file, relating form
titles to form numbers. It is also sometimes considered desirable to
have a functional cross-indexing file to be able to locate all forms
connected with each function. This facilitates the combination and
elimination of unnecessary forms.

ORDERING PROCEDURE

All requests for new forms or revisions of old forms must be routed
to the systems department for evaluation in accordance with sound sys-
tems considerations. If a new form is to be adopted, its design will be
carefully planned, as outlined in a previous chapter. The paper, print-
ing, and quantity specifications will be established in accordance with
the department's standards. In addition, the authorized users will be
specified.

Whenever the stock of a form reaches the minimum point, the sys-
tems department is alerted by the stock clerk. Any suggested changes
are noted from the Forms File folder; all procedures using the form are

REQUEST - FORMS

>Hcot and submit with sample of form. Section A to be
I form and fofmrded to Indu; - - - - - -

be anawered by originator of
B and C to be compltd by

QNEW J REVISED QREPRINT

fllU OF FORM

2. TO BE PREPARED BT:
Z. PURPOSE OF FORM:

4. TO BE PREPARED

7. POSTED TO
FORM (S)

Other (explain)

8. FILING EQUIP-
MENT TO BE
USED.

BINDER
ng Q Posi
DTOP CD side

11. SUGGESTED
METHOD OF
REPRODUCTION

Card - Slz X

Other (explain)

No. rings or posta

Dla.rlnga or posta

c. to c. Spacing;

Mimeograph Copies

Hectograph Coplf

Other (explain)

12. If CARBON IS
TO-BE INCLUDED
WITH FORM,
CHECK THE 8UO-
OESTED TYPE.

Carbonised BacK.

Other (explain)

13. SER. NUMBRO.
TO BEGIN WITH

. SUGGESTED CQFTt
DESIGNATION
FOR DISTRIBU-
TION

. WILL SUPERSUE
d PARTIALLY
Q COMPLETELY
TORM(S)

Interleaved Padded

Fan to id-Con t In uous

D Yea D NO

Sllnouette Numbers

Printed Addresses

Colored Paper

16. WILL BE REVIEWED FOR POSSIBLE

REVISION IN MONTHS.

17. ANTICIPATED NUMBER OK COPIES
REOJJIRED _ ....

SECT I OB B (18)

APPROVED. DISTRIBUTION

19. QUANTITY OF OLD FORMS NOW AVAILABLE

Distributed To

Distributed To

20. SUPPLY WILL BE DEPLETED BEFORE NEW FORM IS PUT INTO
USE IU Tes Q NO

21. IF ANSWER TO ITEM 20 IS "to", WHAT DISPOSITION IS TO
BE MADE OF OBSOLETE FORMS? Q Destroy
D Scratch Pads Mold for months

22. TOTAL COST OF FORMS MADE .OBSOLETE

23. APPROVED REPRODUCTION:

DfanfoldD

24. ORDERING SPECIFICATIONS

Copy 11 Copy jg copy tz Copy |4

Grade of Paper

Color of Paper

Color of in*

Same type or plate fl to 10

copy no

QTOP

CjBOt.
QLft
Right

Tumble or Leaf Turn

D wrap
D Band

Numbered Serially

Silhouette Numbers

Charge to ......

Estimated Uac;

_upon Rec<

1 yr.

Industrial Bngineerlng Department
Date:

Courtesy RCA Victor

Figure 95. Form for requesting a new or revised form and for reordering
an old one.

290

HAMMIRMItl FORM ORDIR SJUlf FART a

To-

Dal*.

.19-

Prom.

COMPANY ADD*...

Name or

Trimmed Size: width

Start numbering at -r

To fit

n pint^ n CV'ooV

a Hold type form D Have form plated

PAPER STOCK D USE HAMMERMILL

COLORS OF INK

COFY#

COLOR

WEIGHT

FINISH

ORADE

FRONT

BACK

NUMBERS

1

2

3

4

5

6

7

t

PUNCHING, ETC

HOW USED

HOW FILLED IN

DRUU

srj

a STITCH

D STRING
p WIRE

Q GUM STRIP
Q CARBON SHEET

MUc.t

Q SCORE
waTS D PiRFORATB (Ph. Slot)
^ D PUNCH IN, HOIES

D we cur

D RUtE CUT
Q ROUND CORNER
Q SPECUl SIOTTINO

DCARDRte
O V1S1BIE RUE
D IfTTfRFU!
, CENTERS D VISIBLE BOOK
Q POST BINDER
Q RtNO BINDER
SPECIAL BINDER
D CUP BOARD

QPEN
D PENOl
D PICA TYPEWRTOR
Q ELITE TYPEWRITER
Q SPIRIT DUPLICATOR
Q GELATIN DUPLICATOR
Q STENCH DUPLICATOR
Q OTHER METHODS

D Quote price

not Infer thorv- - 19

Pttlvtr t-r

Aft^f^n o f ,,.,.,

On or before

a Wrap
19. H Band

D Carton
D Case

Single

Sp^lal tnttructiont:

Sfaniwf ,. . ... ,

Courtesy Hammermill Paper Company. Reproduced by permission

Figure 96. Printing Specifications Form for insuring that all reproduction
aspects are considered and specified.

291

292 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

checked; all users are contacted for suggested improvements; and a
complete forms-design analysis, using previously presented principles,
is made.

For both reorders and new forms, an ordering form, such as shown in
Figure 95 or a printing specifications form, such as shown in Figure 96,
is used to insure that all production aspects have been carefully con-
sidered and specified.

POSSIBLE SAVINGS FROM FORMS CONTROL

"What savings can be expected from an effective forms control pro-
gram?" asks Herman Krauss, Planning Supervisor, Mutual Life Insur-
ance Company of New York.* He then continues:

"Here are some of the results of the program in my company, where
a staff of three works on forms control; when the program started, there
existed 3,208 forms in the organization. Five years later this number
had been decreased to 1,987 forms. Procurement or initial cost savings
average $27,000 per year, or $135,000 for five years. Cost of the forms-
control personnel was $9,000 per year, or $45,000 for five years.

"In one procedure alone the company originally used 27 different
forms; 10,350,000 of these forms were used per year. After revision
there were seven forms with 4,800,000 copies used per year. That re-
duced the number of copies handled to 47 per cent of the previous
figure. Operations on each form were reduced from an average of 34
to an average of 18, or to 53 per cent of the original operations required.
Savings in clerical costs amounted to $160,000 a year.

"Bear in mind, however, that such a program is ineffective if allowed
to wither on the vine and die of neglect. It must be kept alive by con-
stant revisions. In short, a forms standardization and control program
that produces not more forms, but simpler, more efficient forms,
designed and supervised by a man who knows his stuff, is a major con-
tributing factor to lower office costs/*

LAY-OUT CONTOOL

The office lay-out-control function of the systems department in-
volves three principal aspects:

1. Development of standards for office lay-outs.

2. Maintenance of an up-to-date record of the office lay-outs of the
enterprise.

Herman Krauss, "Standardizing Forms Control," Office Management, Series
Number 122. New York, American Management Association, p. 30.

THE SYSTEMS FUNCTIONS AND CONTROLS 293

3. Control of rearrangements of offices so that none are made without
prior consideration of the systems department.

The development of standards of good lay-out practice and policies
for such office lay-out problems as the private office, amount of space
for persons of various rank, etc., are discussed in Chapter VI. The con-
trol of office rearrangements and the enforcement of lay-out standards
is maintained by requiring that all proposals for lay-out changes be
submitted to the systems department.

EQUIPMENT CONTKOL

The equipment-control program of the systems department is, of
course, closely correlated with all the other activities of the department.
Its functions may be divided into five principal phases:

1. Maintenance of a current source of information on the office equip-
ment used in the enterprise.

2. Establishment, in conjunction with the other sections of the systems
department, of such office equipment standards as are deemed
advisable in accordance with the considerations outlined in Chap-
ter IX.

3. Control of the purchase and use of equipment to insure that:

a. Equipment standards are observed.

b. Standard procedures are not violated.

c. Existing equipment cannot perform the work with greater
over-all economy.

4. Development and administration of sound equipment, maintenance,
and replacement policies.

5. Serve as a source of expert technical information on the operations
and application possibilities of the various types of presently used
equipment as well as the newly developed equipments which are
constantly appearing on the market in increasing variety.

EQUIPMENT FILE

The first phase of this equipment-control activity, maintaining an
office equipment usage information source, is essentially an inventory-
control function. What equipment does the company own and where is
it used? The usual procedure is to maintain a card file containing a card
for each piece of equipment. This card should contain spaces for the
following information:

294 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

1. Company assigned number

2. Kind of equipment

3. Description

4. Make of equipment

5. Model and serial number

6. Company identification number

7. Location of the equipment

8. Date of purchase

9. Cost

10. Maintenance costs and dates.

EQUIPMENT STANDARDS

In establishing office equipment standards, the systems department
should usually adopt a careful attitude. As pointed out in Chapter IX,
rigid standards must not be imposed which will limit the use of differ-
ent types of equipment where such differences will result in greater
over-all economy.

REQUISITIONING EQUIPMENT

Properly to control the purchase and use of office equipment, it is
essential that all requisitions for new equipment, for the transfer, mov-
ing, and reconditioning of equipment be submitted to the systems
department. The requisitions are scrutinized for conformance to estab-
lished equipment and procedural standards.

Requisitions for new equipment will be investigated by first deter-
mining whether the same kind of equipment is presently used for the
performance of the work. If not, then the purchase of the new equip-
ment will usually involve a systems change and should be investigated
to determine its desirability. Is the requested equipment the best for
the job?

The Equipment File should be checked to ascertain the age, cost,
capacity, maintenance record, and obsolescence status of the presently
used equipment. Then, an economy analysis must be made to ascertain
whether, in accordance with established policies, the replacement
should be made.

If the new equipment is intended to provide additional capacity, a
detailed analysis of production rates and loads may be required. Can
better scheduling reduce the peak load which causes the additional
machine requirement? If a number of departments use the same type

THE SYSTEMS FUNCTIONS AND CONTROLS

295

of machines and have different peak periods, is it possible to set up a
central pool of machines which would be transferred from department
to department in accordance with its requirements?

REVIEW OF EQUIPMENT

Not only should the equipment-control function of the systems
department provide a source of expert technical information on new
equipment developments, but a logical search for new applications of
labor-saving devices and improved equipment should be conducted.

CNR.85S2
" '

OFFICE EQUIPMENT INVENTORY

FURNITURE

mm

ANY SURPLUS FURNITUHE SHOULD Mt MAM*.

Bi^Sl " "" NO OF

,,HTMNCM A PLACE OFFIC E STAFF C

JATP -T-. - '

CLASS
FURNITURE

COLOR

MATERIAL

SIZE

DESCRIPTION

NAME OF POSITION OF EMPLOYEE
USING rUKNITURC

<^\,

s~- .

^/\

^ ^-- J

-/~\./

/^\

H

/ * ^

1

x "

^ ^^-^

^

/ \

EXAMPLES:
FILE CABINET
DESK
DESK
CHAIR
CHAIR

GREEN
LIGHT OAK
MAHOGANY
LIGHT OAK
DARK OAK

METAL,
WOOD
WOOD
WOOD
WOOD

CAP

34"X60"
30"x42"

4 DRAWER
FLAT TOP DRAWER
SINGLE PEDESTALDROP BED
SIDE
ARM SWIVEL TILTER

YEARS
YEARS

TMEHC is no SURPLUS runNiToBi orntw

YEARS

IIONATUMK

WHEN THERE IS'ROOM A NUMBER OF OFFICES AT THE SAME POINT AND IN THE SAME DEPT MAY
BE LISTED ON ONE SHEET IF NAME OF OFFICE AND NUMBER OF STAFF IS SHOWN FOR EACH OFFICK.

Tiric

Courtesy Canadian National Railways

Figure 97. Office Furniture Inventory Form of Canadian National Railways.

Periodic reviews should be made of the office equipment in use in the
company. The fact that equipment is old does not necessarily indicate
that it should be replaced. Maintenance and repair costs may be low
and newer machines may not show any significant operating improve-
ments.

The equipment-control procedure of the Canadian National Rail-
ways is described below as an illustrative example of how such a
system may be established: *

* "Standardizing Office Forms and Equipment," Policy Holders Service Bureau,
Metropolitan Life Insurance Company, New York, 1947.

296

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

As a preliminary step, two blank inventory forms were designed, one for
furniture and one for machines, and were distributed to every office in the
railway system with instructions that they be filled in and returned to Office
Services as of a certain date each year. These forms are reproduced as
Figures 97 and 98. Inventories thus submitted provide a record of the
equipment in use in each office and permit a comparison of the relative
equipment requirements. From this it was possible to establish approximate
standards as to the amount of machine equipment necessary for various
volumes and types of business.

OFFICE EQUIPMENT INVENTORY

MACHINES

NOTE MARK ANY PERSON AU.V OWNCO
MACHINE "PERSONAL" SHOWING
NAME AND POSITION^ OF OWNER.
ANY" SURPLUS MACHINE SHOULD BC
MARKED"SU RPLU S 1 ' IN UAST COLUMN,

EXAMPLES-
TYPEWRITER
ADDER
DUPLICATOR
CALCULATOR
DICTATOR

UNDERWOOD

BURROUGHS

MIMEOGRAPH

MONROE

DICTAPHONE

USTEO ON ONt

F. OF O

567
567

10" CARRIAGE
8 COLUMN
8" PAPER
8 COLUMN

TRANSCRIBER

ICE AND NUMBER OF STAFF IS SHOWN FOR fcACH OFFICE.

Courtesy Canadian National Railways

Figure 98. Office Machines Inventory Form of Canadian National Railways.

Two primary record files are maintained for purposes of equipment
standardization. One of these is a current equipment inventory with a special
designation for surplus or inactive equipment. For purposes of controlling
surplus office equipment, a special form of report, illustrated in Figure 99,
is prepared for each shipment of surplus equipment received or issued from
surplus stores (a slightly different form is used for office machines). One
copy of this report is sent to Office Services.

The other record is the Office Equipment Standards File, consisting of a
separate card for each type of machine or equipment [which has been
adopted as standard. The card provides for full description and specification
of the standard equipment]. The reverse side of the card provides for attach-
ing a catalog cut of the item and for notation of special features and specifica-
tions. These cards are filed according to the name of the position or office to
which the equipment applies as well as by type of equipment.

THE SYSTEMS FUNCTIONS AND CONTROLS

297

With the primary objectives of securing the benefits of quantity purchases,
interchangeability and minimum maintenance costs, equipment standardiza-
tion in this company takes into consideration the following ten points.

1. Original cost of equipment

2. Guarantee

3. Durability

4. Portability

5. Repair service

6. Maintenance cost and depreciation

7. Operating cost including supplies

8. Production capacity and average expectation

9. Functional adaptability where a machine might be adapted to
different kinds of work

10. Competitive costs of different types of machines for any speci-
fied class of work.

[jiJsa "CPORT OF SURPLUS FURNITURE RECEDED OR ISSUED FROM STORES Al

Courtesy Canadian National Railways

Figure 99. Surplus Stores Equipment Form of Canadian National Railways.

As a means of establishing the need for each piece of equipment pur-
chased, two forms are provided for recording all the necessary data regard-
ing its proposed use. These forms, reproduced as Figure 100 for office
machines and Figure 101 for office furniture, must be completed and sub-

298 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

mitted with each requisition whether for additional equipment or replace-
ments. The information requested on the forms has been simplified as much
as possible so as to minimize the burden on the requisitioning department,
but is designed to provide a check on all unnecessary expenditures. In some
cases supplementary information must be called for as the investigation
progresses.

ffiSaa REQUISITION DATA OFFICE MACHINES

t. TYPE OP MACHINE REQUIRED (EXAMPLE: TYPEWRITER, A

1 A. REPLACEMENT OR ADDITION?.

I. FOR TYPEWRITER STATE PERCENTAGE OF CORRESPONDtNCI

FOR ADDER OR CALCULATOR. STATE PERCENTAGE OF ADDITI

DIVISION 7 C . PERCENTAGE OR RATIOS %. I

FOR DUPLICATOR , % Of WORK REQUIRES COPIES. % OF WORK REQUIRES COPIES. LARGEST SUE

PAPER TO BE DUPLICATED *

. DESCRIOETHEWORKTOBEDONEONTHISMACHINE.ANDSTATE IF THE WORN REQUIRES OTHER THAN STANDARD MACHINE SUCH AS WIDE

CARRIAGE. SPECIAL KEYBOARD. DECIMAL TABULATOR. ETC . . . _.

(PICA TYP (10 TO I INCH) it THE MOST SATISFACTORY AND ECONOMICAL TVP
4. IF ADDITIONAL MACHINE, HOW IS THIS WORK DONE NOWT__

9, ANTICIPATED NUMBER OP HOURS DAILY USE IN YOUR OFFICE

6. WILL IT BE AVAILABLE FOR USE OF OTHER OFFICES? ___!F SO. HOW MANY HOURS? _L

t. MACHINE TO BE TRADED IN. It ANY: (ir FOR MME THAN ONI MACHINE, oive IIMIUUI INFORMATION FOR EACH EXTRA MACHINE ON BACK or THIS FORM)

A. MAKt? . , , D. DATE AND COST OF LAST OVERHAUL?

B. MODEL NUMBER? __ E. PRESENT OVERHAUL ESTIMATE?

C. SERIAL NUMBER* F. ESTIMATE MADE BY?

ft. WHAT DIFFERENT MAKES OF THIS TYPE OF MACHINE DO YOU NOW USE IN YOUR OFFICE? (c.ve, TOTAL N

ft. GIVE FULL DETAILS OF THE SAVING. IF ANY. WHICH WILL JUSTIFY FILLING THIS REQUISITIC

INSTRUCTIONS FOR USE OF THIS FORM

THIS FORM IS TO BE ATTACHED TO ALL REQUISITIONS FOR OFFICE MACHI
MANUFACTURERS- NAME SHOULD NOT BC SHOWN ON REQUISITION.
JSIVE AS MUCH INFORMATION AS POSSIBLE IN ANSWER TO THE ABOVB
IF MORE SPACE REQUIRED. MARK 'OVER- AND USE BACK OF FORM.

Courtesy Canadian National Railways

Figure 100. Form for requisitioning office machines of Canadian National
Railways.

THE SYSTEMS FUNCTIONS AND CONTROLS 299

REQUISITION DATA-OFFICE FURNITURE

REQUISITION NO

I.A. REPLACEMENT OR ADDITION? -

*. IF REPLACEMENT. WHAT DOES IT REPLACE?
A. OIVB AGE AND fnum r mn . .

B. STATE PROPOSED DISPOSITION?.

>. IF ADDITIONAL, IS IT FOR EXTRA CLERKT_

A. PERMANENT OR TEMPORARY CLERK?

B. IF CLERK TRANSFERRED FROM ANOTHER OFFICE, OIVE REASON FOR NO TRANSFER OF FURNITURE?

4. POSITION OF EMPLOYEE WHO WILL USE THIS FURNITURB?

a. IF FILE OR INDEX CABINET. GIVE NUMBER AND SIZE OF PRESENT CABINETS AND DRAW

A. DESCRIBE CONTENTS?,

B. CAN ANY OF THE CONTENTS BE TR aMgtr ' : ' PPFr>

C. WHEN WERE THEY LAST COMPLETELY REVIEWED FOR. TRANSFER?

D. WHAT IS THE PRESENT OVERFLOW (IN INCHES) WHICH CANNOT BE PROVIDED FOR BY TRANSFERRING C

INTO WOOD DttAWE* TRANSFER CASES, THIf SHOULD ft CHECKCO VKKY CLOSELY).

f. HAS IT BEEN DEFINITELY DETERMINED THAT THERE IS NO SURPLUS FURNITURE THAT COULD BE REPAIRED. CLEANED. OR REFINISHEO TO FIU

THIS PFOIIIPFMPKiT* .......

7. APART FROM MATCHING COLOR AND DESIGN OF PRESENT FURNITURE. WOULD USED FURNITURE BE SUITABLE? ,

0. HAS CONSIDERATION BEEN GIVEN TO POSSIBLE RE -ARRANGEMENT OF PRESENT FURNITURE AND STAFF TO SAVE THIS EXPENDITURE?

,N8tRUCTlONS FOR USE OF THIS FORM

THIS FORM IS TO BE ATTACHED TO ALL REQUISITIONS FOR OFFICE FURNITURE.
MANUFACTURERS' NAME SHOULD NOT BE SHOWN ON REQUISITION.
GIVE AS MUCH INFORMATION AS POSSIBLE IN ANSWER TO THE ABOVE QUESTIONS
IK MORE SPACE REQUIRED. MARK -OVER- AND USE BACK OF FORM.

Courtesy Canadian National Railways

Figure 101. Form for requisitioning office furniture of Canadian National
Railways.

When all the necessary information has been secured, each case requiring
investigation is individually considered by the Office Services staff. This in-
cludes a check against the surplus inventory record to determine whether
the article is on hand or must be purchased and reference to the Office Equip-
ment Standards File. Where necessary, comparative tests of competitive
products are conducted, the practice of running two independent tests for

300 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

checking purposes being followed in most cases. After full investigation, a
digest report, containing definite reasons why the requisition should or should
not be approved, how it can be filled within the standards at the least
expense to the railroad, including costs, savings and suggested action to be
taken, is prepared by the Manager of Office Services and submitted to the
Office of the President or the Vice-President in duplicate for formal approval.
Usually the duplicate is returned "approved," when a notation is made on
it as to the estimated savings, if any, from the transaction for entry in the
Savings Record Book and the new standards, if any, are entered in the Office
Equipment Standards File.

The procedure as described has been used by this Company over a period
of several years and has resulted in an estimated saving of more than 15 per
cent of the total value of the items involved in over one thousand requisitions
handled during that time. The plan of providing for the uniform and com-
plete presentation of the supporting data required has facilitated executive
action and permitted better informed decisions as to whether (a) the pur-
chase should be approved, (b) less expensive but equally suitable equip-
ment should be substituted, (c) idle or surplus equipment should be trans-
ferred, or (d) the request should be cancelled.

QUALIFICATIONS FOR SUCCESSFUL SYSTEMS MEN

What qualifications are desirable for systems work? How can the
systems department supervisors distinguish between those likely to suc-
ceed and those who will undoubtedly fail to achieve desired results in
systems analysis? How can a person measure his own qualifications for
a systems position?

There is no magic formula for the correct combination of attributes
which will result in a successful systems analyst. The descriptions of
the systems techniques presented in this book should give you a
general idea of the kind of qualifications which will prove helpful.
However, some aspects of systems work partake of the nature of an art
rather than a science. Many unusual combinations of various qualifica-
tions may therefore be valuable in systems work.

Some of the generally desired qualifications for systems work are
presented here. To some extent, they summarize the work of the sys-
tems analyst. The order of presentation is not in any way related to an
evaluation of the relative importance of these characteristics.

The analyst should have an analytical mind to enable him to probe to
the essential elements of a problem. The analytical mind simplifies the
problem by eliminating all superfluities from consideration.

Having reduced the problem to its essential elements, he will want to
be able to reason logically, to understand cause and effect relationships.

THE SYSTEMS FUNCTIONS AND CONTROLS 301

The systems analyst must always be a skeptic. He must not accept
hearsay information without verification. He must be critical of all
procedures and operating methods. He should be eternally curious:
Why is this done? Where does that originate? Why can't it be done
another way? He must have a naturally inquisitive instinct and desire
for knowledge.

He must be resourceful and imaginative to be able to strike out in
new paths, to be able to project himself into undiscovered fields, and
into future possibilities.

The analyst should have the ability to keep things in their true, broad
perspective to be able to distinguish the forest from the trees.

He must have objective, unbiased attitudes. His mind must be
flexible, open, and ready to be logically convinced of the best answer.

He must understand people, sympathize with their problems, and
possess the tact necessary to cooperate and convince effectively. The
importance of these characteristics was repeatedly illustrated in the
preceding chapters describing some of the problems of the analyst in
conducting his investigation.

The systems man must be open-minded and honest, with himself and
with others. This characteristic will display itself in a number of ways:
he will not delude himself into considering his own proposals as the
best at all times; he will give credit to other people for whatever con-
tributions they make towards the perfection of the system he is work-
ing on.

He should be able to express himself convincingly, orally, in writing,
and graphically. Much of the systems investigation is done by word of
mouth and a large part of the selling job in systems work is done
verbally. To assure common understanding of systems facts and pro-
cedures and effectively to present proposals for systems changes, facility
in composition is important. Since graphic analysis and presentation
can often clearly summarize in a readily grasped form many pages of
complicated written material, skill in the graphic arts may be a valuable
aid to the analyst.

Finally, he must possess a drive which will enable him to continue
in his tasks despite discouragements, defeats, and necessary com-
promises. He must possess a firm realization that improvements result
from constant hard work in the application of sound principles.

302

SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

APPENDIX A*

The following example is taken from the introduction to one of the
general standard practice instructions of a well-known engineering and
manufacturing enterprise. It illustrates the scope and organization of a
complete manual system.

STANDARD PRACTICE
INSTRUCTIONS

Page
Iof4

Classification No.
1.A.2

General Standard Practice
Instructions

Date Issued

By order of

Supersedes

Distribution

Subject

THE COMPANY'S SYSTEM OF MANUALS

CONTENTS
I GENERAL

II MANUALS OF SUPERVISORY GUIDANCE AND
INSTRUCTION

A. General Manuals

B. Divisional and Departmental Manuals
III TECHNICAL MANUALS

* From Reading Course in Executive Technique, Section I, Volume 4, R. E. Gill-
mor, A Practical Manual of Organization, pages 53-56. Used by permission of
Funk & Wagnalls Company.

THE SYSTEMS FUNCTIONS AND CONTROLS 303

I GENERAL

The Company's system of manuals consists of several sets of
written instructions and information on policies, procedures,
responsibilities, and standards which are prepared and approved
by positions of recognized authority. Each set of instructions is
issued in a binder to the supervisory personnel and, in some cases,
to the operating personnel whose activities the manual governs.
The structure of Company manuals can be divided into two basic
groups: first, manuals of supervisory guidance and instruction;
second, technical manuals.

II MANUALS OF SUPERVISORY GUIDANCE AND
INSTRUCTION

As a group, these manuals contain instructions and information
concerning policies; organization structure; the responsibilities of
specific positions; operating routines, records, and reports; equip-
ment, personnel, and other standards or specifications; and rules
or regulations. Such manuals may govern the entire Company or
they may be only departmental or divisional in scope.
A. General Manuals: Following is a description of the scope of
each manual governing the entire Company.

1. The General Standard Practice Instructions Manualsee
statement of scope and purpose in SPI I.A.I, "Introduc-
tion to General Standard Practice Instructions Manual."

2. The Organization Manual contains organization charts of
all supervisory positions within the Company, a definition
of the responsibilities of each supervisory position and the
responsibilities common to all positions, and statements of
the relationship between positions.

3. The Salary and Wage Administration Manual contains
approved occupational titles and definitions of salaried
and hourly occupations. Occupational definitions or speci-
fications consist of a statement of the duties, skills, and
experience required in the occupation. The manual is
used as an aid in selecting applicants for jobs, in establish-
ing salary ranges, and as a basis for determining eligibility
for promotion.

4. The Standard Equipment Manual contains purchase spe-
cifications for office furniture and equipment and other

304 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

capital items which can be used interchangeably between
divisions and which have been standardized for purposes
of economy and uniformity of appearance.
5. The Secretary's Manual contains selected General SPIs
and other instructions regarding filing, preparation of
correspondence, interoffice mail, and related subjects.
This manual is prepared for the guidance and instruction
of all secretarial and stenographic personnel.
B. Divisional and Departmental Manuals: These manuals gen-
erally contain instructions regarding those procedures, rec-
ords, and reports which must be carried out, maintained, or
prepared by personnel of one division or one department
only. However, the material contained in these manuals is
necessarily interwoven with other departmental manuals and
with general policies and procedures. Following is a list of
the Company's departmental manuals:

1. The Accounting Manual contains a chart of accounts
which governs the capital and expense charges of the
entire Company. Other sections (e.g., general accounting
section, cost accounting section, and timekeeping section)
are departmental in scope.

2. Engineering SPI Manual

3. Emergency Facilities Instruction Manual

4. Guards Manual

5. Inspection SPI Manual

6. Methods SPI Manual

7. Personnel Department SPI Manual

8. Production Control SPI Manual

III TECHNICAL MANUALS

The Company's technical manuals contain such information as
materials specifications, standard contract clauses, maintenance
and repair instructions, etc. The following constitute the Com-
pany's group of technical manuals:

1. Contracts Summary Manual

2. Field Service Manual

3. Standard Parts Manual

THE SYSTEMS FUNCTIONS AND CONTROLS 305

APPENDIX B

AMERICAN MACHINE & FOUNDRY COMPANY

STANDARD PRACTICE INSTRUCTIONS 8 . P. t. NO. 1JL.1

PAGE i OF 4
TITLE: DEVELOPMENT, APPROVAL & ISSUANCE OF SPI's

REV. NO. 2 OF 1-1-

EFFECTIVE AT Company Wide

EFFECTIVE . .
APPROVED BY: M. PATTERSON DATS JU/J/47

PSSUED 11AA7

These instructions are effective immediately upon receipt and they supersede SFI
1-1-0, issued 4/8/47 and all other relative material previously issued.

PURPOSES To revise and clarify the authorized method of developing,
coordinating, approving and issuing Standard Practice
Instructions.

! SCOPE & PURPOSE OF THE MANUAL

The AMP Standard Practice Instruction Manual will contain the following types
of materials

a. Statements of the Company's objectives and policies*

b. Charts of the Company's Organization structure and descriptions
of departmental responsibilities.

Co Descriptions of standards and specifications established to

facilitate and control basic company activities .
do Descriptions of repetitive procedures in which two or more Offices,

Divisions, or Departments participate*

This Manual of instructions is designed to achieve the following objectives I

a. To promote common understanding of Company objectives.

b. To insure uniformity in the interpretation and administration
of all Company policies.

c. To eliminate unnecessary duplication of records and activities.

d. To assist in coordinating the activities of Offices, Divisions, and
Departments of the Company.

e. To provide a basis for effecting Management control of Company activities.

f . To serve as a medium for training supervisory members of the Organization*
g To encourage constant review and improvement of policies p ;

practices and procedures.

2. HOV.SPI^s WILL BE DEVELOPED

The Procedures Manager, under the direction of the Corporate Secretary, will
assist Vice Presidents, General Managers and their designees in the preparation
of requested SPI's. The Head of each Division and Office will develop & master
list of SPI's required for his activities and assign a member of his staff to
develop the basic material required to prepare these SPI's. The Corporate
Secretary upon request, will have this material written in SPI form and will
then arrange for the final approval and distribution of the instructions.

t. WRITE . f. I. TITLC AND NUMBER IN MANUAL INDEX.

>. riUt THIS f. P. I. IN MANUAL . SECTION 1. KOUtNCt A.I

. REI40V* OBOLIT *, f. I. NO. OATKD AND DMTRPY IT.

306 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

AMERICAN MACHINE A FOUNDRY COMPANY

STANDARD PRACTICE INSTRUCTIONS NO, i^.l

REVISION NO. OFPAOC PAOI 2 OF

The Procedures Manager will analyze an existing procedure or system, upon
request, for the purpose of proposing improvements and ultiaately pre-
-paring and issuing applicable instructions in SPI form.

3 HOV SPI'S WILL BE APPROVED

The 'Procedures Manager will contact "all supervisory personnel concerned
to obtain their concurrance on what is being written* After all con-
currences have been obtained, he will forward the final SPI draft and a
list of the names of those who have concurred, to the Corporate Secretary
who in turn will forward the SPI to the President or appropriate Vice
President or General Manager with a recommendation that it be approved for
final issue

SPI 1 will be issued over either the signature of the President, a Vice
President or a General Manager, whichever is appropriate.

All Offices and Divisions, except the Pinspotters Division which has an esta-
blished Procedure Staff, will clear their SPI drafts through the Corporate
Secretary before final issue The Pinspotters Division will clear only those
SPI drafts through the Corporate Secretary which involve the establishment
or revision of a company policy or a procedure which affects other Offices or
Divisions, in which case tha Corporate Secretary will coordinate management
approval of the SPI* Copies of all Pinspotters SPI 9 a will be forwarded to the
Procedures Manager for distribution to holders of Master Manuals at other
locations*

The Procedures Manager is responsible for seeing that the knowledge and ex-
perience of all supervisory personnel is utilized In preparing an SPI and
where major differences of opinion cannot be reconciled among those concerned,
he will refer the policy or procedural problem to the Corporate Secretary
for decision from the management*

4. HOW SPI* 5 WILL BE ClASSIFIEP

The identifying classification of 'each Standard Practice Instruction consists
of three parts, separated by a period* For example, S.P.I* 12JB.1.

Jg denotes the section of the manual In which the SoP.I. IB iiled.
(The sections are listed In the Table of Contents)

S denotes the group in section 12 in which the S.P.I. Is filed*
2 denotes the sequence within group E in which the SPI is filed.
hence

12 s Manufacturing Division cectlon of Manual
E s Quality Control group of Manufacturing Division S.P.I.' s
1 = 1st S.P.Io in Group E.

t, FILE THI* .F.I. IN MANUAL -BCT1ON J., CQUKNd Al

k. ItKMOVK OBVOLITCJj^trMOh OATCD AMD DCVTHOV IT.

THE SYSTEMS FUNCTIONS AND CONTROLS 307

AMERICAN MACHINE & FOUNDRY COMPANY

STANDARD PRACTICE INSTRUCTIONS NO . i oAa Z

PAGE 3.OF 4.

5 HOtf SPP S .WILL BE D ISTRIBOTED

The Procedures Manager will issue a Master Manual, containing a copy of al^
SPI'fl to the Chairman of the Beard, the President p the Corporate Secretary,
Vice President:^ General Manager s p Work Managers j to individuals assigned
to offices ci he above executives and to any other executives whose duties
require a knowledge of all Company policies and procedures,

A regular SPI Mar.ual (receiving selective distribution) will t issued to
all management and supervisory personnel net indicated above 9 and such
Manual Holders vill receive a copy of onl^ those SPl's that relate speci-
fically to th^ijr activities.

All cc-piea of Standard Practice Instructions will be distributed through the
regular lino of organization in Order that Executives and Supervisors may trans-
mit the instructions directly to their subordinates,

BOf SPI' S WILL BE

Where necessary to effect, thorough installation of procedures and systems, the
appropriate executive will conduct individual or group training activities at
the time the Standard Practice Instructions are iasuedo Upon request the Pro-
cedures Manager will be available to assist all executives in this worko

7, pOtf SPI'S WILL BE EVALUATED

The check list for determining the effectiveness of each SPI will bes
a. Has it simplified methods and clarified policies?

b Does it effect maximum standardisation of policies and operations
at all company locations?

o Is it sufficiently detailed and presented in comprehensive form?

8, pTORlM INSTRUCTIONS

The development and publication of policies and procedures is a constant
function of executive and supervisory personnel and it is recognized that
the Procedure Staff cannot always meet the SPI s*hedule=demands of the
Organization* Hence, where necessary to expedite issuance cf an order,, any
supervisory employes may issue, within the 15nits of hi/ authcrity, an interim
policy or procedure in the form of a mem;>, bulletin or letter* A c'-py of all
such material will be forwarded to the Procedures Manager w*o f upoa request
and proper authorization, will schedule the preparation of the interim in-
structions in final SPI form. The Procedures Manager will be available to
assist executive and. supervisory personnel in the preparation of interim
instmctionso

9o ORGANIZATION ANNOUNCEMENTS,

Section 2 of this manual contains an organization chart of the basic company

1 ..... NOTICE ..... " " .......

I. PILK THI> . P. I. IN MANUAL 9CCTION tLc SCQUINC* Aol

ft, KEMOVC OB0OUETK . P. I. NO. DATED AND DESTROY IT.

308 SYSTEMS ANALYSIS FOR EFFECTIVE ADMINISTRATION

AMERICAN MACHINE & FOUNDRY COMPANY

STANDARD PRACTICE INSTRUCTIONS NO. i oA .i

REVISION NO, OP PAGE PAGE ^OP

structure and a description of the functions of each Office and Division within
this structure. All other sections contain detailed organization charts and
departmental descriptions pertaining to the applicable Office or Division.
These charts and descriptions are designed to permit a number of current
organization changes to be noted thereon by the Manual holder as changes
are announced*

All organization changes will be announced on an Organization Bulletin, which
will provide the necessary information needed to make change-notes on the
applicable organization material in the SPI manual.

The Procedures Manager will issue revised charts and descriptions as often ftfl
necessary to keep this data free from excessive notes.

All organization changes will be announced by means of the Organization
Bulletin and all requests to issue thi* bulletin will be forwarded to the
Procedures Manager who will ascertain that the requested change has been
properly approved and will then prepare and issue the "bulletin over the
proper signature o

Organization dianges in the Pinspotters Division will be issued -directly from
that Division with copies supplied to the Procedures Manager for distribution
to holders of master manuals at other locations*

RESPONSIBILITY OF MANUAL HOLDERS

a* Persons holding copies of Standard Practice Instruction Manuals are re*
sponsiblo for keeping their manuals in orderly, usable condition and for
inserting new material as soon as it is received . All SPI's will be
filed and indexed -in the manual in accordance with the instructions given
on the bottom of each SPI page<> The Procedures Manager will issue a
revised index periodically in order that all manual holders may audit their
manuals to see that they are complete and in order

b. Each manual holder will make his manual readily available to his aubordt*
nates for reference, and will instruct them in the purpose and use of
Standard Practice Instructions*

C. Standard Practice Instruction manuals are Company property and are not
transferable. Therefore, whenever a manual holder leaves the Company
or is transferred to another department, his superior is responsible
for returning that person's manual to the Procedures Manager.

NOTICE

I. riLK THIS S.P.I. IN MANUAL* SECTION lo SCQU(NC A?l

Jt, RIMQVK OBSeUW *. P' l> NO. DATED, AND DESTROY IT.

INDEX

Figures in italics refer to illustrations

accounting department, 107, 186,

243
accounts and finance department,

64

acoustics, 131
activity analysis chart, 46, 74-83, 84,

85, 263

Alignment Charts (Kraitchik), 201n
American Machine and Foundry,

281, 305-308
American Management Association,

230n, 292n

American Society of Mechanical En-
gineers, 98
analysis, of functional assignments

and systems flow, 57-112
of record usage, 195
analytic technique, basic approach,

58
analysts, types of, 2

qualifications for, 300-301
Appraisal and Control of Duplicating

Service, 204n
Art o j ^ Plain Talk, The (Flesch),

244n
Art of Readable Writing, The

(Flesch), 244n
auditing procedure, 260
authorities, assignment of, 18
automaticity of system, 27

Barnes, R. M., 140n, 143

basic analytic approach, 58

bill of material, 68

Browning, Philip Y. (quoted), 115

Budd Manufacturing Co., The, 181,

182-183
Bulletin of the National Association

of Cost Accountants, 4

Bureau of Training of the War Man-
power Commission, 263
business failures, causes of, 1
poor systems as factors in, 6

Canadian National Railways, 295,

296-299

centralization, 20-23
advantages of, 20
operation, 21, 22-23, 64
certification unit, procedure of, 103
chain of command, 27, 64
chart symbols. See symbols
charted systems flows, 57-112
charting technique, 112
charts analysis, 181
classification system, 284
combining forms, 160-161
committee organizational structure,

23, 25

communication lines, 115
consultant, lighting, 131
control functions, 16, 19
correlation chart, 75, 161

See also organizational flow chart;

organizational process flow chart
cost comparisons, 215ff
cost estimating procedure, 246-253
cost savings, clerical, 4
cross-indexing file, 289
C-Thru Ruler Co., 88
Cybernetics (Wiener), 203n

daily production record, 34
"Daily Report of Goods Received,"

185
decentralization, advantages of, 20

operation, 21, 22-23, 64
definition of sytems analysis, 2

309

310

delegation of responsibilities, 28
department analysis chart, 86, 87
departments, allocation of areas,

126

design-engineering, 68-69, 72-74
manufacturing, 114
systems, 38, 243, 267-300
design-engineering department, 68-

69, 72-74
distribution pattern of forms, 105-

112
"Don't Be Fooled by Erroneous Cost

Studies" (Barish),216n
duplicating, equipment, 204ff

guide to processes, 210
duties questionnaire, 45-46
Dvorak-Dealey simplified typewriter
keyboard, 194

effective selling, 231-234
efficiency, levels of, 216-217
element of motion, 137
Elements of tomography (Douglass

and Adams), 201n
employees, analysis of duties, 80

location in office, 130

motion study of, 137ff

motivations, 230-231

productivity of, 33, 35
employee utilization chart, 34
environment, office, 131
equipment, control, 293

duplicating, 204

electrical staplers, 212

file, 293-294

mechanical graphs, 211

microfilming, 200

planning board, 211

printing, 204

punched-card, 203

requisitioning, 294-295

review, 295

sorting, 203

standards, 294

INDEX

synchronizing, with personnel,

190ff

types of, 198-212
utilization of, 34, 189-190
See also machines; office equip-
ment

fact-finding, 31-56

files and filing methods, 198

analysis of, 195, 196

data and symbols, 164

visible, 165

See also office equipment
financial and statistical reports as sur-
vey data, 38
Flesch, R., 244-245
flexibility, of lay-out, 116

of systems, 25-26
floor plans, 125
follow-up, systems, 272-274
football, 113
forms, arrangement of, 161, 162

colored papers, 166-167

combining, 160-161

control, 166, 286-287

cross-indexing file~289

economical size for, 168 (table)

error potentialities, 162-163

for equipment practices, 36

file, 38, 164-165

headings and instructions, 164

inventory control of, 4, 287

kinds of, 173-187

numbering procedure, 287

ordering procedures, 289

ordering quantities, 170

receiving and inspection, 184

for recording data, 33

registers, automatic locking, 211

request, 290

requisition data, 298, 299

for running record of material re-
ceipts, 162

savings in, 186

INDEX

serial numbering, 165
sizes of paper, 167
title of, 166
type style, 171

weight and grade of paper, 169
forms data correlation chart, 161
forms designs, 9, 159-187
analysis of, 159-187
check list, 179
defined, 159
vertical and horizontal spacing,

163ff
forms distribution charts, 105-112,

263

bill of lading, 108, 109
questionnaire, 110
routing of various documents, 111
stores requisition procedure, 106,

107

forms functional analysis chart, 288
Foster, R. L., 121
functional allocations, analysis of,

57-112

functional classification, 284, 285
functions, centralized, 21
decentralized, 21
delegation of, 28
elimination of duplication in, 20
in a good system, 15-19
grouping of, 14, 15, 16, 17
systems-control, 12, 19, 267-291
systems investigation, 12
functions allocation chart, 59-65, 66,

67

analysis of, 62
furniture, office, 198ff

General Foods Corp., 192, 193
Gilbreth, F. B., 137

Hanimermill Paper Co., 291
Handbook of Business Administra-
tion, 257n
Harrison, E. R., 4n

311
Hartford-Empire Co., 184, 185

importance of systems, 5
imposition of systems decisions, 270
Index of Nomograms, An (Adams),

201n

induction papers, 100
industrial engineers, 268
inspection report, 185
installation methods, 255
installation of systems, 264-265
instruction chart, 259
instructional charts, use of, 263
International Business Machines Co.,

203

interview, case illustrations, 47-56
interviewing, principles of, 4 Iff

procedures, 41-56
inventories, lowering of, 3
inventory-control activities, sample

analysis, 80
inventory-control department, 19,

68,74

inventory-control record cards, 83
inventory records, 106
investigation, systems, 8-12

interaction of functions, 12

phases of, 8-9

steps in, 10-11

types of, 9-10

Johnson, Samuel (quoted), 232

laboratory pay record, 166
lay-out, analysis of, 113-135

conservation of space, 115

factory, 114

flexibility, 116

importance of, 114

model, 134

office, 132, 133

office, private, 131

preparation of, 126-130

space categories, 124

312

templates, 127, 128, 129

types of, 10
lay-out control, 292
lay-out flow chart, 120, 130, 132, 133
Leffingwell, W. H., 257
"Let's Look at the Record" (Har-
rison), 4n
Life Was Worth Living (Robertson),

234n

lighting, office, 131
line organization, 23-25

machines, addressing, 211

automatic locking forms register,
211

autotype, 192

billing and bookkeeping, 202

computing, 201

contact photocopy, 209

dictating, 202

duplicating, 213

envelope sealing, 212

filling and inserting, 212

folding, 212

hectograph process, 207-208

linograph composing, 205

lithographic or planographic, 205

mechanical collators, 203

photostat, 209

projection photocopy, 209

rotary-relief process, 207

stapling, 213

stencil process, 207

typewriter, 193, 194

See also equipment; office equip-
ment

machine utilization chart, 35
machine utilization, analysis, 188-

213

Macy's, 184
management, control of, 2

engineer, 2

Management Guide (Standard Oil
Co. of California), 274, 275

INDEX

manuals, organization, 28, 272, 274-

276

procedural, 28, 289, 302-308
material-control department, 16
methods department, 38
methods-engineering department,

68-69, 72, 74
methods study, 2
Metropolitan Life Insurance Co.,

129, 295n

micromotion, analysis of, 151, 157
analysis sheet, 156
photographic study, 137
study, 154-158

Simo chart, 157

Moore Business Forms, 182-183
Motion and Time Study (Barnes),

140n, 156, 157
motion economy, analysis of, 136-

157

application of principles in, 194
in forms design, 161
principles, 137-145
types of analysis, 10
use of right-and-left-hand charts,

146-151

motion elements, size of, 150-151
motion patterns, 4, 9, 137-143, 151,

158

motion pictures, of activity and work-
place area, 154
multiple activity process chart, 191,

192, 193

Mutual Life Insurance Co., 292
My First Years as a Frenchwoman

(Waddington), 234n
My Memories of Eighty Years
(Depew), 233n

National Association of Cost Ac-
countants, Bulletin of, 4
National Business Show, 213
National Office Management Associ-
ation, 121

INDEX

New Readability Yardstick, A

(Flesch), 244n
New York Times, 213
nomograph, 20 In
Nomography (Levens), 201n

office, environment, 131

lay-out, 114-135

open work areas, 117-118

private, 117-119

office equipment, advantages from
use of, 189-190

best-suited, 190

construction, 194

control of, 293

control procedure, 197

design, 194

economy study, 197

files, 199, 293

kinds of, 189, 203-211

labor-saving, 188-189

placement of, 38

printing and duplicating, 204

punched cards, 203

requisitioning of, 294

sorting, 203

standardization of, 190

standards, 294

synchronization, 190

types of, 198

utilization, 34

visible file, 200

See also equipment; machines
Office Equipment Digest, 120n
office furniture inventory, 296
office machines inventory form, 295
Office Management, 292n
office space requirements, 130
operating efficiency, 2
operator charts, 264
ordering quantities of forms, 170
organization chart, pure line, 24

pure staff, 24

relation to procedure, 13

313

typical, 276, 277
organization allocation chart, 65
organizational location of system,

268-270
organizational flow chart, 65-74,

101-105
use of pictorial symbols in, 260-

261
organizational process flow chart,

101-105
analysis of certification procedure,

102

procedure for answering credit in-
quiries, 104
organizational structure, centralized,

20-23

committee, 23-25
decentralized, 20-23
length, 27
line, 23-25
receiving and purchasing function,

17

staff, 23-25
width, 27

organization manual, 274-276
overlap of responsibilities, 19

packaging code, 69-74
paper, standard sizes, 167

weight and grade, 169
Pennsylvania Railroad, 233
personalities, effect on system, 26-27
personnel, activities of, 75

adjustments because of systems
changes, 270-277

changes in, 119

fallibilities of, 29-30

reduction of, 190

specialized, 6, 26

synchronizing with equipment,
190

transfer, 190

utilization, 34
personnel record, 166

314

pictorial flow chart, 264
pictorial forms distribution chart,

262-263
planning, 31-56

boards and mechanical graphs, 211

department, 68, 72, 74
plant-accounting department, 20
poor systems, causes of, 6-7
printing specification form, 290
private offices, 117
procedural manual, 28
procedures, defined, 3

elements of, 238

establishment of, 26

operating, 2

ordering, 289

writing systems reports and, 233-
245, 246-253, 302-308

See also systems and procedures

analysis

procedures control, 281-285
process chart, 87-101, 263

analysis of, 90

construction of, 88

elaboration of, 94

form of, 95

of induction papers, 100

metric rule and stencil cut-out
templates, 88

multiple activity, 192

process analysis chart, 95, 96

of requisition for supplies, 101

standards for construction, 98
process flow chart, organizational,

101, 102, 103, 104
procurement* department, 239
production and shipping schedule, 68
production-control activities, 216

department, 20, 216, 242

service, 216-217

system, 40

production-control head, 216
production engineers, 114
production-planning department, 64

INDEX

production tabulation sheet, 35

project control, 278-279

project folders, 270

project register, 279

project reports, final, 280-281

project status and summary records,

279-280

public accessibility, 115
purchase requisitions, 69, 72
purchasing department, 64-72

function, 18
purchasing office, 15

Quartermaster Control Officers

Handbook, 47n
questionnaire, 43-46, 78, 110

duties, 45

reports, 44

Radio Corporation of America, 163,
240, 246-253, 259, 283, 284-
235, 290

receiving department, 15
receiving report, 186
record analysis of usage, 196
records, inventory, 106

project status and summary, 279-

280

transcription to new, 254-256
Remington-Rand, Inc., 96-97, 111,

127, 128, 264
report data sheet, 37
reports, analysis of, 181
elements of, 235-237
potential efficiency of, 245
reports list, 36
reports questionnaire, 44
reproduction equipment, analysis of,

196

request form, 290

responsibilities, assignment of, 18, 19
right-and-left-hand chart, 146-151,

155
analysis of, 146

INDEX

construction of, 150

illustrative analysis, 147

method of collating and stapling,
148

proposed improvements, 149

symbols used in, 146
Ripnen, Kenneth H., 120-121
Ross, H. J., 39

scale models, 130-131, 133

scope of systems investigation, 8-10,

32

selling a new system, 229-234
shipping department, 68, 72-73
shop order status record, 163
Simo chart, 156, 157
simple duties questionnaire, 45
slide rule, 201
Smith, Everett R., 230
space conservation, 115
space requirements, estimating of,

121-125
forecasting, 125
key, 122

in office lay-out, 120-130
standards of, 120-124
worksheet for computation of, 124
"Space Standards in the Office Lay-
out" (Ripnen), 120n
span of control, 27, 64
staff or functional organization, 23,

24,25
"Standardizing Forms Control"

(Krauss), 292n
"Standardizing Office Forms and

Equipment," 295n
Standard Oil Co. of California, 274,

275
Standard Register Co., 95, 184, 262,

263

standards for personnel space cate-
gories, 124

stopgap, measures, 262
systems, 7

315
stopwatch, 154

time study, 151
stores department, 69, 72
stores requisition procedure, 107
structure, committee organization, 25

line organization, 23

organizational and procedural, 3,
13-14, 26, 113

types of organizational, 23
style, clarity and effectiveness in,

240-244

supervisor training, 12, 281-282
surplus stores equipment form, 297
survey, steps in systems, 10-11
symbols, 87, 94-96, 105

filing data, 164

procedure, 263-264

for therbligs, 155

use, of pictorial, 259-260
in procedure charts, 98-99
in process charts, 87, 88
in right-and-left-hand charts,

146
systems, automaticity of, 27

control functions, 267-304

defined, 3

evaluation of, 215-229

flexibility in, 25-26

flow, 57-112

importance today, 5

installation of, 254-265

interviewing procedures in, 41

investigation, 8-12

poor, 6-7

principles of good, 13-30

redesign of, 7

scientific method, 29

selection and selling new, 215-

234
systems analysis, cost of, 215

critical approach to, 33

key questions in, 59

recording data, 33

supervisor training in, 271-272

316

systems analyst, hostility toward, 39-
41

qualifications for, 299-301
systems and procedures analysis, 2-4
systems data, 31-38, 43-46

accuracy of, 33

recording of, 33-36

sources of, 36-38

techniques for organizing, 57
systems department, 38, 243, 269

authority of, 270

equipment-control function of, 295

functions of, 267-274

organization of, 274-300
systems evaluation worksheet, 228
systems flow, 9

analysis of, 57-112

cross references, 239

types of analysis, 10
systems function, 6

centralized, 269

control of, 272

decentralized, 268

in one-man business, 5
systems investigation, schedule of, 32

scope of, 8-10

steps in, 10-11

systems reports and procedures, writ-
ing, 235-245
systems survey, 8

See also systems investigation
systems techniques, application of, 3

benefits of, 3

diagrammatic representation, 11

tabular reports list sheet, 36
Technique of Systems and Proce-
dures (Ross), 39n

INDEX

techniques, charting, 112
demonstration, 262
systems-charting, 237

technological changes, 227

technology, use in office, 212-213

templates, 126-129

therbligs, 155

time study analysis, 151-153, 217

time study sheets, 152

timetable, 254-255, 271

training, principles, 256-257
techniques, 257-258

"Training within Industry Report,"
264n

Training within Industry Service, 263

transcribing records, 255-256

type style, 171

Typewriter Behavior, Psychology
Applied to Teaching and Learn-
ing Typewriting ( Dvorak) ,
194n

typical organization chart, 277

Visual Production Planning, Inc., 134

War Manpower Commission, Bureau

of Training, 263
"What the Wage Earner Thinks"

(Smith), 230n
work areas, advantage of open areas,

117-118

for clerical worker, 144
for mail clerk, 145
working conditions, 119, 131
writing, effectiveness of, 244-245

"Yardsticks of Business Practice,"
121n