Automation of America's Offices, 1985-2000

December 1985

NTIS order #PB86-185055 Recommended Citation: U.S. Congress, Office of Technology Assessment, Automation of America Offices (Washington, DC: U.S. Government Printing Office, OTA-CIT-287, December 1985).

Library of Congress Catalog Card Number 85-600623

For sale by the Superintendent of Documents U.S. Government Printing Office, Washington, DC 20402 .

Foreword

Automation of America Offices, 1985-2000, assesses the consequences of the continuing and rapid introduction of information and telecommunications technologies in offices: the workplace of about 45 million Americans. The use of computers and new communication systems in offices is bringing about fundamental changes in employment patterns, the skills needed for white-collar occupations, and the quality of worklife and the office environment. These changes will affect all industry sectors, since office work is a growing component of every industry as well as all public sector organizations. The study, requested by the Senate Committee on Labor and Human Re- sources and the House Committee on Education and Labor, will also be of interest to many other congressional committees because it addresses a wide range of subjects of concern to industry, government, and educational institutions, and to employers, employees, and their organizations. OTA wishes to thank the many people and organizations that contributed to this assessment through advisory panels, workshops, interviews, and other means of sharing their information and experience with us. The final responsibility for the study, however, rests with OTA.

Director

///. . Automation of America’s Offices Advisory Panel

Charles E. Branscomb Henry C. Lucas Vice President, Telecommunications Chairman Communication Products Division Department of Computer Applications and IBM Corp. Information Systems Graduate School of Business Dennis Chamot New York University Associate Director Department for Professional Employees Lois Martin AFL-CIO Processing Services Director FBS Information Services Robert L. Chartrand Senior Specialist Karen Nussbaum Congressional Research Service Executive Director Library of Congress Nine-to-Five: National Association of Working Women Marvin Dainoff Professor of Psychology Robert M. Peabody Miami University Assistant Vice President and Director of Office Automation Rosalyn L. Feldberg Mutual of Omaha Visiting Research Scholar Henry A. Murray Research Center Randy J. Pile, Jr. Radcliffe College Department Head AT&T Information Services Thomas G, Hermann Chairman, Law Office Technology Committee Robert Ellis Smith American Bar Association Editor and Owner Squire, Sanders, and Dempsey Privacy Journal Robert C. Hughes Vernell K. Munson Sutherland Vice President and Group Manager President Business and Office Systems Marketing Knowledge Systems Digital Equipment Corp. Ralph E. Upton, Jr. Barbara B. Hutchinson Director Director, Women’s Division St. Augustine Technical Center The American Federation of Government Employees

iv Automation of America’s Offices: OTA Assessment Staff

John Andelin, Assistant Director, OTA Science, Information, and Natural Resources Division

Fred W. Weingarten, Program Manager Communication and Information Technologies Program

Project Staff Vary T. Coates, Project Director Benjamin C. Amick III, Analyst Marjory S, Blumenthal, Analyst Janet DeMott, Detailee-DHHS M. Karen Gamble, Analyst Mary Ann Madison, Research Analyst Zalman Shaven, Senior Analyst

Administrative Staff Liz Emanuel Shirley Gayheart Patricia Keville Renee Lloyd Audrey Newman

Contractors and Consultants Eileen Appelbaum Christopher P. Astriab Alan Porter Georgia Tech Research Corp. Larry Hirschorn University of Pennsylvania Joan Greenbaum Institute for Labor Education and Research, Inc. Larry McClure Northwest Regional Educational Laboratory William Neufeld Jon Turner New York University Anne Posthuma University of Sussex, United Kingdom Tora Bikson Rand Corp. Kathleen Christensen Research Foundation of the City University of New York Leslie Schneider Harvard University, Kennedy School of Government Marlene Thorn IMT Associates Alan Westin Educational Fund for Individual Rights Office Automation in Federal Agencies Lewis B. Arnold Tom Kurihara Systems Policy Staff, Office of Information U.S. Department of Transportation Technology Christos Kyriazi Justice Management Division Management Information Services U.S. Department of Justice U.S. Department of Commerce K, C. Bacher Alan Kotok HQ/USAF/DAX Chief of Planning and Development Staff The Pentagon U.S. Information Agency Ross Bainbridge Coyeen Lawton Information Resources Office of the Assistant Secretary for Administration U.S. General Accounting Office and Management Roger Bullock U.S. Department of Labor Director, Information Resources Barry Leonard Federal Maritime Commission Acting Director, Foreign Affairs Data Processing Eliot Christian Center Office of the Associate Administrator for U.S. Department of State Information Resources Management Howard E. Lewis Veterans Administration Director of Information Systems ‘Claire Dolan U.S. Department of Energy Human Resource Management Analyst Steven Malphrus Internal Revenue Service Federal Reserve Board PM/HR/HRT Hal Niebel Barry L. Freedman Information Systems Office Manager, OMB Systems U.S. Department of State Automated Systems Division, Office of Administration Charles B. Newton Executive Office of the President Office of Information Resources Management Federal Emergency Management Agency Esther Georgatos Office of Data Management and Telecommunications Ern Reynolds Veterans Administration Special Assistant to the Deputy Undersecretary for Intergovernmental Affairs, Office Michael J. Gilbride of the Secretary Chief of the Office Automation Division (office of the Managing Director U.S. Department of Health and Human Services Federal Communications Commission Jack J. Sharkey Director, Office of Data Management and Carolyn Hahn Telecommunications U.S. Department of Transportation Veterans Administration Terrell Hicks John Strain Director of Management Systems Office of the Assistant Secretary, Program and Tennessee Valley Authority Resources Management Charles Hudnall U.S. Department of the Treasury Information Processing Staff, Office of the Wally Velander Assistant Director for Administration Office of the Associate Administrator for National Science Foundation Management David Johnson National Aeronautics and Space Administration Office of Information Resources Management Lydelle Wertheimer Agency for International Development Human Resources Technology Group H. Kasprzak Internal Revenue Service Department of the Army HqDA, DAIM-PSP

vi Office Automation Quality of Worklife Workshop

Nicholas Ashford Mary Murphree Director, Center for Policy Alternatives Regional Administrator, New York Women’s Bureau Massachusetts Institute of Technology U.S. Department of Labor Dean Baker Diana Roose Associate Professor, UCLA School of Public Health Research Director Center for Health Sciences Nine-to-Five Tora Bikson Jan Rowland Senior Scientist Epidemiologic Consultant Rand Corp. Art Rubin David Celentano Research Psychologist, Center for Building Department of Behavioral Science and Health Technology Education National Bureau of Standards School of Hygiene and Public Health The Johns Hopkins University Steven Sauter Section Chief, DHHS PHS CDC NIOSH Michael Delarco Applied Psychology and Ergonomics Branch Program Manager, Air, Toxics, and Radiation Monitoring Research Agency Lawrence Schleifer Stress & Motivation Research Section, DHHS PHS Ray Donnelly CDC NIOSH Occupational Safety and Health Administration Applied Psychology and Ergonomics Branch U.S. Department of Labor Tapas Sen Charles E. Grantham Division Manager, Human Resources Human-Technology Specialist, Local/Office Systems AT&T Honeywell, Inc. Richard P. Shore Judy Gregory Bureau of Labor Management Relations and Research Associate, Department for Professional Cooperative Programs Employees U.S. Department of Labor AFL-C1O Michael Smith Mary Haan Associate Professor, Department of Industrial University of California, Berkeley Engineering University of Wisconsin Bonnie Johnson Corporate Strategic Staff Jeanne Stellman Intel Associate Professor, School of Public Health Columbia University Susan Klitzman Division of Environmental Sciences, School of Public Jon Turner Health Department of Computer Applications and Columbia University Information Systems Graduate School of Business Philip Kraft New York University Center for Survey Research University of Massachusetts Hal Vreeland Center for Preventive Research Andrea LaCroix National Institute of Mental Health Post-Doctoral Fellow, Department of Epidemiology School of Hygiene and Public Health The Johns HQpkins University Charlotte LeGates Director of Communications Computer and Business Equipment Manufacturers Association

vii Reviewers and Other Contributors

Eileen Appelbaum Laura Johnson Temple University Social Planning Council of Metro Toronto Walt Baker IBM Corp. Judith Karnm Bentley College Tora Bikson Rand Corp. Kenneth Kraemer University of Southern California, Irvine Robert Bednarzik U.S. Department of Labor Charlotte LeGates Computer and Business Equipment Manufacturers Sharon Canter Association Manpower Temporary Services Dave LeGrande Kathleen Christensen Communications Workers of America City University of New York Dennis Little Steve Coil Merit Systems Protection Board Inc. Magazine Andrea Long Keith Cooley University of Michigan MSA Donald Marchand Gerald Davis University of South Carolina Harbinger Group, Inc. Robert Mason Jim Day Metrics Research Corp. Council of Vocational Educators James McInnerney William J. Dennis, Jr, IBM Corp. National Federation of Independent Businesses Charles McMillion Steven Deutsch House Committee on Small Business University of Oregon U.S. House of Representatives Claire Dolan Jack Mileski Internal Revenue Service Digital Equipment Corp. Colin Drury Mark Mueller SUNY, Buffalo AT&T Information Systems Claudia Goldin Mary Murphree University of Pennsylvania U.S. Department of Labor Joan Greenbaum Keith Nelms LaGuardia College Georgia Institute of Technology Bill Grenawalt William Neufeld Optical Coating Laboratory, Inc. Consultant Heidi Hartmann Gregory Nicklas National Research Council Communications Workers of America Ron Hertzfeld Norman Nissenoff National Council on Compensation Insurance Thierry J. Noyelle Margaret Hilton Columbia University Communications Workers of America Margrethe Olson Timothy L. Hunt New York University W. E. Upjohn Institute for Employment Research Olov Ostberg Jim Jackson Swedish Telecommunications Administration Prime Computer Bruce Phillips Bonnie Johnson Small Business Administration Intel

.,. VIII Joanne Pratt Michael Smith Joanne Pratt Associates University of Wisconsin David Roessner Wanda Smith Georgia Institute of Technology Hewlett-Packard Carol Romero Roberta Spalter-Roth National Commission for Employment Policy George Washington University Diana Roose Ronnie Straw Nine-to-Five: National Association of Working Communication Workers of America Women Sharon Szymanski Fred Rossini The Labor Institute Georgia Institute of Technology Jim Taylor Mike Roush Sociotechnicd Systems National Federation of Independent Businesses Thomas Taylor Arthur Rubin Mountain Bell National Bureau of Standards Maureen Tierny Peter Sassone AT&T Georgia Institute of Technology Jon Turner Steven Sauter New York University Robert A. Taft Laboratories Hal Vreeland William Scheirer National Institute of Mental Health Small Business Administration Steve Weyl Perry Schwartz Syntelligence Georgia Institute of Technology Frank White Tapas Sen Human Systems Incorp. AT&T Robert Yellowlees Phil Shelhaas American Telesystems Corp. IBM Corp. Richard P. Shore U.S. Department of Labor

OTA Reviewers

John Alic, Senior Analyst Eugene Frankel, Senior Analyst Gretchen Kolsrud, Program Manager Audrey Buyrn, Program Manager Linda Garcia, Analyst Karl Kronebusch, Analyst Wendell Fletcher, Senior Analyst Julie Gorte, Analyst Linda Roberts, Senior Analyst Contents

Chapter Page 1. The Outlook for Office Automation: 1985-2000 ...... 3 2. Productivity and Employment ...... 33 3. Training and Education for Office Automation ...... , 75 4. The Changing Nature of Office Work ...... 95 5. Office Automation and the Quality of Worklife ...... 125 6. Confidentiality and Security Issues With Office Automation...... 171 ‘i’. Home-Based Automated Office Work ...... 189 8. Off-Shore Office Work ...... 211 9. The Automation of Federal Government Offices ...... ,233 10. Office Automation in State and Local Governments...... 265 11. Office Automation in Small Business ...... 283 12. Office Automation and Differentially Affected Groups: Women and Minorities...... 297 Appendix A—The Technology of Office Automation...... 307 Appendix B–OTA Case Studies ..., ...... , ...... 330 ,

Chapter 1 The Outlook for Office Automation Technology, 1985-2000 Contents

Introduction ...... 3 Organization of Report ...... 4 Looking to the Future ...... 5 What is Office Automation? ...... 6 Understanding the Impacts of Office Automation ...... 8 The Technology of Office Automation–Present and Future ...... 11 Distributed Information-Handling and Networking ...... 11 Proliferating Options ...... 1 ...... 12 The Capture of Data...... 13 Communication Between Organizations ...... 13 How Rapidly Will Office Automation Occur? ...... 14 The Possible Consequences of Office Automation, 1985-2000 ...... 15 Economic and Employment Effects ...... 15 Training and Education ...... 17 Organizations and Jobs ...... 18 Office Workers and Their Workplace ...... 19 Data Security and Confidentiality ...... 20 Home-Based Office Work ...... 21 Off-Shore Performance of Office Work...... 21 Federal Government Office Automation ...... 22 State and Local Government Offices ...... 23 Small Business and Office Automation ...... 23 Working Women and Minorities ...... 23 Policy Issues for Congress ...... 24 Further Discussion: Policy Issues and Questions ...... 24 Employment...... 24 Conversion to Part-Time, Temporary, and Contractor Status ...... 26 Training ...... $ ...... 26 Labor/Management ...... 26 Health and Safety ...... 26 Data Security and Confidentiality ...... 27 Home-Based Clerical Work ...... 27 Off-Shore Office Work By or For U.S. Firms ...... 28 Federal Procurement Policy ...... 28 Federal Personnel Policy ...... 28 State and Local Governments ...... 28 Small Businesses...... 28 Women and Minorities ...... ~...... 29 Figures Figure No. Page l-1. Changing Structure of the Work Force ...... 3 l-2. History of Technology Used in the Office ...... 9 l-3. User Institution Model of Technological Change ...... 10 Chapter The Outlook for Office Automation Technology, 1985-2000

INTRODUCTION

America has become an information society. These were some of the questions that led Our economy is driven as surely by the inces- the Senate Committee on Labor and Human sant demand for information as it is by the Resources and the House Committee on Edu- continuing necessity of converting raw mate- cation and Labor to ask the Office of Technol- rials into finished products. ogy Assessment (OTA) to conduct a study of The majority of American workers are now the growing use of microelectronic information and communication technologies in office work. white-collar workers, and about 45 percent of all American workers work in offices. (See fig- With less than 3 percent of the labor force ure l-l. ) Office work is rapidly being “auto- now employed in agriculture and the propor- mated, ” or computerized. What does this mean tion of blue-collar workers steadily declining, for the productivity of office workers and the the automation of white-collar work inevita- number of office jobs that will be available in bly raises concerns about the number of jobs the future? What skills will white-collar work- that will be available for the still growing la- ers need? What job ladders will be open to bor force in the long-range future. This report them? Will the quality of their working life deals with those white-collar workers who pri- be better, or not as good? What new opportu- marily work in offices, although information nities and new problems can we expect, as a technology is also affecting others, for exam- result of sweeping technological change in ple, department store clerks and supermarket America’s offices? cashiers.

3 4 Automation of America’s Offices

But American industry is now participat- employment will depend in large part on the ing in a global economy. Competition for both interactions between them. world markets and domestic markets is a powerful incentive for seeking higher productivity. Just as the successive waves of mechaniza- Microelectronic technology has enormous po- tion of farm and factory work have changed tential for increasing productivity in white- U.S. society and economy, so will the automa- collar work, which is a large and growing part tion of white-collar work. Social and economic of every industry sector. transitions in the past have raised policy issues that had to be addressed, and in many The office is the primary workplace for many cases are still being addressed, by Congress. industries, such as banking, insurance, and real The new wave of automation will also create estate, but the office is also a vital element both opportunities and problems that demand of every industry from manufacturing to farm- the attention of Congress. ing. An OTA assessment of factory automation, for example, found that”. . . the salaried Technological change is also related to ques- or white-collar work force will constitute a tions already on our political agenda, such as larger proportion of manufacturing employ- comparable worth and pay equity, interna- ment “1 in the future. Increased productivity tional trade, and health and safety in the work- in office work thus would contribute to pro- place. The effects will eventually be felt by ductivity and growth in all sectors of the everyone—producers and consumers; manag- economy. ers, professionals, and clerical workers; large and small organizations; the private sector and The demand for information will continue the public sector. The role that information to grow. With computerization, the unit cost and communications technologies will play in of collecting, processing, distributing, and offices in the future, and the opportunities and using information will decline. More kinds of problems they present, thus concern all Ameri- information will be gathered and used for new cans and all of their representatives in Congress. purposes, and many new information services and products will be created. Demand for in- This report puts before its readers a broad formation and increased productivity are two range of likely consequences of office automa- major factors in the employment equation; the tion, and calls attention to large areas of un- consequences of office automation for office certainty. It points to some public policy issues that are emerging or may arise. Many ‘U.S. Congress, Office of Technology Assessment, Compute- other questions must and can be resolved only rized Manufacturing Automation: Employment, Education, and the Workplace, OTA-C IT-235 (Washington, DC: U.S. Gov- by the informed choices and cooperative ef- ernment Printing Office, April 1984). forts of individuals and organizations.

ORGANIZATION OF REPORT

After a brief look at the context of office ceptual framework or model that guided the automation from the perspective of history, assessment. It then summarizes the findings this chapter highlights some expectations of the assessment, identifying policy issues about the technologies and their development that are likely to concern Congress over the over the next 15 years. It introduces a con- next decade. Ch. l—The Outlook for Office Automation Technology, 1985-2000 ● 5

Many of these issues are just coming to pub- Chapter 11 is a brief survey of the limited lic attention and have not yet been widely dis- information currently known about office auto- cussed; specific proposals for dealing with mation and small businesses, an important sec- them have not been put forward. A few of the tor of the economy that is just beginning to issues, however, are already before Congress automate its offices. or are apt to be the subject of congressional Chapter 12 considers the implications of consideration in the near future. office automation for two groups that are likely Chapters 2 through 6 discuss the possible to be particularly strongly affected: working effects of office automation in more detail. women and minority white-collar workers. They deal with potential effects on employ- Appendix A describes office automation tech- ment levels; the kind of training and educa- nology as it is now and as it is likely to de- tion needed for office work; changes in work velop between 1985 and 2000. content, jobs, occupations, and organizations; the quality of work life, the office environment Appendix B summarizes case studies of the and labor management relations; and the secu- automation of several offices to provide some rity and confidentiality of information. examples of the changes that occur when offices are automated. In particular these ex- Chapters 7 and 8 consider two alternatives amples illustrate the variety of offices affected to conventional offices, made feasible and eco- and the difficult transition stage that occurs nomically attractive by office automation. The as offices automate their work. first of these is home-based work, especially the use of the worker’s home as the primary The summary discussion in this first chap- or sole site for clerical work. The second is off- ter is keyed at appropriate points to later chap- shore performance of data-entry operations, ters, where the reader will find more lengthy in which work is sent off to be done in coun- discussions. tries with lower paid workers. Chapters 9 and 10 look at office automation in the public sector— Federal agencies and State and local governments.

LOOKING TO THE FUTURE

During the present transitional stage of of- effects and transitional problems than with fice automation, there are many problems that long-range structural changes. These struc- are real but do not require congressional ac- tural changes are likely to become clearly vis- tion. Some of the fears that people have in an- ible only after office automation has been ticipating technological change later prove widely adopted and organizations learn to use groundless. Many problems are resolved by its full capabilities. ingenuity, trial and error, and negotiation be- Information and communication technology tween groups that have competing interests is itself rapidly evolving and expanding its ca- but a shared motivation to benefit from tech- pabilities. The range of technological choices nology. Structural changes in the economy, that an organization has for accomplishing any on the other hand, can create lasting inequi- given information-related objective is wide. ties and conflicts. They can also open up new The number of manufacturers and vendors of opportunities to resolve old issues and realize office automation equipment is large, and the new social benefits. competition between them is strong. This sug- OTA chose a 15-year perspective because gests that the technology of office automation Congress will be concerned less with ephemeral will be strongly influenced over the next dec- 6 ● Automation of America’s Offices —

— . . Photo credit L/brary of Congress Photo credit. Michae/ J SnJIfh

The evolution of the office environment is shown in these two photos from 1897 and 1980. Perhaps in the future there will be a truly paperless office. ade or more, by the needs and wishes of the now projected, rather than later, since this has users. happened repeatedly in the last few years. Also uncertain is the speed with which of- The as-yet-undetermined characteristics of fices will adopt new technologies. This will be future office automation technology will strongly influenced by general economic conditions, but influence the social consequences of the auto- in the last decade office automation has been mation of white-collar work. But changes in less sensitive to these factors than many ex- the U.S. economy and society are not, or need pected. Because it can be accomplished incre- not be, entirely technologically determined. mentally and with relatively small investments, They depend in part on choices and decisions adoption of office automation may be much made by individuals and organizations, and wider, more general, and more rapid than has they also can be guided by public policy. often been the case with new technologies. This makes transitional problems more visible and The conclusions of this assessment are there structural problems more important-e. g., dis- fore conditioned by unavoidable uncertainties placed workers will have fewer options for ad- about the choices that users will make, about justment if their occupations are affected in economic growth, and about future public pol- most regions and most industries in a rela- icies. Major directions in the evolution of the tively brief period. It also indicates that deci- technology can be discerned, but when these sionmakers should now begin to attentively technical improvements will occur is more un- monitor the changes that are occurring, in or- certain. It is most prudent to assume that some der to be prepared to deal with problems that technical breakthroughs may come sooner than may arise.

WHAT IS OFFICE AUTOMATION?

Almost any place where information han- clerical workers. For the purposes of this re- dling is the main activity is called an office, port, the office is wherever “office work” is whether it is one person at a desk or a com- done, and “office work” is the processing and plex hierarchy of executives, professionals, and use of information for the purpose of track- Ch. l—The Outlook for Office Automation Technology, 1985-2000 7 ing, monitoring, recording, directing, and sup- munication devices and systems that can link porting complex human activities.’ One of the them together. striking consequences of information and com- The first offices may have been in the homes munication technologies is that together they of Babylonian merchants or Phoenician traders, make much “office work” independent of the or perhaps they were construction project place where it has usually been performed; that offices in the palaces of Egyptian Pharaohs. is, they allow it to be done in the home, in air- Almost certainly something like an office came planes and trains, and in other countries. into existence as soon as records could be kept For the purposes of this report, the term “of- of the exchange of goods, on clay tablets, fice automation’ is used broadly to mean the chisled stones, papyrus, and quipus.3 Office application of microelectronic information work is inseparable from commerce because technology and communication technology to it is concerned with gathering, keeping, and office work. It includes large “mainframe” using information about human activities, and computers, smaller minicomputers, personal particularly those activities that have to do computers or microcomputers, stand-alone with the production and exchange of goods word processors, and the many diverse com- and services. If office work began in the homes of mer- ‘By extension, people also speak of places where other professional work is done as an office–e. g., a dentist’s office. chants and traders, it has nevertheless for most In this report we attempt no rigorous definition of what is or of history been done in central locations close is not office work, but use a commonsense approach. We have to the production of goods and services.4 The generally excluded from consideration such peripheral or specialized places of white-collar work as the dentist’s office, the office plays the same role for an organization scientific laboratory, and the draftsman’s office. that the brain plays in a living organism. It receives information flowing in from all parts of the organization (or organism) and from the external environment, processes that information and sends back responses, instructions, and commands through an extended nervous system—established channels of communication. At the dawn of written history, clerks and scribes were the first office workers. Informa- tion handling work has always carried with it a degree of respect or status (even when many scribes were slaves) because it requires skills and education that, through most of history, few people had. The tools used in this work were for thousands of years very simple, basically writing implements and something to write on, and some means of storing the records written or received. As the scale of human activities increased, the information about them became more voluminous and more diversified. The tools became slightly more sophisticated (a

3Quipus were knotted cords used by the Peruvian Indians (who did not develop writing) to keep records. ‘One of the effects of new communication and information technology may be to allow office work to again be done in homes; see ch. 7, “Home-Based Automated Office Work. ” bookkeeping ledger rather than a stone tablet About 85 percent of office operating costs are or roll of papyrus) and office workers became labor costs. more numerous and more specialized. When Now capitalization is occurring rapidly, in the clocks were invented, the work became more form of information and communication tech- subject to measurement, pacing, and manage- nologies that are transforming the nature of ment control. When electric communications white-collar work. were invented, it became less sensitive to proximity but more sensitive to time.5 But not un- Many other forces have affected office work til the advent of the telephone, the typewriter, in recent decades. The scale, geographical and the adding machine, near the end of the scope, and concentration of economic enter- 19th century, was a significant part of the work prise, and therefore of offices, has increased. automated. (See figure 1-2.) Some sectors of industry and commerce have expanded and some have shrunk in impor- The mechanical stage of office automation tance. The growing pervasiveness of science was followed by the electromechanical stage, and technology as components of the economy with electric typewriters and calculating ma- has both increased the demand for data and chines. The present age of computers began changed the nature of the information han- a little more than 15 years ago, and this assess- dled in offices. There has been a strong tend- ment looks forward for another 15 years— ency to professionalize and credentialize many together, only about one generation in human occupations. terms, and less than the working lifetime of a white-collar worker. The office work force has also changed. The average educational attainment of office work- Through the mechanical and electromechan- ers has increased, yet the educational gap be- ical eras of office automation, whitecollar work tween office workers and the general popula- continued to be labor intensive. Capital invest- tion has narrowed or disappeared. Women, ment in office work has always been low com- once a very small part of the office work force, pared to capitalization in other economic sec- now make up the larger part of it. Changes tors such as manufacturing and agriculture. in values, lifestyles-and some claim, the work ‘Note that until the 1840s, and the invention of the tele- ethic-have affected office workers along with graph, it might take days or weeks to communicate with another all others in society. office in a different part of the country. Until the transatlantic cable of 1866, it took at least 4 weeks for a merchant to send These trends are all important. But tech- a message to his field agent in Europe and get a response, and nology or the tools people use, have a primary it might take months to exchange messages with the ship carrying his goods, since he could not know when and where it affect on their work, how it is done, and how would make port. it is rewarded by society.

UNDERSTANDING THE IMPACTS OF OFFICE AUTOMATION

In carrying out this assessment, OTA used of effects: substitution, adaptation, and trans- a simple ‘conceptual model as an aid in look- formation. ing for the possible effects.8 (See figure 1-3.) The new technology usually replaces an older It suggests that when organizations adopt new technology or human labor, or both. There are technology, there are likely to be three kinds direct substitution effects, both at the task ‘This model was developed by J.F. Coates and V.T. Coates; level and at the organizational level. As word for an example of other as~essrnents in which it has been used, processors and computers replace the typewriter, see V.T. Coates, et al., A Retrospective Technology Assess- rnent: Submarine Telegraphy (San Francisco: San Francisco bookkeeping ledgers, and payroll systems, and Press, 1980); and V.T. Coates, “The Potential Impacts of Ro- other communication systems augment tele- botics, ” The Futurist, February 1982. phones, there are effects on productivity, size . .

Ch. l—The Outtook for Office Automation Technology, 1985-2000 ● 9 — —.

Figure 1-2.— History of Technology Used in the Office

I (Third phase off!ce automation) 1 Local area networks, integratad systems. Non-impact printers. (Second phase otflce automation) Software packages for microcomputers. Microcomputers ● Optical scannlng and recognittcm equipment ●

Video display terminals for data/text processing ● (First phase offtce automation) [ 1 Facsimiie transmission ● Etectronic(solid state) calculating machines.

Microchip computera ● Magnetic tape "seletric” typawritars. Magnetic tape (replacing punched cards). Magrtetic ink character reoognit@rr (cfteck proof lngfsorfin@ ●

Electronic digitat computers (trsdstor$}. Efeotronic digital computers (vacuum tubes).

. Data processing - telewriters I Electrification Era (1920-1960) 1 c Data processing - computypers ● Data processing - paper tape or card: ● Xerographic duplication ● Mechanical listing printing calculators, 4 functions . Punched card syatems (e.g., PayrOfl) ● Oict@ting/stenographic machines with plastic belts ● Common language concept for business machines ● Bank check sorting/proofing machines Dialing Telephones ● ✥●❅❃▼❒ * Machine accounting systems(central records, control, payroll) Multilifh duplicating (offset printinfj Addressograph/multigraph with automatic f- ● Adding/subtracting calculating machines [Ditto machines (gelatin duplcating)

● Power statistical accounting machine ● Bookkeeping and billing machines (combinations of typewriting and computing machlnesj ● Loose-leaf leadger Sheet$ ● Muttigrapff (Mechanical Era 1800-1920) I 1 ● Two-color typewriter rfbbon . Addressograph ● Adding machine, Ilstlng and non-listing . Hotlerith machtnes {card punch, tabulating and sorting machines) . Cash qister ● ComPtometar Oakutattrrg maohirm . M\mtqr@f maoftina @wmil Wttln$ duWMiW * Pnaumatie tufnis ● Qlotating and $tanOgmpW faaohifraa ● Wa@One ● Catbon paper * Typawritar # . stia~ cwpming machine ● Fountain pen 1 I I 1 I I I t I I I 1 I 1 I I I I I 1810 1820 1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 SOURCE Off Ice of Technology Assessment 10 . Automation Of America’s Offices

Figure 1-3.— User Institution Model of Technological Change

‘Innovative Institution technology I adopts technology to carry out existing Step I functions more efficiently technology may be modified to suit needs of users better J

lnstitution

changes internally to Step II take better advantage of new efficiencies \ J

Other institutions I may be created, or develops new functions old ones changed, and activities made to utilize new possibly by additional Step Ill technology capabilities of the technology

Competition between institutions I institution Step IV

SOURCE Joseph T Coates, “Aspects of Innovation” Public Policy Issues in Telecommunications Development, ” Te/ecornmunications Po/icy, vol. 1, No. 3, June 1977. of work force, job content, the skill required The institution deliberately or “unconscious- of workers, etc. These effects are perceived as ly, ” by plan or by trial and error, begins to “good” or “bad” depending on one’s perspec- modify itself to suit new ways of doing things. tive and interests. This is the adaptation stage. The adaptations may include for example formal reorganiza- The institutional structures, culture, oper- tions, shifts in power relationships, adjust- ating procedures, and management expecta- ments in responsibilities, or changes in the way tions at this point still reflect the old work- workers are recruited and compensated. flow and work process. Tension is created because the characteristics of the new tech- Two kinds of problems may arise in this nology are different, and the requirements for phase. If significant changes are made quickly effectively using it are different. Until this ten- and by explicit decisions, they may evoke re- sion is resolved, the full benefits of the substi- sistance and resentment from those who lose tution are not realized and productivity may power or who are uncomfortable with any even fall. Many organizations are still at this change in the status quo, especially when peo- stage in office automation. ple do not understand the reasoning behind Ch. l—The Outlook for Office Automation Technology, 1985-2000 . 11 the changes or have not participated in the economy. The financial services industry,7 for decisions. On the other hand, if adaptations example, used the new technologies to avoid are not planned, there may be a long period legal boundaries between banks, insurance of frustration and inefficiency before common companies, brokers, and other elements of the sense indicates just what changes are nec- industry. essary. Some organizations fail to adopt new tech- The third kind of effects, transformations, nology, even when it becomes the norm among come about because new technologies are likely competitors. They risk eventual obsolescence to have entirely new capabilities not offered and failure. For example, mail order businesses by the older technologies. The organization that have not automated customer services may develop new activities, products, or serv- are in serious trouble. The feedback loop in ices, using these capabilities. For example, the model is important; further development computers offer not only a more efficient way of the technology is shaped by the market and to do bookkeeping, but also the capability for by the demands of users. New businesses may continuous inventory control, not possible be- be spawned that specialize in innovative use fore. They make it possible to target mailings of the technology, or specialize in helping other to special customers, and track the results. firms use it. Some organizations began, as soon as they computerized their own data processing, to offer these services to others. This round of ef- ‘See U.S. Congress, Office of Technology Assessment, Ef- fects of Information Technology on Financial Services Systems, fects may bring about the restructuring of an OTA-CIT-202 (Washington, DC: U.S. Government Printing Of- industry or of the mix of industries within the fice, September 1984).

THE TECHNOLOGY OF OFFICE AUTOMATION– PRESENT AND FUTURE

The dominant trends in office automation, Distributed Information-Handling from 1985 to 2000, are likely to be: and Networking ● a continuing strong movement toward In about three decades, there have been three microcomputers and toward distributed overlapping phases of computer-based office data access and data handling, usually su- automation: centralized computing, decentral- perimposed on rather than superseding 8 ized or end-user computing, and networking. centralized automatic data processing; Before the last decade, large organizations ● more powerful, easier to use, software; were preoccupied with computerizing their ● a strong trend toward linking and net- mass data handling and typing, and were de- working of microcomputers, minicomput- veloping large systems and a corps of com- ers, mainframes, and peripheral and sup- puter specialists to run them. This gave rise porting systems; to the familiar “EDP” (electronic data proc- ● increasing choice among technological op- essing) or “ADP” (automated data process- tions for accomplishing information han- ing) center, staffed by computer specialists, dling objectives; primarily for batch processing of data and the ● more and more capture of data at the point development of large corporate databases. of origin, decreasing the need for repeated keyboarding and centralized data entry; and ● growing capability for communication, be ‘The reader who wants a more detailed description of office tween devices, between organizations, and automation technology (but one still intended for the lay reader) and a discussion of the outlook for its development over the between locations. next 15 years, may go directly to app. A. 72 . Automation of America’s offices —

In industries that deliver customer services, Such linked systems can also connect com- such as insurance, this phase is sometimes puters with printers and copiers, and with out- called “back office automation, ” since it chiefly side communications systems (telex, telephone affected the part of the office characterized lines, cables, etc.) to create “integrated office by large numbers of clerical workers doing the systems. ” Networking is not easily imple- kind of paper processing seldom seen by the mented. Because of the wide diversity in hard- consumer. They entered data into the com- ware, software, and interface mechanisms pro puter using “dumb terminals’ ’-i.e., using tided by vendors, it is often difficult to connect keyboards that fed data to a large central com- devices and systems so that they can “talk puter that did the processing. Many organi- to each other” or work together as an effec- zations established central word processing tive system. In spite of these problems, in the departments or pools, in which specialized cler- last 2 years many organizations have devel- ical workers took over the “typing” (or at least oped “networks” or linked systems, and the the keyboarding of all lengthy documents) for trend is rapidly gaining momentum. a department or for the entire organization. Differences between centralized EDP com- The second phase of computerization began puting systems and end-user computing will in most organizations about 1978 to 1980, with gradually blur. The first and second phases the introduction of small stand-alone word of office automation, considered separately, processors and microcomputers or personal often appear quite different, but it will become computers (PCs), used by people who are not less important whether a worker is using a computer specialists. Software packages al- dumb terminal, or a PC that is networked to low people who know little about computers other computers, because they will be able to or the arcane skills of programming to draw access the same databases and perform roughly on databases or add to them, to manipulate the same functions. text and quantitative data, to generate tables and graphic displays, and to exchange information with other computer users, without the Proliferating Options direct mediation of computer specialists. PCs Broad choices among vendors, devices, sys- are increasingly used by managers and profes- tems, software packages, connecting devices, sionals as well as by support staff. Many ex- communications technologies, and service pro ecutives who would not ever have typed now viders now characterize office automation. This use word processing to draft letters, memos, range of choice, and the rapid evolution of the or reports, or generate reports using spread- technology, creates problems for organizations sheet software. that want to plan their automation rationally This has come to be known by the awkward over a long period. However, it also allows term “end-user computing. ” Today, the use of offices to automate their work a few tasks at computers by nonspecialists-end-user comput- a time, if they so choose. ing—is a highly visible trend. End-user com- Microelectronic office equipment is a highly puting is not replacing central computers, but competitive industry, and this has contributed is often added to or superimposed over a cen- to both declining prices and expanding capa- tralized EDP process within an organization. bilities. The computer industry has become The third phase is already beginning-the a consumer industry. Large volume buyers linking together of microcomputers, and the (e.g., the Federal Government) have a less dom- linking of microcomputers to mainframes or inant influence over the direction of techno- minicomputers so that they can act (compute) logical development than the cumulative choices either independently or as an extension of the made by the great number of middle and small larger central processing unit. For the next dec- size organizations. Even within large organi- ade, networking will be a major trend in office zations, the purchase of microcomputers and automation. word processors has often been relatively un- Ch. 1—The Outlook for office Automation Technology, 1985-2000 ● 13 controlled and the authority to choose between rekey boarded even if it came from one com- competitive brands has often been decentral- puter and goes into another computer. ized and dispersed. Thus, considerations such But much of this work is being eliminated, as the overworked phrase “user friendliness’ have become important in the design of office or is likely to be eliminated in the future. In- creasingly, computers are able to communi- automation. cate directly with each other, through modems A striking feature of the market so far has or other technological means. A second way been that only a few older office technologies of eliminating data-entry work is to allow (or have been eliminated completely.g Many have require) a consumer or client to enter informa- preserved their special niche, often by incor- tion directly into the organization’s computer. porating microelectronic components–e.g., This happens, for example, when a bank’s cus- the typewriter and microfiche. Technologies tomer uses an automated teller machine (ATM) that were once separate are converging-type- to deposit or withdraw funds or shift funds writers become like word processors that in between accounts, or when he/she uses a home turn become almost indistinguishable from computer to instruct the bank to pay his/her personal computers. Telephones incorporate monthly utility bill. A third way of eliminat- small computers, and computers serve as coming data-entry work is to have the computer munication devices. No one piece of equipment directly read typed or printed information with does everything but nearly all do more than optical scanning technology; or to enable the one thing. As a result, users can put together computer to “hear” and store information con- devices and components to meet specific needs, veyed by voice (i.e., speech recognition). Opti- and there are few obvious limits to what in- cal scanning devices are improving rapidly and formation-handling tasks and functions can increasingly in use; speech recognition tech- be automated in the long run. Few critical technology is in an earlier stage of development, nical barriers exist to future higher process- but is already being used in a limited way. ing speeds, larger memories, much improved A critical determinant of the results of office input and output technologies, and full com- automation over the next 15 years is the out- munication between systems and devices with- look for computer input technology. Data en- out regard to distance. try, including word processing, is probably the largest single computer-related category of The Capture of Data clerical employment today. Organizations are A large proportion of the work in today’s seeking and finding ways to avoid the neces- offices involves putting data into computers. sity of keyboarding data for a second, third, Whether data is generated within an organiza- or fourth time. Beyond that is the possibility tion or drawn from outside the organization, of never having to keyboard it. If this hap- it usually must be keyboarded into computers pens, then both the number of jobs dedicated for further processing. This is especially true to data entry, and the costs of data handling for data that is collected on a disaggregated will decline dramatically-at least, for a given basis–orders placed or received, ticket stubs, volume of data. invoices, checks, transport forms, vouchers, customer complaints, etc. When organizations Communication Between Organizations exchange information either directly or through a client (e.g., payments and receipts, or a pa- As already noted, one way to avoid second- tient sending hospital bills to a health insur- ary entry of data is for interacting organiza- ance provider) the information often must be tions to exchange data directly from computer to computer. For example, a hospital computer ‘Reprography has just about eliminated the multilith, may send bills directly to the health insurer’s mimeograph machine, and carbon paper—but not entirely. As yet, electric typewriters have not completely eliminated me- computer, which instructs the bank’s com- chanical typewriters. puter to transfer funds; the bank’s computer 74 ● Automation of America’s Offices —

ogy; the structure of the adopting industry or industries, and their competitive environment; and a variety of social and behavioral factors that can be collectively called organizational culture.10 An examination of these factors in relation to office automation points to a relatively broad and speedy adoption. The role of offices and office work is tending to increase in every sector (i.e., there is more “paper work’ or information-handling in the production of all goods and services), and automation can be adopted by and adapted for offices in every industry sector. Many kinds of office activities are similar in all organizations-generating text, keeping records, circulating memos, preparing payrolls, filing, etc. Because many kinds Photo credit: Bell Labs of office automation can be implemented in- One characteristic of office automation is the integration crementally, and at relatively low cost, it can of computing and communication technologies be adopted by small as well as large offices.

then notifies the hospital’s and the insurer’s There are a variety of reasons for automat- computer that the payment has been accom- ing information-handling, from reduction of plished. As another example, the computer of labor costs, to improving the quality or vari- a manufacturer may receive an order from the ety of services, to reaching a larger market computer of a customer, then order and coin a given time. If an organization adopts auto- ordinate the shipment, with the payment han- mation for the purpose of providing new serv- dled and recorded by direct communication ices or products, or reaching a new market, between the computers of the buyer, seller, its competitors may feel forced to do likewise. and bank. A few pairs of organizations are said The effects of technological change often de- to have such linkages operating at present; pend on how rapidly that change occurs. Prob- more are likely to do so in the future. lems may solve themselves if there is much time to adjust. On the other hand, opportuni- How Rapidly Will Office ties not quickly grasped may be forever lost, Automation Occur? or problems left to drag on may fester. Later chapters of this report will point to organiza- Office automation may proceed more rap- tional and behavioral problems that could slow idly and penetrate economic activities more the adoption of office automation. At present thoroughly than have other waves of automa- however, it appears that these are largely tran- tion. The pace of technological change has, in sition problems for which many solutions are the past, repeatedly confounded expectations; being developed. sometimes it has been slower than expected, sometimes more rapid. Much depends on the resources required to adopt new technology, the time required to recover the necessary investment, and the economic conditions that “’The analysis here and in ch. 2 draws on an OTA contrac- prevail. Particular factors of importance are tor report, J.D. Roessner, “Market Penetration of Office Auto- mation Equipment, Trends and Forecasts, ” November 1984. the costs of capital and labor; the availability This report is part of an OTA contractor report, A.L. Porter, of people to use and manage the new technol- et al., “Office Automation Outlook: 1985 -2000,” February 1985. Ch. l—The Outlook for Office Automation Technology, 1985-2000 ● 15

THE POSSIBLE CONSEQUENCES OF OFFICE AUTOMATION, 1985-2000

Some emerging and potential policy issues magnitude of the reduction will depend in part identified by OTA are of interest because con- on the technological trends noted above and tending parties have already voiced their con- in part on management strategies. cerns, and in some cases, related proposals are The reduction in labor will be most signifi- before Congress. Most of the policy issues, cant in the clerical/support occupations, espe- however, are of more long-range concern or cially those that predominantly involve data are contingent on conditions anticipated but entry. Fewer lower level workers would in it- still in the future. self indicate a need for fewer first line super- In relation to most of the policy issues, some visors and managers. But the span of man- attempt has been made to indicate potential agement control can also be broadened by congressional responses. This is done to indi- automation of the work process. Thus, fewer cate the range of conceivable policy interven- managers may be needed (again, for a given tions. OTA has not fully evaluated all of these volume of information-handling). Some of the policy options in terms of their own possible tasks of lower level managers can be auto- effects, or the pros and cons of adopting them, mated, or be taken over by clerical workers either in this chapter or in the course of the who are lower paid, so this tier of jobs is again assessment. likely to shrink. Some of the tasks of paraprofessional or technical workers may follow Economic and Employment Effects the same route. Professional occupations are less vulnerable, but not immune to the substi- Increased Productivity tution and adaptation effects of automation. By the mid-1990s nearly every office will Whether or not organizations have as their have at least one computer, just as nearly all primary motivation for adopting office auto- offices now have telephones. There will prob- mation a reduction (or constraint on growth) ably be a terminal of some kind for at least in the work force, relatively few can yet dem- every two or three office workers. Since many onstrate that they have achieved that result. organizations will by then have adapted their Many have hired more workers. OTA case work process and work environment to the new studies, internal corporate studies, interviews technology-although restructuring and change with business executives, and reports in trade will surely continue—many solutions to cur- literature have repeatedly shown such short- rent transitional problems should be available. term inefficiencies resulting when a new tech- Office productivity should increase signifi- nology is introduced into a workplace, process, cantly. working group, and organizational structure Productivity in white-collar work is difficult not yet designed to use it to best advantage. to define and measure, as is discussed in chap- Yet most evidence suggests that in a given ter 2. But however productivity is perceived task, time and labor saving from automation by a specific office or industry, significant in- is significant. Some tasks or steps are elimi- creases as a result of office automation will nated entirely. affect employment levels, at least for some of- Declining costs and the proliferation of new fice occupations. uses and needs for information argue for a strong and continuing growth in the volume Employment of information-handling and thus for a steady There will certainly be a significant reduc- increase in the office workload. The growth tion in the hours of labor associated with a in demand for information and the reduction given volume of information-handling. The in labor associated with information-handling 16 ● Automation of America’s offices are two competing trends—both associated watchful concern by Congress, and to merit with information and communication tech- efforts to improve the monitoring of employ- nologies —that will affect the level of future ment trends so that corrective or compensat- office employment. Which force outweighs the ing actions can be taken when and if they are other is surely a judgment call; it may ulti- needed. Recent employment forecasts should mately depend on broad economic conditions, not lull policymakers into complacency. This other unforeseen technological developments, is an area fraught with uncertainty. and choices and decisions made in industry, If the number of office jobs continues to government, and society at large. grow, no congressional action will be called Because in the past, employment growth as for; if that growth falters or reverses, there a whole has continued through periods of tech- will immediately be strong demands for Federal nological change, many economists believe intervention. However, early signs of trouble that the number of office jobs will continue may be missed. At present, the Federal Gov- to grow strongly in spite of office automation. ernment is poorly equipped to detect or under- Others doubt this because of the high poten- stand early signals of problems arising from tial efficiency of microelectronic technology structural changes in the economy related to in office work (especially clerical work), which technology. has always been very labor intensive, espe- Labor force and employment data collection cially since the economy is generally not ex- does not support analysis of emerging trends pected to grow as rapidly in the future as it because it is necessarily collected, aggregated has in some past decades. For example, a re- or disaggregated, and analyzed in categories cent scholarly article suggests reasons for the that reflect the occupations and jobs framed “common misconception” that future econom- around old technologies or occupational/dis- ic growth spurred by high technology will nec- ciplinary tools. Census data is necessarily old essarily provide a net increase in jobs; the (in terms of today’s rapid change) by the time authors said, especially speaking of computers it is available for analysis. Econometric models that: are insensitive to realistic expectations about ,,. the impact of (new) technologies is likely new technology and the changing substituta- to be more widespread than that of past tech- bility of capital for labor. There is a great need nologies because their cost has declined so for improved databases, for greater attention sharply relative to their capability and rela- to advancing the state of the art in both tech- tive to the costs of labor . . . (and) the economic nological and employment forecasting, and for context has changed considerably from the building and institutionalizing a capability past. ” that combines and integrates those two dis- The present capability for economic and em- ciplines. No agency now has a strong capabil- ployment forecasting is not good enough to ity of this kind, nor the resources and specific resolve this very large uncertainty. mandate to develop such a capability; moreover, there is very little Federal funding avail- Thus, it is possible that there will be continu- able for research into crucial areas of eco- ing strong demand for additional office work- nomics, social science, and organizational ers. The most likely outcome, however, is slowing behavior related to this area. ’2 growth in the number of office jobs and even eventually an absolute reduction in the number The critical question for Congress at present of jobs in offices. While the latter outcome is is not one of immediate interventions, but how by no means certain, there is sufficient evi- to improve the capability of the Federal Gov- dence pointing in this direction to justify ernment to understand, and thus be prepared — “Russell W. Rumberger and Henry M. Levin, ‘iForecasting the Impact of New Technologies on the Future Job Market, ” Technology Forecasting and Social Change 27, 1985, pp. “Hearings of the Science Policy Task Force of the House 399-419. Committee on Science and Technology, Sept. 17-19, 1985. Ch. I—The Outlook for Office Automation Technology, 1985-2000 ● 17 to respond to, technological and structural many people the opportunity to create spe- changes that are occurring in the United States cial roles for themselves and has led to new and other advanced industrial nations. job ladders and career paths. Men and women with the capability, imagination, daring, and Conversion of Employee Status opportunity to rise to this challenge are mov- Office automation may enable employers to ing into the upper levels of organizational hier- convert more employees into part-time and archies. Whether or not this career path will temporary workers or independent contrac- create anew pool of potential senior managers tors. This allows offices to adjust their labor or chief executive officers, only time will tell. costs to a fluctuating workload, to reduce some Some of the likely effects on employment overhead costs, and to eliminate or external- are not inevitable results of office automation, ize some secondary labor costs (benefits pack- but result from management/institutional ages). While some workers prefer and seek choices about the combination of technologies opportunities for part-time employment, the adopted, the way they are implemented, and number of involuntary part-time or temporary the way the work is restructured. But to the workers has been slowly and steadily increas- extent that the technology may encourage ing. Significant growth in the use of part-time business decisions to be made only on the ba- and temporary work forces could ultimately sis of narrowly framed, near-term cost con- reduce the number of full-time jobs for those siderations, this could have a negative effect who need or desire them. It may also shift on both long-term productivity and future op- responsibility for benefits and protective mech- portunities for productive and rewarding em- anisms such as health insurance, unemploy- ployment for many Americans. ment and disability insurance, and retirement income to the worker, costs that may ultimately have to be assumed in part by the Training and Education taxpayer. A major factor in achieving the full produc- Job Opportunities tivity benefits of office automation is the availability of workers skilled in its use. From the In some occupations and industries, those standpoint of organizations and their man- tasks that have historically been at the cross- agers, an adequate supply of trained workers over point between clerical jobs and lower level to meet future needs is critical. From the stand- management or professional jobs have been point of office workers, access to training and automated. In other occupations or industries, the ability to master new skills is critical. office automation has been used to narrow and specialize clerical tasks or to deprofessional- In the short term, the training need not be ize tasks. In this way, some important chan- lengthy or excessively expensive. The trend nels of career mobility (job ladders) have been in both hardware and software is toward great- truncated. These effects are of special impor- er simplicity for the user, and more opportu- tance to women and minorities. In some in- nisty for self-teaching based on training proce- dustries or organizations those channels have dures built into the technology. However, only been opened to women and minorities because office automation often brings about within the last decade, and are looked to as a drastic redesign and resequencing of tasks, a primary opportunity for escaping from poorly both initial and continuing training is essential. paid occupations and segregated “women’s Training provided by vendors and by some work. employers is highly system- and task-specific. Office automation also creates some new cat- For the user, this makes training easier, but egories of jobs, or new specialties within ex- limits its future usefulness. Economic pres- isting occupations. Proficiency in solving prob sures, however, motivate some employers to lems related to office automation has given provide no more than minimum training. Many 78 . Automation of America’s offices

organizations, in deciding to automate, have some ways better able to respond quickly to underestimated the continuing training and market changes-i. e., to be able to invest in support that is necessary, and these costs can up-to-date technology and retraining for in- dwarf the original investment. Some employ- structors. Again, the costs to workers of com- ers also see it as in their interest to make train- mercial courses, in terms of both money and ing as narrow, specific, and brief as possible. time, mean that the most disadvantaged pop- In that way they have minimum investment ulations are put at a further disadvantage. in workers who could then be lured away, and replacement workers can be trained rapidly. Organizations and Jobs But this practice can also trap workers in dead-end jobs and limit their ability to move There is much controversy at present around up to jobs of wider scope and higher skill re- the question of whether office automation en- quirements. hances or “de-skills” office work. De-skilling means the standardization and routinization Many organizations are providing their work- of tasks, in such away that human knowledge, ers with ample training both in their own in- judgment, and decisions are minimized and terests and from a sense of responsibility to the technology (in this case a computer) directs, their workers and to the larger society. This controls, and paces what a worker does. is a significant cost to the employer. While in the long run it may increase the produc- Office automation can be used to de-skill tivity benefits that the organization seeks, it tasks. It is, and has been, so used in many may also defer the realization of sought for organizations that process huge volumes of cost reductions. standardized data. More data can be processed in a given time, by less highly trained (and Workers just entering the labor force also lower paid, more easily replaced) workers, with need training, at least in specific tasks or with less variability in outcome and-supposedly specific systems. Those aspiring to manage- but not always in practice—with lower error ment positions increasingly seek advanced rates. Professional tasks can also be de-skilled, training in business and business technology by building sorting rules, decision trees, and before entering the labor market. In recent dec- analytical processes into computer processes ades, there has been a strong trend toward and software packages. externalizing training costs and lateral recruitment-i.e., depending on colleges and For the worker, this may mean less job in- commercial schools to train workers, and hir- terest and satisfaction and increased stress. ing from the outside at the management level Factory-like offices could repeat the worst mis- rather than advancing people from lower levels takes and problems created by manufactur- within an organization. Enrollment in business ing assembly lines. However, rationalizing schools, vocational schools, and adult educa- work (i.e., simplifying and routinizing it) can tion courses has been rising. The students, also create new white-collar jobs for people rather than an employer, bear the cost of this with less ability and training than is required training; but since it is often out of reach for for some other office work. These jobs are lower income families, this raises questions highly valued by people whose employment about equitable access. opportunities are limited, or who are just entering the job market. Public schools and community colleges are to some degree handicapped by the costs of Office automation can also be used to en- providing instructors and a wide range of hance jobs, by relieving people of routine equipment for students to learn on, especially repetitive steps. Jobs can be designed to inte- since the technology is constantly changing grate simple tasks into fewer broader tasks and instructors themselves must be continu- so that the worker has a better sense of the ally learning. Commercial schools may be in purpose and outcome of the work. Informa- Ch. 1—The Outlook for Office Automation Technology, 1985-2000 . 19 tion systems can also give a worker access to nizations may learn from the experience of in- knowledge that could previously be obtained dustry leaders and thus shorten their own only through advanced professional education, troublesome transition period. and thus allow a nonprofessional worker to Both in terms of productivity (because of take over interesting tasks previously consid- the importance of motivation and job satis- ered the privileged province of the professional. faction) and in terms of equity and quality of For example, clerks can use computerized data- work life, problems of work de-skilling, occupa- bases to search for information that formerly tional downgrading, and disappearing job lad- only a lawyer, medical doctor, biologist, or ders could result in serious social problems. Ph.D. in history or anthropology would have The handling of such problems is, in our sys- known about. Some organizations are deliber- tem, usually a management prerogative or a ately using office automation to upgrade and matter for labor-management negotiations. enhance work at all levels. As a result, they Experience shows that the most fruitful strat- can sometimes develop a flatter institutional egy, both in terms of productivity and job structure and reduce the costs of management. satisfaction, is usually some form of worker Other kinds of organizational restructuring participation or representation in the search are likely to occur. There is evidence that adop- for solutions. Less than 20 percent of office tion of large computers tended to lead to cen- workers in the United States are represented tralization of control. Adoption of end-user by unions (although the growth of white-collar computers could lead toward some decentral- unions is said to be a high priority for labor ization of decisionmaking. These shifts in pow- organizations at this time). Organizations are er depend less on the characteristics of the now using or experimenting with other mech- technology than on the characteristics of the anisms for worker participation in decisions organization and its management strategy. related to technological change and job design.

Almost always some redesign and restruc- Office Workers and Their Workplace turing of the flow of work is necessary, leading to shifts in responsibilities, jurisdictions, With more and more Americans working in allocation of resources, and relationships be- offices, there is growing attention to the qual- tween coworkers and between working groups. ity of work life in offices, to job satisfaction, Communication patterns within the organiza- and to the effects of office work on physical tional hierarchy are likely to change. Typically and mental well-being. Office automation has problems arise over “ownership of informa- aroused some added concerns in terms of the tion” and responsibility for assuring the in- long-range effects of physical and mental tegrity of organizational data banks. stress, and fears related to work with computer video display terminals (VDTs). There is more flexibility in implementing office automation than in most changes in basic Workers using VDTs have increased com- technology; thus management has an even plaints about eyestrain and musculoskeletal greater responsibility for the outcome. The problems. Better workstation design, improved ways in which organizations are implement- human/computer interfaces, and work breaks ing office automation and redesigning their from long periods of VDT work can greatly work processes are rich in innovation and alleviate these problems. There is no evidence diversity. Results in terms of productivity will as yet that such problems, while serious in be a matter of debate for some time to come. terms of day-to-day discomfort, lead to any Some organizations will be disappointed in organic deterioration or chronic disease or ill- their expectations, and this may make others ness. However, evidence from other occupa- more cautious about moving into office auto- tions with heavy workload and repetitive tasks mation. But a great deal of cross-learning and suggests musculoskeletal strain in VDT work shared learning is occurring, and many orga- may lead to chronic health effects. There has been serious concern over reports In some countries, there is already legisla- of clusters of reproductive failures and acci- tion or regulation related to office automation dents among clerical VDT workers. Epidemio- and quality of work life; for example, West logical investigation has so far not explained Germany and France have regulations requir- these scattered clusters; but scientific research ing regular eye examinations for VDT work- has failed to find any possible cause related ers, and in Sweden there are standards calling to VDT technology. for periodic work breaks. OTA has reviewed current information and ongoing research in this area and concludes that Data Security and Confidentiality there is at this time no good basis for fear of VDT effects on reproductive processes. Scien- Data security and the confidentiality of data tific research should continue to be monitored in computers and data banks is a continuing for new findings. concern. End-use computing adds to these concerns primarily because there is wider access However, office automation can increase to data and to means for manipulating it; data stress on users. Stress is not always bad; it disks are easily lost, stolen, destroyed, or cop- can be viewed as increased challenge. But some ied; computers are linked to other computers forms of continuing, unrelieved stress are providing greater access; and small computers clearly harmful. Concern in the past has em- are not usually monitored or physically guarded. phasized the so-called “executive heart at- Control of databases is often separated from tack, ’ but there is growing evidence that cler- responsibility for their integrity and reliabil- ical workers are most likely to suffer from ity. Most end-users are not as well informed continued stress. Computer pacing and com- about the requirements of confidentiality for puter monitoring, which result in reduced au- client and employee data as are computer pro- tonomy or control over one’s work and per- fessionals. In addition, office automation often formance level, or which induce continuing allows work to be done away from the office, visual and musculoskeletal strain, significantly in airplanes, at home, or in client offices, which add to stress. Fear and anxiety over one’s abil- further increases vulnerability. ity to learn and perform effectively or to change one’s management and supervisory Data can also be destroyed or made tem- strategies, as well as perceived job insecurity, porarily inaccessible by accidents, electrical create stress. There is increasing evidence that outages, or natural disasters. As more and long-term high levels of stress are conducive more data exists only in electronic form, and to several kinds of chronic illnesses. as day-to-day operations become more dependent on technology, there is greater need for Visual and musculoskeletal problems cur- secure back up. rently can be alleviated through appropriate office and workstation design; stress-related ill- Federal agencies, like private sector organi- ness or disease is more difficult to control and zations, are faced with new problems in pro- may emerge as the greatest public health prob- tection of data security and confidentiality as lem among office workers in the future. a result of decentralized office automation. But government offices have, in many cases, been Involvement of workers in decisionmaking more sensitive to this problem than has in- about office automation and work redesign ap- dustry in general. Personal data about Fed- pears to reduce stress levels. Organizations eral employees or agency clients, however, may that have successfully sought the participa- be inadequately protected. tion of users at all levels of the organizational hierarchy have reported that this led to higher There are both technological and procedural productivity. means for protecting data. Most organizations Ch. l—The Outlook for Office Automation Technology, 1985-2000 ● 21 have established these with regard to central- tion, tending to depress the general level of ized EDP operations, but often overlook the vul- clerical wages and preserve the segregation nerability y of data processed by end-user devices. of women into the lowest level office jobs. They Organizations moving into office automation for also argue that it is difficult to assure the work- the first time may not realize the threats until ers of safe and healthy working conditions; serious problems arise. and that it weakens social pressure for the establishment of child day care centers, ac- Home-Based Office Work commodations for handicapped workers in the office, and other social services needed by A special and important capability of office workers employed under more conventional automation technology, resulting from the con- conditions. vergence or combination of information and communications technology, is to allow work A work-at-home opportunity at present is to be done at a distance from the office. The almost always sought by the worker, not forced worker’s home can become the primary work by the employer. The most common reason site. Home-based clerical work, with the work is the need or the wish to combine paid em- performed on a piece-rate or hourly basis, could ployment with care of children or other house- increase significantly in the next few years. Al- hold responsibilities. Some home-based work ready controversial, it would then become much programs are designed for physically handi- more so. capped or retired workers. The opportunity to work at home is highly At present only a few thousand people are valued by many workers. Many professionals engaged in homebased clerical work. However, now do part of their work at home, by their the technological and economic conditions ex- own preference and at their own and their em- ist for substantial expansion in the future. If ployer’s convenience. This flexibility is mutu- home-based workers begin to compete with ally beneficial and should be protected. A sec- office-based workers for a shrinking number ond kind of home-based, computer-mediated of clerical jobs, then this issue will be much work is the performance of office services (e.g., more highly visible and controversial. word processing, data entry, analytical studies, Bills have been introduced before Congress computer programming, or consulting) by en- that would encourage home-based computer trepreneurs who establish small businesses in work by means of tax credits. The AFL-CIO their own homes. They sometimes find bar- has called for a ban on home-based clerical riers to operating their businesses in the form work. Other groups argue for enforcement of of zoning laws or confusing tax provisions, but existing occupational safety and health laws such ventures are proliferating in spite of this. and other worker protection laws in home- Many women, in particular, are gaining busi- based work. ness skills and experience in this way. There are legal questions to be resolved re- A more controversial form of home-based garding the status of some of those designated office work is the farming out of clerical office as independent contractors; IRS has recently work (e.g., data entry and word processing) ruled that those accepting work only from one to be done in homes, usually by women and employer/organization must be regarded for especially by mothers of small children. Home- at least some purposes as employees, not con- based workers are often paid at piece-rates or tractors. hourly rates. They may be former employees converted to the status of independent con- Off-shore Performance of Office Work tractor, thus giving up employee benefits. Critics object to this form of home-based work Some U.S. firms have relocated their data- on the grounds that it eliminates jobs for regu- entry operations to other countries to take lar employees and constitutes unfair competi- advantage of low labor costs. Intermediary en- 22 ● Automation of America’s Offices

trepreneurs also make off-shore data-entry pering networking within agencies and between services available to U.S. firms. Recent ad- agencies and field offices; and the lengthy vances in communications technology are mak- procurement cycle for large systems, which ing this activity increasingly cost effective, and is out of step with the rapid evolution of the it is also being encouraged by the Federal Gov- technology. ernment as a mechanism for assisting economic Gains in Federal office productivity are ob- development in Caribbean countries. However, vious, yet hard to measure or document. Some if predicted technology developments reduce agencies have been able to handle greatly in- the need for large-scale data entry, off-shore creased workloads without a proportionate in- sourcing of data entry will probably cease to crease in the work force. There are, however, expand. built-in disincentives to achieving maximum Off-shore clerical work for U.S. firms now cost reductions. Government managers are involves only a few thousand workers, chiefly offered few rewards, and may suffer subtle in the Caribbean countries but with some in penalties for reducing the number of people the Far East and India. With further improve they supervise or cutting their annual expend- ment in communications services, this activ- itures. Grade level or promotion may depend ity could expand considerably in politically sta- on the number of people one supervises, and ble developing countries in many regions of unexpended funds may encourage further the world. The governments of many develop- stringent budget cuts. ing countries, and U.S. economic development There has been strong pressure by the Ad- experts, perceive valuable potential benefits ministration to reduce Federal employment. in encouraging this activity. It does, however, There are some indications that office auto- represent a direct loss of U.S. data-entry jobs. mation may have already contributed to curb- ing the growth of the Federal work force. A Federal Government Office significant reduction in the number of clerical Automation workers and a change in the ratio of clerical to professional and administrative employees Effects of office automation will be felt in seem to have occurred, along with changes in public sector as well as private sector offices. job content and skill requirements that are In Federal Government offices these effects likely to continue to accelerate. have implications for procurement policy, personnel policies, and budgetary planning. They The Federal Government has a responsibil- may have implications also for the delivery ity to see that changes in Federal white-collar of government services, the access of citizens employment, working conditions, and career to government information, and the ability of opportunities are managed smoothly, equita- citizens to participate in public decisionmak- bly, and with due concern for civil service em- ing. This report only briefly considers such ployees. There should be continuing reexami- effects on the quality of governance, primar- nation of job classifications and classification ily in terms of the possibility that loss of ac- criteria. Uncertainties in future employment countability could result from erosion of estab- levels should affect present recruitment and lished bureaucratic communication channels. hiring, and projected changes in future employment needs should also guide the planning for Present procurement and acquisition policies retraining and redeployment of present em- have, in general, allowed the Federal Govern- ployees. Such changes are not being systemat- ment to keep pace with the private sector and ically tracked, studied, or considered in per- to adapt office automation technology to the sonnel or budgetary planning. needs of Federal agencies. There are some con- spicuous exceptions and some unsolved prob- Since 1975 there has been a slight rise in lems. Chief among these problems are the lack average grade levels, which was strongly crit- of compatibility among devices, which is ham- icized by the Grace Commission as overgrad- Ch. l—The Outlook for Office Automation Technology, 1985-2000 . 23 ing. The changes in occupational distribution gress because of the vital role that these orga- (i.e., a smaller proportion of clerical workers) nizations play in job creation and in innova- may have contributed significantly to this tion. Small computers and improved software slight rise. Neither the Office of Personnel packages appear to make office automation Management nor Congressional Budget Office more practical for small organizations, but can has accounted for this factor in their analysis still represent a significant capital investment of the grade level rise. If the number of lower in comparison to their assets. The time re- level workers has been reduced, and will be fur- quired to make informed decisions about equip- ther reduced, then efforts to hold constant the ment, to redesign work procedures, and to train average grade level will significantly hinder the staff, plus the lack of in-house expertise in trou- ability of the Government to attract and hold ble shooting and problem solving are also sig- highly qualified middle and upper level em- nificant problems. ployees. Although computer vendors identify small business as an active and growing market, there State and Local Government Offices is little empirical evidence about the results of their experience with office automation so far. State and local governments are struggling Optimists hope that automation may allow to manage an increased workload, partly re- small firms to expand their markets and suc- sulting from present Federal policies, without cessfully compete with larger organizations. a proportionate increase in staff. The more Pessimists fear that many will incur capital than 78,000 governmental units in this coun- costs beyond their ability to support. Their try show a rich diversity in approaches to of- experience should be carefully monitored for fice automation, both in large systems for emerging public policy concerns. many governmental operations and more recently in end-user computing. Small cities and Working Women and Minorities rural counties are lagging in use of office automation, in spite of the opportunities presented The effects of office automation are of par- by microcomputers. In part, this probably re- ticular concern to women. Most clerical jobs sults from lack of access to expertise to help are now held by women, and one-third of work- them in choosing and supporting office equip- ing women are in clerical occupations; they ment and training workers. are vulnerable to displacement. Women now There is, at this early stage, little informa- in clerical positions are trying to move into tion about the aggregate effect of automation managerial and professional jobs, but some on local and State government offices across the job ladders may be truncated by automation. country. Evaluations of productivity so far In managerial and professional occupations show mixed results. Some researchers, in spe- that are vulnerable to office automation, wom- cific States and localities, have found evidence en tend to have less seniority than men. On of increased productivity and of work force the other hand, some new jobs and occupa- reduction, others have not. Some researchers tions, offering good potential for advancement, have reported findings of standardization and are being created by office automation; access depersonalization of government services, of to education and training for these specialties is vital for women. strong reinforcement of the existing distribution of bureaucratic and political power, and As skill requirements and training prereq- of increased difference in the relative access uisites for traditional office jobs change, their of citizens to government information. comparability to other jobs changes, but these shifts may not be reflected in changes in job Small Business and Office Automation titles or even in formal job descriptions. De- bate over pay equity and comparable worth re- The effects of office automation on small quires understanding of the changing nature of businesses are of particular concern to Con- office work and its changing skill requirements. Office automation is also of particular in- Minorities, especially Black and Hispanic wom- terest to minorities, and for similar reasons. en, are disproportionately represented in jobs Clerical jobs have often been the first step in likely to be directly affected by office auto- white-collar work for disadvantaged groups. mation.

POLICY ISSUES FOR CONGRESS

A number of policy issues have been identi- —proposals to encourage or to ban home- fied above, and are discussed in more detail based office work, and in the following chapters. OTA has concluded –largely unexamined relationships be- that: tween pay equity and comparable worth questions and the changes associated Many of the concerns that have been with office automation. raised with regard to office automation ● There are also specific issues of concern are transition problems that will be solved to Congress in its oversight of Federal by market forces and by the common agencies and activities, including: sense and ingenuity of users—they do not —the implications of Federal office auto- require Federal action of any kind. mation for procurement, personnel, and Some concerns–most importantly, the budgetary policies, and possible effects on future white-collar em- —adequacy of present provisions to as- ployment levels—are matters of long-term sure data security and confidentiality national interests. They merit watchful at- and continuation of Federal functions tention, and Congress should begin now under emergency conditions. to make sure that the nation is prepared ● An emerging issue, which may become to deal with them if and when conditions more important and more controversial in warrant action. This however will be dif- the near future is the beginning trend ficult to do, because the capability to de- toward off-shore sourcing of data-entry tect and understand emerging structural work. change in the economy is poor. Better eco- ● There are several groups for whom the nomic and employment data and develop- effects of office automatic are particu- ment of improved forecasting techniques larly important and whose interests merit are urgently needed. special attention: There are a few specific issues of immedi- —women in clerical, managerial, and pro- ate concern; some of them are already the fessional office positions, subject of legislative proposals before Con- —minority workers, and gress or State legislatures. These include, —small business firms. for example: –documented or suspected health problems associated with office automation,

FURTHER DISCUSSION: POLICY ISSUES AND QUESTIONS Employment fice jobs is already affecting large numbers In the immediate future, the anticipated ef- of people. It is therefore attractive to think fects on employment are only possible or prob- of immediate actions that would position Con- able. There is little evidence that decline in gress to act in timely fashion when and if the growth in, or reduction of, the number of of- need becomes real. A prudent preparatory Ch. 1—The Outlook for Office Automation Technology, 1985-2000 25 strategy would be systematic monitoring and data have little capability, and few resources, research to clarify the emerging effects of of- for understanding advanced technology and fice automation and provide an alarm signal the way it is likely to evolve in the future. The if they seem likely to exceed acceptable limits. Federal agencies with the most highly devel- This would require actions to improve the col- oped knowledge of new technology, including lection and collating of occupational and em- computer technology, have no clear mandate, ployment data, and improved mechanisms for little capability, and few resources for analyz- monitoring and analyzing structural changes ing economic and employment effects. More- in the economy. over, the primary government source of forecasts of commercial information technology, It is difficult to track and demonstrate even the institute of computer Science and Tech- long established employment trends because nology of the National Bureau of Standards, the kinds of data collected by the Bureau of has recently suffered a severe cut in support the Census, the Bureau of Labor Statistics, of its planning and forecasting functions. and other government agencies change over time. The way in which those data are aggre- This indicates that the ability of Congress gated or disaggregated, and the way they are to be apprised of disturbing trends in office labeled also change. The various bureaus and employment, or the broader area of whitecollar agencies differ, at any one time, in the way employment, should they occur, is not likely they define categories, so that their data often to improve in the future unless steps are taken cannot be compared and the data from one to ensure that this capability is being devel- agency cannot be used to augment and sup- oped within Government or that support is plement, or explain, data from another agency. available for such research and analysis out- For example, cashiers may or may not be inside of the Government. cluded with other clericals; “Federal employees’ may or may not include postal workers If it should become clear at some future point and congressional employees; part-time work- that white-collar employment is indeed not ers may or may not be distinguished from full- growing, or if there are signs of increasing time workers. Sometimes only a highly spe- structural unemployment, then Congress will cialized data expert can disentangle employ- need to consider interventions. At a minimum ment data to address a simple question; some it may be necessary to take steps to assure questions cannot be answered at all because that changes in employment opportunities do data does not exist. It maybe impossible, for not differentially burden certain groups of example, to determine when, and under what workers, for example, women and minority conditions, blacks entered office employment workers. Workers in low-level clerical jobs may in significant numbers because no records of need special assistance in finding other em- black/white employment were made until re- ployment. Steps may be needed to assure that cent years. there are entry level jobs for untrained workers, with on-the-job training opportunities. What data is collected and how it is recorded depends, of course, on what questions one ex- Sometime within the next 15 years it could pects to address. At the present time, no Fed- become necessary for Congress to take posi- eral agency has a clear mandate, nor the avail- tive steps to deal with a declining number of able resources, to develop an indepth capability office jobs or white-collar jobs, whether or not for economic and employment forecasting of the economy as a whole remains strong. What the kind Congress and the executive branch steps are appropriate will, however, depend will need in a future in which technological in part on whether there are available jobs in change will be continuing and rapid, and will other employment sectors for which office have pervasive effects on all economic activi- workers may be retrained. The many strate- ties. Those agencies with primary responsi- gies for consideration in responding to high bility for collecting economic and demographic levels of employment have not been a focus 26 Automation of America’s Offices

of this assessment; they have been discussed leges to provide retraining and continuing many times in many places in continuing de- training programs; establish accreditation for bates about long-range employment policy. commercial wh.itecollar vocational schools; or They include “share the work” or shortened direct the Departments of Labor and Educa- workweek strategies, strategies to stimulate tion to develop guidelines for vendors and em- economic growth and the creation of new in- ployers in designing training programs. Should dustries, and strategies to ensure or augment there be signs of developing structural unem- family incomes. Most discussions of such pol- ployment among clerical workers, Congress icy actions in the past have focused on blue- might then consider providing loans or other -collar unemployment. Their use to deal with assistance to white-collar workers seeking whitecollar unemployment would require care training or retraining to move into other jobs ful consideration of the economic, social, and and occupations. political conditions under which they would operate. Labor/Management

Conversion to Part-Time, Temporary, In general, the transitional problems involved in changing the technological base of and Contractor Status an organization are best solved by the cooper- A large increase in the number of full-time ative efforts of managers and workers in rede- jobs lost to part-time or temporary workers signing the work process and organizational without worker protection mechanisms (per- structure. The public interest in this process haps Occurring due to office automation) could is that of realizing the promise of increased ultimately burden taxpayers or lead to degra- productivity for the economy and encourag- dation in the level of social well-being. If Con- ing fair play for those whose jobs and occupa- gress chooses to intervene, it could constrain tions will be affected. Because most office conversions of employees to other status by workers are not represented by unions, man- legislative confirmation of recent IRS rulings agement has a particular need and responsi- that an independent contractor accepting work bility to provide opportunities and mecha- from only one organization is in fact an em- nisms for involving employees in decisions ployee; a mandatory minimum ratio between about technology and its implementation. Giv- full-time and part-time or temporary employ- en a minimal Federal role, Congress may wish ment; or mandatory pro-rating of benefits to consider the desirability of educational or packages and social security contributions. Al- information programs for employers, employ- ternatively, Congress could alleviate some of ees, and their associations with regard to prob- the problems of involuntary part-time employ- lems associated with office automation and ment by further actions to encourage or re- strategies that organizations have successfully quire Voluntary Reduced Work Time arrange- used for alleviating them. Other possibilities ments, making involuntary part-timers eligible to be considered under some circumstances are for partial unemployment benefits. clarification of worker rights under existing labor-management negotiation procedures, or Training changes in labor law to require worker involvement in technology-related decisions. Because continuing training and education are essential both to realize the productivity Health and Safety gains that office automation promises, and to alleviate undesirable effects on employment, In view of the concern about suspected haz- Congress may want to consider actions to ards associated with computers and VDTS, op- assist public school systems in planning and tions for Congress to consider include: 1) a pub- upgrading white-collar vocational training; en- lic information program to inform employers courage school systems and community col- and office employees about what is known Ch. 1— The Outlook for Office Automation Technology, 1985-2000 . 27 . about the effects of office work on health and Existing Federal privacy and security laws well-being, and what can be done to reduce are largely designed to strengthen the ability visual and musculoskeletal strain and psycho- of an individual to challenge the use of infor- logical stress; and 2) directing the Occupational mation about himself or herself. If lack of Safety and Health Administration to develop attention by organizations to data protection ergonomic advisories, guidelines, or standards in decentralized computing leads to serious for use in public and private sector offices and abuses, Congress may need to consider more in design of equipment and furniture used in stringent data protection laws, including lia- office automation. bility for breaches of privacy and security. If these actions and self-initiated organizational management actions to alleviate these Home-Based Clerical Work concerns are inadequate, then Congress may Because this activity is already controver- wish to consider legislation limiting the num- sial, Congress may have to formulate policy ber of hours that workers can be required to regarding it within the next several years. spend continuously in VDT use. Proposals have been made in Congress to pro- In any case, because scientific evidence is vide tax credits for the purchase of computers still equivocal, and significant risks involved for home-based work (and other nonrecrea- in computerized office work would affect a tional uses). Other ways to encourage home- large proportion of Americans, Congress could based work include legislative actions void- support the funding of research on the rela- ing IRS rulings and court decisions that make tion of stress to chronic disease and illness many home-based workers employees rather and on the possibility y of reproductive hazards than independent contractors, and removal of related to VDT use. It may also wish to estab- other regulatory or tax barriers to home-based lish national mechanisms to monitor the health work. status of American office workers. However, Congress may instead wish to discourage home-based computer-mediated cler- Data Security and Confidentiality ical work. It could then consider a ban on paid computer-related employment when the pri- Previous actions to increase data security mary or sole work site is the worker’s home, and ensure confidentiality in the handling of but would probably wish to distinguish this information about citizens have concentrated employment from similar activities designed on risks from large centralized computer oper- to establish entrepreneurial small businesses. ations. Most organizations have been slow to Congress may, instead, wish to clarify through recognize additional risks to confidentiality legislation the conditions under which home- and security that come with decentralized com- based workers are employees entitled to the puters. These risks are largely related to the normal worker protections afforded by law and increased access to organizational data banks; equity, and to require pro-rated benefits for the portability of data storage media; and the workers accepting work to be done in their lack of knowledge among general users about homes. privacy laws, the principles of confidentiality, and established practices for safeguarding Instead of banning or strongly discourag- data. Information about clients, employees, ing home-based office work, Congress could and corporate resources and activities is sub- insist on rigorous application and enforcement ject to compromise or misuse. Organizations of existing worker protection laws and regu- need to develop policies and practices that bet- lations to home-based work, including wage ter protect the confidentiality and security of and hour laws, occupational safety and health data that is processed or stored by small com- regulations, and all applicable reporting re- puters or other end-user devices. quirements. This strategy would require —

strengthening the resources and capabilities procure state-of-the-art systems, and to plan available to enforcement agencies. toward integration and networking of Federal microcomputers and related devices. Rather than banning or discouraging home- based work, Congress could adopt a strategy of increasing the range of employment options Federal Personnel Policy for workers through tax deductions or provi- To assure that emerging effects of office sion of day care centers; alternative means of automation are effectively managed, with full caring for children, aged, or disabled depend- regard for the rights and interests of civil serv- ents; and by further acting to increase main- ice employees, Congress may want to consider stream employment opportunities for handi- asking the Office of Management and Budget, capped workers. the Office of Personnel Management, and CBO to conduct studies and prepare recommenda- Off-Shore Office Work By or tions for changes in personnel recruitment, For U.S. Firms retention, job classification, and promotion and compensation policies to reflect changes in per- The issue to be resolved here involves the sonnel needs, job content, and skills require- desire for cost-saving for U.S. firms and eco- ments resulting from office automation. nomic development in Third World Countries v. the demand for preservation of clerical jobs in the United States. Congress may wish to State and Local Governments encourage off-shore sourcing, which could be Federal policy is to shift responsibility for done by extending further technical assistance many decisions and programs to the local level. and information to interested companies in the To handle these programs effectively and at United States and to development officials in the lowest cost to themselves, local govern- prospective host countries, or merely by tak- ments need to increase office productivity. ing no action that would counter presently Small government units are lagging in auto- favorable market forces. mation. Congress may want to consider block If Congress wishes, on the other hand, to grants to State governments for this purpose, discourage off-shore sourcing, it could do so direct technical assistance to small city and through restrictions on data flow; additional county government units, or other means of privacy protection laws, requirement for more assisting small governments in office auto- extensive security measures, etc.; regulations mation. analogous to “local content” or “buy national’ requirements; imposition of taxes or tariffs, Small Businesses such as value-added taxes or trigger price tariffs; limitations on the availability or use of Although there is a risk that small busi- dedicated telecommunications lines; or an out- nesses will create fewer jobs if they are en- right ban on offshore sourcing. couraged to automate their offices, this could be offset by increased viability and competi- Federal Procurement Policy tiveness, and enhanced opportunity to grow. Little is known as yet about small business The present procurement policy for automat- office automation. Congress may wish to con- ing Federal offices has worked well, but there sider requesting a study from the Small Busi- are some problems impeding further progress. ness Administration or other Federal agencies Congress may want to consider asking the of the potential opportunities for and conse- General Accounting Office and the Congres- quences of office automation in small busi- sional Budget Office (CBO) to reexamine the nesses, especially with regard to their overall effects of present procurement policies and reg- viability and their role in innovation, local eco- ulations on the ability of Federal agencies to nomic development, and job creation. If addi- Ch. 1–The Ouflook for Office Automation Technology, 1985-2000 ● 29

tional evidence suggests that there is a public ● take explicit notice of these concerns and interest in assisting small business office auto- factors in discussion of bills concerning mation, options to be considered include an pay equity and comparable worth, which information and education program for small are now before committees; organizations considering office automation, ● provide incentives for maintaining or im- or specific technical assistance or financial loan proving ratios of female to male employ- programs for small businesses for the purpose ment in labor force reductions associated of office automation. with automation; ● provide incentives for maintaining the Women and Minorities share of employment held by minority groups in office work; and If office automation reduces the number of ● provide subsidized child care facilities or office jobs, women and members of minority increased tax deductions for child care to groups who have historically been disadvan- increase the employment options open to taged in the job market, are likely to be most working parents. negatively affected. Congress may then wish to consider a series of steps to alleviate their disadvantage. It could: Chapter 2 Productivity and Employment Contents

Page The Uncertain Outlook...... 33 The Framework for Analysis ...... 34 What Follows...... 36 Recent Labor Force Projections ...... 37 Productivity and the Nature of White-Collar Work...... 45 How Office Automation Affects Employment ...... 47 Emerging Occupational Shifts ...... 50 Technology and Recent Trends in White-Collar Employment...... 56 Part-Time and Temporary Employment ...... 59 Analogies From Past Waves of Automation ...... 64 The Future White-Collar Labor Supply ...... 67 Conclusions ...... 68 Policy Considerations: Labor Market Adjustment Options ...... 68 The Need for Monitoring of Structural Economic Change Related to Information Technologies ...... 68 Longer Range Policy Options ...... 69 What Action Is Needed Now? ...... 71

Tables Table No. Page 2-1. Growth unselected Occupations as Projected by the Bureau of Labor Statistics, 1982-95 ...... 38 2-2. Percent of Total Work Force in Occupational Groups by Selected Industry Sectors, 1982 ...... 51 2-3. The Growth in the Number of Clerical Jobs, 1950-84 ...... 57 2-4. Changes in the Percent of Total Employment for Involuntary and Voluntary Part-Time Workers as Percent of Total Employment, 1968-84...... 59 2-5. Shifts unemployment by Industry Sectors, 1900-80 ...... 65 2-6. National Unemployment Rates During Recession Troughs and Recovery Peaks, 1961-84 ...... 66 Figures Figure No. Page 2-l. Framework Describing the Relationship of Office Automation to Changes in the Number of Office Jobs...... 35 2-2. Framework for Analyzing Long-Range Effects of Office Automationon White-Collar Employment ...... 50 2-3. Changing Percentage of Work Force From 1900-80 White-Collar Compared to Blue-Collar...... 56 2-4. Capital Investment Per Production Worker, 1970-80 ...... 57 2-5. Changes in the Percent of Total Employment for Involuntary and Voluntary Part-Time Workers, 1968-84 ...... 59 Chapter 2 Productivity and Employment

Office automation promises an increase in slowing growth in the number of office jobs, and productivity in all sectors of the U.S. economy, eventually, an absolute reduction in the num- because all industry sectors increasingly de- ber of jobs in offices from some peak in the 1990s. pend on information as a major component While the latter outcome is by no means cer- of products and service. Office automation will tain, there is sufficient evidence pointing in significantly reduce the number of jobs re- this direction to justify watchful concern by quired for a given volume of information- Congress, and to merit efforts to improve the handling work. It will also fuel a growing de- monitoring of employment trends so that cor- mand for information and information proc- rective or compensating actions can be taken essing. when and if they are needed. Recent employment forecasts should not lull policy makers Thus, it is possible that there will be con- into complacency. This is an area fraught with tinuing strong demand for additional office uncertain y. workers. The most likely outcome is, however,

THE UNCERTAIN OUTLOOK The first two conclusions—that work re- negative effects would be muted. If there is quired for handling a given volume of infor- strong economic growth, then office employ- mation will decrease, and that demand for ment could continue to grow, although more information will grow-can be made with con- slowly than in the past. Strong continuing eco- siderable certainty. Between these two con- nomic growth like that of the 1950s and 1960s clusions and the third, that the number of of- is not, however, certain in the future. fice jobs may ultimately decline, lie several large questions. The most important is, “how The overall employment effects of the first much will the total volume of information-han- phase of office automation, the large com- dling increase?” Second, what are “informa- puters installed in the 1960s and 1970s, have tion-handling” jobs, and which ones will be been hard to detect amid other changes in the affected? Third, if there is a stable or lower economy. But the second phase of office auto- demand for white-collar work, are there ways mation, decentralized computing and advanced of adjusting without creating structural un- communication capability, is spreading rap- employment ? idly. The third phase, the evolution of integrated office systems or networking, will bring This assessment indicates that, with the about much restructuring of the flow of work amazing capability inherent in computer and in and between offices. communications technologies, even the needs of a thoroughly information-driven economy Delayed effects of the first phase and the do not, in the long term, assure rising levels emerging effects of the second and third phases of white-collar employment equal to growth are overlapping. From this perspective, it is of the labor force. That labor force by the year possible to see the latent productivity enhanc- 2015 will be about 142 million people or 35 ing effects of office automation as water build- percent larger than it is now. But the number ing up behind a dam. The dam is made of insti- of people entering the work force each year tutional inertia and the unavoidable transition is declining. If the transition to stable or declin- problems. When that is removed, there could ing office employment is slow enough then the be a flood of work force reductions, unless

33 34 . Automation of America's Offices — workers are channeled into productive new jobs ures of increasing productivity. There are other and industries. signals of pressure on employment growth despite continuing job creation. During recent Organizations often resist laying off work- business cycles, unemployment rates in “busi- ers when they adopt labor-saving technology, ness recovery years” have remained higher preferring, when possible, to let attrition solve than they were in recession years before the the adjustment problem. This is one example mid-1960s, in spite of the creation of thousands of institutional inertia. But every year some of new jobs. The number of involuntary part- firms go out of business and some new busi- time workers is continuing to grow. These nesses are started. New organizations are like- indicators are not tied directly to office auto- ly to use new technology from the beginning, mation, yet there is a strong possibility that creating fewer jobs than new starts would some of the effects on employment oft wo dec- otherwise create. This is probably already hap- ades of office automation are now becoming pening; for example, Dun and Bradstreet re- apparent. ported that in 1984 more new firms were started than in 1983, but they employed nearly 5 percent fewer people. In the financial, insur- The Framework for Analysis ance, and real estate industries, which are the The long range effects of office automation leaders in office automation, the number of on office employment are pictured, in figure workers hired by new organizations declined 2-1, as a dynamic interaction between: by over 9 percent. ’ If new organizations tend to create fewer jobs because they make effec- ● growth in demand for information, and tive use of new technology, then employment the labor-saving characteristics of office effects would tend to accelerate over time. automation technology. Which white-collar jobs will be affected? Information handling and communication Most directly and strongly, they will be cleri- play a larger and larger role in all economic cal jobs. The number of professional and man- activities. This is what is meant by an “infor- agerial jobs is apt to be less strongly affected, mation society. ” Computers whet the appe- and professional work may continue to expand tite for information. More kinds of informa- indefinitely in an information society. How- tion can be collected. It can be analyzed in more ever, even managerial and professional jobs ways, thereby producing still more informa- are not immune from the labor-saving effects tion. All of this data can be used in new ways of office automation. and easily communicated to more people. Businesses are now engaged in strong ef- Organizations are likely to find more inter- forts to reduce labor costs and to increase nal or intermediate uses for information, and productivity. Forbes Magazine reported that to produce new information-intensive services the nation’s 500 largest publicly owned com- or products as office automation technology panies (which account for about a fifth of all makes it possible to combine, package, and civilian employment) expanded their total sales distribute information in innovative ways. in 1984 by 4 percent and at the same time Consumer expenditures appear to be shifting shrank the number of people on their payrolls from hard goods to soft goods and services, by 4 percent, or 840,000,2 Sales per employee as evidenced by the growth in service indus- rose by 10 percent, and assets per employee tries and in particular by the proliferation of rose by 11 percent; these are two rough meas- new financial services in recent years.

The 10~,329 new starts in 1984 hired 578,838 workers Because information-handling costs have al- compared to 607,416 new hires for the 100,868 new starts in ways been primarily labor costs, and because 1983. See “Dun and 13radstreet Looks at Business, ” a Dun office automation technology is labor-saving, and l~radstreet subscriber newsletter, vol. 3, No. 3, ill ay-June 1985. it is assumed that the cost of information- -Forbes hJagazine, Apr. 29, 1985, p. 231. handling will decrease. This should, accord- —

Ch. 2—Productivity and Ernployrnent ● 35

Figure 2-l.— Framework Describing the Relationship of Office Automation to Changes in the Number of Office Jobs

cost Time-saving of (conventional information tasks)

New Labor-saving char’acterlstics of Demand for information + data input + office automation technology technolo~y

New information products and oservices \

SOURCE Off Ice of Technology Assessment

ing to standard economic theory, tend to fur- or logical difficulties. The interactions between ther increase the market for information. them are not well understood. There are other factors and forces acting on white-collar em- Office automation is adopted for many rea- ployment—and intermediate steps in these sons, and often reduction of the work force relationships —that are ignored in the simple is not one of the objectives. But it is, by na- diagram shown in figure 2-1. ture, labor saving, even when that is not a primary motivation for its adoption. This ar- Estimates of the relative magnitude of these gues for a significant reduction in the labor competing forces are judgment calls. Those necessary for handling a given volume of in- who see an increasing demand for information formation. producing an expanding need for information- handlers, and those who anticipate new indus- The statements made above are hypotheses tries or new occupations to create jobs for dis- or arguments often heard in discussions about placed office workers can not, in the nature whether office automation will lead to an in- of things, offer a valid description of what crease or a decrease in office jobs. The pur- those future products, industries, and jobs pose of this chapter is to examine these prop- might be. They are therefore often accused of ositions in more detail. They provide a basic optimism based on ungrounded faith. Those framework for discussing the long-range ef- who see disturbing signals of future job loss fects of office automation on future office em- can point only to fragmentary and widely dis- ployment. But there are several levels of com- persed evidence that is difficult to compare plexity that must be considered. Many of these or aggregate, and are equally subject to charges propositions involve, or conceal, definitional of ungrounded pessimism. 36 ● Automation of America’s Offices

Employment data is notoriously difficult to erally recognized; they have been and will work with because job categories and occupa- be masked during a transition period be- tional titles are not standardized and change cause of technical and managerial problems, over time. Projection of trend lines is not very and institutional inertia in adapting to helpful in discussions of significant technologi- technological change. (See “Productivity cal change, and arguments from analogy to and the Nature of White Collar Work.”) automation in the past are not convincing be- Office automation will reduce the need for cause the surrounding social and economic en- labor by sharply reducing the need for vironment has radically changed. both primary and secondary data entry; time saving in analytical, computational, These caveats do not mean that analysis is and communication-related tasks; direct useless; they only warn of the degree of uncer- substitution for labor in many tasks; elim- tainty necessarily involved. It is the task of inating intermediate and preparatory steps policy analysts to advance conclusions in spite or tasks; and transferring tasks from of incomplete evidence, as it is the task of pol- highly paid to lower paid employees (see icymakers to make decisions under conditions “How Office Automation Affects Work”). of uncertainty. Specialized occupations with narrowly defined tasks will be most directly and What Follows immediately affected (see “Emerging Oc- cupational Shifts’ ‘). Automation will elim- Since OTA’s conclusions about the possi- inate or reduce the need for tasks char- ble employment effects of office automation acteristic of some “generic” clerical are less optimistic than some recent long-range occupations (i.e., those common to most employment projections, these will be reviewed or all industry sectors). Growth of some to point out forces and factors that are usu- categories of management occupations ally not adequately accommodated by econo- may be sharply constrained or even re- metric models and that strongly affected the versed because of time savings in infor- conclusions of this assessment. These consider- mation collection, analysis, and format- ations have to do with the way in which tech- ting; time savings in communications; nological change erodes the validity of con- increases in scope of supervisory atten- ventional assumptions, disrupts long-term tion and monitoring capability; and reduc- trend lines, and changes the meaning of estab- tion in the number of workers to be su- lished categories of occupations and industry pervised. boundaries. There are already possible indicators of constrained employment growth from of- The conclusion that the number of office jobs fice automation, including declining unit may, between 1985 and 2000, tend to stabi- labor costs in the heavily automated fi- lize and possibly begin to decline, rests on the nancial, insurance, and real estate (FIRE) following points: industries (see “Technology and Recent Computers represent a fundamental tech- Trends in White Collar Employment”). nological change rather than a marginal Office automation could also encourage improvement; their adoption will resem- conversion of employees to part-time, tem- ble that of the telephone and the type- porary, or independent contractor status, writer rather than that of the industrial with a reduction in the number of full-time, robot. Office automation will be pervasive. permanent jobs (see “Part-Time and Tem- Recent technology/employment forecasts porary Employment”). are flawed and probably understate the Off-shore sourcing of clerical work, now employment effects of office automation. small in volume, could increase signifi- (See “Recent Labor Force Projections.”) cantly in the next decade (see chapter 8). The potential productivity benefits of of- Office automation may have more signif- fice automation are larger than are gen- icant or more highly visible impacts than —. — .— —

Ch. 2—Productivity and Employment ● 37 — —

earlier waves of mechanization and auto- The remainder of this chapter discusses mation in the United States because the these points in more detail, beginning with a economy will not be growing as rapidly, review of recent employment forecasts. It ends it will affect more occupations, and it will with a brief discussion of labor force growth, cut across industry sectors (see “Analo- possible adjustment mechanisms, and some gies From Past Waves of Automation”). policy implications. There are, in many cases, some signs that technology has contributed to rising unemployment rates since the end of World WarII.

RECENT LABOR FORCE PROJECTIONS

The Bureau of Labor Statistics (BLS) ex- cline in the average weekly work hours per pects employment in managerial, technical and worker, 3) productivity growth at the rates professional, and clerical occupations to in- of the late 1960s and early 1970s, and 4) some crease by about 28 percent by 1995.3 Most job shifts in employment, namely that “new labor- growth is projected to be in the service pro- saving technologies will cause shifts to occur ducing industries (transportation, communi- among industries, with many of the old-line cations, utilities, trade, finance, insurance, real factory jobs giving way to new industries and estate, government, and “other services”), occupations. Factory automation and office which BLS expects to account for 75 percent automation will displace some workers but of all new jobs, or 18.7 million by 1995. Since they will have an opportunity to move into these industries are the ones in which office other jobs; what new industries and occupa- automation could have major effects, the BLS tions will be created is not specified. reasoning should be examined closely. BLS expects that jobs requiring college or BLS expects that a quarter of all employ- specialized technical training will increase sig- ment growth, 31 million jobs, through 1995 nificantly, as will some less skilled jobs; for will be in the category of “other services. example, nursing aides and orderlies. The BLS Within this category the largest industry is analysts recognize that ‘‘employment growth business services, which includes a variety of in many occupations will be affected by tech- things from business consultants to janitorial nological change . . . “ and that among these services, and is projected to grow by 5.3 per- are typists. Nevertheless, they expect many cent per year, with employment growth of 3.9 office occupations to grow, as shown in table percent per year. Professional services (legal, 2-1. engineering, accounting, etc. ) are expected to BLS projections show three alternative add another 850,000 jobs. Financial and bank- growth rates, which are based on alternative ing services are projected to have strong assumptions about the overall rate of economic growth but “modest” gains of employment growth. The BLS employment projection proc- of 1.9 percent per year or 21 percent increase ess links a labor force model, an aggregate mac- in 10 years. roeconomic model, an industry activity model, The BLS projection assumes: 1) full recov- a labor demand model, and an occupational ery from the 1982 recession and stable eco- demand model. Under different assumptions nomic growth through 1995, 2) continuing de-

‘George T. Silt’ estri, tJohn hl. I.ukasiewicz, and Marcus E. ‘Nlanufacturing employment. which has declined from 25 E:instein, “Occupational Employment Projections Through percent of all jobs in 1959 to under 19 percent, is projected 1995, ” Emplo~rment Rejections for 199,5, U.S. Department of to hold this share through 199,5. This means that manufactur- [.abor, Rureau of I,abor Statistics, Bulletin 219’7, March 1984, ing would have to create about 4,3 million additional j ohs, or p. 44. one-sixth of all new jobs. 38 ● Automation of America’s Offices —

Table 2-1.– Growth in Selected Occupations as Projected by the Bureau of Labor Statistics, 1982-95

Projected growtha Range of jobs addedb Occupations Low Moderate High (thousands) Total : all occupations ...... 23°/0 250/o 28% 23,336-28,392 Total: professional, technical, managerial, and clerical ...... 26 28 31 11,921-14,165 All professional, technical, and related occupations ...... 30 31 35 4,961-5,741 Accountants, auditors ...... 38 40 44 325-373 Computer specialists ...... 79 81 84 414-439 Economists ...... 29 27 30 9-9 Managers, officials, and proprietors ...... 26 28 31 2,476-2,935 All clerical workers ...... 24 26 29 4,484-5,489 File clerks ...... O 2 5 21-34 General clerks ...... 7 9 12 642-765 Office machine operators ...... 26 28 30 243-284 Computer operator personnel ...... 25 27 30 147-172 Data entry operators ...... –12 –11 –9 –38-–28 Secretaries, stenographers ...... 24 26 29 644-787 Typists ...... 15 16 19 146-185 Telephone operators...... 6 8 10 19-31 aprojectlons were made for IOW, moderate, and high occupational growth scenanos with associated variation by industry bThe range represents the low tO high estimates SOURCE GeorgeT Sllvestri, JohnM Lukas!ewlcz, and MarcusE Einstein, “OccupatlonalE mployment Projections Through 1995;’ Ernp/oymen/ Pro)ecfions for 1995, US Department of LaboC Bureau of Labor Statistics, Bulletln 2197, March 1984, p 44 about economic growth, industry sectors grow clerks declined by l.2 percent but 27 to 33per- at differentiates. If an industry is expected cent growth is projected. to grow, occupations concentrated in that in- This mechanical linking of occupational dustry are projected to grow proportionately, growth to industry growth suggests that BLS with marginal adjustments made to accom- may underestimate the effect of technologi- modate anticipated technological changes. The cal change (and office automation in particu- tying of occupational growth to growth in spe- lar) even though the text accompanying its cific industries accounts for some curious out- projection acknowledges that: comes to be noted in table 2-1, which is abstracted from much larger tables in the BLS Most office clerical occupations are expected projection. For example, demand for econo- to grow more slowly during 1982-95 than in mists increases less under the moderate growth the 1970s because of office automation. . . scenario than under either the low or high Secretaries will increasingly use advanced of- growth scenarios, presumably because econo- fice equipment in the future, thereby becom- mists are concentrated in industries that would ing more productive. This in turn will dampen demand for the occupation. Nevertheless, see- expand least in a period of moderate economic retaries are projected to grow at a rate that growth. is about average because of the growth of in- 5 Some occupations that declined from 1979 dustries in which they are concentrated. to 1982 are nevertheless projected to grow in Anticipated growth in demand for goods and the future, because the decline is attributed services, generated through the BLS macro- to the business recession and it is assumed economic model, is translated into a projec- that with recovery, past trends in occupational tion of industry activity (e.g., growth rates) growth will be resumed. The model does not through the use of input/output analysis. As separate change due to business cycles from a commentary on the BLS methodology notes: technological change. For example, drafters decreased by l.6 percent from 1979 to1982, (Input/output modeling) . . . assumes, for ex- but are projected to increase from 2 to 8 per- ample, fixed coefficient production; that is, cent. Cost estimators declined 2 percent but growth of 41 to 48 percent is projected. Book- ‘Silvestri, Lukasiewicz, and Einstein, op. cit., p. 44. “John A. Hansen, Bureau of Labor Statistics Methodolo~, keepers (hand) declined by 3.9 percent but 13 for Occupational Forecasts, a contractor report for the Office to 18 percent growth is projected. General of Technology Assessment, April 1984. p. 13. Ch. 2—Productivity and Employment ● 39

that there is a single production process that However, the rationale for making these ad- must be used in the production of each good. justments, and the precise changes that are No substitutions are permitted between the made, are difficult for outsiders to track and various inputs to the production process . . . examine. 7 BLS is, however, notably conserva- (U)nless a new input/output table is constructed tive in making such adjustments, relying heav- for each time period, technological change can- ily on past trends. not be incorporated into analyses based on input/output tables. The use of input) output In a recent General Accounting Office (GAO) tables therefore naturally makes it difficult publication,R BLS stated its assumptions for to incorporate technological change into oc- some “growth occupations. They were very cupational forecasting. simple, brief, and generalized. For example, BLS analysts are acutely aware of this prob- for accountants and auditors, the only tech- lem. Adjustments to take into account technological assumption was: nological change are made at several points It was assumed that there will be no tech- in the BLS process. Technological change will nological changes or developments that will effect the forecast output of the economy as affect employment in this occupation. a whole, and the allocation of final demand into the 156 categories used in the model. A For bookkeepers (hand), the relevant assump- technological development that affected the tions were as follows: distribution of demand for transport of freight Computerization has had a significant effect between the trucking and air transport indus- on employment in this occupation by slowing tries would require changing coefficients at down the rate of growth. This trend will con- many points in the model, for example, those tinue, causing the employment of bookkeepers governing the relationships between demand to grow more slowly than average. for transportation, energy, and perhaps steel Computerization will continue to develop, and rubber. but its adverse effect will be offset by the rapid increase in the volume of business. Industry outputs must then be translated Computerization will continue to spread be- into demand for labor—and number of jobs. tween 1982 and 1995. There will be further The econometric model that does this is based evolution of labor-saving technologies and con- on a constant elasticity of substitution pro- tinued diffusion throughout the economy, reduction function, that is, a basic formula that sulting in higher productivity and a slower- interprets the substitutability of one input for another, for example, capital for labor. It includes a technology variable that governs the Ibid., See also ‘1’imothy I,. I lunt and H, Allen Ilunt. of the total output-to-capital ratio for the economy W’.PJ. Upjohn Institute for l;mplq’ment Research. “.$n :\ssessment of Data Sources to Stud}’ the F; mplo~. merit l’; ffects of as a whole. This variable is given a different Technological Change, a paper submitted to the National A cad- weight for each industry. When the output- em~” of Sciences Committee on Wrornen Flmplol’ment and Re- to-capital ratio is changing significantly (as lated Social 1 ssues, october 1984. They comment: Technological change actual]> enters into the (f31.S) sy<(tln) in it has been in office-oriented industries) this at least three plactls [rl’)t’cl]nolo~ical” change will ha~e speclflc weight must obviously be adjusted. Some ad- effects on some occupations. it will ha~re an overall impact on t hr product i~it} of workers, and it will affect the demand for good\ justments are also made in translating labor anci ser~]ces generally demand into number of jobs, to accommodate I t IS worthy of note th~it t h]s system in~ {)l~,t~s a con>ld[,rat)l~, amount of judgment, cspeclall~’ in anticipating the effects of t ec~v trends in length of workweek and work year. rmlogxal change. There are no sm~ple equations that pr(’diet changt~< in staffing pat tt,rns w’ it hin an lndustr}. I n fa{t, t he 111 ,S ~t tiff }~;]~ Such adjustments are made, in the BLS profound that trends ]n industr} ~ln~plo~n]{,nt It’1 (,1~ (’an I)(I pr(dict<)(i more accuratel~’ than the changes in occup; it ion.il (In)pl(J~ mt, nt cedures, by the analysts using their own knowl- This 1~ due in large part to the difficult} of pro it[t]ng spwiflc (N- edge of and assumptions about current and cupat ional impacts of tec.hnolo~i[al chan~~, anticipated technological developments. They ‘~l,s, ( ;~~ncral :~~c~unt~ng office, specific 7’ec.hnolo@(>:d ..\.s- sumptions A fftwtin~~ the l{ureau of I.abor Statistics 1995 b;m - are, in other words, made on the basis of judg- pio~’ment l’roje(tions, Report tot he Hon. Flerkle~’ Mdell, (1, S. ment and can only be evaluated in that light. Ilouse of Represent ati\’es, (;, A() OCE-85-2, hla~ 20, 1985. 4~ Automation of America’s offices — . than-average rate of growth for this occu- also used input-output analysis. To deal with pation, the problem of incorporating the effects of The occupational forecast is made by disag- technological change into the model, however, gregating the labor demand further; that is, Leontief and Duchin allowed the coefficients the 156 industry sectors used in the other in the matrix to change over time, adjusting models is spread apart into 360 industries and these coefficients on the basis of qualitative the total number of jobs is allocated between judgments. them. For each of the 360 industries, BLS con- Four scenarios were developed. Scenario 1 siders the historical staffing pattern—obtained assumed no further automation or any other from the Occupational Employment Survey technological change after 1980; it is clearly and carried out by State Departments of Em- a highly unlikely scenario and is used as a refer- g ployment Security. The jobs that it is assumed ence or benchmark for the others. Scenarios the industry will provide are distributed among 2 and 3 project an increasing use of computers the occupations according to the ratios that in all sectors for specific information process- have been obtained in the past, with some ing and machine control tasks and their in- qualitative adjustment. In preparing the oc- tegration. Of these two, Scenario 3 assumes cupational projections for 1995, the BLS pro- faster technological progress and more rapid cedure assumes that all workers will be in oc- adoption of available technologies, including cupations that not only exist now, but have more powerful software. Scenario 4 is identi- existed long enough that employers begin list- cal to Scenario 3 except that it uses different 10 ing them as separate categories. final demand assumptions. The study con- BLS uses several kinds of sensitivity anal- cluded that the intensive use of automation: yses in preparing its forecasts; the analysts . . . will make it possible to achieve over the lay out three different scenarios or trend lines next 20 years significant economies in labor for economic growth, and also make varying relative to the production of the same bills of assumptions about labor productivity. These, goods with the mix of technologies currently however, would not capture fundamental in use. Over 11 million fewer workers are re- changes in production processes and capital- quired in 1990 and over 20 million fewer in to-output ratios. No sensitivity analyses are 2000, under Scenario 3 as compared to Sce- performed to test the effect on staffing pat- nario 1: this represents a saving of 8.5 percent and 11.7 percent respectively of the refer- terns of technological change. 12 ence scenario labor requirements. (Emphasis In summary, the strong link in BLS fore- added. ) cast methodology between industry growth The differences by 1990 between Scenario and projected occupational growth, together 1 (no further automation) and Scenario 3 for with reliance on traditional industry staffing major categories of workers are: 13 patterns and occupational distributions, tends to greatly underestimate the effects of fun- ● 5.5 percent more professionals, damental technological change. This forecast ● 13.9 percent fewer managers, cannot be assumed to capture reliably the po- 32.4 percent fewer clerical workers, and tential effects of office automation. ● 8.4 percent fewer jobs in all categories in the national economy. The Leontief-Duchin Forecast, “The Impacts of Automation on Employment, 1963-2000,’’” —.—.—— .— ‘The survey covers 500,000 businesses, one-third of which ‘I,eontief and Duchin, op. cit., p. 1.15. There is a slight dis- are covered each year, and 1,500 occupations found within those crepancy between the percentages given in the authors’ text businesses, quoted here and those given below and computed from their “Hansen, op. cit., p. 18. tables (p. 1.16 of the report cited); the difference is minor and “Prepared by the Institute for Economic Analysis, New perhaps was caused by rounding errors. York University, for the National Science Foundation, April “This includes all private sector employment plus public 1984, Wassily I.eontief and Faye Duchin, Principal Investi- education and health, but does not include public administra- fzators. tion, the armed forces, or household employees. Ch. 2—Productivity and Employment ● 41

By 2000, the changes are greater: logical assumptions. Growth in demand was progressively reduced until the labor force ● 21.5 percent more professionals, needed fell within the range of the projected 41 percent fewer managers, labor force available for the years 1990 and 45 percent fewer clerical workers, and 2000, This scenario does not correct the de- ● 11.4 percent fewer jobs in all categories fect of ignoring imports; all demand is again in the national economy. assumed to be supplied by domestic labor. Note, however, that “fewer” here means only fewer than there would be without any fur- This required a reduction of their projected ther automation—not fewer workers than there output demand of 4.4 percent for 1990 and are now. As compared to the real figures in 17.8 percent in 2000, Because overall economic 1978 (the base year), total employment will activity is lower in Scenario 4, capital invest- grow by 49 percent under Scenario 3 as comment is also lower, and the number of jobs pared to 53 percent growth under Scenario l— related to production of capital goods falls, no further automation. By 2000, it will increase especially craftsmen’s jobs. The occupational 76 percent over 1978 employment in Scenario composition of the work force otherwise re- 3, as compared to 98 percent increase in Sce- mains much the same. The percentage reduc- nario 1. tion in demand for labor is, however, greater than the reduction in final demand. Under Scenario 3, the proportion of professional jobs to all jobs rises from 15.6 percent Scenario 4 therefore represents an estimate in 1978 to 19.8 percent in 2000; managers’ jobs of the extent to which real per capita consump- decline from 9.5 to 7.2 percent, and clerical tion can increase if the entire projected labor jobs from 17.8 to 11.4 percent. Sales workers force is employed, using computer-based tech- decline slightly relative to total employment, nologies, and demand is met by domestic pro- while the proportion of craftsmen, operatives, duction. It is important to note that the service workers, laborers, and farmers each in- Leontief-Duchin team did not generate its own creases. The increases in professional jobs, un- projection of consumption (final demand, or der Scenario 3, are mainly in demand for com- delivery of goods and services), but used that puter specialists and engineers. generated by BLS for its moderate growth scenario, discussed above. The good news in the Leontief-Duchin forecast is that if their projections were correct, Leontief and Duchin, as noted, incorporated the labor requirements for Scenario 3, in 2000, the potential effects of technology into their would exceed the projected available labor forecast by changing the input-output coeffi- force of 157.4 million (after allowance is made cients over time. These changes are exogenous for public administration, household workers, to the model; the direction and magnitude of and some multiple job holders). This means, the changes were arrived at by the team of however, that the rate of growth in final de- analysts on the basis of extensive review of mand that they assumed could not be achieved research results and scholarly and trade liter- without still greater technological change. ature, and their assumptions are set out within their project report. The factors explicitly This problem reveals a serious weakness in taken into consideration were estimates of the the model; it ignores the importing of both rate and extent of capital investment, the capital goods and services. Since imports are amount of time in 1977 that a worker spends a major, and growing factor in the economy, performing particular tasks, the amount of the Leontief-Duchin model does not reflect eco- automatic equipment that will be applied to nomic reality. those tasks, the amount of time that can be Leontief and Duchin developed a fourth sce- saved per task by using automated equipment, nario to assess the growth in demand that the percent of workers in particular occupa- could actually be attained under their techno- tions and industry sectors that will use the 42 ● Automation of America's offices new technology in a given year, and the possi- an assumption that it will do so. The model ble increase in demand for certain office occu- formulated by Leontief and Duchin is dynamic pations (i.e., the effects of increased demand in that investment is a function of changes for information-handling). Coefficients were in output in industry sectors. They project sig- modified accordingly; for example, in Scenario nificant gains in employment in most sectors 3, the labor coefficient for “stenographers, because the model projects nearly unlimited typists, and secretaries” for 1990 was set at increases in the production of capital goods 0.65 of the 1977 coefficient, and for 2000 it (output). But the model ignores the strong was set at 0.45 of the 1977 coefficient, mean- trend toward import of capital goods (and of ing that for a given unit of work done by these services); in reality, the income generated by workers in 1977, only 65 percent as much la- production of capital goods outside of this bor will be needed in 1990 and only 45 percent country does not directly translate into in- as much by the year 2000. To look more closely creased consumer demand within this coun- at the narrower category “secretaries,” the try and can translate instead into a loss of em- team assumed that by the year ‘2000 in com- ployment. parison to 1977: Leontief and Duchin, recognizing this un- ● 30 percent of secretaries will not be af- certainty, conclude that “it is not yet possi- fected by word processing, ble to pass a final verdict on the question of ● 20 percent of a secretary’s time is spent technological unemployment by the year 2000. ” in tasks not affected by word processing, Another reason is, as they acknowledge, that ● word processing saves 80 percent of the to do so they would have to incorporate into time required for conventional typing, their forecast other kinds of technological ● 35 percent of secretaries are also affected change, which will change the nature and level by other office technologies, of final demand for goods and services. ● 45 percent of their time is affected by Leontief and Duchin also postulate on the other office technologies, and basis of their model that “labor requirements ● 75 percent of secretaries’ time is saved to satisfy a continually but moderately increas- by new technology relative to old tech- ing standard of living will number 124 million nology. jobs in 1990 with the required occupational While other analysts may quarrel with one composition reflecting the technologies that or all of these estimates or assumptions, and will be in place . . . but because of very slow may question whether they have foreseen change in the orientation of education, train- likely technological breakthroughs, their as- ing, guidance, and so on, these individuals’ sumptions in general do not appear to be overly skills and occupational expectations will re- conservative. There is no obviously better way flect the mix of jobs that corresponded to the available as yet to arrive at such estimates technologies that were in place in 1978 . . . “ than the one the project used–expert judg- Under those conditions, they point out, 744,000 ment. The far larger problem has to do with managers and over 5 million clerical workers the assumptions about future economic growth. could be potentially unemployed while there would be about the same number of unfilled This brings one back to a broader version jobs in other occupational categories, for which of the question proposed at the beginning of they lacked the necessary skills. The problem this chapter: will the demand for information for public policy, in other words, could be very (which is to a large extent a function of the serious even if demand for labor is equal to level of economic activity in this country) really or greater than the supply. grow to an extent that it will more than balance the labor-saving effects of information A major difficulty with this forecast is doubt technology? Both the BLS and Leontief-Duch- about the assumption of great and increasing in forecasts of employment growth depend on demand for information-handling, which is ulti- Ch. 2—Productivity and Employment ● 43 — mately derived from the assumption of stead- then used the technological assumptions to ily increasing production of capital goods. estimate the reduction in clerical time needed to perform specific functions in 1985, 1990, A Georgia Institute of Technology Forecast 1995, and 2000. Tying these estimates to 1980 prepared for the U.S. Department of Labor14 clerical employment, an analytical model cal- dealt with clerical employment in the bank- culated the changes in the task/function work ing and insurance industries only. It concluded distribution over the period 1985-2000 for spe- that by the year 2000 there would be an abso- cific clusters of clerical jobs in each industry. lute reduction in clerical employment of 22 per- For sensitivity analysis and validation, the recent (over 1980 levels) in the insurance indus- sults generated by the model were compared try and 10 percent in the banking industry, with those generated by the industry Delphi which together employed in 1980 more than to determine the sensitivity of results to differ- 20 percent of all clerical workers (the clerical ent estimates of the extent to which and ra- employees in these two industries alone con- pidity with which specific technological changes stitute nearly 4 percent of the entire U.S. work will affect particular clerical functions. force). The Georgia Tech team concluded that break- The Georgia Tech research began from the through technologies have the potential to dis- premise that there are “weaknesses in tech- place or otherwise reshape clerical employment niques used to incorporate technological change 5 in at least two functional areas-data input in employment forecasts, ‘* including the un- and data processing. These include technol- systematic and qualitative consideration of ogies such as optical scan, speech recognition, emerging technological capabilities, the use software languages and programs, and artifi- of existing occupational descriptions based on cial intelligence, most of which the OTA As- fixed technologies, the inability to generate sessment also identifies as critical elements estimates of how particular technologies change in the employment outlook. the amount of time spent on basic tasks, and the use of an overly short time horizon (usu- There were several strengths in the Geor- ally 10 years). gia Tech approach which lent credibility to the results. First, it went beyond conventional oc- The study began with a technological fore- cupational categories to consider what it is cast of office automation hardware and soft- that clerical workers actually do, in these two ware, organized in terms of information proc- industries, in their daily and hourly work. Sec- essing functions (descriptions of the content ondly, it attempted to estimate the relative of tasks related to information processing in amounts of time spent in these tasks, and to the two industries). The forecast was designed relate this to the time-saving potential of to identify breakthrough technologies that existing and emerging office technologies. Third- would have major consequences for clerical em- ly, it considered a number of potential or- ployment. Industry officials participated in a ganizational adjustments to the changing na- Delphi (a forecasting technique that generates ture of the tasks in terms of organizational by consensus opinion quantified estimates of structural patterns. Finally, this approach per- specific variables). This produced assumptions mitted examination of future clerical work at about different paths that penetration of of- several disaggregate levels, e.g., functions, fice automation technology might take in each tasks, and job clusters, rather than in terms industry and the different employment/occupa- of formal occupational categories. tional mixes that might result. The analysts There are also a number of weaknesses in

Georgia Institute of l’echnolo~r, Impact of office A uto- the approach. The analytical model lacked feed- mation orI office II “orkers, final repor~, April 1984, prepared back loops–for example, it did not account for the ~~mplo~’ment and Training .4dministration, U.S. Depart- for the way in which the level of clerical em- ment of I.abor; J. I)avid Roessner, Project Director. (;eorgia Institute of Technolog~, op. cit., Iol. 1 I, Techni- ployment affects the number of clerical super- cal Report p. 2. visors needed, and did not account for rela- 44 ● Automation of America Offices tionships between clerical and nonclerical an expectation of smooth technological evo- work. It did not consider creation of entirely lution) but is narrowly limited to two in- new jobs and had little to say about the con- dustries. version of professional work to clerical tasks. Agreement or disagreement with these fore- It did not consider the possibility of signifi- casts does not turn primarily on the models cant restructuring of the industries them- and methodology used, but on the complex selves, and their products and services. More assumptions, estimates, and judgment that importantly, the forecast does not explicitly generated the numbers fed into those models. deal with growth in workload, except through All such models address the question of “what very broadly stated, arbitrary macroeconomic will happen if. . .”; if for example, technology assumptions, i.e., growth within the two in- changes in certain ways, is adopted at certain dustries of about 3 percent annually.” There expected rates, produces in practice the prod- was not explicit consideration of expansion of uctivity benefits that in theory should result, the role of information within the two indus- and leads to the changes in organizational be- tries, which are of course already highly infor- havior that can be rationally anticipated. mation intensive. In spite of the fact that vendors and adver- Finally, the methodology used depends on tisers are often accused of overstating the ben- judgmental data—estimates by industry ex- efits to be gained by automation, forecasts perts and team analysts-even though it is such as these may underestimate them. Tech- treated quantitatively. In this of course, all nology and employment forecasts often mis- employment forecasts are alike insofar as they fire in this way, for two reasons. First, fore- go beyond mechanical extrapolation of time- casters have no reliable way of estimating how series data. To do otherwise would defeat the pervasive a technological change will be–the purpose of anticipating change brought about ultimate rate of penetration. Some technol- by technological or economic trends. ogies are likely to be widely adopted only in All of the above forecasts thus are highly a few industry sectors or in certain parts of dependent on the assumptions made about the a given industry, or only by organizations in increasing volume of information handling (in- a certain size range. Other technologies affect dependently of the credibility of the models a broad range of economic and social sectors used) and the continuation of long established or become so pervasive that they fundamen- trends in the growth of occupations and their tally change social and economic activities— association with specific industries. The BLS for example, the internal combustion engine projection anticipates increases in office em- and electric communications (the telephone ployment in the neighborhood of 25 percent and telegraph). Office automation, in particu- over the next decade but is probably much too lar, computers, are in the latter and more fun- conservative in its attention to technological damental category of technology; and likely change. The Leontief-Duchin forecast points to become as pervasive in office activities as to continued growth, although highly con- the telephone and the typewriter have become strained by the effects of automation, but in the last few decades. bases this forecast on flawed economic assump- Secondly, technology forecasts often go wrong tions. The Georgia Tech forecast, which points either because they assume technological or to a decline at least in clerical employment, scientific breakthroughs that fail to come gives more attention to likely technological about, or because they assume a smooth evolu- breakthroughs (in this field more credible than tionary development of technology rather than breakthroughs that suddenly occur. In com- “The most important of these were (op. cit., p. 18): 1) puter technology, the latter mistake is more periods of growth and recession, but no major depression; 2) common. Recent employment forecasts appear modest overall economic growth averaging 3 percent annually; and 3) growth in insurance and banking industries paralleling to assume that computer-based technologies growth in the general economy. of the next 5 to 15 years will not be signifi- Ch. 2—Productivity and Employment ● 45 cantly better than or different from today ’s. suggesting that there are impending techno- On the contrary, there is no reason to believe logical developments that will have a particu- that their rapid development has come to an larly significant effect on some large catego- end. For example, input technologies, specifi- ries of office employment; that adoption of cally optical character recognition and speech office automation will proceed at an increas- recognition, are likely to have a significant im- ing rate and be much more widespread than pact within 15 to 20 years. The rapid develop- most other kinds of technological change have ment and spread of end-use computing was been; that productivity gains have been and not anticipated in many technology forecasts will be for a few years masked by transition of the 1960s and early 1970s. In the field of problems but will soon become apparent; that microelectronics, it appears safer to anticipate economic growth rates could be lower than quantum leaps in capability than to ignore the they have been for most of our history; and probability of their occurring. that competitive pressures will lead organizations to take full advantage of the labor-saving The chief value in these and other such fore- characteristics of the technology. These con- casts is that they force attention to the many clusions, like those of the forecasts described and complex uncertainties that will affect fu- above, are certainly arguable but merit pru- ture levels of white-collar employment. OTA’s dent consideration. analysis differs from those above primarily in

PRODUCTIVITY AND THE NATURE OF WHITE-COLLAR WORK

Productivity is defined in economic terms decisions, staff support, and policy formu- as a ratio between quantity of output and quan- lation. tity of input; increased productivity is achieved by producing the same amount of product or If the final output of the organization’s activ- service with fewer resources (technological ity is an information product or service (an change), or producing more product or serv- advertisement, a document or research report, ice with the same resources (resource reallo- a legal brief, an advisory memorandum or set cation). Sometimes organizations automate of guidelines), then the number of units proc- their office work in order to do the same essed per hour is often less important than amount of work with less labor cost (which the quality, the timeliness, the fit to a client could mean either fewer workers, or the same needs, or the degree of customer satisfaction. number of workers doing less skilled work for Effectiveness is more important than effi- lower pay). Sometimes organizations foresee ciency. But effectiveness is much more diffi- or seek an expanding workload and hope to cult to measure, since it refers to the charac- accomplish it without increasing their work teristics of the output rather than to a ratio force (or their total expenditure for labor). between countable units of input and output. Applied to white-collar work, however, the concept of productivity becomes complicated If the organization’s final product is a ma- and troublesome. It is least complicated in the terial good such as automobiles, the contribu- context of routine processing of large amounts tion of office work to overall productivity is of standardized, easily quantified data—num- difficult to determine because much of it is ber of units sold, dollars paid or received, ticket concerned with the coordination of intermedi- stubs returned, keystrokes made. It is most ate steps in the conversion of resources into complicated when applied to work where qual- products. Both effectiveness and efficiency are ity is more important than quantity-analysis, important and impossible to separate. 46 . Automation of America’s offices —

There are other general problems in discuss- It is therefore difficult to measure, to de- ing the productivity of service industries. Serv- fine, and even to discuss the amount of in- ice outputs are different from material prod- creased productivity that could be gained by ucts. They can usually not be stockpiled. office automation even if it is widely adopted Customer behavior intrinsically affects the de- by organizations of all kinds and all sizes. Some livery mechanism. For example, a study of in- organizations have been slow to adopt office creased productivity in British accounting automation for this reason. firms found that most of the productivity gains However, an organization will usually not came not so much from anything the accoun- decide to automate a specific task or set of tants did but rather from the clients’ com- tasks if it expects that over the long run the puterization of their own accounts, which al- task will therefore require more labor, or will lowed the accountant to save vast numbers 17 take longer to perform per unit of workload of person-hours in auditing. than without automation. Automation usually In fact, the concepts of “input” and “out- implies some transference of work from hu- put” both become blurred in many kinds of mans to machines, and thus a substitution of whitecollar work. “Hours logged in” or “hours capital for labor. paid for” are often not the same as “hours worked. ” This is true in both blue-collar and If office automation only allowed those orga- white-collar work, but perhaps most obvious nizations that automate (assumed for the pres- for professional and managerial workers who ent to be more efficient) to take over markets may be ‘processing information’ or “formulat- previously served by nonautomating organi- ing decisions’ while they read the newspaper zations, the result would be a reduction in the or fall asleep at night. The quality of work is total amount of labor used. On the other hand, often more important than the quantity of if office automation only stimulated the crea- work for both blue- and white-collar workers, tion and sale of products and services that but for white-collar workers quality is more could not previously be offered—that is, cre- difficult to measure in terms of error rates. ated new markets-the total amount of out- The skill that a receptionist uses in soothing put and labor used would increase. But office irate clients, or that a secretary uses in locat- automation will both create new information ing an elusive file, shows up in the company’s markets and reduce the amount of labor re- records only indirectly as an addition to a quired for existing and new products and services. The difference-net labor demand-could salesperson’s accounts or a lawyer’s clients. Contributions to corporate reputation or em- be either positive or negative. ployee morale are difficult to measure. The factor of time is crucially important. For In terms of outputs, a good decision or the some period of transition, longer for some organizations than for others, there is little or no elimination of erroneous information from a data bank may not be counted, or even be pos- gain in productivity and often some loss. On sible to identify as a discrete output. There the other hand, the new technologies are so is a tendency to use worker activity, an input, powerful that some organizations settle for the as surrogate for an output in measuring pro- short-run labor savings and limited cost re- ductivity, with the unwarranted assumption ductions that are possible from limited use of automated devices, rather than run the risk that more is better. Thus, computers and word processors sometimes lead to a proliferation of temporarily disruptive restructuring of the of reports that may or may not be useful and work to systematically capture all the poten- may or may not represent increased produc- tial benefits. Across the economy as a whole, tivity. with sectors and industries and organizations at all stages of this transition, it is difficult ‘ ‘Irving H. Siegal, Productivity Measurement: An Evolving to anticipate how long this transition will take. Art, Work in America Institute Studies in Productivity, No. Over time–measured in decades–more effi- 16 (New York: 1980). cient organizations should tend to replace less .

Ch. 2—Productivity and Ernp/oyment ● 47 efficient ones, and newly created organizations economy, be automated in the next 15 years? should tend to be automated, and more effi- Will the demand for information processing cient, from the beginning. create more than enough new jobs to compensate for the labor reduction effects of office This is the dynamic shift which needs evalu- automation? ation in terms of the net labor demand. How thoroughly will office work, throughout the

HOW OFFICE AUTOMATION AFFECTS EMPLOYMENT

Office automation can substitute for labor, supplement labor, or reorganize work and there- I by make labor more efficient. It can allow highly technical, knowledge-intensive work to be done by relatively untrained and unskilled, lower paid workers. (Skill enhancing and job enhancing features of the technology are also important, but are discussed elsewhere. ) It can change the characteristics and skills associ- I ated with occupations and alter their role and I relative importance to an industry. It can allow office work to be done away from the office and outside of conventional office hours, even outside of the country. —L Cred/f Communications Workers of A~erlca The most dramatic potential substitution “We ‘ve decided to call it the neutron chip. It eliminates jobs of technology for labor, in the future, could but /eaves the work-p/ace intact”. be the elimination of a large proportion of today’s data-entry work (either numeric or text) Direct substitution for labor is only one pos- interorganizational transfer of data, di- sibility. Automation reduces the time required rectly from computer to computer; for many tasks. The measured time-saving for direct input of data by optical scanning specific tasks, in numerous pilot projects and technologies, and possibly by speech rec- implementation case studies, varies from min- ognition technology; and utes to days. There is no way to validate, com- capture of data at the point of origin, in pare, and aggregate such figures across orga- a variety of ways ranging from bar code nizations. The estimate of “15 percent time readers to consumer use of terminals, e.g., saving” for complex procedures and task clus- bank automated teller machines (ATM s). ters recurs with great frequency in both private and public sector office automation plans, In short, second-time keyboarding of the cost justifications, and cost-benefit studies sur- same data may eventually disappear almost veyed by OTA, but again it is difficult to doc- completely (i.e., once data exists in machine ument or generalize this measure. The most readable form it will be endlessly changeable that can be concluded is that time-saving is and exchangeable). First-time keyboarding real but its magnitude and overall effect on may also be sharply reduced. This may not productivity cannot yet be stated. ’s happen within the next decade, and yet optical scanning technology and computer exchange of data is already reducing data entry ‘App. 13 summarizes se~reral case studies done for this in some areas, and all of these trends could OTA assessment; others from scholarl~ and trade literature develop very quickly. are referenced throughout the report,. 48 Automation of America Offices

Automation also can reduce the time that As the conceptual model described in chap- people have unavoidably spent between pro- ter 1 suggests, even if an organization adopts ductive tasks, or in sequencing tasks. One ex- office automation to reduce unit labor costs ample is the way voice mail and electronic mail in standard tasks, managers will subsequently can reduce the time spent in communicating recognize that it also has other capabilities, by eliminating “telephone tag” or frequent call- and will adapt the workflow or production proc- backs, searching for telephone numbers, and ess to take better advantage of those possibil- getting wrong numbers or busy signals. Elec- ities. This may take considerable time, since tronic filing can eliminate walking to a file cab- problems arising from the initial substitution inet and searching for a particular file; word and from the interface of new technology with processing eliminates cutting and pasting or old procedures usually get first attention. Ini- retyping documents to eliminate errors. tial transaction costs of adapting the production process to new technology are high. Train- In some applications a long series of tasks ing and system support costs in particular that required several workers is combined into often outweigh hardware and software expend- one task. For example, in mail processing, a itures. The risks associated with trying new many-step function that involved several ways to get the work done appear very large clerks (mail openers, sorters, typists) can be and potentially disruptive to many firms. For redesigned to require only a mail opening ma- this reason the full effects on employment are chine and a clerk entering information into a likely to appear only after considerable time computer terminal.19 Professional case work- and experience. ers in a New York City Municipal agency formerly sorted mail from clients and selected Office automation can also complement and and typed one of four form letters in response. augment labor, making new tasks possible. Now lower paid clerical workers call up the Computers made it feasible for insurance com- client file and push one computer key to send panies to move from annual billings to quar- the appropriate form.20 terly or monthly billings (thus encouraging lower wage earners to buy insurance), and the These are examples of process change, or increased availability of information also led reorganization of work and workflow to take States to impose increased reporting require advantage of office automation. Some insur- ments on the industry. In other financial serv- ance companies have been phasing out jobs ice industries, automation allowed the crea- that involve responding by individual letters tion of new consumer services that would not to mail inquiries about claims, policy changes, have been cost-effective otherwise. In large law or policy applications. Policy holders or appli- firms, some evidence suggests that the intro- cants have a toll free number to call. The em- duction of word processing resulted in sup- ployees who answer such calls use terminals port staff employment growing several times to retrieve the information required to answer faster than legal staff.22 Some people suggest most queries. By telephone the employee can that once word processing is substituted for elicit all the necessary information, some of typing, a great deal of “hidden work” ap- which is often absent from mail communica- pears-work that there was no time to get done tion, thus requiring more than one exchange before. This is one aspect that leads to an in- of letters. The cost per inquiry is reported to 21 crease in the demand for information process- be one-third the cost per mail inquiry. ing, and often therefore to a net increase in demand for labor. ——— -- — “’Matthew P. Drennan, “Implications of Computer and Communications Technology for Less Skilled Service Employ- ment Opportunities, ” Final Report to the U.S. Department of “Mary C. Murphree, “Brave New Offices: The Changing I.abor, grant No. USDL 21-36-31, Jan. 21, 1983, p. 2. World of the Legal Secretary, ‘Y ~romen To~ls and Triumphs Wee ch. 10. at the Workplace, Karen Sacks and Dorothy Remy (eds. ) (New ‘Matthew P. Drennan, op. cit., p. 64. 13runswick, NJ: Rutgers University Press, 1984). Ch. 2—Productivity and Employment ● 49

The net effect of other, equally important, changed to one secretary serving three to five effects of office automation on work and work- professionals, or a cluster of support staff flow is even more difficult to assess. Chapter working for a large group of professionals and 4 considers these changes in considerable de- managers. tail. Automation clearly leads to reallocation Office automation may result in a more var- of tasks, for example, professionals and man- ied occupational structure, because of the di- agers drafting their own letters and documents verse choices among applications and because on the word processor. Analytical work that automation allows production process and formerly required specialists with long train- staffing to vary widely with the type of prod- ing can be incorporated in software that can uct. For example, three staffing patterns have be used by people without extensive profes- been observed among insurance carriers.” In sional training. Reason suggests that in the highly automated personal lines underwriting interest of cost-saving organizations will tend departments of large property/casualty car- to professionalize clerical work–i.e., push tasks riers, rating and risk assessment may be com- downward in the hierarchy-and reduce the puterized and the functions formerly divided number of middle-level professionals and man- among many clerks, raters, and underwriting agers rather than the number of clerical work- assistants, may be consolidated and delegated ers, since the former are paid more. This is to highly skilled clericals. Unskilled clerical the argument for the so-called “disappearing work is then largely eliminated. Underwriters middle management or “flattened hierarchy’ become “exceptions handlers, ” doing more phenomenon that some experts anticipate.23 complex work, and their work may shift to The “clericalization of professional work” planning and marketing. Skilled clericals be- appeals to many professionals, because it gives come the bulk of the work force. In other them more autonomy and more control over insurance firms, where products are standard- the quality and pacing of their work; they can ized and high volume, almost all of the semi- alter and revise as they go, they need not queue skilled tasks are computerized and a bipolar up or compete with others for the typists’ time. work force is created, with a large number of There is some evidence from case studies and routine-data entry clerks and a few highly general observation that the ratio of support skilled, professional exceptions handlers. In staff to professional staff is tending to decrease still other cases where product lines are low in many offices—that is, the pattern of one in volume, specialized or complex, there is secretary to one boss has already commonly likely to be less extensive, more discrete automation. Data entry will be done by operators hlan~’ office automation experts and industry planners ex- using dumb terminals, and underwriters re- pect that \arious computer applications will allow managers to extend their scope of supervision and planning, and will view all policy. thereb~. allow organizations to reduce the number of super\’ i- sory managers required, and flatten the management hierar- Thus, a view of office automation’s effects ch~’. This thesis has sometimes been addressed, in popular litera- on employment must take into account not ture, in terms of a related issue, that of the “disappearing only substitution of capital equipment for la- middle (income class ).” Saskia Sassen-Koob and others have put forward an argument that there is, or will be, a growth bor in specific tasks, and the expansion of in emplo~’ment in both high- and low-income categories in the workload, but many additional and interven- fastest g-rowing industries {ad\’ anced ser~’ices), with a decline ing variables including (see figure 2-2) recom- in middle-income categories, and thus income polarization. See Saskia Sassen-Koob, “The New I.abor Demand in I.ocal Cit- bination of tasks, reassignment of tasks ies, ” Cities in Transformation, Michael Smith (cd. ) (E3e\erly across jobs and occupations, changing skills Hills, CA: Sage Publications, 1984), pp. 137-171. The income statistics put forward by Sassen-Koob as e~’idence that the ‘ ‘disappearing middle’ is occurring are effecti~’el~’ challenged b?’ -’Barbara Baran, ‘“Technology Innovation and Deregula- Neal Ii. Rosenthal, ‘ ‘The Shrinking hliddle Class: hlyth or Re- tion: The Transformation of the Labor Process in the Insur- alit~’?’ Alonthl~’ I.abor I/e\’iew, Nlarch 1985, pp. 3-10, How- ance Industry, ” Berkeley Roundtable on International Econ- ever the possibilit~~ of a reduced management hierarch~r need omy, contract No. 433-3610.0, prepared for Technology and not stand or fall on the terms of this controy’ersjr at the macroe- ~~conomic Transition Project, Office of Technology Assessment, conomic le}el, Januar~ 1985. 50 “ Automation of America offices .-

Figure 2“2.—Framework for Analyzing Long”Range Effects of Office Automation on White”Collar Employment

Iemployment and unemployment Ievelsl

SOURCE Office of Technology Assessment requirements and corresponding job defini- is potentially most appropriate for incorpora- tions, changes in the definition of occupations, tion into an expert system (a special software and shifts in the number of jobs per occupa- for decisionmaking) while broad, general knowl- tion. The way in which these changes occur edge is difficult to incorporate.25 is further discussed in chapter 4. When word processing is introduced, assuming that the workload does not increase, fewer Emerging Occupational Shifts dedicated typists (keyboarders) will be needed. A general secretary who spends only a part Other things being equal, the introduction of her time typing, is not likely to be displaced of labor-saving technology is most likely to by a word processor; more likely she will have cause displacement where the task that is auto more time for other responsibilities and may mated has constituted all, or nearly all, of the take on new ones. Secretarial positions have responsibilities of a given job. In other words, been increasing throughout the two decades the more narrow and specialized the job, the more likely the job-holder is to be displaced of office automation, while “typist” jobs are decreasing. by automation. This applies, at least potentially, to professional specialists as well as to clerical workers. Highly specialized knowledge -“Science, “Artificial Experts, ” Mar. 23, 1984, p. 1281. Ch. 2—Productivity and Employment ● 51

At the most general level, table 2-2 shows jobs. Personal computers can be used to inte- the relative shares of major occupational cat- grate tasks and broaden jobs. Moreover, orga- egories in the economy. Clerical workers are nizations that rationalized work during their the largest employment category, followed early office automation are in some cases using closely by professional and technical.26 further automation to reverse that process. Many firms have decided that computer and In the first stage of automation (large com- communication technologies are often most ef- puters), the tendency was to make affected jobs fective in reducing costs when control, com- more narrowly defined—in other words, to ra- munication, and decisionmaking are decen- tionalize work. Batch data processors did not tralized and when hierarchic organization and learn or do other work. Word processors were functional specialization of tasks are reduced. set apart in word processing centers. New spe- They are experimenting with the elimination cialties were created, ranging from computer of both low-skill clerical jobs and routine tech- operators to programmers, and the holders of nical/professional jobs, and with the creation those jobs typically did nothing else. If data- 27 of new multiactivity, skilled clerical positions. entry work is completely automated (e.g., by In some insurance firms, the result of task rein- optical scanning technology) those who do only tegration has been a significant reduction in data entry are most likely to be displaced and unit labor requirements and an increase in the secretaries are unlikely to be displaced by that average skill levels of the remaining clerical, development. 28 sales, and professional work force. As discussed in chapter 4, second phase It is important to note that reduction of unit automation—end-user computing—appears labor requirements has been achieved in both less likely to rationalize tasks or to narrow — — work rationalization and work integration, ‘ A major problem in assessing occupational change is a set with office automation being used for both, of difficulties and deficiencies encountered in working with occupational data as it is now collected and aggregated. Occupa- The networking of computers is likely to tional data are deri~ed from sur~’eys, and the more specific and eliminate some jobs that have until now pro- narrow the occupational category used, ~he smaller the sur~’e~ sample is, and therefore the less reliable the estimate of the vided the link between automated tasks—for total. A more important problem is the lack of consistent time- example, those concerned with reorganizing series data because of frequent changes in occupational classifications, especially between the 1970 and 1980 censuses. hluch of the data used in this chapter is drawn from the occupational -“In the insurance industry, management first tended to fol- industry employment matrix prepared by the Bureau of I.abor low the logic of scientific factory management, rationalizing Statistics from occupational ~~mployment Surve~’ data, modi- and fragmenting tasks. Some insurance firms are now using fied by 131.S use of a statistical model. Both the survey and integrated systems to reintegrate tasks, iillowing one person the model have some methodological problems; for example, to handle multiple service transactions so that the individual there are \“ariations o}’er time in the way that sur~’ey data was master record for each policy is a complete database. collected, and matrix data for 1980 and 1982 are not fully com- -“Eileen Appelbaum, “Technolog~ and the Redesign of parable. For more information on emplo~ment statistics con- M’ork in the Insurance Industr~’, ” Stanford Uni\’ersitJ’, I nsti- sult the 111.S Iiandbook of Afethods, vol. 1, Bulletin 2134-1, tute for Research on Educational Finance and Go\’ernance, December 1982. Project Report No. 84-A22, No\rember 1984, p, 10,

Table 2-2.– Percent of Total Work Force in Occupational Groups by Selected Industry Sectors, 1982

Industry Sector All All Health Occupations industry manufacture ng Firea Services TCUb services Trade Professional, technical, and related occupations ...... 16.39°\0 10.270/o 9.46°\o 33.65 0/0 7,86 0/, 34.47 0/0 3,78 Managers. officials, and proprietors ...... 8.37 6.69 17.06 6.82 8.99 4.38 9.34 Clerical ...... 20,36 11,75 63,40 19,11 33.29 17,02 20.68 Total ...... 45,12 28.71 89.92 59.58 50.14 55.87 33.80 a FIRE F!nanclal Insurance real estate bTCU Transportation commuqlcatlons ut(lltles SOURCE U S Department of Labor Bureau of Labor Statlstlcs Ernp/oymenf and Earn/ngs, VOI 30, No 1 January 1983 52 Automation of America’s Oftices

or resorting data generated by computers in Professional Occupations one department for entering into another sys- Professionals here are defined as workers tem, or the rekeyboarding that has been nec- doing cognitive tasks that require specialized essary when one organization’s data was passed knowledge gained through lengthy education, on to another. often with a graduate degree, or special cer- Office occupations must be considered in the tification or licensing.29 They make up more context of industries and industrial sectors, than 16 percent of the work force and are found all of which have some component of office in all industry sectors, but there are relatively work. In office-oriented industries such as fi- few in some sectors such as agriculture and nance, insurance, and real estate (FIRE indus- trade, whereas in some service industries tries), a very high proportion of the work force (health services, business services) they make in clerical and professional occupations is likely up more than a third of the work force. Some to be directly affected by office automation. professional categories are generic; lawyers, In other industries, such as machine tools pro- accountants, and computer scientists for ex- duction, a much smaller proportion of the work ample are found in every industry. Others are force is in office occupations, and these tend industry-specific, such as insurance investiga- to be in less specialized jobs (i.e., general sectors, title examiners, and broker’s floor repre- retary). sentatives; or are heavily concentrated—more than 82 percent of financial analysts, for ex- Some occupations are more or less stand- 30 ample, are in the FIRE industries. ard across industries. Typists and payroll clerks do much the same work with only mi- In an information-driven economy, in which nor variations in whatever industry they find services—with high concentrations of pro- themselves. The same is true of many profes- fessionals-is the most rapidly growing sec- sional categories— tax lawyers, auditors, or tor, it is likely that the demand for professional certain types of engineers work for many in- workers will increase. This category has industries that require the same general skills. deed been increasing much more rapidly than Other occupations are characteristically found any other occupational category. Its growth in one industry or a cluster of highly related is not, however, unaffected by office auto- industries. mation. Both generic and industry-specific occupa- Many professionals are not primarily office tions may perform narrowly defined tasks and workers; for example, teachers, medical doc- thus be potentially subject to displacement. tors and laboratory scientists may have or use If office automation is broadly adopted across offices, but the core of their activity is not of- industries for tasks performed by generic oc- fice work and is not directly susceptible to of- cupational groups, then the people who are dis- fice automation. However, it usually requires placed will find it difficult to find similar jobs supporting clerical and administrative work in a different industry. On the other hand, if that will be affected. Professionals may them- industry-specific occupations find their work selves use office automation in peripheral being automated, they may move to smaller tasks, and their professional tasks may be firms or less rapidly automated firms within the same industry—unless those applications ‘<’The term “professional” has undergone a subtle change in meaning in this century: historically, most professionals prac- are insensitive to the size of the firm. ticed their calling on an independent or free-lance basis and in common parlance professionals tended to be distinguished Labor force adjustment to office automation from salaried workers. Now most professionals are probably may require major shifts in employment levels employees of organizations. across occupations. Industry sectors differ in ‘“To some extent, however, this distinction is an artifact of the way jobs are titled in various industries. People with differ- the proportion of workers in major occupa- ent job designations in different industries may still do much tional categories (see table 2-2). the same work, or have much the same training and basic skills. Ch, 2—Productivity and Employment ● 53

automated by other kinds of computer appli- out this decade, and the National Science Foun- cations (e.g., diagnostic technology) beyond dation has forecast a shortage between 1982 the scope of this assessment. and 1987.3] This is however growth from a small base; there were just over half a million About half of all professionals are in office- computer specialists in 1982, 0.56 percent of oriented occupations; for example, lawyers, total employment. Moreover, computer tech- accountants, analysts, and consultants. As al- nology itself may dampen the expected de- ready noted, some highly specialized profes- mand; as computers and their software become sional tasks are potentially subject to com- more usable by nonspecialists, the need for puterization through expert systems. More programmers is shifting from user organiza- commonly, information systems and data tions to producers of computer goods and serv- banks allow part of the professional’s respon- ices, and should grow at a slower rate. Soft- sibilities to be taken over by paraprofessionals ware engineering systems will automate some with less extensive graduate education and less of the work of both programmers and systems stringent credentialization and certification re- analysts. Thus, there is likely to be some lev- quirements. For example, paralegals, engineer- eling off of the need for computer specialists ing technicians, and library assistants do some in spite of the growth in number of computers of the work formerly done by professionals, in use. and are paid less than professionals. Thus, there is strong economic motivation to con- Demand for information scientists may constrain the increase in professional jobs by com- tinue to grow, especially with the spread of bining automation and paraprofessional work- the relatively new industry of information servers, and the number of paraprofessionals is ice, which provides and manages databases, growing rapidly. on-line search services, and customized searching and abstracting.32 It is not clear from oc- Office automation also typically decreases cupational statistics how many information the amount of time that a professional spends scientists there are or how rapidly their num- in accomplishing a given amount of work, for ber is increasing, since many different job ti- example, in telephone communications, locat- tles are used in this new professional area. ing and aggregating information from scattered libraries, or reformatting tables and draw- There are other specialized professional oc- ing graphics. Some tasks incidental to, and cupations that are growing because of com- preparatory to, generating or analyzing infor- puters. For example, personal financial advi- mation can be eliminated or shortened. sors and tax advisors were once used only by the very rich, but small computers made it From this perspective, it can be argued that possible for them to offer their services more the amount of information-handling might in- cheaply to middle-income people who have crease a great deal before requiring a signifi- money to invest but are confused by compli- cant increase in the number of professionals. cated choices among financial services and in- Once organizations have gained experience in vestment and tax-sheltering schemes. successfully automating basic clerical tasks, office automation for professionals and man- The ultimate effect of office automation on agers will look increasingly attractive, since professional employment is hotly debated. their higher wages will increase the cost-saving Some argue that there will be a peaking and possible from automation. eventual decline in information-handling jobs,

Office automation stimulates the growth of ] ‘ National Science Foundation, Projected Response of the some professional categories. Between 1970 Science, Engineering, and Technical Labor Market to Defense and 1978, the number of computer specialist and Nondefense Needs: 1982-1987 (Special report NSF 84-304), jobs grew by 58 percent (compared to 20 per- January 1984. ‘-U.S. Department of Commerce, International Trade Ad- cent growth in all jobs). BLS expects growth ministration, Competiti\’e .4ssessment of the U.S. Information in computer specialists employment through- Services Industrj’, May 1984. 54 Automation of America Offices

including professional jobs.33 Others argue that To the extent that office automation reduced the role of professionals within organizations employment in one or a few industries, cleri- will change, as the information component of cal workers should be able to move to similar products and services increases, and they will jobs in other industries. Their mobility might become “generalists who include many tradi- be greater than that of professionals in in- tional managerial functions in their everyday dustry-specific occupations. This rationale work. 34 Possibly the meaning of the term sometimes appeared in the 1970s, for exam- “professional” will become progressively blurred ple, in explaining why more attention was paid as specialized knowledge becomes more widely to the displacement of aerospace engineers accessible through information technology. than to displacement of clerical workers from the same firms. But office automation appears Clerical Occupations likely to be adopted across industry boundaries The great growth in clerical occupations mir- in a relatively short time. Thus, if computers rors the broad shift from a manufacturing- sharply reduced the demand for bookkeepers, based economy to a service-based economy. bookkeeping jobs would be increasingly diffi- In manufacturing, clerical jobs are only a small cult to find in most industries or locations. proportion of employment, although that pro- Potentially the most dramatic and wide- portion has been increasing. In those service spread impacts of office automation on cleri- industries that collect and use large volumes cal employment are related to data entry, as of standardized data, such as legal firms, in- already discussed. The strong trend toward surance, banking, and credit, more than half capture of data at the point of origin, and fur- of all employees are clerical workers. ther development of optical character recog- A large number of clerical occupations are nition (OCR) technology and speech recogni- generic, and the work is similar across indus- tion technology are likely to greatly reduce tries. For example, bookkeepers, accounting the need for primary keyboarding. OCR is al- clerks, file clerks, general clerks, office machine ready being used to this end. More and more operators, payroll and timekeeping clerks, per- information will be in machine-readable form sonnel clerks, receptionists, telephone opera- from the beginning, and computers and tele- tors, order clerks, and shipping and receiving communication technologies will increasingly clerks can be found in nearly all industries. exchange information between organizations There are more than 100,000 workers in each without the necessity of rekey boarding. This of those categories. Official occupational sta- trend alone will have a strong impact on cleri- tistics treat other occupations as industry- cal employment. specific; thus, according to BLS, all insurance Advanced communications strongly affect clerks (medical) are employed in health serv- clerical jobs that provide the interface between ices, all train ticket clerks and freight rate people, organizations, and activities, for ex- clerks are in transportation, communications, ample, messengers, mail clerks, and telephone and utilities industries, and all credit author- and switchboard operators. Such displacement izers are in wholesale and retail trade. How- has been going on for a long time. It also af- ever, the basic office skills used in those in- fects clerical workers not usually considered dustry-specific occupations are in large part communications workers. A chain of hotels transferable to other clerical occupations.” may have a centralized, computerized worldwide reservation system with local-area net- “For ex~mple, Charles Jonscher, “Information Resources works and microcomputers. When a reserva- and Economic Productivity, Information Economics and Pol- tion is made through a toll-free phone number, icy 1 (North Holland: Elsevier Science Publishers, 1983). ‘Paul A. Strassman, Information Pa.\’off: The Transforma- all appropriate information, including credit tion of Il”ork in the f;lectronic Age (New York: The Free Press, references, will be automatically loaded into 1 985). the central mainframe database. Information There are of course exceptions to this general rule; general secretaries could probabl~’ not become legal secretaries without about next-day guests will be transferred to additional training. although legal secretaries might become the hotels’ microcomputers in the middle of ~eneral (or execut i~’e) secretaries in another industry, the night and a reservation clerk will have only —

Ch 2—Productivity and Employment ● 55 to key in information on last minute walk-in but they tend to depress the number of full- guests. 36 time-equivalent jobs. They allow employers to hire the minimum number of people necessary Not all clerical jobs are equally vulnerable. for their base workload, relying on part-timers of the ten fastest growth clerical occupations and temporaries to handle short-duration in- between 1970 and 1978, all but one (computer creases or peak loads. Home-based work pro- operator) were occupations that require direct grams have the same benefit of load-leveling contact with people outside an office—e.g., since most of the home-based workers are used cashiers and receptionists. These jobs are on the basis of “when work is available. Off- sometimes considered relatively impervious shore data entry, on the other hand, simply to office automation. However, when the per- eliminates jobs in the United States. sonal transactions can be standardized the job can be automated; again the bank’s automated In short, while office automation will likely teller machine is one example. Supermarket lead to a great deal of shifting between cleri- cashier stations are another. cal occupations, it is also highly likely to result in an absolute reduction. across the board. Some clerical jobs include both information- processing and manual tasks. Shipping and weighing clerks, packing clerks, etc., may be Managers and Supervisors only indirectly affected by office automation, Table 2-2 showed that managers comprise but are also vulnerable to the effects of auto- a relatively small proportion of total employ- mated materials handling and storage sys- ment; the proportion varies considerably tems. Many organizations are also beginning across industries. BLS data identify a prin- to electronically print forms as needed, elimi- cipal group of managers, officials, and propri- nating the need to buy, handle, and warehouse etors, and also identify supervisory occupa- preprinted forms. In this case, the cost-saving tions within the clerical and other personnel sought is primarily in the costs of space and categories. within most industries, firms vary materials, but labor-reduction is an added considerably in the proportion of managers to benefit. other employees, with small firms tending to Ten occupations with declining employment have proportionately fewer managers—i.e., a from 1970 to 1978 were tabulating, bookkeep- flatter structure. ing, calculating, keypunching, stenography, Organizations are generally using more data, postal clerk, telephone operators, mail carriers, in more systematic ways, in coordinating their and meter readers. Most of these are occupa- operations. As management becomes more tions directly affected by the early phase of information-intensive, it is possible that more office automation and the effects are now show- managers may be needed. There is some rela- ing up in statistics. They are also occupations tionship between the information intensiveness that are relatively narrowly defined in terms of an industry and the industry proportion of of tasks, again illustrating that the most nar- employees who are managers. Manufacturing rowly defined jobs are those likely to be first firms have relatively low levels of managerial eliminated. staffing, while insurance carriers, securities, In a later section of this chapter, the use computer and data processing services, and of part-time and temporary office workers is mailing and reproduction services have rela- discussed, and other chapters examine in de- tively high levels. Managerial employment is tail the phenomena of home-based work and also above average in accounting and audit- off-shore work. Part-time and temporary work ing services; engineering, architectural, and distribute employment among more workers, surveying services; wholesale and retail trade; transportation, communications, and utilities;

(’(~n]r]]unic’ati(jns Ti’wk, ‘‘ Iiolida~ 1 nns to (Jse SN .+1 (;ate- and printing and publishing. It is relatively w’a?r to I,ink 1,600 P(’s Writ h hl ainframe, N 01’. 5, 1984, p, 49. low in health services and legal services, but 56 ● Automation of America’s Offices —

these industries have large numbers of profes- rations are reported to have adopted office sionals who also act as managers. automation with the explicit objective of flattening the management hierarchy. Heightened There are large numbers of managers whose competition and pressure to cut labor costs work is only partly and secondarily office work; can lead firms to try to keep a lean manage- for example, bar and cafe managers or automo- ment staff, since their salaries are high com- bile repair shop managers. Office automation pared to other workers. At present, the job technology, if adopted, may help them to fo- market for managers is strong because of over- cus on supervisory responsibilities by reduc- cutting of managerial ranks during recent ing the time spent on “office” chores. 37 recession years. In offices, some managers are primarily con- Thus, there are conflicting trends to be concerned with the direction and supervision of sidered in the outlook for managerial jobs, but clerical or production operations and person- they are not immune to the effects of office nel. If fewer clerical personnel are needed with automation. office automation, proportionately fewer supervisory managers should also be needed. In addition, as discussed in chapter 4, office auto- Technology and Recent Trends mation can be used to increase the scope of in White-Collar Employment supervision; that is, one manager or supervi- White-collar employment has grown rapidly sor can monitor the performance of more work- in recent decades. (See figure 2-3. ) The nar- ers or an increased volume of production. rower category of clerical jobs, about 16 per- The tasks of many lower and middle-level cent of all employment, has also grown rap- managers largely center on: 1) information col- idly even through the first phases of office lection, processing, and reporting, tasks that automation. Table 2-3 appears to indicate, how- office automation either facilitates and enhances, ever, that this growth may already have slowed reduces the necessary expenditure of time, or or stopped.38 takes over completely; and 2) communication and coordination, where office automation can be very time-saving. Higher level managers ‘-Dun Business Month, “Executive .Job Market: Filling concentrate more on decisionmaking. Here the Talent Gap, ” November 1984. computers can be used in many ways. Some ‘“Does not include cashiers (of whom there were about 230,000 in 1950 and 2.2 million in 1984). Beginning in January decisionmaking can be, and is being, built into 1983 BLS reclassified some occupations; cashiers and real es- computer programs, reducing the need for tate appraisers were removed from the clerical occupations cat- lower level managers. Management informa- egory. These reclassifications are one of the continuing pitfalls of working with occupational data time-series. tion systems and other kinds of computer programs are designed to help managers make decisions, by integrating and displaying the Figure 2-3.—Changing Percentage of Work Force information they need. In some situations this From 1900-80 White-Collar Compared to Blue-Collar saves a great amount of time for the manager; in other situations, it takes more time to make ~ma) White collar a decision because more information is avail- : 50 — able to be considered. z~ 40 “ In some organizations, information that was E Blue collar once collected, integrated, and laid out by lower : 20 & level managers for review by higher level ex- n lo - ecutives, is now aggregated and formatted by o~ computers and accessed directly by the deci- 1900 1910 1920 1930 1940 1950 1960 1970 1980 sionmaker. This points toward a reduced num- Year SOURCE U S Department of Commerce, S(at/st/ca/ Absfracfs of the Urr/fed ber of lower level managers, and some corpo- Sfafes— 1981, No 673 Ch. 2—Productivity and Ernp/oyrnent ● 57

Table 2-3.—The Growth in the Number of automation. Life insurance carriers, for exam- Clerical Jobs, 1950.84 ple saw sales increase over 49 percent from

Number of clerlcal Growth In the Total employ-merit 1970 to 1980. Yet their labor force increased Year jobs4 (mllllonj number of jobs (percent ) only 9.8 percent. During the 1970s the aver- 1950 - - - 66 11 3V age annual real value added per full-time em- 1960 88 33’1 134 ployee equivalent (a measure of productivity) 1970 129 46 164 1980 169 31 169 for all industries was 1.1 percent; in the insur- 1982 168 –O 6 168 ance industry it was 2.7 percent. From 1975 1984 167 –O 6 159 to 1979 it was 1.3 percent for all industries aThe difference between the 1982 figure for clerical jobs on tables 22 and 23 Ill ustrates the dlff(culty of analyzlng deta!led employment trends because of but 6.7 percent for insurance carriers.’” am blgultles In data sets SOURCES U S Department of Commerce Bureau of the Census Census of Social, economic, and political conditions fa- Popu/at/on f950 1980 1970 1980 and U S Department of Labor vored the expansion of the FIRE industries Bureau of Labor Statlstlcs Current fopulaffo~ Suwej Annual Aver ages 1982 and 1984 during this period. High levels of employment growth during the 1960s and 1970s and the rapid increase in the number of two-income If the automation of office work is labor- small families drove the proliferation of check- saving, why did clerical employment increase ing accounts. The rising level of disposable per- so rapidly during the 1960s and 1970s? The sonal income during much of that period, and capital-output ratio, which has traditionally the fact that more women were earning income been very low in white-collar work,” increased and insuring themselves for the first time, in- steadily (see figure 2-4), but from these figures creased insurance expenditures. Fringe bene- would seem to have had little effect on labor fits also expanded, and workers compensation demand. A closer look at the financial service coverage was extended. A flood insurance pro- industries, which have been at the forefront gram was established. New insurance and fi- of office automation, tends to counter this im- nancial service products responded to, as well pression. They were expanding rapidly dur- as contributed to, the growth in the market. ’l ing this period in part because of the new products and services made possible by their office Because these industries were growing rapidly, office automation in the 1970s constrained ‘1.eontief and Duchin, citing man~ sources, accept that white-collar workers at the beginning of the 1980s worked with growth of their work force but did not reverse an a~’erage of $2,000 in equipment compared to the factcq’ it. The labor-saving effects are nevertheless workers ;$25,000 in equipment; op. cit., p. ,5.7. apparent; between 1970 and 1978, insurance industry professional and technical workers Figure 2-4. —Capital Investment Per Production increased by 24 percent and managers by over Worker, 1970-80 21 percent, but clerical workers increased by

“. only 8 percent. During this first phase of auto- 326 . mation, technology most directly affected cler- 30 — ical work. In the occupations where automa- 25 — 19.5 tion directly substituted for labor the effect 20 “ 168 was greater. Key operators declined by 22 per- 15 “ 10.4 cent, bookkeepers by 7 percent, file clerks by 91 10 — 7.0 20 percent, mail clerks by 11 percent, and typ- 4.8 5 — ists by 12 percent (but secretaries increased 0 III —. 1970 1975 1980 “’Baran, op. cit., pp. 100 ff. Year “Inflation and higher interest rates had a mixed effect; in- c1 ‘anufac’”ring clT””e m“”’”c’ surance carriers, for example, derive more income from investments than from policies but were sometimes locked into older aThe ratio IS net eaul~ment stock (In bill Ions of dollars) to number of Droduc tlon employees In coristant dollars low-interest in~estments and needed new investments to balance these. Inflation left life insurers more vulnerable to disin- SOURCE David Roessner Market Penetration of Off Ice Automat Ion Equip- ment Trends and Forecasts (working paperl School of Social termediation and made forecasting of future cash flows for in- Sciences Georgia Instlfute of Technology 1985 vestment difficult. Liability settlements were also growing. 58 ● Automation of America's Offices

by 8 percent and computer operators by 119 insurance industry, one group of analysts con- percent).” cludes that: In some parts of the insurance industry, . . . some of the present job losses occurring there were also dramatic labor reductions in in the industry are directly attributable to some areas of professional work; for example, computer technology, though more often than among underwriters in the life and health in- not these are the delayed effects of an earlier surance fields, there was a dramatic decrease stage of innovation rather than the latest developments: some of the losses are best rein numbers during the 1970s. garded as the indirect consequences of tech- As a result of the interaction between mar- nology, which for example might allow reor- ket growth and office automation, labor dis- ganization and rationalizations to be made; placement in FIRE industries as a whole clear- and some losses are attributable to separate ly occurred but resulted in depressed growth, factors such as declining market conditions 4~ or out-moded management structures. On the rather than decline, in employment. In finan- whole one might sum up by saying that com- cial services, employment increased by about puter technology has provided the vehicle 2o percent, but growth was lowest in sales and which makes it possible to respond efficiently clerical jobs, and highest for managers and to market conditions, whether this be by ex- professionals.” pansion of business or by contraction of operating costs. 46 The labor-saving effects of office automation are likely to become more apparent in the This analysis agrees with other evidence that near future. The first phase of automation was white-collar employment is becoming more sen- a more direct substitution of machine for la- sitive to cyclical economic conditions. bor than is later office automation, but in the In both future and past shifts in employ- first decade of use, organizational goals placed ment, it is difficult to separate the role of tech- higher priority on better data collection and nology from the effects of market change and reporting and news services. The mass data other broad economic factors. But analysts at handling industries were automating pre-exist- Bell Canada have studied the effects of tech- ing functions, such as payroll, inventory con- nological change on their work force from 1952 trol, and other basic procedures. But they were to 1972, and concluded that “technological dealing with anew technology, with no experi- change resulted in substitution of capital for ence and precedents to guide them; reorgani- low-skill labor, overwhelming any price com- zation of the organizations’ workflow and la- plementarily with capital.’’” bor force took time. In the FIRE industries there are strong indicators that the emphasis In 1952, Bell Canada was using an average has more recently shifted to cost-reduction, of 48 to 52 million person hours yearly, 23,000 and much reorganization and labor force re- to 25,000 jobs. Over the next two decades out- duction is now occurring. Unit labor costs have put steadily increased by 7 to nearly 10 per- in fact been dropping since 1969 and the drop cent per year, or over 500 percent, but labor began accelerating about 1975.4’ demand at the end of the 20 years was less than 15 percent higher than in 1952. Market conditions can either offset or reinforce employment effects. In the case of the The econometric model used in the Bell Can- ada study was designed to separate techno- —— logical effects (i.e., automation) from price and ‘Baran, op. cit. “Valerie Personick, “The Job Outlook Through 1995: In- “ Richard 13arras and Julia Swarm, The Adoption and im- dustry Output and Employ merit,” ~lonthl~’ Labor lie~iew, No- pact of Information Technolo~’ in the UK Insurance Industr~r \rember 1983, p. 34; U.S. Department of I.abor, Bureau of I,a- (1.ondon: The Technical Change Centre, No\ember 1983), p. 21. bor Statistics, ‘f’echnolo~’ and Laborin Fitw Industries, Bulletin ‘-Michael Denny and Melvyn Fuss, “The Effects of Factor 2033, 1979. Prices and Technological Change on the Occupational Demand “Baran, op. cit., p. 105. for I,abor: Evidence From Canadian Telecommunications, ” The ‘ 13aran, op. cit.; also P:ileen Appelbaum, op. cit. Jourmd of Human Resources, XVII, 2, spring 1983, pp.”161-l 76. Ch 2— Productivity and Employment ● 59 market effects. The study concluded that tech- Table 2-4.—Changes in the Percent of Total a nological change out weighed wage/capital and Employment for Involuntary and Voluntary Part-Time Workers as Percent of Total Employment, 1968-84 wage/material ratios in affecting overall employment levels, and in the case of demand Part-time work force for telephone operators, whose jobs were the Involuntary Voluntary primary focus of technological change, far out- Year Total workers workers weighed the effect of output growth. 1968 ...... , ., 14 9“ 0 2.5 ‘ r, 12.400 1969, . . 155 26 129 Small computers and word processors allow 1970 164 31 133 the standard office functions to be automated 1971 ... ., 16.8 34 134 1972 16.8 33 135 in small organizations, and incrementally, with 1973 .., ... . 166 31 135 relatively low capital investment at one time. 1974 . . . . . : 171 35 13,6 Office automation need not involve construc- 1975. , ., 184 4,6 13,8 1976, . . . . 180 42 13,8 tion of new facilities or extensive alteration 1977 ..., . . 180 40 140 of facilities. Where it replaces existing equip- 1978 .., . . 177 38 139 ment—typewriters, calculators, bookkeeping 1979 .., ., . . 17.6 38 138 1980 ...... , 184 4.5 13,9 machines, and old telephone systems—that 1981 . . . . . 186 49 13.7 stock does not represent large amounts of 1982...... 202 64 13.8 embedded capital. Most such equipment is 1983, ., 200 6.5 13,5 1984, ...... 189 57 13.9 more than 5 years old and has already been aThese cal rula! I rjns are for nonagr!cul ! u ~al workers agec 16 anc over amortized. Office computers and equipment SOURCES 1968.81 — Labor ‘orce stat!st IWS derived from the Cur,en( Popu/afjor~ Survey A Dafa BOOA Vo/ume f (Washington DC U S Depar(meot also enjoy a rapid tax write off. For all of these of Labor B u reau of Labor Stat I st I cs Septern ber 1982 Bu I let I n 2096) reasons, office automation may proceed more D 682 1982– Emploumenf and Earn/ngs VOI 30 N o 1 (Wash I nqtm DC U S Department of Labor Bureau of Ldhor Statlsttcs Janu~, y evenly, more widely, and more rapidly than 1983) p 169 1983—Employment and Earnings VOI 31 N,) 1 (Washlnq ton, DC U S Department of Labor, B u reau of Labor Stat I st cs Jan u other kinds of automation did in the past. ary 1984) p 194 1984— Ernp/o) rnt?n( an{f Earn I ngs VOI 32 N c, 1 (Washington DC U S Department of Labor Bureau of Labor Statls The speed with which a technological change IICS January 19851 p 192 occurs, and its breadth, are both important in assessing the impact. A slower pace allows both individuals and the labor market to make Figure 2.5–Changes in the Percent of Total a whatever adjustments are possible. In this re- Employment for Involuntary and Voluntary gard the potential office automation of small Part-Time Workers, 1968-84 businesses is particularly important. Small firms, in many parts of the country, account 20 for the preponderance of office jobs. A reduction in the number of office jobs available rela- 15 -- tive to the total work force would therefore .* ..**** . ● ● ● ● ● O* ● * ● ● * ● ● 8 ● * ● ● ● . . ● ● ● U Voluntary be felt in all areas of the country as well as 10 I in all industrial sectors, although not with the R Involuntary same force in all sections and sectors. t- 5 —

0 I I I I I I I I Part-Time and Temporary Employment 1968 1970 1972 1974 1976 1978 1980 1982 1984

The proportion of part-time and temporary Years workers has been increasing since the early 1950s. The number of voluntary part-time SOURCES 1968.81 — Labor fore e stat tst ICS der!ved from the Current Popu/a/IcI,I Survey A Data Book Vo/urne 7 (Washington DC U S Department workers has remained between 13 and 14 per- of Labor Bureau of Labor Stat I st ICS September 1982 Bu I let I n 2096) p 682 1982—Ernp/oyrnenf and Earn/frgs VOI 30 No 1 (Washington cent since 1970 but the proportion of invol- DC U S Department of Laho! Bureau of Labor Statlstlcs January untary part-time workers has continued to 19831 p 169 1983—Employment and Earnings VOI 31 No 1 (Washing ton DC U S Department of Labor Bureau of Labor S(at{st!cs Janu increase (see table 2-4 and figure 2-5), indicat- ary 19841 p 194 1984—Emp/oyment and Earn(ngs VOI 32 No 1 (Washington DC U S De~artmerrt of Labor Bureau of Labor Stat/s ing that the strongest factor in the growth tics January 1985) p 192 60 ● Automation of America’s Offices —

is not workers’ choice of a more flexible life- But in other situations, office automation style, but employers’ response to economic encourages the creation of a part-time work pressures. In some industries and some orga- force. Where it is used to standardize and de- nizations, slack workloads lead employers to skill work many employers have found it prof- convert workers to part-time in preference to itable to use part-time, low-paid workers. Some a layoff. Other employers, however, are adopt- have reportedly moved to suburban locations ing a policy of keeping a minimum-size work to take advantage of the availability of house- force, which can be temporarily augmented wives willing and eager to work part-time at when necessary .48 low wages because there is another primary wage-earner, with a full benefits package, in There are reports that in other industrial- the family. As discussed in chapter 7, office ized countries automation has greatly increased automation also makes it feasible to use home- part-time work; for example in Japan, “intro- based workers, on a part-time and piece-rate duction of part-time workers and subcontrac- basis. In the long run, office automation may tion has grown massively.’’” Office automa- stimulate a stronger trend toward use of part- tion and creation of a part-time work force are time or temporary workers by allowing em- in some situations alternative or competing ployees to maintain a minimum work force that strategies for cost-cutting but they may also will need supplementing during hours or sea- be complementary. Part-time workers (consid- sons of work overload; and by standardizing ered by BLS as an employee working less than the basic skills needed by clerical workers and 35 hours a week) are cheaper than a propor- some kinds of professional and technical workers. tionately smaller number of full-time employees because they often are paid lower wages In 1955, only 8 percent of American work- and do not qualify for benefits packages, regu- ers were part-time;51 this rose fairly steadily lar yearly wage increases, or job security agree- to about 15 percent in the late 1960s and con- ments based on seniority. There have been tinued to rise to 20 percent by the 1980s. (See many anecdotal and press reports of compa- table 2-4.) Thus, about one-fifth of American nies reducing work hours to one or two hours workers are working part-time. Women are fewer per week than would qualify workers much more likely to work part time, often in as full-time employees, but few companies are order to combine paid employment with child willing to admit formally to this practice. The care. About 29 percent of working women work biggest advantage of part-time workers for em- part time, compared to 12 percent of working ployers however is that of load-leveling; that men. About 21 percent of teenagers aged 16- is, they can be used during parts of the day 19 and employed, are working part time. 50 or week when the workload is heaviest. To In 1983, in the FIRE industries—leaders in the extent that office automation allows the office automation—only 11 percent of employ- work force to be reduced and workflow made ees were part-time. This sector ranked fourth more efficient, it may obviate some interest among major industry sectors, after the whole- in moving toward a part-time work force. sale and retail trade (32 percent), service industries (27 percent), and construction (14 ‘“See, for example, a recent article in Business Week, “Part- percent). In the service industries, a large pro- Time Workers: Rising Numbers, Rising Discord, ” Apr. 1, 1985, portion of the part-timers were probably also p. 62, reporting explicit statements by several company spokespersons about reluctance to staff to full capacity. office workers. ‘“Katsus Nishiyama, “Introduction and Spread of VDT Work and Their Occupational Health Problem in Japan, ” to be pre- In the office-oriented sectors of banking and sented at the 5th UOEH International Symposium in Japan, insurance of other industrialized countries, Sept. 19, 1985. however, part-time work is expected to increase, “’’Business W~k, op. cit. Another strong factor has been the growth in demand for part-time employees by fast-food restaurants, shopping centers and shopping malls, and neighborhood banking locations, many of which are open long hours, “]New Work Schedules for a Changing Society (Elmsford at night, or on Sundays. NY: Pergamon Press, 1981), p. 45. Ch. 2—Productivity and Employment . 61

According to the International Labor Orga- nization, part-time employment in the banking and insurance industries is rising in its member countries, and in Sweden over 26 percent of banking and insurance employees are part-time. 52 ATMs have probably reduced the need for part-time tellers and clerks in the United States. But other forces are now at work. Four of the biggest eight accounting firms, and many financial service firms including Citi- bank, Traveler’s Insurance Company, and other major employers of clerical workers such as Control Data Corporation (CDC) are now emphasizing part-time employment.53 Travelers Insurance Company has developed a job bank of retired professionals for temporary market Pholo cred(t ” Kelly Serwes, lnc research and product development, and plans to train them for use as programmers, part- This simulator exactly duplicates several major word processing systems and is used for testing in an time. CDC has a formal program of using part- employment services firm. timers, which has been in effect for 2 years. The goal is to have 15 percent of their work whom the organization has no responsibility force (chiefly clerical and production workers) for long-range job security. The worker who on part-time or temporary status and another is individually hired on a temporary basis gen- 15 percent as independent contractors. This erally suffers the disadvantages of apart-time goal has been partly realized; by 1984 CDC worker—i.e., not qualifying for benefits and was reported to have 4,500 part-time work- relatively little chance of promotion, and by ers, or 10 percent of their work force. definition has no job security. Many temporary office workers, however, are employed by firms Closely related to part-time work is temporary work, which for employers is another within the new temporary employment serv- strategy for workload leveling. Many clerical ice industry; that firm provides them with as- workers are temporaries, but there is a grow- signments to client firms. The worker may be ing trend toward using temporary program- available to the employment service firm full- mers, systems analysts, computer engineers, time or nearly full-time, or may wish to work and data communications specialists.54 Tem- only occasionally or sporadically. Some employment service firms are now providing their porary workers can be called in on short no- regular workers with prorated benefits simi- tice when work is briefly or seasonally heavy, lar to those that they might receive as perma- and can be dismissed almost instantly and nent employees of a large firm. More gener- without penalty. From the employer’s view- ally, however, temporary workers do not have point temporaries are part-time workers for such benefits. “International Labor Organization, Advisory Committee on Salaried Employees and Professional Workers, The Effects The temporary service industry is growing of Technological and Structured Changes on the Employment rapidly, nearly twice as fast as GNP over the and Working Conditions of Non-Manual Workers, Eighth Ses- last 14 years; and faster than the computer sion, Geneva, 1981, pp. 50-51. “Joann Lublin, “Shorter Hours: More Managers Are Work- equipment industry, to a payroll of $5.5 bil- ing Part Time; Some Like It But Others Have No Choice, ” lion in 1984.55 At first, it appeared that auto- Wall Street Journal, June 2, 1982, p. 50. “John J. Davis, President of Worldwide Computer Serv- “The National Association of Temporary Services reported ices, Inc., “Is There a High-Tech Pro in Your Future?” Man- a payroll of $431 million in 1971 and $5.50 billion in 1984, an agement Information Systems Week, May 22, 1985, p. 64. average of nearly 20 percent growth per year. (Figures sup- (continued) mation would be a barrier, since temporary tors, lawyers, dentists) to shift the adminis- workers would be unfamiliar with equipment, trative costs and benefits costs associated with which varies widely between offices, but the employees to a contracting firm, which can larger temporary agencies provide training in benefit by economies of scale.58 The leased a broad spectrum of office automation equip- worker usually enjoys a full benefits package, ment and applications, particularly word proc- although he or she is not guaranteed perma- essing. Also, automation has standardized and nent employment (in practice, the job secu- de-skilled some tasks for which temporary rity may be about the same as in conventional workers can be used. Clerical occupations ac- forms of employment). counted for over 60 percent of temporary as- Office automation appears to have given a signments made by the industry in 1980, al- large boost to the growth of independent con- though it accounted for only 49 percent of the tractors offering business services such as revenue since clerical wages are generally lower word processing, data entry, and computer pro- than those in technical, medical, and indus- gramming. Independent contractors are self- trial assignments made by the temporaries in- employed, with all the risks and benefits this dustry. entails; he or she assumes the costs associ- Temporary computer and data communica- ated with slack work periods and loss of work- tion specialists, and other professionals, are er’s benefits in return for autonomy. The work in growing demand. They can offer up-to-date may be done in the employer’s facility, with knowledge of current systems, languages, and the contractor/worker effectively indistinguish- protocols, because of recent schooling and var- able to observers or coworkers from employ- ied experience, and may choose to work as tem- ees. The work may however be done in the con- poraries for fear of becoming trapped in a nar- tractor/worker’s home, using the communication row specialty or job where their knowledge capabilities of office automation. will gradually become obsolete.5G A computer Some clerical and professional independent services official attributes the trend toward contractors are entrepreneurs, or small busi- use of temporary professionals in computer- ness men and women, seeking multiple clients related work to “the triangle brought about either at one time or in sequence. They may by mounting costs in corporate and govern- or may not plan to expand their activities and ment-mandated fringe benefits, the inability take on employees of their own. Many con- of many companies to meet peak workloads tractors on the other hand work for only one with their permanent staff, and finally the firm and are in effect employees without the growing number of professionals who desire benefits otherwise associated with employ- to change their work patterns.’’” ment. The unresolved tax and legal issues asso- Closely related to temporary employment ciated with independent contractor status are are employee leasing and use of independent discussed at greater length in chapter 7 in con- contractors. Employee leasing may be used nection with home-based clerical workers, many by employers as a still longer term strategy of whom are former employees converted to for workload leveling (by month, year, or proj- the status of independent contractor. ect-duration), but it is more generally used by Part-time and temporary employment and very small firms or professional offices (doc- independent contracting are likely to increase as automated offices move toward a lean work (continued from p. 61) plied by the National Association of Temporary Services and force with need for occasional supplementary also based on the Census Bureau’s Count~~ Business Patterns, business services, and as more workers are fa- “Vital Statistics of the Temporary Help Industry, ” Contem- miliar with the equipment. There are strong porary Times, vol. 2, issue 6, fall 1983.) ‘ I]a\’i:’, op. cit., says “In practical terms, the! do not want . to spend the next 5 ~rears of their careers learning how to appl~: %om-e” service contracting companies make their profits Unix or C into an insurance conlpan-v microcomputer system. from the interest on advance deposit of the monthly fees paid Da\is, op. cit. I]y the client to cover wages plus associated costs. Ch. 2—Productivity and Employment ● 63 benefits in it for workers as well as for em- able proportion of the population no longer ployers. Many people prefer and actively seek has these protections through employment, part-time work. Students, mothers, and retired then the taxpayer is in the long run likely to people often want to work less than a stand- bear more of the burden of the illness, old age, ard workweek; others want more time for fam- and death for these people, and the average ilies, education, or recreation. They choose to level of health and well-being of the popula- trade income for leisure time, and are willing tion is likely to decline. to pay the additional costs in terms of loss Society may be willing to bear this risk, if of benefits such as health insurance, lack of that is the price of allowing people to choose job security, and diminished likelihood of pro- part-time work. If part-time work is not a motion and advancement. The standard 40 choice, but the only alternative available to hour workweek has not changed since the them, and especially if this limitation on choice 1930s, and part-time work is the way some is the result of employers’ decisions, then the people create their own shorter workweek, public policy issue becomes one of whether this Many ‘temporaries” choose this form of em- shifting of responsibility for basic protections ployment because they want or need the flexi- from employer to employee is acceptable to bility it gives them.. Some use it as a form of the society at large. Historically, the choice job-hunting, or trying out potential employers. of full-time or part-time work has been re- However, some temporaries are unable to get garded as the individual’s prerogative. We assignments as regularly as they wish, and must then ask: is this still a free choice, and find the unpredictability y of their income a se- will it be so in the future? To what extent is vere disadvantage, but have been unable to involuntary part-time work increasing? find permanent employment. The official part-time employment figures At a minimum, part-time work is preferable based on annual aver-ages do not tell the whole to unemployment, Employers sometimes con- story. The number of people who work part vert full-time employees to part-time status time at some time during a year is often dou- during a recession, in preference to laying them ble the annual average. For example, in 1978, off and losing a valuable worker. 59 a recession year. the annual average was 21.4 million part-time workers, but a retrospective If part-time work is beneficial to many em- survey indicated that 40.9 million people, at ployers and is sought by many employees, some time during 1978, had only part-time under what conditions is it a public policy work. ’() While the annual average showed 3.4 concern? First, if enough full-time jobs are million of the part-timers as working part-time eliminated–-i.e., converted to part-time jobs, involuntarily (that is, because they could not opportunities will be diminished for those who find full-time work)” the retrospectiv’e survey must have full-time work to make enough counted 10.1 million. The number of involun - money to support themselves and their de- tary part-timers has been increasing, as shown pendents. Second, in the United States, many in table 2-4, to more than a quarter of all part- social services and income protection mecha- timers (and about 5 percent of all employed) nisms are provided not directly by tax payers but through employee benefits packages–e.g., health insurance, life insurance, income during illness or childbirth, pension plans, and to some extent training and higher education. These protections are much more costly, if they are available at all, on an individual basis. If conversion to part-time work means that a siz- 64 ● Automation of America’s Offices at present. Recent increases in involuntary material goods, stimulating the market for part-time employment and multiple-job hold- them, providing paychecks for workers to buy ing for women suggest that there may not be those goods, and creating capital to be invested enough full-time jobs for those that seek in production of more and still cheaper goods, them.62 Thus the number of people who “want” further stimulating the market. to work part-time may be smaller than as- In general, workers displaced by mechani- sumed, and the change in attitudes and life- zation have taken other jobs in the same in- styles cited above as a factor in the trend may dustry as it expanded, or moved into new or not play as strong a role as is often assumed. expanding economic sectors. Public interest in part-time and temporary The argument from history is powerful; in work is therefore twofold: general, technology creates rather than des- 1. that the number of involuntary part-time troys jobs. That is why developing nations, workers not increase to undesirable levels, with exploding populations, struggle to indus- causing a deterioration in income levels, trialize. There are however several important because full-time jobs have been converted considerations to be noted. The great waves to part-time jobs; and of mechanization and automation in the past 2. that the costs of worker protection not were still part of the continuing industrial rev- be shifted from employer to worker to a olution. The United States was, in the 19th degree that ultimately causes them to be century, a developing nation—an agricultural borne by the taxpayer. nation becoming an industrial nation, with an expanding national market based on plentiful These unanswered questions again point to resources, in which the consumers who bought the need for more careful and systematic mon- goods were also the workers that produced itoring of trends in employment, since a sig- them. From World War II through the 1950s, nificant increase in the number of long term at least, U.S. technology enjoyed worldwide involuntary part-time workers would challenge preeminence across the board. But this is now the adequacy of existing mechanisms for in- a mature economy, strong but with increas- come security and other employee protection ing competition for both domestic and world mechanisms. markets. Imports are a major factor in the economy. It is therefore not clear that the Analogies From Past Waves American economy will grow, in the future, of Automation at the vigorous rate of the past. In an economy that is growing more slowly, new jobs Throughout modern history, mechanization are created at a slower rate, and workers do and automation of work have brought dire not enjoy the mobility they have in a rapidly warnings of unemployment.63 But employment growing economy. has continued to expand. Mechanization and automation have contributed to, or driven, this Secondly, past waves of automation have expansion by reducing the costs of food and been concentrated in one or a few industries, for example, at one time agriculture, at another “A~cordi~g to Professor Eileen Appelbaum in a talk pre- period commodity manufacturing or industries pared for presentation to the Panel on Technology and Women’s that could use assembly line techniques. Auto- Employment of the National Academy of Sciences, Washing- ton, DC, Feb. 17, 1985. mation proceeded unevenly across economic ‘] Mechanization is the use of machinery as a substitute for sectors, crafts and occupations, industries, human or animaJ labor. Automation is a narrower term, mean- organizations according to size, and geographi- ing the use of machinery that “makes decisions” about the work without human intervention; that is, machinery with con- cal regions. Jobs were increasing in some in- trol systems that incorporate the principle of feedback to fine- dustries and occupations, when jobs at approx- tune or correct the machinery’s operations. Computerization imately the same skill level were decreasing carries this internal decisionmaking a great deal further, with the use of information stored in memory and by the sensing in other industries. Large companies auto- of external conditions. mated well before small companies. Many Ch. 2—Productjvjty and Employment . 65 kinds of manufacturing automation, for exam- 32 percent of total employment. Now the num- ple, have never been adapted to batch manu- ber is decreasing. BLS reports that 2 million facturing or for small machine shops. This con- manufacturing jobs have been lost since 1979.64 trasts with office automation, which can be Had white-collar employment not been expand- used in basic office functions across all indus- ing rapidly, new workers could not have been tries, and especially with small computers and absorbed into the economy. stand-alone word processors, which allow even At the beginning of the 20th century, there small offices to automate. were only 5.1 million white-collar jobs, account- Although total employment has grown ing for under 18 percent of all employment. through and after historical waves of automa- By 1950 these jobs had quadrupled to nearly tion, each has left behind some structural un- 22 million, but still accounted for less than employment. In many cases, older workers 37 percent of employment. In 30 years-less failed to make the adjustment and new jobs than the working lifetime of an office worker— went to new workers with more recent train- the number of white-collar jobs has more than ing, new skills, or more flexibility. In other doubled to nearly 52 million jobs, accounting cases, new jobs and new industries more than for at least 55 percent of all American workers. compensated for lost jobs in number, but were Structural change in the economy has cre- located in other regions, leaving displaced ated jobs in some sectors while it displaced workers behind. (The coal miners of Appalachia jobs in others. The result is a net increase in are a pertinent example.) employment, and there is also a more equi- Agricultural employment declined steadily table distribution of employment opportuni- from 27 percent of all employment in 1920 to ties (e.g., better status jobs for more people, 2.7 percent in 1980 (an absolute loss of 8.7 mil- and more jobs open to women). Creation of lion jobs) as agriculture was mechanized. See jobs has by and large kept up with both popu- table 2-5. However, employment was created lation growth and growing participation in the in food processing (1.6 million jobs in 1982), labor force. In 1950,57 percent of the popula- in agricultural research, and in transport and tion was in the labor force, but by 1980 this sales of food. As population and the economy had grown to nearly 64 percent. grew, blue-collar employment stabilized. There were only 3 percent more blue-collar jobs in 1980 than there were in 1950, while the work force grew by 69 percent in those decades. The 30.5 million blue-collar jobs in 1950 were over “BLS originally reported to the Joint Economic Committee that 8 million jobs had been lost, but issued a correction after half of total U.S. employment, while the 31.5 this was reported in the press. See “BLS Corrects Figures on million blue-collar jobs in 1980 were less than Factory Job Losses, ” Washington Post, June 18, 1985.

Table 2-5.—Shifts In Employment by Industry Sectors, 1900-80

1900 1910 1920 1930 1940 1950 1960 1970 1980 Total labor force (000). .29,030 37,291 42,206 48,686 51,742 58,992 67,990 79,802 104,058 White collar: Growth ...... 560/o 320/o 36?40 12%0 3470 260/o 39”!0 420/o Labor force ...... 18°/0 21 “/0 250/o 290/o 31 0/0 37 ”/0 400/0 47 ”/0 51 “/0 Blue collara: Growth ...... 370/0 140/0 190/0 11%0 14 ”/0 9“/0 190/0 21 “/0 Labor force ...... 45°/0 480/o 480/o 490/0 520/o 520/o 490/0 490/0 450/0 Farm: Growth ...... 60/0 –10/0 –90/0 – 130/0 –230/o –41 0/0 –400/0 –60/0 Labor force ...... 380/. 31 “/0 270/. 21%0 17“/0 12 ”/0 60/0 30/0 30/0 %!s ~flc)udes rrrarrua/ and serwce Workers SOURCES” U S Department of Labor, Bureau of Labor Statlstlcs, H/stor/ca/ Abstracts, Co/onla/ Times to 1970, Series D, Nos 182.232, p 139, and U S Department of Commerce, Statfstica/ Abstracts of the Urr/ted States— 7985, p 400 66 ● Automation of America’s Offices

But it is not clear that the creation of new employment resulting from fluctuations in ag- jobs has completely compensated for the long gregate demand, which can be an acute and range labor-saving effects of mechanization serious problem during recessions but declines and automation. High unemployment rates when the economy recovers. The fourth kind (7.5 to 7.1 percent) have persisted in spite of of unemployment and the most serious in long- the highest employment ever achieved in this term considerations is structural unemploy- country. In 1984, after recovery from a reces- ment, often defined as a mismatch between sion, 3.5 million new jobs were created (the the supply of jobs and the supply of workers second highest growth rate in our history) but with the skills needed for those jobs, but in unemployment did not significantly decrease theory also possible when there are not enough and stood at 7.2 percent at year end. 65 If those jobs, at any skill level, to engage all would workers are counted who have dropped out be workers. of the labor market because of discouragement, Until about 1970 it was generally assumed or have accepted part-time work because they in this country that an “acceptable’ level of can not find full-time work, the unemployment 67 total unemployment was about 3 to 4 percent. rate would be several points higher than it offi- But the rate has not been that low, even in cially is; for example, in early 1985, about 10.8 periods of expansion, since 1969. As shown percent rather than 7.3 percent. The number in table 2-6, unemployment rates have been of jobs in manufacturing declined by 1.6 mil- rising for about two decades, not falling back lion from 1979 to 1984, and in the goods-pro- even in “boom” years to previous lows. ducing sector very few industries employ more workers now than before the recession began.66 This long-term rise in unemployment has During a recession, some markets maybe lost been attributed to many causes. One is dem- to international competitors, and some orga- ographic-the flow of young people and women nizations do not recover. Also, organizations into the labor market during the 1970s. Others tend to adjust slowly to labor-saving tech- are shifting industry patterns (e.g., involun- nology, preferring normal attrition to layoffs; tary job loss in the automobile industry as a but when layoffs are forced for other reasons, result of foreign competition), changing life they are likely to take advantage of this to styles (willingness of people to take temporary eliminate redundant jobs permanently. or part-time jobs for the sake of leisure time, or greater mobility), and slackening of aggre- The “normal” level of unemployment has gate demand. But as shown in table 2-6, the in fact been rising for at least half a century. increase can be seen through both the troughs Several kinds of unemployment are usually distinguished. One kind is “frictional” unem- ‘ ‘In fact, unemployment rates frequcntl~’ exceeded this fig- ployment–that which is normally attributed ure in recession years throughout th<~ centur}’ and from 1931 to the demise of individual firms and the mo- to 1910 was higher than 14 percent, with mt)rf’ than 20 percent of thtj l~h~i. forc~’ unernplo~wd in 1932. 1 ~~~ ~;. 19;\4, itnd 1 !);l~), bility of workers moving between schools, jobs, During the t~’ar ~em-s unemplo~rnent Jf :IS \ lndc,r ? perc(>r-. t, :1 nd and occupations. Another kind results from }Ias heen on an upwnrd ~lope since then. relatively discontinuous or sudden expansions of labor supply, for example, disbanding of a military force, a wave of immigration, or— Table 2-6. —National Unemployment Rates Dt.lring less precipitous but still unprecedented–the Recession Troughs and Recovery Peaks, 1961-84 increased participation of women in the labor I+ecesslon troughs force in recent years. Third, there is cyclic un- Recovery peaks 1961-69, ., . . 3,6°/0 1969 -70... ..5 80/0 1973, ...... 4,8 ‘ U.S. Depa,tnwnt of I,abor, Bureau of I.abor Statistics, 1973 -75., . . ., . . . .8.3 1979. , ., . . . . .6.0 The ~jn]plo~’n~ent Situation (monthly) and l~mplqJrment and 1980, ...... 75 1981 ., ...... 7,4 Earnings. Januar~’ 1984: I,inda LeGrande ‘‘Employment Status 1981 -82.., ...... 10.6 —. 1984...... 7,1 of the N at,ion: Data and Trends, Congressional Research Ser\’- SOURCE Bureau of Labor S[attstlcs data compllecl by Michael Podgursky ice. 1 \sLIe Brief 11182097, updated Ma~ 6, 1985. Sources of Cecular Increases In the Unem@oymenl Rate 1969-1982 “ I.e(;rande, op. cit., p. 3. Afonth/y Labor Rev/ew July 1984 p 20 Ch. Z—Productivity and Emp/oyrnent . 67

and high points of business cycles. Economist During the coming decade, from 1985 to Michael Podgursky notes that there has been 1995, the population will grow by about 10 a long-term rise in involuntary job loss and percent. But the work force will grow about argues that: 16 percent, from 113.5 million to well over 131 million; nearly 18 million more jobs will be . . . rising structural unemployment in tradi- 69 tional segments of the labor force may also needed. There will be fewer young workers have played a significant role . . . the secular entering the work force each year; the num- rise in the unemployment rate since 1969 ber of people in the work force who are under seems to have been generated by more than 24 will in fact decline as will the number of just labor market adjustment problems asso- workers 55 and over, while the number of ‘prime ciated with a rapidly growing labor force.68 age” workers, age 25-54 is growing. These It is worth noting at this point that Podg- changes of course reflect wide variations in ursky’s analysis suggests that structural un- the birth rate in past decades; the average age employment so far may have affected primar- of workers will increase. ily blue-collar jobs. This would argue that both About 65 percent of the workers added to automation and rising imports of capital goods the work force will be women (by 1995, they have played a role. Both will also increasingly will make up at least 47 percent of the work affect white-collar work in the future (see chap- force). The number of working women between ter 8 for a discussion of off-shore sourcing of the ages of 35 and 44 is expected to more than data entry work). double, and the number between 45 and 55 In summary, the number of jobs has con- should increase by nearly 60 percent. Women tinued to increase through waves of mechani- in these age groups who are already working zation and automation in the past; the U.S. are heavily concentrated in clerical occupa- economy was growing strongly, and an as- tions. This is a demographic group that will sumed major driver in this growth was tech- be strongly affected by the outlook for office nological advancement. But there are disturb- jobs over the next 15 years. The proportion ing signals that structural unemployment has of nonwhite workers will also be growing; now 12.5 percent, they will be 14.5 percent of the also grown. work force by 1995. The number of black women in the work force, for example, will increase The Future White-Collar Labor Supply by over 50 percent. Since minority women are The number of office jobs is likely to grow disproportionately represented in lower level more slowly at best, and at worst to decline, clerical jobs, this is another group that will with a possible precipitous decline in lower be differentially affected by office automation. level clerical jobs such as data entry if certain A further discussion of the effects on these technological developments proceed as antic- groups is in chapter 12. ipated. The effect on employment levels must be considered in terms of the supply of labor– or the demand for jobs.

‘“hl ichae] ~)(d~wrsk: “Sources of S(,(ular 1 ncr(’[lses in the I nenlpio}nlent lia Ce, j ~jog. I fj~~,”’ ,IIOn/h)l I.;~lJor Ret’ieu’. ,Jul}’ ‘ ‘This is the middle grow’~h scenario used I}s H 1.S; SWJ f;m- 19(W, p. 2 }. pfo,}ment IJro.lectjons for 1995, Bulletin 2 19’7, I?l :+rch 19HI. 68 . Automation of America’s Offices —

CONCLUSIONS

The most likely outlook appears to be slow- rective actions in a timely fashion. The fur- ing growth in office employment over the next ther possibility of a significant increase in part- decade; some decline in office employment could time and temporary work, at the expense of begin by 2000. Slowing employment growth, full-time employment, should also be watched or even decline, is most likely to occur in cleri- carefully, lest it leave a growing proportion cal occupations but may also affect lower and of American workers without essential bene- middle management positions. fits, income security, and other social protections. This outcome is not certain or inevitable. Strong growth in the U.S. economy and con- As has been noted throughout this chapter, tinuing growth in demand for information, and however, the ability of Federal policy makers information-based products and services may to monitor technological change and its effects outweigh the labor-saving achieved through on employment and the structure of the econ- office automation. Nor would slow growth in omy is weak. It is limited both by inadequate office employment necessarily result in lower data and by lack of capability in technologi- overall employment levels. Growth in other cal and economic forecasting. The latter limi- occupations could more than compensate for tation in turn, reflects in part the state of de- a decrease in office jobs, especially if higher velopment of these disciplines themselves; office productivity contributes significantly however, in the civilian agencies little resources to the productivity of U.S. industry and its are being allocated to improving these capa- competitiveness in world markets. bilities and recent budget cuts, may have further eroded government capability for fore- The possibility of slow growth or decline in sight and planning, at least in the important office employment, which now occupies about area of information and communication tech- 45 percent of all employed Americans, is never- nology development. theless something which Congress should watch closely, in order to take preventative or cor-

POLICY CONSIDERATIONS: LABOR MARKET ADJUSTMENT OPTIONS

The Need for Monitoring of Structural That kind of serious monitoring and plan- Economic Change Related to ning is not being adequately done. Executive Information Technologies agencies have few incentives to warn of possible long-range problems when such warnings, While the possible long-range effects of of- or the preparatory actions they imply, may fice automation can be foreseen, they are sub- call into question immediate administration ject to many and complex uncertainties related policies or the assumptions around which they to broader changes in the national economy are framed. and the global economy, as well as to natural Congress may, therefore, wish to consider social adjustments and accommodations and now how such monitoring and long-range plan- to specific policy interventions. Nevertheless, ning may be set in motion. the potentiality is troublesome enough to merit both careful monitoring and systematic con- There are serious institutional barriers to tingency planning by responsible agencies of such analysis within the executive branch of the Government. Government. The first necessity for analysis Ch. 2—Productivity and Employment ● 69 of emerging and potential employment prob- that white-collar unemployment is becoming lems related to structural change in the econ- a serious problem. omy is the availability of time-series data orga- Discouraging the spread of office automa- nized in appropriate categories. There are at tion in the United States is clearly undesir- present troublesome deficiencies in the way able, because of the benefits it promises in in which labor data is collected and organized terms of productivity and in terms of the qual- for use by government analysts. A second ne- ity of work life; and discouraging it is also vir- cessity is the continuing development of ca- tually impossible under the U.S. economic and pability for monitoring and forecasting tech- constitutional framework. nological change. To analyze the employment implications of technological change, there Some of the marginal effects of office auto- must be a close link between technical, eco- mation on employment could be controlled nomic, and social science knowledge and ana- directly. For example, Congress may wish to lytical expertise. There is no institutional lo- consider options to discourage the off-shore cus in the executive branch of the Government sourcing of office work, or of the narrower cat- developing excellence in the technical moni- egory of data entry, should this increase to toring and forecasting of information and com- the point of significantly affecting clerical jobs munication technology and studying the eco- in the United States. nomic, social, and political implications, despite Conventional kinds of policy intervention the central role that information and commu- would aim at improving labor market adjust- nication technology now plays in the economy ment—that is, helping displaced workers get and in the Government itself. On the contrary, new jobs. These mechanisms might include a some of the relevant but partial and fragmented broadening of the applicability of labor market functions and capabilities that have been de- adjustment support to white-collar workers, veloped along those lines have recently been and an increase in the level of that support. curtailed or weakened by budget cuts (e.g., the planning and forecasting elements within the In the matrix of 1982 dollars, the money Institute for Computer Science and Technol- spent by the Federal Government on general ogy in the National Bureau of Standards). employment and training programs and for the Federal Employment Service per labor Congress should therefore consider means force participant has fallen from $46.35 in 1970 of mandating and implementing a mechanism to $30.30 in 1982, a 35 percent decrease. This or governmental unit within the executive is about one-quarter of the expenditures in branch with the capability for systematic mon- some other industrial nations, for example, itoring, analysis, and reporting of changes in Sweden. As pointed out by an expert in labor the structure of the economy related to fun- adjustment policy:70 damental changes in the technologies of communications, computers, and information man- Current policy takes a passive orientation agement. toward the labor market and services only the most disadvantaged workers. What is required is a more activist policy in which structural Longer Range Policy Options change is anticipated and a broad segment of If, as it appears possible, office automation the labor force is assisted in adjustment. With- will over the long run lead to inadequate growth in demand for office work or outright decline ‘Mi~hael-P~d~rsk~’, IJni\ersit~ of hl[lss:iclll]s[~tts, “ I,atx)r hlarket Policy and Structural Adjustment, ” a paper prepared in the number of office jobs, or in the narrower for the Conference on U.S. Industrial Polic?r and International but still large category of clerical jobs, what I)e\’elopment, held b~ the Overseas 13e\’elopnwnt Council, J$’ash - could be done about it? The policy options dis- ington, 1 )C, hl ar, 4, 1983, l)odg-ursk~ made this argument in the context of displacement of manufacturing workers and o\er- cussed below are long-range options, interven- all structural changes in the econornf’ and was not specifically tions to be considered if and when it appears referring to white-collar displacemc’nt. 70 ● Automation 0f America Offices

out such a change existing employment and working hours by taking second (part-time) training programs will continue to play only jobs, which would tend to make the strategy a marginal role in assisting workers in the ineffective. mainstream of the industrial labor force who face economic hardship as a result of ongoing In effect, the standard workweek may be structural changes in the economy. (Empha- shortened without policy intervention if the sis added. ) use of part-time workers increases. This has An alternative or complementary strategy disadvantages from a public interest view- is to focus Federal programs on those office point, because as discussed above it would re- workers apt to be most directly and strongly sult in a deterioration of income security, and affected, and also relatively disadvantaged in very likely a long-range increase in the costs terms of current employment status. This of necessary social services and/or an increase group includes: 1 ) those in specific clerical oc- in the share of that burden borne directly by cupations generally at lower levels of the wage taxpayers. scale, most of whom are women; 2) minority To some extent that problem might be al- workers; and/or 3) all women office workers, leviated by laws requiring the prorating of all since even in managerial and professional oc- workers benefits packages, stronger controls cupations women as a group have less seniority over conversion of employees to independent than men and are concentrated at the lower contractor status (or more stringent definition levels of the occupational hierarchy most likely and clarification of that status), and nation- to be affected by automation. wide eligibility of involuntary part-time work- Existing job training programs and labor ers for prorated unemployment benefits. This exchange or employment service systems that would lead to a more rational allocation of la- provide labor market information are primar- bor resources by eliminating the advantages ily’ framed around blue-collar employment.;71 that accrue to employers who substitute part- programs available to displaced workers in the time workers for full-time workers not tO level automobile and steel industries, for example, the workload but to save the cost of fringe have given relatively little attention to office benefits. Rigorous cost-benefit studies would workers in those industries. There may be ways be necessary, however, to assesss the desira- to improve the quality and availability of la- bility” of such policy action~: they should in- bor market information and counseling serv- clude cost-effectiveness studies to determine ices for office workers, with an emphasis on the relative advantages to employer sponsored forecasting changes in occupational demand. fringe benefits publicly provided social services. What Action Is Needed NOW? Chapter 3 Training and Education for Office Automation Contents

Page Technology and Training...... 76 The Stakeholders ...... 76 Basic Skills Required for Office Automation...... 78 Determining Training Requirements ...... 79 Methods for Delivery of Training ...... 79 How Is Training Obtained? ...... 81 The Adequacy of Office Automation Training ...... 83 Education for Office Automation Technologies . . . 85 Teachers and Computers ...... 87 Curriculum Development ...... ‘ ...... “. 87 Access coeducation...... 88 Policy Considerations...... 89 Policies in Foreign Countries ...... 89 Existing Legislation ...... 89 State and local Practices . . . 91 Policy Options ...... g~

Tables 7’ahle No. [~~g~ 3-1. Average Costs for Training Among Selected Office-Rela~ed Occupations 77 3-2. Sources of Training Needed for Obtaining Current Job Among Representative Selected Office-Related Occupations . . . 84 3-3. Sources of Training for Skills lmpro~’ement Among Re[*rcsentative Office-Related Occupations . 85

Figure Figut-e NO. P2ge 3-1, The IJse of Computers in Elementary and Secondary School Education 86 Chapter 3 Training and Education for Office Automation

schools, private schools, commercial schools, and employers. hluch of this training is recreational, such as crafts, photography, and travel classes. However, much of it is also job related: for example, computer courses.

There are signs that a large part of the population does not, have access to training, which creates inequities in opportunities for available jobs, The lack of coordination on a national level of information on training and education for work and on job opportunities hampers t he ability of individuals to plan careers and tO adju st to changing job markets. The benefirs for the individual changing new skills are notonly higher income and greater imcome security, but also an increase in self- esteem and confidence. which promotes the ability to learn additional new ski11s.

Training and continuous education and opportunities for acquiring office automation skills 76 ● Automation of America Offices — —-

TECHNOLOGY AND TRAINING

New technologies and the accompanying of these courses were in formal educational training needs seem to operate in cycles. The institutions such as universities, vocational training cycle for a technology has been de- and trade schools, community colleges, or scribed as follows:l elementary and high schools. Twenty-seven percent of the courses were provided by busi- new technology introduced—employers ness, labor, and professional organizations or provide extensive training and upgrading government agencies. Sixty-one percent of the of employees because of lack of available courses taken were job related, that is, were expertise in the work force; taken to improve skills for a current job or technology becomes widely adopted and to get a new job.4 equipment is standardized-specific skills become general skills; employers lose employees to other firms; The Stakeholders employers cease to provide general train- According to the Bureau of Labor Statis- ing; training is shifted out of the work- tics (BLS) the work force is expected to grow place and into the schools, and firms fo- by 23 percent by 1995. BLS projected growth cus on firm-specific skills; of 1.6 percent per year between 1982 and 1990. increased demand makes it feasible for This would slow to 1.0 percent per year be- public and private schools to standardize tween 1990 and 1995.5 This is based on a pro- and formalize training; and jected population increase of 12.5 percent by the industry using the technology, or the 1995. 6 technology itself, declines; demand for skills contracts—training focused on re- About 75 percent of the U.S. labor force for placement needs of the firm and on retrain- 2000 is already in the labor market, creating ing of displaced workers. a great need for adult learning opportunities. As the “baby boom” generation ages, the need Office technologies are in the early stages for teaching new skills to an adult work force of this cycle. Some employers are continuing has been termed an “adult learning crisis.’” and even increasing their expenditures on The term “crisis” refers to the wide gap in training, but with the largest proportion spent future skill requirements for work in auto- on management skills training. Some are be- mated offices and the current capacity to train ginning to require skills in using automated adults, and was identified for example in the equipment as a condition for employment, as Leontief-Duchin employment forecast described they find a more plentiful supply of already in chapter 2. Changes in elementary and sec- trained workers. ondary education will have little immediate Public and private educational systems are impact on these adult learning needs in the now offering training in office automation as next two decades, since the formal educational well as providing the genelal education needed system may reach only 25 percent of that work by office workers. U.S. companies spend $40 force that are new entrants. billion per year on further education and training of workers. z Over 21 million people par- ‘Tra”ning, October 1983, pp. 54-68. ticipated in adult education (part-time, non- Randolph Brown, “Demographics of the Current and Fu- degree studies) in 1981.3 Fifty-seven percent ture American Work Force, ” Profit Sharing, vol. 32, Novem- ber 1985, pp. 5-17. ‘Patricia Flynn, The Impact of Technological Change on “The BLS projected population for 1985 was 237.5 million, Jobs and Workers (Waltham, MA: Bentley College, March 1985). The population, according to the Bureau of the Census, actu- -Manpower Comments (Washington, DC: Scientific Man- ally reached 238 million in May of 1985 that indicates that power Commission, July-August 1985), p. 7. the total for 1985 will be somewhat higher than was projected. ‘Digest of Education Statistics, 1983-84 (Washington, DC: “Lewis J. Perelman. The Learning Enterprise: Adu)t Learn- U.S. Department of Education, National Center for Education ing, Human Capital and Economic De\’elopment, The Council Statistics, December 1983), p. 157. of State Planning Agencies, 1984, p. xv. Ch. 3—Training and Education for Office Automation . 77

Because of continuing technological change, part of the office work force because of a higher office workers will have to train and retrain birthrate than whites and because of high im- over a lifetime. This will have a heavy impact migration rates. on the resources of both providers of training The group most effected in the past by dis- and of those who are trained. In 1981, when crepancies between skills required for avail- the average annual earnings in private indus- able jobs and their own education and skills, try were just over $13,000, 42 percent of the are young workers, and especially those from participants in adult education had incomes inner-city minorities. More than 40 percent of of over $25,000, 42 percent had incomes of the unemployed in January 1983 were under $10,000 to $25,000, and 12 percent had incomes 10 25 years old. The rate was 50 percent for black of under $10,000 (the remainder were unre- teenagers. This situation may be somewhat ported).” alleviated by the decrease in number of young Average costs for training in some office- workers, but the problem of lack of needed related occupations are illustrated in table 3- skills will continue to limit the opportunities 1. Additional costs to the trainees are reduced in office work for many young minority workers. leisure, family, and personal time. These costs The 35 to 50 year olds who will constitute can be a substantial barrier, especially for those the largest group in the work force until after with child care and other family responsibilities. 2000 have completed their basic formal edu- Women, who are heavily employed in cleri- cation. Their additional training and educa- cal work and increasingly striving to move up tion will be achieved through on-the-job train- in organizational hierarchies, have a large stake ing or through their own efforts outside the in the changes in jobs and training. Women workplace. have constituted a large proportion of the in- Older workers also have a stake in chang- crease in the labor force in the past 15 years. ing skill requirements. There is no evidence Blacks have also been moving into office jobs to prove that age is directly and linearly rein the past three decades, increasing their par- lated to performance,” or to learning, but there ticipation rate in clerical jobs from 2.7 per- is less incentive for organizations to offer con- cent in 1950 to 10.2 percent in 1984. They, tinuing education and training to older work- too, have a strong interest in the changes ers as they approach early retirement age. Atti- occurring. Black and other groups will enter tudes on the part of managers that reflect their the work force at a faster rate than whites, own perceptions of a worker’s capabilities play and will account for about one-fourth of the a large part in determining what training is projected increase in the labor force to the year offered. While there is no evidence that intel- 1995.9 Hispanics will also make up a larger ligence, learning ability, memory, or motivation decline with age until very late in life,12 ‘Digest of Education Statistics, 1983-84, op. cit., p. 157. ‘Monthlev I.abor Retiew (Washington, DC: U.S. Depart- this perception can seriously affect the kind ment of Labor, Bureau of Labor Statistics, November 1983), p. 3. and amount of training and retraining that is offered to older workers. Table 3-1 .—Average Costs for Training Among Selected Office-Related Occupations

Costs (dollars) Hours Occupation Public Private Public Private Accounting ...... $488 $2,893 1,238 1,019 . . —.— Business administration 395 3,913 1,148 1,198 “’The Emplo.vment Situation: December 1982 (Washington, Secretary, ...... 541 2,903 998 1,043 DC: U.S. Department of Labor, Bureau of Labor Statistics, Computer programmer . . . . 551 3,473 1,276 704 Jan. 7, 1983). Clerk ...... 507 1,870 924 785 “U.S. Senate, Special Committee on Aging, The Costs of SOURCE U S Department of Ed;catlon National Cen!er for Educa!lon Stat[s- Emplo.ving Older Workers ( Washington, DC: U.S. Government tlcs Dfgest of Educ~fIon Stat6t/cs, 79831984, Washington, DC table Printing Office, September 1984), p. 4. 139 -Ibid., p. 59. Basic Skills Required for Most offices are now at the lower to middle Office Automation levels of automation; it is likely that the skills required are more complex at this time because Whether skills required to work in auto- of the many sets of rules that need to be learned mated offices are at a‘ ‘higher’ or ‘lower’ level to operate the new equipment, and because than those they are replacing, and whether of the changes in the work process and in rela- more or less training and education will be tionships between work groups. needed by future employees, has been the sub- Among clerical workers surveyed by Kelly ject of much debate. Services, Inc., 88 percent of the 613 respond- The basic skill requirements for all office ents believed that their skills were increased work can be obtained through the traditional by automation and that this would help them educational system. These include reading, obtain salary increases, even though only 30 writing, spelling, and some math proficiency. percent of them had achieved such increases Problem solving, abstract thinking, commu- since acquiring new skills. nications, and interpersonal skills are increas- Some experts15 challenge the popular belief ingly important. But studies have concluded that computer training should be basic in that one-fifth of the Nation’s adults do not schools in order to prepare students for the have adequate reading and writing skills to workplace, on the grounds that the “higher” function competently in the labor force. ” the technology, the lower the skill level re- Some office automation equipment will fos- quired. A BLS analysis indicates that only a ter jobs that require less skill than do manual small percentage of new jobs in the future will operations, but many jobs found in an auto- require computer literacy beyond what can be mated office require a higher degree of dis- learned on the job in a few hours or days. ” cretion, initiative, understanding, and crea- Others challenge the assumption that jobs re- tivity. A few specific skills become redundant, quiring use of a computer are automatically but many workers must cover a wider span transformed into “knowledge work. ” of work activity than before, often in a shorter Researchers seem to be in agreement that time span. the number of jobs available in the future re- The degree of automation achieved may de- quiring in-depth knowledge of computers are termine the skill levels required. In the fac- not a large proportion of projected new jobs. tory, levels of automation vary from a power However there is also general agreement that tool that is hand controlled to a robot that skills will change for many jobs (particularly identifies and selects appropriate actions and office jobs) and that training and retraining, corrects its own performance while operating. probably throughout the lifetime, will be re- The skills required can increase as tasks are quired for many workers. As lower level cleri- automated but only to a certain level. 14 When cal jobs are automated and eliminated, the re- the automation reaches higher levels the remaining jobs will require higher level skills. quired skill levels can decrease, as the worker To what extent employers are willing to pro- is required only to monitor the machine and vide this training on the job will depend on respond when the machine warns that some- the availability of workers who have obtained thing is wrong. the required skills elsewhere. From the work- ——. ers’ point of view, achieving these skills will ‘See Norvell Northcutt, Adult Functional Cornpetenc~’, Adult Performance Levels Project, Industrial and Business be critically important in obtaining employ- Training Bureau, University of Texas, Austin, 1975. “James Bright, “The Relationship of Increasing Automa- r tion and Skill Requirements, Employment Impact of Techno- ‘ ’For example, Douglas Noble, “Computer Literacy and logical Change, Appen&”x Volume II: Technology and the Amer- ideology, ” Teachers College Record, vol. 85, No. 4, summer ican Econom.v, National Commission on Technology, 1984, pp. 602-614. Automation, and Economic Progress (cd.), Washington, DC, “Henry Levin, “Jobs: A Changing W’orkforce, A Changing 1966, pp. 11-209. Education’?” Change, vol. 16, october 1984, pp. 32-37. ment and in making job changes throughout to be reasonably competent. However, there their lives; 81 percent of adult Americans feel are man-y jobs in insurance, banking, and else- that additional training will be required of where, in which the automated system is an them because of changes in the workplace.); integral part of the work process. Weeks or even months of training and practice may be Determining Training Requirements needed before an employee is fully competent.

The major factors to consider in determin- The organizational structure and environ- ing training requirements are the needs of the ment also has a bearing on training require- users (their current skill level and learning ments and success. Skill needs change as an needs level), the nature of the technological employee moves up in the hierarchy of the applications and products in a specific office, organization. Training managers to supervise and the characteristics of the job. workers in an automated office environment is a different process from training workers Users of automated office technologies in- to use the equipment. The immediate work- clude: 1 ) those currently unfamiliar with coming environment depends largely on the phi- puters; 2) those who currently use computers losophy of the organization’s management. as tools to perform specific tasks but are Management may or may not, for example, unaware of “how the computer works”; and consult employees about the implementation 3) those who program, perform systems anal- of office automation, the redesign of the work- yses, and do other work that requires under- flow, and training methods. standing of how computer systems work. OTA case studies indicate that an increasing Methods for Delivery of Training number of computer users fall between divisions 2 and 3; they are not computer pro- Research has demonstrated the importance fessionals and they usually employ software of hands-on experience in learning office auto- packages developed by others; but they may mation skills; how well people learn a new skill occasionally write small programs to improve depends heavily on how much “engaged time”’ the computer’s effectiveness as a tool. they spend on the learning,’n although experts differ as to whether this applies to less moti- The tasks to which office automation can vated trainees to the same degree as it does be applied include: 1) tasks that require only to the highly motivated. Hands-on and on-the- a well-defined, step-by-step procedure; 2) tasks job training assure that the trainee is “en- that require a limited amount of problem solv- gaged” during the learning session. ing; and 3) tasks that involve analyzing and manipulating data to achieve some goal. ‘g Self-teaching (and mutual learning) appears to be the most common mode of training, fol- For some tasks in the first category, train- lowed by home study. But there are some prob- ing may be brief—as little as a few hours. Even lems with self-teaching. The lack of formal, for tasks in the third category, learning to use guided instruction for all employees creates a computer as an effective tool may take rela- an unequal knowledge base, leaving some em- tively little time when the worker already has ployees at a disadvantage. For example, many other expertise. For example, an economist workers are not allowed training time on the learning to use a statistical package may re- job, and have responsibilities that take up their quire only a few days’ training and practice, time off the job, and so are prevented from learning even when they want to do so, “America at M’ork: The E\’olving Role of Proprietary t’ocational I+; duration, ITT Educational Ser\’ices, Inc., Indi- anapolis, I h’, 1982. Summary of a survej of a representatikre national cross-section of more than 1,000 adults. “Paul liarmon, “Training: Psychology Meets Technolo~’, ” -“Raymond Nickerson, “Information Technology and Ps?,- Computer Jl”orld, ~lay 2, 1983, p. 9. chology, ” Third Annual Houston S~mposium (New York: Prae- ‘Ibid., p. 12. ger Publishers, 1982), p. 203. Generally, when office automation equip- many organizations, as a place that employment is purchased, the vendor provides a ees may go to learn about automated technol- limited amount of orientation training, often ogies. These “user information centers” may in a classroom setting or through computer- offer a variety of services including—instruc- based training. The users must then experi- tional classes, computer-based training, hard- ment independently to determine what appli- ware and software testing, rating guidelines cations are best for their own specific tasks. for applications and prepurchases, and educa- Coworkers supply additional knowledge. tional and informational publications. The training is most often self-initiated by the Key workers are often used to train others worker seeking basic skills or further applica- in an office and assist them in acquiring office tions knowledge. These forms of in-house, automation skills. These “internal trainers” group learning are beneficial because people may receive formal training from the vendor feel rewarded when they meet new challenges or may develop expertise on their own. Then on their own. they must “interpret” the skills and tutor other staff members. Other office workers ben- Computer-based training (CBT) for learning efit by learning from someone who knows both office automation skills is increasingly avail- the business operations and the system. able. There are multiple choices of off-the-shelf equipment and systems, standard sets of equip- Beneficial as this short cut to formal train- ment and software programs that can quickly ing may seem, it may not be as productive and easily be adjusted to a variety of require- as it first appears. The internal trainers are ments. Some include optical disk and video often volunteers whose formal job descriptions text. As more manufacturers and vendors have do not take this role into account and no al- entered the field, the cost of CBT hardware lowance is made for it in their official work has decreased; it is no longer a prohibitive schedules. 21 They must balance the importance factor in most cases. In its 1984 industry sur- of their training activities against the possi- vey, Training magazine reports that 46.4 per- ble loss of productivity in their own assigned cent of all responding organizations use com- duties. While the key workers often enjoy their 22 puters for training. teaching role, they may or may not be good teachers and may or may not treat coworkers Computer-based training is popular because fairly in sharing their time and attention it reduces the two most commonly cited prob- among them. lems of training-cost and time. One expert reports that the use of CBT reduced course User groups are formed by users of a tech- length and that students trained on such technology to share information and to assist each niques achieved the same or a better level of other. Such groups are usually formed by performance than was achieved by those trained employees and are most often managed and in the longer conventional instruction courses. maintained by the users themselves. User A review of the literature found no evidence groups are also encouraged by equipment ven- that the use of computer-managed instruction dors. Outside help or intervention is rare. (CMI) or computer-assisted instruction (CAI) During meetings, users take on the role of caused students to do less well than control teacher, translator, trainer, problem solver, groups receiving other forms of instruction and student. 23 within the classroom. Two matters cause con- Centers for learning, testing, and exchang- cern when CBT is used—the fidelity of the ing information (often called user or technical training system in simulating the work envi- information centers) have been established in “Training, October 1984, p. 56. “S* Mildred D. Jarvis, “Computer Based Training: Les- “Tora 13ikson, Don Mankin, and Cathleen Stasz, “Individ- sons Learned, ’ Proceedings of the Human Factors Society— ual and Organizational Impact of Computer-Mediated Work: 28th Annual Meeting, 1984, pp. 515-519, also her reference to A Case Study, ” The Rand Corp., OTA contract report, March Orlansky and String’s report on the cost-effectiveness of CBT 1985, p. 42. in military training, 1979. Ch. 3— Training and Education for Office Automation ● 81

Phofo cred(t D~gfta/ fqu~~rnen( CorP Computer-based training ronment, and the quality of the written docu- oriented modes of delivery and because the mentation used in the training. The closer the students must often purchase their own hard- learning situation follows the work setting, as ware and software to study at home. However, opposed to merely presenting drill and prac- for basic education, TV-presented courses are tice exercises, the greater the applied learn- very cost effective. While sending employees ing that is acquired. Poorly written docu- to a training seminar or conference can cost mentation prevents trainees from advancing approximately $40 per hour, and a university through the stages of learning or achieving course can cost $7.50 per hour, a TV course the highest level of learning possible. costs only pennies per hour. Home study is a growing alternative to formal classroom-based training. CAI and CM I How Is Training Obtained? packages are offered, for example, by the Na- A survey of Fortune 1500 firms” indicated tional Radio Institute (NRI), which provides that companies, when automating offices, are technical correspondence courses. Cost is the ——.— -“ ‘America at ~’ork: The Management Perspecti\7e on restricting factor for home study because it Training for Business, ” I’IT Educational Senices, Indianapolis, is expensive to convert courses to technology- IN, 1983, p. 44. most likely to hire new employees with the these firms provide on-the-job training, most required skills (44 percent), switch employees often with vendor prepared documentation. into positions requiring no additional skills (40 The figure went up to 64 percent for the smaller percent), or reduce the number of employees firms surveyed. This agrees with the BLS sur- (40 percent). Thirty-six percent switched em- vey showing that 50 to 60 percent of workers ployees into positions that required additional gained qualifying skills on the job. training. Temporary agencies anxious to increase In addition to formal education institutions, their supply of trained workers are offering many public and private sector organizations, word processing training to potential employ- including unions, are involved in providing ees, often by means of computer-aided instruc- training and/or education, but demand so far tion and simulation. A standard for basic, outstrips supply. Some experts have ques- intermediate, and advanced skills has been de- tioned whether the capacity exists to respond veloped by one agency .28 This standard re- to all training and retraining needs. Many busi- quires that an operator with basic skills be ness organizations are increasing their budgets able to—set up the system, keyboard, create for training. A 1983 survey of 1,821 private documents, make minor corrections and proof, and government employers” showed that 1984 store and file text, recall/retrieve text, and training budget increases were predicted by print text. Advanced operators should also be 47.4 percent of the companies surveyed, but able to execute special software packages, de- 53.5 percent actually did increase those ex- velop graphics, write special programs, and penditures in 1984. supervise other operators. Although it varies considerably by indus- The Kelly surveys29 found in 1982 that 52 try, the dollars spent on nontechnical train- percent of the companies surveyed developed ing such as sales and supervisory skills, out- their own training programs and 51 percent weigh the dollars spent on technical training —.. — .-—— such as word processing, programming, and -“’Manpower-The Temp Agency–-Launches New Ap- proach to WP Training & Placement, ” Inside 14rord Process- electronic testing. Also, according to this ing, vol. 4, No. 6, June 1983. 26 survey managers were much more likely to “’The Kelly Report on People in the Electronic Office (Troy, receive training than lower level employees. MI: Kelly Services, Inc., 1982); The Kelly Report on People in the h’lectronic Office 11: How Office 1$’orkers Triew A utoma- Midlevel managers and first line supervisors tion (Troy, MI: Kelly Services, Inc., 1983); and The Ke]l.v Re- received an average of 32.5 hours of training, port on Peop)e in the Electronic Offke /11 (Troy, M 1: Kell~ executives received 28.3 hours, and profes- Services, Inc., 1984). sionals, 27.2 hours, while administrative and secretarial employees received approximately & 11 hours. Most of the companies surveyed offered both in-house and outside training with executives most likely to receive outside training and lower level employees most likely to receive in-house training. Only 31 percent of these companies engage in retraining of employees, usually lower level employees. In a survey of selected clients in Chicago, Price Waterhouse27 found that 42 percent of .- -.—- “Training Budgets ’84: In the Pink—and the Green, ” Training, october 1984, pp. 16-31. “’’’Training Magazine’s Industry Report, ” !ll-aining, Oc- tober 1984. “Price Waterhouse Office Automation Survey, ” Chicago, 1],, 1984, phofo Credl( ManPower /nc Ch 3— Training and Education for Office Automation ● 83 trained their own personnel. Fifty-one percent Formal company training programs reached used a manufacturer-developed training pro- 27 percent of computer systems analysts and gram and 32 percent used the manufacturer’s scientists, 30 percent of operations and sys- trainers. A 1983 survey showed that 34 per- tems researchers and analysts, 17 percent of cent of the nonmanagerial employees surveyed general office supervisors, 25 percent of insur- received their training from a vendor repre- ance adjusters, examiners, and investigators, sentative, 28 percent from a supervisor, 26 per- but only 4 percent of secretaries. Informal on- cent from a manual (self-trained), and 11 per- the-job training was received by considerably cent from an outside consultant or a class off larger proportions of the occupations shown the premises. in table 3-1. Professionals and managers in offices are About 55 percent of a sample of all workers not neglected in the market for office automa- employed in January 1983 indicated that, action training. Courses focusing on the upper cording to their own perceptions, they needed level employees’ need for training are becom- specific training to qualify for their current ing common. Many professionals and man- jobs. One-third of all workers had undertaken agers learn such skills on the job, through their skill improvement (see table 3-3 for some typi- own efforts, by means of a manual or by ‘‘just cal office-related occupations) since obtaining fooling around” with the machine. The avail- their current jobs. ability of simplified software in specific profes- Although only about 5 percent of all work- sional fields is making it easier for the profes- ers obtain training from high school vocational sional to be self-taught, and new ways to get programs, a large proportion of these are of- work done are finding their way into manage- fice workers. Thirty-five percent of secretaries ment training curricula, have received vocational training as have a Data on the sources of training for current large proportion of computer systems pro- jobs were developed by Carey and Eck at the grammers and computer systems operators. Bureau of Labor Statistics.’” Table 3-2 shows Thirty-five percent of the 5.9 million enrolled that in 1983, 70 percent of computer systems in public vocational education in 1981 -8231 analysts and scientists received training for studied office trades, and 23 percent of adult their current jobs in a school, mostly 4-year education participants studied business-related colleges. Fifty-seven percent of secretaries, courses.” Business/office school enrollment in- stenographers, and typists and 22 percent of creased 38.1 percent between 1975 and 1981, records clerks received school training. Seven- while vocational and technical schools and in- teen percent of all workers received qualify- stitutes suffered decreasing enrollments during training in 4-year (or more) college pro- ing that time. grams. Professionals working in offices, such as economists, statisticians, engineers, etc., The Adequacy of usually obtain their qualifying training in a Office Automation Training 4-year college. Business administrators and managers are also increasingly qualifying for A recent study” found that in the last 20 their jobs through college education. Employers years, the post-secondary education field was seem to be requiring higher qualifications for able to accommodate quite well to changes in many jobs as a more highly educated work demand for its services. However, secondary force becomes available. This reduces opportunities for less educated employees to be ‘Occupational Projections and Training Data (~~’ashington. promoted to higher level positions. DC: U.S. Department of I,abor. Bureau of I.al)or Statistics, 19X4). table c-l . Digest of L’ducation Statistics, 198.3-84, op. cit. Sue Berr~’n~an, The .4djustn]ent of l’outh and l“.’duc:]- hlax Care} and Alan F;ck, “HOW M’orkers (jet Their Train- tional Institutions to Tec’hn(jlogi(>till\ Generated (’hangps in ing. ” occupational outlook Quarter?’. t’ol, 28. wint,er 1984, .Skilf Requirements {J$-ashington, I)C: National (’omission for pp. 3-21. l~;mplo~’ment Polic?, Ala? 19851, p, 66. 84 Automation of America Offices —

-Cw-in-=tv=?mnlmmcclm

I=mcNeml

. . m ...... - . . . El: . . a). .L .—$; uc:. rd. C/r, 3— Training and Education for Office Automatlon ● 85

Table 3-3.—Sources of Training for Skills Improvement Among Representative Office-Related Occupations

Sources of trainlng (percent of occupatlonal employment)

ch &

37 25 8 38 22 7 16 16 8 9 12 2 26 16 7 26 11 1 16 25 2 7 11 3 13 19 3 6 12 2 25 23 6 13 23 5 15 26 4

vocational education in comprehensive schools terms other factors influencing the quality of was relatively unresponsive to changes in skill training. The quality is dependent on the qual- requirements. This problem may be exacer- ity of the instructional materials and design, bated by declining enrollments and the need the quality and availability of instructors, and to delegate scarce resources to the academic the range of courses that are offered. studies, for that there is greater demand in There is currently no legislation to regulate, these comprehensive schools. By contrast, pri- assess, or accredit the content or the quality vate and public schools that focused on voca- of the courses offered in the private and com- tional education are more adaptable to changes mercial sectors. Those who invest in such train- in skill requirements in the labor market. ing are at the mercy of the market. This lack Although the adequacy of any training or of quality control can be expensive and can retraining depends on the office, the job, and drain the resources of individuals and organi- the individual’s needs, commitment, and ca- zations. pability, it is possible to discuss in general

EDUCATION FOR OFFICE AUTOMATION TECHNOLOGIES

Computers have assumed such an important find themselves pressed for expanding the cur- function in the contemporary practice of busi- riculum: ness, industry, science, and scholarship that almost no student can expect to remain iso- ● by students– many of whom expect Iated from these tools. This imposes on edu- schools to provide them with access to cation the additional task of preparing stu- computing and instruction in computer- dents for jobs in which they will use the related subjects, and computer as a partner.34 Schools and colleges ● by the job market-because employers ex- ‘C-harles ‘~lossman, ,4ssociate Vice President, Academic pect applicants to have some basic com- Resource I]lanning, California State [Jni\ersit~. Fullerton, in joint hearings hefore the L]. S. C’ongr-ess, I louse, Information puter literacy before they arrive on the Technology in F;ducation, Apr. 2-3, 1980, p. 145 job. 86 ● Automation of America’s Offices —

According to a recent national study, com- The effectiveness of CA I is hindered by the puters in high schools are used two-thirds of lack of high-quality software. The Educational the time to teach children how to use a com- Products Information Exchange Institute, in puter (“computer literacy”), and 18 percent cooperation with the Consumer Union, evalu- of the time for drills and practice in various ated 600 pieces of educational software in 1984 subject matter. Results of a survey of 1,082 and rated only 5 percent of what was exam- elementary and secondary schools, conducted ined, or 30 programs, as “first-rate.”36 by the Center for the Social Organization of It takes about 200 person-hours to create Schools, the Johns Hopkins University, are 1 hour of conventional CAI. Work is being done shown in figure 3-1. It appears that relatively at the Advanced Computer Tutoring Project, little is being done to exploit the computer’s Carnegie-Mellon University, Pittsburgh, Penn- potential for teaching traditional subject mat- sylvania, to reduce the time required to deter in a more efficient, interesting, or effec- velop CAI.37 Attempts are also being made tive manner. Also, time is not spent on the to develop intelligent CAI, or ICAI, which al- computer to teach and develop office automa- lows for conceptual modeling and interactive tion skills for future jobs. instruction. Computer-assisted instruction (CAI)–the Computer-managed instruction (CMI) is an computer as teacher— has been introduced to automated technology used for the manage- improve the delivery and productivity of gen- ment of the school system and for managing eral education. CAI has been found to reduce the instructional flow in the classroom. It aids by 10 to 30 percent the amount of time stu- 35 both the teacher and student by providing pre- dents need to master a subject. CAI supple- and post-tests to evaluate advances in learn- ments the teachers’ efforts in the traditional ing levels, offering diagnostics, helping stu- classroom setting and provides specialized in- dents with assignments, and keeping student dividual instruction. records. The teacher need not be present for all testing, assigning, and recordkeeping. Cog- nitive diagnostics for learners can also be pro- “’Education Turnkey Systems, Inc., “Uses of Computers in vided by computer programs. Education, ” prepared for the National Commission for Em- ployment Policy, April 1985, p. 42 The hardware available for educational uses and teaching office automation skills has focused on using microcomputers. Video disks in the future may play an important role be- Figure 3-1 .—The Use of Computers in Elementary cause they allow for greater interaction in in- and Secondary School Education struction by simulating actual situations. Al- though information on educational software, 70 r 6A evaluations, and availability is published, the 60 price of these analyses limits access to this 50 40 information for many educators. Most school 40 districts lack the means to identify better soft- 30 24 ware, and in most schools only a handful of 20 18 teachers have the training to make effective use of computers.38 10

0 L [ L — Literacy Drill Games Other Functions ‘ hEdward B. Fiske, “Computers, In Most Schools, Have ❑ Elementary = Secondary Brought No Revolution, ” /Vew York Times, Dec. 9, 1984, p. 80. SOURCE Flqure derived from School Uses of Microcomputers ReDorts ‘“John R. Anderson, C. Franklin Boyle, and Brian J. Reiser, Fr~m a National Survey (working paper) Center for Social Organl “Intelligent Tutoring Systems, ” Science, Apr. 26, 1985, p. 228. zatlon of Schools The Johns Hopktns Unlverslty No 2, June 1983 ‘“Fiske, op. cit., p. 1. Ch. 3—Training and Education for Office Automation ● 87

Teachers and Computers ity,4’ Russell Aldrich of Apple Computer, who teaches at Golden Gate University in San The proportion of college freshmen choos- Francisco, says that: ing education as a major has declined from 22 percent in 1966 to 4.7 percent in 1982,39 Many times, a particular course was a good because of the job disincentives common to course, and a required course 5 to 10 years the teaching profession (low status, low pay, ago. But because technology is progressing rapidly, we are seeing so large a revolution in low-advancement opportunity, and diminished certain areas of office productivity, communi- psychic income). Teachers are being pursued cations process, and management roles, that by industry to fill training positions and they what was on the frontier 2 years ago is no are finding these jobs more rewarding than longer relevant today. What is lacking is a teaching. mechanism for higher education institutions to quickly and accurately evaluate the infor- The difficulties of competing for manpower mation industry pulse so that it can design and other resources in a rapidly growing high- and plan curriculum that anticipates educa- technology market are acutely felt by educa- tiomd needs and fills to them.42 (Emphasis added.) tors at the university level. Over the decade from 1970-71 to 1981-82, B.A. degrees in the The Office Systems Research Association computer sciences increased from 2,388 to (OSRA), in a cooperative effort between edu- 20,267, nearly 750 percent. Yet a large por- cators and business sector representatives, is tion of faculty positions are unfilled and the working to develop a model curriculum in office number of Ph. D.s graduating each year has systems for universities and colleges. “Office dropped substantially. The shortage of faculty systems’ is defined as the business function in the field of engineering and computer science related to the coordination and management has been attributed to the fact that industry, of the information resources of an organiza- by offering higher salaries and other incen- tion. Generally, this includes responsibilities tives, has been able to draw academics and for automated and manual office equipment, students away from universities.40 The percent- human factors, and office procedures. Accord- age of computer science faculty leaving for in- ing to OSRA, managers in the office systems dustry is twice that of any other field of engi- area are responsible for a business unit too neering. complex to rely strictly on a computer background or management techniques applicable to the traditional office environment. The Of- Curriculum Development fice Systems Model Curriculum Project was Efforts have begun to update curricula and begun in 1984 and is aimed at providing a include more courses in the use of computers, framework, and possible standardization, of but office automation and other technology- office systems curricula for all schools. OSRA related subjects are caught in the lag between plans to have a draft of their model ready in need, development, and implementation of new mid-1 985.43 curricula. This is especially obvious at the secondary and post-secondary levels of education, where these skills are most often learned. The rapid pace of technological change has complicated the delivery of appropriate courses. ————. In a report on office automation productiv- “Frank Freudberg, Office Automation Producti\’it~r: Lost En Route to the Promised Land (V1’illow Gro\’e, PA: Associa- “Center for Strategic and international Studies, 7’ec/mical tion of Information Systems Professionals, 1984), p. 14. Excellence in America: Incentives for Investment in Human ‘-Freudberg, op. cit., p. 15. Capital, Debra van Opstal (cd. ) (Washington, DC: Georgetown ‘{This information is based on correspondence and conver- University, October 1984), p, 1. sations with Bridget O’Connor, OSRA Vice President, Profes- “’U.S. Department of Education, National Center for Edu- sional Studies, Business Education Program, New York Uni\’er- cational Statistics, Condition of Education, 1984, table 2-12. sity, March 1985. 88 ● Automation of America Offices

Access to Education acy associated with wealth of the school, community size, region, gender, and race. To the extent that computer literacy and computer expertise are needed for success in Student enrollment in computer program- getting and keeping jobs, inequities in receiv- ming is much lower in schools that qualify for ing computer experiences in school are espe- Title I assistance (by having a large percent- cially serious for low-income, female, and ru- age of the parents with income below the pov- ral students. They translate into social and erty line) than in schools that do not qualify. economic inequities by giving some people After a survey of schools in 1983, Quality Edu- more effective tools for working and living in cation Data, Inc., reports that the 12,000 wealthi- an age of information technologies than others. est schools are four times as likely to have microcomputers as are the 12,000 poorest Each year the National Assessment of Edu- 44 schools. Rural and disadvantaged urban com- cational Progress (NAEP) surveys a strati- munities provide computer learning opportu- fied random sample of students aged 9, 13, nities at a much lower rate than other com- and 17 in approximately 700 schools in the munities.45 Among students at age 13, less United States. Data from the 1982 survey than 17 percent of the rural/ghetto students, show inequities in access to computer liter- but 32 percent of those living in “urban/rich” areas, reported use of computers in schools. Eighteen percent of junior high school students in small towns report school computer use, compared with 26 percent in large cities. Students living in the South are much less likely to have used computers in schools than students living in other parts of the country. Those in the Western States are twice as likely as southern students to receive such experience. Young women in secondary schools are less likely than young men to spend time with computers and to enroll in computer classes.46 Fe- males are less likely to take computer programming classes than males; one study in 1983 showed that 8 percent of the females and 14 percent of the males have enrolled in programming courses for at least one semester. The Women’s Action Alliance of New York City has devised several school-based strategies to overcome this problem, working with parents and teachers to increase girls’ use of computers. The results after a year of trial at a

“ iThese and the following figures are based on the work of Ronald E. Anderson, Wayne W. Welch, and I.inda J. Harris, Computer Inequities in Opportunities for Computer Literacov, University of Minnesota, based on work supported by the Na- tional Science Foundation under grant SED 8022125Ao I, 1983, p. 4. “As shown in studies by Anderson, Welch, and Harris, op. cit., 1983. Ch 3—Training and Educat/on for Office AutomatIon ● 89

middle school in Wisconsin, showed a 42-per- come differences are equated. Apparent ineq- cent increase in computer usage by girls.4T uity between black and white students in use of computers in schools and for enrollment in While the NAEP data showed some racial computer programming courses is derivative inequity in computer exposure in 1978, more of income and rural/urban differences. recent results reveal no significant difference between black and white students when in- Inequities in computer access identified here point to the need for attention at all levels of the educational system: National, State, community, district, school, and the classroom.

POLICY CONSIDERATIONS

Policies in Foreign Countries major roles. In Japan almost all efforts are by private companies. Japan continually retrains In some countries, training and retraining selected workers in the “lifetime employment programs are used as a basic instrument to system. Increasing “labor-market transpar- deal with specific labor market problems. The ency” or skill transferability, providing job successes and failures of foreign experiences referral, counseling, testing, training, and relo- are rich in lessons for shaping U.S. policy. cation assistance to workers, are regarded as The European and Japanese emphasis is on a matter of high public interest and the public strong vocational education as a basis for work employment service plays a major role in labor- life and on periodic training to keep skills up market adjustment policy in Europe and Ja- to date. Their philosophy is that these pro- pan,” grams serve not only low-wage workers, but a broad segment of the primary labor force.48 Existing Legislation However, the degree of government involvement differs among these countries. This section will present a summary of legislation and regulations related to education In France, the Law for Continuous Train- and training for automated office work and ing, implemented in 1971, committed the gov- some options for congressional consideration. ernment to provide training opportunities to adults and youth. In Sweden, where workers The potential for successful delivery of edu- are considered to have a right to training, the cation for office automation skills and knowl- government plays a strong role in adult train- edge already exists in the traditional education ing and retraining. A close coordination among system, most often addressed at the secondary government, employers, and unions helps en- and post-secondary level, where much of the sure that government programs mesh well Federal legislation is focused. Educational pol- with national needs. The flexibility of the sys- icies and legislation set the framework for ad- tem in identifying new jobs and in retraining dressing new and changing education needs. workers has reportedly added to the success The higher education delivery system in the in Sweden. United States is a complex matrix of private and public institutions that function with vary- Union involvement and training vouchers ing degrees of independence and dependence encourage wide participation in West Germany; on State agencies. The Federal Government the government and private industry both play direct role in institutional control has been limited to setting criteria for an institution ‘“hlichael l)odgursk~’, I,ahor Jlarket l’olic~’ and Structural Adjustment, paper prepared for the conference on [1. S, Indus- to participate in Federal programs or receive trial l’olic~’ and International Development, ()~rerseas I)e\’elopment (’ouncil, \f’ashington, 1)(2, NI ar. 4, 19/+3, p. 17. ‘Ibid. p. 26. 90 ● Automation of America’s Offices

Federal contracts. Various congressional ac- for the training of unemployed displaced work- tions have been taken to draw attention to ers in skills relevant to real employment op- selected national problems, to provide the fis- portunities in the area. These programs were cal resources needed to address these prob- not primarily aimed at office workers or at of- lems, to support research activities that have fice automation training. national and international implications, and Target groups for legislated training pro- to complement and supplement the role of par- grams have traditionally included about 8 per- ents and State and local governments in sup- cent of the population. These groups include— porting individuals and institutions. low-skilled adults (especially women and mi- Although there is no existing Federal legis- norities), disadvantaged youth, and residents lation specifically addressing office automa- of economically depressed areas. The gaps in tion education, there are related laws that public policy left by JTPA and similar pro- could provide a vehicle for delivery of office grams relate to: 1) the retraining needs of the automation education. large-middle tier of employed but at-risk workers; and 2) the basic skill needs of the 20 mil- Direct Federal involvement in training and lion or so functionally illiterate adults in the employment programs is considered to have work force who will not be touched by reforms begun with the Area Redevelopment Act (ARA) in elementary/secondary education, and whose of 1961, although indirect Federal involvement learning handicaps prevent them from bene- in training through vocational education pro- fiting from job-specific training.” grams began with the Smith-Hughes Act of 1917. The Manpower Development and Train- The Vocational Education Act (Perkins Act), ing Act (MDTA), enacted in 1962, focused as revised in 1984, provides focus on educa- training efforts on workers displaced due to tional needs at the secondary and post-sec- automation. The Johnson Administration’s ondary school level. The Perkins Act grants war on poverty brought about a wide range funds to States to make vocational education of work experience and training programs tar- programs accessible to all persons, but follows geted on the poor, minorities, and youth. The the current trend of placing greater control Comprehensive Employment and Training Act and responsibility at the State and local levels. (CETA), passed in 1973, absorbed many ex- Targeted groups include: isting work and training programs and was ● handicapped and disadvantaged persons, designed to operate primarily at the local lev- ● single parents and homemakers, el.50 CETA underwent amendments during its ● adults in need of training and retraining, history that expanded its purpose and reach. persons in programs designed to eliminate The Trade Adjustment Assistance (TAA) pro- sex bias and stereotyping in vocational gram reauthorized in 1981, also authorized education, and funds for training. The Job Training Partner- ● persons incarcerated. ship Act (JTPA) replaced all portions of CETA on September 30, 1982. This new program The act is designed to improve the quality shifted the focus away from direct Federal in- of vocational education programs in order to volvement in training programs and estab- give the Nation’s work force the marketable lished a business-government partnership in skills needed to improve productivity and pro- the provision of training for job skills. Train- mote economic growth. Under this act, the ac- ing programs are operated by the States in quisition of office automation skills may be combination with local-area governments and included in State programs for general voca- Private Industry Councils (PICS) and provide tional opportunities. Part E of Title III, “In- dustry-Education Partnership for Training in “’U.S. Congress, Library of Congress, Congressional Re- High-Technology Occupations, ” allows for search Service, Job Training Programs: Reauthorization and Funding Issues, by Karen Spar, Issue Brief No. IB82005, Feb. —.—.— 8, 1982. “’Perelman, op cit., p. 27. Ch. 3— Training and Education for Office Automation ● 91 grants to States to provide incentives for busi- the income tax exclusion for amounts received ness and industry and the vocational educa- by an employee under a qualified employer pro- tion community to develop training programs vided assistance program. Unless extended by for high-technology equipment, systems, and Congress, this act will expire at the end of 1985. processes. These programs are intended to be The act limits the exclusion to $5,000 of educa- closely tied to the local labor market and skill tional assistance furnished to an individual needs. during a calendar year. The act states that to the maximum extent practicable, funds will be utilized in coordina- State and Local Practices tion with JTPA to avoid duplication of effort Typically, State funding and support of edu- and to ensure maximum effective utilization cation has been related to economic develop- of funds under both acts. While the goals of ment. Several private sector industries and re- the two acts are similar, the manner of achieve- search and development firms have recently ment is different. The focus of the Perkins Act moved toward more direct involvement with is public vocational training and education, higher education institutions by starting joint while the focus of JTPA is on industry-spon- education ventures. While joint ventures are sored training. The two acts overlap where encouraged by some Federal laws, many busi- there is the greatest need for assistance. nesses have traditionally contracted locally for Funding for these programs is the key to training and education programs for their em- their success. However, the level of Federal ployees. funding for employment and training decreased States have assumed a greater role during by 49.7 percent between 1981 and 1984. Fund- the past few years, as they enact student assis- ing for elementary, secondary, and vocational tance programs to supplement declining Fed- education decreased by 8.9 percent during that eral support and shoulder the responsibility period. There were some increases for fiscal of Federal programs. As State policy makers year 1985— 17.5 percent for elementary, sec- have been confronted simultaneously with rev- ondary, and vocational education; and 14 per- enue declines and requests for additional funds cent for training and employment; but decreases for higher education as well as for other hu- are again projected for fiscal years 1986 through man resource investments, some have taken 1990 in training and employment functions.52 the unpopular course of raising taxes to pro- Federal aid to State and local governments vide additional support. Others have reduced for vocational and adult education decreased real levels of support for higher education in by less than one-half percent between 1981 and general and for research universities in par- 1984, but is projected to increase by 23.7 per- ticular. The funding pattern has been unique cent in 1986. Federal aid to State and local to each State. governments for employment and training Some States are making strong efforts to services was decreased by nearly 57 percent keep up with the new teacher and curriculum between 1981 and 1984, and is projected to needs. For example, the State of Minnesota increase by only about 13 percent by 1990, has made new office automation skills and com- with some fluctuations. If this trend continues, puter knowledge a high priority for vocational State implementation of this act will not be 53 education programs. Efforts are being made effective. first to increase the competency of teachers The Employee Education Act amends the through conferences and workshops on high- Internal Revenue Code to extend for 2 years technology equipment, office systems, telecommunications, and curricula design. An in- ~:xecutive office of the President, Office of hlanagement tegrated office system has been installed for and Budget, Historical Tables. Budget of the U..!. (;o~rernment, teachers’ hands-on experience. The system pro- Fiscal Year 1986, tahle 3-3 (19) and (20), 1985. I bid., table 12-3 (431 and (52). vides administrative assistance for teachers. 92 ● Automation of America’s Offices

The State’s vocational program will also in- ucation of employees is adequate to main- clude more opportunities for the adult and tain current levels of employment and part-time student communities. productivity; provide training grants and tax credits Another example of State activity is in to businesses that incur expenses for of- Texas, where “House Bill 246” will be imple- fice automation training. Also provide in- mented in all school districts in the 1985-86 centives to establish training programs school year. This law mandates computer liter- in office automation skills, including em- acy courses for middle school (seventh and ployment tax credits for employers who eighth grade) students and computer science train and educate workers. Employers classes for all high school students, as require- could be given the same kind of tax write- ments for graduation. The computer literacy offs for training that they get for plant course includes history, terminology, basic pro- modernization; gramming skills, and issues of computer use establish a program of Individual Train- in the society. Computer-related course credits ing Accounts (ITAs), similar to the Indi- are not required at the elementary school level, vidual Retirement Accounts. The ITA but many school districts are providing some may require employers and employees to type of computer awareness at that level. make equal contributions to a bank account; this money would not be taxed un- Policy Options til withdrawn. The account could be drawn by employees to pay for retraining when Federal actions that could encourage edu- needed. This would direct resources toward cation and training opportunities related to retraining needs of mainstream workers office automation might include: now being neglected. A key objection to this proposal is that workers may not be ● designate funds specifically for office au- able to choose and direct their own retrain- tomation education programs through ing in the best way, or appropriate pro- new legislation or existing vocational edu- grams may not be available; cation legislation that provides aid to expand the tax deductibility of training schools; for current and new occupations related ● increase funds for programs through ex- to office automation; isting legislation (e.g., the Perkins Act); change unemployment regulations to per- ● promote access for students in low-income mit receiving unemployment benefits dur- families and in rural areas, and for women, ing training. Encourage States to consider through direct funding and establishment those in training programs as still avail- of service programs; able for work, and to reserve parts of their ● increase Federal attention to maintaining State funds to establish permanent funds the capacity and quality of research in the for retraining; and Nation’s universities and the flow of new encourage union involvement in negotia- talent into academia; tions for skill training opportunities. In- ● provide career counseling, job guidance clude requirements that firms give notice programs, job search assistance and train- of plant closings in advance and aid in ing programs that do not penalize those the retraining of displaced workers. receiving unemployment insurance; ● encourage ties with the private sector Congress may determine to take none of the through cooperative educational efforts, above actions, making the conscious choice to curriculum development, and industry- preserve the status quo. Since there is no ex- based activities for office automation isting regulation of office automation train- skills; ing, the training available commercially is ● establish support programs or tax credits likely to grow, but with existing inequities in for small businesses to ensure that the ed- access and quality unchecked. Chapter 4 The Changing Nature of Office Work Contents

Case Studies ...... 95 The Individual and the Work Process ...... 96 The Nature of Office Work ...... 96 The Work Process ...... 97 The Information Age Office ...... 101 Task Change and Computer-Mediated Work ...... 103 Job Changes With Automation ...... 104 Management and Professional Jobs ...... 105 Clerical Jobs...... 107 Job Ladders and Mobility ...... + ...... +. 109 Organizational Structure and relationships ...... 111 Power and Access to Information...... 111 End-User Computing Power ...... 114 Communication ...... + ...... 4... 114 Dispersion of Work Activity ...... 116 Implementation ...... 117 Reason for Adoption ...... 118 Key Actors ...... 118 Adaptive Planning ...... 119 Users in the Implementation Process ...... 119

Figures. Figure No. Page 4-1. Possible Variations of Work Process for Word Processing ...... 98 4-2. Model of an Integrated Customer Service System ...... 102 Chapter 4 The Changing Nature of Office Work

Translating the capabilities of office auto- Next it discusses the possibility of structural mation technology into tangible operating ben- or cultural change in organizations that adopt efits for an organization illustrates effects at office automation. Finally, it reviews some of many levels—individual tasks, the work proc- the major factors that contribute to success- ess, organizational structure and culture, and ful implementation of office automation. quality of working life. These effects are at One point to be emphasized throughout this the core of the most interesting and pressing chapter is that the technology itself is not the issues related to office automation. Yet, they only factor—and may not be the most impor- are difficult to address because it is not possi- tant factor—in bringing about these changes. ble to give a simple or universal description Managerial strategies-decisions about the of the effects of automation on workers, jobs, organization’s goals and the role of people and or organizations. technology in achieving them—are of major This chapter looks primarily at the effects importance in determining how the technol- of office automation on the nature of office ogy is used. In many cases, it can be seen that work, on job content, and on organizations. outcomes are more dependent on how the tech- It examines the effects of office automation nology is used rather than on what specific on the work process; on specific tasks, skills, equipment is employed. and jobs; and on promotional opportunities.

CASE STUDIES

Many of the examples used in this chapter titative, others depend largely on qualitative, were taken from case studies of offices using participant-observer, or anecdotal information. automated equipment. In addition to the case studies in the literature, OTA commissioned Second, the organizations studied are all a number of small case studies, discussed in unique. Authority structure, corporate culture, more detail in appendix B. management philosophy, internal dynamics, financial health, and operating environment Case studies provide a rich source of detailed are different. To the extent that these factors information about the process of implement- of themselves cause certain outcomes, or mod- ing office automation and the possible changes erate the effects of technological change, it is in tasks, jobs, work processes, and organiza- difficult to state authoritatively that the re- tions. They allow one to view the intended and sult observed at one study site can be expected unintended consequences at many levels, and at other locations. in a variety of contexts. In this chapter, case studies are used to provide illustrative details Third, the technology itself is defined differ- about the effects of technology in a wide vari- ently from one organization to another and from one study to another. Office automation ety of organizations. These observations form the basis of some cautious generalizations about in one organization may be word processing the effects of office automation on organizations. capability used almost as a direct substitution for typewriters; in another it may be an Caution is needed in making use of case ma- extensive multiuser, multifunction operational terial for a number of reasons. First, the meth- system governing the production of the orga- odology and level of detail of published case nization’s primary product. Many possible studies vary widely. Some are highly quan- systems and combinations of functions, includ-

95 96 ● Automation of America’s Offices ing text processing, messaging and commu- others may not become evident for some time. nication, decision-support software, graphics, Thus, the findings of a case study may depend and numerous special purpose applications on where the organization was in the system may have a separate effect on the individual, life cycle when the study was carried out. There the job, or the organization. The choice of fea- are few longitudinal studies that follow the tures, the way the work process is organized same set of organizations over time. Even to use them, and the order and timing of sys- within one study it can be difficult to com- tem introduction, often make each case of of- pare ‘before’ with ‘after’ in an environment fice automation unique. where new technology is introduced gradually over a period of months or years, and where Finally, the time factor must be considered. systems are continually being upgraded or ex- User reactions and use of technology in a panded. “honeymoon” phase shortly after the equipment is up and running may be different from Despite these difficulties, case studies are what happens at a later date when new capa- often the only information available, and they bilities or limitations are fully understood. capture the detail necessary for understand- Some changes in the work process may take ing dynamic change within the organizations. place immediately after implementation, while

THE INDIVIDUAL AND THE WORK PROCESS

The Nature of Office Work til the final product is completed. Jobs are organizationally defined positions that are usu- Office automation has transformed office ally associated with a bundle of tasks and a work. Many offices are now semiautomated particular role with a defined set of responsi- environments where people and computers in- bilities in the work process. The work unit or teract. An “office, ‘‘ in the sense of a working office is a group of people of any size, with unit of people doing information processing responsibility for producing some identifiable work, is seldom a totally automated environ- final product. The work unit has a skill and ment. A fully automated procedure is one that task mix, that is, its members are at different does not require human intervention in order levels, have different roles, and perform a range to produce its final output. Automatic data of functions to produce their product. Skills processing falls into this category; all trans- are the attributes and knowledge that work- formation of information is internal to the com- ers need to perform useful activities. puter. But such fully automated procedures The impact of office automation on office usually make up only part of the work. Office work goes beyond changes in tasks. It can in- work usually involves a series of steps, some troduce new tasks, change the nature of the are fully automated, some are manual, and skills required, modify the work process, and some require interaction between people and ultimately can cause or be associated with computers. changes in jobs and in organizational culture For the purpose of this chapter, a task will and structure. This is at least in part because be considered any clearly definable activity computer-based technology bundles tasks in that forms a step in producing the final prod- a way that is different from the way they would uct of the office. Tasks may be performed by be done manually. When part of a process be- people or by machines. The work process is comes automated, the tasks that remain to the social and technical organization of work. be done by people may be different kinds of It is the way people and machines are orga- tasks. A new process is necessary for inte- nized to produce a result—the way informa- grating the work done by people and the work tion or materials flow from one to another un- done by machines to accommodate those differ- — —

Ch, 4— The Changing Nature of OffIce Work ● 97 ences. When the work process changes, the to make backup copies, design and use an elec- organizational structure, which defines the tronic filing system, and manage disk space roles and responsibilities of the members, can or diskette storage. Decisions about whether also change. these tasks will be handled by all users, by secretaries, by a system administrator, or by Take, for example, an office where a profes- some combination will affect the work process. sional researcher writes reports and a secretary types them. Introducing a word proces- There is also the possibility that the avail- sor can change the work process in a number ability of the technology will catalyze its own of ways. First, the nature of some tasks will use. In the experience of many authors, the change, and the new tasks will require differ- ease of editing a document on a word proces- ent skills. If the professional decides to use sor sometimes leads to additional rewriting, the word processor, then composing on a key- so that this step can sometimes seem to be board will require skills quite different from repeated almost indefinitely. those of writing by hand. Some skills needed Thus, even with this simple example it is for old tasks–like the secretary’s ability to possible to see how changes at the level of the neatly paste up final copies—may seldom be task, job, work process, and organization could used. take place as a result of office automation. Further, a change may take place in the process that governs the interactions of author, The Work Process secretary, and other people needed to produce the report. Partially completed drafts may no The bundle of tasks an individual performs longer pass between the author and the secre- describes the job, but the job is more than tary. The secretary may be left out of the revi- merely the set of tasks. The job is an organiza- sion procedure entirely, or at least the secre- tionally defined position. In many organiza- tary’s responsibilities may no longer include tions it is characterized by a job description the task of typing the author’s reports. that legitimizes the position. People identify with their jobs. The job defines a role within There are also some points where the tech- the work process and within the social struc- nology does not dictate a change, but allows ture; it is the point of articulation between the an opportunity for choice. The word proces- individual, the technology, and the organiza- sor could be given to the secretary instead of tion. Thus it is not sufficient to talk about how to the author. The author might still hand write office automation affects individual tasks. drafts, with the secretary keying in the docu- Jobs also change-the bundle of tasks, the role ment and making corrections on the word proc- in the work process, the position in the orga- essor. In this case, the word processor is more nization, and the self perception. like a simple substitute for the secretary’s typewriter. The relationship of author and sec- Division of labor is necessary when there retary, and the flow of work between them, is too much work for one person to handle. might have been altered only a little, although Once a division of labor is made, the work proc- the secretary will have to learn new skills. In ess governs the relationship of the various another scenario, that relationship might be workers to the partially completed product. severed completely. The secretary might be One way of looking at work process is as reclassified as a word processing operator and a continuum that runs from the most inte- moved to a newly created pool to key and cor- grated to the most differentiated. Figure 4- I rect drafts for many authors, as part of a shows five possible steps along this continuum change in the structure of the organization. for a word processing office. The most in- The use of new technology also introduces tegrated is the one where authors do their own new steps and new tasks. For example, use word processing and have complete responsi- of an automated system introduces the need bility for all steps in the process and control 98 . Automation ot America Offices

Figure 4.1 .— Possible Variations of Work Process for Word Processing

Integration of work process

. Group of authors, one operator ~ . Team of authors, team of operators

. Many authors, centralized WP pool with task specialization

Differentiation of work process

SOURCE Adapted from S M Pomfret, C W Olphert, and K D Eason, “Work Organ tzatlon Impllcatlons of Word Process ing, ” Proceed/rigs of the Ist /F/P Con/ererrce on f-/urnan-Corn~uter /n/eract/on (/N TERACT ’84A VOI 2, 1984, pp. 357-363 Ch. 4—The Changing Nature of Office Work ● 99 over the end product. The most differentiated There may be some fuzziness or overlap in is one where authors send work to a central- responsibilities and workers may be suffi- ized word processing pool where operators ciently familiar with the work of others to have specialized tasks–some key in text, some switch tasks occasionally, or take over in an proofread, some do corrections, etc. Between emergency. these extremes might be one-on-one relation- While the preindustrial style of organization ships between author and operator, or situa- works well in many contexts, it is often ineffi- tions where one operator or a team of opera- cient in handling large numbers of trans- tors focus on all stages of work for a particular actions. Thus, in the insurance industry, bank- group of authors. ing, or the billing departments of large firms, The basic concept of work integration or where high transaction volume is handled, differentiation can apply to a large extent industrial-style offices evolved. They are de- regardless of the level of technology employed. signed to organize people to serve the needs The example above works equally well if the of a large, rigid production system. The in- technology used is typewriters or quill pens. dustrial office is a production line. Workers There is a popular perception that advancing are differentiated into functional groups, for technology is associated with increasing dif- example-typists, log-in clerks, validation clerks, ferentiation and fragmentation of work. The and signature control clerks. Each group has manufacturing assembly line, with workers its own supervisor, and is responsible for some performing repetitive tasks, is a product of step in the processing of a transaction. Docu- the industrial revolution, not of earlier craft ments related to customer transactions flow manufacturing. Many people’s only image of from one functional area to the next, from one office automation is a picture of the central- “out’ box to the next “in’ box, receiving some ized word processing or data-entry pool. Al- incremental processing at each stop. though there has been a connection between The flow of work in an industrial office is computerization and fragmentation of work consciously designed according to principles in the past, other forces are also at work. Of- of “scientific management” first articulated fice automation technology offers the possi- for manufacturing by Fredrick W. Taylor in bility of reintegrating the work process in some the early 1900s. With Taylorization, a com- cases. plex production process is analyzed and divided Another way of looking at the work process into a series of simple tasks that can each be and the way it changes with automation is in performed quickly and efficiently. workers are terms of the three generic types of work proc- assigned to perform a single task, or a narrow esses in offices identified by Giuliano—pre- range of tasks, in a routine and repetitive way. industrial, industrial, and information age. ] The industrial form of work organization is a deliberate attempt to increase efficiency by The preindustrial form of organization is rationalizing the work process, and by reduc- used by many small and medium sized offices, ing individual discretion and variation. for example, a real estate brokerage or professional office. These work units may have a Because industrial-style offices were ones number of workers with different jobs, or roles, in which the work process had been consciously in the work process. However, each worker is analyzed and the individual tasks identified, to some extent a craftsman. Each works with isolated, and standardized, they were ideal can- some independence and performs a variety of didates for the early introduction of computers. tasks. There has been little effort to completely Certain tasks could be automated completely, standardize or systemize the work process. A making use of the computer’s ability to do variety of individual work styles is tolerated. large batches of calculations quickly. However, many manual tasks remained in preparing data ‘l’in~>~nt l;. (li~llimt), “The ~le~h~niz~ti~n of office W’ork, ” for the computer or making use of computer Scientific ,4merican, September 1982, pp. 149-164. output. 100 ● Automation of America Offices

Some have argued that computerization allows managers to speed the process of Tay- lorizing and routinizing office work in order to reduce costs and increase management control.’ Certainly, as automation began to be used in offices, it appeared that Taylorization and computerization were mutually complementary and interdependent processes, as computers were first introduced in those areas where manual processes had already been ‘industrialized.”3 Indeed, computerization seems to have intensified the factory-like nature of industrial- style offices. “Pools” of functionally similar workers existed before, but the trend toward Some offices are in factories. Note that some of these specialization increased with computerization, clerical workers are protecting their ears especially in routine data-entry tasks: from excess noise. Routine keyboarding was separated more sharply from other clerical functions and was often spatially isolated . . . As a result of the heightened fragmentation of work, processing personnel (both data processing and word processing) typically worked at machines all day. . . both the technical and social relations of work in these centralized word processing and data processing centers were factory-like. The work process was machine paced and often machine supervised; autonomy of the operator was minimal; competence measured by manual dexterity and speed.4 Taylorization is not limited to clerical processing functions. It isolates predictable tasks. Professional or managerial jobs can be ana- Photo credit M/chae/ Srmth lyzed and the more routine functions stripped Some offices where large numbers of transactions are away. Baran and Teegarden note that under- handled resemble factor~es, writing, the main professional occupation in the insurance industry, has been increasingly The industrial style of office organization rationalized. At one firm, this was done by works well for highly routine processes. It has splitting off the lower level functions and cre- some disadvantages, in dealing with ‘ ‘excep- ating a new clerical position called underwrit- tions” or nonroutine situations, and is usu- ing technical assistant to perform them. Re- ally not efficient for customized services. Some maining professional positions were divided experts also note that it is susceptible to pos- 5 sible long-term growth of overhead costs. For into specialty categorieso example, in order to deal with error detection For example, see Harry 13raverman, Labor and Monopolv and correction it maybe necessary to add more Capital: The Degradation of Work in the Twentieth Centur~’ steps, thus making the process longer and (New York: Monthly Review Press, 1974), pp. 293-358. more unwieldy. Generally, no one employee ‘Barbara Baran and Suzanne Teegarden, “Women’s Labor in the Office of the Future: Changes in the Occupational Struc- has all the information needed to correct an ture of the Insurance Industry, ” Department of City and Re- error, so mistakes may persist or build on one gional Planning, University of California, Berkeley, 1983, p. 11. another; papers might cycle through the sys- II bid. Ibid. tem several times before they are corrected. Ch. 4– The Changing Nature 0f Office Work 101

It can become difficult to provide quick, ac- Under the revised work process, each worker, curate customer service when work is proc- with the aid of a computer workstation and essed in a production line fashion. The proc- a client database, performs all the necessary ess of issuing an international letter of credit steps in processing letters of credit for a par- at one bank required 23 steps performed by ticular set of clients. The database contains 14 workers over a 3-day period, and generated all information related to the customer’s ac- stubs and carbon copies to be stored in a num- count. The customer service worker is the sin- ber of locations.’ A customer with a question gle point of contact between the customer and had a difficult time finding the one worker with the bank for corrections or inquiries. the right bit of information to answer it, and An illustration of the capabilities of an in- if a customer wanted a transaction to be mod- tegrated customer service system at Ameri- ified, the whole process had to start over again. can Express is shown in figure 4-2. customer Finally, for many workers, the endless repe- service representatives have the ability to deal tition of a limited range of tasks is boring. Yet with a wide variety of activities related to their information-handling tasks, even boring ones, cases. Working from the on-line database they usually require a high degree of focused at- can answer telephone inquires, send written tention. The result can often be a high error replies to mail inquires, make credit adjust- rate in the work, and a high turnover rate ments, stop automatic duns, or issue a special among the employees. These problems will be statement. In addition to the on-line database, discussed at greater length in the next chapter. the customer service workers have access to historical records stored on computer output The Information Age Office microfilm.

For some businesses, office automation of- Electronic reintegration allows a worker a fers the possibility of restructuring the work view of the whole operation and gives a vari- process in a way that reduces some of the prob- ety of tasks to perform. Roth factors are in- lems of the industrial style of work organiza- dicative of a “de-Taylorization” of work, and tion. This new approach has been called “post probably contribute to greater job satisfac- industrial’ or ‘‘information age’ and is char- tion, and in many cases, greater autonomy and acterized by an electronic reintegration of the responsibility. However, electronic reintegra- steps involved in producing a product. tion does not necessarily lead to greater autonomy, responsibility, or discretion. Because Electronic reintegration of work represents the work is dependent on the use of the com- a new approach to rationalization of work. In- puter, it can be subject to machine monitor- stead of attempting to make the work process ing and pacing. efficient by rationalizing each task and function separately, this approach seeks to ration- When a whole process cannot be handled by alize a whole procedure, perhaps along prod- one kind of worker, electronic integration can uct or market lines. This is possible because still be used to accommodate a decentralized the technology allows: 1) the integration of in- team approach to the division of labor. Some formation from many sources, and Z) the dis- insurance firms have created small teams of tribution of information to many locations. raters, underwriters, and clerical support workers to work on specific product lines. Workers A general example can be seen in the case that were formerly separated by function are of the bank mentioned above. Under the old now integrated into a team that serves a spe- system, each worker performed one or two cific market. Organizing the workers in teams steps in the processing of all letters of credit. rather than isolating them in functional groups allows them greater understanding of the whole production process and facilitates com munication. 102 ● Automation of America Offices

Figure 4-2.— Model of an Integrated Customer Service System

Case 3.. , o 1. Open a case 2. Post an action - 3. Create an adjustment ~ 4. Close a case [

i I L 1

SOURCE Jay W Spechler D[rector Performance Englneerlng American Express Co , personal communication 1985 ——.—.

Ch. 4— The Changing Nature of OffIce Work 103

Baran and Teegarden suggest that in the and to minimize labor costs. For more spe- insurance business, firms will tend to continue cialized products, those that require customiz- to use the industrial-style work process to pro- ing or responsiveness to individual client duce and distribute standardized products. needs, there may be more use of the team ap- Much of the work will be highly routine, and proach along with integrated office automa- the work force will consist of a shrinking num- tion systems.7 ber of low-skilled clericals and a few highly skilled professionals. With these products the goal is to reduce unit costs as far as possible ‘Baran and Teegarden, op. cit., p. 21.

TASK CHANGE AND COMPUTER-MEDIATED WORK

One commonly noted characteristic of work The rules by which information is prepared with computers is that they make work more or transformed also change with computer me- abstract and alter the worker’s relationship diation. Quantitative comparisons are easy for to the task. This is sometimes called a “com- computers to handle, qualitative judgments puter mediated” relationship, in that the in- are not. Thus, in the process of restructuring dividual must now do the task through the work to be done by computers, qualitative as- medium of the computer system rather than pects of information are either quantified or through direct contact with the objects of the lost. Correctness of data or procedures must tasks Using any sort of tool can, of course, be redefined to fit the formal logic of the com- distance a worker from direct tactile contact puter, and formal correctness can become more with an object. But most manual or power tools important than the relevance of information still allow the worker to remain cIose enough content. g Human judgments are often replaced to the object to get direct feedback about the with computer-based decisions and human er- condition of the object, the status of the proc- ror detection or correction become difficult. ess, or the need for adjustments. When a com- The language of the human-computer inter- puter is used, feedback is indirect, in the form face is different from human language, as well. of symbols generated by the information system. Although computers are becoming easier to Office work is already abstract. What is ac- use, they still require human operators to learn tually being processed is information. Yet from specific codes and procedural commands. Fur- the point of view of the worker, this informa- ther, even when these commands are similar tion becomes concrete because it is carried on to plain English, the formalized process by physical objects–signature cards, account which the computer works may be quite differ- ledgers, invoices, letters, reports, and checks. ent from human thought patterns. The human Most manual or mechanically aided office operator must learn to think and to perform tasks involve transforming the information by actions in a precise order that reflects the log- manipulating the object—copying, typing, up- ical sequence built into the software. dating, or signing it. When computers are in- The ability to think in a way that parallels troduced, many of these objects disappear computer logic is not a trivial intellectual dis- completely. The worker is left to deal with in- cipline, and represents a new way of working tangible information, which is transformed in for many people. For example, retrieving in- invisible ways inside the computer. formation from a computerized database re- —- ...— —— — ‘Further discussion is in Gunnar Aronsson, ‘‘Changed “See, for example, Shoshanah Zuboff, “New L$’orlds of Com- Work Qualification Structure in Computer-hlediated M’ork, ” puter-hlediated W’ork,” Har\”ard Business I?et’iew, September- National Board of occupational Safet~’ and Health, Solna, October 1982, pp. 142-152. Sweden, 1984. 104 ● Automation of America Offices

quires different modes of thought than find- Some observers note that the increased ab- ing a folder in a filing cabinet. Physical search straction can affect people’s understanding of is aided by physical aids to memory—thickness the work. Some managers in banking have of the file, color, a coffee stain on the corner. noted, for example, that new employees—those These do not exist in a computer-based file. who have only worked on the automated sys- There is only a name, constructed according tems—understand the system, but don’t nec- to rules inherent in the computer logic. A essarily understand banking. They think like search through a database requires use of the computer programmers instead of like bankers. right key words, in the proper relationship; As one manager said: otherwise the search may yield fault y results. Now you make an input and it’s gone. Peo- An example of how tasks change when comple become more technical and sophisticated, puters take over part of the process may be but they have an inferior understanding of the seen in banks. With computerization, the proc- banking business. New people have no idea ess of fabricating accounts, the principal activ- of the manual procedures so they never see ity of a bank, was made internal to the com- or understand the process, People start creating programs that don’t necessarily reflect the puter. These procedures had previously been spirit of the operation.lz done manually, or with the assistance of mechanical accounting machines. The role of Clearly employees acquire new skills, they human operators then changed from one of learn to interact with the computer, they may doing banking to one of surveillance of the never learn certain old skills. To the extent computer as it does banking. Adler points out that processes are automated and these skills that: are not needed any more, this may not be a problem. But, if the skills are still needed, ei- . . . a series of tasks formerly considered the ther at that job level or at another, there may very essence of bank work have been elimi- be costs to individuals or the organization for nated, including accounting imputation and allowing them to be lost. To continue the ex- adjustment, classification of documents, multiple entries of data, manual data search, and ample above, an understanding of basic bank- supervision by signature.10 ing practice probably is necessary for promotion above the lowest operational levels. To He also notes that new tasks were intro- the extent that employees do not gain it by duced. For example, “Accountants now diag- doing bank work, it may be necessary to ac- nose and rectify residues and anomalies listed quire it through formal training. by the computer system. New types of errors– and fraud—appear.11

‘ ‘Paul Adler. “Rethinking the Skill Requirements of New Technologies, ” Working Paper 9-784-027, Graduate School of — .— Business Administration, Ilarvw-d University, Boston, October -Shosh&ih Zuboff, “Problems of Symbolic Toil: How Peo- 1983, p. 17, ple Fare M’ith Computer-Mediated W’ork, ” Dissent. winter 1982, ‘‘ Ibid. pp. 51-61.

JOB CHANGES WITH AUTOMATION

Office automation can change jobs in many esses might be eliminated. This does not nec- ways. The automated system may completely essarily mean that the people are eliminated take over certain tasks. To the extent that cer- from the organization-they may be retrained tain processes become completely automated, and transferred—but particular positions no jobs that consist solely of those tasks or prol- onger exist. Ch 4—The Changing Nature of Office Work ● 105

On the other hand, office automation cre- databases and statistical software available ates new tasks, either supporting the system on their terminals to collect data and do anal- or related to new products made possible by yses formerly done by economists. ” Clearly, the system. These tasks may be incorporated new technology is not the only factor in cleri- into existing jobs or new jobs may be created, cal workers’ being able to take on new and as in cases where a trainer or systems special- interesting tasks; there must be management ist position is created after introduction of of- support for these job changes. fice automation. The question of whether changes related to Finally, very commonly, a change in the automation lead to an increase or a decrease work process modifies jobs through the addi- in skill is a hotly debated one. Often the terms tion or deletion of tasks. This can also result job “de-skilling” and “enrichment” are used in a change in the boundaries between jobs, to describe the changes. Enrichment usually transferring a task from one job to another. implies an increase in task variety, autonomy, Any of these changes may or may not be ac- skills acquisition, and other factors that are companied by a formal change in job titles, considered to contribute to job satisfaction. descriptions, or compensation. De-skilling usually means the removal of these features, usually through simplifying the work The boundaries between clerical and profes- and narrowing the number of tasks performed, sional and between clerical and managerial are and is usually associated with rationalizing showing interesting changes with office auto- or Taylorizing the work. Both de-skilling and mation. Some researchers have referred to this enrichment could be accompanied by job “en- redistribution of labor as the “clericalization largement, that is, an increase in workload. of professional work’ and the ‘ ‘professionalization of clerical work. IS Most clear is the shift It is clear that the impacts of office automa- of keyboarding tasks when professionals and tion will vary from one job to another. The managers acquire terminals or personal com- following is a brief summary of some generic puters. Individuals who would never have changes that have been seen to affect differ- typed their own memos and reports now rou- ent categories of workers. tinely draft them on their personal computers. Clerical workers have not stopped doing key- Management and Professional Jobs board work completely, however. Secretaries may work on documents at a later stage to Increasingly, computers are helping profes- revise, format, or print them, or they may still sionals get more work done by providing more key documents that professionals and man- and better information, by providing tools to agers choose not to key themselves. ~ever- aid in formulating professional opinions, and theless, many organizations have seen a de- by taking over some routine decisions. Tradi- crease in the amount of time secretaries and tionally, professionals and managers have high other clerical workers spend in keyboarding levels of autonomy in their work. ” Use of new or revising original material when profes- technology can give managers and profession- sionals and managers begin using the system. als better control over their time and even greater autonomy in their jobs. For example, By the same token, secretaries and some electronic messaging may reduce telephone other clerical workers have taken over tasks formerly defined as professional. In case ..—. ‘13.C. Amick and J. Damron, “Considerations in Defining studies of two different banking organizations, Office Automation: A Case Study in the Eastern Africa Re- for example, secretaries began using on-line gion of the M’orld J3ank, ” Human Computer Interaction: Proceedings of the Fimt USA-Japan Conference cm IIuman Cmn- puter Interaction. Gavrie] Sal\rend} (cd. ) (Amsterdam: ~jlse~rier ‘See, for emmple, tJ~an (lr~enk]aum, C>’dncl’ Pullman, and Science Publishers, 1984), pp. 439-445. See also app. B, “Com- Sharon szymanski. “F;ffects of office i4utomation cm the Pul)- puter hlediated \t’ork in Commercial Banking.” lic Sector W’orkforce: A Case Study, ” OTA contract No. 433- B. Kaplan, et al., Job Demands and Workers Health 7990.0, ~lpril 19/!5. (}$’ashington, DC: U.S. Go\rernment Printing Office, 1975), 106 ● Automation of America’s Offices

In another example, a manager who is pleased to get up-to-date information about factory operations through the office automation system, may be dismayed to find that the same information is available to a senior executive, who is therefore capable of more closely monitoring or second-guessing decisions. In this case, the use of the technology might lead to a reduction in autonomy for the lower level manager. “Knowledge engineers” have been attempting to identify the skills, information, and expertise that go into managerial and professional judgments and to incorporate these into software. The results are a variety of computer- based models, expert systems, and decision- support systems. Some analysts have expressed fears that computer-based models are making professional and managerial work more routine. There are also fears that some people are going too far in allowing them to replace human call-backs, or in some cases, the number of judgment. Human judgment is not perfect, but meetings. Managers can get up-to-date infor- its imperfection is generally recognized and mation on factory operations or business activ- expected. Many people have higher expecta- ity by accessing on-line databases within their tions of computers, and sometimes a misplaced companies. They may be able to manipulate faith in their accuracy. A computer-based these data, to do “what if” studies to deter- model, no matter how good, is only a partial mine the probable outcomes of their decisions representation of complex relationships, and before actually making them. Managers and its internal assumptions, theoretical biases, professionals can avoid the need for outside and mathematical quirks can produce results data processing or other expert help by using that are not consistent with the real world. spread-sheet software or information data- Overconfidence in the effectiveness of com- bases at their own terminals. They can pro- puter-based models, some believe, can lead to duce polished reports on their own printers neglect of other forms of research that were, without a secretary or a graphics artist.16 before computerization, the basis of expertise. Skill in these areas is still important as long Along with these advantages, there can be as the model is incomplete.17 some drawbacks as well. The ability of computers to give the wrong Greater autonomy, for example, can have its disadvantages. When managers and profes- answer to six significant figures is sometimes called “the tyranny of illusory precision. ” Its sionals demonstrate less need for a secretary danger to professionals and managers has to do their typing, they may lose the secre- probably been exacerbated by the growing use tary entirely, even if they still want one for of computer graphics. Advertisements by com- other duties—or for a status symbol. puter companies rightly tout the greater per-

‘“Linda Sandier, “Securities Risk: Wall Street Is Finding “’Alexia, Martin, Office Automation: Catalyst for Change, Its Trusty Computers Have Their Dark Side, ” Wall Street Jour- SRI, International, 1983, p. 9. nal, Dec. 4, 1984, p. 1. Ch. 4— The Changing Nature of Office Work . 107 suasiveness of good graphics (the CEO adopts on how the technology is implemented in a par- the proposal illustrated by manager A’s color- ticular organization, rather than on the tech- ful pie charts, but he throws manager B’s nology itself. laboriously typed tables into the trash). How- For many clerical workers, both quantita- ever, slickness of presentation and effective- tive and qualitative data show that workload ness of results are not necessarily related. has changed following the introduction of of- Some professionals have expressed fears fice automation. The work pressure scale from that too much use of computer-based infor- the NIOSH study shows that the introduc- mation or decision-support software is limit- tion of a computer terminal has led workers ing creative problem solving. Much of the value to report greater work pressure. In most cases of a professional judgment is that it weighs this is because management choice has been many factors, many of which are unquantifia- to redesign work according to the “industrial” ble, or even ambiguous or fuzzy. Someone who or production-line model. The most common formulates a professional opinion gives weight scenarios are those of the secretarial worker, to the nonquantifiable information in a “gut the data-entry clerk,20 or the directory assis- feeling” based on experience. Information tance operator.21 In each case, rationalization available through a computer database may of the job fragments it into its component be more complete than information accumu- parts. A secretary, for example, who previously lated through other means, but it is also did filing, typing, answering phones, and a ‘‘perfect “-ambiguity has been removed. Some number of nonroutine tasks may end up only writers have suggested that ambiguous situ- doing word processing. ations provide a “free space” for creative think- Work pressure may also increase when the ing that is fundamental to professional work.18 work is less paced by the person and more by The problem may be short term. Continued the computer terminal. In the extreme case, research and development along with practi- the directory assistance operator may be ex- cal use will further demonstrate both the po- pected to take a call every 30 seconds, with tential and the limitations of computer-based calls continually forwarded to the operator by tools in aiding decisionmaking. If professionals the computer. It is this combination of pacing and managers who put too much reliance on and specialization that leads to increased work- computer systems make more mistakes than load.22 those who rely more on traditional skills, they Whether the worker’s autonomy and con- will presumably prove less effective over time. trol are increased or decreased on the job can depend on how the automated system is de- Clerical Jobs signed. This can be seen, for example, in some It is in the area of clerical jobs that most of the automated collection systems being used studies of the effects of office automation have focused, and it is here that many of the im- -“Michael J. Smith, B.G. F. Cohen, and 1,.\t’. Stammerjohn, 19 Nevertheless, it is hard “An Investigation of Health Complaints and Job Stress in Video pacts seem apparent. Display Operations, ” I{uman Factors 24:4, 1981, pp. 387-400; to generalize, because so many impacts depend Gunn Johansson and Gunnar Aronsson, “Stress Reactions in Computerized Administrative Work” Reports for the Depart- “Zuboff, op. cit. ment of Psychology, University of Stockholm, Supplement 50, Exam les include: Mary C. Murphree, “Rationalization 1980. and Satis Faction in Clerical W’ork: A Case Stud~’ of W’all Street “Note the example cited in B.C. Amick and D.D. Celen- I,egal Secretaries, ” Ph.11. dissertation, Department of Sociol- tano, “Human Factors Epidemiology: An Integrated Approach ogy, Columbia University, 1981: Evelyn N. Glenn and Rosalyn to the Study of E{ealth Issues in the Off ice,” Human Aspects 1,, Feldberg. “Proletarianizing Clerical L$’ork: Technolo~r ond in Offi”& A uhxnation, B,G. F. Cohen (cd. ) (Amsterdam: I+; lse\’ier organizational Control in the Office, ” Case Studies in the Z.a- Science Publishers, 1984), pp. 153-166. bor Process, Andrew Zimbalist [cd. ) {New York: hlonthly Re- -R. Feldberg and E. Glenn, “Technology and L%’ork Deg-ra- ~’iew Press, 1978), pp. 51 -72; and Robert A. Arndt, and 1,arr~ dation: Effects of Office Automation on M’omen Clerical kf’ork- Chapman, “ Potential Office Iiazards and Controls,” OTA Case ers, ‘Illachina J,’.Y. Lkw: Feminist Perspectit’es on 7’echnolog~. Stud?, 1984. (New York: Pergamon Press, 1984). 108 ● Automation of America Offices

both by private firms and government agen- vidual decisions. In one OTA case study site, cies. Often these are implemented in a way a New York City office, secretaries organized that reduces autonomy. Under a manual sys- themselves to solicit overflow typing from tem, the individual worker had some discre- other departments. tion about which account to pursue, when to In the case of one Wall Street law firm, le- start a new file, or how often to call. Many gal secretaries found they were losing their automated systems make all those decisions. keyboard work to the word processing pool The system makes other decisions as the work- and their lawyering’ tasks to paralegals. As er keys new information into the files during a result, their work is generally now limited telephone calls with the delinquent accounts. to performing “primarily those nonroutine The worker’s individual assessment of priori- tasks that involve social skills, time emergen- ties or intuitive judgments of which people are cies, and multiple contingencies, ” such as field- most likely to respond to extra cajoling being phone calls, gatekeeping, coaxing rush jobs come less important. The automated system through the bureaucracy, etc. The firm has determines when, how often, and how long each made a deliberate effort to reduce the number call should be. Sometimes the worker has no of secretaries and to eliminate the one-sec- understanding of the whole case, except through retary-one-attorney relationship. Increasingly, the notes provided by the system. Under a secretaries work for more than one attorney manual system, a worker ends each day with or as members of small clusters in teams with a big pile of completed work and a sense of other secretaries. 23 accomplishment; a machinepaced system may continue to send new work at the same rate, The allocation of tasks is a management de- no matter how much is accomplished. cision. In the case of the law firm, business and economic factors moved management to On the other hand, if designed differently, allocate tasks in a new way. A centralized word the same sort of system can maintain worker processing pool appeared to minimize capital autonomy and control while providing the ad- costs and ensure maximum use of equipment. vantages of a computer-based information sys- Technology helped make the reallocation of tem. For example, work can be bundled so that tasks possible, but did not guarantee it. The one worker, or a team of workers, follows a other change in the legal secretaries’ work had certain set of accounts from beginning to end, more to do with accounting procedures than and has the satisfaction of seeing the big pic- with technology; “lawyering’” work done by ture in each case. If the system is modifiable paraprofessionals is billable to clients, but the by the user, so as to give some discretion about same work done by legal secretaries is consid- timing and duration of tasks or to allow use ered an overhead expense. Economic factors of individual expertise, it can offer the best motivate both the acquisition of new technol- features of both the manual and automated ogy and the assignment of work. systems. Autonomy is not directly tied to the technology and is related to characteristics of For secretaries at one major bank the in- the organization and the work process prior crease in workload relates not to fragmenta- to automation. tion, but to the addition of new and interesting tasks. When personal computers were Changes in the work process can lead to a introduced into their work unit their keyboard- redistribution of tasks, which may either re- ing duties did not decline; the unit withdrew duce or increase workload for clerical work- from the typing pool it had used previously, ers. Where professionals and managers have making secretaries responsible for more key- begun to do most of their own keyboard work, or where keyboarding is sent to a word proc- -’Mary C. Murphree, “Brave New Oifice: The Changing essing pool, secretaries may find their typing World of the Legal %cretary, ‘‘ Jf.y Trouble,s Are Going To Have Trouble With Me: Everyday Trials and Triumphs of 14romen load considerably reduced. How this change 14’orkers, K. Sacks and D, Remy, (eds.) (New Brunswick, N,J: is handled depends on managerial and indi- Rutgers University Press, Douglas Series, 1984). Ch 4—The Changing Nature of Office Work ● 109 boarding. At the same time, the secretaries both internal and external labor market con- discovered that the statistical packages and ditions. In many industries, internal job lad- databases available on their terminals allowed ders have been significant factors in the past. them to do some types of work previously done Capable and ambitious workers could learn the by professionals. They found this work an en- industry from the ground up, coming in as cler- joyable challenge and do not wish to give it ical workers and working their way up through up, even though it increases their workload. 24 lower level supervisory (or paraprofessional) jobs into management levels. In the insurance Job Ladders and Mobility industry, for example, clerical workers might become raters and later underwriters.” Changes in job content may affect career mobility within organizations (internal labor Some technologies provided a natural learning sequence so that workers learned on the markets) as well as mobility within the econ- job how to carry out more complex tasks and omy at large (external labor markets). In many operations. Firms that anticipated future firms employees have the possibility of mov- growth wisely saw to it that there were pools ing up job ladders within the organization— of workers at the various intermediate skill acquiring new skills, assuming greater respon- levels available for promotion so that expan- sibility, and receiving higher compensation. sion could be smooth and free of external la- The development of these opportunities and bor market constraints. ” the cultivation of this internal labor market The insurance industry traditionally selected has been very important to some firms. Some and trained managers from within the indus- indeed consider the experience of working up try, usually from within the firm. In other in- through the ranks, with its concomitant un- dustries too, such as retail trade, the internal derstanding of internal operations and dem- job market was the most significant and em- onstrated loyalty to the firm, to be more im- ployers provided much formal and informal portant than any amount of outside training. training for lower level employees. Although These firms may have a policy of filling cer- the messenger-to-manager or clerk-to-CEO tain positions only through promotions rather paths were trod to the end by very few, the than from outside. possibility that a combination of diligence, Both company policy and the shape of the striving, and luck could take one to the top job ladders may change over time due to any was a powerful motivating factor. number of factors, including technological Some researchers have suggested a grow- change. What will be the impact of those ing trend in recent decades to externalize both changes directly related to office automation, training and recruitment. In other words, em- or to the changes in work process or job defi- ployers are depending more on lateral recruit- nition permitted by technological change? ment of managers and skilled workers trained On the one hand, the fragmentation of work in colleges and business schools. 27 This also into a multiplicity of narrowly defined jobs has traditionally aroused concern about the ‘ It has been pointed out b~T se~’eral researchers that this availability of “good” jobs. On the other hand, job ladder worked well only for male clerical workers before the prospect that office automation may lead the earl~’ 1970s; women clerical workers seldom made the climb. to more standardized jobs raises concern about Under pressure of equal opportunity initiatives this became a significant job ladder for women in the 1970s, but is now potential polarization of job opportunities into said to be truncated by the automation of rating and mu tint’ low skill, low wage and high skill, high wage underwriting. jobs with breaks in the job ladder between -*Eileen .Appelbaum, School of Husin(lss tldnlinistrati(~n, them. Department of Economics, Temple Universit?r, personal communication, Feb. 5, 198,5. See for example, ‘rhierr~’ ,J, No~’elle, “Plmplo~n~ent and The import of diminished mobility must be Career opportunities for W’omen Minorities in a Changing I~con- judged relative to the context, which includes om~’: The F: xperience of I.arge and Nlediurn Sized Firms, ” Con- ser~ at ion of I IU man Resources, (’oIu mbia I Ini\’ersi t?’, ,J anu ar}. ‘f~.{’. .lmick and J. I)ammn. op. cit., pp. 1:~$.1 45. 19N3, 110 ● Automation of America’s Offices —

applies to lower level workers, because of the industries are not necessarily generalizable to longer years of schooling for the general pop- general office circumstances, where initial ulation and the growing availability of vo- staffing patterns are different and motivations cational schools and community colleges, em- regarding job design are also different. In ployers can rely on the public sector for training many general office environments with lower once provided within the firm. For those who levels of clerical employment (the extreme be- cannot or do not get that training and educa- ing the one-secretary office) office automation tion—for reasons related to socioeconomic con- is not driven as strongly by the objective of ditions, culture, talents, or the driving neces- immediate reductions in force. In many such sity of earning a living early in life—a critical offices, there is perhaps a stronger need for alternative path to better jobs is being eroded. quality improvement, greater timeliness, and workload leveling. The result could be a greater Office automation could further weaken and tendency for job enhancement and possibly truncate internal job ladders by completely improved internal job ladders. automating some of the jobs that provided the intermediate rungs, and by encouraging em- Many people advance their careers by mov- ployers to rationalize, simplify, and narrow ing from one organization to another. Thus, tasks so that workers learn about only smaller the external labor market is also a source of and smaller fragments of the total work of the opportunity. In professional, technical, and organization. This also makes the individual managerial occupations, advancement by mov- worker less and less valuable to the employer ing between organizations, as well as by mov- since he or she can be readily replaced by others ing within them is relatively common. A study who require only the briefest training, or have of occupational mobility noted that most job already learned the same simple procedures changes during the study period occurred in other firms or other industries. Their skills within the same major occupational group, are, in other words, fully standardized. especially for both male and female professionals. 24 Indeed, mobility of these personnel This tendency from one perspective in- seems to be the foundation for the employ- creases the mobility of workers, who can move ment agency and placement business. relatively easily from one firm to another or from one industry to another with fully trans- Although some people can advance readily ferable skills. But it does not increase their via the external labor market, some groups upward mobility at the same time. If the sup- find that more difficult. In many cases, a ply of lower level jobs shrinks and the supply change in jobs does not reflect advancement. of higher level jobs increases, such workers It was noted in the previously cited occupa- may not benefit because the higher level jobs tional mobility study that a relatively high are likely to be filled laterally, with people who percentage of women who had recently moved have had the benefit of higher education–or into manager or sales positions had previously more recent education. been clerical workers. However, the largest group of women changing jobs were those who Some researchers believe these trends are moved from one clerical occupation to another.29 leading to a polarization of the labor force into For lower level clerical workers, advancement low skill, low paid jobs and high skilled, high through job changes is likely to require for- paid jobs, with few opportunities in between. mal, external training, if on-the-job acquisi- Empirical evidence regarding any economy- tion of skills needed for higher level positions wide trend toward job polarization within orga- is diminished. A reduction in intraorganiza- nizations gives conflicting signals. Polariza- tion of jobs has occurred in such office-oriented industries as banking and insurance; exam- ‘KEllen Sehgal, “occupational Mobilitj’ and Job Tenure in ples are provided in previously cited research 1983, ” A40nthly Labor Retiew, October 1984, pp. 18-23. by Baran and Appelbaum. Conditions in those ‘qIbid. —

Ch. 4—The Changing Nature of Office Work 111 tional career ladders is a shift in training bur- cation and training is uneven; job opportuni- den from employer to employee. That burden ties may be increasingly tied to social class is aggravated inasmuch as access to good edu- or economic means.

ORGANIZATIONAL STRUCTURE AND RELATIONSHIPS

Changes in the structure of organizations power include such things as control over re- related to introduction of office automation sources, information, critical technical skills, can be influenced by economic, environmental, or coping capability .30 As control over the com- or cultural considerations, in addition to tech- puter offered senior management many of nology. Managerial strategies-upper level de- these things, some researchers predicted that cisions about the organization’s goals and the computerization would increase the centrali- role of technology and of people in achieving zation of decisionmaking power. them—are probably the major considerations. These studies were done for the most part Formal structural changes (i.e., something in the era of mainframe computers. However, that would be noticed on the organization even in the age of personal computing and dis- chart) might take place during implementation tributed processing, there may be reason to of office automation or shortly afterwards, per- believe that integrated information systems haps reflecting a change in the work process. can aid in the centralization of organizational For instance, in some firms, the creation of power. Possible routinization of middle man- administrative centers and the aggregation of agement work, through dependence on com- all support personnel in word processing pools puter-based information systems and decision- accompanied the decision to adopt office auto- support models, was discussed earlier. Some mation technology. On the other hand, change researchers have pointed out that any worker may not be reflected formally at all, but may whose job becomes more routine becomes less only be seen as changes in communication pat- powerful, less able to offer a unique contribu- terns or in power relationships between groups tion to the organization. While middle man- or departments. agers may retain responsibility y for making certain decisions, their range of choices could Organizational effects often take place over become more rigidly circumscribed by the as- a period of time, as part of an evolutionary sumptions inherent in their decision-support process. As familiarity with technology and system. Their authority could be accompanied its capability grows, structural changes may by increased supervision and control, as higher be introduced that allow the organization to level management will have access to the same take better advantage of those capabilities. 31 information and decision aids. Another ex- New product lines made possible by the tech- pert has suggested that “paradoxically, [cen- nology may emerge, which in turn give rise tralization] may be manifested by locating de- to new work groups or departments. cisions at lower levels but controlling decision outcomes through the provision of perform- Power and Access to Information ance records. “32 It has been suggested that Early research on the computerization of the widespread use of integrated office auto- organizations suggested that introduction of “’Jeffrey Pfeffer, Power in Organizations (Nlarshfield, MA: computing appeared to change power relation- Pitman Publishing Inc., 1981), p. 274. ships, and a central preoccupation of research “M. Lynne Markus, S-vstems in Organizations: Bugs and in the 1970s, was whether computers led to Features (Boston, MA: Pitman Publishing Inc., 1984), pp. 52-53. ‘&Daniel Robey, “Computer Information Systems and Or- growing centralization of power among upper ganizational Structure, ” Communications of the .4CAI, October level managers. The sources of organizational 1981, pp. 619687. mation systems reduces the need for middle floor. (See appendix B.) While access to up-to- management and could ultimately lead to a date information is partly responsible for this flattening of some organizational pyramids .33 shift, even more important is the ability to act on information. Under the new system, The concept of centralization is too simple only production-support staff have the author- to describe all the possible changes in power ity to override the system when the automatic relationships that might result from the in- response would be inappropriate. Because of troduction of office automation. Organizations the complexity of the work and also because are not monolithic; different departments, of some conceptual problems in the system’s work groups, or factions may be affected dif- design, such conditions arise frequently. Pre- ferentially. viously, factory supervisors might have dealt A set of case studies found that introduc- with exception conditions on their own author- tion of automated production scheduling sys- ity, but now they must request permission tems into Danish plants altered the power rela- from production support. tionships among management groups because On the other hand, where shifts in relative of differential access to information. The plants power are inappropriate to the “corporate cul- had a matrix organization, with major deci- ture” of any organization, management has sions being made by interdepartmental teams the option of reinforcing existing lines of au- of production planners, production managers, thority and modifying the automated system and plant managers.34 The new computer-based to ensure that change does not take place. production planning system was ‘owned’ and mainly used by production planners. It seems One example is that of a military organiza- to have concentrated up-to-date knowledge in tion that replaced its manual logistics system their hands, thus giving them greater power with a computerized one. Under the old sys- over production decisions and higher status tem, senior officers received requests for equip- as compared to production managers and plant ment transfers and had junior officers to mangers. These shifts of influence were evi- compile a detailed report on which to base a dently unintended by the designers of the sys- decision. The junior officers gathered informa- tem. One expert35 in interpreting the same tion for these reports through written docu- study, points out that this concentration of ments and through telephone contacts with power caused the matrix arrangement to lose a network of supply officers at other installa- some of its anticipated effectiveness, although tions. With the new system, the junior officers it was still retained, largely for symbolic or worked at computer terminals with on-line ac- ideological reasons. cess to information about the location and status of equipment, a decision-support system In one of the OTA case studies, Aircraft In- to calculate least-cost routing, and the means struments Plant, the introduction of the MRP to implement transfers. Because the junior II planning and scheduling system seems to officers had timely and complete information, have given greater power to production-sup- people began making requests for equipment port office workers while taking some discre- directly to them rather than going through tion away from the supervisors on the factory proper channels, and the junior officers some- ‘ R~~f ‘T Vv’~and, “Integrated Communications and Wrork times could not resist the temptation to re- h~fficiency: Impacts on organizational Structure and Power, ” spond, even though they did not have author- paper presented at the International Communication .Associa- tion ,4nnual Con\rention, Honolulu, Hawaii, hlay 22-27, 1985, ity to do so. Senior officers attempted to have p. 16. the new system removed. In the end it was ‘IN. Bjorn-Anderson and P. Pederson, “Computer Systems retained, but it was redesigned so that junior as a Vehicle for Changes in the Management Structure, I nfor- mation Systems Research C~roup, University of Copenhagen, officers were unable to take action based on 1$’orking Paper 77-3, 1977. Cited in Rob Kling, “Social Analy- their decisions.36 ses of Computing: Theoretical Perspectives in Recent Empiri- cal Research, ” CoI]]p~ltingSLlr\re\r 12 (March 1980), pp. 61-110. llobey, op. cit. “Markus, op. cit., p. 74. Ch 4— The Changing Nature of Office Work 113

Pho [o cred(f E?(// Ke//ey Commu n~cat(on Workers ()+ 4 me, IL a

Advances in microelectronic technology have made telephone operators more productive 114 ● Automation of Arnenca’s Offices —

Many firms are using integrated databases, group is designated, turf difficulties with the and employees at various levels need access data processing department have often arisen to it in order to do their jobs. However, access with the continuing convergence of word proc- to different parts of the database can be strati- essing, data processing and communication. fied so that existing organizational lines of au- In one Fortune 500 company, conflict between thority are not threatened. the data processing department and ad hoc office automation group was finally resolved End-User Computing Power when the office automation group was assigned responsibility for managing all resources for Since one source of power is control over re- data and word processing within the firm. The sources and since the computer itself (or what data processing department was limited to pro- it can do) is a resource, there has been some viding data processing services for external dispersal or shifting of power in many organi- clients .37 zations. Only a few years ago computers were a scarce resource; data processing profes- In many cases, organizations have acquired sionals usually acted as gatekeepers between office automation, especially personal com- all other departments and the computer, and puters, without a grand plan, in response to thus were in a position of power. Over the past grass roots decisions at the individual or de- 5 to 10 years, with the declining cost of elec- partmental level. Later attempts to standard- tronic hardware, computer power has become ize or to centralize control of the organization’s much more widely dispersed throughout many information resources inevitably result in bat- organizations. tles when different kinds of equipment or different philosophies of operation have already High costs of computer equipment used to become entrenched. No system is perfect for make centralization more attractive. Lower everyone’s needs, and many groups may want prices, increased capabilities, and the ability to influence the development of office auto- to link workstations in networks now make mation systems to make them most suitable it possible for firms to disperse data process- to their own needs or most acceptable from ing and word processing capabilities. This does their own bias. not necessarily mean that the word processing pools have disappeared (although they Communication have in many firms) but that word processing capability is now available to private secre- Additional organizational implications of of- taries, receptionists, professionals, and others. fice automation are related to their effects on Nor are centralized data processing depart- communication within organizations. An in- ments likely to disappear, as many organiza- teresting sidelight on the case involving the tions continue to need the power of mainframe military logistics office is the way in which computers and the expertise of computer the new system changed communication pat- professionals. However, the ability to do a terns. The senior officers were “left out of the growing variety of data processing activities loop, ” when supply officers began contacting can now be brought directly to every profes- junior officers directly for equipment trans- sional and manager. fers. In addition, however, the flow of information reversed along the junior officers net- In some organizations there maybe an over- work of telephone contacts. The junior officers all strategy to keep centralized control over had created these networks to call out for in- computer resources, to maintain compatibil- formation. However, once the on-line system ity between systems, to make sure that per- came into place, the junior officers became a sonal computer users can access databases, source of systemwide information. Their form- etc. This function may be performed by the — data processing department or by some other “Ginger Levin, “Excellence in Information Resource Man- office automation group. Where some other agement, ” GHL Inc., Washington, DC, 1984. Ch. 4—The Changing Nature of Office er informants made use of the same telephone archy and authority structure. In one exam- network, with its established informal work- ple, members of a disbanded project team used ing relationships, past favors, friendships, etc., their firm’s electronic mail system to continue to call in for information or for emergency work on an abandoned project, eventually con- equipment transfers. vincing management to revive it. At the same firm, the electronic mail system became a Changes in communication patterns maybe means of exchanging complaints and criti- at the base of many of the organizational cisms about management.40 More recently changes associated with office automation, there have been other reports of electronic mes- simply because communication is such a ma- saging systems being used for “flaming, or jor part of white-collar workers’ jobs. Man- emotional outbursts related to organizational agers, especially, spend a large portion of their or other problems .41 Such “subversive” use of time communicating. It is estimated that from electronic mail probably depends a good deal 46 to 77 percent of their day is spent in oral both on corporate culture and on the configu- communication, including both telephone con- 38 ration and capabilities of the system. Anec- versations and face-to-face meetings. dotes from other firms suggest that their elec- The introduction of new pathways of com- tronic mail is never used for complaints or any munication may bypass traditional gatekeepers communication with implications for internal and make profound changes in ‘‘who talks to politics because electronic messages are more whom. ” Although some researchers have pre- easily traced than paper ones. dicted that full access by many workers to a It is not yet clear how effectively electronic linked electronic system could lead to a com- messaging will replace face-to-face or telephone plete reshuffling of power relationships, giv- communication. Early evaluations have not ing most power to those with access to the 39 shown consistent patterns of replacement of system, there is little evidence that formal telephone, face-to-face, or written messages hierarchies are greatly affected by innovations with electronic messages across organizations. like electronic mail and messaging. In fact, At some organizations, as at OTA case study these systems are often constructed in such site Company XYZ, electronic mail has been a way as to reinforce the existing hierarchy, consciously rejected because personal commu- e.g., automatically sending information copies nication is considered important to the cor- to managers of all their subordinate’s mes- porate culture. In another OTA case study, sages, but not the other way around. There Office of the Special Trade Representative, in- are some anecdotes of superiors using the sys- ternal electronic mail is used extensively for tem to intensify pressure on subordinates (“I circulation of documents for comment and it requested that information an hour ago! Don’t would be used externally if other agencies were you check your messages?”). In addition, even equipped. in a completely wide open system, where everyone theoretically has access to everyone else, Many managers do not use electronic mail it is doubtful that everyone has something use- extensively to replace face-to-face meetings or ful to say to everyone else. telephone calls. This may be attributable to two factors. First, use of the technology may However, there are cases where use of an interfere with the personal management style. electronic mail system has lead to the under- Second, there may be dissonance between the mining of an organization’s traditional hier- electronic system and the type of information being transferred. In one study, over one-third ‘~largarethe 11. Olson, “ New Information Technology and Organizational Culture,” .$11S Quarter-l> Special Issue 198,2, of the messages exchanged in face-to-face or pp. 71-92. “See for example, Carol T. Gaffney, “The Impact of office ‘‘Tlarkus, ‘p. 60, citing Ralph filmmett, “T’NET or Gripe- Automation on Power in organizations, ” Proceedings of AFI PS net? Datamation, .Not’ember 1981, pp. 48-58. Office Automation Conference, Philadelphia, February 1983, 1 “Con\ ’ersations by Computer, ” ~~lectronic .Ser}ices Un- pp. 216-21 ’7. limited, october 1984. 116 ● Automation of America’s Offices

telephone meetings contained ‘soft informa- Dispersion of Work Activity tion, that is, they conveyed opinion or conjec- ture. It is possible that messages of this sort Perhaps the most powerful effect of the com- cannot be effectively communicated through munication features of office systems is the electronic mail.42 Another researcher has noted ability to change the location and geographic that teleconferencing also is more successfully distribution of work activity. Once words, used for giving or receiving factual informa- data, or pictures have been converted to election, and less so for complex tasks like bar- tronic form they can be sent to a device across gaining and persuasion.43 These factors make the room, across town, or halfway around the it likely that these technologies are more likely world with almost equal ease. As a result, peo- to reinforce existing trends in the organiza- ple do not have to be aggregated in one place tion rather than to bring about radical changes. in order to work in the same ‘‘office. Major changes in the way people communi- Traditionally, information-intensive services cate at work may come, not from electronic have located in large cities where they have mail, but from common access to databases the advantage of proximity to other organiza- and to computer operations that control the tions and people. To the extent that telecom- work process. If office automation offers em- munication can substitute for proximity, orga- ployees new access to information, it can also nizations will have many more choices in where change their informal patterns of communi- to locate. Many see this as leading to a more cation. For example, where coordination be- geographically dispersed style of functioning tween work groups is taken care of in infor- because: mal ‘hallway conferences’ among work group . . . the increasing spread (and cheapness) of members, there is opportunity for social in- telecommunication reduces the former exter- teraction as well as the exchange of work-re- nal economies of physical proximity, we see lated information. The introduction of an of- the dispersal of corporate headquarters and fice automation system with a shared database major white-collar operators like the insurance may allow these groups to accomplish coordi- industry from the decaying central cities to nation through the system, and the people may the suburbs.44 no longer need to see one another for that Firms might minimize use of expensive big purpose. city office space not only by locating in the At Aircraft Instruments Plant, an OTA case suburbs, but by moving to or establishing study site, coordination through the system, branches in small cities or towns, or even in and the elimination of informal conferences foreign countries so long as a suitable work and negotiations, were clearly goals of the new force and an adequate telecommunications sys- MRP II system. Although these goals have tem are available. The departments most likely not yet been achieved, the new system has to be located in remote locations are those that clearly changed patterns of communication need little outside contact or that primarily 45 within the plant and its offices. Informal con- engage in routine communications. So long ferences continue, but now a major purpose as coordination and integration of work can of negotiation is to get permission to override take place electronically, there is no longer the system. (See appendix B for further infor- much need for spatial proximity. mation. ) In a study of automation in the insurance This integrative quality of computer sys- industry, it was pointed out that the centraliz- tems, which when successful allows coordina- ing and dispersing tendencies of automation 46 tion without physical proximity, leads directly are complementary. Procedures for insurance to the subject of the next section. “Ibid. ‘ Ibid. “ Barbara 13aran, ‘*Technological Innovation and Regula- — tion: ‘1’he Transformation of the Labor Process in the Insur- ‘-Olson, op. cit. ance Industry, prepared for Technology- and Economic Tran- “Thomas hlancie~rille, “The Spatial I+~ffects of Information sition Project, Office of Technology .Assessment, OTA contract Technology, Some I~terature, Futures, February 1983, p, 67. No. 3433 -3610.0 Washington, DC, ,Januar~r 1985, p, 95. Ch 4— The Changing Nature of Office Work . 117 rating, underwriting, and claims handling are remain will increasingly be located outside of increasingly being standardized and auto- cities as organizations search for lower cost, mated. A recent trend has been to centralize nonunionized or more highly educated labor. physically the databases on which these activ- In one insurance company relocation, labor ities depend. Many insurance companies are force characteristics were explicitly important now consolidating their regional offices into in the location decision—the company sought two or three highly automated regional cen- to place its offices in communities where ters. At the same time, these firms are dis- women were “well educated, of German de- banding some of their large centralized data- scent, with unemployed husbands ‘—as these entry pools. Data-entry work is being dispersed were considered the most likely to put in a to functional departments located in agencies good days’ work.4’ or field offices, connected by on-line terminals There is probably a limit to how far spatial to computers at the regional centers. Func- dispersion can go. Most organizations are un- tional units within the company can be in- likely to scatter branch offices across the coun- tegrated electronically through the computer try simply because office automation makes even if they are geographically distant. At the it possible. Certain activities may not lend same time, “because in all cases information themselves easily to dispersion. Because of the is being increasingly consolidated in central unsuitability of telecommunications for activ- master files, although access to it is prolifer- ities like negotiating, persuading, or exchang- ating and decentralizing spatially, decentral- ing soft information, qg it is likely that some ized production is fully compatible with cen- 47 critical mass of employees would have to re- tralized direction and control. main near each other for face-to-face meetings. Spatial dispersion of office work could have In addition, other cultural, logistical, and cost major effects on the labor force of the future factors unrelated to the features of office auto- and could have differential impacts based on mation may limit the number of separate in- race and class. Large data processing pools stallations. often employ high proportions of minority women in low-skilled clerical jobs. These are the jobs that are increasingly being automated —. “Baran and ‘Ikegarden, op. cit., pp. :]0-31. away. The more highly skilled clerical jobs that ‘“olson notes that this ma~’ he one reason wII}’ man}’ — managers hay’e not started using electronic mail to replace face- 1 hici. to-face meetings. See Olson, op. cit.

IMPLEMENTATION

While advertisements are full of the prom- Paul Strassman, formerly Vice President of ised benefits of office automation, there are Xerox, noted that many organizations greatly a vast number of horror stories about unsuc- underestimate the organizational costs (as op- cessful attempts. The technological and or- posed to technological costs) of automation. ganizational barriers to be overcome, the in- Organizational costs, for example, inefficiency ternal political battles that often must be while learning new procedures, time lost for fought, the planning and redesign of work to training, time spent negotiating with peers be done, are daunting. After hearing and see- about new work processes, can add up to sev- ing some of the things that can go wrong, those eral thousand dollars per employee in the first responsible for bringing office automation to year if properly noted and accounted for. 50 their own organizations may consider an im- Where organizational issues like job redesign plementation to be successful if it is not com- and workflow restructuring have not been pletely botched—if productivity does not plum- met or employee turnover does not rise to the ceiling. 118 Automation of America’s Offices properly managed, organizational costs can the role of automation in improving that out- more than offset productivity gains expected put, there is a greater likelihood of selecting from new technology. A number of firms are and designing a system which achieves that demonstrably worse off with automation than objective. they were without it, at least in the short run. Although cost reduction can be an impor- However, these new tools are becoming in- tant objective, a narrow focus on cost reduc- creasingly available and increasingly neces- tion alone may not have the desired results sary for doing business in the present era. It if the organization’s goals and the work proc- is possible to learn something from success- ess leading to the achievement of those goals ful implementations to avoid the problems ex- have not been thoroughly analyzed. perienced in horror stories. In the case of Company XYZ, an OTA case The success of the introduction of office sys- study site, use of information technology was tems into an existing organization has been seen as a competitive weapon, a means of both found to depend on a number of circumstances cutting costs and increasing market share. that surround the implementation. Although However, cost cutting was placed in context various researchers disagree on the relative of the type of work done at XYZ and the cor- strength of their influence, there seems to be porate philosophy. some general agreement on their importance and direction.51 These variables include the rea- The goal was to replace old, rigid, batch- son for adoption, the involvement of key ac- oriented information systems and manual tors, the use of adaptive planning procedures, technology with flexible cutting-edge elec- level of user participation in planning and deci- tronic tools, and concurrently to give users sionmaking, and training and incentives for a renewed sense of power, insight and enthusiasm about their tasks, so as to improve users, and training. 54 organizational performance. Reason for Adoption This focus on user needs led to the criterion that any system selected should be manipula- In most discussions of successful installa- ble by users and should: tions of office systems, there was a clearly iden- . . . augment the worker rather than automate tified organizational objective. Organizational the work. Being able to ask good questions, goals involving improved outputs have been do insightful analyses, take the initiative, and associated with success more often than or- make a decision are emphasized as distinctly ganizational goals defined only by cost reduc- human skills that computers can assist but tion. Cases where a technological opportunity not replace. was seized, without demonstrated organiza- While other firms will have different goals tional need were those where there was least 52 and a different philosophy about the role of evidence of success. their workers, analysis of organizational goals These findings are in line with admonitions and the role of computers in achieving them to tie system planning closely to the office’s is still important. business function.53 Where there is a clear understanding of the output to be produced and Key Actors —- “Tora Bikson, Barbara Gutek, and Don A. Mankin. “Im- Another important element in successful implementation of Information Technology in Office Settings: Re- plementation is the “key actor. ” This can view of Relevant Literature, ” Rand Corp., Santa Monica, CA, sometimes be a top management official who November 1981. ‘)’ Ibid. “Michael Hammer and Michael Zisman, “Design and Im- “Tora Bikson, Don Manken, and Cathleen Statz, “Individ- plementation of Office Information Systems, ” I.aboratory for ual and Organizational Impacts of Computer-Mediated Work: Computer Science, Massachusetts Institute of Technology, A Case Study,’” prepared for Office of Technology Assessment, OAM-005, May 1979. 1985, p. 21. —

Ch 4—The Changing Nature of Office Work 119 clearly supports innovation, but in many cases information, can seldom be successful. In some a “technological entrepreneur” somewhere be- cases, with sufficient flexibility on the part low the top level of the firm maybe the prime of the planners and the users, even a ‘‘drop motivating force in a successful introduction it in their laps’ approach to implementation— of new technology. In some studies it has been one where users have minimal involvement in found that the role of the unit manager is es- planning—can work. A generic system can be sential in successful implementation. 55 modified to fit an organization needs during the early days of operational use. However, Support and understanding of top manage- users may not be sufficiently flexible, and ment are also crucial. In the case of XYZ, the adaptability may not be the only requisite for CEO was the inspiration behind the move to success.” In general, research in t he literature automation, although actual responsibility was as well as “how to’ articles in the computer delegated. Having management support guar- and management trade press agree that in- anteed needed resources and also provided volving users in the planning process is highly guidance in developing a system that matched desirable. corporate philosophy. On the other hand, lack of top management Users in’ the Implementation Process support seems to have aggravated some of the problems in the Aircraft Instruments Plant There are at least three areas where users case study. For example, insufficient funds and must be taken into account—design and im- time for training, both of which undercut the plementation, training, and incentives for success of the implementation, were probably users. Before the user can be adequately in- related to lack of senior management under- volved in the process, however, it is necessary standing of the need. Senior management did to ask “who is the user?” not ease production quotas when the new sys- Although the term “user-driven” is often tem was first introduced, even though it would used in designing office automation equip- be reasonable to expect some decline in produc- ment, there are several conceptions of who the tivity as people learned to use the system. Fur- user is, and it is not always clear which ‘user’ ther, ongoing performance measures were not is being addressed or represented. Wynn points modified to fit the scheduling process inher- out at least three levels of ‘user. ’57 One is the ent in the system. Thus, toward the end of organization or department that intends to de- each month managers all scrambled to bypass velop an automated system. Another is the the system and manually schedule projects person or group of people within the organiza- with high dollar value but low priority, in or- tion with the authority to make decisions about der to meet dollar quotas. This is likely to con- the purchase of equipment. This is often the tinue as long as management priorities and “user” that the vendor is trying hardest to system priorities are in conflict. please. The third is the “end user, ” that is, the person who actually operates a computer Adaptive Planning or terminal. The needs, opinions, and level of knowledge about office practices of these dif- A planning process that is flexible and con- ferent types of user are not necessarily identi- tinuous, both before and during introduction, cal; they may not even be in harmony in some also seems to be associated with successful cases. implementation. It is inevitable that both the organization and the system will change somewhat in the process of implementation. A plan “)Ron H. Epstein, “An Approach to Inb-educing and Evalu- ating Automated Office Systems, Electronic Office: Manage- ‘‘set in concrete, which cannot be modified ment and Technology (Pennsauken, NJ: Auerbach Publishers. to accommodate changed user needs or new 1980). ‘Eleanor 11. J$’ynn, “The User as a Representation Issue, ” Proceedings of the Hawaii International Conference on SJTs- Ibid,; and ~ikson, ~utek, and h!ankin, op. cit. tem Sciences, 1983. 120 ● Automation of America Offices

User Involvement in Design Several studies have shown that what man- and Implementation agers or system designers sometimes perceive Successful implementations of office auto- as clerical workers’ irrational fears of technol- mation technology tend to include users of all ogy are actually very rational concerns. Wynn types in the process. While there maybe some found in open-ended interviews at several firms difficulties in involving future end users in sys- that clerical workers were concerned, for ex- tem selection when they are not yet familiar ample, that they might not be able to learn with computers, there are benefits to be de- the system, that the equipment chosen was rived from the investment of time and effort wrong for the job, that new measures of job necessary to bring them up to speed. No one performance were wrong for the job, that they knows better than the actual end user exactly might lose their jobs and be unemployed. She what he or she does and how it might be done concluded that “people can be seen to resist 59 better. User needs may not be well understood not change itself, but change for the worse. ’ by system designers or vendors, or even by Managers often do not perceive these spe- managers in the same firm. Attempts to di- cific concerns, but view them as generalized vine needs without asking can too often lead irrational fear. In one survey of Fortune 500 to the use of social stereotypes (clerical work- firms, over half (57 percent) of the managers ers do not make decisions, managers will not attributed employees’ apprehension about new type) instead of fact. Getting the user perspec- systems to general, unfocused fear, while only tive early in the planning process can save 8 percent attributed it to fear of computers costly retrofitting or other problems later. and 4 percent to skepticism about manage- Methods for involving the users in the design ment’s ability to manage the change. On the process can include interaction with the en- other hand, only 20 percent of clerical work- tire user community by collecting design data ers attributed other workers’ apprehension to through surveys and polls, or by having user general fears. Most (30 percent) identified con- representatives on the design task force or cern about computers—presumably fear of be- committee. ing unable to learn to use the new system. Finally, involving users in the design proc- About 25 percent cited skepticism about man- ess can help to overcome some of the resist- agement choices, and 22 percent cited job secu- 60 ance to use of new systems often classified rity as the major worry. as “fear of computers, ” “technophobia,” or simply “fear of change. While some have as- Training sumed that certain types of people “naturally’ Training employees to use automated equip- resist new technology (e.g., older workers, less ment is essential to making most effective use educated workers, etc. ) Wynn notes that: of it, and most researchers agree that the importance of training to a successful implemen- The hidden assumption in these notions is that the reason people may not rush to be new tation cannot be overemphasized. As Strass- users of technology is a) psychological rather man notes, “Training, training, training: these than rational in nature; b) the fault of the user are the top three priorities to changing work not of the equipment. Both of these assump- in the automated office. 61 A training plan is tions, if acted upon, cause development orga- a necessary part of the implementation plan nizations to do nothing at all to solve the prob- when an organization begins using office auto- lem, to go ahead and design as they see fit mation system. In addition, continuing efforts and see if people can be forced to use the resulting system, or to go to great lengths to ———.— cater to the users’ supposed psychological and ‘Ibid. cognitive incapacity, mostly by trying to “ad- ‘)(’ Research and Forecasts, Inc., !lhe Kelly Report on People vertise away” the problem.58 in the Electronic Office 11: E?ow Office Workers View Automat- ion (Troy, MI: Kelly Services, Inc., 1983), p. 10. ‘“Eleanor H. Wynn, “Linking User Responses to the De- ‘ ‘Paul A. Strassman, Information Pa~’ofi} The Transforma- sign Chain, AFIPS Office Automation Conference, San Fran- tion of U’ork in the Electronic Age (New York: The Free Press, cisco, Apr, 5-7, 1982. 1985), p. 81. Ch. 4— The Changing Nature of Office Work 121 are necessary–for training new employees and that people perceive the changes associated for upgrading the skills of current ones. with a new system as changes for the worse, “disimplementation’ or damaging resistance An adequate training program may often can result. Many successful implementations constitute one of the major costs involved in have featured incentives to encourage users introducing automated office equipment. Un- to accept the new system, acquire new skills, fortunately, many firms grossly underestimate or accept changes in the social or organiza- the need. In a number of surveys, workers and tional context. While benefits for the firm, such managers in automated offices have cited lack as increased productivity, may be important of adequate training as one of the major prob- to some workers, more personally relevant re- lems related to the implementation of office wards are also important, for example higher automation equipment.62 Training is discussed wages, opportunity for other training or ad- in more detail in chapter 3. vancement. However intangibles such as protecting the worker’s self-esteem are also ex- Incentives for Users tremely important. In this regard, involving The introduction of new technology can workers in the change process can in itself be cause, or at least be associated with, changes an incentive. in the way people do their jobs; in the way [The employee] should see himself as the they interact with other people; and in the master of the machine, not its servant; not amount of power, authority, and self-deter- as a victim of the office design, but as a par- mination, they have at work. To the extent ticipant in it . . . When invited as collabora- ————— tors, many office workers will respond with ‘ -See ~~r ‘~xample, Iioney.well Technalysis, Office Automa- 63 tion and the 11’orkplace, Ilone~rwell, Inc., No\renlher 1984; and enthusiasm to office system automation. Kelly Ser\’ices, Inc., The KelIJ Iieport cm People in the I;lectronic Office, results of sur~e~w performed h~ Research and Forecasts, Inc.. three \olumes, 1984. ‘ Hammer and Zisman, op. cit., pp. 34-3,5. Chapter 5 Office Automation and the Quality of Worklife Contents

Page Section I: Stess and the Quality of Worklife ...... ~ 126 Sources of Stress...... 127 Strategies for Alleviating Adverse Stress Responses...... 136 Section II: Office Automation and Health, Illness and Disease...... 137 Visual System Outcomes ...... 139 Musculoskeletal System Outcomes...... 141 Reproductive System Outcomes ...... 144 Stress-Related Outcomes ...... 148 Section III: Interventions ...... 151 Office Design and Workstation Design ...... 151 Public Policy and Quality of Worklife ...... 155 Research Needs ...... 162 Labor-Management Relations and Office Automation ...... 163 Tables Table No. Page 5-l. Working Conditions Likely to Produce Stress Responses in Offices ...... 127 5-2. Exposures in the Office Other Than the Video Display Terminal ...... 138 5-3. Epidemiological Criteria for Assessing Causality ...... 139 5-4. individual and Work Environment Factors Associated With Visual System Outcomes ...... 140 5-5. Visual System Outcomes: Known Acute or Potentially Chronic...... 140 5-6. individual and Work Environment Factors Associated With Musculoskeletal Outcomes ...... 141 5-7. Musculoskeletal System Outcomes: Acute or Potentially Chronic ...... 142 5-8. Reported Cases of Reproductive System Outcomes in Computer-Mediated Workplaces by Work Site and Job ...... 145 5-9. U.S. Occupational Exposure Standards ...... 147 5-10. international Radiation Protection Association Occupational Exposure Limits to Radiofrequency Electromagnetic Fields ...... 147 5-n. Workers’ Compensation Claims for Employees Working at Video Display Terminals...... 156 5-12. Examples of Mental Stress-Mental Disability Claims for White-Collar Workers ...... 157 5-13. Union Membership by Industry and Occupation ...... 166 Figures Figure No. Page 5-1. Characteristics of the Office Setting That Can Contribute to an Individual’s Quality of Worklife ...... 126 5-2. The Proportion of VDTs Installed in New Office Space Compared to Existing Space, 1984-90 ...... 151 5-3. A Comparison of Workers’ Compensation Claims for Mental Stress and Other Occupational Diseases ...... 157 5-4. Employed Wage and Salary Workers Covered by a Union or Employee Association Contract in 1983-84 ...... 166 Chapter 5 Office Automation and the Quality of Worklife

This chapter is concerned with the individ- An emerging policy debate concerns the risk ual in the office and the way in which office of illness and disease in office environments. automation affects the individual’s quality of The evidence for the potential risks associated worklife. A traditional definition of the qual- with new office technologies is inconclusive. ity of worklife is “the degree to which mem- However, heightened public concern and recent bers of a work organization are able to satisfy workers compensation awards for VDT-related important personal needs through their experi- illnesses indicate that a comprehensive and sys- ences in the organization.’” The relationship tematic examination of all office environment of the worker to the office environment affects exposures3 should be carried out to determine health, well-being, and productivity. Office whether new office technologies are indeed in- automation changes the physical and psycho- creasing a worker’s risk for illness or disease. social dimensions of the workplace and the A systems approach to examining the ap- work process. plications of office technologies indicates that Of the many characteristics of the office, no there are many ways in which office automa- one factor is the sole determinant of quality tion is related to the quality of a person’s work- of worklife, especially not technology; but tech- life. Figure 5-1 shows the general framework nology can change the social processes in- used in the analysis. The core relationships volved in producing an output or the way a are between the organization, the technology, person does a set of tasks. ‘This chapter con- and the individual. The VDT is part of the siders stress, office and workstation design, human-computer interface. The individual’s the human-computer interface and the way personality or characteristics can mitigate the these relate to an individual’s health, well- effects of office automation. For example, some being, and productivity. workers enjoy and are more productive in a highly controlled office environment, while oth- The discussion is two-pronged; one empha- ers seek to maximize their own control over sis is on how new office technologies affect the environment. the quality of work life; the second is on public policy. It focuses on factors that contrib- The arrows in the figure do not represent ute to organizational effectiveness by improv- causal relationships, but rather indicate pat- ing work quality and quantity, reducing turnover terns of association. Ultimately, these patterns and absenteeism, and ultimately indirect la- may be found to be causal, but at present the bor costs. ’ scientific evidence is not sufficient to determine causality. In some cases, the effect of

Figure 5.1 .—Characteristics of the Office Setting That The subjects discussed in this chapter are: Can Contribute to an Individual’s Quality of Worklife Fundamental elements

Organization I Work process Physical envionment station design and labor-management re- Technology I lations. Huma-computer Building design interaction A discussion of labor-management relations Office design Individual ends this chapter because many of the prob- Workstation design lems cited in chapters 4 and 5 can potentially be solved or alleviated through some form of worker involvement in the decisionmaking process, such as collective bargaining.

SECTION I: STRESS AND THE QUALITY OF WORKLIFE

Stress is a term often used in both conver- Office automation, by changing the conditions sation and scientific debate to describe trouble- of work, can elicit psychological and biologi- some experiences in daily life, ranging from cal responses; i.e., produce stress. the illness of one’s child to an acrimonious ses- Psychological stress responses to working sion with the boss. Some stress is routine, the conditions include challenge, boredom, anxi- daily hassles of work. But, typically, events ety, mental fatigue, depression, satisfaction that precipitate stress responses alter or in- or dissatisfaction, and feelings of security or tensify daily routines and roles of worklife.’ insecurity. Biological responses can include Characteristics of office automation that lead 7 chronic or periodic arousal, muscle fatigue, to changes in the work role can thereby pro- headaches, and psychosomatic symptoms. duce stress responses in the worker.’ This list is not exclusive. Any of these can oc- Work-related stress is the psychological or cur among office workers. Office automation biological response to conditions in the work offers the organization a unique opportunity environment. Stressors are the conditions that to create working conditions that challenge cause stress.6 Stress can be either good or bad, the individual worker and at the same time but “good” stress is usually called “challenge.” decrease the frequency of adverse stress re- ——. .—— sponses. a ‘1.eonard 1. Pearlin, “Role Strains and Personal Stress, ” Psychosocitd Stress: Trends in Theory and Research (New York: —-——-—- Academic Press, 1984). Chroni~ arousal refers to neural, hormonal, and immuno- A worker’s role is defined organizationally by the job logical responses to external stimuli. In many instances the heshe occupies. term neurohormonal arousal is used to refer to these distinct ‘This model of stressor and stress response is a common stress responses to indicate the controlling role played by the model used and was originally developed by Hans Seyle and brain in initiating them. Walter Cannon in the 1920s and 1930s. For a good overview “Traditional stress models emphasize that stress responses of this model of stress see, Hans Seyle, The Stress of Life (New follow a U-shaped curve. Too little environmental stimulation York: McGraw-Hill Publishing Co., 1956). leads to underload and stress responses such as boredom. Too A stress response sometimes comes from an- Table 5-1 .—Working Conditions Likely to Produce ticipation of an event as much as from the Stress Responses in Offices event itself. The anticipation of a computer Working conditions in all offices: going “down,’ for example, can produce stress Increased workload coupled w!th. a) IImlted job responses. New technologies often lead to new control, expanded job control and conflicting expectations. Repetltlve task(s} In the job Machine pacing of work The term “technostress” has been used to Lack of tIme for training to acqulre new skills Competing roles at work describe consequences of office automation: Lack of career o p po rt LI n I t Ies I n t hc organ I i7at 10 rl Working conditions in automated offices: Technostress is a modern disease of adap- Electronic mon Itoring as a form of su pervlslc)n and tation caused by an inability’ tO cope with new’ employee monltorl ng computer technologies in a healthy’ manner-. Electronic monitoring as a form of task feedback It manifests itself in two distinct but related Higher expectations for speed of work coupled ~lth ways: in the struggle to accept computer tech- computer system response delays Off Ice work dependence on computer system an(~ nology, and in the more specialized form of system delays ) overidentification with the computer.’ The computer med I at Ion of work and/or the pro blerms with the human computer d~alog The stress response is not technologically Social Isolatlon with the primary I nteractlon the determined, although the word “technostress” computer conveys that impression. Many conditions that Increased soc I al contact and soc [al part IC i pat 10 n VI;) computer networks produce a stress response in the automated ‘ {~~)Ff,~ Off e $ 11 Ill I fq} ii.. I L ~ IT . t office are not the result of the new technology, and solutions to the problems can not These conditions have always been felt in of- often be achievecl through modifications in the fices; new technologies can intensify them. technology. The consequences are contingent They can also ameliorate them. Typically, the on how an organization implements new of- adverse conditions occur together and espe- fice technologies. Most office workers look for- cially affect lower level jobs. Most have been ward to working on computer systems that associated with low job satisfaction or with automate manual tasks they would rather not do. 10 illness, Each can be alleviated with work redesign strategies, contributing to better em- Table 5-1 shows a list of conditions that pro- ployee health and attitudes toward work. duce stress. These stressors are not unique to Table 5-1 also shows a list of office condi- office work: they are also found, for example, tions characteristic of office automation that in factory work. In fact, some people talk about produce stress that may permeate all levels the office becoming the factory of the future. of the organization.

Sources of Stress Factors that bring about stress include increased workload, decreased control over work, repetitive work, machine pacing, inadequate training, ambiguity in role, consciousness of limited career opportunities, computer monitoring of work, unattainable expectations for speed, the abstraction inherent in computer- mediated work, and increased social isolation.

Workload and Control Office automation can increase the number of tasks a person has to complete; increase the 128 ● Automation of America Offices

complexity of the tasks; speed up the pace; lems, attempts are typically made to exert or increase the amount of information needed greater organizational control over what the to complete a task.’] Even the change to an worker does. This can be achieved more easily on-line system from a batch processing sys- through office automation. Greater organiza- tem can increase workload.12 tional control tends to increase the problems of repetitive or machine paced jobs; offering These increases may or may not be transient. workers even less control and resulting in a The ability to modify work strategies is a co-- vicious circle. The productivity of the worker ponent of the worker’s control over the job. ]3 is stabilized below optimal performance level. If the worker has the ability to modify his/her work strategies, the adverse stress responses Two patterns appear to be developing. The can be buffered and transient. When the worker key difference is the level of control. When con- has little control, the adverse stress responses trol is decreased, either through embedding tend to persist. Workload and job control in decisions in the system, electronic monitor- conjunction affect attitudes about the job, the ing, social isolation, or change in the job (e.g., organization, and the worker’s health. the development of a single repetitive task), the interaction between increased workload Computer-based communication networks and decreased control leads to adverse stress have been shown to lead to increased work- responses. Alternatively, when the increase in load by making the transmittal of documents workload is associated with better opportuni- easier and thus more frequent. This leads to ties to arrange the work, this can produce posi- the professional having to sift through many tive stress responses, or challenge, for em- memos to find the relevant one; the case of ployees. information overload. This also may be a transient effect that will disappear as the orga- Repetitive Tasks nization learns to utilize the system effectively. Office automation can result in repetitive A primary motive for office automation is tasks, which lead to increased anxiety, bore- increased productivity, but many stress re- dom, and dissatisfaction with work. The sponses lead instead to increased absenteeism introduction of a word processor or microcom- and turnover (especially under good economic puter can, however, also reduce the repetitive- conditions when jobs are plentiful). These re- ness of tasks—for example, the secretary sponses have also been associated with de- makes a few corrections rather than retyping creases in performance and even with some a page. instances of sabotage. 14 To alleviate these prob- — --- Taking breaks from the monotonous repeti- ‘‘W’orklo~d is the level of demands the job places on the tion provides psychological relief, but some- worker. Technological change can lead to decreases in the amount of time spent at a particular task. However, many times a need for breaks is overridden by the studies have documented that workload more often increases pressure of work. ” with office automation: Jon Turner, Computers in Bank Cieri- cal Functions: Implications for Producti\’it~’ and the Qualit~’ of Life, Ph.D. dissertation, Columbia University, 1980; Michael Machine Pacing J. Smith, et al., “’An In\’estimation of Health Complaints and Job Stress in Video Display Operations, ” Human Factors, vol. When control over when to do a task is de- 23, No. 4, 1981, pp. 387-400; Rob Kling, The Zmpacts of Com- termined by the computer system, tasks are puting on the W’ork of Jfanagers, Data Anal~’sts, and Clerks, said to be machine paced.16 When data entry J$’orking Paper, Public Policy Research Organization, Univer- sity of California, Irvine, 1978. or other tasks are machine paced, the office -Jon A. Turner, Computer illediated Wrork: The Interpla.v begins to mimic the factory assembly line. Ma- Between Technolog~r and Structured Jobs–Claims Represent- chine pacing both increases the workload and ati~’es in the Social Securit&v Administration, W’orking Paper, Department of Computer Applications and Information Sys- decreases control. It can lead to anxiety, de- tems, New York University, 1985. —.—.—— ‘Control is the ability of the employee to arrange work in ] F3rod, op. cit., p. 43. terms of speed, task priority, and ways of performing the task. “A task is said to be machine paced when the worker has ‘‘Ilrod, op. cit.; SEW also Gavriel Salvendy and M.J. Smith no control over the initiation of the work c~’cle or the duration (eds. ), hfachine Pacing and Occupational Stress (I,ondon: Tay- of the work cycle. Typically machine pacing is associated with lor & Francis, I,td., 1981). short-cycle repetitive tasks. Ch. 5—Office Automation and the Quality of Worklife 129 pression, boredom, dissatisfaction, frequent Conflicting roles can develop when employ- health complaints and, decreased productivity ees are expected to perform tasks that are not with increases in error rates. 17 It also can al- part of their job description or are not recog- low higher pay because of an increased rate nized or given social, monetary, or organiza- of production. tional rewards. With computer-based messaging systems, managers and professionals have Training to answer the phone, a task that the secretary 19 The employee is sometimes expected to learn may have done in the past. One major source how to use new equipment with very little time of role conflict for women is conflict between allocated for training. Management expecta- home and work roles. tions about productivity gains rise quickly, Either ambiguous or conflicting work roles so the worker is faced with simultaneously lead to uncertainty in responsibility and per- maintaining the prior level of productivity, ac- formance and to anxiety, dissatisfaction, and quiring and mastering the new skills, and dem- insecurity. onstrating productivity increases. He/she can be caught in a circle of expectations and in- Lack of Career Opportunities creased workload demands, and may never Lack of career opportunities can create feel- learn to use the system effectively. Without ings of job insecurity and belief that one will the time to develop skills, the worker has be replaced by the computer. These feelings limited opportunities for moves up the career are exacerbated by the impression of limited ladder. The daily frustration over lack of time job mobility. Traditionally a worker came into to learn may lead to psychosomatic complaints, an organization, learned skills, and moved up as well as anxiety, depression, and dissatis- the job ladder. Today companies more often faction. hire people from outside with the skills needed. As career opportunities become less apparent Competing Roles the employee can become frustrated. Formal recognition of the responsibilities of managers, technicians, professionals, and cler- Electronic Monitoring ical staff serves to differentiate their work Electronic monitoring can take two forms— roles, also recognizing interdependencies among 18 supervision and feedback. This can be illus- members of the office group. Role ambiguity trated by the example of an information sys- results from the rebundling of tasks through tem that stores data on keystrokes and errors. office automation. The professional can do One form of supervision has the computer sys- word processing and the secretary can do sta- tem examine the worker’s performance and tistical analysis. Who does what is a key man- send the supervisor a message about her per- agement decision. Without role differentiation formance compared with prior records and or- it is unclear who is responsible for particular ganizational standards. The worker has no problems. responsibility for when the monitoring occurs or how the information is used.20 Another form, job feedback, lets the employee use the infor- .— Sal\wndj’ and Smith op. cit. .%x also: h]. N. (_k)rlett and ‘H. C. Amick and J. Damron, “Considerations in I~efining J. Richardson (C>dS. ), .$tress. \i-OI_k ~~S&, ~~d Productilritj’ office Automation: .4 Case Stud~’ of the Eastern Africa Re- ( New I’m-k: tJohn if’ile~r & Sons, 1981); and Robert Caplan, et gion of the M’orld Bank, ” Proceedings of the First i) S.4-,Japan al., (lot) Den?and.s and \lrorkers l{ealth. LJSDI 1 EJ$’ ( N 10S11 ] Conference on Human-Computer Interaction, Honolulu, ii:~- 75-160 ( t$’ashin~ton, I )(’: {J. S. ( ;oternnwnt ]]rintin~ office, u’aii, CJavriel SaJ\rendy (cd. ) (Amsterdam: Else\’ier Science Pub- 197>1. lishers, 1984), pp. 439-.! 45, ‘Ij. (i, [>. (’ohen, ‘ ‘organizational F-actors Affecting Stress ‘This example also points out the problem of separating in the Clerical \l’orker, ” human ,lspects in office .4 uton]a- these factors from other stress factors. In this situation. the tion, 13,(;. 1’. Cohen (cd. ) ( /\nlsterdanl: l“~lset’ier Science Pub- worker is not onls’ being monitored but also ma~: be machine lishers, 19H I), pp. 33-42. paced and has no control ok’er the task or the Job. 130 ● Automation of America “s Offices

I I Photo credit Cornmunlcattons Workers of Arner(ca

In the communications industry, workers can be continuously monitored. These charts show the monitoring of employees by the Average Work Time System. Every call is timed and the total volume of calls handled per day by all workers is then used to calculate an average number of calls for a given period of time. An AWT figure of 100 means that the operator’s performance was average mation to find out, for example, how many ing places added pressure on the employee to files were completed in a given period of time, produce at the pace and level established by and modify her performance accordingly. The the machine. This leads to increased anxiety, first often produces adverse stress response fatigue, psychosomatic complaints, and job 21 and the latter positive challenge. dissatisfaction. The employee, knowing he/ she will be expected to perform at a specified With electronic monitoring for supervision, maximum consistency and reliability in performance are sought. One distinction between -’13ecause the terminal provides the worker with all the necessary information to complete any task, there is no need for traditional work monitoring and electronic the employee to Iea\’e the workstation. This constrained pos- monitoring is that the former is intermittent ture for extended periods of time is a key element in \isual and the latter continual. Continual monitor- and musculoskeletal problems. Ch. 5—Office Automation and the Quality of Worklife ● 137 level throughout the day, feels chronic arousal worker’s daily productivity as a percentage and job dissatisfaction. 22 figure based on what the employee reported as having done that day. z’ Electronic monitoring can also offer challenge and job satisfaction, if it is designed and If a professional, manager, or secretary is used as a form of task feedback. Traditionally making entries into a calendar, then the per- feedback on performance and product quality son’s schedule can be examined through ac- is usually notice that an error has been made. cess to the files. In one large American com- Or it is received infrequently (in quarterly or pany, the Chief Executive Officer plans to use even yearly evaluations by the supervisor), and the computer system for just this purpose. ” the worker begins to believe that quality is Employees in the networked system can also not a major concern. Quality checks through get more immediate feedback about a project an on-line work monitoring system can im- to which they have contributed. This provides prove the reliability of performance, and in- them with a broader picture of what the orga- crease the responsibility for the product; this nization is doing, and so leads to increased can lead to greater job satisfaction and greater satisfaction and commitment. commitment of the worker to the organization. 27 Higher Expectations of Speed A subtle effect of office automation is the Typically, electronic monitoring has been generation of higher expectations of speed. carried out among support staff and supervi- This can lead to a distorted sense of time and sory staff, but as microcomputers and mini- distorted expectations about behavior. One computers are linked with larger mainframe characteristic of the computer system is the systems, any person can be monitored. One ability to respond quickly to commands. The example of productivity y monitoring of profes- manager and the clerical worker alike can de- sionals is from a loan administrator using a velop a new time reference. Management Information System (MIS): Days, hours, and minutes take on new mean- Each employee is watched by the system, ,.. To be tracked on the system is to be mon- ing as time is compressed and accelerated. . . . itored by it on a daily basis with regard to Jobs that took days before computerization are expected to be done in hours. . . . Soft- every conceivable item of work which could ware that was once appreciated for its speed, be performed on the job. The MIS does per- such as VisiCalc, is suddenly viewed as form some essential functions in helping to 26 manage the enormous work load, hut often clumsy and S10W. it was looked upon as an excuse for increas- The worker begins to notice response delays ing the work load even more. Preparing the in the microcomputer or larger computer sys- daily MIS input sheets at the end of the day tem. As he/she becomes more proficient, he/she is a dreaded duty, done hurriedly before leav- develops a high expectation of speedy responses ing the office. The MIS theoretically tracks from the computer at known intervals. When everything which the loan administrator per- delays occur, the pattern of work is interrupted forms during the course of the day. The entire job of the loan administrator is dissected as the worker is forced to ‘‘waste time wait- into every minute function which might be ing for the system to respond. This leads to performed. Each function is assigned a cer- anxiety and dissatisfaction. When the delays tain time standard for how long it should take persist above a certain time there is an increase to be performed. The system calculates each in the error rate for keystrokes. — — —— E’or an example {)f how prior knf)wlcd~c of an e~’ent can produce a stress response we the work of hlm-ianne Franken- ‘Alan Mrestin, Pn’Itic>’ issue.~ in the .filonitorin~~ of F.’m- hauser, “(’oping J\’ith Stress at t$rork. Znfernal iOn:Jl ,Jotlrna) plo-~’ee 11’(xk m 1‘lIT”s in the (lffice ~;n~’ironnwnt, contractor of l?wft h Swv’jces, ~ol. 11, No. 4, 1 W 1. pp. 491 -h 10. r(’port prepared for the office of Tm’hnolo~q’ Assessment, 19H5, Richard l+;. R’alton, “ From (’ontrol to Commitment in t h(’ Nlark I)[~tt~, *’G]? JI’elch l)owering Firm Into (;lohal Workplace, Iiar\-~ird llusinets.~ Ret’iew. Jo]. 35, No. 23 1985, (?ornpetitor: Part [, ““ The T!-a.shington l’o,st, .Sept. Y;3, 19tiI, pp. 76-~ i. ‘ Jlrod, op. cit. 132 ● Automation of America offices

This new time reference results in higher ex- 2) the abstraction of work, and 3) the human- pectations of oneself and others. A worker may computer dialog. seek to discover ways of circumventing organ- Judgment is fundamental to work, yet a prin- izational procedures to get work completed cipal goal of automated work can be to reduce more quickly. Going through channels or do- judgment and therefore error. Alternatively, ing excessive paperwork becomes a barrier. automation can be used to create more oppor- This also can lead to increased anxiety and tunities for exercising human judgment. The tension and feelings of work pressure, or to key to the former approach is the substitu- a desire for social isolation because one would tion of computer algorithms or decision rules rather work with the computer than with a for judgment. This necessitates a formaliza- person–only the terminal can respond quickly tion of skills traditionally obtained through enough. This tension requires some form of experience. Problems arise when the worker stress management. is not provided with new opportunities to ex- Like the individual, the office can become ercise judgment. dependent on the computer system and vul- For example, automated systems may as- nerable to system delays. This is perhaps largely sign priorities to tasks or refer accounts to a transient problem associated with the im- employees as they complete previous assign- plementation of a new system, although changes ments, decisions previously made by super- in both software and hardware will continue, visors. This is usually done when automating and the work process will become more and tasks that in any case are very standardized. more dependent on the computer. When the system breaks down the worker looses con- The computer mediation of work extends to trol over the work and it piles up. Messages professionals and management. Attempts have cannot be sent to coworkers in other build- been made to define decisionmaking so that ings, memos cannot be printed or distributed. a level of reliability and predictability in judg- A sense of anticipation develops in the worker– ments can be maintained. The shifting of par- when will the system be back up and running? tial control from the individual to the com- One study in a Swedish insurance company puter system also is a defense against data found that when the computer system went contamination that could result from unlimited down workers responded with increased arousal, access to an on-line system.28 Risk-taking be- higher blood pressure, fatigue, and feelings of havior and creativity, especially of profes- being rushed (work pressure).” sionals and managers, can be constrained when decisions are embedded in the computer sys- Computer Mediation of Work tem. The meaning and challenge of work dis- The computer mediation of work is likely appears and boredom and job dissatisfaction to produce stress responses that vary from ensue. A constant state of chronic arousal boredom and job dissatisfaction to challenge places a biological burden on the worker. The and increased productivity. Three character- airline pilot or the nurse who monitors a con- istics of computer-mediated work that are trol panel instead of the plane or the patient, likely to produce stress responses are: 1) hu- can become bored and dissatisfied, feeling that man judgments being built into the system, their training is useless if the computer is going to make the decision. ’g Although uncertainty may lead to errors, freedom of choice — - Gunn Johansson, “Computer Technology: Stress and leads to creative and inspired decisions, which Health Relevant Transformations of Psychosocial Work Envi- — — ronments, ” Proceedings of the First USA-Japan Conference %hoshanah Zuboff, “New Worlds of Computer-Mediated on Human-Computer Interaction, Honolulu, Hawm”i, Gavriel Work, ” Harvard Business Review, vol. 60, 1982, pp. 142-152, Salvendy (cd.) (Amsterdam: Elsevier Science Publishers, 1984), (hereafter referred to as “New Worlds, ” 1982). pp. 347-354. In this study, VDT operators performed data-entry “Shoshanah Zuboff, “Problems of Symbolic Toil: How Peo- tasks and were compared to non-VDT operators performing ple Fare With Computer-Mediated Work, ” Dissent, winter 1982, similar tasks. PP. 51-61 (hereafter referred to as “Symbolic Toil, ” 1982). Ch. 5—Off/cc Automation and the sometimes go against the grain of organiza- log.)33 A dilemma the organization faces is that tional logic, and it is this logic that is typi- the expert underwriter is expert because of cally programmed into the computer. so knowledge gained through field experience, and the dynamic nature of the insurance mar- Nowhere is the use of computers to approx- ket will demand continual adjustments in the imate human judgments potentially so dra- expert system to reflect current patterns. matic as in the area of expert systems. 31 The Therefore, the industry will be required to goal of developing an expert system is to place maintain and encourage the traditional path- in the computer the knowledge and decision- ways for the development of expertise. The making processes of the best workers at a extent to which the transfer of human judg- particular job. This can enhance a job by pro- ment to a computer system produces a stress viding large amounts of information in a man- response in the worker is contingent on how ageable form, allowing a person to ask ques- the new job is defined and how the worker uses tions that were difficult to ask before. Expert the system—as a tool to assist in decisionmak- systems can evaluate decisions and suggest ing or as the decisionmaker. alternative solutions to problems. The system can serve as a learning tool for new workers, In office automation, a key movement is who by asking questions and giving answers from physical to mental activities; or the ab- can simulate experience that may otherwise straction of work.34 Instead of manipulating have taken years to encounter. physical objects, creating, storing, and distributing forms and documents, in automated Expert systems for use in offices are still offices, one moves symbols with the push of in an early phase, but one area already im- a button. Messages appear on the screen in- pacted is insurance underwriting.” (See box stead of on paper. For the person who is accus- A for an example of the human-computer dia- —.. tomed to being able to see and take part in llistori~~ll?, researchers ha~’e argued about whether tht’ the process of manipulation, this change can bureaucratic structure of the organization constrains human lead to a sense of removal from the work proc- beha~ior by increasing centralized control and explicitlsr defin- 3 ing the rules by which the tasks should be performed and the ess. ’ As the worker becomes accustomed to job elaluated. These trends can reduce the effectiveness of the the new form of work, this sense of abstrac- organization as well as the emploj’ee. The implementation of tion can diminish. office automation can allow man~ of the rules to he embedded in the s~stenl. For discussions of this idea see, ill ax 14’eber, The Theor\ c)f Social and l

Box A.–Expert System Used in Insurance Underwriting: An Example of the Decisionmaking Process A publishing company in California has decided to insure their data processing facility. They hire insurance agent Smith to find the best possible policy for them. Mr. Smith approaches Ms. Jones of Insurance Company West to develop a policy for the data processing facility housed in a 25-year old brick building. Ms. Jones goes to the computer terminal and starts a file called Publishing Company Ac- count. She then accesses the expert system to get assistance in defining the parameters of the policy. First, she must enter information about Mr. Smith, the agent. The computer system has a large database of agents the company works with, describing the type of work they do, their reliability and the quality of the information they provide. (This database is updated quarterly by the company to enter information on new agents and update the information on old agents.) The system evaluates Mr. Smith. Uncertainty coefficients are then estimated by the computer system based on information about Mr. Smith. The expert system uses this coefficient to determine the most appropriate questions (prompts) to Ms. Jones. Any equations used in final recommendations by the system take into account the agent’s uncertainty coefficient. Then Ms. Jones enters the basic information about the facility. The computer responds that in California, 20 years ago, reinforcing bars were not mandatory in brick buildings. Therefore, earthquake damage must be excluded from the policy. The system may then prompt Ms. Jones for information about smoking-is it permitted in the data processing facility, and in what rooms? The system prompts Ms. Jones about whether flammable solvents are stored in the room. A value may be assigned to designate the importance of this information. The system then combines this information with other information. It prompts Ms. Jones when necessary, and comes to a decision about the policy just as an expert underwriter would.

SOURCE: Baeed on an interview with Steve Weyl of Syntelligence, Inc., Santa Monica, CA, 198S.

to perform the same task over and over within anxiety, and job dissatisfaction.36 The worker the rules defined by the computer system. In may use the system less and less, or not at- the extreme case, the worker monitors infor- tempt to fully use the system capabilities; a mation as it comes to the screen, but all judg- circle develops leading to further anxiety and ments are made in the system or by some other less productive use of the new office technol- person at another location. For workers whose ogies. A satisfactory human-computer dialog job involved interaction with people, this can counter the sense of abstraction, giving change can mean a loss of the sense of the the operator a greater sense of control. Thus, meaning of the work. transitory problems with office automation may be alleviated with appropriate attention Computer-mediated work is characterized by to the human-computer dialog. a human-computer dialog. The quality of the dialog is important to the quality of working When the dialog uses concepts and phrases life. The user gets from the software informa- that match the operator’s task vocabulary,37 tion about the current state of the system, the this encourages the use of the system and in- work, how to proceed or return to an earlier creases the likelihood of greater productivity y. part of the process, the future stages of the .—— production process, and the consequences of “’Jon Turner and Robert A. Ka-asek, ‘* Stjftware ~rgc)nOrn- ks: Effects of Computer Application Design Parameters on further command sequences. If the software operator Tasks Performance and Health,’’”llrg~~~~lj~’s, ~’o]. does not provide the needed information, there ZT, No. 6, 19S4, PP. 663-6!30. is decreased control over the work, bringing Turner and Karasek, op. cit. Ch 5—Off/cc Autormtion and the Quality of Worklife ● 135

However, as users become more advanced they There is a tendency for workers to spend begin to prefer more formal dialog. 38 Menu more and more of the day interacting with a driven systems guide the novice user; as the computer terminal. In Japan, researchers have user becomes more knowledgeable, this may recognized this potential: become tedious; the user feels held back by There will be more need for lounges and dis- the system. This can also produce anxiety, cussion rooms and the like, to break the rou- boredom. and job dissatisfaction. More “tran- tine of stress from the machines. As tasks be- sitionality in the way that people and com- come more mechanical and isolating, more puters interact or interface will alleviate this group activities and worker clubs and incen- source of stress. 39 In a dialog based on transi- tive systems need to be developed t o keep up tionality, the user can designate changes in team spirit and morale.” the human-computer dialog as he/she becomes The worker may spend so much time at the more proficient. terminal because he/she is electronically monitored and paced or because there is no need Social Participation or Isolation or opportunity to interact with others, result- The office is a social environment, and as ing in social isolation, which has been shown the technology changes, the social relation- to be associated with depression, anxiety, job ships of work may also change. This is impor- dissatisfaction, muscular fatigue, and psycho- tant because the social group can be a buffer somatic symptoms. 42 between the worker and other characteristics When the computer becomes the primary of the work environment .4” Communication source of interaction in the office, coordina- and social participation in the work process tion of the work process is transferred from is central to the productivity of the work unit the social to the technological milieu. .4 tech- and the maintenance of the organizational nological form of communication develops and culture. both work and communication tend to become This social network can be particularly im- more formalized. Whether this will adversely portant in a dynamic work environment. At impact the quality of worklife is unknown at times of heavy workload, when peak worker the present. One of the primarly reasons for performance is required, the resulting adverse social interaction is to communicate value stress responses affect the employees capa- judgments via both verbal and nonverbal means. bility to perform. A social environment capa- The content of the communication may be im- ble of ameliorating these conditions for the portant although not directly pertinent to the worker is often not considered in evaluating work process. For example, the employee may the affects of office automation on the quality be performing poorly because of circumstances of working life. Yet, new office technologies at home, or an illness; when evaluation is based can either create more opportunities for com- primarily on computer monitoring, supervisors munication and supportive interaction or close may not recognize these circumstances43 off channels. Alternatively, increased social contact can be provided via the computer system or via user groups, because computer-based communication can remove both time and distance 136 Automation of America Offices — constraints on communication.44 This can lead Data have not shown conclusively that these to greater employee involvement and commit- programs are cost effective. Their disadvan- ment to an organization along with increased tage is that working conditions are not modi- job satisfaction. fied to remove the source of the adverse stress response. In fact, research has shown that to Strategies for Alleviating Adverse realize the benefits of stress management typi- Stress Responses cally requires extensive and costly training of the worker, not the typical market offering of The strategies for alleviating adverse stress a two-day seminar. There is no credentialing responses simultaneously encourage challenge, of the trainers and there are vast differences or positive stress responses. Three different in the quality of the training. Therefore, al- approaches concentrate on different parts of though stress management programs are the model that was shown in figure 5-1 and popular, the employer is often faced with hav- have different goals. Stress management pro- ing to make a decision about them without grams focus on the individual, job redesign sufficient information about the quality of the programs focus on the job, and sociotechnical training and the likely results. programs focus on the work process. No single approach is always adequate. A participa- Job Redesign tory style of management in the implementa- Job redesign or task redesign are both ways tion of new office technologies will help to to modify the working conditions to change identify the methods appropriate for a success- stress responses. Office automation presents ful implementation. an opportunist y to develop job or task redesign strategies. The central thesis of job design is Stress Management that through changes in characteristics of a Stress Management refers to stress reduc- job such as feedback, autonomy, task iden- tion programs tailored to the needs of the tity, and skill variety, the internal motivation individual,45 providing training to deal with and thus the performance of a worker is en- conditions either at work or home.4G These pro- hanced. grams can include meditation, progressive Task redesign focuses specifically on task(s) muscle relaxation and biofeedback, and cog- rather than on a job. The scientific manage- nitive/behavioral skills. The advantages of ment philosophy is a method of task redesign, these approaches are that they do not require which in office automation primarily involves any changes in the work process, organization, changes at the human-computer interface and or the physical environment. They assume no the allocation of tasks between the worker and fault for the stress responses on the part of the computer system. either management or the worker, but place on the worker the responsibility of coping with Unlike stress management, job redesign adverse stress responses. changes the conditions of work. When jobs are designed with little meaning and little respon- “In one Swedish study, it was found that 50 percent of the sibility, and the worker has no information system messages would not have taken place without the system. Cited in Alexia Martin, Office Automation: Catalyst for about how well he/she is performing, there can Change–Managing the Transition to the Automated Office, be motivational problems.47 For example, the SRI Research Report No. 694 (Stanford, CA: SRI International, overrationalization of clerical work results in 1984). ‘ I,awrence R. Murphy, “A Comparison of Worksite Relax- repetitive jobs, lacking responsibility and offer- ation Methods, Human Aspects in Office Automation, 13. G.F, ing little scope for personal development.4g Cohen (cd. ) (Amsterdam: Elsevier Science Publishers, 1984), pp. 257-265. ———— “ Recently, new software has entered the market that as- ‘ -Richard J. Hackman and Greg Oldham, ltrork liedesign sists the worker in managing stress. One such program is Relax, (Reading, MA Addison-Wesley Publishing. 1981). which uses biofeedback techniques along with muscle relaxa- ‘“These types of jobs may lead to high labor turno~rer, ab- tion methods for managing stress. See Joseph Hager, “The senteeism, and recruitment problems. This leads to inefficien- Stress Manager, ,, ~>cjr ~ror]d, September 1984, PP. 22~-232 cies through lost time, recruiting and training, and costs asso- (continud) Ch. 5—Office Automation and the Quality of Work/i/e 137

Many job redesign programs seek to expand tion to an end product, workers collaborate these jobs.49 to produce a product. Many offices already have small working groups such as the secre- Job redesign, unlike stress management, retary and the manager. However, office auto- quires that management recognize a problem, mation sometimes changes this, and may dis- and change working conditions. This could in- solve familiar interdependencies. volve relatively high initial costs. Another disadvantage is that job redesign efforts tend to In sociotechnical work systems, members focus on a single class of jobs rather than on can share decisionmaking about who is to do the work process; and on internal motivators what tasks and how they will be executed, with such as self-esteem rather than external moti- each person capable of doing a variet y of tasks. vators such as career ladders and pay. 50) There The pay/reward system can be tied to the skills may be few opportunities for successful job in order to encourage skills acquisition and redesign if an organization has only a limited career development. There are very few exam- set of tasks to be done. ples of such semiautonomous work groups in white-collar organizations; and those few typi- Sociotechnical Systems cally involve lower level staff .5] Sociotechnical systems developed as a counter The advantage of this approach to stress strategy to the traditionally structured orga- reduction is that it requires changes not just nization. Instead of each worker doing a sin- in the job but in the work process. The princi- gle task or set of tasks with no clear connec- ple disadvantage is that changes required at the organizational level and training of work- ciated with o~’errnanning to deal with absenteeism. For an ers in group processes such as decisionmak- example of how to measure the impact of beha~ior on organizations see, Jl”a}’ne 1:. {’ascio, Costing liuman Resources: 7’he ing may be costly. But in addition to reduc- f+’inancial Impact of lleha~ior in organizations (Boston, N1:4: tion of stress there maybe additional benefits Kent I)ublishing C()., 19H2}. such as changes in pay structure to reflect the ‘‘Iror an example of a job redesign program in white-collar work see, Rodgyr \tr, (; ri ffeth, ‘‘ \loderation of the hlffects of new skills demanded by computer-mediated Job F;nrichment b~ I)articipation: .4 I,ongitudina] Field F~x- work, with the incentive to continue learning, pediment, ” organizational Beha\’ior and human l)ecision l’ro(’- increased sense of job security, and recon- PSS, \’ol, 35, 1985, pp. 73-9;1, I n this experiment, desk receptionist jobs were increased in terms of task identity, skill ~’ariet~, figured job ladders. Continuous electronic autonom~’. and j oh feedback, resulting in increased j oh sat is- monitoring may no longer be needed if the faction and self-esteem. group makes its own decisions about the speed In re~iews of job-redesign experiments conducted o~er the past 20 years, it has been found that a key predictor of n~ain- and pace of work, monitoring each other.5z taining the changes in producti~it}’, quality of work, abw’ntee- ism, and turno~’er was an organizational recognition of t he new — — tasks and skills a person was using in his her work. HasicallJ, Recently, there has been a growth in the use of sociotech- the workers wanted changes in the reward s~’stem to reflect nical system programs in all le~’e]s of the organization. F’or the new job. I f these changes did not de~’elop, then man~” of examples, see Cal\’in Pa~ra. Itlanaging .Veu’ Office 7’echnolo~~?’: the problem~ the jot>redesign strateg~’ was intended to resol~re ,4n organizational Strate~ { New” }’ork: Free Press, 198:31. returned. tJohn P;, Kell~’, Scientific ,Ifanagement, ,Job Redesign -There also can be problems with autonomous groups such and It ”ork I’erformancr { Yew }’ork: Academic I)ress, 19821. as exclusii’ity and excessi~.e pressure to conform.

SECTION II: OFFICE AUTOMATION AND HEALTH, ILLNESS AND DISEASE

The video display terminal (VDT) is the de- was depicted in figure 5-1, the VDT is only vice most often discussed in relating illness one part of the work environment. Much of and disease patterns to office automation. It this section will focus on the VDT, since most has become a symbol or a scapegoat. But as of the research has done so; but the VDT must 738 ● Automation of America Offices be considered in the context of workstation Table 5-2. —Exposures in the Office Other Than design, office design, and the task and job.” the Video Display Terminal Occupational health research has tradition- Indoor air pollutants: Micro-organisms ally focused on blue-collar work; office work Cigarette smoke has been considered the least hazardous of oc- Dust and particulate cupations. The growth of the white-collar la- Chemical emissions from machines: Ozone from photocopiers bor force and the ubiquitous applications of Methyl alcohol from mimeographs the new office technologies demand that this Ammonia from blueprint machines assumption be reexamined. By the year 2000, Chemicals in paper/office supplles: Formaldehyde from carbonless copy paper it is estimated that most white-collar workers Noise from office machines, ventilation systems, and will use a terminal. Therefore, office automa- conversation tion requires the attention of public health offi- Static electricity Low humidity cials because of the magnitude of the work force Inappropriate lighting design: at potential risk for any potential illness and Excess lighting disease outcomes.54 Insufficient Iightlng Glare The list of potential exposures in the office Overcrowding and lack of privacy Poor ventilation is large and diverse. Table 5-2 showed the list Awkward and static work postures of exposures for workers in all workplaces, NOTE This IISI does not Include any factors relate J 10 either the lask job or many difficult to measure because they occur organ !zatlon wh!ch may be associated with stress responses These arP (j I scussed I n another sect Ion SOURCE Jeanne M Stellmarl Of f!ce Automation A Publ(c Health Pe~>pectlve on the Potential Acute and Chrontc Effect: paper presenle[l at the Of flee of Technology Assessment Symposium or) f he Impacts uf Off !ce 1 Iealth has been defined b~’ the W’orld Health Organiza- Autornat!on and Computef Mediated Work on the oudht y of V~ork I Iff! tion as the state of complete social, psscho]ogical, and ph?wi- Dec 1012 1984 cal well-being and not the absence of disease. Illness is a subjective state where the indi~ridual is aware of dysfunction. Disease is generall~’ a pathological process that creates and at low levels. ss New office technologies must ends in an altered physiological or ps~’chological state. be considered in conjunction with these ex- “’Risk is the probabilit~ of a disease or an illness free individual developing a speclflc illness or disease over a specified posures to understand their full impact. A ma- period of time. It is conditional on that individual not develop- jor problem is the lack of long-term statistics ing an other illness or disease during that period of time. on the illness and disease of office workers. The most comprehensive and thoroughly analyzed national statistics are 25 years old, from the 1960 Health Examination survey.” An examination of the medical literature indicates that little valid data exists even on absenteeism and sick leave rates beyond specific industry studies. This makes it impossible to compare historical trends of the morbidity and mortality of office workers with present rates.57

Jeanne \l, Stellman, “office Automation: A Public Iiealth l)erspecti~e on the Potential Acute and Chronic Effect s,” paper presented at the office of Technolo~ Assessment S~mposium on the Impacts of office Automation and Computer- Mediated Work on the Quality of W’ork]ife, Dec. 10-12, 1984. ‘ National Center for health Statistics, Selected l{ealth (’characteristics b~’ Occupation: United States–Jul~. 1961 -June 1963, Vital and Health Statistics, Series 10, No. 21 (14’ashing- The VDT IS sometimes placed alongside other ton, DC: U.S. Got’ernment Printing office, 1965). technologies (such as the microfiche reader). Some of ‘The problem with using industry studies to establish na- the symptoms workers report can be traced to the tional trends is exemplified by work conducted in the late 1960s different lighting requirements of different on the relationship between social class and coronar~ heart dis- technologies In the workplace ease. 1 ndustr?’ studies showed a positi~’e relationship between (continued) Ch. 5—Office Automation and the Quality of Worklife 139

The four major categories of outcomes to Table 5-3.—Epidemiological Criteria for be discussed are visual system outcomes, mus- Assessing Causality culoskeletal system outcomes, stress-related 1, Strong association of factor to outcome outcomes and reproductive outcomes.58 Causal 2. A dose-response relations i p between the factor relationships between some characteristic of and the outcome 3. Clear temporal relationship between the factor the office environment and the outcome are and outcome assessed using the standard epidemiological 4. A consistency of findings across studies criteria for determining causality, listed in 5, A biologically plausible explanation for the observed association table 5-3. ’9 The risk of these outcomes can be NOTE These crlterla do not al I have to he satlsfled at one t (me and In one st ud~ reduced by job and task redesign, office de- to suggest a rel at Ion sh I p or Iac k of a rel at I on sh I p between the ne A off Ir- e technology application and a worker s health For example (f rICI sign, and workstation design. The question re- biologically plauslble ex planatlon car be offered for the obser, ed mains open as to whether new office technol- assoc! at I on that may be due to Inadequate kn owl edge or measu rer~l vr~ t techn I q ues Thls makes It very dI f+ c u I t to refute a rel at I onsh I D bet w ee r, ogies lead to an increased risk of illness and a factor and an ou I come based 01 a I ac k of blolog~cal or blom PC har] I r al evidence disease. SOURCE A M Llllenfeld and D E Llllen$eld Founcfaf~ons of Ep/demlo/oqk ( Ne A York Oxford Unlverslty Press, 198(II Visual System Outcomes strain, ranging in various studies between 47 Fifteen years of research has shown that and 91 percent of all operators. Comparison VDT workers report a high prevalence of visual to other workers suggests that VDT work is associated with an increase in visual symp- social class and coronary heart disease, The higher ~he social toms across most occupations, but especially class the higher the incidenw of coronary heart disease (Cl 11)). in those with heavy visual demands. Table 5- I n communit~ and national studies, the relationship found was ne~ati}w the lower the social class the higher the incidence 4 shows many of the factors that have been of C 11 D. one reason for this inconsistenc~ is selection hias, associated with asthenopia (visual fatigue) and J$’hite-collar workers are likel~’ to be kep~ longer bJ’ the orga- perception problems in automated offices. nization, and maJ’ be more likel~ to return after serious illness. Thus blue-collar workers aro no longer in the industry to he Visual symptoms are associated with specific counted, but they, are still found in the comrnunit~., and arc characteristics of the individual, the physical 4 counted in community studies. This phenomenon is the ‘health~’ environment and the work process. But based worker effect that over time leads to underestimates of the pre~ralence of an outcome in industrs’. on the current evidence, causal relationships ‘A nether health outcome whose appearance is associated cannot be established between office automa- with office work is dermatitis, There ha~.e heen too few cases tion and visual pathologies. to reliahl~. identify a singl(’ cause. Some researchers ha~’e h~’- pothesizeci that this is due t~) an elect ros~atic field that huilds Asthenopia and other acute60) visual system up between the terminal and the operator, The unanswered question is wh~ the dermatitis onl~ appears on the face. I t maJ outcomes reported by VDT workers are listed be that when one cleans off the screen and then touches ones in table 5-5. A major problem is the lack of face the dust and fib[lrs collected on the screen are transmitted correlation between reported visual symptoms to the face. I n a recent stud~., it was found that setreral der- matological problems occurred in a greater frequenc~. among and clinically observable signs. Furthermore, 1’ 1)’1’ operators The researchers were unable to determine there are no national data with which the prev- whether this was due to phj’sical factors such as the electrostatic alence rates can be compared. In those studies field, ps~chological factors, or pure chance. Thej concluded that Working at the t’ 1)’1’ ma~r not create but exacw-hate dermato- where visual functions (eye movement, visual logical prot)lems. Carola I.indcn and (Jan P]. W’ahlher-g, JI’or-k acuity, pupil size, blinking, accommodation at \ ‘id(v) I)isp]a.b. Terminals. .~\ n Plpidetr]io]ogic”;i] ] lealth [n- and vergence) have been objectively measured, ~e.sti~ra t ion of of fi[v IS \ ing workplace exposu rt~s SLYI the ( )TA report, l’r[>- time with th~, (~xposure, (’hronic outcomes are persisttint and ~ (’n(inAr lflnt’.s.s ;]nd Injurj’ in the ll”orkpi;]~v, ()’1’.+1-1 1-256 (Jfrash - ~’ndu ring an(i distant 1}” or i nd i r[’ct lJ’ associated vit h the ex- ington. 1)(’: (‘ S. (io~crnm(’nt I%in( ing office, 19851. posure. 140 Automation of America’s Offices —.

Table 5.4.—individual and Work Environment Factors No existing data shows that working at a VDT Associated With Visual System Outcomes can lead to the development of cataracts,61 but Individual: neither has the VDT been thoroughly absolved. Age While in some industries people have worked Uncorrected refractive errors at VDTS for years, no study has examined the Work environment: prevalence of cataracts in such groups of work- Glare on the screen Flicker and jitter ers. No long-term study has yet shown either Resolution of characters clinically observable changes in the eye func- High contrasts between source document and screen Tasks requiring long continuous looks at the screen tions or pathological changes in the eye. without a break There is evidence that work at a VDT leads Air humidity 62 High visually demanding task, like data entry and data to more frequent changes in eye glasses. This acquisition has been attributed both to the aging of the Low control jobs where the worker is unable to take a workers, and to a greater tendency for VDT break to relieve the load on the visual system

NOT = A~though the professional who wo~ks-at the VDT IS not as llke~y to report workers, as compared to others, to identify as many vtsual problems as people doing data entry acqulsltlon or dialog minor visual problems. A possible alternative tasks It IS important to recognize they tend to report more symptoms than workers not us I ng [he V DT For a comprehensive revl ew of the I I terat u re explanation is the development of acquired my- see Ulf Bergqvlst, ‘Video Display Terminals and Health A Technical and Medical Appraisal of the State of the Art Scancffnavfarr Jouma/ of Work opia (nearsightedness), which is characteris- Errv/ronrnenf and Hea/th VOI 10 SupP 2 1984 tic of close visual work such as reading. If SOURCE Off Ice of Technology Assessment working at the VDT is found to increase the chance for acquired myopia, the visual health Table 5-5.—Visual System Outcomes: of a large sector of the population will be af- Known Acute or Potentially Chronica fected. As the debate about the effects of VDTs on the visual system of workers continues, Known acute outcomes: there is a growing need for a well-designed lon- Asthenopia:b Burning eyes gitudinal study to determine whether the acute Itching eyes conditions persist. Since little is known about Irritated eyes potential biological or biomechanical mecha- Perception problems: Double vision nisms for the initiation of pathological changes Blurred vision in the visual system attributable to new of- Potential chronic outcomes: fice technologies, research should also focus Acquired myopia here. a There are no c-h ron IC outcomes that have been observed I n any c I In Ical Invest I gallons of VDT operators Eye exams are recommended by the Na- bAStheflOpla IS a term used to describe vtsual fatigue or weakness NO clear defl n It Ion of visual fatl gue IS employed In the research and it Is sometl mes referred tional Institute for Occupational Safety and to as visual strain SOURCE Off Ice of Technology Assessment Health (N IOSH) before beginning VDT work and periodically thereafter. G3 In many in- a terminal is directly proportional to the number of workers reporting symptoms and to the “’National Research Council, Video Displays, Work and Vi- extent of their complaints. That complaints sion: Panel on the Impact of Video Viewing on Vision of Work- ers (Washington, DC: National Academy Press, 1983). How- cannot be tied to organic change does not, in ever, in a recent workers’ compensation case, the worker received other words, mean that they are not “real.” an award for incipient cataracts. The workers compensation There is also evidence that visual problems board found there was a recognizable link between the employee’s occupation and disability-see, Legal Rights for VDT Users can influence the development of musculoskele- (Cleveland, OH: Working Women Educational Fund, 1985). tal symptoms. The acute outcomes in table “Wlf Bergqvist, “Video Display Terminals and Health: A 5-5 can be reduced with changes in the work- Technical and Medical Appraisal of the State of the Art, Scan- dinavian Journal of Work, Environment, and Health, vol. 10, place, such as appropriate lighting levels, com- SUpp. 2, 1984. puter terminal design, workstation and job re- ‘ ‘J. Donald Millar, Assistant Surgeon General and Director design, and prescriptions to correct refractive of N IOSH, Statement before the Subcommittee on Health and Safety, Committee on Education and labor, U.S. House of Rep- errors. resentatives, May 15, 1984. stances, visual complaints are in part due to one of the major categories of self-reported uncorrected refractive errors. Eye examina- complaints by VDT workers, a high percent- tions would identify and allow correction of age of whom report pains, stiffness, cramps, this problem. There is no evidence as to how and numbness in the back, neck, shoulder, often eye exams should be given for good visual arms, and hands. Comparison with other of- health. They are particularly important for peo- fice workers reveals an association between ple over 40 years of age, when the visual sys- VDT work and increase in self-reported symp- tem begins to change with the onset of pres- toms in specific types of office work.66 byopia (farsightedness). Table 5-6 shows factors that have been found to be associated with musculoskeletal system Musculoskeletal System Outcomes outcomes among VDT operators. Few studies have weighed the relative contribution of each Musculoskeletal disorders rank very high 67 among health problems in the frequency with factor. Characteristics of the individual, which they limit activity.64 Over 10 million peo- workstation design, and the work process are ple report limitation of activity due to mus- associated with the reported symptoms. There culoskeletal disorders as compared for exam- is a suggested association between length of time at the VDT and an increased levels of ple with about 7 million reporting limitation 68 of activity because of circulatory problems. reported musculoskeletal symptoms, but the Musculoskeletal disorders are the leading current scientific evidence is inadequate to cause of disability of people in their working demonstrate a causal relationship between any years. From 1973 to 1983, industry data sources report low back pain as the primary ‘‘ The data usLId to make the ohsertat ion are inadequat~~ t{) cause in 20 to 25 percent of the yearly work- make an}. strong asscr-tion across all j ohs where the worker ers compensation cases.65 As the working uses the computer terminal. ‘ I’Tor example, stx’ S, 1,. Sauter, et al., “tJoh and ] ]ealth I nl- population ages, the prevalence of musculo- plicaLions of \’I)rI’ (Ise: Initial ltesults of the \$’isconsin-N 10S1 f skeletal disorders and the potential costs to Stud~’, (’(jrllr~][lni(’:iticjns of t he.4 sscxiat ion of Comput kg .ll:/- individuals and society increase. chinar~-, I.ol. 26, pp. 2H 1-2!)4, 19H~l. ‘“Nl ichael .J. Smith, ‘‘ I;rgonomi( and Str~’ss Aspects of ( )f - No recent data are available to provide more fice .,\ut omation, paper presented at t }1(’ of ficv of ‘1’echnolo~?’ SJm~posiunl on the 1 mpacts of office )\uton~ation and (’onlputer- accurate estimates of the extent of musculo- Nlediated W’ork on the Qualit} of W’orklife. I)ec. 1 ()- 12, 1984. skeletal disorders in the aging U.S. population, and there is no breakdown of the older data by occupation. Therefore it is difficult to estimate the impact office automation has Table 5.6.— Individual and Work Environment Factors had on the prevalence of musculoskeletal dis- Associated With Musculoskeletal Outcomes orders. A national data collection system is needed to determine the contribution of the work- Individual: Age place to the prevalence of musculoskeletal sys- Existing musculoskeletal disorders tem outcomes. Visual system characteristics” Near-s ightedness NIOSH has identified musculoskeletal dis- Presbyopla orders of an occupational origin as one of the Bi or trl-focal eyewear use during VDT operation a top ten health problems affecting workers Work environment: VDT/workstation-user interface” today. Over the past 15 years, they have been Keyboard and hand — — Body and chair ‘‘,Jennifer Ii. Kelsey, Epidemiology?’ of ,}lusculoskeletal I)is- Eyes and screen orders, Llonographs in ~;piden~iolog~’ and Hiostatist i~.s, YTO1. Repetitiveness of task(s) l] ~ New York: oxford Uni\ersit~ Press, 1982). Length of time spent at task(s) Cited in Charles F. Spakell and ~$’illiam F. N1cKeon, “ Pre- Extent of physical constraints \’enting I,ow f] ack f)ain in I ndustr~, Bu.w’ne.s.s and }Iealth. aT hese factors .+ I I I be d I sc u ssed r more det aI I I n ! he sect Ion on A orh ~ t df [j n Jo], 2, No. 6, 19x5, pp. 16-19. This is supported h~’ unpublished desl q I anrj t h e q u al I t ~ of $, orkl I fe anal~’ses of H 1..S data. SOURCE Of f!ce of Technology Assessment characteristic of the automated office and any the level of self-reported symptoms corresponded musculoskeletal system outcome. 69 to physician-observed abnormalities. There is, however, no evidence from studies of office Acute musculoskeletal system outcomes are workers using VDTs display that self-reported listed in table 5-7. Back, neck, and shoulder outcomes predict clinically recognizable changes problems are reported more frequently (50 to in the musculoskeletal system.7l There is a need 80 percent of VDT operators) than arm, wrist, for research to clearly identify the relation- and hand problems (20 to 40 percent of VDT ship between reports of musculoskeletal out- operators). This ranking of self-reported symp- comes by the worker and medically verifiable toms by site corresponds to a ranking based 70 outcomes. on a national sample of U.S. adults. Further- more, in the national sample it was found that Based on the current scientific evidence, it is impossible to determine whether the acute “’Although no experiments have been conducted showing a outcomes listed in table 5-7 lead to any patho- causal relationship between new office applications and mus- logical changes in the musculoskeletal system culoskeletal outcomes, there are biologically plausible explanations; for example, the experience of pain and discomfort or to any disability for workers in automated by the worker who sits at the terminal for extended periods offices. The chronic outcomes reflect poten- of time in constrained postures. Static loading of muscles re- tial long-term consequences based on evidence sults from the efforts of the human body to maintain a fixed posture for extended periods of time. This keeps the muscle from other occupations and biological and bi- in a constant state of contraction instead of a dynamic state omechanical evidence. Potential long-term con- of contraction and relaxation. Thus, waste products build up sequences of new applications of office tech- in the muscle and blood is not circulating in the muscle to provide the needed nutrients. This results in cramping and pains. nologies for the musculoskeletal system must Tichauer has shown that the peritendinitus that occurs in the be considered. As Kelsey notes: lower arm of typists is caused by excessive static workload. (E.R. Tichauer, “Biomechanics Sustains Occupational Safety [Impairments of the back and spine and ar- and Health, ” Industrial Engineering, vol. 27, 1976), pp. 46-56. thritis and rheumatism account for the great- “’I,inda S. Cunningham and Jennifer L, Kelsey, “Epidemi- ology of Musculoskeletal Impairments and Associated Disabil- est amount of time lost from work. In 1976, ity, ” American Journal of Public l{ealth, vol. 74, No. 6, 1984, it was reported that a reduction of one day pp. 574-579. per year in the average annual absenteeism rate among the labor force of the United States would increase the gross national product (GNP) Table 5.7.—Musculoskeletal System Outcomes: by $10,000 million. Accordingly, the GNP Acute or Potentially Chronic would have increased by $19,000 million had musculoskeletal disorders been prevented.7z Known acute outcomes: - Pain in shoulder If absenteeism rates can be affected by de- Cramps in arms and legs sign of new office technologies, this has far Pain in back: Upper reaching implications for health care costs. Lower Therefore, research should be conducted to de- Cramps in shoulder and neck muscles (stiff neck) termine the relative contribution of office auto- Soreness, tingling or numbness in wrist and fingers mation to the incidence of the chronic outcomes Potential chronic outcomes:a Cervicobrachial syndromeb listed in table 5-7. Prolapsed lumbar intervertebral disc Cumulative trauma disorders’ aThe Cbrofl!c outcomes have not been observed In my Population Of Office workers They are potential chronic outcomes based on self. reported acute musculoskeletal outcomes and biological and blomechanical plausibility bcewlcobrachlal syndrome IS a term used to define a cluster of signs In the shoul der and neck region It IS a functional and organic disorder occupationally produced on the bas!s of muscular and mental fatigue resultlng from stat!c and/or repetitive exerilon of the arm and hand muscles Chronic pain can result ‘Studies that have attempted to correlate self-reports with from the compression of nerves In the neck radlatlng down the arm medical exams have not demonstrated a clear relationship. For ccumulatlve trauma dtsorders are a class of musculoskeletal outcomes, that are an example see the work of W. Hunting, T. Laubli, and E. Grand- potentially Important Those In the literature associated with office workers are tenosynovltls and carpal tunnel syndrome Carpal tunnel syndrome is a disorder jean, “Postural and Visual Loads at VDT Workplace, I, Con- of the wrist In which the median nerve IS compressed against the transverse strained Postures, ” Ergonomics, vol. 24, No. 12, 1981, pp. carpal Ilgament wlthln the carpal tunnel 917-931. SOURCE Off Ice of Technology Assessment “Kelsey, 1981, op. cit., p. 7. —— —..

Ch. 5—Office Automation and the Quality of Worklife ● 143

Photo credit Communlcat(ofls Wor/ters of America

Workers adjust to their working conditions. Sometimes this can lead to musculoskeletal strain,

The first two, cervicobrachial syndrome and These are the wear and tear disorders. Many prolapsed lumbar intervertebral discs, can po- of the early warning signs (tingling, numbness, tentially develop among either professionals and pain) of these chronic conditions can be or clerical workers.73 They can be related to alleviated with changes in the working condi- increased time spent sedentary and in con- tions. 74 strained postures, which could be blamed on There is a relationship between visual sys- the job or the design of the office or worksta- tem outcomes and musculoskeletal system out- tion, but most likely is related to all three. comes. For example, a person who is near- Cumulative trauma disorders are more likely sighted most likely will get a pair of reading to develop among workers doing highly repeti- glasses that typically allow the person to read tive keying operations at the VDT for extended clearly at about 33 cm. However for work at periods of time, mostly data-entry clerks who the VDT, a person is on average only as close key as much as 12,000 keystrokes per hour. as 50 cm from the screen. The worker then —————-—— leans forward, and the posture results in mus- “A prolapsed intervertebral disc occurs when the nucleus pulpous of the disc protrudes outside the annulus fibrosis. The disc tends to protrude onto a nerve root causing pain. In the “Much of the research on the prevention of cumulative lumbar region this pain radiates down the leg. Kelsey estimates trauma disorders is based on redesign of the machines in as- the incidence of prolapsed lumbar intervertebral disc at around sembly line operations. See %eventing Illness and Injury in 0.1 to 0.5 percent per year (Kelsey, op. cit., 1981, p. 151) in the M’orkplace (op. cit. ) for several examples of the prevention the population of ages between 24 and 64 years. projects. 144 ● Automation of America’s Offices

culoskeletal strain. As the pain gets worse is between 10 and 20 percent.78 No site has through the day, the worker adjusts by mov- enough data to show conclusively any asso- ing her body back in the chair, increasing the ciation between office automation and any ad- visual distance, which can lead to visual strain. verse reproductive outcome.79 NIOSH recommends that a worker take peri- A Finnish study looked at the relationship odic rest breaks every 2 hours when doing work between occupation and spontaneous abor- at the VDT to prevent acute asthenopia and tions, and found that industrial and construc- musculoskeletal fatigue.75 This can be enforced tion workers had one of the highest ratios through organizational rules, through a job (13.01), and clerical and managerial workers redesign strategy giving the worker a variety one of the lowest estimated ratios for spon- of tasks to break up the VDT work, or by al- taneous abortions (9.91);80 the lowest ratio was lowing the worker the discretion to take breaks in administrative work (8.16). when she feels the need. The last is especially Two studies in Sweden and Japan examined advantageous in settings where the work is the relationship between VDT work and re- unpredictable or there is a high worker-to-VDT productive system outcomes. Little informa- ratio with competition for terminals, but may tion is available on the Japanese study .8’ The demand more flexibility than an organization Swedish study infers VDT exposure from oc- would normally provide. Sometimes people will cupations; the measure of work at a VDT is not take breaks unless they are required. 82 indirect. Nevertheless, this retrospective

Reproductive System Outcomes 7KIn an analysis of the ability of women to recall whether they had a spontaneous abortion or not; one in four cases of Many occupational hazards affect the repro- spontaneous abortion was not reported. Gestational age of the 76 time of abortion was the major determinant of recall. Allen ductive system. The concerns about the re- J. Wilcox and Louise F. Horney, “Accuracy of Spontaneous productive hazards of working in an automated Abortion Recall, ” American Jourmd of Epidemiology, vol. 120, office focus primarily on the VDT. Most of No. 5, 1984, pp. 727-733. “’There are several methodological prclblems with examin- the early studies considered only female oper- ing reproductive hazards in the workplace. First is the problem ators, but both genders should be considered of selection bias. It is known that a predictor of an adverse in discussing reproductive system outcomes. pregnancy outcome is prior adverse outcomes. Women who have a full-term pregnancy tend to leave the work force, and there- The concern over working at the VDT de- fore women with prior adverse pregnancy outcomes will be over represented (Gosta Axelsson “Selection Bias in Studies of Spon- veloped because of reported clusters of spontaneous Abortion Among Occupational Groups, ” Journal of taneous abortions and birth defects among Occupational Medicine, vol. 26, No. 7, 1984, pp. 525-528). VDT operators. Table 5-8 shows a list of the “’The ratio is calculated as the number of spontaneous abortions times 100 divided by the number of births. K. Hemminki, work sites where these clusters have been re- M. L. Niemi, I. Saloniemi, H. Vainioh, and E. Hemminki, “Spon- ported. No adequate explanation has been taneous Abortion by Occupation and Social Class in Finland, ” offered for these observed clusters,77 which in- International Journal of Epidemiology, vol. 9, No. 2, pp. 149- 153, 1980. clude a wide variety of pregnancy outcomes “’Conducted by the General Council of Trade Unions, it has with the majority being spontaneous abor- only been reported in “Japanese Miscarriages Blamed on Com- tions. The estimated prevalence rate for spon- puter Terminals, ” New Scientist, vol. 106, No. 1457, 1985, p. 7. Among 4,500 women, 250 became pregnant or gave birth taneous abortions in the general population after work at the VDT and 91 had problems with pregnancy. There was a reported association between hours per day, work — at the VDT, and problems with pregnancy or labor: for more ‘r’-M-ifiar~_op. cit.; this recommendation has been challenged than 6 hours VDT work per day—66 percent had problems; in the scientific community. for 3-4 hours VDT work per day–46 percent had problems; “bFor a complete listing and a discussion of the potential for less than 1 hour VDT work per day–25 percent had prob- control technologies see Reproductive Hazards in the Work- lems. It is impossible to draw any conclusions from this data place, Office of Technology Assessment, Washington, DC, 1985. since no information on the research design is known. ‘-The argument is made that these clusters are chance “JBengt Kallen, An Epidemiologic Study of Work With occurrences. The rate of spontaneous abortions is not at odds Dataterm”nals and Pregnancy (En Epidem”olog”sk Studie over with the normal rate that occurred during the time period of Arbete med Dataskarm och Graviditet), translated by Anita the reported clusters. For a lengthy statistical discussion on Dvorak, research report from the University of Lund, Sweden, this see Bergqvist, op. cit. 1985. Data reported herein is taken from a second report, Ad (continued on p. 146) Ch. 5—Office Automation and the Quality of Worklife 145 .

Table 5-8.—Reported Cases of Reproductive System Outcomes in Computer-Mediated Workplaces by Work Site and Job

Company Outcomes city (date) Job VDT Non~VDT Sears-Roebuck/ - Financial records 2 miscarages i miscarriages Dallas, TX processing clerka 4 full -termb 1 premature birth (5/79-6/80) 8 full-term Toronto Star/ Classified ads 4 birth defects 3 full-term Toronto, Ontario processing clerks (5/79-5/80) C Air Canada/ Part-t i me 7 miscarriages NIA Montreal, Quebec ticket agents 6 full-term (2/79-4/81) Defense Department/ NIA 3 birth defects NIA Marietta, GA 7 miscarriages (10/79-10/80) 5 full-term Defense Department/ NIA 14 full-term NIA Marietta, GA (10/80-10/81) Pacific Northwest N 1A 2 birth defects N 1A Bell Telephone/ 1 still born Reston, WA (7/80-12/81) Solicitor General NIA 4 miscarriages 1 full-term Offices/Ottowa, 1 premature Ontario 2 respiratory diseases (4/79-4/82) Surrey Memorial Accounting 3 miscarriages NIA HospltallVancouver, department clerks 1 birth defect British Columbia 1 premature (1978-82) 1 bronchitislful l-term 1 full-term Toronto, Old City Clerks 10 miscarriages N 1A Hall Secretaries 9 full-term Ministry of Attorney General (1980-81) United Airlines/ Airline 23 miscarriages NIA San Francisco, CA reservation 61 full -termd (1984) clerk Southern Bell Telephone 7 miscarriages 26 miscarriages Telephone/Atlanta. operators 15 full-term 159 full-term GA (3/81-9/83) General Telephone/ Telephone 12 miscarriages NIA Alma, Ml operators 2 still births (1983-84) 3 premature 15 full-term Library/ NIA 8 miscarriages NIA Aarhus, Denmark 2 full-term Department of Public Full-time 8 miscarriages NIA Employees/Runcorn, VDT operators 4 still births England 12 malformations (1974-82) a Compares on Iy fu I I.t[ me VDT operators with non-VDT operators who may have worked as much as 6 hours per month at the terminal bFul{ term refers t. the healthy dellvery of a newborn after three trimesters These are commonly termed Ilve births CN 1A means no lnformatton reported dTh, s excludes 23 Induced abortions and 9 full-term del!venes of wives of employed men SOURCE Off Ice of Technology Assessment, compiled from several repofts and news sources 146 ● Automation of America Offices study found that women who worked at the currently sold terminals.85 Ionizing radiation VDT were 50 percent more likely to have mis- from the VDT is not a likely explanation, ac- carriages (crude risk ratio was 1.5 with 95 per- cording to NIOSH, the Federal Drug Admin- cent confidence limits of 1.1-1.9) than other istration, and the Government of Canada.86 The women of similar age and occupational group. possibility of nonionizing radiation must be With adjustment for smoking and stress, con- considered; but future developments in flat fidence in the risk ratio being greater than one panel display technologies may eventually decreased.83 For all types of adverse reproduc- replace cathode ray tubes as the dominant tive outcomes, there was a significantly greater human-computer interface. risk for those who spent over 40 hours per week Recent concern has focused on very low fre- at the VDT. This suggests that further inves- quency radiation, particularly the magnetic tigations are needed that directly measure pulse generated from the coil of the cathode VDT work and follow a group of men and non- ray tube. This concern developed because pregnant women to see whether there is an studies in Spain related a magnetic pulse to excess of adverse reproductive system out- morphological abnormalities in chicken em- comes. No epidemiological study has provided 87 bryos. The evidence has not been confirmed reliable data comparing VDT to non-VDT in any other investigation trying to reproduce operators. the patterns of electromagnetic radiation emit- Two explanations other than chance have ted from a VDT.88 Currently, there are inter- been offered for the clusters–stress, and ra- national efforts to study the effects of pulsed diation emissions. There is no epidemiologi- electromagnetic exposure on chick embryo de- cal evidence linking stress in office work (either velopment, but measurement of this and other physical or mental) to spontaneous abortions forms of nonionizing radiation in the field is or still births. But while no evidence exists, difficult. Further research should be concerned no research has thoroughly explored the issue. with the development of reliable instruments for the monitoring of radiation being emitted The greatest interest has been in the impact from VDTS. of radiation84 and whether radiation from the VDT is the single source exposure. There is Based on current evidence, no long-term risk no evidence that ionizing radiation above es- is associated with very low frequency radiation tablished safe thresholds is being emitted from emitted from the visual display terminal, but continuing evaluation is warranted in light of —— Hans Malker, Critical Comments on the Report “An Epidemio- ‘r’ William E. Murray, “Video Display Terminals: Radiation logica/Study of Work With Video Screens and Pnsg-nancy Out- Issues, ” IEEE Computer Graphics and Applications, April comes, ” Memorandum, Swedish National Institute of Occupa- 1984. tional Safety and Health, Feb. 2, 1985. “’Millar, op. cit.; FDA, Drug Bulletin, vol. 14, No. 1, April “This risk ratio dropped only 10 percent when the effects 1984; Environmental Health Directorate, Investigation of Ra- of smoking and stress were entered into a logistic regression diation Em”sw”ons From Video Display Term”nals, Department analysis (adjusted risk ratio 1.4 with 95-percent confidence limits of National Health and Welfare, Ottawa, Canada, 1983. of 1.0-1.8). No data was reported on the effects of chemical ex- ““This evidence comes from two reports: J.M.R. Delgado, J. posure or heavy lifting on the relationship of work at the VDT Leal, J.L. Monteagudo, and M.G. Garcia, “Embryological and miscarriages. If the relationships persist after adjusting Changes Induced by Weak, Extremely Low Frequency Elec- for these potential confounders along with other predictors of tromagnetic Fields, ” Journal of Anatomy, vol. 134, 1982, pp. miscwriages (e.g., prior spontaneous abortions ~d parity) then 533-551; and A. Ubeda, J. Leal, M.A. Jimenez, and J.M. R. Del- the researchers can make a stronger inference. This will always gado, “Pulse Shape of Magnetic Fields Influences Chick Em- be limited by the absence of a direct measure of VDT use. bryogenesis, ” Journal of Anatomy, vol. 137, 1983, pp. 513-536. “Three major types of radiation are associated with biologi- *“Arthur W. Guy, Health Hazards Assessment of Radio cal effects. They differ by the energies involved. Ionizing radi- Frequency Electromagnetic Fields Em”tted By Video Display ation has the most energy and is known to cause cancer and Terminals, report prepared for IBM Office of the Director of birth defects. Microwaves and radiofrequency nonionizing ra- Health and Safety, 1984; Kjell Hansson Mild, Personal Com- diation have been associated with fertility problems and blood munications, Swedish National Board of occupational Safety abnormalities. Extremely low frequency and electromagnetic and Health, 1985; S. Maffeo, M.W. Miller, and E. L. Carsten- nonionizing radiation is the least energetic of the three catego- sen, “Lack of Effect of Weak Low Frequency Electr~Magnetic ries and has not been associated with any adverse biological Fields on Chick Embryogenesis, ” Journal of Anatomy, vol. 139, effects. No. 4, 1984, pp. 613-168. Ch. 5—Office Automation and the Quality of Worklife 147

Table 5-9.—U.S. Occupational Exposure Standards MHz is 100 mW/cm2. This threshold level is 10 times higher than the VDT emissions in Occupational exposure Radiation type standard Source the 0.01-100 MHz range measured in a study X-ray ... 2,5 mR/hr OSHA’ by the Bureau of Radiological Health of the .90 Ultraviolet (near) ., 1,000 microW/cma ACG I H “ Environmental Protection Agency The In- Visible 2.920 fL ACGIHh ternational Radiation Protection Association Radiofrequency electromagnetic fields, (IRPA) standards are 10 times lower for a sim- frequency range (MHz) ilar frequency range than standards set by AC- 001-3 100 mWlcmb ACGIAb GIH (0.01-3 for ACGIH and 0.01-1 for IRPA). 10-100,000 10 mWlcmb OSHA’ Because there are differences in the limits of aCo(j~ of Federal Requ Idt Ions TI tle 29 Chapter XVII Part 191096 Ion!zt ng Rad dt I o n Occ u pat tonal Safety and Health Ad m I n $1 rat (on Washl ngton DC 1980 exposure, the standards should be constantly hTh rpsho(cj Llrn!t for Cherntcal Substances and phy SICEil Agents lr~ tne ‘@JOrk El ,v!, onment Wlt h I nt ended Changes for 1983 and 1984 American Conference ‘or reexamined in the light of further research. Go~ernment Indusl1-10. . . . 10/Fa system outcomes as they relate to occupations. >10-400. 1 The establishment of such a system could help >400-2,000 . F a/400 >2,000-300,000 ...... prevent the public fear that has arisen about — 5 aF refers to the frequency tn Mfiz thus 10 calculate the speclflc I Imtt wlthln the VDT work. range the frequency must be factored In accordinq to the expression SOURCE International Non Ion!zlnq Radlatlon Commlltee of the International Metallic shielding has been discussed as one Radlat[on Protecllon Association Interim Guldelhnes on Llmlts of Ex pos,ure to Radlofrequency Elect romagnetlc Fields (n the Frequenc Y way to avoid any possibility of radiation be- From 100 KHZ to 300 GHz Hea/th Phys{cs VOI 46 No 4 1984 pp ing absorbed by the operator, especially shield- 975984 ing the flyback transformer. This shielding is the large number of people exposed, to see if relatively inexpensive and is usually provided in newer models to satisfy FCC requirements modified or new standards need to be devel- ] oped.89 for reducing electromagnetic interference.’ Standards shown in table 5-9 reflect the The government of Sweden has recommended available evidence on the potential effects of that any pregnant employee have the right to chronic exposure at low levels. The American be moved, at full pay, to a job with no exposure Conference of Government Industrial Hygien- until the baby is born. The International La- ists (ACGIH) exposure limit for electromag- bor Organization recommends that a worker netic fields in the frequency range of 0.01-3 who is considering becoming pregnant be allowed to transfer to another job.92 However, ““A recent report from the U.S. Environmental Protection the risk of reproductive system damage, if it Agency concluded there were no consistent biological effects at the molecular and subcellular level in laboratory experiments. exists, may be just as great for a man as for The report suggested continued revision of general conclusions a woman. Most recently, the Service Employ- because of limited knowledge about chronic low-level exposures ees International Union (SEIU) has negotiated and the existence of frequency-specific effects and power-density windows. (U.S. Environmental Protection Agency, Biolo@”cal “’’Cited in fieproducti~e Hazards in the 11’orkplace, op. cit. Effects of Radiofrequency Radiation, Joe A. Elder and Daniel “’Guy, op. cit. F. Cahil (eds. ), EPA-60018 -83-026F (Research Triangle Park, ‘-International I.abor Organization, Guidelines for \’DT’s, NC: Health F~ffects Research Laboratory, 1984). ) (~ene~’a, Switzerland, 1985. 148 ● Automation of America Offices in collective bargaining with Equitable Life Stress-related outcomes can be divided into Insurance the rights of employees to leave those that are acute and transient95 and those VDT jobs where the believed risk for an ad- that are persistent and enduring. Anxiety and verse pregnancy outcome is high. These meas- depression have been shown to be related to ures would at a minimum alleviate fears. myocardial infarction, angina pectoris, and coronary death.96 Therefore, correction of work- Stress-Related Outcomes ing conditions that produce these stress responses can help to prevent stress-related dis- Work-related stress is not new to offices, but eases.97 recent epidemiological evidence has called attention to the potential long-term consequences As important as are acute conditions, the of stressful office working conditions. One potential for chronic diseases is the key pub- study of the health records of 22,000 workers lic health issue. The population potentially at in 130 occupations found that clerical work- risk in offices is large. If conditions that can ers had the second highest rate of stress-related lead to chronic illness and disease can be iden- diseases.” Analysis of the Framingham Heart tified, management can use this information Study data showed that women clerical work- to guide implementations. ers developed coronary heart disease (CHD) The biological plausibility of changed work- at about twice the rate of other women working conditions leading to a pathological change ers and women at home.94 The workplace fac- in the body has been the subject of debate for tors that predicted the development of CHD decades. Chronic arousal is one currently ac- among clerical workers were a nonsupportive ceptable biological pathway (see box B for an boss and low-job mobility. Any conclusions example of a plausible link to disease). Chronic about the contribution of the new office tech- arousal is a biological adaptation to the envi- nologies to the incidence of disease must thus ronment. When one continues to respond daily consider that women clerical workers were al- to the same stimuli, arousal can become part ready at a greater risk for the development of the normal biological adaptation to, for ex- of certain stress-related diseases. The new tech- ample, work— a method of activating the nology may or may not intensify those char- body’s resources to meet the demands. This acteristics of the work environment that are can lead to a form of ‘healthy maladaptation, associated with the elevated risk, increasing in which the worker completes tasks, but at one’s chances of developing disease; they could some biological costs. The eventual cost can also improve working conditions, decreasing be illness due to lowered immunological resis- the likelihood of disease. tance, or chronic illness that lowers the abil- There are no reliable estimates of the costs ity to perform, such as cardiovascular disease to the organization or to society of stress-re- or peptic ulcers. The danger is hidden in that lated illnesses, absenteeism, tardiness, em- the chronic heightened state of arousal does ployee turnover, decreased quality and quan- ‘ Stress can contribute to the development of acute visual tity of output, unscheduled machine downtime and musculoskeletal system outcomes. For example, muscle (due to employee tampering) and worker’s com- fatigue can be the direct result of a stressful working condi- pensation awards. These outcomes can lead tion, which can stimulate brain stem activity, which in turn to increased medical care costs and decreased can cause muscle fatigue. “C. David Jenkins, “Psychosocial and Behavioral Factors, ” organizational effectiveness. Prevention of Coronar~’ Heart Disease: Practical Management of the Risk Factors. Norman M. Kaplan and Jeremiah Stamler 4{ ‘ Mich~ei J. Smith, Michael J. Colligan, and J.S. Hurrell, (eds. ) (Philadelphia: W. B. Saunders, 1983), pp. 98-112. “A Review of NIOSH Psychological Stress Research–1977, ” ““This type of prevention strategy may be found to be the (lccupatiomd Stress: Proceedings of a Conference on Occup,~- most cost-effective, since it has the potential to reduce the long- tional Stress (Washington, DC: U.S. Government Printing Of- term development of disease. Also, if the working conditions fice, 1977). that produce stress responses in workers are modified, this may ‘ (’Suzanne G. Haynes and Manning Feinleib, “Women, alter certain behavioral outcomes including smoking, drinking, Work and Coronary E{eart Disease: Prospective Findings From and overeating—all considered socially acceptable ways to cope the Framingham Heart Study, q American Journal of Pub]IcS with the stresses of life, but primary determinants of prema- }Iealth, Iol. 70, 1980, pp. 133-141. ture morbidity and mortality. Ch. 5—Office Automation and the Qualify of Worklife 149

Box B.—Chronic Arousal: The Link Between Working Conditions and the Natural History of Disease, The Case of Cardiovascular Disease* Early theories of stress and disease held that humans instinctively respond to challenging conditions from their environment through activation of pituitary and adrenal gland functions. Walter Cannon in the 1930s showed the importance of the sympathetic adrenal system in the flight-or-fight syndrome. He showed there were limits to how well the system could adapt to stimuli; afterwards bodily harm could result. OnIy in the last 20 years have scientists begun to unravel the complex interrelationship between the brain, immune system, and endocrine system. There are competing models of this complex system, but several conclusions can be stated. Sympathetic adrenomedullary (SAM) stimulation is accompanied by evaluated blood pressure and heart rate, heightened myocardial oxygen requirements, increased levels of circulating epinephrine (E) and norepinephrine (NE), elevated plasma concentrations of free fatty acids (FFA), and increased plasma renin activity. These can predispose the individual to cardiovascular disease (CVD). The release of the neuroregulator, catecholamine, as a consequence of SAM activity is central to the most prominent theories of stress and CVD. In its efforts to mobilize reserve energy resources, catecholamines hydrolyze triglyceride stores into FFA and glycerol. FFAs are either utilized in the production of energy or taken up by the liver and adipose tissue then resynthesized into triglycerides that are secreted as a component of very low-density lipoproteins (VLDL). VLDLS have been shown to be significant components of the atherosclerotic process. When catecholamines are chronically secreted in great excess of the body’s energy requirements to meet the demands of the work environment, the abundance of FFAs can ultimately result in damage to vascular walls caused by circulating VLDLS. Damage to vascular endothelium can also occur as a result of increased arterial blood pressure or turbula.nce caused by SAM hemodynamic responses. Damaged vascular endothelium is more susceptible to atherosclerotic deposits than healthy vessel walls. These processes suggest several possible pathways between the challenges created by working conditions and the development of cardiovascular disease.

a’1’hig Sxtion is bas~ on a S1.lrnrnary prepared by Dr. Andrea LaCroix. For a full description see Andrea LaCroix, Occupation Ex~sure to High Demand/Low Control Work and Coronary Heart Disease Incidence in the Frarm”ngham Cohort, doctoral dissertation, University of North Carolina, Chapel Hill, 1984. A more complete description of the various biological procesaes can be found in The Institute of Medicine, Research on Stress and Human Health (Washington, DC: National Academy Fress, 1981). not necessarily correlate with the worker’s atti- and workload and control. In a 6-year prospec- tudes about work. High motivation and satis- tive analysis, men with jobs characterized by faction does not obviate the possibility that a heavy workload and limited job control were a person could be at risk. found to have 1.4 times the normal risk of CVD morbidity.98 In a case-control study of my- Three working conditions have been associ- ocardial infarction and occupational exposures, ated with chronic arousal: it was found that hectic work and low control ● social isolation or lack of social support; over work tempo and skill variety were asso- lack of control over the timing, speed, and ciated with myocardial infarction in men un- variety of tasks; and der 55.99 In a study of Swedish workers who heavy workload (especially repetitive and had changed jobs, those whose new job had machine-paced tasks). greater control had fewer coronary symptoms Each of these conditions has also been postu- lated as likely to arise from office automation. “’The CHD morbidity measure was a self-report indicator of chest pain, dyspnea, hypertension, and heart weakness. R. Kara- No evidence has shown that all three must oc- sek, et al., “Job Decision I.atitude, ,Job Demands, and Cardi- cur to elicit deleterious biological responses; o}’ascular Disease: A Prospective Stud} of Swedish N!en, Amer- however, in some jobs they all occur. ican Journal of Public l{ealth, \ol. 71, No. 7, 1981, pp. 694-70,5. ‘II. A] fredsson, et a],, “M~.ocardial Infarction and I)s~’cho- Epidemiological evidence has shown the social Jt’ork l~nyironment: An Analysis of the Male Swedish Mrorking Force, ” Social Science and Aledicine. \’ol. 16, 1 W2, most consistent links between heart conditions pp. 463-467. 150 ● Automation of America’s Offices than workers whose new job had less control.l00 little control over pace, a heavy workload, and In the only American prospective study, wom- lack of social support. This is consistent with en who described their job as having a heavy the general literature on stress-related disease. workload with limited job control had a three- No study can fully answer the question—what fold greater risk of developing coronary heart contribution to the risk of disease can be at- disease (CHD) as women reporting a heavy tributed to office automation? workload but having control over their work. But two recent studies suggest that there Men did not exhibit the same relationship. At is a potential for these psychosomatic symp- greatest risk were clerical women, who had a toms to develop into chronic conditions. In 420 percent greater chance of developing CHD a cross-sectional study of clerical workers in (relative risk 5.2 with 95 percent confidence the communications industry, those who worked interval of 1.80-15.08). These associations per- at the VDT were at about a two-fold greater sisted after controlling for the traditional risk 103 101 risk for the development of angina pectoris. factors for CHD. This is the first study to demonstrate a rela- Based on the available evidence, lower level tionship between automated office work and staff appear to be at greater risk for the devel- a valid precursor of CVD. A second study of opment of stress-related diseases. This how- Finnish workers found that workers in auto- ever need not be true with office automation mated offices were at a 106 percent higher risk because the changes in the working conditions (relative risk 2.06, 95 percent confidence in- can affect all levels of staff. Alternatively, of- terval 1.43-2.69) for one or more chronic ill- fice automation can be implemented so as to nesses. 104 These projects point to the need to add control and encourage more social inter- examine the potential effects of office auto- action. mation to determine under what conditions a worker is likely to be at a greater risk for Currently, the evidence for a relationship be- the development of a chronic disease. tween stress-related diseases and VDT work is still sparse. A principle problem in drawing —. “’’The analysis of angina was restricted to a sample of 650 conclusions is that the long latency of chronic women. There were no significant differences between respond- diseases prevents early recognition. However, ents and a 10-percent sample of nonrespondents. For a full in the natural history of disease certain early description of the results of the study along with the limitations of the study see, Suzanne Haynes and Andrea LaCroix indicators could be expected such as psychoso- (University of North Carolina at Chapel Hill), “A Cross-Sectional matic symptoms (sleeping problems, dizziness, Study of the Health of VDT Operators in the Telephone Indus- nausea, and stomachache), high blood pressure try, ” unpublished manuscript, 1985. The measure of angina 102 used was the Rose Angina Questionnaire. Several studies have or angina pectoris. Only preliminary evidence shown that this self-report measure is as valid and reliable a exists for the likelihood of deleterious long. predictor of angina pectoris as a physical exam by a physician. term health effects on office workers, or spe- (Lawrence M. Friedman, et al., “Assessment of Angina Pec- toris After Myocardial Infarction: Comparison of ‘Rose Ques- cifically on VDT workers. Most studies show tionnaire’ With Physician Judgment in the Beta- Blocker Heart that support staff who work at a VDT report Attack Trial, ” American Journal of Epidemiology, vol. 121, more psychosomatic symptoms than either NO. 4, 1985, pp. 555-563. ) “’”The ratio reported is after adjustment for age, sex, base- other support staff or professionals who work line health status, health risk factors and baseline systolic blood at VDTS. These studies, in general, also show pressure. The risk did not change when ergonomic strain, job that women report more psychosomatic symp- strain and social support from the supervisor were taken into account. There was a 21-percent increase in the risk when the toms, as do people in jobs characterized by control over the pace of work was taken into consideration. —— .— Again, the unanswered question is whether the job was charac- ““’R. Kar~sek and B. Garden, Managing Job Stress, Work. terized by low control prior to automation or whether working ing Paper, Columbia University, Department of Industrial Engi. conditions were exacerbated by the automation of the work neering and Operations Research, 1984, process? The chronic illness measure was composed primarily ‘(’’ LaCroix, op. cit. of heart disease (70 percent) with cases of cancer, chronic mus- “’’These can also be explained by other factors such as sit culoskeletal disorders, and gastrointestinal diseases. These re- uations outside of work or biological predisposition. Research sults are preliminary and further analysis is currently being efforts should in the future attempt to differentiate between carried out. For a description of the study see Mary Haan, the risks associated with work and those associated with lei. “Health Effects of Automated Office Work, ’ paper presented sure. Also, physical and psychosocial working conditions can at the Office of Technology Assessment Symposium on The produce similar adverse stress responses and should be differen Impacts of Office Automation and Computer-Mediated Work tiated in future research. on the Quality of Worklife, December 10-12, 1984. Ch. 5—Office Automation and the Quality of Worklife ● 151 .—.. —

Since the evidence relating working condi- in job and organizational changes. The major tions in automated offices to stress-related dis- dilemma facing public health officials is that eases is still limited, it may be thought prema- by the time the population of VDT users has ture to begin job and organizational redesign worked long enough to manifest chronic out- strategies. The major dilemma facing man- comes there will be few people to use as con- agers is whether it is more cost effective to trols, since most office workers will be working wait and make job and organizational changes at the VDT. later, or to use the new technologies to usher

SECTION 111: INTERVENTIONS Office Design and Workstation Design Figure 5-2.—The Proportion of VDTS Installed in New Office Space Compared to Existing Space, 1984-90 More and more organizations consider the design of the office, building, and workstation as integral parts of the new technology. These 40M characteristics of office environments can contribute to quality of worklife both directly, and 30M indirectly by ameliorating stressful working conditions, 20M

Office Design 10M The introduction of new office technologies into a building can affect the way the building performs —the distribution of office space, 1984 1986 1990 heating, ventilation and air conditioning, pow- Year er and wiring, and acoustics. 105 Running of = New buildings cables through offices can be the cause of falls. Office design can balance the impersonality Most video display units will be installed in existing office of some computerized office tasks. However, space. Even if every person in new office construction in new buildings will only accommodate about the United States had a VDU, only about 5 percent of the VDUS would be in new buildings. Therefore, accommoda- 5 percent of the computer terminals installed ting them is mainly a retrofit job. (Assuming approximately between now and 1990 (see figure 5-2). The sin- 200 gross square feet for each workstation with a VDU, gle greatest area of impact will be the retrofit- then if the height of each bar represents the total space oc- cupied by workstations with VDUS, the shaded part of each ting of older buildings to accommodate new bar represents the cumulative total of VDUS in new office technologies. Retrofitting can be as simple as space.) putting in a new lighting system or as com- SOURCE Michael Bell, Harbinger Group Inc 1985 —— -— .— 1t has been estimated that only 2 percent of the costs of plex as complete rebuilding of the internal conducting business in an office building over 40 years are devoted to building design. Six percent goes to operation and structure of the building. When new office tech- maintenance and 9.2 percent to labor. Therefore, improvements nologies are haphazardly introduced without in the quality of worklife through building design offers a po- considering the extra demands placed on the tential cost-effecti~e ie~’er for organizations. This estimate is based on 1971 dollars, but the differences in scale still exist building, new health and performance prob- today, see Francis T. Ventre, Documentation and Assessment lems can develop or old ones can be amplified. of the GSA PBS Building Svystems Program: Final Report and Recommendations, NBSIR 83-2777, General Services Admin- istration, Washington, DC, 1983. This general ratio of costs Office Space has been reproduced in another 7 year study of office design and its impact on the quality of work (Michael Brill, presenta- Office automation allows the redesign of tion at Conexion ’85, Atlanta, GA, Nov. 6-9, 1985). workspace to accommodate private and shared 152 ● Automation of America Offices

work. Allocation of space is always a critical air, heat, and cooling, and make indoor air pol- factor in offices; it signifies status and or- lution and thermal discomfort worse. It is ganizational commitment to the worker. It pro- recommended that in refitting a building for vides some control over interruptions and extensive office automation, the building be privacy and encourages or discourages social remodeled as a set of microzones composed interaction, factors associated with job satis ” of comparable offices with localized control of faction and performance. the heating, cooling, and ventilation system. A personal computer and attachments take Workstation Design about 12.5 square feet of office space, which increases individual workspace needs. 106 With The workstation includes the table or desk the cost of office real estate rising, new tech- holding the terminal, the chair, and the equip- nology is sometimes being crammed into in- ment that an operator users. In many offices appropriate spaces that can lead to shifts in these have not changed, and the microcom- status, and awkward work postures associated puter merely replaces, or even sits next to, the with visual and musculoskeletal strain. Noise typewriter. Yet several characteristics of the 109 levels can be distracting, especially for work- VDT differ from conventional office tech- ers in an open plan office,107 and devices such nologies and impose different physical de- as acoustical printer covers may be needed to mands on the worker: reduce noise levels. Changes in office layout ● The terminal is self-luminous. may be necessary to reduce the isolating ef- ● There is a transient display on the screen, fects of computer work. whereas the display in printed text is Air quality is a major problem in modern constant. offices. Heating and cooling problems can be ● VDTs usually have highly specular curved exacerbated by office equipment that gener- glass surfaces that reflect light. ates heat, and by changes in lighting that are ● Information is presented in a vertical made to accommodate VDT users.108 Hot spots plane as compared to the horizontal plane caused by concentrations of office equipment of paper or the angled plane of the type- can change the way the building distributes writer. ——————— In conventional offices the illuminance has “hIn one study, “Office Research Into Buildings and Infor- been kept high for reading, with other light mation Technology (OR13 IT)” it was found that new information sources, such as windows, contributing to the technology only increased the secretaries’ space requirements by 50 percent (Duffy, Eley, Giffone, and Worthington–Ar- illumination. For VDT work, much lower illu- chitects, ORBIT Report, 1983). mination is best.110 But the worker often looks “’”It has generally been argued that open space offices are back and forth from the VDT to printed text most beneficial to workers doing repetitive and boring tasks; they provide needed social stimulation. Alternatively, people and other equipment, so a compromise is re- doing creative work require private space. However, this has quired; task lighting (lamps) can be used for recently been challenged by researchers who have found that additional illumination where needed. Tradi- even workers with boring and repetitive jobs prefer private spaces to open spaces and giving it to them increased their ——— job performance (E. Sundstrom, et al., “Privacy at Work: Ar- “’’The discussion of VDTS usually is about the monochro- chitectural Correlates of Job Satisfaction and Job Performance, matic raster scan CRT, which is like a television screen with Academy & Management Journal, vol. 23, 1980, pp. 101-1 17). some additional electronics. Other kinds of VDTS that may “wit is generally estimated that a workstation and operator be much more common in the future are the plasma panel, liq- can generate 18.0 Btu/square foot of heat throughout a build- uid crystal, and electroluminescent displays. See App. A for ing. For discussion of these problems see American Society descriptions of the technology. of Heating, Refrigerating, and Air-Conditioning Engineers, “(’The American National Standards Institute recommends ASHRAE Standard 62-73. Standards for Natural and Mechan- a general lighting level of 750-1600 IUX for traditional desktop ical Ventilation (New York, 1973); ASHRAE Standard 55-1981. reading; other groups recommend no more than 200 IUX for Thermal Environmental Con&”tions for Human Occupancy (New rooms where VDTS are used. American National Standard Prac- York, 1981); ASHRA Standard 90-75. Energy Conservation tice for Office Lighting, ANSl A132.1 (1973); AT&T Bell I.ab- in New Builch”ng Des@ (New York, 1977); and ANS1/ASHRAE oratories, Video Display Term”nals; Preliminary Guidelines for Standard 62-1981. Ventilation for Acceptable Indoor Air Qual- selection, Installation, and Use (1983); NIOSH, Potential Health it.v (New York, 1981); also Ventre, op. cit. Hazards of Video Display Term”nals (1981). Ch. 5—Office Automation and the Quality of Worklife 153 tional office and office furniture design assumes a depressed line of sight, but the vertical position of the VDT brings windows, ceiling lights, etc., into the line of sight, causing glare. The reflective surface of the screen can also contribute to eye strain. On a VDT the display is transient and there is a characteristic flicker (assuming that the VDT is a cathode ray tube) which is often im- perceptible to the worker, but can probably lead to visual fatigue and asthenopia although it has not been linked to visual performance. 111 The readability of the screen is also related to the structure of the dot matrix used to create characters, the contrast between the characters and the background, and the viewing distance of the person from the screen. In- creases in the size of the matrix have been 112 shown to increase reading performance, but Photo credl( O~(fca/ Coat/rig Labora(or/es /fJc this is not within the control of the user or, One way to control glare and enhance readability is to generally, the purchaser. The contrast between use a filter characters and screen can be controlled by the user, and should be placed for ease of use. The fonts used in VDTS are chosen by engineers ized that office workers frequently use both for convenience in design, and are less easy paper and a terminal in the same task. The to read than print fonts evolved through years visual and musculoskeletal strain that can re- of practical experience and user preference. 113 sult from the wrong viewing distance is best They assume a set viewing distance between managed by providing fully adjustable equip- viewer and screen, but some people lean back ment so that each user can adapt the work- in their chairs and put the keyboard on their station design to fit his/her own needs. A tilt- lap or in other unlikely places.’” This is espe- able screen and adjustable desktop can solve cially likely when the worker has such a small many problems. table or desk that cannot hold documents as The keyboard is likely to remain the domi- well as the keyboard and screen. Many office nant input technology for most office work- furniture designers have evidently not real- 115 ers; keyboard work has been associated with carpal tunnel syndrome and cervicobrachial — — “If the refresh rate is at least 65 flashes per second, there syndrome. The physical characteristics of the is no perceptible flicker; VDT refresh rates are about 30-70 Hz. —— Television set flicker has occasionally been associated with pho- ‘‘ ‘The usual QL$’ERTY keyboard dates back to the 1870s, tosensitive epileptogenic seizures, but the refresh rates known and was recognized as an international standard in 1966 al- to induce such seizures are low, from 8-14 Hz. It is thus highly though it has been challenged by the Dvorak ke~board, with unlikely that such seizures would be induced by VDT work. a different arrangement of the keys. Some studies indicate the ‘“A 14-percent increase in reaction time and a 10-percent Dvorak would improve typing speed by 25 percent and shorten decrease in errors was shown in a study by Haubner, et al., the time needed to learn to type. It was designed (after W’orld Visual Dispiay Units–Characteristics of Performance, Com- War II) to avoid excessive wrist movement b~’ locating the mission on International Lighting, 20th sess., 1983, as reported most commonly struck keys in the center row, possibl~’ reduc- in Bergqvist, op. cit. ing musculoskeletal strain, There is currentl~. a resurgence of ‘‘ ‘National Academy of Sciences, op. cit. interest in the Dvorak, but both employers and employees are “For further discussion see l+;. Grandjean, W’. Hunting, seemingly unwilling to undertake the retraining that would be and M. Pidermann, 4’VDT Workstation Design: Preferred Set- necessary to make the change. See ,Jan Noyes, ‘ ‘The QWERTY tings and Their Effects, Human Factors, ~ol. 25, No. 2, 1983, Keyboard: A Review, International Journal of Alan-illachine pp. 161-175, Studies, vol. 18, 1983, pp. 265-281. 154 ● Autornation of America’s Offices — .——— — — keyboard associated with precursors of these syndromes, such as its height, can be altered. Some keyboards are attached to the terminal and resemble the typing keyboard in height from the table (generally over 40 mm); others are detached and built lower, which has many advantages since a determinant of musculoskeletal symptoms in forearms and wrists is the ability to intermittently rest the arms or wrists on the table.116 A detachable keyboard can also be arranged for comfort and viewing distance. Chairs are critical to the comfort of any office worker; and with office automation people tend to spend longer blocks of time in one When tables andior chairs are not adjustable, the user sometimes must assume awkward postures. This place. The chair should allow one to change woman may eventually develop neck cramps from the seated posture without adopting an awk- continually looking down ward position; 117 and it should be easily adjustable. To prevent lower back problems, office chairs should have an adjustable lumbar back support and the back rest height should extend beyond the lumbar region to the thoracic region and be adjustable for height, angle, and pressure. The seat should also be adjustable to allow people of different sizes to get about a 90-degree angle between upper body and thighs. Table height is also important. If used al- ternately by several workers it should be easily adjustable to accommodate different heights. Desks should not restrain knee and thigh movement, and should have enough space for working documents, screens, and keyboards Photo credlf M/cbae/ Sm/th to be moved around. Sometimes the worker finds her own way to sit comfortably One of the most important elements of office design strategy is to make sure that office workers understand why adjusting lighting, furniture, and temperature controls is important, and how to do it.118 A Finnish study found that if data-entry workers were trained to recognize ergonomic problems and preven- “’’Operators may not prefer suggested optimal keyboard tion strategies, the level of clinically recognized heights and their preference may not affect performance. Teresa Burke, “Effects of Keyboard Height on Typist Performance and Preference, ” Proceedings of the Human Factors Society, 28th Annual Meeting, 1984, pp. 272-276. See also Grandjean, “’This has in fact been mandated in the OSHA Act (Sec. op. cit. 21c), which says that the Department of Health and Human “ Most keyboard operators maintain an erect posture for Services must provide for “the establishment and supervision only 2 to 3 minutes at a time. Standards and recommendations of programs for the education and training of employees and are usually based on this position, even though studies shc~w employers in the recognition, avoidance, and prevention of un- that people prefer leaning slightly forward or slightly backward. safe or unhealthful working conditions, Ch. 5—Office Automation and the Quality of Worklife ● 155 — — —— — —— -- .- neck, shoulder, and elbow problems was sig- In developing standards or guidelines, current nificantly reduced over a 6 month period.119 tax codes should be examined to ascertain that they will not act as a barrier to intended Public Policy and Quality of Worklife change.

Public policy interventions must be consid- Workers’ Compensation ered in light of both the scientific evidence and Under common law, employers have a duty the political and economic climate. Many orga- to exercise reasonable care in protecting their nizations look to new technologies to provide employees from harm in dangerous situations. them with the competitive edge, and some ar- Remedies under the common law of torts have gue that health and safety regulations inhibit been proposed for many health and safety the full use of new technologies and further problems.’” But in the United States, the laws innovations. A report issued by the President’s creating workers’ compensation generally make Commission on Industrial Competitiveness this system the exclusive remedy for employee recommended that no new health and safety 123 disability, although in many instances this regulations be established; society should not exclusionary principle has been circumvented seek to eliminate risk, and risk below mini- by third-party liability suits in which the em- mum levels should be left unregulated, or to ployee sues the manufacturer of equipment or industry self-regulation.120 Executive Order material (e.g., the thousands of suits against 12291 (1981) provided that except where ex- Johns Manville as the producer of asbestos pressly required by law, the costs of a regula- materials). tion should not exceed its benefits. This must be considered in discussion of the potential Workers’ compensation does not cover spon- effects of office automation. Cooperative ac- taneous abortion, miscarriage or birth defects, tions by employers and employees, when they since this class of injury does not impair the are sought in good faith and are successful, are in theory a more cost-effective strategy -These typically fall into three categories–negligence, than regulation because they can be self-en- product liability, and strict liability. In negligence actions, the forcing. employee must demonstrate that the employer was negligent ir. the maintenance or inspection of equipment or did not ade- Investment tax credits have encouraged the quately warn the employee about risks inherent in its use. These actions must be shown to cause proximate harm to the em- adoption of capital-intensive technology to im- ployee and not to be a part of normal dangers inherent in the prove the efficiency and productivity of the job. Since it is very difficult to demonstrate a causal link be- work process, yet often working conditions tween VDT use and any adverse health outcome, this area of legal action has limited utility. The same analysis can be ap- that emerge from this technology adoption pro- plied to product liability and strict liability?’. William Presser, duce adverse stress responses.’” Tax policies Handbook of the Law of Torts, 4th ed. (St. Paul: Wrest Publish- can also directly affect the way physical char- ing, 1971). “Workers compensation is a broad disability>. insurance acteristics of the office are designed. For ex- program in which awards based on loss of earning power are ample, some experts suggest that technicali- paid to workers whenever they are injured on the job, Under ties in the way depreciation is allowed have workers’ compensation the employee must establish that the condition arose from employment. (T?’picall~’ the terms proxi- encouraged open plan offices so that partitions mate cause, producing cause and contributing cause are used separating office spaces can be depreciated. to refer to the relationship between the working conditions and the injury or disease. ) lf’here a claim is upheld, a schedule of ‘ ‘R. Kukkonen, et al., “Prevention of Fatigue Amongst payments is set up for the worker based on some formula that Data k;ntry operators,’” unpublished manuscript. Using a quasi- determines the extent that the worker is disabled or suffers experimental design, the researchers were able to demonstrate a decrease in wage-earning capacity. The clear intent of the significant decreases in neck and shoulder symptoms, back statute is to compensate all work-related injuries. (This section symptoms, and clinically defined neck’ shoulder tenderness and draws on the work of the National Council on Compensation hardening. Insurance report, Emotional Stress in the11‘orkplace–,NTeu. I.e- - ‘Report of the President’s Commission on Industrial Com- gal Rights in the Eighties, New York, 1984. ) When an injury petitiveness, as cited in The Occupational Health and Safet~’ is found to be covered by a workers’ compensation act, it is ,Vews]etter, ~ol. 15, No. 5, p. 3, 1985. usually held that the statutory compensation is the exclusive ‘- hlichael Beer and James W’. Driscoll, “Strategies for remedy and any recovery at common law (tort law) is barred. Change, ” Improt’ing Life at I! ”ork, op. cit. 1977, pp. 364-453. (Presser, op. cit.) 156 ● Automation of America’s Offices

worker’s earning power.124 It has allowed for workers who spend over 7 hours a day at a compensation for stress-related diseases and terminal may make such an argument effec- disabilities along with visual and musculo- tively. In addition, many chronic debilitating skeletal system injuries. Table 5-11 contains visual and musculoskeletal injuries do not oc- three examples of workers’ compensation claims cur suddenly and unexpectedly, so that claims for injury in automated workplaces. The work- are likely to be awarded only in States that er must show a causal link between work in accept gradual developments of an injury over an automated office and the injury. Currently, time. . for the VDT operator there is very little di- The workers’ compensation system was meant rect causal evidence for visual and musculo- to also serve as a preventive measure; forcing skeletal injuries and for stress-related injuries. employers to pay for injuries and diseases aris- Where an organic cause can be found to ex- ing from employment should encourage them plain the injury the claim is easier to inter- to develop preventive strategies. Emerging of- pret. Thus, demonstrating that some charac- fice problems may develop into compensata- teristic of the automated office environment ble disabilities, but the current work force led to a biological change in the worker is the would not benefit from the incentives for pre- clearest vehicle for establishing a compensa- vention created by the rise in compensation tion case. These conditions while impairing the claims. Yet today’s employee cannot sue the worker’s ability to work, may not be medically employer in most States through the common detectable, so the primary instrument for iden- law of torts since visual, musculoskeletal, and tifying illness and injury to the office worker stress-related conditions are compensable. is through the reporting of symptoms. Thus, it is difficult to demonstrate proximate cau - Mental Disability.–There has recently been sality. an increase in workers’ compensation claims related to mental stress. The California Work- If the condition predated employment or was er’s Compensation Institute found that stress aggravated by conditions outside the job the claims doubled from 1980 to 1982, while claims claim may be disallowed or the compensation for other disabling work injuries decreased dur- reduced. For the VDT operator who goes home 125 ing the same period. Workers’ compensation and watches television (also a cathode ray tube~ for mental disability arising from employment or has personal problems that produce adverse is greatest among younger workers, as shown stress responses, it is difficult to argue that in figure 5-3. Mental stress is significant by the work was the source of the injury, although itself, and may also predict future development of stress-related diseases. If it does, any in- “’John Parry, Jeanne Dooley, David Rapoport, and Johr Taylor, “Are VDTS Hazardous to Your I.egal Health?” Men crease in claims because of office automation tal and Physical Disability Law Reporter, vol. 8, No. 4, 1984 could be costly to society. Table 5-12 provides pp. 342-360. For a more complete discussion of the workers several examples of successful workers’ com- compensation system and its evolution see Reproductive Haz ards in the lt’orkplace, op cit.; or Peter Barth and H. Allan Hunt, V’orkers’ Compensation and Work-Related Illnesses ana “’California Worker’s Compensation Institute, Bulletin, Diseases (Cambridge: MIT Press, 1980). Apr. 20, 1983.

Table 5-11. —Workers’ Compensation Claims for Employees Working at Video Display Terminals

n- Job —. Probler Injury Word processing Stress of 6 to 8 hours ‘VDT work per day - ‘“ - Nervous brea~down a Insurance claims processor Repetitive work al VDT lead to wrist pain Carpal tunnel syndromeb Word processing Severe headaches Accommodative spasma Sensitivity to light Visual pain aset!led prlo~ to wkwwflt -. bClalm awarded SOURCE Legal Rlgbfs for VDT Users (Cleveland OH Working Womels’ Educational Fund, 1985) Ch. 5—Office Automation and the Quality of Worklife ● 157

Figure 5-3.—A Comparison of Workers’ Compensation Claims for Mental Stress and Other Occupational Diseases 30

0 — 1-29 30-39 40-49 50-59 60-99 Age Mental stress Other occupational diseases I I I I SOURCE National Council on Cornpensatlon Insurance Ernot~onal Sfre.ss (n the LVorkp/ace– New Lega/ Rights ~n (he .E~ghltes (New York 1985)

Table 5-12.— Examples of Mental Stress— Mental Disability Claims for White-Collar Workers

Alleged Alleged - ‘“ - Occupation of clalmant work-related mental stress mental disability Advertising manager Overworked, supervisor requested–ea-rly retirement Anxiety, depression Clalms director Job pressures Psychiatric illness Data analyst/control clerk Inability to perform job duties Psychological disability Insurance underwriter Increase in job duties Mental breakdown Secretary Increase in job duties Depressive neurosis SOURCE Ernot/ona/ SIress ~n the WorkFace– New Lega/ R/ghts /n fhe E/ght/es (New York Nat!onal Council on Compensahon lns~rance 1984) pensation claims for mental disability, show- workplace than are older workers. It also cor- ing the variability in both the alleged cause responds to the trend of increasing automa- and the disability. The workers’ compensation tion of the workplace that affects younger system can be considered as an early warning workers. Since a majority of the claims have system for the effects of office automation on been filed by women (54.2 percent), it may be the mental health of the worker. logical to infer a relationship with the recent technological changes; the workers first af- Claims for mental stress and mental disabil- fected by office automation in the 1960s and ity decrease with increasing age and are greater 1970s were predominantly women.127 among women than men. 126 This could be the result of a cohort effect; younger workers are probably more likely to demand rights in the ‘-It has been suggested that the highly publicized mental disability claims associated with stress may lead to a greater reporting and filing of similar claims. It may be that the legal ‘These results are based on a random sampling of claims recognition of mental disabilit~’ claims has led to an increase from 1980 to 1982 in 13 States representing geographic varia- in the number of claims. This is important in mental stress bility. The study is described in National Council on Compen- claims because of the universality of stress across all occu- sation Insurance, op. cit. pations. 158 ● Automation Of America's Offices

Indemnity costs for gradual mental stress er’s heart attack. The only condition under claims were less than 60 percent as high as which this could be associated with office auto- the costs for other occupational diseases per mation is if the technological change itself were average claim in 1980, but surpassed these construed as a traumatic event. Perhaps an claims in 1982. Also, the average medical costs acute fear of being exposed to a terminal that incurred for gradual mental stress claims purportedly emits hazardous radiation could passed other occupational diseases in 1981.128 lead a person to an episode of mental disabil- Mental disability awards could become an eco- ity. 129 nomic burden for industry. Fifteen States have no relevant statutory If workers attribute their adverse stress re- limitations. Seven State courts have concluded sponses to the VDT and workers compensation that mental disability is to be treated no differ- claims become a common avenue for compen- ently than physical disability if working con- sation, then the system may become overbur- ditions are the cause of the disability; nine have dened, with the employer becoming a univer- ruled mental disability is not compensatable. sal insurer. The workers’ compensation system Most of the States that have taken the posi- is at a crossroads in determining whether a tion that mental disability claims are not com- worker who is unable to work because of men- pensable have strictly interpreted the statutes tal disability is to be treated differently from defining injury to be of a physical nature. Eight a worker unable to work due to a physical in- States have adopted the idea of an acute event jury arising out of employment. in employment as proximate cause. They allow mental disability claims when there has There have been relatively few compensa- been some traumatic event that can be identi- tion claims specifically related to work at a fied as the proximate cause of the disability. VDT (about 30), most for physical injury bul: Eleven States have upheld the right of the some for mental injury. In one case a VDT worker to claim a mental disability if the stress operator claimed that the VDT contributed exceeds the stress of everyday work. In these to an already high-pressure atmosphere, lead- States, there have been cautions about limiting to three stress reactions during a 7-month ing the scope of the compensation system to period. Her claim was upheld by the New Jer- avoid the development of a social health in- sey workers’ compensation board. surance program. There seem to be three compensable cate- The Federal Government acted first (1908, gories of mental stress. The stress response 1916) to establish workers’ compensation for as a usual condition of the work environment Federal railroad and then for other employ- is perhaps the most liberal and far-reaching 130 ees. Since then, the workers’ compensation of the categories. The recognition that grad- system has evolved at the State level relatively ual accumulation of mental stress is a cause without Federal interventions, although there of the mental disability is important since have been proposals from time to time to create many stress responses in offices result from a Federal system. One role the Federal Gov- the incremental or chronic conditions of work ernment might play is to serve as an informa- rather than from any single acute event. Sec- tion clearinghouse for issues of office automa- ond, the stress responses can result from a continuing set of unusual conditions in the work environment, for example, an increase in job ‘Z9This is analogous to the idea of a pollutant on the job, where the effects of the pollutant are unknown. The Montana duties because of new office technologies, Supreme Court has allowed such a compensation to be awarded Third, the stress reaction can be due to a suds to a worker who developed psychological problems on exposure den and unusual event in the work environ- to pollutants at work (Alcklahon v. The Anaconda Company, No. 81-34 (Montana Supreme Court, Mar. 29, 1984), 8 MPDLR ment, for example, the witnessing of a cowork- 291). — ‘“’M.B. Kent, A History of Occupational Safety and Health ‘J’ Nat~onal Council on Compensation Insurance, op. cit., p in the United States, 1983, as cited in Preventing Illness and 6. Injury in the Workplace, op. cit. Ch. 5—Office Automation and the Quality of Worklife 159 — tion and stress responses, to provide States cided by the U.S. Circuit Court of Appeals in with the most recent scientific evidence for Richmond, Virginia, which exemplify the im- making decisions. Clearly, automation is the pact judicial decisions may have on occupa- dominant change in office work and many men- tional health and safety policy. In the noise tal disability claims in the next two decades case the judges invalidated a standard on the are likely to revolve around the effects of the grounds that it might on the basis of medical new office technologies. examiniations require employees to take actions concerning hearing loss caused by non- Standards or Guidelines occupational factors.135 While progressive hear- Since ergonomic factors in office equipment ing loss can be identified through medical are important to the health of the American exams, the exams can not distinguish between worker and the productivity of American busi- loss resulting from occupational and nonoc- ness, there have been proposals that ergonomic cupational sources of noise. The ruling has been standards or guidelines be developed, either reversed by the same court. If upheld, it would by government or other institutions. ’3’ A re- have probably severely restricted the devel- cent discussion of regulatory policy pointed opment of Federal standards for automated out that health and safety regulations should offices where most exposures are chronic and focus on threshold limit values on exposure confounded by nonoccupational factors. as oppposed to means for reducing exposure The Supreme Court in 1980 upheld an earlier 132 such as design standards. Standards can lower court decision striking down the 1978 only be developed with the appropriate meas- OSHA benzene standard. They found (5 to 4) 133 urement techniques. Working conditions that OSHA had not established a threshold that produce adverse stress responses can be limit for benzene posing a significant risk to measured in many different ways and scien- the worker. The Secretary of Labor must dem- tists disagree on which ways are best. There- onstrate that a workplace threatens the worker fore, the development of standards for work- with a significant risk of harm.136Although ing conditions that produce psychological and providing limited guidance as to what signifi- biological stress responses in individuals may cant risk means or how it should be calculated, be an option to consider only when there are the Supreme Court decision has demanded a valid and objective measures of the working more rigorous scientific treatment of occupa- conditions. 134 tional safety and health standards. 37 The set- Any standards development process would ting of standards designed to improve the have to consider issues raised in the recent health and well-being of the office workers benzene standard case decided by the U.S. Su- would have to take into account this decision. preme Court and the noise standard case de- However, standards can be developed and — .——- — adopted voluntarily .There are three general ‘ “In 1981, the Science and Technology Committee of the types of standards; engineering, informational, House of Representatives held hearings, “The Human Factor and administrative. Engineering standards in Productivity. These hearings are the most recent attempt to gather information about the role of human factors in indus- (which include design standards) establish al- trial competitiveness (see, The Human Factor in Innovation ternative means of interfacing with the tech- and Productivity, U.S. House of Representatives, Committee nology or alternative means of building the on Science and Technology, Subcommittee on Science, Tech- nology, and Research, 97th Cong., 1st sess., 1981). technology to ensure the health and safety of “ LDouglas Ii. Ginsburg, “Administrative Efforts to En- hance the Opportunities for Self- Regulation,” I,abor Law Jour- —.— nal, vol. 3,5, No. 12, 1984, pp. 731-735. ‘ “Reported in the Occupational Safet,\’ and Health I.etter, 1‘Becker, op. cit. vol. 15, No. 1, 1985, p. 2. ‘ “Edward E. I.awler, “Should the Quality of Work Life be ) “Industrial Union Department, AFL-C1O v. American Pe- I.egislated?” 7he Personnel Administrator, vol. 21, No. 4, 1976, troleum Institute, 448 U.S. 607 (Supreme Court, July 2, 1980). pp. 17-21. See also, Edwin A. I.ocke, “The Case Against I.egis- For a full discussion of the implications of this decision lating the Quality of Y$’ork I.ife, ” The Personnel ,4drninistra- for OSHA standards setting see, Pre~’enting Illness and In- tor, vol. 21, No. 4, 1976, pp. 19-21. jur.~’ in the Workplace. op. cit. 160 Automation of America’s Offices

the worker. Informational standards include the development and enforcement of stand- product labeling, instructions for proper use, ards.140A major impetus for currently proposed and other means of transferring information State bills is a concern over the inadequacy from the employer or manufacturer to the of voluntary standards for these reasons. One worker. Administrative standards establish or- option at the national level would be to estab- ganizational policies such as rest breaks. A lish a national commission to oversee stand- key policy issue is how to ensure that the ards development or to empower the National standards development process is based on Bureau of Standards with such duties.141 sound scientific evidence. 138 A third problem is that of the appropriate Design Standards.—The possibility of office level of specificity for design standards. The and workstation-design standards has received level of specificity in State bills varies widely, much attention, spurred on by bills introduced indicative of the uncertainty as to the most into at least 18 State legislatures, and by the effective way to modify the work environment development of standards in other countries. to accommodate new office technologies.142 The Governor of New Mexico has issued an International standards reflect differing ap- executive order (No. 85-1 1) mandating ergo- proaches, different populations, and different nomic guidelines for State employees. Such goals. The very specific German standards are proposals and actions are based on the assump- meant to standardize the building and production that there are definable and measurable tion of office equipment, while Swedish stand- characteristics of both the office and the work- ards are more like guidelines to be used in station that, if modified, will improve health negotiation between the unions and manage- and worker performance. A major issue is ment. Japanese guidelines are not binding and whether standards should be voluntary or are very general. required-self-regulation or governmental reg- Other major issues in standards develop- ulation. It is argued that self-regulation is more ment are how to define enforcement mecha- flexible, and standards can be tailored to meet nisms for government standards and how to the specific office automation application. How- ensure that the development of standards ever, a second question is whether many orga- spurs rather than impedes the development nizations would voluntarily pay the front-end, of more protective technology in the future. or retrofitting cost that might be entailed. 139’ Standards can be established at either the Fed- Another issue is that of fairness; standards eral, State, or organizational level by the use development committees composed of special of procurement schedules.143 California, New interest groups are often suspect. Especially Mexico, Massachusetts, and Wisconsin have in promulgating mandated standards, bal- all developed procurement guidelines for the anced groups of consumers, producers and purchase of workstation equipment in the pub- other affected parties may be preferable for lic sector.

““An examination of the currently proposed office stand- “’’Ginsburg, op. cit. ards for State bills demonstrates problems in the standards “Currently, the National Bureau of Standards coordinates development process; general lighting levels vary from 500 IUX within the Federal Government and assists the private sector or less to greater than 700 IUX. International standards also in the procedures and policy for the development and applica- do not agree. There is no general national or international con- tion of standards; however, they have no enforcement powers. sensus on the best way to establish standards for office auto- “’Currently, the Human Factors Society in conjunction mation. The lack of consensus may reflect the generally agreed with the American National Standards Institute is developing need to maximize flexibility in current design to accommodate a set of standards for the physical and perceptual ergonomics a variety of future needs. This need for flexibility is clearly of visual display terminal workstations. These standards con- reflected in the mechanisms for controlling glare in proposed tend that ergonomics is highly applications dependent and looks State bills, which range from installing indirect lighting; to only at word processing, data-entry, and data-inquiry tasks. antiglare.filters; to proper placement of the terminals with re- “’0. Ostberg, et al., “Ergonomic Procurement Guidelines spect to windows; to task lighting; to screen hoods. for Visual Display Units as a Tool for Progressive Change, ” “ qFrancis Ventre, “Transforming Environmental Research The Procd”ngs of the Eleventh International Symposium on Into Regulatory Policy, ” Responding to Social Change, Basil Human Factors in ‘1’elecornmum”cations, Sept. 9-13, 1985, Honikman (cd.) (New York: Halstead Press, 1984). Cesson-Sevigne, France. Ch. 5—Office Automation and the Quality of Worklife . 161 -.

Information Standards.— These might pro- Eye examinations, rest breaks, semiannual vide the employee and employer with infor- equipment inspections, and transfers for preg- mation about, for example, the recommended nant VDT operators could be handled through lighting levels for using a particular display administrative standards. Several countries terminal. Rhode Island has just passed a law have standards or guidelines regarding visual requiring the State Department of Labor to exams. 145 Legislation calling for rest breaks develop a brochure on VDT use and to hold has been proposed in several States, and sev- training sessions throughout the State. eral nations have guidelines or standards with respect to rest breaks.146 Although Sweden’s Health and Safety Standards.–They are ad- practice of 15 minute rest breaks after every ministrative standards. At the Federal level, hour or 2 hours (depending on the work) is often an initial policy consideration would be to de- cited, this is not a national standard but re- cide whether they should be developed within sults from agreements between labor organi- a single agency or by several agencies. The zations and management. This will change former would eliminate replication, while the with the issuance of the Ordinance Concern- latter would ensure that all areas are covered. 147 ing Work With Computer Displays. This or- Currently, OSHA, the Consumer Products dinance requires that employees who work Safety Commission (CPSC), and the Depart- more one-half hour consecutively on the VDT ment of Health and Human Services (DHHS) on a daily basis, must receive eye exams. In can develop standards that might be adapted Britain, the Health and Safety Executive rec- to address new office technologies. For exam- ognizes that “the most satisfactory length of ple, the OSHA Health Hazard Communica- pause can only be determined by consideration standard is intended to disseminate in- 148 tion of the individual operator’s job ... , formation about chemical health hazards and and recommends that natural breaks be built only applies to the manufacturing sector. For into jobs, with a mix of VDT and non-VDT OSHA to disseminate information about health work; goals are provided to be used in labor- and safety issues in office automation under management bargaining. the Health Hazard Communication Standard, that authority might have to be broadened. 144 Guidelines.–The examples above point to Alternatively, the recently proposed High Risk the problems of standards development, which Occupational Disease Notification and Preven- is both a scientific and apolitical process. Com- tion Act of 1985 (H.R. 1309), would establish munications between the scientific and politi- within NIOSH the authority to disseminate cal communities are sometimes lagging and information to persons at an elevated risk for mechanisms for encouraging more dialog are the development of disease. Only workers at needed. an elevated risk will receive counseling and medical monitoring. The disadvantage to this ‘ Japanese pro~’isional guidelines for T’II’I’ work calI for a approach is that it requires prior knowledge visual exam as part of the preemplol-ment medical exam, with regular eye tests thereafter. J1’est German regulations sa}’ that about the development of the disease and the VDT workers should have eye exams m’er~. 5 years until age risk to the worker. A broader approach is to 45 and every 3 years thereafter. In France, two regulations provide information to all employers and em- stipulate eye exams and special medical surxwillance for J’D’I’ users. But Great Britain does not recognize the need for ~isual ployees so that the factors associated with standards for VDT usage ‘‘which are an~. different from other health and safety can be discussed before the clerical work. ” equipment is installed. This would require in- “TWO Swedish standards call for periodic intermissions without specifying length or frequency?’: ,J apan pro~’isiona] put from many sectors of the Federal Gov- guidelines call for at least a 10-15 minute hreak after each hour ernment. of VDT work. ‘‘ Ordinance Concerning 11’ork M?th Computt’r Displa.~’s, translated b~’ Dr. Olo\’ Ostberg. This ordinance has not gone -—— into effect yet. ‘ ‘“A recent court decision suggested that OSHA expand the “Great Britain, Iiealth and Safety Executive, I’isual Dis- scope of the standard to include nonmanufacturing industries, pla~’ [)nit.s (I,ondon: Her Majest?,’s Stationar?T Office, 1983), ~l,s, Court of ,,~ppe~s, ~jrd Circuit, Case No. 83-3554. p. 1 :?. 162 ● Automation of America Offices

An alternative to mandated standards is the the feasibility y of using new office technologies development of guidelines articulating goals. as both a public health and a productivity tool. Both Sweden and Japan have established goals The OSHA Act (section 20) mandates con- for workstation design. In Japan, these are wholly voluntary; in Sweden the guidelines are tinued research and demonstration projects presented as the government’s position and exploring emerging problems including psy- are used in collective bargaining. Guidelines chological factors (such as stress) created by new technologies. Office automation is one recognize the variability yin the way office tech- technological change with such a broad ex- nologies can be implemented. They can be established within the broader context of an posure that Congress may wish to insist that the Department of Health and Human Serv- institutionalized change process. In some coun- ices put high priority on investigating the tries this is environmental legislation; 149 for health and safety issues, demonstrating prac- example, the Work Environment Act of Nor- tices to reduce any potential effects, and dis- way (1977) says, “An effort shall be made to seminating such information. avoid monotonous repetitive jobs and jobs which are determined by a machine . . . to such There is a need for at least three directions an extent that the worker is prevented from in the research. The first is to follow office altering his rate of working. ” Such acts give workers over time to develop risk estimates those involved in the change process a national of the relative contribution of office automa- policy against which to evaluate their efforts. tion to the natural history of a disease, focus- Such goals and guidelines are only as effec- ing on those populations at greatest risk today tive as the commitment on the part of em- (clerical and technical workers), and also con- ployers and employees to cooperatively achieve sidering the changes in the work of managers them, and on the part of government to moni- and professionals. This field research should tor and actively encourage their progress. be complemented by lab research to test relationships between working conditions and bio- Research Needs logical processes. Congressional hearings have addressed the The second is to define the appropriate meas- issue of possible hazards of VDT work,150 and ures of the physical conditions of work. Field much has been written on the subject, but evidence that compares objective measures of workers still wonder if new technology is dan- the physical environment to subjective meas- gerous. A possible public policy response is ures of the quality of worklife is limited. The to encourage research on various illness and tools for measurement must be sharpened and disease outcomes associated with the computer refined to assess the many subtle causes and mediation of work, both to answer the questions outcomes characteristic of office work. If it in the minds of the public and to demonstrate could be demonstrated that subjective meas- ..— ... —-— ures are valid indicators of the physical envi- “ L’Federal Republic of Germany: The Works Constitution ronment and discriminate the various health, Act of 1972; The Netherlands: Working Environment Act of performance and job attitudes, less costly 1980; Norway: Work Environment Act of 1977 (also known evaluations of the work environment would as the Act Respecting Workers’ Protection and the Working Environment); Sweden: Working Environment Act of 1974; Den- be possible. mark: Act Respecting the Working Environment; German Dem- ocratic Republic: Labour Code as Amended June 1977, Thes{~ Third, intervention and field evaluation stud- acts deal with all working conditions, including office auto- ies are needed to verify claims that changes mation. in ergonomic or other working conditions can “’’U.S. Congress, Committee on Science and Technology, Subcommittee on Investigations and Oversight, Potential improve worker productivity and reduce health Health Effects of VDT Term”nals and Ra&”ofrequency Heaters problems. These efforts should focus on high and Sealers, 97th Cong., 2d. sess., May 12-13, 1981. U.S. Con- risk groups of office workers or identify high gress, Committee on Education and Labor, Subcommittee on Health and Safety, OSHA Oversight: Video Display Term”- risk working conditions and develop modifi- nals in the Workplace, 98th Cong., 2d sess., 1984. cation strategies. Ch. 5—Office Automation and the Quality of Worklife ● 163 — . .

The Health Promotion and Disease Preven- warning system could be developed by link- tion Amendments of 1984, which establish re- ing these data sources. 152 This would allow research centers for disease prevention and searchers and policy makers to estimate the health promotion across the country, admin- relative severity of problems among different istered by the Centers for Disease Control. classes of workers. These centers could conduct the research proj- Legislation recently introduced into the ects mentioned above. House of Representatives would establish an Finally, it is important to know the true ex- early warning system to identify workers at tent of the problem. How prevalent are poor an increased risk for occupational disease (H.R. working conditions? Section 20(a)(7) of the 1309). This bill could be amended to include OSHA Act stipulates that the Department of language establishing a national morbidity sur- Health and Human Services conduct industry- veillance system for the development of chronic wide studies of the effects of chronic low-level diseases related to technological changes. exposures on the health of workers. This need for reliable data also points to a need for a Labor-Management Relations and centralized data collection system for moni- Office Automation toring the emerging problems. There is now no single source of this data. The current in- As has been pointed out, one strategy for dustry and occupational surveillance systems improving quality of worklife is through stand- are disparate and difficult to link together. In ards development, and a second is the setting testimony before Congress the Assistant Sur- of goals or objectives, incorporated in public geon General noted: or private sector guidelines. Another way to work toward goal-directed change is through The activities do not provide a comprehensive epidemiologic surveillance of occupa- collective bargaining. In Europe, there is much tional diseases and injuries in the United emphasis on involving worker representatives States . . . Unless our efforts are targeted in office automation planning. In some coun- toward comprehensive data collection and tries there is a national or local work council synthesis, the confusion will only grow worse. 151 to which industry supplies information about office automation plans. This creates the frame- The current data collection system at the work for monitoring how well organizations Bureau of Labor Statistics (BLS) is not able are moving toward established goals, minimizi- to identify the extent of office automation in ng the need for government enforcement.153 white-collar occupations. There is a need to This process of involving workers in technol- develop not only reliable indicators of national ogy planning is part of a process called co- trends in morbidity, but also broad national determination, a phrase that has gained some descriptions of those working conditions likely popularity in this country. to place the worker at highest risk. The Job Training Partnership Act of 1982, Section While the legal right to be kept informed 462(b) states: “the Secretary shall maintain about technological change has not been ex- descriptions of job duties, training and edu- ——— cation requirements, working conditions, and ‘ “For the importance of linking databases to inform policy- characteristics of occupations. There is a need makers, and current impediments see, Legal and A dministra - to further refine the definitions used in the tive Impediments to the Conduct of Epidemiologic Research, Task Force on En~ironmental Cancer and Heart and I,ung Dis- Dictionary of Occupational Titles to reflect the ease, 1984. current changes in the workplace. An early 1 ~ Federal Republic of Germany: Works Constitution Act of 1972; The Netherlands: Works Council Act of 1979; Norwal’: r] Assistant Surgeon General J. Donald Mdlar, cited in Oc- Work Environment ,4ct of 1977; United Kingdom: Emplo~- cupational Iflness Data Collection: Fragmented, Unreliable, and ment Protection Act of 1975; France: Act No. 82-915 of Oct. Sevent-y Years Behind Communicable Disease Surveillance, U.S. 28, 1982 and Act No. 82-689 of Aug. 4, 1982; Sweden: Act Rep- Congress, Committee on Government Operations, House Re- resenting Co-Determination of W’ork, 1976. For further detail port 98-1144 (Washington, DC: U.S. Government Printing Of- see Automation, Il”ork Organization, and Occupational Stress fice, 1984). (Geneva: International I.abour organization, ]984). 164 ● Automation of America Offices tended to American workers, the National La- bor Relations Board (NLRB) decisions about bor-Management Relations Act guarantees the the scope of the law and whether a series of right to bargain collectively with management. acts and amendments designed to deal primar- Thus rather than intervening directly in of- ily with blue-collar occupations applies equally fice automation related quality of worklifc well to white-collar occupations. A complicat- problems, the Federal government can choose ing factor is that in white-collar work, distinc- to leave this to industry self-regulation, judi- tions between management and labor tend to cial decisions, and labor-management relations, be blurred. In recent cases over whether a with National Labor Relations Board inter- group of workers has the right to organize, ventions when they are called for. the courts have been confronted with problems of determining whether professionals are Collective bargaining could function as a fo- workers or part of management, and who rum for resolving quality of worklife issues 156 makes decisions for the employ er. As office related to office automation. 154 The National automation leads to task bundling, the dis- Labor Relations Act (NLRA) established col- tinctions between management and workers lective bargaining to reduce the need for gov- will blur further. A recent Supreme Court ernment regulation by providing bargaining decision reemphasized earlier questioning of power to all parties.’” But the ability to use the intent of Congress in several sections of collective bargaining as an avenue for discus- 157 NLRA: was the intent to prohibit certain sion of stress, health, and ergonomic problems types of collective bargaining over technologi- surrounding office automation is limited by cal change? Current laws may require clarifi- the low level of participation of office workers cation in this regard. in collective bargaining units. While some labor contracts contain clauses Fair representation in this process also de- concerning automation, negotiation about the pends on judicial decisions and National La-n —— . decision to automate is not construed as man- “’’There are other mechanisms through which workers can datory by either NLRB or the courts. How- participate in organizational decisionrnaking about technologiczd ever, it is also not clear that management has change, but they are specific to an organization or industry. an absolute right to automate. The employer There has been, for example, great interest in the Japanese system of quality control circles. One observer notes: “Prede- does have the right to determine equipment cision joint consultation to solve the problems of manpower needs and the size of the work force, and can and employment due to drastic technological changes developed around 1960, and . . . built up to become a basic part of change the nature and scope of the business, the later Japanese industrial relations. . . . This practice often but only if it does not affect contract terms takes the place of collective bargaining in Japanese industry. and conditions of employment. Technology Akihiro Ishikawa, “Microelectronics and Japanese Industrial bargaining has become a focus of the collec- Relations, ” Microprocessors, Manpower, and Society, Malcom Warner (cd. ) (New York: St. Martin’s Press, 1984). tive bargaining process and the extent of em- In Germany, the development of Work Councils at the local ployee rights and employer prerogatives is shop-floor level came after World War II. These councils are decided on a case-by-case basis by NLRB and separate from unions in Germany and make many decisions the courts. at the local shop-floor level. These alternatives to collective bargaining never developed in the United States to any signif: - cant degree. 1“’NLRA gives employees the right to organize and join a union. At least 30 percent of the employees of an organization must petition NLRB to have an election, and to win certificz,- tion as a bargaining representative the union must win the votes — of a majority of the employees. Once the union is certified, the “’Marina Angel, “Professionals and Unionization, ” Min- employer is obligated to enter into collective bargaining over nesota Law Review, vol. 166, 1982, pp. 383-457. wages, hours, and other terms and conditions of employment ‘“In NLRA v. International Longshoremen Association, to develop a contractual agreement, which typically will last AFL-CIO, et al. (Case No. 84-861, June 27, 1985), the court 1 to 3 years. NLRB does not oversee specific contract terms, said “The only question thus to be decided . . . is whether Con- but can be asked to intervene if either party does not act in gress meant, in enacting Sec. 8(b)(4)(B) and 8(e) . . . to prevent good faith. Any worker has the right to file an unfair labor this kind of labor-management arrangement designed to fore- practice char= if she believes constraint, coercion, or discrim; - stall possible adverse effects upon workers arising from chang- nation has been used. ing technology. ” Ch. 5—Office Automation and the Quality of Worklife ● 165 —.—

The strategy of using collective bargaining employee association contract decreased slightly for addressing quality of worklife issues re- from 1983 to 1984 (see figure 5-4). lated to office automation is limited both by The influx of women into clerical jobs may the relatively small number of office workers have retarded unionization,’” because they covered by union agreements and by the na- were a ready supply of low-paid workers, and ture of the process; both topics are addressed have historically been slower to join unions. below. It has been suggested however that the changes in the office workplace brought on by office White Collar Unions and Worker Representation automation will increase the level of unionization among clerical workers, in those places According to BLS statistics, only 19 per- where office work is becoming routinized and cent of all U.S. workers belong to labor un- more like factory work. Alternatively, office ions and among office workers the level of un- automation can improve jobs; if unions can ionization is much lower. About 14 percent of present themselves as mechanisms for ensur- clerical workers belong to unions and about ing these improvements, they may have greater 17 percent are in bargaining units covered by appeal to office workers. union contracts. 158 Professional specialty workers have a higher level of unionization, 23 per- A policy question to be considered then is cent, but this reflects the large number of whether the Federal Government should take teachers belonging to unions or professional steps to encourage technology-related bargain- associations. Only 6 percent of executive, ad- ing in labor-management negotiations, and also ministrative, and managerial workers belong encourage other mechanisms to improve the op- to unions. }59 portunity for office workers to be represented in discussions about office automation. Unionization of office workers tends to follow industry lines; in industries where manu- Technology Bargaining facturing workers are highly organized (see Traditional subjects for collective bargain- table 5-12) they are more likely to belong to ing have included wages, fringe benefits, and unions than in other industries, such as the insurance industry, where office automation hours. Increasingly unions are also dealing has been heavily adopted. The figures show with questions of health and safety, electronic levels of union membership for broad indus- monitoring, and job security. Technological try categories; the first two rows include most change is also a major issue, but technology 160 is a difficult subject for collective bargaining. office workers. It has traditionally been dif- One recent survey found technological change ficult for unions to organize office workers, provisions present in fewer than 20 percent primarily because of their close relationship of current agreements.162 Labor organizations with management and identification with the middle class. In every occupational category, can seek to deal with technological change is- the number of workers covered by a union or sues by trying to influence: 1) the introduction of new technology per se; 2) the changing ‘Bargaining units cotrer all workers whether or not the~’ nature of the jobs; 3) changes in skills require- belong to the union. ments or status; or 4) work force reductions. ‘Paul 0, Flaim, ‘‘ l~ew Data on Union Members and Their I+; arnings, to be published in ?tfonthi.~’ Labor l?e~.iew. The choice of what technology to use (for ‘ ‘Office workers are represented by a large number of unions including the Communications W’orkers of America, Of- manufacturing or for office work) has tradi- fice and Professional Employees (OPE I U], the Newspaper Guild, tionally belonged to management, and many the United Food and Commercial Workers, the Service I+~m- ployees Internat~onal Union (SEIU), American Federation of “’Roberta Goldberg, Organizing &’omen Office Workers: (jovermnent I+; mployees (A FGI?), American Federation of State, Dissatisfaction, Consciousness, and Action (New York: Prae- County, and hlunicipal Employees (A FSCME~), and others. Dis- ger Publishers, 1983). trict 925 is a new nationwide office workers union formed by “-Cited in Km’in Murphy, Technolo~”cal (’hange Clauses in SE IU and Nine to Five: the National Association of Working Coilectitre Bargaining Agreements, Department for Professional Women, in 1981. Employees, AFI.-CI(), Publication #81-2, August 1982, p. 5. 766 Automation of America’s Offices —

Table 5-13.—Union Membership by Industry and Occupation — Industry Transportation, Financial ~ communication, insurance, Occupation Totala Mining Construction Manufacturing utlities Trade real estate Service Government All occupations .156 17.9 24.3 26.5 396 82 2,7 - 72 359 Management/professional specialist 52 1.7 86 40 11 1 18 17 67 381 Technicians/ sales/administrative 80 3.3 2,9 10.4 34.8 6.6 22 5.1 302 Service 87 (b) (b) 352 490 44 12,4 86 394 Operator/fabricator/ laborer 33.6 32.9 25,7 392 471 204 (b) 11 3 362 aTb~ totals j“~l”d~ agriculture, fOreSrw, and fishery occupations which are not listed separately. Thts number includes Private sector union membership, excluding government membership bThe data do not meet publication standards SOURCE Larry T Adams, “Changing Employment Patterns of Organized Workers, ” Month/y Labor Rewew, February 1985 pp 25-31, uses data from Current Population Survey, Bureau of Labor Statistics

Figure 5-4.—Employed Wage and Salary Workers Covered by a Union or Employee Association Contract in 1983.84

Executive, administrative, , 1 & manager I

Professional

Technicians

Sales

Administrative & clerical support

0 5 10 15 20 25 30 35

Percent of work force 1983 1984 1 SOURCE. Paul O Flatm, “New Data on Unton Members and Their Earnings, ” 10 be publlshed In the Month/y Labor Rewew labor agreements include a “management NLRA does not specifically identify tech- rights clause’ that gives management sole au- nology as a subject for the bargaining proc- thority over “processes and types of machin- ess. There has been no definitive decision on ery and equipment to be used, types of prod- whether or not management has a duty to bar- ucts to be manufactured, quality of material gain about implementation of new technology. and workmanship required, selling prices of In the past, the NLRB has: products . . . 163 . . . shown a willingness to extend the duty to ..————— - bargain over the introduction of technologi- ‘h’ Murphy, op. cit., p. 5. cal change to the decision making stage. The Ch. 5—Office Automation and the Quality of Worklife . 167

courts have tended to restrict the duty, re- In Europe, advance notice and the provision quiring only that the employer bargain with of information are usually the first steps in labor over the effects of its unilateral deci- collective bargaining agreements. 168 Advance 164 sions . . . notice typically means that management must In recent years, both the NKRB and the Su- give the workers and their representatives preme Court have tended to favor manage- enough time to consult, negotiate, and prepare ment prerogative to effect unilateral change. for the changes. Implementation of the new Yet, a recent Supreme Court decision has par- technology can be made contingent on a col- tially countered this trend. In a decision re- lective bargaining agreement. Some agree- garding the longshoremen, the Supreme Court ments specify that the employee be involved ruled that: in any job redesign.169

Elimination of work in the sense that it is Close cooperation of unions and manage- made unnecessary by innovation is not of it- ment in planning automation systems is rare. self a reason to condemn work preservation The NLRA precludes any person acting in the agreements . . . ; to the contrary, such elimi- interest of the employer from being a member nation provides the very premise for such of the union. ’70 Historically, this has meant 165 agreements. that supervisors were excluded. Therefore, if Modified forms of the management rights decisions of the planning of technological change clause have given the union or the employees are construed to be employer or managerial right to advance notice of technological change decisions, union members may be precluded and in some cases the right to consultation from actively participating in some stages of in the change. While there is no single blue- the decisionmaking. print, advance notice and joint consultation One policy question for Congress to consider seem to be the hallmarks of building a cooper- is whether the NLRA needs revision so that the ative dialog between labor and management; traditional boundaries and relationship between they reduce opposition and resistance to the 166 labor and management does not prevent a coop- change. The Communications Workers of erative planning process. America (CWA), in its agreements with AT&T and the Bell operating companies, has negoti- Cooperative planning is not easy to achieve. ated the right to advanced notice. 167 Union leaders may be uninformed about technological choices, long-term company, plans or Consultation might in rare cases mean par- industry conditions. Management decisions ticipation in the planning and implementation may be made at the national headquarters of technological change, but more often it while labor negotiations may take place on a means the right to negotiate about the adjust- regional basis. Even in Norway, where white- ment mechanisms that will accompany the collar unionization is high and where law re- change, for example, layoffs or retraining. quires management to inform unions about ———-— “’hExamples of the collective bargaining agreements are provided in i4utomation, }i’ork Organization and Stress, op. ‘ ‘Nicholas A. Ashford, “The Impact of Office Automation cit., 1984. cm the Qualit>r of W’orklife: Policy I replications, paper pre- ‘h’’ For example: “The employees shall, individuall}~ or in sented at the Office of Technolo~ Assessment S~’mposium groups, be given proper information . . about condi~ions at on the Impacts of Office Automation and Computer- hlediated the workplace that affect their own job . . . The employees shall Mrork on the Quality of l~rorklife, Dec. 10-12, 1984, p. 30, be given an opportunit~’ to take part in designing their own “ ~’Vationai Labor Relations Board v. National Longshore-. job situations as well as in the work of change and develop- men Assn., op. cit. ment that affects their jobs. Agreement on Efficienc~’ and “ Ste~en Deutsch, ‘ ‘Technological Change and Labor- Participation SAF-I.OPTK. Swedish I?mpio.\’er Confedera- hlanagement Relations, ” draft report to the Bureau of Labor- tion (Stockholm: Andren & Helm, 1982). Management Relations and Cooperati~e Prograrm, Department ‘“f’ Recently, in the case Yeshiva University v. The NLRB, of I,abor, 19/i5; used with permission. the Supreme Court ruled that faculty members were managerial ‘ Dwight 13. Dayis, “\\’orkplace High Tech Spurs Retrain- employees and therefore not entitled to organize under the ing El fforts, ” Iiigh Technology, November 1984, pp. 60-62. NLRA, see NLRB v. Yeshiva Univ., 444 U.S. 672 (1980). 168 ● Automation of America Offices — .

industry plans and conditions, actual partici- own records, and the right to file a grievance pation of unions in technological planning is if they believe their record is inaccurate.174 rare. The process of alternating cooperation, Some union contracts have focused on new conflict, and negotiation requires a large job classifications and higher pay for new skills commitment of time and resources from the in office automation. AFSCME contracts with union. 171 the cities of Los Angeles anci New York re- Several recent labor-management agreements quire wage increases when word processing have centered around quality of worklife is- systems are introduced. The contract between sues related to VDT use. In late 1984, claims Equitable and District 925 also modifies the processors at Equitable Life Assurance Com- “piece rate” pay system previously used for pany became members of District 925 of SEIU VDT workers.175The CWA contract with AT&T after a 3-year long effort. Points covered in and the Bell operating companies established the contract include requirements for detach- quality of worklife committees to deal with able keyboards, adjustable chairs, an addi- the retraining issue, and workers are notified tional rest break from VDT work, and (in some in advance when a job will end so they can cases) transfers to non-VDT work for pregnant be retrained. ’7’ An agreement between OPEIU- workers. 172 One strongly worded agreement and the New York Stock Exchange binds the seeks to prevent the routinization of work employer to train displaced employees ‘‘for an through technological change. The contract available job resulting from such technologi- between District 925 and a legal services orga- cal change or for other jobs which the producer nization states that: has available. . . .“177 In some cases, contracts have specified that some form of income main- .,. [t]he Employer recognizes that as a gen- tenance will be available to employees who eral matter the routinization of the secretarial profession through the introduction of new must be moved to lower paying jobs as a re- 178 technological changes, such as mag cards, is sult of automation. undesirable, and the Employer has no present Few unions have been able to negotiate a intention of doing S0.173 contract that guarantees no layoffs as a re- The problem of electronic monitoring has sult of technological change, but some con- drawn the attention of at least 30 unions, many tracts have set forth who can be laid off and of which represent office workers. Several, inc- what severance pay, relocation benefits, or re- luding the International Federation of Cleri- hiring preference will be given to laid-off work- cal and Technical Employees and the AFL- ers. However, the recent Supreme Court deci- CIO, have adopted the position that “no VDT sion in favor of primary work preservation for monitoring’ clauses should be included in con- longshoremen does uphold the right of the em- tracts, but thus far, no contracts have pro- ployees to keep secure their work: hibited monitoring. CWA has won contract When the objective of an agreement and its language providing that electronic monitor- enforcement is so clearly one of work preser- ing will be used for training and not for dis- vation as is the one involved here, the lawful- cipline. The SE I U-Equitable contract provides ness of the agreement under Sees. 8(b)(4)(B) that employees will be given full information and 8(e) is secure, absent some other evidence about the monitoring system, access to their of secondary purpose. 179

“Alan Westin, Privac-v Issues in the ,tlonitoring of Em- —- plo-vee Work on VDTS in the Office Environment: Practices, ‘ U. Briefs, C. Ciborra, and L. Schneider (eds. ), Svstem~: Interests, and Po)ic.v Choims, prepared for Office of Technol- Design For, Writh and B-v the [Jsers (Amsterdam: Nor-th Ho] ogy Assessment, December 1984, pp. 119-125. land Publishers, 1983). ‘ -rWalter, op. cit. “’Stephanie K. Walter, “A VDT Victory at Equitable Life ‘ ‘Davis, op. cit. Dents the Anti-Union Armor, Management Technology, Jan ] Murphy, op. cit., p. 14. ll~y 1985, pp. 6-8. “Ibid. ‘ ‘Ibid. ‘-’’Supreme Court, op. cit., 1985. Chapter 6 Confidentiality and Security Issues With Office Automation —

Contents

Privacy, Confidentiality, and Security–Definitions...... 171 Office and Data Protection ...... 172 The Period 1960-78 ...... 174 The Political and Legislative Climate ...... 175 The Third Phase of Office Automation ...... 178 The Handling of Client Data ...... 178 Security and Confidentiality Issues ...... 179 Privacy Issues in Work Monitoring...... 181 Security and Confidentiality in Automated Public Offices ...... 182 Government Guidelines ...... 183 The Special Concern About Employee Privacy ...... 183 Accidental Losses ...... 184 Comparisons With the Private Sector ...... 185 Policy Considerations ...... 185 Chapter 6 Confidentiality and Security Issues With Office Automation

Protection of privacy or confidentiality in third-generation computers. How much data recordkeeping (and security measures to ac- about individuals and groups is needed? Who complish such protection) is a concern that has will use the data? How does one determine continued from the constitutional era of quill, what information about oneself should or must pen, and copybook through the invention of be made available to others? What uses will the telegraph, telephone, typewriter, micro- be made of the information?2 The third phase phone, duplicating machine, large-scale man- of office automation—small computers linked ual filing systems, teletype, electric account- or networked—further raises these questions, ing machinery (EAM), and first-, second-, and as the ubiquitous placement of computing devices in offices gives more people more oppor- ‘This chapter as a whole draws on a report to OTA, Pri- tunities to access records. vacy and Security Issues in the Use of Persona) Information About Clients and Customers on Micro and Persona) Computers Used in office Automation, prepared by The Educational Fund ‘Alan Westin, “New Issues of Computer Privacy in the for Individual Rights, Alan Westin and I.ance Hoffman, prin- Eighties, ” Proceedings of ZFIPS 11’or]d Congress, Paris, France, cipal investigators, 1985. 1983.

PRIVACY, CONFIDENTIALITY, AND SECURITY–DEFINITIONS

Since analysts from various fields and dis- Confidentiality and security are related but ciplines write about privacy and security is- not synonymous. Confidentiality addresses the sues, there are differences in the use of terms use of data about individuals. Security is con- and concepts by these practitioners. In the cerned with the accidental or intentional theft, broadest sense, privacy is a set of values deal- modification, or destruction of data. Breaches ing with individuality, autonomy, personal of security may compromise privacy; for ex- space, and personal information.3 Privacy deals ample, the theft of a mailing list stored on mag- with the rights of an individual to limit others’ netic tape is a result of poor security and may access to information about oneself, and the compromise the privacy of individuals on that social or legal rules by which such claims are list. The breaches of security may also be un- accepted or rejected in particular contexts. related to privacy or confidentiality.4 Viewed as a desirable attribute of the data and Respect for privacy in office automation in- the way it is handled, this is better termed volves three components: “confidentiality’ ‘—the protection of privacy. Security deals with a data-collector’s capac- 1. Data collection—what personal informa- ity to safeguard the existence and integrity tion is relevant, necessary, and socially of the data it has collected and to provide the acceptable for an organization to collect proper degree of confidentiality as set by or- to carry out its missions? ganizational or legal policy. 2. Protection—when should an organization record and preserve identified personal data, who should have access to it within ‘For a general discussion of privacy and how it is defined and used in policy see, Priscilla M, Regan, “Personal Informa- ‘A representative discussion by EDP experts of the relation Policies in the United States and Britain: The Dilemma tion between privacy and security considerations appears in of Implementation Considerations, Journal of Public Poiiq’, Alexander Gaydasch, Jr., Principles of EDP ilfanagement vol. 4, No. 1, 1984, pp. 19-38. (Reston, VA: Reston Publishing Co., 1982).

171 172 ● Automation of America’s Offices

the collecting organization, and under 1983, another survey by Louis Harris6 indi- what circumstances can it be released out- cated that the proportion of the public con- side the organization to third parties? cerned with privacy had increased further, 3. Notice and access–when can the subject from 64 to 77 percent. of data collection know that an identified This chapter is concerned with both con- record has been created about him or her, fidentiality and security issues raised as more have the right to examine the record, and and more organizations introduce new office be able to challenge the accuracy, com- technologies, in both the private and public pleteness, or proper use being made of the sectors. While privacy or confidentiality and record? security are interrelated, this chapter first dis- Survey evidence suggests that American:~’ cusses confidentiality and privacy issues, then concerns about privacy are rising. A Louis security issues in the protection of personal Harris Survey indicated that during the period and client data.7 of 1970-78 American concern about the hvi~- ‘Louis Harris & Associates, Inc., The lioad After 1984: The sion of privacy rose from about 33 to 64 per- Impact of Technology on Society-A Nationwide Survey of the cent.5 This public concern was a factor in bring- Public and Its Leaders on the New Technology and Its Conse- quences for American Life. Harris study No. 832033, 1984. ing about Federal privacy legislation. There “Confidentiality and security of data involved in off-shore was also a shift in employee attitudes about sourcing of data-entry work are discussed in ch. 8. Issues of the prerogatives and responsibilities of em- software security are being addressed in another OTA report, intellectual Propertey Rights in an Age of Electronics and In- ployers with regard to employee data, adding formation (winter 1985). Issues related to the security of Fed- further impetus to Federal policy activity. By eral information systems are being covered in the OTA report, implications of Federal Government Information 7’echnolog.y (winter 1985). Privacy issues in electronic surveillance are cov- ‘> The Dimensions of Privacvv: A National Opinion Research ered in Electronic Surveillance and Civil I.iberties, OTA-CIT- Survey of Attitudes Toward Privac~r, conducted for Sentry I 1- 293 (Washington, DC: U.S. Government Printing Office, Oc- surance by Louis Harris & Associates and Alan Westin, 1973. tober 1985).

OFFICE AND DATA PROTECTION Much of the rising concern about confiden- there is a trend for broader or more detailed tiality and security has been occasioned boy personal information to be collected.9 Concur- the advent of computers and large data banks, rently, this proliferation of computers is lead- and these concerns have repeatedly been sub- ing to decreasing compliance by managers with jects of congressional action, resulting in new government-privacy regulations (45 percent). laws. 8 End-user computing, in which many peo Networking, computer-based messaging sys- ple may access and use organizational data- tems and electronic mail will exacerbate these bases, raises new questions about how claims problems still further as personnel data can to privacy can be respected and the confider~- be circulated among more people. tiality of information be assured. In a recent Computer crime legislation passed in the survey of privacy and security professionals, almost half, 47 percent, believed that as a re- 98th Congress established penalties for indi- sult of the third phase of office automation ‘Westin and Hoffman, op. cit., 1985. This survey was not a representative sample of all types of organizations affected ‘In the mid-1960s, a Senate investigation was held to exanl- by office automation. Rather, the participants were chosen based ine the kinds and amounts of personal information collected on their reputation in computer and business circles as active, by the Federal Government. This investigation is considered advanced, and unusually skillfull users of office-systems tech- by many to be the beginnings of the national expression c~f nology and as leaders in dealing with the employee-relations concern about the collection and use of computerized personal and organizational change aspects of new office technologies. records systems. (U.S. Congress, Senate Committee on the Ju- However, there is a paucity of quantitative data on the extent diciary, Subcommittee on Administrative Practice and Proce- of the privacy and security problems. Thus, the information dures, Government Dossier) (Washington, DC: U.S. Goverrl- reported from this survey should be treated as indicators of ment Printing Office, 1967). problem areas and not as indicators of the extent of the problem, Ch. 6—Confidentiality and Security Issues With Office Automation ● 173 viduals convicted of theft, fraud and abuse Today, people who never participated in the associated with Federal computer systems. sociocultural system of EDP environments, The first indictment and conviction under the who have not been informed about the fine new Computer Crime Act involved a person points of the law and ethics of protecting con- convicted of misrepresenting himself as a valid fidentiality or assuring data security, have user of the computer system, establishing a easy access to an organization’s databases. super user code allowing future access to the Violations can result from carelessness as well computer he worked on and other systems to as through intent. which it was linked. This chapter differentiates current office As organizations rely more and more on automation issues from the confidentiality and computer-based information to conduct their security problems that have been present in business and to keep track of their personnel, many organizations for two decades as part the privacy rights of clients and employees of an EDP system. This distinction between must be considered. Coupled with the fact that centralized and end-user automation is prob- the purchase and installation of microcom- ably transient and likely to disappear as offices puter systems is often haphazard and uncon- tie their small computers into the larger EDP trolled within organizations, an appropriate systems highly integrated information sys- degree of confidentiality is more difficult to tems. The transient nature of current systems assure when access to data is widely distrib- is important for policy considerations later, uted. Personal information is required to ef- and the distinction is useful in discussing new fectively run a business, and with telecommu- problems that arise with office automation. nications linkages between computers and Three developments in office automation are between organizations information can be col- central to confidentiality and security issues, lected in greater quantity and shared more eas- not only because they deal with the techno- ily. Client information can be processed at the logical changes mentioned above, but with how client’s workplace and sent via phone lines to the technology is procured and installed: the organization’s computer system for processing. Office automation also raises questions ● the arrival of stand-alone word processors about traditional security measures in central and text editors in the late 1970s, per- electronic data processing (EDP) environments. ceived as higher-order typing instruments The purchase and use of computers in office and generally procured and controlled by automation is not controlled by a single de- office administration staffs or user department. Once microcomputers are linked partments; with larger computer systems, any individual ● the move to widespread professional mi- on the system has the potential for unlimited crocomputers, now available at prices and access and distribution of information. with features that allowed organizations to procure them for stand-alone work, and Before the recent wave of office automation, not only when linkage to on-line main- the principle users of a computer system were frames and minicomputers was involved. professionals, and the two chief dangers were Generally, these machines were ordered theft of funds or data by employees, and that by user departments; though often with of novices external to the organization break- EDP-department guidance; and ing into the system. The dispersal of computers ● the explosion of personal computers (PCs) throughout an organization has extended ac- in the early 1980s, for professional, sales, cessibility to noncomputer-professionals. The and executive use as stand-alone comput- computer professional’s sociocultural system ing devices, and increasing linkage of such had within it values, beliefs, and concerns PCs to minis and mainframes. PCs in most about privacy and security of information. organizations were ordered by individuals or by user departments, with limited guid- ‘Counterfeit Access De\’ice and Computer Fraud and ance or control by EDP departments or Abuse Act of 1 9X4, Public I.aw ‘38-473. central administrative service functions. 174 ● Automation of America’s Offices

Each of these developments fostered new The following quote demonstrates the ca- ways of carrying out office work. By 1984-85, pabilities of the convergence of the various of- each of these three original types of stand-alone fice technologies: terminal/software machinery were being linked In IBM we now have a world-wide network to minicomputers and mainframes. This build- of more than 1,500 mainframes and 200,000 ing of communication between computers makes terminals. Any user at any terminal can send possible access to central or distributed data- a message or a file to any other user. A user bases. In the survey of computer security pro- at any of those more than 200,000 terminals fessionals mentioned above, 64 percent believed can connect to any application in any of those that the spread of electronic mail and messag- 1,500 systems. Programs and even entire ap- ing systems poses a real problem in maintain- plications spread spontaneously through the ing confidentiality. The ability to download network, usually without management direc- (take data from) or upload (add data to) main- tion or intent and often without management frame databases, using small computers, makes understanding or knowledge. Employees can it possible for any employee with access to the access the network from their homes. Some vendors and contractors use it . . . [DP] man- building or computer to generate a file of per- agement did not plan it. They bought it and sonal information. Seventy-six percent of the built it but they were just as surprised as any- survey respondents felt the automated office one else when they saw what ‘God had environment allowed more people physical ac- wrought. ’11 cess to workstations and disks as compared to earlier waves of automation. Finally, the interconnection of microcomputers allows the exchange of data within units or across units “W.H. Murray, “Security Programs, Functions, and Con- cepts for the New Computer Economics, ” Proceedings of the of the organizations, independent of mainframe 1 lth Annual Computer Security Conference (Northboro, MA: system controls. Computer Security Institute, 1984).

THE PERIOD 1960-78 EDP systems made it possible for client data vital compartments and boundaries that helped to be: keep client information confidential. This is

● what the privacy-and-data banks debate of the collected and recorded more easily; 12 1970s was about. ● analyzed, compared, and collated more fully; There were also several aspects of internal ● distributed to or made accessible to more organizational control in the 1960-78 era, be- people within the organization; fore end-user computing, that provided the ● amalgamated with data on individuals ob- framework for carrying out new privacy rules tained from other organizations having that were developed: computerized record systems; and ● in the EDP era, small staffs of EDP ● disseminated more widely, both in intra- professionals ran the data centers and con- organizational networks and in response trolled access to automated files; and to specific demands from other organi- centralized security procedures of access zations. and audit were available to check (if nec- These capabilities made it possible to pro- essary) that terminal users followed the vide more customized and personal services legal and organizational rules. by business and government. They also raised “For an early discussion of the debate see, U.S. Senate, the possibility of greater aggregation of data-- Committee on the Judiciary, Subcommittee on Constitutional computerized databases can break down the Rights, Federal Data Banks and Constitutional Rights, 1974. Ch. 6—Confidentiality and Security Issues With Office Automation 175 —- — .

Computer-system security measures origi- rity of computer systems took on added im- nally evolved from manual techniques for portance and led to additional safeguards such physical security carried over from the elec- as logs, journaling, of important operations tronic accounting machines of the 1950s. Usu- and more specific policies with respect to com- ally physical security (locking up sensitive card puter security, as a means to guarantee con- decks and tapes) was the prime technique. As fidentiality and accountability. However, the first and second generation batch processing most sensitive narrative information was still computer systems were introduced, followed not computerized at this time; it remained on by remote terminals and third generation sys- paper in manual files. Thus, most problems tems, computer security techniques became involving personal data in the 1970s still were more technological and sophisticated. Passwords associated with paper records. In the early were used to restrict access to information 1980s, medical, banking, credit and employ- based on a user’s or terminal’s privileges or ment information was placed in large data- on the type of function being performed. A bases, beginning the current rapid move to few systems, especially those involved in na- store personal, employee, and client data tional defense, used cryptography or encipher- on-line. ing. Some systems provided other mechanisms The advent of commercial products to en- to assist proper authorization, most notably hance computer security, such as the ACF2 the hardware rings provided by the GE/Honey- access control package for IBM mainframes well machines of the late 1960s and early 1970s. and various vendors’ versions of the National During this period, it was hard enough to get Bureau of Standards Data Encryption Stand- a program to run at all on a given hardware ard had not yet been introduced. Leading man- system, and security took a back seat to other ufacturers were starting to take seriously the design criteria such as correctness, speed, cost, task of educating users about these issues. An and utility. advance guard of computer practitioners were As third generation computer systems be- becoming knowledgeable about computer secu- came more common in industry and govern- rity issues. “Second-generation” technologi- ment, the use of data within organizations cal security issues (e.g., the idea of kernels in changed and networks were built up. Rather software engineering)13 were just starting to than use one computer center, one or more sys- be investigated. tems could be accessed via user terminals. In- deed, commercial time-sharing networks grew to service the needs of organizations without ‘‘A security kernel is a small nuclear piece of the operating the resources or inclination to start their own system that controls access to other parts of the computer networks. Minicomputers (minis) appeared, system—either information or data. This nucleus itself must but in contrast to today’s microcomputer sys- be tamperproof so that its programs maj not be modified, allowing system operators to verify whether it has implemented tems, minis were generally still purchased and the systems security policy through the programs. See G.J. operated by data processing specialists within Popek and C.S. Kline, “ Issues in Kernel Design, ” Ad~-ances the organization. in Computer Seczmit.}r, Rein Turn (cd. ) (Dedham, MA: Artech 130use, Inc., 1981), pp. 139-144; and R.C. Summers, “An O\rer- At the same time, there was growing public view of Computer Security, ” Il?ltf SJwtems Journal, vol. 23, No. 4, pp. 309-325. This de~’elopment has been primarily in awareness of potential loss of privacy and prob- the Department of Defense; there are no commercially a\ail- lems of fairness or due process. Thus, the secu- able security kernels.

THE POLITICAL AND LEGISLATIVE CLIMATE The response of American society to both ied, 14 By the late 1970s, a detailed latticework the social change aspects of privacy protec- ‘See for example, J$’. H. YI’are, “ Information Systems Secu- tion and the computer-based handling of per- rit~r and Pri\’acy, ” (’mnmunications of the ,4(’11, ~ol. 27, No. sonal data by organizations has been well stud- 4, 1984, pp. 31.5-321, 176 ● Automation of America Offices

of laws, regulations, organizational policies, many private and public organizations devel- and social expectations regarding privacy pro- oped “privacy codes” or “fair information prac- tection in EDP systems had been put into tices standards” to govern their own handling place. Codes of “fair information practices” of client or employee personal data. The mo- were embodied in law or organizational stand- tives for such action were a blend of concern ards to govern the collection, use, and release to meet legitimate privacy concerns of clients of personal data on clients and customers, and and employees; the desire to avoid the neces- to make this process visible and accountable sity of detailed legal regulation; and the judg- to both data subjects and the public. ment that fair-information-practices rules had Laws and regulations were promulgated to a generally positive effect on accuracy, com- deal with privacy in particular fields of or- pleteness, and timeliness in the management ganizational recordkeeping-Federal agencies, of automated data systems, and could be ini- banking, insurance, health care, education, tiated without heavy costs in money or effi- credit-reporting, employment, law-enforcement, ciency. A few corporations such as IBM, Bank etc. ” The earliest statute was the Fair Credit of America, and Control Data Corp. had also Reporting Act of 1970 (15 U.S.C. 1681). This developed employee privacy codes in the early act requires all credit investigating and report - to middle 1970s, but most of the 10,000 large ing agencies such as banks and retail charge private employers in the United States had card firms to make the records they collect not. available to the subject. Furthermore, it pro- By the time that end-user computing began vides procedures allowing the subject to cor- to add new dimensions to the handling of per- rect the information. Finally, it only allows sonal data in office work in the early 1980s, disclosure to authorized customers. Since thi:s there were still debates among privacy advo- statute, many more have been enacted pro- cates as to whether the data collection and the viding protection policies for information confidentiality aspects of privacy had been ade privacy. quately dealt with, in what was coming to be The Crime Control Act of 1973 requires that called the “first-generation” of privacy pro- State criminal justice record keeping systems, tection measures. In spite of the emphasis on developed with Federal funds, ensure the pri- notice, challenge, and due process rights of vacy and security of the information collected. data subjects, and workable procedures for The Privacy Act of 1974 (5 U.S.C. 552a) re- strengthening confidentiality rules, critics ar- stricts the collection, use, and disclosure of gued that there had been too few limitations individually identifiable information by the on what was appropriate information to col- Federal Government. It gives the individual lect about people’s transactions and activities rights to access the information and to cor- in many sectors of business and government rect it. life. They also argued that merging data from The Tax Reform Act of 1976 (26 U.S.C. 6103) different organizations about the same indi- protects the confidentiality of personal tax in- vidual (e.g., in computer matching programs) formation. It restricts disclosure of tax infor- threatened to shatter basic confidentiality mation for nontax purposes. standards. In furtherance of such laws, and in manly There was also debate among informed ob- areas where no legislation had yet been enacted, servers and the media about whether the nec- —.— essary machinery with which to enforce pri- 1’Exampl=s would be the Federal Privacy Act of 1974 ( 5 vacy rights had been created, and about other U.S.C. 552a); the Federal Freedom of Information Act Amenc.- questions—the implementation of the Federal ments of 1974, and similar “jurisdiction-wide” statutes in 12 States. At the statutory level, this is exemplified by the Fan--- Privacy Act of 1974, the desirability of a con- ily and Educational Privacy Amendments of 1974 (20 U. S. C’. tinuing Privacy Commission or Privacy Om- 12239), and by State medical, banking, insurance, and employee- budsman (as Canada and many European coun- privacy legislation. tries have), and U.S. Supreme Court rulings Ch. 6—Confidentiality and Security Issues With Office Automation . 177 — in matters of data collection by business and and State laws on insurance, employment, and government organizations.16 medical privacy did broad private sector in- stitutionalization of privacy rules take place. The report of the U.S. Privacy Protection The establishment of organizational proce- Study Commission in July 1977 urged new dures and regulatory or judicial enforcement laws and voluntary codes in the private sec- of privacy was just becoming the norm when tor. What followed was a new series of stat- end-user computing began to spread in the utes that affected information privacy. early 1980s. The Right to Financial Privacy Act of 1978 In the mid-1980s as office automation is (12 U.S.C. 3401) limits the access of Federal agencies to information about the customers spreading, an extensive set of confidentiality proof financial institutions, by describing the protections for manual and EDP systems has been cedures necessary to obtain that information. put into place; but debate continues as to wheth- It also provides bank customers other assur- er these protections are adequate in scope and ances of privacy about some aspects of the are being vigorously administered. bank records. The laws above basically deal with rights The Privacy Protection Act of 1980 (42 U.S.C. to confidentiality. Until recently, no Federal 2000aa) prohibits government agents from conducting unannounced searches of press of- law dealt specifically with sanctions against fice and file records if no person in the office the use of computers by individuals to com- is suspected of having committed a crime. mit a crime, or with trespassing by reading The Electronic Funds Transfer Act of 1980 private computer files.]’ In October 1984, Con- states that any institution providing EFT or gress passed the Counterfeit Access Device other services must notify customers about and Computer Fraud and Abuse Act of 1984, third party access to customer accounts. which makes it a felony to access confidential The Debt Collection Act of 1982 (Public Law or restricted information related to national 97-365) establishes due process procedures security without authorization, and makes it that Federal agencies must go through to re- a misdemeanor for unauthorized persons to lease any information about bad debts to access the data banks of financial institutions, credit bureaus. or to use, modify, destroy, or disclose infor- The Cable Communications Policy Act of mation in a government computer. 1984 requires any cable service to inform the There are of course many criminal laws that subscriber of any personally identifiable information collected. They must inform the user can be used in prosecuting computer-related about how the information is to be used and crime, but there are problems in applying many how long the information is maintained on rec- of the laws defining theft to cases where only ord. If the information is disclosed, the indi- “virtual property” (nonphysical property) is vidual must be informed and restrictions are concerned. Thirty-three States now have com- placed on how and to whom information is dis- puter crime laws, but some do not cover hackers closed. who penetrate systems for fun rather than Only after the passage of new privacy legis- profit. ” lation in 1978-82 protecting bank depositors, ‘“The Privacy Act of 1974 (Public Law 93-579) and the ‘There were debates over whether new systems or applica- Crime Control Act of 1973 (Public Law 93-83, sec. 524(b)) are, tions were covered by “first generation’ privacy measures; for however, designed to prevent misuse of Federal records of all example, electronic funds transfer (EFT) systems, two-way ca- kinds in ways that would violate the privacy of citizens. ble systems, and Postal Service electronic-mail projects. There “List provided by the National Center for Computer Crime was also concern that plans for large sophisticated computer Data (Los Angeles) includes Alaska, Arizona, California, Col- systems as replacements for older systems in the Federal Gov- orado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, ernment might go forward without sufficient attention to Illinois, Iowa, Maryland, Massachusetts, Michigan, Minnesota. privacy risks, for example, the proposed FBI “Triple 1“ sys- Missouri, Montana. Ne\ada, New Mexico, North Carolina, North tem for processing criminal history records, and the planned Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South IRS, Social Security, Secret Service, and Veterans Adminis- Dakota, Tennessee, Utah, Virginia, Washington, Wisconsin, tration systems. and Wyoming. 178 Automation of America’s Offices —.

THE THIRD PHASE OF OFFICE AUTOMATION The Handling of Client Data control or notice, and portable versions can be taken home or on trips. Information is ar- Confidentiality in an organization with new chived on floppy discs rather than magnetic decentralized or networked office technologies tapes. requires consideration of a number of new Less sophisticated office automation users. factors: While 10 percent of organizational personnel may have been using terminals in the middle Low-security or no-security physical envi- 1970s, either in EDP units or as EDP-trained ronments in offices. Except for military, diplo- operators in users’ departments, at least 25 matic, and a few private-sector settings that to 35 percent of personnel in large organiza- operate in “highly sensitive data” modes, most tions are probably using microcomputers organizations have put microcomputers onto today, and eventually this may approach 100 desks in working areas that are open to pass- percent. Typically, new users have not been ing fellow workers, service personnel, invited educated about confidentiality issues or secu- visitors, or even the general public. Storage rity protections. of diskettes, location of printers, and other peripheral equipment is also usually in unse- Uncontrolled channels of data communica- cured environments. tions. Electronic message systems, bulletin boards, and microcomputer networks encour- More finished and relined information in of- age users to send messages to everyone using fice automation systems. In most organiza- these systems or to create their own distributions, word processors contain finished cor- tion lists. As a result, messages with confiden- respondence, memoranda, documents, charts, tial data can move around either anonymously, and reports. These stored materials may con- or without control for their confidentiality. tain sensitive personal information on clients, Fraudulent memos can be circulated for polit- proprietary data of the organization, informa- ical purposes without an easily traceable ori- tion confidential to particular employees or gin. Reproducing machines, and before them, units, and data about terms of contracts and mimoegraph machines had the same effect, of other legal responsibilities. While much raw course; computers merely allow this commu- data and some reports of this kind are in main- nication to be done in the privacy and safety frame storage, the information in word proc- of one’s own office or home. 19 essors or professional/executive microcomputers is generally more complete, revealing, and Wide ability to add information to or copy easily found, because it includes explanatory or extract information from corporate databases. text. Controls over alteration of data or unauthorized access become critical.20 Microcomputers More readily accessible information in of- can be used to attack the security of main- fice computer systems. An interloper, whether frame and mini data, and obtain confidential an employee or someone from outside, who client data improperly. This can in fact be done seeks to extract sensitive data from the main- from any terminal, including those developed frame database generally has to know special- for mainframe use, but more understandable ized mainframe software codes, as well as how to deal with special security protections that most organizations have built into mainframe This situation may seem trite, but a recent State supreme court ruling stated that an employee’s privacy had been vio- databases. With microcomputers, unskilled in- lated by an interoffice memorandum. “S,JC Outlines Rules on terlopers are more able to call up data on E~mployer Rule in Workers’ Privacy, ” Boston Globe, July 7, screens, print out documents, or copy disk- 1984; as cited in Philip Adler, et al., “Employee Privacy: Legal ettes than they would be in EDP systems. and Research Developments and Implications for Personnel Administration, ” Sloan Management Review, winter 1985, pp. The mobility of microcomputers and their 13-22), In this case upheld by the U.S. Court of Appeals, First data-storage media. Dumb terminals con- Circuit on Aug. 6, 1984; the memorandum was on paper. nected to mainframes are known to the sys- “’This does not address. the problem of unauthorized users tem, and their uses are usually logged or mon- external to the organization accessing the databases. One commonly suggested procedure is the use of tiered passwords for itored. Microcomputers can be moved around accessing the computer and then the particular volume or file within organizational offices without central the information is stored in. Ch. 6—Confidentiality and Security Issues With Office Automation 179

software instructions are expanding the num- put personal client information into “their” ber of persons able to probe password secu- files that violate laws, regulations, organiza- rity, attempt unauthorized entry, or alter con- tions rules, or ethical guidelines. If there is fidential data. no auditing or physical inspection of end-user Little or no hardware or software security files, then management may be unaware of protections. Because of the ways that word such conduct, and suffer legal sanctions or processors and microcomputers entered office have the companies reputation compromised. work, there was neither a perceived necessity or an assumed “market demand’ for built-in Confidentiality terminal hardware protections such as locks on the machines. Similarly, in buying or de- End users may take client information from signing software for office systems, organiza- central files and merge it or match it with other tions have generally not specified audit trails, client data in ways that violate privacy stand- cryptographic protections, and other measures ards. Through electronic mail and message sys- that could have been installed–though at tems, end users may send confidential client added costs. information inadvertently to those not enti- Unpredictable individual and group behavior. tled to have it, especially if “automatic” dis- There is no way to predict with any assurance tribution lists are used. how office employees and managers will use these powerful new capacities. There will be Subject Notice and Access some conduct by insiders and outsiders arising out of the new opportunities in microcom- Where end users create files improperly or puter use that pose risks, and this has to be record confidential data they should not have the perspective from which managers assess accessed, failure to inform clients that such risks to confidentiality and security. files have been created and might be used in making decisions about clients could be a vio- Security and Confidentiality Issues lation of several basic privacy laws (the Fed- eral Privacy Act, State fair information prac- The potential vulnerabilities to client data tices acts, Fair Credit Reporting Act, State emerging in office automation can involve ei- insurance privacy acts, etc.), as well as the or- ther new situations created by microcomputer ganizational rules of many banks, insurance use, or can be extensions of familiar risks in firms, brokerage houses, medical facilities, edu- manual and EDP recordkeeping. The types of cational institutions, and other private orga- potential end-user conduct that could violate nizations. Failure to provide opportunities for existing privacy standards are discussed be- individual clients or potential clients to exam- low. ” ine and challenge these files would be a viola- tion of such laws or rules. Data Collection Microcomputers permit the creation of any It is critical to distinguish the privacy is- files or databases that the end user wishes to sues generated by the transition from manual maintain. Either without awareness of or in record systems to EDP systems, from those deliberate disregard of privacy, end users may of the current progression from centralized to decentralized computing. The arrival of EDP brought about revolutionary increases in two I+; xamining such potential twlnerabilities in office automation follows the studies of EDP s~stems impact done by the areas: 1) data-collection capacities (reducing National Academy of Sciences in 1969-72; the HEW Ad\risory costs and time constraints, magnifying data- Committee in 1972-73: and the U.S. Pri\acy Protection Study analysis capabilities, etc.); and 2) data-sharing Commission in 1975-77. Hopefully, the examination of potential office automation ~wlnerabilities can benefit from the ex- capacities (circulating personal data within and periences with risk-assessment and reality-testing that were between organizations). The response in terms de~’eloped in 1969-77 EDP studies, as well as the practical ex- of privacy laws and organizational codes was: periences gained o~’er the past decade in administering the standards promulgated (for client data) as the ‘*first generation’ of 1) to increase the visibility of organizational pri~ac?’ and securit?r rules. activities affecting sensitive personal data 180 Automation of America Offices

(changing these from private “kitchen work’ not been taken up yet by most top manage- to public notices and descriptions, with spe- ments, and thus the policy directives and cific rights of data-subject inspection chall- budget authorizations necessary to address enge); 2) to stipulate broad relevancy and so- this problem adequately have not existed in cial acceptability standards for data collection; most private-sector organizations. The major and 3) to provide rules and procedures for con- problems developing with decentralized office fidentiality or data sharing. automation are: The use of microcomputers in the office has Lack of clear identification of sensitive in- the foIlowing characteristics: formation. The basic requirement for sound security is to identify information that is sen- ● They do not significantly increase the sitive and needs special protection. Any effort scope of data-collection capacities over ex- to protect all personal information in ordinary isting EDP systems. However, because business or government organizations would of their ease of use or cost, data not en- be too costly and would virtually paralyze or- tered into the mainframe system can now ganizational programs. ’z be entered, potentially increasing the Failure to provide adequate physical secu- quantity of data collected. This requires rity for machines and storage media. Many managers to provide greater education microcomputers are not kept in locked rooms and oversight of users to see that they and diskettes are often not kept in locked cab- know the limitations on data collection inets or desks. Easy physical access to such set by law or code, and do not violate these microcomputer equipment poses real security in “personalistic” data recording. risks; for exampIe, diskettes can be copied on another machine on or off the premises. ● They do increase the risks of improper circulation of personal client (or personnel) Failure to have key locks on terminals. Most data within the organization and to out- microcomputers do not have key locks that control on-off functions, enabling third par- side organizations, threatening confiden- ties to activate them. tiality, because they provide many more employees with a tool for accessing the Weaknesses in password systems governing access to central databases. Microcom- records or information. puters connected to mainframes in many or- ● They do increase due process problems. ganizations suffer from the same security To the extent that stand-alone-diskettes problems as dumb terminals; users are casual and off-line storage of personal client data about writing down or telling their passwords would not be known to data subjects, the to others. But microcomputer users are prob- use of that data for decisionmaking could ably less disciplined in handling password reg- not be challenged under privacy rules for ulations than EDP-trained personnel. subject access. No logs or journals. Though central databases of confidential client data are often pro- Security vided with audit trails, transaction logs, or journaling capabilities, these techniques are How to protect records from accidental or often not used when groups of microcomputers deliberate destruction, loss, or theft is a secu- are connected to minicomputers or, through rity question. There are also differences be- them, to mainframe files. tween EDP and decentralized office automa- Not recording efforts to penetrate security. tion. Surveys of private organizations show Unlike mainframe systems, microcomputer- general agreement that by the end of 1984 based office systems generally do not record there were significant security issues in use efforts to enter restricted files without proper of microcomputers, not just for sensitive cli- identification or passwords, or warn security ent and personnel data but also for general officers that such efforts have taken place or proprietary business information, financial are under way. data, national security information, and legally -’Many European countries do attempt to protect a large sensitive information. These problems have amount of the personal data collected. Ch. 6—Confidentiallity and Security Issues With Office Automation 181

Absence of either security education for cial measures. For example, if combined voice/ users or auditing of their practices. Even if data terminals are widely used, manufacturers sensitive information was identified, security may have to provide means of preventing the measures were adopted, and records were kept undetected turning on of the microphone ca- of efforts to access databases improperly from pabilities of terminals, to ensure that neither microcomputers, most experts would agree officials within the organization nor outside that security of sensitive client data also requires that users be educated about security hackers, or more serious intruders, used these policies and procedures. Second, it requires terminals for organizational espionage. that inspections or auditing be carried out to Local area networks present particular prob- learn whether security policies are being lems. Three different types of network config- followed. urations exist and present different security When it comes to security measures needed problems. In a star network, several terminals to safeguard sensitive client data in microcom- are connected to a central controlling device; puters and end-user office automation, current the central computing power can be used to evidence shows that: 1) the techniques for in- control data and software, maintaining a high stalling security protections are well known; degree of security. In a ring configuration (or 2) the process of risk-assessment and vulnera- a loop) the workstations are arranged in a cir- bility analysis to determine cost-beneficial pol- cular network. Each station is linked by a icies is well known; but 3) these techniques repeater mechanism that monitors all pass- and processes have just begun to be under- ing information to see if any are addressed to taken in the private sector, and are only some- that workstation. This configuration has gained what further advanced in the Federal estab- more acceptance in Europe than in the United lishment. The first task in dealing with security States. Because information travels around the is not to identify wholly new security approaches ring, any workstation has the capability of ac- or methodologies, but to stimulate organiza- cessing it. The tree or bus network, the most tions to provide directives and resources with easily expandable of the three, does not require which to modify and apply known techniques a central controller and, security is therefore and processes. contingent on the security capabilities of individual workstations. There are some situations in which new forms of office automation may require spe-

PRIVACY ISSUES IN WORK MONITORING The monitoring of office work by computers pros and cons of computerized-work monitor- was discussed in chapter 5; but it is sometimes ing, it is probably not best posed in terms of discussed as a privacy issue rather than as privacy. The work is done on the employer’s a quality of worklife issue. The privacy issue premises; the activities are usually group set- raised by computer-mediated work monitor- tings open to view rather than individual activ- ing is whether the collection of operator per- ities taking place in closed or private rooms; formance data through “machine capacities” supervision is a normal condition of the em- and its use to evaluate employees constitutes ployer-employee relationship; and collecting an intrusive form of ‘‘employer surveillance’ quantitative data as to employee output has that violates reasonable expectations of per- long been used in evaluating and compensat- sonal privacv by the employee. Whatever the ing work performance in factories and offices. 182 automation ofAmerica Offices

Unlike the use of TV-monitors to watch as- ployees know that monitoring systems are sembly lines, or of hidden microphones to over- used, employees have access to their individ- hear workers in cafeterias or restrooms, the ual records; and a procedure is provided for collection of operator-production statistics contesting the accuracy or fairness of apply- generated by system software does not repre- ing records for evaluative purposes. sent an intrusive act per se, provided that em-

SECURITY AND CONFIDENTIALITY IN AUTOMATED PUBLIC OFFICES The protection of data is a major concern the Department of Health and Human Serv- in public-sector offices, especially in regard to ices, which administers the program, matches matters of national security, diplomacy and one’s name with those in the Internal Reve- foreign relations; the Federal role in monetary nue Service (IRS) earnings file (which is in fact transactions; government funds transfers; and maintained and used by the Social Security foreign trade. Most of the sensitive informa- Administration (SSA) to verify eligibility. SSA tion about such subjects, however, is usually checks the data in the IRS earnings file to ver- in large computer and communication sys- ify income reported by recipients of SSA retire- tems, and is usually protected by encryption ment benefits.25 and a variety of other mechanisms. However, In general, information-handling associated shared databases and the downloading of data with end-user office automation is not classi- to microcomputers for end-user computing is fied information, but it is often sensitive in- raising new concerns, especially since data that formation, especially when aggregated in are not per se identified as sensitive can, when 26 certain ways. Routine records, forms, and cor- aggregated, reveal information that is highly respondence often contain information that sensitive. would allow individuals to put together and The Federal Government collects large vol- profit from advance knowledge of government umes of detailed personal data about citizens actions. For example, plans for siting high- and in particular about Federal employees. As ways and government facilities, impending early as 1967, a study of computerized Fed- regulations, actions that affect interest rates, eral records revealed that the files contained sales of minerals and timber rights, etc., are more than 3 billion records and that over half very tempting. Personal data about Federal of them could be accessed via computer ter- employees can be used to discourage whistle- minals.23 Several years later in 1974, another blowing. Less often voiced, but still important, congressional committee found that 86 per- is the concern about unauthorized access to cent of the 858 known government databanks were computerized.24 Successive waves of of- ~ According to briefings and interviews provided for OTA by SSA. fice automation have continued to provide -“This has chiefly been of concern to the Department of De- greater access to these expanding data files. fense; for example, the problem was exhaustively discussed This information can be integrated through in a planning conference held for the U.S. Army Information Systems Command by SRI in Tucson, AZ, in December 1984. computer matching and other techniques and Hypothetical examples given in an informal talk concerned the through the exchange of data between agen- possibility of aggregating routine travel orders or schedules cies and with State governments, in ways that for key individuals to reveal the (undisclosed, sensitive) location and timing of small meetings; or the possibility of aggregat- cause deep concern about confidentiality. For ing data on materials delivery to a site to reveal information example, when one applies for Food Stamps, about development of weapons systems, However, some civil liberties specialists have long been concerned about the ability to aggregate information from many sources about one indi- Go\,ernn]ent Dossier, op. cit. \’idual to produce a profile of his or her marital, financial, so- ‘Federal Data Banks and Constitutional Rights, op. cit cial, business, professional, and political activities. C/J 6—Confidentiality and Security Issues with Office Automation ● 183 information that is simply embarrassing or po- Government Guidelines litically fatal to officials or to their nominees for official positions. In congressional mem- Security and confidentiality for nonclassi- bers’ offices, there are grounds for concern fied government information is covered by the about protection of information in computers, Privacy Act of 1974 and: which is chiefly protected by ID’s and pass- OMB Circular A-71 Transmittal Memo words. (The privacy and security issues related No. 1, July 17, 1978, which provides gen- to large Federal computer systems and data- eral guidance to agencies, on administra- bases will be covered in a forthcoming OTA tive, technical, and physical measures to 27 report. increase security; and Even when nonclassified Federal data is nor- OMB Circular A-123, which sets stand- mally stored in large databases or processed ards for internal controls implementing in central EDP centers, it is increasingly ha- the Federal Managers Financial Integrity ble to be at some point accessed, handled, Act and directs each agency to review and analyzed, or even generated using personal update its security provisions. computers or terminals scattered throughout The General Services Agency (GSA) and the agency headquarters and field offices. Most National Bureau of Standards (NBS) in 1983 of the concern about government security has began development of guidelines for security focused on large information systems. There in end-use computing and small office systems. has been much less attention to the protec- The Office of Personnel Management (O PM) tion of data in day-to-day agency operations recommends personnel security policies for in which decentralized office automation is computer-related jobs. However, the General used. Violations of security and confidential- Accounting Office (GAO) has repeatedly crit- ity need not be intentional or malicious; they icized the lack of compliance with guidelines are often the result of ignorance or careless- established in the circulars by Federal agen- ness. Office workers have not yet been accul- cies. 29 In 1982, GAO said that: turated to think routinely about computer security; there are stories of government work- . . . increasing Federal investments in auto- ers routinely locking away sensitive papers but mated systems . . . have resulted in growing vulnerability to fraudulent, wasteful, abusive, leaving the disks from which the copy was and illegal practices because greater concen- made lying next to their personal computer trations of information are accessible from re- or word processor. mote terminals. Government computers are thus subject to The Office of Management and Budget (OMB) the same risks that plague banks, corporate is now updating A-71, A-123, and other circu- payroll and financial management operations, lars related to computer security. It is expected and other private-sector computer systems, that they will be combined into one broad pol- plus some risks that are particularly political icy statement.30 in nature. As extreme examples, records could be destroyed to cripple a government program The Special Concern About or project; or calendars and trip schedules Employee Privacy could be used to plan the assassination of a political leader or a foreign dignitary.” An aspect of Federal computer security that - Implications of FederaI Go\crnment Information 7’echnoI- deserves–but has not received–special atten- o~;~’ for Ci\.il I.ihertie.s and Congressional O\ ”ersight, op. cit. —-.— .-. — ‘According to the Itrashington Post. an air traffic controller, -’U.S. General Accounting Office, Centra) Agwncies Con]- angry about the Soviet in~’asion of Afghanistan, deliberatel~ pliance 11>’th OJfE Circu]ar ,4-71, Transmittal Nlemorandum endangered an Aemflot jet carr~ing So\’iet ~\mbassador Dobr~- No. 1, I, CD-80-56- 1, Apr. 30. 1980: and Federal Information nin, b~’ manipulating a signal so that a computer read the jet S?’stems Remain High]j- I’ulnerah]e to Fraudulent, 11’asteful, as a small craft and did not properly monitor and control its .4 busi\e, and Illegal Practicesq NIASAD-82-18, Apr. 21, 1982, landing at a bus~ airport. (hlar~r Thornton, “Age of E~lectronic “ Susan \l. Nlenke, “Sur\re~ of Agencies Finds Nlan}’ Are C’on\enience Spawning In\entl\e Thie\res, ” The 11’ashin@on Implementing Standards, ” Special Section: Securit?’, (;olern- })o.~t, Yol. 107, hla~r 20, 1 984). ment Computer ,\”e\~’s, Yotrember 1984. tion is the question of the ability to protect, more dependent on microelectronics there is the privacy of Federal employees. Agencies the strong possibility-and given enough time collect and keep much personal data about em”. the virtual inevitability—of electrical failures ployees and even applicants for Federal jobs, that affect critical activities or whole regions Much more data is likely to be collected than of the country, bringing all computer-mediated would be sought by corporation personnel of- activity temporarily to a halt. Emergency re- fices.” These files may be, and usually are. sponse systems may be unable to respond ade- widely dispersed and only superficially pro- quately because some step or link depends on tected. As files are computerized, they can, office automation that is down because of the more easily be aggregated and accessed, or same emergency. Routine recovery procedures tampered with. If files are stored in personal may be hampered by loss of data in the same computers or can be accessed or downloaded, incident. GAO called attention to this danger more and more people will have access to them. in a strong report in 1981, identifying the need and may use them for satisfying curiosity, for for further emergency planning by the Depart- mischief, for exerting political pressure, or for ment of Energy and the Federal Emergency sheer malevolence. This raises significant ques- Management Administration.33 tions about protection of privacy in Federal Some government operations are highly time computer systems and databases. sensitive (e.g., transfer of funds, transmittal Federal employees are the subject of much of orders to the armed services, air traffic con- computer matching, which was described earl- trol, response to natural disasters, law enforce- ier; that is, the comparison of two or more ment actions). Others are dependent on ready computerized lists of individuals. For exam- access to individual and case records (tax col- ple, Federal employee lists were checked against lection, processing of welfare payments, pay- lists of people earlier defaulting on student rolls, etc.). As the government becomes more loans. A very early example of computer match- and more dependent on office automation for ing occurred during the Carter Administra- orderly performance of necessary activities, tion; this was Project Match, through which the result of any disruption-whether irrepara- names of Federal employees were matched ble or of brief duration and narrow scope– with names on the roll of the Aid to Families becomes more severe. with Dependent Children, in an effort to dis- 32 Federal agencies have not adequately pre- cover ineligible recipients. pared for natural or technological disasters that might wipe out electronic information, Accidental Losses according to GA0.34 Many still have no con- Telecommunications and computers are vul- tingency plans or rely on letters of agreement nerable to crime, mischief, and terrorism, but from other agencies to supply equipment in they are also vulnerable to unintended disrup- emergencies. This course assumes that the tion, a point that is sometimes overlooked. This other agency will: 1) be able and willing to live includes error or accident, and the simple up to its agreement even at the cost of prejudic- breakdown or failure of equipment; it also in- ing some of its own activities, and 2) will not —- —-. —... cludes destruction by fire, flood, earthquake, “U.S. General Accounting Office, Federal Electric Emer- and other natural and technological disasters. gency Preparedness IS Inadequate, EMI)-81-50, 1981. “U.S. General Accounting Office, Most Federal Agencies Data can also be lost permanently, or made Have Done Little Planning for ADPDisasters, AFMD-81-16, temporarily inaccessible, by electrical outages. 1980; and Federal Electrical Emergency Preparedness Is In- adequate, EMD-81-50, 1981. As government activities become more and A contingency plan should have most or all of the following features: backup files at external storage sites, standby arrange- “See Alan Westin, “Personnel Practices in the U.S. Civil ments for renting processing time or services, a recovery oper- Service, ” Information Age, July 1982, pp. 149-169. ation center, a multilateral aid agreement involving five or more ‘According to information supplied by Federal officials to agencies, or a plan for reverting to manual (nonelectronic) oper- OTA. ation if necessary. Ch. 6—Confidentiality and Security Issues With Office Automation ● 185 have been disrupted at the same time by the the Privacy Act over the last 10 years, includ- same events. Nonelectronic equipment is often ing annual reporting requirements; OMB guide- not available, and reversion to manual systems lines; agency implementation procedures; and not possible; data may exist only in electronic, continuing attention from congressional com- machine-readable form. mittees, media, interest groups, and scholars. The cost of downtime or time lost because However, if the government is ahead of the the computer is malfunctioning, is seldom cal- private sector, this says more about the lack culated in justifications or cost-benefit analy- of systematic attention to these issues within ses of office automation. In most cases, the corporations, than about the effectiveness of downtime is merely an annoyance and a tem- government attention. It does not mean that porary problem. In some cases, it significantly the problems have been taken care of. The par- aggravates the workload peaks and degrades ticular vulnerabilities of office automation sys- the quality and timeliness of important serv- tems to casual misuse, and even serious abuse ices. In time-sensitive situations, such as re- and fraud, are still not realized by most of the sponse to local emergencies, it can mean catas- users. trophe. But the openness of these small office automation systems, which makes them especially Comparisons With the Private Sector vulnerable, is probably also their best protec- In spite of these problems and concerns, the tion. The many users and the open office envi- Federal Government is probably well ahead ronment means that abuses are likely to be of the corporate sector in attention to the need observed and reported, if they are recognized for safeguarding privacy and security in the as abuses. They will be recognized only if of- use of microelectronic office automation.35 This fice workers understand the ethical, legal, and reflects the implementation of provisions of policy issues involved and are sensitive to their importance. A thorough attempt to educate Federal office workers about this problem is .— in order. ‘rThis is the conclusion from an OTA contracted study, F?-i- t’ac~’ and .9ecurit.v Issues in Office A utmnation, Alan F. \t’es- Individual workers, however, can do rela- tin and I,ance

POLICY CONSIDERATIONS Nearly a decade ago, the Senate Government last three Congresses related to computer secu- Operations Committee investigated computer rity in general and in particular to the secu- abuse in both the public and private sector; 36 rity of computerized government informa- as a result there have been proposals in the tion.37 In April 1984, the House Committee on Science and Technology issued a special ‘ L’. S, Congress, Senate Committee on (io\’ernment opera- report on Computer and Communications Se- tions, ~+ot~lerns Associated Il”ith (’omputer Technolog\’in fi’ed- eral l>rograms and I)ri\’ate Industr>’: (’omputer .4 buses, (~onl- mitt.ee Print, 94th Cong,, 2d sess., 1976; and Computer Securit} Federal Computer Systems Act of 1977, S. 1766 and Ii. R. in Federaf Programs, Committee l)rint, 9,5th (’ong., 1st sess., H421: S. 40 and Ii. R, 6196, 1979; Federal (’omputer S?rstems 1977. Protection Act of 1981, 11. R. 3’790. 186 Automation of America Offices -— — curity and Privacy38 that recommended that possible strategy is to have an ombudsman Congress charter a national commission to within each data-collecting organization. This study the issues and outline a framework for is the approach used, for example, in Germany. policy. While recognizing the threat from However, current laws may be adequate to “hackers and other outside intruders, ” the re- address the problems of decentralized auto- port said that the greatest threat is from per- mation. Whether organizations treat “office sonnel who are authorized users of the comp- automation” and centralized EDP as one or uter resources that they attack. The report separate and distinct components of office was highly critical of recent policy and pro- activity, the critical element is to adapt exist- grams related to computer security. ing rules to apply to predictable oversights, OTA concurs that violations of data con- carelessness, or misuse by some persons in the fidentiality are most likely to occur within the large end-user population, and to assign or- organization by authorized users. External ganizational responsibility and continuing over- threats, whether from hackers, ordinary thieves, sight duties to effective units at various levels political opportunists, disgruntled former em- of the organization. If organizations are not will- ployees, terrorists, or others, nevertheless de- ing or able to create and enforce policies to en- serve greater attention. But these threats sure that existing safeguards and guarantees chiefly concern large systems. With small com- are applied in end-use computing to protect their puters violations by insiders are most likely, clients and their employees, Congress may wish and there are fewer safeguards against them. to clarif y and strengthen through legislation the Both large systems and small computers are liabilities that such organizations incur by their at risk from accidental disruption because of failure. natural events, human error, and technologi- Current laws chiefly strengthen the right cal failure. and the ability of an individual to control in- Because decentralized end-user computing formation about himself or herself. Thus, the is raising new uncertainties about how well individual is the final enforcer of principles of data is protected, Congress may wish to re- fair information use. Given the ubiquitous na- examine the structure of privacy laws and thek ture of the new information technologies and application to these technologies, perhaps their linkages and systems integration, more through a special commission or task force. specific data collection and data protection policies may become necessary as opposed to Stringent actions have been suggested. One traditional policy approaches strengthening possibility is to establish a new authority to individual rights. implement, oversee, or enforce current and future statutes. This organization would have For Federal agencies, strong oversight at- no responsibility for collection and distribu- tention is merited to make sure that reason- tion of data. There are precedents for this: able security provisions are enforced. Special Sweden for example has a Data Commission attention should be given to the questions of: to oversee all records and their linkage. Another 1) the ability of essential day-to-day govern- —.— ment operations to continue when computers “U.S. Congress, House Committee on Science and Technol- cannot operate, 2) the need for protecting em- ogy, Computer and Communications Securit~r and Pri\’ac.y, re- ployee data, and 3) the adequacy of procedures port prepared by the Subcommittee on Transportation, A\’iii- tion and Materials, Committee Print, 98th Cong., 2d sess., April for protecting correspondence and records with 1984. congressional offices. Chapter 7 Home-Based Automated Office Work Contents

Page The Controversy Over Home-Based Office “Work...... 1$9 Historical Roots...... 191 The Status of Home-Based Office Work ...... 192 How Many Home-Based Office Workers .Are There? ...... 192 How Many May There Be in the Future? ...... 193 Mechanisms for Home-Based Work ..., ...... 194 What Work Can Be Done at Home? ...... 196 Parties at Interest ...... 197 Employers ...... 197 Productivity ...... ,, ...... 198 The Workers: Why Are They at Home?. 199 The Benefits and Costs for Home-Based workers?” : : : : : : : : : : : : : : : : : : : : : : : : : : : : 200 Family Considerations ...... 203 Effects on Society ...... 204 Legal and Regulatory Barriers to Home-Based Work ...... 205 Public Policy Issues ...... 206 Encouragement or Prohibition of Home-Based Office Work...., ...... 206 Regulation of Home-Based Office Work...... 208 Chapter 7 Home-Based Automated Office Workl

New information technologies allow the dis- information age will find millions of people persion of office work over time and space. As “telecommuting” from their “electronic cot- many functions of an office become internal tages, ” that is, using computers and telecom- to computers, and as computers are increas- munications to do office work in their homes. z ingly linked by communication networks, it At the present, there are only a few thousand becomes less necessary for office coworkers Americans for whom working at home is a full- to be located in the same room, or in the same time substitute for working in the office, but building. When a worker’s primary interaction the number is growing and many more might is with “the system” rather than with other be so employed by the mid-1990s. people, she can do her work wherever she can get access to the system–in the office, while -The word telecommuting was probably coined by Jack Nines, now at the University of Southern California, in the 19’70s traveling, or even at home. and reflected the interest at that time in working at home as a means of conserving automobile fuel and reducing urban air Some futurists have predicted that the avail- pollution. The term is not full~. appropriate for those who are ability of low-cost computing power and tele- hired (or contracted) specificzdl~ for home-based work and might not otherwise commute to an office to do the same work. In communications will increase the number of any case, o ‘telecommuting’ is an awkward back construction Americans working at home. The dawn of the since it means ‘‘commuting from afar’ rather than ‘‘working at a distance. Other terms often used are homework, remote Parts of this chapter draw on a contractor report prepared work, telework, or flexiplace. Blue Cross calls its home-based for OTA by Kathleen E. Christensen, New York University, workers, cottage keyers, or telenauts. The home as a computer- Impacts of Hmne-Based H-m-k on }1’mnen and Their Families, ized workplace is sometimes called an electronic cottage or an tJanuar~ 1985. electronic sweatshop.

THE CONTROVERSY OVER HOME-BASED OFFICE WORK The term “home-based office work” de- no matter how successful it becomes. In any scribes three very different phenomena. The case, these owner-managers seek work from first is the practice of working occasionally a number of clients and set their prices based or sporadically at home instead of at the of- on their perception of the value of their work fice, when it suits the purposes of the worker. and their competitive environment. These The primary work site is still the office, and home-based businesses provide a variety of the worker continues to be a fully participat- professional and clerical services from word ing member of the office staff while enjoying processing to accounting to computer pro- greater control over when and where, and un- gramming. This kind of home-based work is der what conditions the work is done. The oc- also, for the most part, noncontroversial. s casional home-based worker is most often a Finally, the residence can also be the prin- professional. This kind of home-based work cipal work site for workers who are employed is not controversial. by a single organization, but seldom or never In other cases the residence is the primary work in the central office. As employees, their work site. Some of these full-time home workers are entrepreneurs—people who have founded ‘Christensen found that women who developed word proc- small businesses with headquarters in their essing businesses in their home, seeking multiple clients rather homes. They may intend to move the business than tied to one corporate client, thought of themselves as, to separate quarters as soon as it can gener- and functioned as, professionals and businesswomen, in spite of the fact that the work they were doing would be called cleri- ate enough income to cover the overhead, or cal work if done in an office, and the women had in fact previ- they may choose to keep their business at home ously been clerical workers. Christensen, op. cit.

189 190 ● Automation of America Offices wages are usually set by the employer. Most the lack of certain social services deprives them home workers in this category are clerical of other options. workers, usually performing data entry or Home-based workers themselves are not word processing; in some cases however, the divided over the issue; they would be unwill- home may be the primary site for professional ing to give it up. Many have demanded the work such as computer programming. privilege or worked hard to persuade em- Most of the workers in this last category ployers to grant it. Some have accepted the are women. They may decide to work at home risks that go with free-lance employment in because they must combine work with other order to work at home. Some have made the responsibilities such as care of young children basic decision to stay at home while their chil- or elderly relatives. Some other full-time home dren are young, and regard the opportunity workers have physical disabilities or live far to do paid work at home as a pleasant bonus, from commercial centers. the icing on their cake. Others would much prefer to work away from home but have not Those who are enthusiasts for home-based been able to find any satisfactory alternative. work usually discuss it in terms of the first Their choice is to work at home, or to settle two images, the privileged worker and the en- for child care arrangements that they regard trepreneur. Those who oppose it are likely to) as unacceptable, or not work at all and become speak mostly of the last, the woman strug- dependent on others. gling to juggle two or more full-time responsibilities. Congressman Newt Gingrich of Georgia introduced a bill in the 97th and 98th Congresses There are three important variables here, (H.R. 2531, The Family Opportunity Act) that which relate to controversial positions on would have allowed a tax credit of 50 percent home-based office work. One is the extent to of the cost of computers bought primarily for which the home replaces a separate office as “nonrecreational use in the home. One pur- the primary work site. Another is the degree pose of the bill, which has not been rein- to which the home-based worker functions as troduced in this session, was to encourage a separate unit providing services to the orga- computer-mediated work at home.4 nization, rather than as an integral and participating member of the organization. The In contrast, the AFL-CIO has called for a third variable is the degree of choice exercised ban on computer-mediated home-based work. by the worker, either in choosing a job that The labor organization says that it is not pos- is home-based rather than office-based, or in sible to enforce health, wage and hour, and allocating his or her time between two lo- other worker protection measures in homes cations. without invasion of workers’ privacy. The unions are concerned that many home workers The controversy about home-based work can are paid under piece-rate systems and are only be understood in the context of other so- deprived of benefits packages. They also claim cial issues, including the long-range outlook that overhead costs are shifted from employer for employment, the feminization of poverty, to employee, and that the threat of sending labor-management relations, protection for workers, the adequacy of child care sytems, and opportunities for the handicapped and the ‘H. R. 2531 would amend the Internal Revenue code to al- elderly. If we had full employment and ample low an income tax credit for 50 percent of the expense of computers designed primarily for educational, professional, or other social services, home-based work would prob- nonrecreational use in the home. It would limit the amount ably not be controversial at all. The concern of such credit for a taxable year to $100 multiplied by the num- hinges on the question of whether, now or in ber of qualified members of the taxpayer’s family. The bill was referred to the House Committee on Ways and Means and was the future, some workers are forced to work not reported out. Computers used for work in the home are at home under undesirable conditions because tax deductible; the bill called for a tax credit. Ch. 7—Home-Based Automated Office Work 191 work out to be done at home could be used Home-based production work in a few in- to discourage office workers from demanding dustries, such as knitting of women’s outer- rights and benefits or from joining unions.5 wear, was banned in 1938.8 The Reagan Admin- The Service Employees International Union istration ended the prohibition on industrial (SEIU) also supports the call for a ban by refus- home knitting in November 1984.9 In addition, ing to enter into collective bargaining with em- a bill has been introduced in the Senate to ployers who use home workers, but is not com- amend the Fair Labor Standards Act to lift pletely opposed to home-based work if ways the ban on sewing, knitting, and other indus- can be found to regulate it. trial home work so long as the employer com- plies with minimum wage and maximum hour The implementation and enforcement of la- 10 laws. The controversy over the knitting ban bor standards in home-based work is probably began to focus attention on, and inflame, the the central policy issue in this discussion. emerging controversy over home-based auto- Those who call for a ban on home-based cleri- mated office work, which is, of course, not re- cal work argue that such enforcement would stricted. The AFL-CIO and others assert that be excessively costly or impossible, and that the conditions that brought about the ban in without it women (especially mothers), the the 1930s can recur, that home-based office elderly, new immigrants, and other disadvan- work can also be used in the future to exploit taged minorities may be exploited. Those who the unskilled, women, children, and immi- favor home-based work argue that protective regulation should not become a reason to de- grants. prive workers of benefits that are often sought In recent decades some kinds of office work after, such as the privilege of choosing where –for example, typing and envelope stuffing– they will do their work. have been done at piece-rates in the homes of ‘A 1930 publication of the U.S. Department of Labor pro- Historical Roots \’ides background on the prohibition: The industries that use the home-work s~rstem \rar}’ but Americans have a long tradition of working they are alike in using, to quicklj’ expand the labor force when a rush of work comes, the labor a;ailahl(~ in the home. Thus in the home to earn family income. Cottage the industries need not pro~ide factor}’ space and pay rent and industry did not entirely disappear with the other o~.w-head for this part of their production The burden of expansion and production is passed on to the home work- development of factories. It is thought that ers in the form of irregularity of emplo~’ment and earnings. In- about 10 million to 11 million Americans earn evitahIj’ questions arise as to the soundness and the social ethics of such a s}’stem of production. From the standpoint of the part of their income by working at home at public there is a clear case for regulation, If not the more drastic a wide variety of craft, production, and serv- measure of prohibition, to set limitsto the condit ion~ that this G highly competitive tjpe of production imposes upon a group ice occupations. This includes some farmers of workers who are, by’ L he nature of the case, in poor position (although their number has been steadily de- to protect themselves. I{ome workers are largely women, aided all too frequentl~ b> creasing) and many others who are only earn- children. They’ are chiefly unskilled or semiskillt,d (and I ing a little supplemental money at home, are recruited largely in tenement neighborhoods, often from recent immigrants or other groups with little or no indus[ rid ex- part of the underground economy, or for other perience. reasons are not counted in the labor force. The Emily C. Brown, Zndustria) Home Ilrork {M’ashington, DC: 1980 census counted about 1.2 million people U.S. Department of I,abor, Jf’omen’s Bureau, 1930). ‘Regulations, pt. 530: Employment of Home J4-orkers in in the labor force whose primary place of work Certain Industries. Title 29, pt. 530 of the Code of Federal Reg- was in their residence.7 ulations. U.S. Department of I,abor, Emplo~’ment Standards .— Administration, J$’age and Hour Di\ision. W’hite Iiouse Pub-

THE STATUS OF HOME-BASED OFFICE WORK How Many Home-Based Office of Labor Statistics’ projection. ]3 But many of Workers Are There? these estimates include those who only do cas- “’iHomebodies,” Forbes, September-October 1984, p. 10. Estimates of the number of home-based of- Joanne Tangorra, in an article, “Telecommuting,” Working fice workers using electronic equipment at Woman 7:1 1:52-54; quoted in Telecommuting, Advanced Sys- terns Laboratory, Wang Laboratories, Inc., educational brief, present range from 10,000 to 30,000. The most 1984, p. 6, says that the number of full-time home-based, com- frequently used estimate is 15,000, the Bureau puter-based workers is only 1,000. Ch. 7—Home-Based Automated Office Work ● 193 ual or “overflow” work.14 Probably there are Others project 5 million to 18 million home- only between 3,000 and 5,000 people who are based workers (up to 18 percent of the white- doing office work, using microelectronic equip- collar work force) using computers by 1990.20 ment, in their homes for outside employers or One estimate is that 50 percent of all white- clients, and most of these began only in the collar workers, or 26 million people, could do last 4 years. their work at home using computers.21 There are similar estimates in other industrialized While there was much discussion of “tele- nations. For example, one organization has commuting’ during the oil crisis there was lit- forecast that by 1990, 40 percent of people in tle or nothing in the literature discussing real 22 l5 Britain could be working at home. experience or examples. A survey in 1970 identified few home-based workers using com- All of these highly unlikely estimates (some puters. ” But some corporations had already of them even presented as projections, or at begun formal home-based work programs in least possibilities for the future) assume, ex- the United States and in other countries. There plicitly or implicitly, that some driving trends are now at least 40 such programs in the United will continue or that some existing constraints States. That could amount to only a few hun- will be eased. Factors most often mentioned dred people. But there may be at least 3,000 as encouraging the growth of home-based work home-based workers in zOO companies that less are lower equipment costs, the growth of elec- formally allow employees to choose to work tronic mail systems, improved technology for at home.17 This does not include many people linking the home and central office, rising en- who work at home as contractors or free-lance ergy costs, stable or decreasing communica- workers. tion costs, and renewed inflation (which tends to increase the demand for part-time workers How Many May There Be or an externalized work force). in the Future? Some long-range social and demographic trends seem to make it likely that more peo- Some enthusiasts, such as Alvin Tofiler say ple will be willing or eager to work in their that there could be as many as 15 million home- homes in the future, or will see it as their only based white-collar workers by 1990. ’8 This is way to earn a necessary income. Married wom- loosely based on the estimate that 15 million en increasingly want an independent income of today jobs could be moved to remote loca- 19 even when they choose the traditional role of tions. housewife; in the absence of alternative provisions for child care they may be forced to combine work with family duties. The same choice or lack of choice may face people who must care for elderly relatives. Large numbers of

‘Jack M. Nines, University of Southern California, “An “’See for example, Lad Kuzela, “Office Old-Fashioned?” lrJ- O\erview of Office Workstations in the Home, ” presented at dustry Week, Oct. 19, 1984, p. 71; and Sally Jacobs, “Working the National Executive Forum: Office l?’orkstations in the at Home Electronically, ’ New England Business, May 21, 1984, Home, National Academy of Sciences, J$’ashington, DC, Nov. p. 15, for summaries of recent forecasts and projections. In 10, 1983. the Kuzela article, Dr. Jack Nines of the University of South- ‘ Ibid., pp. 1-2. ern California is quoted as saying that under different sets of “Joanne H. Pratt, “Home Teleworking: A Study of Its Pi- conditions the number of telecommuters in California, by the oneers, ” Technological Forecasting and Social Change 25, 1-4, year 2000, could range from 300,000 to 8 million. 1984, p. 1. “R.C. Harkness, Technology Assessment of Telecommuni- -Patrick Honan, “Telecommuting, W’ill It J$’ork For You?” cations-Transportation Interactions, Stanford Research I nsti- Computer Decisions, June 15, 1984, p. 89. tute, Menlo Park, CA, 1977. “Quoted in 13reathnach, op. cit., and elsewhere. -Business Equipment Trends 1983/1 984, compiled by ‘An estimate by economist E;lisabeth Allison of Data Re- Kern/Ferry International for Beta Exhibitions I,td., quoted in sources, Inc., quoted by Judith Gregory, op. cit., p. 3, and Busi- B. C. 13urrows, “Information Technology-Its Impacts on Prop- ness 1$’eek, “If Home Is k$’here the N’orker Is, ” May 3, 1982, erty Development, I.ong Range Planning, vol. 17, No, 4, Au- p, 66, gust 1984. 194 ● Automation 0f America offices retired workers want or need a way to supple- There are other factors that may well retard ment retirement income on a part-time basis. the spread of home-based office work. Man- Handicapped people seek the self-reliance that agers and supervisors sometimes oppose it, comes from an earned income. Many people because it calls for entirely new techniques of simply like the idea of more flexibility in the supervision, instruction, and quality control. use of their time, or wish to live in rural areas Home-based workers frequently report that but are reluctant to spend large parts of the they are resented by coworkers who do not day commuting. have that privilege.27 Many work-at-home arrangements depend heavily on telephone lines; However, many observers are skeptical if there is a significant increase in local tele- about the likelihood that home-based work will phone rates, home-based work may be less at- expand greatly .23 The conventional office has s tractive to both employers and employees.’ proven to be a remarkably useful and stable 24 (In some cases, telephone costs are borne by institutional structure. It has four valuable the home worker.) characteristics that cannot be matched by home-based work: the presence and coopera- Finally, it is generally assumed that further tion of coworkers, its role in socializing the development of information and communica- worker to the corporation and its unique cul- tion technologies will tend to encourage home- ture, the prevalence of informal communica- based work. It is also possible however that tion networks, and mechanisms for structur- technological development may make some of ing the allocation of time. The office is also it superfluous. If the use of optical scanning a major focus of social and recreational activi- devices eliminates the need for much of today’s ties for many workers. mass data entry, a large portion of the work now done at home may be eliminated. The central office provides economies of scale in capital equipment acquisition, communication and cooperation of coworkers, access to Mechanisms for Home-Based Work central files and reference material, and the Work at home can be supported either by supporting superstructure of superior/subor- 25 an organization or by independent, free-lance dinate relationships. Some of these benefits activity. The worker, in other words, may be are lost or attenuated with dispersion of the an employee, or may be self-employed. work to other locations. If home-based work threatens to disrupt established corporate cul- A corporation may have a formal program ture, employers are likely to choose instead under which selected employees are offered the to increase productivity by further automa- option, or employees may request home-based tion within the office.26 work (often under the condition that a supervisor also has the option of refusing to agree to it). Other corporations informally allow in- . .——— .. —-. -’Margrethe Olson has surveyed corporations experiment- dividual workers to negotiate the privilege of ing with work-at-home programs in 1983-84 and concludes that working at home, either full time or more often ‘. . . . while there is continuing interest in the prospect, there part time. are no significant trends toward shifting large numbers into their homes either part or full time. ” (Margrethe H. Olson, New Most employed home-based workers have York University, “Working at Home and Telematics: Myths and Realities, ” a presentation at the Office Automation Con- previously worked for the same employer on- ference, Convention Center, Los Angeles, Feb. 20-22, 1984.) site. But some corporations have set up pro- -’Robert E. Kraut, Bell Communications Research, “Tele- grams to hire workers not otherwise available work: Cautious Pessimism, a presentation at the National Re- search Council’s National Executive Forum: Office Worksta- to them or able to work, e.g., handicapped tions in the Home, Washington, DC, Nov. 10, 1983, pp. 17-18. workers, mothers with small children, or subur- -’Steven S. Kawakami, Institute of Labor and Industrial ban housewives. Relations, University of Illinois, “Electronic Homework: Prob- lems and Prospects From a Human Resources Perspective, ” September 1983, p. 14, --Pratt, op. cit., p. 7; Jacobs, op. cit., p. 19. “Kraut, op. cit., p. 19. “Honan, op. cit., p. 96. Ch. 7—Home-Based Automated Office Work 195 .

Independent or self-employed home-based ical home-based workers are usually shifted workers may work under contract for one or to part-time status or independent contractor more organizations, or solicit piece work on status, and do not retain employee benefits. an ad hoc basis. Often corporations shift em- Most clerical workers who are first hired for ployees to self-employed contractor status home-based work are not given employee ben- when they become home-based workers. How- efits. 30 ever, if these workers contract with only one Whether workers are full or part time, they organization, they may in fact be employees may not do their work in the traditional office in the eyes of the law, depending on how pay hours of 9 to 5. The ability to control one’s rates are set, and other details of the arrange- 29 own work hours is often cited as a major bene- ment . 31 fit of working at home. But the choice of work Professionals are often operating as consul- hours in practice is usually constrained. The tants, one-person firms, or part of very small workers sometimes find that they must work businesses. Those who are employees, however, during the business hours of employers or typically retain salary and benefits, whereas cler- clients in order to ask questions or receive instructions. More often, they must fit their work ‘A recent IRS ruling indicates that they are employees, at around family responsibilities, working dur- least for some purposes. See p. 38 below. There have also been cases under the National I.abor Relations Board : rider which ing school hours, when another adult is at home newspaper delivery truck drit’ers, for example, were held to to care for children, or when the children are he employees rather than independent contractors as a com- asleep. It is common for them to work at night, pany, had claimed, according to Dennis Chamot, Associate IJi- often after a full day of child care, cooking, rector of the A FI.-C 10 Department for Professional l~mplo~- 32 ees (personal communication, ,Jan. 8, 1985). cleaning, and shopping. Some workers use dumb terminals connected to an employer’s mainframe computer, usually by a ordinary telephone line and modem. An additional telephone line is often installed

‘‘T!argrethe Olson studied work-at-home programs in 14 corporations in 1983. I n eight programs the workers were permanent full-time employees (salaries plus benefits). All of t,hese programs except one involved professional workers. The other six programs were for clerical workers. I n four programs, the~’ were permanent part-time workers earning hourl? wages. one of these companies paid the workers no benefits, three prorated benefits. One program paid the part-time worker-s bj output (piece rate) with no benefits. The sixth program used contract workers. paid hourly rates, but with no separate benefits package. Margrethe H. Olson, (h’er~’iew of 14’ork-at-Home Trends in the United States, New York University, Graduate School of Business Administration, Center for Research on 1 nfornla- tion Systems (New York: New York Uni\rersit~, August 1983). p. 9. The literature suggests that the disparity in arrangements for professional compared to clerical Workers show’n in olson’s data is probably typical of corporate pro~rams. “Olson found that about half of the workers in her stud~r did, howet’er, approximate a 9-to-5 schedule. The others tended to work early mornings or late evenings, but on a fairll’ regular schedule. These were most often professionals, working at home under informal arrangements rather than formal programs. Those in formal programs. i.e., clerical workers, who worked odd hours usually did so because of the need to work around fanlill constraints. Olson, op. cit., p. 22. ‘ Kathleen l+;. Christensen, “ Impacts of IIome-Based \t’ork A portable terminal can be connected via telephone on J$’omen and Their Families, contractor report for OTA, lines to business computer systems Januar~ 1985. in the home for this purpose. Sometimes a dedi try and word processing can be monitored and cated leased line is necessary for security. measured electronically, computer checked for Other workers use personal computers or stand- errors, and paid as piecework. Raw data and alone word processors, dictating machines and finished work can be physically transported printers. 33 between office and home in batches, or can be sent by telephone. Whether professional or There have been problems with equipment clerical, this work usually does not require in some programs, but by most accounts tech- 34 much face-to-face supervision or collaborative nological problems have been minimal. The effort between coworkers in real time. equipment may be owned and installed by the employer, and either lent or rented to the Supervisors are least likely to be able to work worker. The worker may own or lease her own at home and there are now only a few firms equipment .35 Blue Cross clerical workers in where they do so. This may change in the fu- North Carolina, for example, pay their em- ture with the spread of electronic mail, com- ployer $2,400 yearly rental for use of their puter conferencing, PBX, and other electronic equipment. 36 On the other hand, an employer tools that make possible cooperative document- in the Netherlands pays home workers an ex- handling and reduce the need for frequent intra 2,000 guilders per month to cover the costs teractions with coworkers.39 However, the ex- of operating a terminal at home.37 tent to which supervisors will be inclined and willing to replace face-to-face interaction and What Work Can Be Done at Home? supervision with electronic communication remains to be seen. One of the most likely kinds of office work Financial and computer service corporations to be done at home is professional work that involves only one person’s creative activity have been most likely to experiment with work- (programming, writing reports) or contacts at-home programs. Metropolitan Life, Control usually carried out by telephone (sales, broker- Data Corporation, National Bank of Chicago, ing). A second kind is clerical activities that Continental Illinois, Southern New England are unitized, repetitive, and routine.38 Data en- Telephone, Seybold, and Aetna Life and Cas- ualty Company have started such programs, although some of these have been terminated “In Pratt’s recent study of 59 home-based office workers, or suspended.40 Small new companies have also 57 percent of the equipment was employer-owned terminals communicating with mainframe computers in the office; 31 per- experimented with the scheme. Few or none cent was stand-alone computers; and 12 percent was stand- of the programs have been found in old, tradi- alone word processors usually not equipped for communica- tional industries. tion. Pratt, op. cit., p. 5. “However, according to Elizabeth Carlson, second vice There is strong interest in work at home in president of personnel, as quoted by Honan, op. cit., p. 96, Con- tinental Illinois curtailed its program in 1980 and again in 1981, other countries, but the movement has been “waiting for vendors to come out with usable equipment. ” strongest in the United States. In England, ‘“In most of the formal corporate programs that Olson early enthusiastic projections of “electronic studied, the employer paid for installation of equipment and monthly telephone charges; in one program employees rented commuting” were not met, largely because of equipment from the company. Olson, op. cit., August 1983, p. 10. the high costs of telephone lines.41 In France, ““If Home Is Where the Worker 1s, ” Business Week, May there have been a number of experiments with 3, 1982, p. 66. “Richard J. Long, “The Application of Microelectronics to working long distance from small neighbor- the Office: Organizational and Human Implications, ” Nigel hood centers rather than homes. The national Percy (cd.), The Arrnagement Implications of New Informa- tion Technology (London: Croom Helm, 1984), p. 106. telecommunications authority, which spon- ‘“In one study of corporate pilot programs, it was found sored these programs, made an explicit policy that they had targeted either clerical workers, with the objec- —— . — . tive of cutting overhead costs, or professional workers, in the “Olson, op. cit., August 1983, p. 7. . interest of retaining valued workers who demanded the privi- 4“Honan, op. cit.; Jacobs, op. cit.; Wang Laboratories, op. lege of working at home. These were distinct objectives and cit. quite different kinds of pilot programs; no corporations had “Ursula Huws, The New Home Workers (London: I.ow both types. Olson, op. cit., 1983, p. 7. Pay Unit, pamphlet No. 28, 1984), pp. 14-15. —

Ch. 7—Home-Based Automated Office Work . 197 decision that home-based work would be too Holland, and the United States, is deliberately isolating. These experiments have generally structured so that nearly all of its workers are not been successful and most of the workers based at home. These are computer profes- dropped out. ” However some pilot programs sionals, and in Europe, 96 percent of them are for handicapped workers are now underway. women with small children, and 95 percent Sweden has also experimented with neighbor- work entirely at home. In the United States, hood work centers, and there is reported to 70 percent of the company’s employees are be much interest, but little experience, with women, and 50 percent are fully home-based. working at home.43 44 The workers agree at the outset, they will steadily increase both their working hours and One multinational software company based commitment to the company and career, as in Britain, with subsidiary offices in Denmark, 45 their children mature. ‘lt)id., p. 19. “Ibid. “lklonica I+jlling, Swedish Center for W’orking Life, Stock- holm, “Remote J1’ork Telecommuting, ” presentation at IF IP- . ——— Conference on “}f’omen, 11’ork, and Computerization, ’ Ri\’a ‘ Huws, op. cit.: and Nlarsha Johnston Fisher, “Firm Turns del Sole, ltal~’, Sept. 17-21, 1984. Telecommuting Into a Realit~’, ” AlIS, No\’. 28, 1984.

PARTIES AT INTEREST Employers The strongest motivation for offering home- based work in the future is, however, likely Employers who offer home-based work have to be the possibility of reducing costs. The em- at least one of four possible objectives: re- ployer saves money in terms of: sponse to employee demands, social responsibility, access to an untapped labor pool, or cost ● floor space and associated overhead costs, cutting. The last is apt to be the critical factor ● equipment costs (in some situations), for the future spread of home-based work. direct labor costs, and workers’ benefits. Some corporations have begun home-based work programs, or allowed the option in indi- The office needs proportionately smaller fa- vidual cases, to hold on to particularly valued cilities, with all of the reduced operating costs workers. Some allow workers on retirement that entails, if many of the workers are at to continue part-time work from their homes. home. There workers pay for their own floor Others such as Control Data Corporation and space, heating, cooling, and amenities; in some Metropolitan Life began programs in order to cases, they own and maintain the computer offer employment to handicapped workers.46 and other equipment. In effect, these costs are shifted to the workers. A few corporations are reported to be turning to home-based work as a way of recruiting If the workers use terminals to communi- otherwise unavailable but highly qualified work- cate with the employer’s central computer, the ers, such as mothers of small children, or subur- employer benefits by the more intensive use ban housewives.47 Critics say that they are of the computer because workers often use it, trying to avoid hiring poorly educated urban and can even be required to use it, outside of minority workers. peak hours. For example, in a pilot program run by the Army Materiel Development and Readiness Command, there was a 64 percent increase in computer usage without additional cost. Three homebased employees were shifted “ Ilonan, op. cit., pp. 88-91. to second and third shifts. The percentage of ‘-Pratt, op. cit. work time that the remote employees spent 198 ● Automation of America Offices — on-line also increased by an average of 93 per- studied by OTA for this project did not recent.48 ceive any employee benefits. Entrepreneurs had purchased their own health insurance and Home-based clerical employees are often 52 retirement plans. paid less than their peers in the office, although this is not always the case.49 If the workers It has also been suggested that union- are paid piece-rates, the employer is not pay- busting is, or will be, a motivation for some ing for set-up time, time spent in collecting employers. At present, few office workers be- or delivering work, coffee breaks, bathroom long to unions, and home-based workers are breaks, discussions with supervisors, chats likely to be even more difficult to organize than with coworkers, or any of the other unproduc- other office workers. The low pay for home- tive time that office work includes. The orga- based clerical workers, especially piece-rates, nization can define the work by task and pay could act over the long run to depress the pay only when it is satisfactorily completed. of the main clerical work force. Critics argue that employers might use the threat of ex- The employer’s biggest cost saving may panded homework programs to undermine at- come from flexibility-workers can be used tempts by office workers to organize. when needed and not used when work is slow, without the difficulties of firing and rehiring In spite of seemingly significant benefits to or the expense of unemployment compensa- the employer, many companies resist the con- tion. This-is a great advantage for a company cept of work at home. It involves a significant with a highly uneven workload. It means, how- change in traditional techniques of manage- ever, that the worker does not have a steady ment and supervision, and managers fear a income .50 loss of control over quality, quantity, and pacing of the product. The workers themselves Many homebased workers received no bene- sometimes complain of poor instruction and fits—health insurance, sick leave, vacations, 53 a lack of feedback from managers. pensions, etc. Of 14 corporate programs studied in 1983, for example, the 6 designed for clerical workers shifted their status from full- Productivity time to permanent part-time workers, in which 5 Almost without exception, studies show that category workers-did not receive benefits. home-based workers are more productive than Those classified as independent contractors those in the office. Estimates of the increased are generally not eligible for unemployment productivity of home-based workers range from insurance benefits when not working. Home” Control Data Corporation’s estimate of 15 to based employees and independent contractors 25 percent to other estimates of up to 60 per- cent54 and even 80 percent55 for some work- “Mary T. McDavid, “The ALMSA Work-at-IIome Proto type, ” presented at the National Executive Forum: Office Work. stations in the Home, .National Academy of Sciences, Wash- ——--_——— ington, DC, Nov. 10, 1983. “Christensen, op. cit. Most of the home-based workers ‘qContinental Illinois, for example, paid at-home workers studied in depth were, except for those who were active en- the same salaries paid to in-office workers, expecting that cost- trepreneurs who owned their own business, regarded by their reduction would result from reduced need for office space. Ho- companies as independent contractors. Since they each worked nan, op. cit., p. 96. only for one company, in most cases had been regular employ- “’’Business Week reported in 1982, for example, that “Aet- ees until they took maternity leave, and had been approached na plans to pay telecommuters by the project and to use them on the question of working at home in each case by the com- only for ‘peak work, ’ leaving them without a regular salary. pany rather than themselves soliciting home-based work, they They will also be ineligible for health and pension benefits. ” probably should still be regarded as employees. Blue Cross home-based data enterers are excluded from bene- ‘ ‘Pratt, op. cit., p. 6. fits, which for office-based workers amount to $2,000 to $3,000. “’R.A. Manning, Control Data Corp., “Alternative Work The company says that those at home earn “up to $3,oOO a Site Programs, ” a presentation to the National Research Coun- year more, ” but they also pay $2,400 rent for their terminals. cil’s National Executive Forum: Office Work Stations in the “If Home Is Where the Worker Is, ” Business Week, May 2, Home, Washington, DC, November 1983. 1982, p. 66. ““In a study of about 1,000 home-based workers by Elec- “’Olson, op. cit., August 1983, p. 11. tronic Services Unlimited, reported in Jacobs, op. cit., p. 15. Ch. 7—Home-Based Automated Office Work ● 199 . —. ers.56 In part, this is an artifact of measure- the novelty of working at home is gone, and ment. With home-based workers, only actual when less highly motivated or selected work- working minutes are counted. In the office, ers are involved. The cross-fertilization and there is a considerable amount of “wasted mutual support that occurs in an office work- time” that is so fragmented that it is not no- ing group are valuable. Workers learn from ticed. However, many experts believe that each other on the job. When there is no chance much of this “wasted” time is in fact spent to do this, productivity y may suffer in the long in informal help and support to other work- run. ers, or in the exercise of “invisible skills’ beneficial to the company .57 The Workers: Why Are They at Home? Home-based workers who were interviewed for OTA said that they did not bill their em- Because the number of home-based work- ployers for extra work they did in correcting ers is uncertain, their characteristics-age, mistakes. Some did not request payment for, gender, occupational status, etc.—cannot be or even report, hours that they put in on a described quantitatively with confidence. Cer- project over and above the time that had been tain groups are thought to be represented far estimated as required, feeling that they should out of proportion to their number in the total have been able to work faster–even though work force—women, single parents, the hand- these estimates of required time had been made icapped, and retirees. 59 by the employer rather than by themselves. This kind of self-exploitation maybe common Professional home-based workers include among those for whom home-based work is both men and women; the clerical workers are new and regarded as a rare privilege, and overwhelmingly women, and the evidence indicates that most have one or more children should be taken into account in assessing the 60 reports of high productivity .5* under 6 years old. This is true in other countries as well as in the United States. The typi- Workers themselves tend to attribute the cal home-based white-collar worker, then, is increased productivity to their control over probably not a male professional, but a young their schedule, their ability to work when they mother doing clerical work.61 most feel like working. In part, the additional productivity probably results from the fact Most of the home-based clerical workers are that home-based workers are carefully selected, women because: 1) most clerical workers are highly motivated, and working in an environ- women, and 2) women are most likely to be responsible for care of children, the elderly, ment chosen and designed by themselves. — ‘“An analysis based on the 1980 census suggests that of Some observers argue that all of these ef- people regularly working at home (but not necessaril~’ doing fects are transitory and will disappear when office work or using computers), 57 percent were women compared to 43 percent of those working outside the home. (Robert ‘ hlc~at’~d, op. cit. Nines concludes that gains of 20 to 50 E, Kraut, in on-going analysis, communication of Dec. 20. 1984.) percent are common. (,Nilles, op. cit., p, 3.) In one group, 6’7 ‘“ Among those who volunteered to be interviewed b)’ 0’rA percent of the workers perceived their own productivity, as contractor Kathleen Christensen there were two groups, roughl~. well as the qualit,y of their work, to have significantly increased. equal in size. Those who were in effect employees (although (Pratt, op. cit., p. 5.) In another study, workers reported their called independent contractors they worked only for one orga- perceived increase in producti~’ity to be 35 percent on the aver- nization, usually their employer before they took maternit~’ age, with the self-reported range from 5 to 100 percent. leave) were all women in their thirties, married or with part- In;risible skills are important aspec~s of the job that are ners, and with small children. Those who were entrepreneurs. not specified in job descriptions but make the worker traluable with their own companies and seeking multiple clients, were to an organization: for example, a secretar~’ chatting hospita- typicall~’ older, single, with no small children. An as-~’ et- bly with important \risitors, or a word processor showing co- unpublished survey of se~’eral hundred home-based workers con- workers features of the equipment that they have not yet dis- firms this finding. co~’ered, ‘‘Nlost home-based women workers with children under 17 ‘Christensen notes that this response was typical for the are clerical workers, according to a major sur}’ey: Kathleen h;. emploj’ed home workers, but that it was not typical for en- Christensen, “National Survey on 14’ornen and Home-Based trepreneurs who had clear ideas about the \’alue of their time 1$’ork ” F’amilJF C’ircle, Dec. 15, 1984 (publication of results in and priced services to be competiti>’e with similar businesses, progress). 200 Automation of America’s Offices ——.—— or the ill.62 Women are probably also most like- Many of these professionals believe however ly to need additional income after retirement, that home-based work, especially if done full because they live longer than men, and are less time or nearly full time, seriously prejudices likely to have adequate pensions. their chance of promotion and advancement. They have consciously traded-off advancement Most if not all home-based workers are now for a preferred lifestyle.64 Women managers working at home by choice, in the sense that especially tend to believe that this choice is other jobs are available and no employers are particularly prejudicial to their careers; some known to require working at home as a condi- have done it in preference to dropping out en- tion of employment. In most cases, the demand tirely when they became mothers, and in or- for home-based work has so far come from the der to maintain their expertise and credentials workers, not from employers, who are often 65 until they could return to work. reluctant or at least hesitant to provide this option. But this may already be changing, as Those who look for home-based work reluc- organizations become aware of the cost-saving tantly, because they must beat home, are more possibilities. 63 likely to be clerical workers.66 They are less likely than professionals to be able to afford “Choice” in any case has a wide range of professional child care or specialized transpor- meanings. In some cases, it means that other tation for the handicapped. But even for these options are not available, or are less attrac- people, the opportunity to work at home may tive to a worker for reasons over which she be cherished, in contrast to not working, or has little control—staying at home is neces- working under less desirable conditions. sary because of other responsibilities, because of social inhibitions (the traditional housewife’s It is therefore not surprising that overwhelm- role), or because of physical disability. Often, ingly home-based workers are pleased with however, the person has first decided that he their situation. This must be kept in mind when she wants to stay at home and care for a fam- evaluating the implications of home-based of- ily; the opportunity to do paid work at home fice work. Controversy over home-based work is a secondary choice that is not a critical fac- does not arise from the dissatisfaction of the tor in the first decision. Other people simply current home-based workers themselves, but prefer a lifestyle that does not include going from the possibility of future exploitation. to an office, at least not at any preset times. These people who have actively sought The Benefits and Costs for home-based work as part of a new lifestyle are Home-Based Workers? more likely to be the professionals (including How workers assess the relative benefits and males) simply because professionals usually costs to them of working at home undoubtedly can exert more control over the conditions depends on the degree to which they exercised under which they earn a living. Corporations free choice from a wide range of employment frequently report that they have formally or options. informally provided the option in order to retain valued employees. All studies, and all journalistic accounts of —.—— home-based workers, indicate that most value “’While women constitute 80.5 percent of all clerical workers, they are even more dominant in clerical occupations most the opportunity to control their own work likely to include home-based work. For example, over 96 per- hours. Many report that the quality of their cent of typists are women, but less than 23 percent of shipping leisure time is also improved because they can clerks. Kraut, op. cit., p. 5. “’The group of 13 “independent contractors” who worked select and schedule recreational activities that only for one client included nine former employees of an insurance company, who had been offered work to be done at home “Pratt, op. cit., p. 7. See also Breathnach, Honan, Jacobs, when they applied for maternity leave. Four others were house- Olson, op. cit. wives who had each been asked to do work at home by friends ‘“’Pratt, op. cit., p. 11. Also substantiated in Christensen, or husbands who were the proprietors of small companies. op. cit. Christensen, op. cit. “For example, see Olson, op. cit., August 1983, p. 17. .—

Ch. 7—Home-Based Automated Office Work ● 201 are not otherwise available. Many of them find city bills because of the equipment, and some the home a congenial and comfortable work- report additional heating- and cooling bills.69 ing environment; this is not always the case Clerical home workers almost always earn for those who are combining work with child less than their peers in the office, even within care in crowded living quarters. Many value the same firm.’” Sometimes the pay rate is tech- highly, the additional time spent with their nically the same, but those at home are shifted families, or the latitude to spend more day- to part time or piece rates without fringe ben- time hours with family. The opportunity to efits. They usually work fewer hours than those care for children at home rather than have in offices, either because work is not regularly them cared for by others is the primary bene- available, because of their home-related duties, fit for many people. or by choice. It is not always true, however, that work- Part-time and piece-rate home-based working at home allows the worker to control when ers usually report that their workload is very he or she works. The home-based worker in- uneven.” (For employers, the flexibility of la- deed often has a double constraint, having to bor supply is a major benefit.) The lack of a fit work around family needs and the times regular income can be as much of a problem when the company computer is down, such as as is low pay; those who are dependent on in- on Sundays. Thus, they may have as little con- come from home-based work may live balanced trol as office workers over when they work, on the edge of financial disaster. and they may even lose some of what is usually considered family time. Health insurance coverage becomes a major problem for those converted to the status Cost savings can be significant for some who of independent contractor or part-time worker. give up work in an office. Workers have re- The majority of home-based workers may be ported savings up to $200 per month for meals, covered as dependents by the health insurance $100 for gasoline, parking, and insurance; $100 of spouses, but the separation from employee for clothes and cleaning bills. Large costs of 67 status leaves others to pay the high costs of children’s day care may be avoided. Those individual coverage or be without protection .72 who are entrepreneurs avoid the cost of outside office space and take tax deductions for “4Pratt, op. cit.; and Honan, op. cit., p. 97. the use of their home. “See for example, Olson, op. cit., August 1983. Other case studies of home-based clerical work have consistentl.v found Eliminating the commute to work is for that home-based workers make less than peers. However, some preliminary analysis by Robert Kraut at Bell Communications many a primary benefit. The average Amer- Research, shows higher hourl~’ wages for home-based workers ican worker now travels over 9 miles in each in a few clerical categories as compared to those not working direction, often a 1- to ‘2-hour commute.68 The at home. time and the stress spent in commuting is often Reduced income is typical of the larger category of all work at home as compared to work away from the home. According resented even more than the cost of gasoline, to the 1980 census, 10 percent of home-based workers are be- insurance, car maintenance, and parking. low the poverty line, compared to 6 percent of other workers. Male home-based workers have an average hourly wage of $6.77 These cost savings of working at home do compared to $8.20 for nonhome workers; women home-based not tell the whole story. There are also added workers have an hourly wage of $3.06 compared to $4.80 outside the home. In addition, home-based women workers a\’er- costs, both direct and indirect. Some workers age 30.6 hours work per week compared to 40.2 for those work- must lease or buy terminals. Most pay the tele- ing away from home, 35 for male home-based workers, and 41.6 phone bills and some must pay for special dedi- for other male workers. There may be several variables invol~ed cated telephone lines. Workers generally pro- in this phenomena. Pratt (op. cit. ) also reported that many retired people found vide the furniture that they use in connection home-based work not worth their effort because of the low pa~, with the equipment. They pay higher electri- even though many enjoyed ha~’ing some work to occup~. their time. ‘ Pratt, op. cit., p. 5. “ Pratt, op. cit., p. 10. ‘‘hlotor }’ehicles hlanufacturers Association, Facts and “-Among those interviewed b>’ Christensen, independent Figures, Detroit, hl I, 1981. contractors working for one client were cotrered under a hus- 202 Automation of America Offices — . —

While home-based workers have more con- affiliation and emotional contentment within trol over their working environment than they the family and community, which will become would in most offices, in the sense that the more important to the worker than his or her decisions are their own, in fact, they often work organization. If these needs for “belonging- under very undesirable conditions. It may not ness cannot be met within the immediate be possible to set aside space dedicated only environment, then frustration and dissatisfac- to work. They may not know how to select, tion will result.75 or perhaps cannot afford to buy, chairs and Home-based professionals whose salaries do desks that accommodate the equipment and 73 not depend on the exact number of hours reduce muscular strain for the workers. Poor worked have remarked that minor illnesses, lighting may cause eyestrain and headaches. for which they would have stayed home from It is possible that office automation equipment the office, now make them feel guilty-there also introduces unrecognized hazards into the 74 is no ritual process of calling in to validate home. their reason for not working. One intangible cost to the worker may be Distractions and interruptions by family the social isolation of working at home. Salo- members, normal household noise, salesmen man and Saloman point to the importance of and solicitors, friends who do not respect work- social interaction at work, and studies that ing hours at home and repeatedly call or visit, have shown that small, cohesive work groups are sources of annoyance and stress for home- are for most workers the most effective and 76 based workers. Some people have reported satisfying work unit. For these workers, sep- giving up work at home because they could aration from the office work group may in the not resist the temptation to eat or drink too long run result in dissatisfaction and low moti- much. Men have reported that wives resented vation. For managers and professionals, the 77 having them under foot all of the time. social role of the workplace may be less important; they rank achievement, advancement, On the other side, some researchers have re- and the work itself as the most important fac- ported that both the loners and the gregari- tors in work satisfaction. The Salomans hy- ous types say that they can overcome these pothesize that for some of these workers, the problems with time. Handicapped people re- shift to working at home may cause the indi- port that they feel less isolated with work to vidual’s “motivators” to shift. He or she may do, even if their human contacts do not in- become less concerned with achievement, sta- crease, and young mothers according to one tus, and recognition, and more concerned with survey said they were no more isolated than .— they would be if they were caring for children band’s health insurance. Those who were entrepreneurs with, without paid office work to do. It appears to or seeking, multiple clients were mostly not married; they said be the young, never married workers who are that the high cost of health insurance (in one case, $1,400 per most likely to give up home-based work after year) was one of their greatest concerns, and one or two had gone uncovered for long periods of time. Christensen, op. cit. they have tried it because they miss the social “K1’e]ecornmuting Review, Dec. 31, 1984, cited a survey of aspects of the office.78 computing furniture needs conducted by the Business Prod- ucts Consulting Group, which found that only 25 percent of --.— .- personal computer users, whether in the home or in the office, ‘‘Ilan Saloman and Meera Saloman, “Telecommunicating: had specialized computer furniture, and many of them com- The Employee’s Perspective, ” Technological Forecasting and plained of flaws in design that caused discomfort. Overall 7 Social Change 25, 15-28, 1984. The Salomans here are drawing out of 10 PC users had complaints about the furniture used on the work of N.D, Dunnette and others in Work and Non- with the computers. The situation is likely to be worse in homes work in the Year 2000, Dunnette (cd. ) (Californiiz Brooks/Cole, than in offices, since home furniture is often jerry-rigged to 1973). hold office equipment. “’Saloman and Saloman, op. cit., pp. 23-24. “If fire breaks out, there is a serious hazard to residents “Nelson B. Phelps, “Mountain Bell Telephone Company, a and to fire fighters from the highly toxic gases produced when Case Study, ” a presentation to the National Research Council the plastic casing of computers burns. Any special cabling that National Executive Forum: Office Work Stations in the Home, might be installed in homes could also involve fire hazards, Washington, DC, September 1983. according to discussions with insurance risk assessors. “Pratt, op. cit. Ch. 7—Home-Based Automated Office Work ● 203

Again, those who found home-based work at home cannot be called a ‘good’ solution to unpleasant or stressful, have so far either had child care. “81 the option of returning to the office or have Mothers working at home typically try to found this alternative even less acceptable. work when other adults are at home to care Thus, studies of home-based workers almost for the children or when the children are at always find the workers enthusiastic about this school or asleep; they are not so much com- lifestyle. bining work and child care as interweaving them.” It is hard to find 40 such hours a week Family Considerations even when work is available and the income Advocates of home-based work stress the is wanted, and typically they work split shifts, benefits to family life of returning the worker often late at night. Those who must earn as to the home. Little research has been done to much as possible because they and their chil- determine the real effects on family life. Such dren are dependent on their income, may there- indicators as there are point to generally posi- fore have little or no time for rest or recrea- tive effects, but with some caveats .79 Mothers tion, like the cottage sweatshop workers of the perceive several specific advantages for their turn of the century. children, in addition to the primary advantage Those who regard this income as discretion- of having a parent care for them, instead of ary often have babysitters while they are work- strangers or a commercial facility. They being.” Since taking care of the children them- lieve it is good for their children to realize that selves is important to these women, the fact “mothers can do more than cook . . . and take that they turn to baby sitters indicates two care of them. They want their children to see things: that doing paid work and taking care women performing a broader social role than of children at the same time is difficult and that of housewife, however they themselves stressful; and that it is important to them to value that role. Some say that their children have some other work, in addition to caring become more independent because they are not for a family, for reasons other than the mar- the only focus of mother’s attention. They say ginal income. The second point is repeatedly also that their children become familiar with confirmed by home-based working mothers, computers and what they can do. who say that they need something to occupy On the other hand, some mothers report that their minds or that paid work gives them pride their children get less time and attention, and that the mother gets impatient when she is —. under pressure to get work done. ogy, 1984. In one study, 50 percent of mothers working at home reported that the-y found it necessary to have a paid bab~’sit ter For women struggling to earn an income and for part of the time in spite of their desire to combine work care for children at the same time, home-based and child care. Also Margrethe olson, Remote Office l! ”ork: Implications for lndi~’iduals and (~rganizations, CAIS No. 25. work may be a golden opportunity, but it is GBA No. 81-86 (CR), New York Uni\rersit~, (lraduate School not an unalloyed blessing. It involves signifi- of Business Administration (New York: New’ York Uni\’ersit~’), cant stress, both physical and mental, and may “’Olson, op. cit., August 1983, p. 27. ‘-The 14 mothers inter~iewed by Kathleen Christensen, create emotional strains within the family as nearly all said the hours the~’ could work were those in which well. so One expert says, ‘‘It appears that work the children were asleep, in school, being watched by the hus- band, or “playing bv themselves and or in a good mood. ” These ‘Ma~erial in this section, unless otherwise noted, is drawn women are in ~radit-ional t we-parent households where the hus- from Kathleen Christensen’s study and chiefl~’ from the re- band is the primary breadwinner. sponses of 14 mothers working at home, so that it is merely “Six of the 14 mothers interviewed by Kathleen Christen- illustratii’e. Iler findings as discussed in this section are, how- sen, all of whom were from traditional two parent households ever-, in man~~ cases confirmed by or congruent with the some- and said that the~. stayed at home to care for their children, what scant~’ and widel~ dispersed observations of other research- relied on some form of paid child care while they worked. The ers about the family situation of home-based workers. mothers, whether or not they had child care, usually ga~e as ‘ ‘Gregory, op. cit. discussing Cynthia Costello, “On the their reason for working “to ha~’e something to do, so that m~’ Front: Class, (jender, and Conflict in the Insurance Workplace, mind can keep working, or to show ‘ a ~hat I can do something Ph. D, dissertation, University of J4risconsin, Dept. of Sociol- besides cleaning the house and being a house~’ife. 204 ● Automation of America’s Offices and self-respect (and respect from others) that in a given social position.86 Role conflicts can is lacking otherwise.84 result when the demands and expectations imposed by multiple roles operate at the same In the few cases where effects on the mar- time. Working at home, the Salomans argue, riage, or other personal relationships, of home- can introduce identity conflict as it eliminates based women workers have been studied, most the sequential operation of the different roles husbands were said by their working wives related to home and work. For men, it has nor- to be supportive and helpful—sometimes be- mally been “acceptable for work (to) interfere cause they welcomed the supplemental fam- with family life”; at home, the reverse inter- ily income, sometimes because they recognized ference may happen more often. For women, its psychological importance to the worker, who may have more social inhibitions to over- sometimes for both reasons. A few husbands come in establishing a career role, the conflict were said to have mixed feelings, perceiving may be particularly severe when the roles of that work sometimes interfered with house- mother, wife, housekeeper, employee, and ca- work; none were reported to be actively reer aspirant overlap in time and space. opposed. These sociologists say that the trip between Most of the women said, however, that their work and home is often a useful separation husbands helped no more with housework than between two arenas of social interaction. Thus, they had before. The women had been, and still eliminating the commute may be a cost as well were, predominantly responsible for the house- as a benefit. hold work, and a few spontaneously expressed dissatisfaction or resentment of this. Most Effects on Society were unable to draw boundaries between household and work responsibilities, and move back Workers and employers are part of one soci- and forth between them during the day. ety and the interests and concerns of each are Even those home workers without children part of the public interest. But society at large to care for often report significant stress re- may have a general interest separate from the sulting from the lack of separation between specific concerns of either party. work and family responsibilities. Saloman and In this case, some of the costs that are or- Saloman, in a paper on home-based work from dinarily borne by employers or shared by em- the perspective of the sociology of work, point ployers and employees are shifted to workers— out that: for example, in the case of independent con- Work and family life today are not only tractors, social security taxes, health insur- physically separate entities, but each also gives ance, pensions, and the costs associated with rise to distinctly different role behavior that periods when the workload falls below normal may have little in common. It is not only that levels for long periods of time. For people who the two different environments require differ- are not employed, those costs ultimately may ent behavior, but that they also offer the indi- be borne by the taxpayers. Thus, a strong vidual a chance to express different aspects trend toward farming out work to “independ- of his or her personality .85 ent contractors’ who were previously, or would Sociologists define a‘ ‘role’ as a set of struc- otherwise be, employees, also implies a shift tural demands being placed on the individual of life-cyle costs from the employer to the gen- ——. — eral public. “’Ibid., citing D.T. Hall, “A Model of Coping With Role Conflict: The Role Behavior of College Educated Women, ” “’This was a theme that recurred repeatedly in the inter- Administrative Science Qmrterl.v 17 (4), 1972. See also J. Pleck, views conducted by Christensen. “The Work-Family Role System, Social Problems 24 (48), 1977. “’Ilan Saloman and Meira Saloman, op. cit., pp. 15-18, 21. —

Ch, 7—Home-Based Automated Office Work . 205

LEGAL AND REGULATORY BARRIERS TO HOME-BASED WORK Zoning laws in some communities prohibit based workers providing transcription serv- any paid employment in residential areas.87 The ices for one person or organization are employ- Internal Revenue Service (IRS) has in recent ees at least for certain tax purposes. go The ef- years progressively restricted the income tax fects of these rulings on home-based clerical deductions that may be taken for home offices. work are not yet fully apparent. It will open It is not clear under what conditions home- the door for home-based clerical workers, if based workers can claim deductions, especially they choose, to argue that they are employ- if the workspace that they use is not entirely ees, even if regarded by their client as con- dedicated to work (many home-based work- tractors, and thus, entitled to certain worker ers use a corner of the dining room, bedroom, benefits and safeguards. or living room). But when there is dedicated Government work-at-home pilot programs space, a recent IRS ruling says that the home have been frustrated or terminated because office is to be treated as business property of regulatory requirements. The pilot program rather than residential property, and thus part of the Army Material Development and Read- of the proceeds of selling a house that includes iness Command wanted to use either direct a home office are not eligible for the standard lines or telephones with a modem to connect exclusion from tax on the proceeds allowed home-based workers to the central computer. to people who immediately buy another house, 8s The Army Communications Command deter- or who are over 55 when they sell the house. mined that for the government to provide tele- There have until recently been unresolved phone service to a home violated a Federal stat- questions about the status of home-based “con- ute;91 but employees could not use their own tractors’ who contract with only one organiza- telephones because another statute” placed tion, especially, if they have previously been some limitations on government acceptance employees of that organization. The National of voluntary services from individuals.93 The Labor Relations Board has ruled, in similar problem was solved by installing direct lines situations, that such independent contractors without voice capability; a legal opinion sanc- are in fact employees. The tax code says that tioned occasional use of the employee’s home anyone who performs services for any person phone to communicate with a supervisor. as a home worker, performing work according This introduced a second problem: how to to specifications on materials furnished by the protect the government if personal property other person and required to return the fin- was damaged as a result of installing the com- ished product to that person, is an employee. munication lines or the use of government- This holds unless that person has a substan- owned equipment. This was solved by requir- tial investment in facilities used for the work, ing employees to sign a “hold harmless’ agree- in which case, he or she may be an independ- ment with the government as a condition for 89 The Internal Revenue Serv- ent contractor. participation.” ice has ruled specifically that computers with -- word processing capability are not ‘‘ substan- “’’Internal Re\’enue Ser\rice, Technical .4d\’isor?’ hl[~moran- tial investments’ in that sense, and that home- dum 8451004, Aug. 1, 1984. Index nos. 312 1.04 -00,” 3306,05- 00, 3401.04-00. ‘4 Stat. 32 U.S.C. 1348. ‘-Tammara H. Wolfgang, “M’orking at Home: The (jrowth ‘ Rev. Stat. 3679, 31 U.S.C. 1342. of Cottage Industry, ” The Futurist, ,June 1984, p, 31. 4’McI)avid, op. cit. “’1’e]ecommuting Re$’iew, Dec. 31, 1984, p. 7. “That is, an agreement not to hold the go\wrnment liable “ ‘Sec. 312 l(d) (3) (C) of the Internal Re\.enue Code. for accidental damages, 206 ● Automation of America’s Offices — —.

A third problem was the question of respon- The more general question as to how Occupa- sibility y for injury to the employee while work- tional Safety and Health rules apply to home- ing at home. Workers’ Compensation (U. S. C., based workers is also unanswered. Laws per- title 5, sec. 8102) covers Federal employees taining to the use of VDTS in the office have on duty, but the question was how to prove been proposed in 13 States but it is not known that they were on duty when the accident oc- how these will apply to home-based employees.” curred. The solution to this problem was a writ- A British document illustrates that these ten work agreement stating hours to be worked questions arise in other countries. Draft regu- each day; participants had to formally request lations proposed by the U.K. Health and Safe- changes to their designated work schedule and ty Commission in 1979 says that: get a supervisor’s approval. This of course eliminated one of the major benefits that work- Home workers, properly speaking, work for ers typically see in working at home. the person who puts out work to them in the sense that they contribute to products which Finally, this program ended when govern- he markets. For this reason, those who put ment auditors ruled that there was a risk of out work to home workers bear the prime fraud or abuse in spite of electronic monitor- responsibility for ensuring that, so far as is ing of work done at home. reasonably practical, no risks to health and safety arise. 98 Some of these problems also appear in the private sector, for example, the problems with In the next paragraph however, clerical work- the installation of communication lines and ers are expressly excluded: “The Commission, questions related to the protection of home particularly in the absence of evidence of risk workers from work-related injury or illness. to home workers from these processes . . . pro- Installing an additional telephone line in a pose to exclude from these regulations all of- rented residence, for example, sometimes re- fice type work undertaken in domestic prem- quires the permission of the owner. One study ises. ” The document continues: of home-based corporate employees found that It is important to reemphasize that any per- half of them had no accident insurance, and son requiring a home worker to utilize poten- most “assumed” that they were covered by tially hazardous processes in connection with Workers’ Compensation.95 It appears to be true clerical work is nonetheless bound by the re- that home workers are covered by Workers’ quirement . . . to ensure that risk is controlled. Compensation if injured while working at No further reasoning supporting the exclusion home, and by the employer’s insurance plan is given, nor are “potentially hazardous proc- if injured at the same location while not esses in connection with clerical work” speci- working-if the worker is covered by employee fied or defined. benefits.96 In either case, how the worker is to demonstrate whether or not he or she was actually working when injured, is so far unan- “Gregory, op. cit., p. 2. swered. ““Health and Safety Commission, Home Workers: Draft ——. . . — Regulations, consultative document (issued by the Commis- “Pratt, op. cit., p. 8. sion in compliance with its duty to consult under sec. 50(3) “ Honan, op. cit., p. 91. of the Health and Safety at Work, etc., Act, 1974, 1979, p. 1.

PUBLIC POLICY ISSUES

Encouragement or Prohibition of actively discourage or forbid it, or 3) take nei- Home-Based Office Work ther action. The primary public policy issue in home- Parties at interest include: employers, home- based office work is whether the Federal Gov.. based workers, their families, other workers ernment should: 1) actively encourage it, 2) (especially clerical workers and working women Ch. 7—Home-Based Automated Office Work ● 207 with children), and unions. The issue also tends ● strong enforcement of the rules requiring to engage people with an ideological position organizations to treat independent con- regarding home and family values, equity for tractors in some situations as employees, women, and alternative life styles. Society in with full benefits; general has an interest, in that some poten- ● placing a special tax on income derived tial costs may be shifted to the taxpayer when from services provided from homes, for home-based workers are converted to the sta- both the employer and the employee; and tus of independent contractors. ● high telephone rates for digitalized information transmitted between office and re- Congress, and State governments, could mote workers, which would run counter take a number of steps to further encourage home-based work, although these are probably to present policies of deregulation. necessary. These include: Other government actions are possible that would both: 1) tend to discourage the spread revising IRS rulings on independent con- of home-based clerical work, and 2) enhance tractors and relieving employers of some the element of free choice for home-based work, tax liabilities for them, for example, re- thereby reducing the possibility that it will writing social security tax provisions; be used exploitatively. These actions are: resolving the problems of applying workers’ compensation to work performed in ● developing subsidized, high-quality day the home; care centers for children of working parents; persuading States to grant exemption ● providing larger tax deductions for ex- from zoning and building codes for com- penses related to child care (or the care puter-mediated employment in residential of elderly or infirm dependents); and buildings; ● requiring or providing further significant providing significant tax incentives for incentives for modifying transportation equipment purchased for home-based systems and office environments to facili- work; i.e., a tax credit rather than de- tate employment of the handicapped, and ductions; and providing positive inducements for em- clarifying and expanding tax deductions ployment of the handicapped. - allowed on home office;, especially pro- Congress may choose not to take actions ei- viding large deductions when all or a sig- ther to encourage or discourage home-based nificant portion of family income is earned work. There are now few important legal or in the home (this would benefit some regulatory barriers to its growth; therefore the home-owning workers). option of no-action will allow its spread. Even- If public policy is to discourage home-based tually, home-based work is likely to grow since office work—or more narrowly, home-based it offers benefits to both employers and many clerical work—the clearest option is to prohibit individual employees, while the costs that it it, as was done for some other occupations in imposes on some workers are generally con- the 1930s. However, this would require very sidered acceptable in the absence of more de- careful definition to limit the prohibition to sirable alternatives. those kinds of office work that are subject to Controversy about home-based work is likely exploitation. The prohibition would very likely to become a major policy issue only if and when be seen, even by some of those it was designed one of three conditions obtain: to protect, as discrimination against women (who would be mostly affected) or against cer- the number of home-based clerical work- tain occupational and income groups. ers becomes a significant fraction of all clerical workers, so that this becomes a There are a few ways to discourage the factor in the competitive position of of- spread of home-based work that are largely fice workers in the job market and in ne- the converse of options for encouraging it: gotiations with employers; 208 ● Automation of America’s Offices

● cases of serious exploitation of home- based work, especially with regard to health based workers come to public notice and safety issues. through the media; and/or Questions with regard to regulation are: ● unions are highly successful in their attempt to organize white-collar workers clarification of the application of existing regulations to home-based work (e.g., Workman’s Compensation); Regulation of Home-Based . what additional protection is needed for Office Work home-based workers? and what means can be devised for effective If, however, the Federal Government nei- implementation and enforcement of reg- ther actively promotes nor prohibits home” ulations related to home-based work? based office work, then issues arise regarding its regulation to provide protections that are With regard to the last question, there are assured to other workers. In summary, these concerns that any attempts to implement and include wage and hour guarantees, assurance enforce regulation of home-based work may of safe and healthy working conditions, the destroy the benefits for which it is valued (i.e., right to negotiate collectively with employers, autonomy over work hours), or may lead to guarantee of equal opportunity, equitable pay, unacceptable violations of the privacy of work- and equitable access to insurance, pensions, ers and their families. and other entitlements. This—how existing labor standards can be At present, managers and professionals are implemented and enforced for home-based generally exempt from the Fair Labor Stand- workers—is in fact, the critical policy issue ards Act of 1938 (which covers such conditions most likely to confront the Congress in this of work as wages and hours) and managers, area in the immediate future. It is the point but not professionals, are exempt from the Na- on which opponents usually base their argu- tional Labor Relations Act (right to collective ment for an outright ban, since they maintain bargaining), whether they work in an office that real enforcement will be extremely costly, or at home. They are assumed to protect them- and in practice impossible. This is the prob- selves individually by negotiation with em- lem that led to the ban on home-based work ployers, although some belong to unions or in some industries in the 1930s. However there professional organizations that bargain collec- has been little real examination of the possi- tively. They are however covered by the Equal bilities and difficulties of enforcement today. Opportunity Act and other recent work-related It can be argued that the same difficulties legislation. would arise in enforcing a prohibition. It can also be argued that either a ban or regulation The chief concern in regulation of working would be easier to enforce today than in the at home therefore focuses on clerical workers. Predominantly female, nonunionized, and 1930s. Reporting requirements laid on busi- often bearing heavy responsibilities as mothers nesses have proliferated, the rights of work- (increasingly, as single parents), they are par- ers and the benefits they stand to gain by ticularly vulnerable to exploitation. Another demanding those rights are larger, and people doing computer-mediated work are likely growing concern is the vulnerability of new to be far better educated and more sophisti- immigrants, of disadvantaged minorities, and of elderly workers to possible exploitation. cated in understanding to what protection they are entitled. The same technologies that make It is quite possible that States or local gov- computer-mediated work at home possible, ernments may impose regulations on home- might be used to make it difficult to hide. Chapter 8 Off-Shore Office Work Contents

Page The Present and Future Status of Off-Shore Offices ...... 211 How Off-Shore Offices Operate ...... 214 Linkage Arrangements ...... 214 Types of Data Processing ...... 215 Examples of Off-Shore Offices ...... 215 Factors in Moving Data Entry Off-Shore ...... 216 Differing Views of Off-Shore Office Work ...... 223 U.S. Off-Shore Companies ...... 223 U.S. Labor Organizations...... 224 Foreign Government Officials ...... 225 Economic Development Organizations ...... 226 Public Policy Issues ...... 227 Regulating or Prohibiting Off-Shore Offices ...... 227 Regulation of Data ...... 227 Encourage or Do Nothing About Off-Shore Office Work ...... 230 Chapter 8 Off-Shore Office Work1

While the cost of electronic office equipment in the United States may earn at least six times declines, the cost of employing Americans to the latter figure per week. Even with trans- perform routine office tasks is rising both per portation, communications, and other costs employee and in the aggregate. Some U.S. accounted for, total expenses for keypunch- firms have established off-shore offices in or- ing data off-shore may still not equal the cost der to take advantage of lower cost labor. Some of carrying out the process domestically. z of these offices involve manual clerical work Several data-entry facilities are presently such as coupon sorting. However, advances operating in the Caribbean region, and their in information and communication technol- number is expected to increase. Labor costs ogies make it increasingly attractive to move are low and the region is easily accessible and data-entry operations off-shore. Data entry close to the United States. Transportation and means converting information from ‘hard’ or communication networks are reasonably well paper form into digital form so it can be stored developed, literacy rates are high, and there electronically. This entry phase of data proc- are favorable tax provisions for foreign in- essing is commonly referred to as “keypunch- vestors. The Caribbean is only one region, ing, “keyboarding,” or “keying.” however, in which off-shore offices could pro- High domestic labor costs could lead to an liferate. international division of labor in data proc- These operations can be simple to imple- essing. Data-entry clerks in Caribbean coun- ment. The tools and raw materials are light, tries, for example, typically earn weekly wages relatively inexpensive, and easy to transport. that range from about $15 (U.S. equivalent) If full advantage is taken of communication to approximately $60, while their counterparts technologies, distance and time become almost incidental factors when choosing sites at which “I’his chapter draws hea~’il~. from an OTA contractor re- to locate off-shore offices. port: (’Christopher P. Astriab, .4n .+ls.sessment ofoff-.$hore Of- fice 11’ork, prepared for the U.S. Congress. Office of ‘I’echnolog~’ .4ssessment, contract No, 583-0630, Feb. 28, 198.5; and -F’ig-ures deri~’ed from Caribbean Central American ~\ction from an additional report from Consultant Anne Posthuma. data (Washington, DC, 1982).

THE PRESENT AND FUTURE STATUS OF OFF-SHORE OFFICES While off-shore offices have existed for the data processing operations in the Caribbean. better part of two decades, the arrival of elec- Barbados hosts seven such firms, while Ja- tronic communication and information tech- maica hosts at least three, and St. Christopher- nologies has set the stage for new and possi- Nevis and Haiti each host one. In these four bly rapid growth in the near future. The countries, approximately 2,300 workers are number of companies entering data at off-shore directly employed in off-shore offices. The sites are still few, and the impact of the largest such office in the region is a coupon- phenomenon on foreign and domestic employ- sorting operation that employs approximate- ment and economic situations is at present in- ly 1,200 people in Haiti. significant. At least three off-shore offices in St. Vin- Off-shore data processing facilities are pre- cent, Haiti, and Grenada closed down in re- dominantly located in the Caribbean region. cent years. Managerial and transportation Currently, there are at least 12 U.S. firms with problems were the causes; the ability of the

211 212 Automation of America’s Offices employees to carry out the operations were give (data-entry firms) a big market to shoot 7 apparently not in question.3 In the case of at . , . Grenada, which hosted a firm for some 10 In view of dramatic growth in data process- years, recent “unsettled conditions” there were ing and expanding needs for digital data, these 4 cited as the cause. observations may be justified. There is con- Other countries including India, Singapore, siderable interest in establishing new data the People’s Republic of China, and Ireland processing facilities abroad and some compa- also host at least one data-entry firm each. nies already in the business have cited expan- Approximately 27 coupon-sorting operations sion plans. are located in Mexico, one of the first coun- Several companies are now studying the pos- tries to host off-shore offices. The total num- sibility of setting up keying operations in ber of people employed by these firms is not the Caribbean. Barbados, St. Lucia, St. Kitts- known. Nevis, Dominica, Jamaica, Trinidad-Tobago, There are generally two types of firms in- and Grenada are all possible sites for further 8 volved in establishing off-shore offices. The growth. first perform only their own clerical work off- Firms already in the region maybe expected shore in order to reduce labor costs. The sec- to expand, but the scale of this expansion is ond group are vendors who have established uncertain. A firm in Jamaica that presently off-shore offices to provide data processing or- employs approximately 60 plans to expand to word processing services to clients in the about 500 employees over the next several United States. years. This growth-approximately 700 per- All signs indicate that off-shore data entry cent—is probably exceptional, however. The could undergo rapid growth over the next 10 whole industry now employs about 500 peo- to 15 years. The vendors who provide these ple in Jamaica. The Jamaican Government services are optimistic about the future of the encourages this industry, and ,Jamaica Invest- industry: ment Promotion, Ltd.—the government development agency—has reportedly secured con- In 3 to 5 years we expect to have 300 to tracts for another company that would require 500 people (keying) in different locations (in it to expand “significantly. Jamaica). This is a large market, perhaps $50 billion by 1990.5 While the industry has existed m the Carib- The growth industry in Barbados has to bean for some time, investors are showing be information services and data process- renewed interest since the passage of the Carib- ing . . . As Barbarians acquire data process- bean Basin Initiative Act by the U.S. Con- ing skill, Barbados, with its investment in gress.10 While no specific provisions in the act telecommunications, can develop software deal with data processing, the act does express and other applications. The industry in Bar- the commitment of the U.S. Government to bados . . . has tremendous opportunity to assist in the development of the region. Early grow and evolve, especially given. . . the gov- G signs of success in using satellites to trans- ernment’s commitment to it. For now, any softening of data-entry mar- “’The Instant Off-Shore Office, ” Business Week, Mar. 15, kets is being offset by explosive growth of 1982, p. 136. data-base services. Such growing needs will “Anecdotal information from various interviews, U.S. De- partment of Commerce, Caribbean Basin Business Informa- ‘Donald Marsden, Coopers, and Lybrand, St. Kitts-Nevis. tion Center, and others. Personal interview, Miami, Dec. 7, 1984. “Audley Shaw, Director, North America, Jamaica National ‘Ibid. Investment Promotion, Ltd., New York, personal interview, ‘Mary Ramond, “Jamaica On the Move, ” Business Week .New York, Jan. 14, 1985. special advertising section, Sept. 17, 1985. (Gary Bechtel, presi- “Gary Bechtel, President, Telemar Data Systems, Fair- dent of Telemar Data Systems, Fairfield, NJ, is quoted.) field, NJ, personal interview, and presentation given at the Mi- ‘Mary Ramond, “Barbados - 1984, ” Business Week, special ami Conference on the Caribbean “Off-Shore Key Punch Oper- advertising section, Apr. 16, 1984. ations” square table discussion, Miami, Dec. 7, 1984. Ch. 8—Off-Shore Office Work . 213 mit data from the region are also attracting At least one U.S. firm keys data in Singa- attention. Based on observations of people pore, but this site may have been selected be- knowledgeable about the industry, it is prob- cause the data is then relayed to the firm’s ably safe to assume that at least l,000 to 2,000 office in Australia. Presumably, transmission additional data-entry jobs could be created in costs also were an important factor. However, the Caribbean region over the next decade. a World Bank report says that two-thirds of Singapore’s total output is services and over In Mexico, the growth potential of data proc- 35 percent of these services were devoted to essing is high. An estimated annual growth the production and distribution of information. rate of 10 percent has been cited, but competi- 11 The primary information sector in Singapore tion from the Caribbean region is anticipated. contributes over 24 percent of gross domestic In other areas of the world, growth is de- products. 15 In the Far East, therefore, Singa- pendent on: 1) companies’ willingness to estab- pore would be a promising site for expansion lish operations at great distances from the of data processing work. United States, 2) the type of data they are deal- As to the future of off-shore keying, there ing with (i. e., the lead time available for data- may be inherent limitations on growth. Inter- conversion work), and 3) the mode of opera- national telecommunications to link off-shore tion being used (i.e., air transportation or elec- offices with the United States may not be avail- tronic transmission). At the present time, the able everywhere or may not have the tremen- practice of flying hard copy to off-shore sites dous growth in capacity that some expect. Not and returning the data on magnetic media is all “raw” information (i.e., hard copy) can be the predominant mode of operation. Only a readily transmitted abroad for keying. Fac- few firms are using two-way satellite links to simile clarity is still a significant problem, par- any extent, and the oldest has been operating ticularly if operators must process large vol- for about 3 years. Unless satellites are used, umes of data. The use of facsimile equipment it seems unlikely that time-sensitive work does not appear to be cost effective as yet. would be exported to areas such as the Far Facsimile transmitters may take as long as East or India. Air transport to these areas can 6 minutes per page, “. . . far too long to let be relatively slow and complicated, particu- overseas operators compete for time-sensitive larly if time is of the essence. 16 jobs, ” according to one firm. Wage rates in these areas, however, can be Advances in facsimile technology will, pre- much lower than in the Caribbean. In the Peo- sumably, solve these problems. But the very ple’s Republic of China, a figure of $2.00 per 12 fact that such advances are being made may week for clerical workers was cited. In In- drastically reduce the need to hire operators dia, the labor rate for keyers may be as little for many kinds of data-entry work. as one-tenth to one-fifteenth of the U.S. rate, which more than compensates for transport Perhaps the most important technological costs, ’3 The president of one firm operating consideration when assessing the future growth there estimates that it would cost approxi- of the industry regards optical character read- mately $65 to key 10,000 characters in the ers (OCRs). As advances in the field permit United States, while he can get the same job the widespread use of scanners, and the use done in India for about $7 to $10, and the qual- of machine-readable documents increases, the ity is higher. ’4 need for human intervention in data entry will be reduced considerably. — ..— . ‘lMollie Shields, Commercial Officer, U.S. Embassy, Mex- ico City, Mexico. Telexed response to inquiry. Posthuma, op. cit., p. 5. ‘ ‘Nick E}age, General Information Ser\’ices, Philadelphia. “W’orld Bank, il’orld De\’elopment Report, 1982, New Telephone inter~’iew, July 3, 1984. York, 1982. ‘Ibid. “’’The Instant Off-Shore Off ice,” p. 136.

52-644 0 - 85 - 8 214 Automation of America’s Offices

Most of the experts consulted on behalf of but to say that we’ll pull out in the near fu- this study agreed that the arrival of cost effi- ture is also not accurate. ”17 Others in the in- cient, highly capable optical scanners would dustry agreed. It is thus reasonable to expect mean the end of off-shore data-entry work. For that off-shore keying may have an effective example, an executive of one company believes lifetime of only 15 to 20 years, but during that that his firm will stay as long as the cost- period it could grow rapidly and have a signif- effectiveness of satellite transmission is not icant effect on U.S. clerical employment. outpaced by advanced technologies that could eliminate the need for a majority of data-entry jobs altogether: “To say that we’ll be doing ‘Posthuma, op. cit., p. 18. (James Marston, vice president this for the rest of our lives is not accurate; of data processing for American Airlines, is quoted. )

HOW OFF-SHORE OFFICES OPERATE Linkage Arrangements The second method of linking sites involves air shipping documents from the domestic There are three principal methods of link- point of origin to the processing site and then ing off-shore data-entry sites with data sources electronically transmitting the digitized data and end users in the United States. All three back to its source or to other end users. Typi- use some combination of air shipment or elec- cally, the data processing sites are linked via tronic transmission to move data back and terrestrial telephone lines to satellite Earth forth between sites. stations. The use of this method is, of course, limited by the availability and proximity of The least sophisticated approach is to ship earth stations, but permits shorter turnaround information by air in both directions. Typi- times. Where satellite communication facilities cally, paper documents, microfiche, magnetic are not available it maybe possible to use sub- tapes, cards or discs, or audio recordings are marine cable links to the continental United collected at one or more U.S. sites for packag- States. Theoretically, the reverse of this proc- ing. In the case of paper documents some pre- ess (i.e., transmitting data to the off-shore liminary hand sorting may occur at this time. site and shipping hard documents back to the A major U.S. airline, for example, sorts ticket United States) is also possible, but OTA found stubs according to station, flight number, and no instances of such use. passenger class before shipping them abroad, Finally, electronic links may be used to trans- Documents are then packaged and shipped mit data in both directions. Documents are to the off-shore site via regular air freight or facsimilied in the United States and trans- overnight courier services. On arrival at the mitted to the off-shore site, keypunched, and host country airport, the packages are cleared then retransmitted back to end users. Infor- through customs and delivered to the proc- mation that has already been digitized, but essing site by courier services or employees requires further processing or revision may of the user firm. At the processing facility each also be sent abroad by simply “playing back” keyer has a video display terminal that is typi- data on magnetic media and transmitting it cally linked to an onsite computer central proc from the United States to the off-shore site. essing unit. The information on the documents is keyed into the computer, the data is recorded Two-way electronic links offer the shortest on magnetic tapes, disks or cards, and shipped possible turnaround times, and may, in fact, back to the United States, where the data can be the only practical method of processing data be stored, printed on paper, or fed into a com- off-shore when the ability to deliver it to end puter program for analysis. users within a very short time is essential. A major U.S. printing house that must process and deliver financial data to end users in as little as 15 hours is presently exploring the feasibility of establishing data processing facilities off-shore.

Types of Data Processing The kinds of data processed off-shore and the types of processing they require are many and varied. Documents sent abroad for processing include manuscripts; legal documents; insurance or medical records; statistical data; financial statements; coupons for food and other products; order or subscription forms; business documents such as ledgers, payrolls and the like; ticket stubs; mailing lists; con- test or sweepstakes entry forms; and audio from airline ticket stubs for a major U.S. airline, recordings. In most cases, the documents are the keyed information is returned to the produced in large volumes on a relatively con- United States via satellite tinuous basis, and their conversion to electronic form is essential to the end users. ● A California-based firm air-freights batches Processing in many instances is limited to of paper copy to its keying facility in Sin- converting textual or tabular information on gapore. From there, the keyed data is sent hard copy into digital form so it may be more to its branch office in Australia via satellite. This allows the company to update readily reproduced, stored, manipulated, or the files of its Australian clients on a daily analyzed. One company, for example, keys in basis. mailing lists and contestant entry forms, while A Texas businessman has an arrangement another concentrates on keying textual and financial data for a Fortune 500 client base. with students at Tsinghua University in the People’s Republic of China to key in Processing may also involve reformatting numerical and narrative information from documents or revising and correcting texts surveys. Magnetic tapes containing the that have already been proofread or edited and information are then flown to the United digitized in the United States. The printing States for analysis. firm noted previously may transmit to an off- In Limerick, Ireland, a major U.S. mar- shore site “rough’ copy that had already been ket research firm keys magazine subscrip- keyed. The off-shore facility would key in the tion information. The same firm has necessary revisions to make copy ready for branches in Port-au-Prince, Haiti, and Chi- typesetting. 18 Another firm reformats finan- huahua, Mexico, where product coupons cial data at its off-shore facility into standard are sorted and rebate lists are developed. forms for use in the United States. ’g ● A major U.S. international airline collects ticket stubs from its operating bases Examples of Off-Shore Offices throughout the United States and flies them to its keying facility in Barbados. The following capsule descriptions exemplify There, information on passenger class, the types of off-shore offices and the methods point of embarkation, and destinations, by which they operate. etc., is keyed by a staff of almost, 300. The revenue database is sent over private ‘Keith Adams, R.R. Donnelly & Sons Co., Chicago. Per- sonal interview, Miami, Dec. 5, 1984, leased lines via satellite to its data proc- ‘gBechtel, op. cit. essing office in the United States on a —216 ● Automation of America’s Offices —

daily basis. The company transmits about Factors in Moving Data Entry 2.25 million characters to the United Off-Shore States every month. Information on data entry personnel efficiency is transmitted Several general factors encourage American back to Barbados for analysis by man- companies to establish off-shore offices: agerial staff. The airline is now soliciting ● growth in information processing and in- contract work in order to make its keying creased need to convert information from operation into a profit center. hard copy to digital form; ● A New Jersey company has entered into ● rising domestic labor costs and the avail- a joint venture with a Jamaican firm to ability of lower cost labor off-shore; key financial data for approximately two ● the availability of good communication dozen Fortune 500 clients. The data-- infrastructure; about 50 percent textual and 50 percent ● the existence of suitable office space, tabular-is used for financial reports. The transportation facilities, electrical power, firm cited a document turnaround time and other support infrastructure; of 1 to 2 weeks. It presently flies hard copy ● the availability of measures that can be to the facility for keying, but anticipates taken to ensure the security of informa- using facsimile equipment in the United tion in transit; States to transmit information to Jamaica, ● the general absence of regulatory impedi- and then return it to the United States ments to the exportation or to the flow via satellite. Approximately 60 people are of data across international borders; and employed in the firm. It expects to dou- ● the existence of politically stable and eco- ble its size sometime in 1985. nomically attractive environments in oth- ● A firm in Montego Bay, Jamaica keys in er countries. mailing lists for such companies as The Great American Sweepstakes and Pub- The Information Market lisher’s Clearinghouse. The responses to mass mailings are flown to Jamaica and The director of one foreign government in- mailing lists on magnetic media are flown dustrial development corporation says: back to the United States. In today’s world, information resources A small, Philadelphia-based firm operates have become abundant. . . and more efficient a joint venture data-entry service that em- as a result of the progress stimulated by the ploys about 20 people in Madras, India. new electronic technology. It seems fairly The company concentrates on keying in clear, to me at least, that as the U.S. econ- past records, and disk-to-disk conversion omy continues its transformation from indus- of data for clients shifting from one kind trial activities toward information creation and distribution, that the demands for infor- of computer system to another. It had 20 originally used a Kurzweil optical scan- mation services will continue. ner that translates printed characters into The need for rapid access to information digital form for storage on magnetic me- helped to stimulate the creation of electronic dia. It found that use of the machine was data storage and retrieval systems. Their ex- not cost effective, and also encountered istence, in turn, has accelerated the speed at technical problems regarding the capabil- which information must be generated, and in- ity of the machine to read accurately. It ‘[’Fred Gollop, Chairman, Barbados Industrial Development gave the machine to a university and now Corp., Bridgetown, Barbados. Gollop moderated the “Off-shore uses data-entry workers exclusively to key Key Punch Operations” square table discussion at the Miami in information. Conference on the Caribbean, Miami, Dec. 7, 1984. Ch. 8—Off-Shore Office Work . 217 creased the volume of data needed to enter about 75 percent less off-shore than it would into computerized information systems, The in the United States to obtain a comparable president of a U.S. firm, presently engaged level of labor output. in off-shore keying, notes that “. . . the his- The availability of trained workers is a ma- tory of the world, which is in writing, is about to be put into electronic databases through- jor consideration in choosing an off-shore site. 21 Because the bulk of the work done at data- out the world. entry sites involves typing (typically, 60 to The capability and need to generate infor- 90 percent of the employees of data-entry oper- mation in large volumes and on a relatively ations may be keyers), a pool of trained typists continuous basis is essential for the move to must be assembled. Companies located in off-shore data-entry operations. It is the Jamaica and Barbados report no apparent strength of this growing information market shortage of trained clerical workers; they in- that makes owners of off-shore keying opera- variably had more job applicants than positions enthusiastic about their future. In the tions.24 Young women comprise about 99 per- absence of an expanding information market, cent of the workers. One firm reported that the viability of off-shore operations would be the average age of its keyers is 26.25 Most of doubtful. Attracting workers would be diffi- them have at least a secondary school educa- cult if work were sporadic, and cost efficiency tion, while many have completed at least some could decline rapidly, thus defeating the pur- post-secondary training. pose of establishing such operations in the first A keying rate of 10,000 keystrokes per hour place. 26 is cited as an industry standard. Higher rates Domestic and Foreign Labor Costs may be achieved if conversion is limited to keying tabular data on a numerical ten-key pad, In the recent past, there has been a trend while rates may average somewhat lower if toward an international division of labor, in text data is being keyed. which labor intensive manufacturing work has moved to countries where wages are signifi- All companies surveyed indicated that a high cantly lower than in the United States. This literacy rate was a primary consideration. Lit- has allowed many American manufacturing eracy in English is strongly preferred to avoid firms to maintain their competitiveness in in- the complications of crossing a language bar- ternational markets. The exportation of data- rier, although language barriers may not be entry work—one of the most labor intensive critical if keying is limited to numerical data. phases of data processing—is now occurring However, other firms have experimented for the same reasons. with using non-English speaking workers for The hourly wage rate for keyers in other keying text, and report excellent results. The countries may range from one-fourth to as lit- workers do not need to understand words to tle as one-fifteenth of rates paid to U.S. key- key the right letters. Workers can learn to rec- ers.22 One U.S. firm reports that it was paying ognize up to 100 characters without any prior domestic keyers $9.50 per hour, whereas aver- knowledge of them, and to respond by hitting age hourly rates at its off-shore facility in Bar- the correct key. Because thousands of ideo- bados are approximately $2.10.23 This is a sav- grams are used to write many Oriental lan- ings of 78 percent in labor costs alone. While guages, workers literate in these languages companies use different methods of estimat- may be particularly adept at character recog- ing their savings by moving off-shore, those nition. questioned indicated that it is costing them

Bechtel, op. cit. -’Bechtel, op. cit.; and Jordan, op. cit. ‘-Page, op. cit. -c Jordan, op. cit. -’Jordan, op. cit. “Bechtel, op. cit. 218 Automation of America’s Offices

The ability to achieve high accuracy rates operations. The degree to which these charac- seems to be a direct result of employing low teristics are present promotes establishment cost labor. In order to assure high standards of off-shore data conversion. of quality control, two or three keyers may If English literacy is not critical, then vir- be given the same information to key, on the tually any developing country willing to pro- theory that no two people will make the same vide the necessary infrastructure and having error. After copy is “double-” or “triple- a large pool of unemployed people could host stroked, ’ parity checks may be conducted to an off-shore data-entry operation. spot errors. The original copy is then checked in order to correct those errors .27 It has been Communication Technology reported that by using this technique firms have been able to obtain very high accuracy Advances in telecommunication, in particu- rates even using non-English speaking keyers. lar, the advent of satellite communication, have encouraged the operation of off-shore It would obviously be expensive to achieve offices. Unlike manufacturing industries, which quality control in this manner in the United face high costs and pay a time penalty for States. Using the hourly wage comparison transporting raw materials and products, the cited earlier as an example, copy triple-stroked information industry may ‘‘ship’ its raw ma- for one hour in the United States would cost terials and products thousands of miles in $28.50, while the same task off-shore would seconds when in electronic form. cost $6.30. This estimate is for Barbados, where wage rates are higher than those for International communications usually take most developing countries. place by satellite or by undersea cable. The use of satellites appears to predominate, but Some firms have noted that it is more diffi- the use of international submarine cables can- cult to find skilled managers locally than it not be discounted, and the desire for greater is to find clerk-typists. However, this was usu- security and reliability of data transmissions ally overcome through programs to promote may prompt some firms to maintain access and train supervisory personnel, sometimes to both. by sending them to the U.S. office for training.28 A number of technologies are used to provide access to the international communica- The size of available off-shore labor pools tion networks. Some firms have satellite earth may be an important consideration for large stations on their own premises. Most, how- operations, especially in countries with small ever gain access to common-use earth stations populations, such as many of those in the or to undersea cable terminals as subscribers Caribbean. U.S. off-shore offices in the Carib~- to the local telephone system or by leasing bean presently employ from 10 to as many as dedicated lines. Firms transmitting large quan- 1,200 personnel each. At least one firm chose tities of data generally find dedicated lines to locate in Jamaica because keying operations more economical since they can be designed companies already were absorbing most of the to accommodate high-data transmission speeds. available labor pool in Barbados, and bidding Thus, one criterion for locating off-shore data for such labor “might get a little steep . . . 29 conversion facilities is the existence of a com- particularly for a start-up company. ” munication infrastructure with sufficient ca- In sum, countries most apt to attract U.S. pacity to provide dedicated lines to large users. firms to off-shore offices are those with low- Microwave transceivers are widely used for wage rates and a highly literate, skilled labor private line communications in the Caribbean force of a size sufficient to support proposed where an extensive microwave system is al- .—— -- . . -- . ready in place. It has been suggested that cel- ‘-Adams, op. cit. ‘Becker, op. cit.; and Jordan, op. cit. lular telephony could also offer the capability “’Bechtel, op. cit. of providing data links between off-shore . .

Ch. 8—Off-Shore Office Work ● 219 offices and international communication ter- service, or impeded the timely and proper minals. Cellular telephony allows voice or data maintenance of the phone network. communications without the use of land lines. It could play a significant role in bringing the Facilities, Transportation, and information age to Third World countries, al- Electrical Power lowing them to not only catch up, but perhaps By and large it does not appear that U.S. also even surpass the phone networks that firms have had serious difficulties in locating presently exist in the developed countries.’” facilities in which to set up shop, especially According to a representative of a U.S. cellu- in the Caribbean. Many governments have de- lar telephone company: veloped industrial estates that rent or lease Cellular will provide nationwide data net- factory space at very low rates to foreign in- work capability and needed mobile and fixed vestors. In Jamaica, for example, the average services to all segments of an emerging na- rent for such space is a mere $.42 per square tion. It may well assume the role of the wire- foot per month, or about $5 (U. S.) per square line system replacement in smaller cities and foot per year (1982 figures).” The leasing of in isolated rural areas. Cellular could be uti- space at off-shore sites is considerably cheaper lized to remove isolation, encourage disper- than in the United States, and in some cases sal of industry and increase the efficiency of so much cheaper that leasing costs may be projects located far from the urban concen- ] a minor consideration in the course of site trations of industry.’ selection. Costa Rica is expected to begin installation of a cellular system in early 1985, which will Space may be leased or purchased outright probably make it the first Third World coun- from the private sector, depending on foreign try to use cellular technology as an integral ownership restrictions imposed by govern- part of its telecommunication systems. Instal- ment. Or, it may be possible to expand exist- lation of cellular systems in several countries ing locally owned data processing facilities, if, for example, a U.S. firm enters into a joint could increase the options of firms looking for off-shore office sites. venture with an existing host country firm. Of importance to operators of many off-shore The quality of available facilities in devel- offices are the telecommunication regulations oping countries may vary considerably. Some in the host country. In many developing countries, communication networks are owned and ‘-Caribbean Central American Action, op. cit. operated by the government in order to generate public revenue. In some cases, all phone equipment and services must be purchased or leased from the government, thus limiting users’ options with regard to the availability, type, and capabilities of equipment. A country’s reputation for providing hook- up and maintenance service also deserves consideration. Clearly, it would not be desirable to establish an off-shore office where bureaucratic problems or lack of well-trained technical personnel caused significant delays in ——— Photo credlf M/v/s(r) of Trade /~?cfustrj and Deve/oprnent Charles T. 1 lagel, .4pplication of Cellular ‘17echnolog-?’ for S( Chmfoober and Neb/s L~e\wloping Countries, presented at the Miami (’conference on the Caribhean ‘‘Communications I nfrastructures’ squaretahle Off-shore data processing offices occupy a wide range discussion, N!iami, December 1984. of fact I i ties from modern office buiIdings to converted ‘ I hid. factory shells. This one is In St. Christopher and Nevis 220 Automation of America’s Offices

office buildings may be on equal footing with ment efforts to enhance their infrastructures those commonly found in the United States, with a view toward attracting still more for- while others may be simple corrugated metal eign capital, technology, and expertise. or concrete block shells adaptable to many uses. One U.S. firm adapted such a shell for Security of Data Shipments its data conversion operation in St. Kitts- and Transmissions Nevis. Another spent approximately $1 mil- With large amounts of data being trans- lion (U. S.) to upgrade an existing office build- ferred across international boundaries, secu- ing in Barbados. Its facility is regarded by rity of data shipments and transmissions is the company, the Barbados Government, and a concern, but has so far been a minor prob- the company’s competitors as a “showcase lem in off-shore sourcing. None of the firms operation” equal to the best facilities in the interviewed for OTA identified any special 33 United States. measures that they take to ensure the secu- The availability of international air trans- rity of shipments. Yet the loss or interception portation may be essential if electronic link- of documents containing sensitive information age arrangements are not being used in both could conceivably cause serious damage, par- directions. Both regular air freight and over- ticularly if, for example, information on stock night courier services are used. One reason for offerings or other financial information were the proliferation of off-shore offices in the made known prematurely, or if private, intra- Caribbean is the availability of frequent, di- corporate communications are intercepted. rect flights of relatively short duration to many Interception of such shipments is not with- of the islands from major cities in the United out its difficulties. One would need to know States. Time in transit from New York to Bar- in advance about the nature and timing of ship- bados, for example, is about 4.5 hours. This ments. If particularly sensitive documents are is particularly attractive if time-sensitive doc- being shipped, air courier services may be used uments are being dealt with. It also makes to ensure their safety. One courier firm in the it easier to manage off-shore facilities, since Caribbean region indicated that its shipments U.S. personnel may get to the sites relatively are accompanied and monitored by their per- quickly if necessary. sonnel on a continuous basis.35 The companies Companies generally indicate that availabil- shipping the information, as well as their ity and reliability of electrical power are not clients, appear to be satisfied with its security. major concerns in their site selection. Some Intercepting electronic data transmissions firms use on-site back-up electrical generators is another matter; it requires technical knowl- because power grids in some countries experi- edge, and may not necessarily yield usable, ence sporadic brownouts (i.e., voltage drops understandable data because encryption can below specified levels) or blackouts. The cost be used. Even if unscrambled transmissions of electrical power is not a major concern; in were intercepted, strings of characters may Jamaica for example electrical rates are com- not be useful unless one knows what to do with parable to those on the eastern seaboard of them.36 In some industries such as airlines, 34 the United States. much information is already shared, so the In general, facilities are less costly off-shore, value of information transmitted may be neg- although infrastructures in many countries ligible to another airline. lack the reliability and redundancy that is Nevertheless, wires can be tapped, and sat- taken for granted in the United States. The ellite transmissions can be picked up by par- growth of foreign investment in less developed ties other than the intended ones. Wiretapping countries has, in many cases, spurred govern- ‘;The firm referred to has operating bases in Miami, New ‘iGollop, op. cit. York, and other cities in the United States and the Caribbean. “Ibid. “’Jordan, op. cit. Ch. 8—Off-Shore Office Work . 221 can be detected fairly easily because the am- ied at all.38 U.S. companies keying their own plitude of an electronic signal is attenuated business data (e.g., payroll, inventory, ar- when a third-party taps the line.37 Identifying chives, etc.) may import these records duty unintended recipients of satellite transmis- free. These are classified under schedule 8, pt. sions can be far more difficult. In either case, 7 of the Tariff Schedules of the United States however, it would seem that a considerable Annotated (TSUSA) (1981) as item 870.10– amount of technical ingenuity would be re- “records, diagrams and other data with regard quired to not only intercept transmissions, but to any business . . . operation conducted out- make them usable as well. side the United States, whether on paper, cards, photographs, blueprints, tapes or other Rules and Regulations media. 39 At the present time, regulations of any sort Ordinarily, recorded magnetic tapes, cards, that bear directly on the establishment or oper- or discs are classified under TSUSA schedule ation of off-shore data-entry services appear 7, part 2, subpart G as item number 724.40– to be so few and/or minor that firms involved ‘‘recordings on magnetic tape or any medium have expressed relatively little concern over other than wire. ’ ’40 A duty of 9@ per square them. foot of recording surface is specified. Thus, Laws that generally affect off-shore keying a duty of only $9 would be payable for a record- operations are those concerning telecommu- ing on a standard 2,400 foot reel of .5" inch nications. Such laws often mandate the use computer tape (which contains 100 square feet of government-owned Post, Telephone, and of recording surface). Even this duty may not Telegraph (PTT) networks and equipment, be imposed if the recordings originated in a since the PTTs of developing nations typically country that is beneficiary to the Generalized generate revenues needed for other govern- System of Preferences. Such countries may ment functions. Firms report that these regu- export most or all of their goods to the United lations have been more of an annoyance than States duty free. In any event, recorded me- a major obstacle to off-shore sourcing. dia from data-entry operations are, by and large, regarded as returned U.S. goods and not Foreign customs regulations also do not ap- subject to duties.41 pear to have been a problem for data-entry operations. Many firms investing in develop- While the physical characteristics of the me- ing countries are granted concessions includ- dia itself are not “advanced or improved” at ing the privilege of importing raw materials keying operations, it can be argued that such and equipment duty free. The only notable media has an intangible good—information— complaints have to do with the difficulties in added to it, and is, accordingly, increased in getting documents and other items cleared value. There has been sharp criticism in this quickly through customs, especially on week- regard, particularly by U.S. labor representa- ends, which can be a problem for firms keying tives. As one union spokesman says, “You may time-sensitive documents. However, serious customs problems would probably spur authorities to make remedial actions to avoid los- —.— ‘“John R. Gray, Chief, Classification and Value Di\’ision, ing sizable foreign investments. U.S. Customs Bureau, Miami, personal inter~iew, Nliami, Dec. 6, 1984. U.S. telecommunications and customs reg- “’Tariff Schedules of the United States Annotated 1980, ulations at present raise no obstacles to off- Washington, 1980, p. 774. shore keying. Customs laws govern the im- “’Ibid. ‘]’’ The Instant Off-Shore Office, ” p. 136. Specifically, they portation of documents and magnetic record- are listed under TSUSA schedule B, pt. 1 as item number ings, but tariffs are extremely low or not lev- 800.00–’’products of the United States when returned after ha~’ing been exported, without having been advanced in \ralue or improt’ed in condition by any process of manufacture or other Hough, op. cit. means while abroad. ” 222 ● Automation of America’s Offices — be importing a $10 tape with $50,000 worth of control over economic development and of information on it. “42 growth.45 Such claims do not appear to be exaggera- Off-shore data-entry operations have not tions in view of the prodigious volume of data been significantly affected by such laws be- that can be recorded on a given amount of mag- cause they have generally been established in netic media. If recorded at maximum density the countries that have not enacted such laws. (data density is dependent on the type of rec- Many countries have not yet addressed the ording equipment used), a .5" inch wide nine- issues surrounding data and its transfer, and track computer tape can hold 6,250 bytes or these countries tend to be less developed, have characters of data per linear inch. A 2,400 foot wage rates that are generally lower, and want reel of tape holds up to 94 megabytes (i.e., 94 the jobs, training, and capital that data-entry million characters). To put this in perspective, operations can provide. They view data entry a commercial directory listing the names, ad- as a basis for the development and advance- dresses, telephone numbers, chief executives, ment of computer and computer-related indus- Standard Industrial Classification numbers, tries and capabilities. sales levels, and number of employees of the Thus, data-entry firms presently operate in top 51,000 U.S. corporations comprises only 43 a very lenient regulatory environment. Devel- about 30 million characters. This equals ap- oping host countries are not inclined to kill proximately 1,500 pages of high-density text the proverbial “goose that laid the golden egg” in very small print. by legislating against the data-entry indus- The president of a domestic data-input com- try. The benefits they obtain from it far out- pany has argued that duties should be paya- weigh any gains to be had by levying discrimi- ble at least on the labor value added to proc- natory taxes or imposing other restrictions. essed tapes and disks. The directory mentioned Undoubtedly, any moves in this direction would above, for instance, probably took at least quickly cause firms to relocate to countries 3,000 person-hours to key at 10,000 keystrokes with more favorable business environments— per hour. Using the $2.30 per hour wage for of which there are many. U.S. laws impose vir- Barbados, it would cost roughly $6,900 to en- tually no burden on off-shore sourcing. Vigor- ter all of the data in the directory. His con- ous debate over regulatory matters can be ex- cern stems from the fact that his firm has lost pected to continue, however, as labor unions “millions of dollars in contracts to off-shore and domestic firms pressure authorities to ex- firms. ’44 tend tariff treatment to international trade in data and data processing services. Certain countries have erected tariff and non- tariff barriers to regulate the content and Political Stability and Investment operation of data banks, and designate the Climate in Foreign Countries methods and routes by which data can be transferred across international borders. Where The reason most frequently cited by U.S. these regulations exist, they usually stem from firms in all sectors for not investing abroad governments’ concerns over the privacy of is perhaps that they must deal with too many their citizens, national security, perceived loss unknowns. Political stability of a foreign coun- of cultural independence, and concern that try and its policies regarding foreign, private unrestricted data transfers could lead to loss investment are foremost concerns of U.S. businesses thinking about establishing off-shore “Dennis Chamott, Assistant Director, Professional Work- ers Division, AFL-CIO, Washington, DC, personal interview. enterprises. Washington, DC, Dec. 17, 1984. “The listing referred to is Ward’s Directory of 51,000 Largest U.S. Corporations, vol. 1 (Petaluma, CA: Baldwin H. Ward Publications, 1984). The directory consists of “1,504 pages, 45James R. Basche, Jr., Regulating International Data Trans- 11 “ x 914 “ over 30 million computer data bytes. ” mission: The Impact on Manag”ng International Business, “’’The Instant Off-Shore Office, ” op. cit., p. 136. Washington, DC, 1984, p. 16. ————. -.. — ..— - —-.——

Ch. 8—Off-Shore Office Work ● 223 .

Despite these problems, U.S. firms have The U.S. Government and the governments found that the Third World presents an abun- of other countries have encouraged investment dance of business opportunities for those will- in developing nations by helping firms to locate ing to assume the attendant risks. Many de- business opportunities, guarding them against veloping countries recognize the advantages the effects of adverse political developments, of permitting foreign investment to enhance and providing attractive business incentives. private sector development. Not only does it At least one American company notes that expand their capital base, but it also provides both United States and foreign government new opportunities for host-country owned assistance was instrumental in the establish- businesses, brings in foreign technology and ment of its data-entry operation in Jamaica. expertise, and provides training for their peo- Of significant importance to the firm was assis- ple, which in many cases is their most abun- tance provided by the Overseas Private In- dant resource. vestment Corporation (OPIC). OPIC is a self- sustaining, profit-making Federal agency (a The host country’s investment policies are component of the U.S. International Devel- also instrumental in attracting off-shore busi- opment Cooperation Agency, which also in- ness. Specific investment incentives differ de- cludes the Agency for International Develop- pending on the country, but various forms of ment) whose mandate is to “mobilize and tax relief and import duty exemptions are com- facilitate the participation of United States’ monly used. The investment incentives pro- private capital and skills in the economic and vided by many developing countries are help- social development of less developed, friendly ful to investors, and their existence is generally countries and areas. To do this, the agency a good indicator of a country’s need for such provides political risk insurance, direct loans investment and recognition of its importance. and loan guarantees, and other service, “All Such incentives may, at the very least, provide an appearance of political stability and (of which) are designed to reduce the perceived stumbling blocks and risks associated with continuity, and an indication that foreign gov- 46 overseas investment. ernments are aware of the need to create favorable business environments for investment “

DIFFERING VIEWS OF OFF-SHORE OFFICE WORK U.S. Off-Shore Companies Some companies have found that productivity off-shore is often higher than in the For the most part, U.S. companies cite sav- United States, and standards of accuracy and ings in labor costs, as much as 75 percent, as employee conscientiousness are generally high- their primary motivation for seeking off-shore 47 er. One company had originally underesti- sites for data processing. None of the com- mated the capabilities of foreign workers, and panies questioned thought that this trend anticipated a standard of performance 70 per- would have a very significant detrimental im- cent of that attainable in the United States. pact on U.S. employment, and some suggested After only 1 year in operation, the company’s it would create many new marketing jobs in 48 foreign employees keyed better than its U.S. the United States. keyers who, on the average, had over 5 years 49 —— seniority over their foreign counterparts. At ‘-Answers were in response to interviews conducted by the least two other companies confirmed the claim contractor primaril~’ at the Miami Conference on the Carib- of higher productivity .50 As noted earlier, high- bean, Miami, Dec. 3-7, 1984. Other interviews were carried out — in New York and Washington in early 1985. Astriab, op. cit, “’Jordan, ;p. cit. “Bechtel, op. cit. ‘13echtel, op. cit.; and Becker, op. cit. 224 Automation of America’s Offices

er accuracy rates for converted data can also Further, it is argued, creating such work off- be obtained abroad because low-labor cost per- shore does not always have a permanent de- mits redundant keying. velopmental impact on poorer countries, because companies always seek areas where wage Another argument raised in favor of off- rates are lower. As a country develops and its shore data processing is that in some cases wage rates rise, companies located there may the work will not be done otherwise. One com- move to still less developed and less costly pany official pointed out that his firm is do- 52 areas in which to operate. ing massive archival work for several major customers. The customers had considered do- Union representatives argue that because ing it in-house, but finding the work too costly, our economy is becoming more heavily depend- they postponed it until they could find a com- ent on information and white-collar work, as pany like his to do it at an economical rate.51 opposed to manufacturing or blue-collar work, and as white-collar work becomes more auto- U.S. Labor Organizations mated, we could be “taking away the last large group of jobs that the economy is supposedly Representatives of U.S. labor unions argue going to have available. ”53 strongly against the movement of data-entry operations off-shore. While the AFL-CIO has Others argue that locating more and more not yet adopted an official position, their gen- jobs off-shore may jeopardize our economic eral opposition to moving any type of work security because: 1) investment in the econ- off-shore is based largely on the following omy is lost, and 2) off-shore operations exist points: in environments that cannot be controlled, thereby making the investments vulnerable ● The creation of off-shore work represents to adverse political developments. The con- a direct displacement of U.S. workers tinued relocation of work out of this country which is detrimental to our domestic em- is economically unsound because we are fore- ployment situation, and does not always going opportunities to create domestic jobs have a permanent, positive effect on the and new business enterprises.54 Also, our de- development of needy countries. pendence on foreign labor further diminishes ● Labor competition for jobs based on wage the ability to function economically and inde- rate differentials is not fair or equitable, pendently, and, therefore, weakens the United and is inherently exploitative of labor in States. There have been repeated nationaliza- less developed nations. tions of U.S. investments abroad in recent ● Moving operations of any kind off-shore years. Off-shore office work is particularly reduces effective control of our economy, worthy of special consideration: and threatens our economic security. What (we’re) doing now with shipping jobs U.S. labor organizations argue that for every overseas (via the use of) electronic transmis- job created off-shore, one is lost in this coun- sion. . . is making (companies) even more vul- try. Exporting clerical work to low-wage coun- nerable. Work that they have to have for tries is the latest phase in a trend that has (their) company to function, they are placing been going on for a long time in U.S. manufac- outside the realm of their control. In terms turing industries. While the number of people of control, what do you do if you’re not employed in off-shore offices has had, as yet, no discernible impact on U.S. labor, this -Chamot, op. cit. This argument is also presented in The Electronic Sweatshop: The Use and Misuse of Work Stations should not preclude our taking steps to stop in the Home, a presentation given by Dennis Chamott and John this trend. 1,. Zalusky to the National Executive Forum: Office Work Sta- tions in the Home, November 1983. “’Chamot, interview, “Barbara Hutchinson, Director, Women’s Bureau, AFI,- — CIO, Washington, DC, personal interview, Washington, DC, “Bechtel, op. cit. NOV. 19, 1984. Ch. 8—Off-Shore Office Work ● 225

duplicating that system here, and that sys- countries know little about the phenomenon, tem shuts down?55 but are eager to learn more about it. Off-shore offices would be very easy to shut The work is labor intensive, requires only down, because they tend not to be very large, a moderate capital outlay, and can generate do not have a major impact on host country employment rapidly. It is a “clean’ industry, economies, and are heavily dependent on vul- without the heavy equipment, large space re- nerable communication and transportation quirements, and pollution often associated networks. with other industrial enterprises. The industry provides, at the very least, rudimentary Foreign Government Officials training in computer use—a rare opportunity for workers in less developed nations. Finally, The direct impact of off-shore data entry on it establishes a foundation on which further increased employment in developing countries advancement in computer-related industries may be significant and quite rapid. One com- such as software development, technical serv- pany began interviewing prospective employ- ices, and data transmission may grow. The Di- ees in Barbados in May 1983, commenced rector of the Barbados Industrial Development training on August 1, and began production Corporation (BIDC) elaborates: in October of the same year. The operation 1 know from experience in Barbados . . . presently employees 275 people, 80 of them that we can offer a lower cost location (for managerial, technical, and supervisory person- the industry), and answer the needs of many nel. This suggests that keying operations, espe- industrial companies in the United States. I cially larger ones, may provide significant job know too that the countries in the Caribbean opportunities not only for clerical workers, but can benefit from increased employment, and also for more highly trained workers. The same in the case of off-shore keypunch operations, this can be fairly rapid. And I also think we firm let approximately $1 million in contracts can benefit from technical education which to local firms to refurbish its building. Thus, would ultimately set us on the path to higher business opportunities and jobs may also be levels of technology in the computer services created in other economic sectors. industry .57 Reactions of foreign government officials to Barbados has targeted information services off-shore office work are very positive. Those as an industry group that is expected to have countries that already host such operations a major impact on the objectives of the Bar- are pleased with the results, while those that bados Industrial Development Corporation do not yet have such operations want them. and the Barbadian economy. According to its In an informal survey, representatives from 1983-87 Development Plan: more than 20 Caribbean and Central Amer- ican countries unanimously claimed that such The Information Services industry can be expected to generate substantial employment investment projects would aid their economies 56 in the short term . . . linkages with the more and would be welcomed. technically proficient computer industry . . . Barbados has gone so far as to single out will be sought as a means of expanding the information services as a sector to receive ma- sector’s contribution to the economy . . . Lo- jor emphasis for development. At the other cal participation in the Information Services Industry can come about through the estab- end of the spectrum, representatives of some lishment of service bureaus to perform off- — shore data processing for North American 58 Ibid. companies. ‘ Answers were in response to informal interviews conducted by the contractor at the Miami Conference on the Carib- bean, Miami, Dec. 3-7, 1984. Representatives of approximatel~’ Gollop, op. cit. 20 Caribbean and Central American countries were queried, ‘Ilarbados Industrial De\relepment Corp., Industrial De\’el- Astriab, op. cit. opment Plan, 1983-1987, 13ridgetown, Barbados, 1983. 226 ● Automation of America’s Offices .

Development officials interviewed for OTA and are not in need of the job opportunities all agreed that foreign data-entry workers view that result from such investment. their jobs and status in a considerably more Some experts favor investment in develop- positive light than their American counter- ing country private sectors as opposed to just parts. While keying in the United States is public-infrastructural development projects.” sometimes pictured as a low status, boring job, According to this argument, in many cases foreign workers often consider it a gateway developmental aid programs have not achieved to opportunities that did not formerly exist their intended purposes. For example, while (as do many minority workers in the United good roads may indeed have been built, pri- States–see chapter” 12). vate businesses along those roads are neces- Over-dependence of countries on informa- sary for the general advancement of the econ- tion services is not seen as a problem at this omy. While the wages paid to workers in these point because the industry is presently so businesses may be extremely low by U.S. small. In addition, many developing nations standards, this should not be considered ex- opt for diversification of industrial develop- ploitative. ment as a key ingredient of a more stable econ- Rebutting arguments from U.S. labor that omy. They want to avoid heavy dependence on traditional industries such as tourism or the flow of clerical work out of the United agriculture, with their characteristic seasonal States should be stopped, development orga- fluctuations in income and employment. nizations point to the great impetus of increased international economic interdependen- cy and the disadvantages of impeding capital Economic Development Organizations flows. “Business goes where business can be Development organizations are in essence done, ” as one development organization official the ‘middlemen” in regard to the development said, “The flow of capital cannot be stopped of off-shore office work. They view the expan- unless one wishes to control the economy, and this runs against the whole tradition of free sion of the sector in the much larger context 62 of economic development, are supportive of trade. its growth, and reaffirm the arguments put Answering U.S. labor’s claim that wage com- forth by U.S. companies and foreign govern- petition is the only focus when selecting busi- ments in favor of such growth. “The sheer ness sites, a development official countered number of jobs (off-shore data processing) cre- that it has never been a case of just wage rates: ates is the main attraction of the industry in “If that were the case, there wouldn’t be a bit the view of developing countries, ” says one of work done but in China and India. 63 While official of a private, nonprofit development this is, of course, an overstatement, higher organization .59 profits are not the only motivation for many This development expert claims that nega- businesses off-shore. For some, it may simply tive reactions, if any, in developing countries be a matter of survival. Viewing the exploita- usually come from the more educated sectors tion argument in a different light: and the labor movement, or, as he put it: “peo- 60 You will certainly get cases of exploitation, ple who are not worried about having a job. but it is far more exploitative to say (that Those citizens of developing countries who we will) keep those jobs here, and pay an un- view U.S. investment as exploitative are those acceptably high level of wage which will make who are generally of higher economic status our products unacceptable anywhere other than in our own economy. Plus, by doing so “’Gordon Hunt, Director, Investment Services, Carib- bean/Central American Action, Washington, DC, personal interview, Washington, DC, Dec. 18, 1984. This claim was also ‘] Ibid. affirmed by Gooch, op. cit. “Ibid. “’Ibid. “Ibid. Ch. 8—Off-Shore Office Work ● 227

we will ‘starve’ (the people in less developed Do you employ those people in their own countries). 64 countries or do you employ them (in the There has been massive legal and illegal im- United States)?, because that’s where they’re all coming. Do they come up here and work migration to the United States from the Carib- illegally for sweatshop wages , . . or do they bean. Many countries in the region have their stay in their own countries, where they would second largest, and in some cases their largest rather be to begin with if they could make population centers in the United States. Some a decent wage?65 see it in the best interest of the United States to create jobs for people in their own countries to stem this tide of immigration: ———- “Ibid. Ibid.

PUBLIC POLICY ISSUES Off-shore office work does not have a signif- imposing regulation on the types of data icant influence on the U.S. economy at present. that can be imported, Only a few dozen firms and a few thousand imposing restrictions on the hardware and employees are involved. Nevertheless, it could software used off-shore, grow. If domestic wage rates remain compara- using taxes to discourage off-shore work tively high and telecommunication and trans- or encourage that work be done domes- portation costs continue to fall, market forces tically, and/or will encourage more firms to investigate the imposing restrictions on the use of pri- off-shore alternative. Growth could be quite vate telecommunication lines. rapid, at least in the short- to medium-term future. Regulation of Data In the long term, technological advances in Many nations have imposed restrictions on input technology, especially optical scanning, transborder data flows for the purpose of pro- are likely to undermine the cost advantages tecting the privacy of their citizens, for exam- of off-shore data-entry work. Thus, off-shore ple, prohibiting transmission of name-linked offices are likely to be a temporary phenome- information to countries with less stringent non, unless some other technological advances privacy laws. or economic conditions make it feasible to move other types of office work off-shore— The United States has data protection laws for example, telephone reservations or order designed to restrict the uses of name-linked processing. data and assure access to the data by persons referenced in them. These laws do not, how- Assuming that it is temporary, the question ever, address the “front-end’ issue of how or remains how U.S. public policy should deal where information may be entered into elec- with off-shore offices. The alternatives include tronic databases. Nor does U.S. law restrict prohibiting, regulating, or encouraging it. the flow of data across international borders. Regulating or Prohibiting It is not clear that privacy protection is nec- Off-Shore Offices essarily a good motivation for U.S. regulation of off-shore offices. Even if it were, the enact- Methods for limiting the growth of off-shore ment of privacy protection laws governing offices could include such government actions transborder data flows would affect other in- as: dustries, such as banking, and the internal 228 ● Automation of America’s Offices operation of many multinational corporations, industry, and U.S. computers and modems are as well as off-shore keyers. already usually the equipment of choice for off-shore firms. A more direct approach to discouraging establishment of off-shore offices is to simply Taxation Alternatives designate data entry as a phase of processing that U.S. companies must, in virtually all cir- In theory, duties could be imposed on the cumstances, carry out within our own borders data that is keyed off-shore and subsequently if the data is destined for eventual sale. This imported into the United States by physical would, in effect, constitute a local content re- or electronic means; the data could be treated quirement. as a commodity or primary good imported for consumption. Alternatives might be to levy Because such a requirement implies that the duties on the labor value added to data keyed data being entered is a commodity, this type off-shore, or to impose a trigger price tariff of restriction may not be applicable to certain that would keep the price of off-shore keying types of data—e.g., revenue, personnel, pay- above domestic levels. roll information, and the like-reserved for the exclusive use of a business, and not meant to In practice, however, levying any such tariffs be sold. “Buy national” requirements could would be fraught with difficulty. First, this fill this gap by mandating that off-shore data shotgun approach to regulation would prob- entry could not be resorted to unless domes- ably affect all data importers, of which off- tic alternatives were unavailable. Brazil and shore keyers area very small minority. In addi- Canada for example, have imposed regulations tion, a method for determining the value of that require certain phases of data processing data would have to be developed. Value might to be conducted within their own borders.66 be related to proposed end use or might be based simply on the basis of the volume of If viewed in a broad context, however, im- data imported (e.g., a duty might be levied for position of such regulations may serve to stim- every kilobyte—one thousand characters-of ulate reciprocal actions by other countries. data). The latter seems inherently inequitable, Thus, more harm could be done to the U.S. since some kinds of data are much more valu- data processing industry than could be coun- able then others. The former seems nearly im- ter-balanced by benefits of restricting a par- possible to enforce, unless customs officials ticular phase of data processing to our own are going to play back and analyze every com- shores. puter tape. Restrictions on Hardware and Software Imposing duties on data imported via tele- In lieu of limiting the kinds of data that could communication presents even more onerous be entered off-shore or requiring that data en- technical and political problems. The sheer vol- try be carried out domestically, requirements ume of transmissions to the United States and that U.S. equipment be used could be imposed. the many routes they may follow present lo- In essence, this would constitute another “buy gistical problems of inestimable proportions national’ requirement. This might effectively for monitoring. In the future, the increased preclude the establishment of keying opera- use of direct satellite links between off-shore tions in some countries, since, as previously installations and domestic offices will make the imposition of border controls on data flows mentioned, foreign communications author- 67 ities often monopolize telecommunication equip- extremely difficult, if not impossible. ment markets and require that their locally In any case, it seems clear that on-site mon- manufactured equipment be used. However, itoring by government authorities and/or wire- many countries do not even have a computer tapping on a grand scale would be necessary “Joan E. Spero, “Barriers to International Information Flows, ” Telecommunications, November 1983, p. 68. “-Ibid. Ch. 8—Off-Shore Office Work ● 229

to police electronic data flows. Even if this were might be achieved by imposing stiff tax penal- technically feasible, it is doubtful that reve- ties or surcharges on data-entry firms leasing nues accrued by a government could justify such lines. the efforts made to collect them. Several countries already use this strategy Putting technical and economic considera- to protect their internal data processing in- tions aside, moves toward monitoring data dustry and it is quite effective in curtailing flows in the United States would undoubtedly undesired activities. In Japan, the Ministry encounter many political obstacles. The prac- of Posts and Telecommunications, through the tice would cast a clear shadow of authoritari- international telecommunication authority, anism, and have a very inhibitive effect on busi- KDD, kept two large U.S. data processing ness and communications in general. A far firms out of the country’s market by first deny- greater purpose than stifling a minor indus- ing them dedicated lines, and then restricting try would obviously be in order if the practice their use so that the firms could not market were adopted. In sum, while the objective to all of their services.” The Deutsche Bundepost curtailing off-shore keying could readily be at- in West Germany requires users of leased lines tained through tariff legislation, a more tightly to use the public-data network. In 1982, the focused approach would seem more appro- authority declared that it would permit the priate. use of international leased lines only if some phase of data processing were conducted in Restrictions on Dedicated Germany before data was transmitted out of Telecommunication Lines the country.69 Brazil has enacted many restric- Limiting the availability of leased private tions on the use of leased lines. For instance, telecommunication lines to off-shore keying firms may not use them to access databases operations or prohibiting their use for this pur- located outside the country.’” pose would unquestionably deter the estab- Short of limiting access or prohibiting off- lishment of such operations, because it would shore data-entry companies from using leased directly effect one of the lifelines of the indus- lines, legislation could require telecommuni- try. Since leased lines appear to be the most cation carriers to impose usage-sensitive rates cost effective way to transmit large volumes on these firms. A number of foreign govern- of data across international borders, off-shore ments have expressed interest in usage-sen- keyers relying predominantly on telecommu- sitive rates, since they fear the loss of reve- nication capabilities to operate would be acute- nues that could result from reduced use of their ly effected by any such restrictions. public networks.” One international data proc- Regulations of this sort could, of course, be essing service estimated that the introduction of usage-sensitive rates would raise its oper- applied only to the U.S. side of any communi- 72 cation link (e.g., the down-link from a satellite ating costs by 700 percent. In the face of such sending data to the United States, a terres- cost increases, many off-shore data-entry firms trial cable in U.S. territory, etc.), since the for- would probably have to close up shop. eign ends of such links are out of American Regulations on leased lines could, therefore, jurisdiction. Nonetheless, this strategy could offer a relatively “clean” approach toward dis- be effective since the regulations could be ap- couraging off-shore keying; impeding other plied specifically to off-shore data-entry firms types of data flows could be avoided because without impinging on the rest of the data proc- restrictions could be tightly focused. To be essing industry. — Restricting access to dedicated lines might ‘‘Spero, op. cit., p. 68. be accomplished by specifying a limitation on ‘ ‘Ibid. Ibid. the number of lines available to off-shore key- ,Jussawal]a and Cheah, op. cit.. p. 292. ers in different regions. Implicit limitations Spero. op. ci~., p. 68. 230 ● Automation of America’s Offices — truly effective, however, such restrictions would munication and customs regulation already fa- probably have to go hand-in-hand with some vor the growth of this industry. Inaction will form of customs regulations so that control undoubtedly assure the continued export of could be extended over firms who import data data processing work for so long as the mar- recorded on magnetic media. ketplace provides the needed incentives. Further encouragement might be achieved Encourage or Do Nothing About through increased activity of international de- Off-Shore Office Work velopment agencies. For example, the Over- seas Private Investment Corporation could Encouraging off-shore offices is discussed make more loans available and otherwise step in the same section as a “do nothing alterna- up efforts to help U.S. firms find suitable loca- tive” because the current status of telecom- tions and establish keying operations off-shore. Chapter 9 The Automation of Federal Government Offices Contents

Page Federal Procurement and Acquisition of Office Automation ...... 234 The Three Phases of Federal Office Automation ...... 234 Laws and Policies ...... 235 The Federal Inventory of Office Automation ...... 238 Acquisition Strategies and Problems ...... 239 The Dilemma of Procurement Policy ...... 241 What Will Office Automation Mean for Federal Office Productivity? ...... 242 Evaluations of productivity ...... 242 Incentives ...... 243 Implications for the Federal Work Force ...... 244 Size of the Work Force ...... 244 Changes in the Mix of Federal Jobs ...... 246 Shifts Among Occupational Categories and Grade Levels ...... 246 Unanswered Questions...... 250 Part-Time and Temporary Workers ...... 251 Women in the Federal Work Force ...... 252 Quality of Worklife...... 252 Labor Management Relations and Federal Unions ...... 254 International Comparisons ...... 255 Effects of Office Automation on Public Services ...... 256 A Case Study of Expanding Responsibilities ...... 256 Changes in the Nature of Delivered Services ...... 258 Effects on Governance ...... 258

Figures Figure No. Page 9-l. Paid Civilian Employment of the Federal Government, 1881-1983 ...... 245 9-2. Changes in the Distribution of Federal Employees by Occupation, 1975 and 1983 ...... 247 9-3. Change in Distribution of Federal Employees by Grade Levels, 1974-80 . . . . 248 9-4. Distribution of Federal Employment by Grade Level 1975 and 1983 ...... 249 9-5. Full-Time White-Collar Employment in the Federal Work Force by Grade Level and Sex, 1974-75 and 1983 ...... 253 Chapter 9 The Automation of Federal Government Offices

Automation of Federal Government offices tion in the effort to increase efficiency. Some is generally keeping pace with automation in experts say with equal confidence that gov- the private sector. The effects are likely to be ernment offices are behind the state-of-the-art. at least as significant in government offices Comparisons based on many case studies how- as in corporate offices. But the forces that drive ever indicate that while some large corpora- change are not the same, and the consequences tions are far ahead of Federal agencies in using will not necessarily be the same. Government information technologies, the government is is not business, although it is often argued at least keeping up with the private sector as that it should be business-like in its approach a whole. Among major institutional sectors to delivering services. it has been the largest user of computer-based information systems.3 Federal office automation is preceding on the reasonable assumption of significant ben- Some agencies are behind their closest pri- efits. Large investments of public resources vate sector counterparts. For example, the Fed- are involved, and most Federal employees will eral Reserve Board does not compare with lead- be affected. Thus, a close look at the potential ing financial institutions in terms of either consequences of Federal office automation is advanced applications or the proportion of crit- merited, ical work that is automated. On the other hand, The Federal Government is in effect the Na- some agencies are at the frontier in specific office automation applications; International tion’s largest office. It occupies 2.6 billion Revenue Service (IRS) is one example. Most square feet of office space; it has 332 accounting systems and over 100 payroll systems; and agencies are in the mainstream in terms of it employs about 1,7 million white-collar penetration and in terms of advanced applica- 1 tions of hardware and software. ’ workers. Federal agencies were among the first insti- Opinions vary widely as to how well and how tutions to adopt large computers. In the last rapidly the Federal office is being automated. few years, they have been adding small com- One trade journal concluded that “government is pioneering some leading-edge office auto- puters and word processors to augment their large-scale data processing. For the next few mation programs and in many respects is years, a major trend will be the linking of ahead of the private sector because the Rea- microprocessors, mainframe computers, and gan Administration is emphasizing automa- other devices into integrated office systems; and the networking arrangements that will It is in fact surprisingly difficult to ascertain how many connect office to office, headquarters to field white-collar Federal employees there are, or indeed how many Federal workers there are in all, at any one time. The Office of Personnel Management, the Bureau of Labor Statistics, and ‘Office Administration and Automation, September 1984, the Bureau of the Census all publish figures, but they are nevrer p. 56. the same figures. The total given varies widely depending on ‘John Leslie King and Kenneth L. Kraemer, “ Information the time of year or month; or whether it is a monthly average Systems and Intergovernmental Relations, ” Public Sector Per- or an estimate or a survey; or whether and how the count treats formance, Trudi C. Miller (cd. ) (Baltimore: The Johns Hopkins temporary workers, part-time workers, intermittent workers, University Press, 1984), p, 103, postal workers, census takers, CIA and NSA workers, congres- ‘This judgment is based on materials supplied by Federal sional employees, judicial-system employees, student interns, agencies and comparisons drawn from the literature and from fellows, etc.; and on how many of the approximately 106 pay OTA contractor case studies; and specifically, on the conclu- plans OMB chooses to count. All of these are traps for the un- sions of an OTA contracted report by The Educational Fund wary analyst. for Individual Rights.

233 234 Automation of America's Offices

offices, and Federal agencies to external sys- and structure of the civil service, and what tems and databases. are the implications for recruitment, classification, and retention of Federal work- This section looks briefly at the effects of office automation that can be detected now, ers and for budgetary and personnel policies? and the effects to be expected over the next ● What are the implications for career ex- 15 years. After a discussion of Federal procure- pectations and opportunities of Federal ment and acquisition policies with regard to white-collar employees? office automation, the rest of the chapter looks ● How will automation affect the quality in succession at the following questions: of their working environment? ● Are there major problems in Federal ac- ● Will automation affect the relationship of quisition of information technology? government and citizens—will it change ● Will automation make Federal offices the availability or quality of government more efficient, or more productive? services? ● If so, can that benefit be translated into ● Could it affect the exercise of authority, lower labor costs, and lower Federal accountability, responsibility, and the qual- budgets? ity of decisionmaking? ● What are the potential effects on the size

FEDERAL PROCUREMENT AND ACQUISITION OF OFFICE AUTOMATION It is the declared policy of the present Ad- ministration that information is an economic The Three Phases of resource and should be managed efficiently. Federal Office Automation The emphasis has been on reducing the cost The adoption of mainframe computers in the of information-handling rather than on increas- late 1950s5 led almost immediately to devel- ing information services. opment of large centralized-computer centers. Federal agencies have had wide latitude in The Office of Management and Budget (OMB) making decisions about office automation. The and the General Services Administration (GSA) policy has been to keep governmentwide re- were soon given governmentwide authority quirements and restrictions to a minimum. over automatic data processing (ADP) policy Critics charge that this has led to uncontrolled and standards. During the 1960s and 1970s proliferation of small computers, and that the many of the major activities of government lack of compatibility among them is prevent- became dependent on computers for manage- ing the realization of expected benefits of auto- ment functions such as planning, program con- mation. On the other hand, overly detailed and trol, financial and payroll operations, procure- rigid specifications in procurement of major ment control, auditing and inspection, and information systems, including local area net- other government functions. The acquisition works, is said to preclude vendors from find- process was framed around centralized ADP ing innovative ways to meet government needs, and to result in purchase of equipment that is already far behind the state-of-the-art ‘The first general data processing computer, UNIVAC I, when it is installed. was acquired by the Bureau of the Census, in 1951. Ch. 9—The Automation of Federal Government Offices . 235 and the communication functions that were Some large Federal computers are, however, developing in parallel.’ already obsolete or will soon become so.9 “Ob- solete, ” in this case, does not mean that they In the 1980s however the dominant theme are no longer functioning, but merely that more in Federal office automation has become the cost-effective technology is available. The old spread of end-user computing. It is difficult to distinguish the effects of these two phases systems require repeated patching and modification, maintenance costs are high, and spare of computerization since decentralized com- parts sometimes not available. Older computing does not replace, but is superimposed puters sometimes have limited on-line proc- on, centralized computing. Now personal com- essing capacity because they were designed puters and word processors are often net- for 24-hour operation and not for the peaks worked and part of an integrated system. Fed- caused by many end-users. eral procurement policy, and accounting and inventory practices also blur distinctions be- When these computers are replaced, data- tween these two kinds of office automation. bases often have to be converted, and new software packages developed or adopted. This is Most Federal agencies now have word proc- expensive. The incompatibility of equipment essing, spread-sheet packages, automated doc- from many vendors is also causing problems. ument transmission, and calendaring. The other most frequently used functions are electronic filing and computer graphics. Many agency Laws and Policies headquarters communicate by computer with The Paperwork Reduction Act of 1980, Pub- their field offices nationwide.’ lic Law 96-511, was a milestone in government Personal computers are being used more and information management. ’” In addition to re- more by managers and professionals as well ducing the paperwork burden imposed on busi- as by support staff. The National Academy ness by government, the act was aimed at im- of Public Administration, in a 1983 report, as- proving efficiency and effectiveness in the use sumed that this reduces the load factors and of information. It promulgated the concept of utilization rates of mainframe computers, and information resources management (IRM), said that this cast “serious doubt on the fu- meaning the integrated management of all ture role of many of the large central computer basic information-handling activities and func- service centers that have been built up. . . over tions. The sections of the act dealing with the last 10 to 15 years. 8 But experts gener- information-resources management cover every- ally do not believe that ADP centers will be thing from conventional libraries to central- superseded by distributed processing. Rather, ized ADP sytems, and have a direct effect on as small and large computers are linked, the office automation. ADP center will be the locus and guardian of The act required each agency to appoint an the agency data to which all managers and information-resources manager. 11 It charged professionals will increasingly have access and make contributions. ‘The Grace Commission criticized the government for allowing its data processing systems, which in the early 1970s —. were state-of-the-art, to fall behind; according to the Commis- ‘ International Data Corp., Procurement Information Man- sion about 60 percent of the government’s then 17,200 com- agement Service, “Federal Acquisition Strategies for Office puters were in need of replacement or significant upgrading. Automation, ” research paper for Continuous Information Serv- However, in a recent review of 100 “major systems, GSA con- ices Clients, March 1983. cluded that only 5 percent are “totally supported by obsolete ‘According to an office automation survey compiled by the ADPE systems, ” and that obsolescence ‘‘is not as extensive Information Management Assistance division of the Office of as has been claimed. ” See Assessing ADPE Obsolescence in Information Resources Management, General Services Admin- Major Federtd S.ywtems, U.S. General Services Administration, istration, November 1984. Thirty-one departments and agen- February 1985. cies responded to the survey. “The act built on the recommendations of the Commission ‘National Academy of Public Administration, I?e~ritzziizing on Federal Paperwork (1975-77). Federal Management: Managers and Their Overburdened S.F’s- “The act specified that these officials should be at the level tems, November 1983. of Assistant Secretary. Since the number of these positions (continued) 236 ● Automation of America’s Offices

OMB, assisted by GSA, with reviewing infor- thority is premised on large-systems procure- mation resources management in each agency ment it remains the basic authority for pur- at least every 3 years. OMB has largely dele- chase of office automation equipment. If office gated this responsibility to GSA. ’2 In prac- equipment contains data processing compo- tice, each agency conducts its own review, for nents it must be bought under GSA stand- which GSA provides a voluminous handbook ards and rules governing competitiveness in or set of guidelines. The agency reviews are procurement. Procurements of microcomputers then reviewed by GSA. and word processors, 16 when under $300,000, are handled under a GSA schedule (Schedule OMB has stated two basic tenets that gov- C), which means that there are simplified pro- ern its approach to information-resources man- 13 cedures for competitive bids from already au- agement: thorized vendors. When the total value of a ● Information is an economic resource and procurement exceeds certain thresholds (for should be managed in the same way that ADP equipment in general it is now $2.5 mil- other economic resources are managed. lion) GSA usually issues to the agency a Dele- ● Information-resources management should gation of Procurement Authority, based on entail the management of the total infor- information provided by the agency about the mation life cycle from collection to dis- justification for the procurement. The agency semination. then draws up specifications and goes through its own competitive bidding procedure. (GSA OMB provides guidance on all matters of can withdraw this delegation or change the budget allocation and procurement in Federal thresholds.) GSA acquisitions do not account agencies, but this guidance is not specific for all, or even for the preponderance of, Fed- enough to materially affect the acquisition of 14 eral-agency microcomputer acquisitions. office automation equipment. GSA does provide guidance to agencies on this subject, al- The Competition in Contracting Act17 that though agencies still make their own basic de- took effect April 1, 1985, created simpler pro- cisions. cedures for using GSA’s ADP Schedule in microcomputer purchases under $300,000. Twenty years ago, in 1965, the Brooks Act GSA has an approved list of 45 microcom- (Public Law 89-306) gave GSA sole authority puters, available from 36 suppliers at special to procure ADP systems. ’5 Although this au- Federal rates. In addition, a GSA Computer Store carries 15 brands (not necessarily on the in each agency is limited by law, the responsibility was generally given to the Assistant Secretary for Administration or list); this is designed to encourage the selec- the equivalent. These are now referred to as Senior Designated tion by end users rather than leaving the choice Officials or SDO’S, and there is typically an Office of Informa- to an agency’s central-purchasing agent. GSA tion Resources Management under them, with a director who acts as the IRM and represents the agency on the Interagency has published several attractive booklets of Committee on Information Resources Management. There is an Office of Information and Regulatory Affairs in OMB that coordinates OMB responsibilities for implementation of the Paperwork Reduction Act. a mission-critical computer resource system then it is also ex- “Letter of delegation of June 13, 1983, and Temporary empt from GSA procurement regulations. Statement of Un- Regulation 10. dersecretary of Defense DeLauer on Mar. 4, 1983, according “Executive Office of the President, Office of Management to International Data Corp., op. cit., p. 22. The question of and Budget, Improving Government Information Resources whether this applies to word processors has been under review Management, March 1982, p. I, hereafter cited as EOP/OMB 1. several times and the outcome is not clear. “0MB guidance on procurement (which comes from the “)Word processors were not included under ADP equipment “M” or management side of OMB, and specifically from the until late 1983 (SPMR Temporary Reg. F500, Oct. 25, 1983). Office of Federal Procurement Policy or OFPP) is of course ‘“Part of the Deficit Reduction Act of 1984. The CIC Act, to be distinguished from OMB review of agency budget requests aimed at increasing competitiveness in procurement, makes on the “B side of OMB, which certainly does affect the level it more difficult to buy from a preselected sole source, but de- of office automation procurements. fines as competitive, awards that are made under a GSA Multi- “’DOD computers and related devices were exempted if the Award Schedule Program such as the ADP program. An agency equipment was “a mission critical computer resource. ” DOD may also exclude a specific vendor in the interest of maintain- has argued that if any office automation system is tied into ing alternative sources. Ch, 9—The Automation of Federal Government Offices . 237 advice to help agencies in buying and manag- Accounting Office (GAO) has general auditing microcomputers.18 ing power over all government expenditures and has repeatedly evaluated office automa- GSA also has responsibility for most of the tion acquisition programs. many common-user telecommunication facilities used by Federal civil agencies. If an The President’s Private Sector Survey on agency wants to make a major change in com- Cost Control (the Grace Commission), which mon-user services (e.g., Wide Area Telephone was highly critical of government management Service, or WATS, lines) to implement office procedures, asked, “Can improvement of in- automation communications, GSA must ap- formation systems create cost savings and prove.]’ efficiencies and facilitate managerial decisionmaking throughout the Federal Government?”23 The GSA authority under the Paperwork Re- The report concluded that it could, and that duction Act (and by delegation from OMB) this offered the “opportunity for savings and was until recently exercised through two differ- revenue of $15.2 billion over 3 years, an esti- ent services. The Automated Data and Tele- mate that included both office-microelectronic communications Service, which dealt with equipment and large systems. The survey team ADP equipment, and part of the National Ar- said that the acquisition process was inade- chives and Record Service, which dealt with records management, micrographic, and word quate, characterized by excessive procedural steps, a confusing array of policies and direc- processing equipment, have been merged to tives, lack of qualified personnel, and deficient create the Office of Information Resources 20 training and supervision. The survey team rec- Management. ommended stronger, centralized, govemment- In April 1984, a number of policies and reg- wide policies for information-technology ac- ulations related to information resources and quisition and management, but not necessarily technologies were consolidated in a Federal less discretion for the agencies, although it is Information Resources Management Regula- not clear how both objectives can be preserved. tion (CFR Pt. 41, ch. 201). Amendments to The Administration has stressed the impor- the Paperwork Reduction Act have been in- tance of planning, and OMB, GSA, and the troduced in Congress aimed at strengthening 21 National Bureau of Standards together pre- some aspects of the law. pare a 5-year plan, updated every 2 years, to- Other agencies have roles in office automa- gether with guidelines to assist agencies in tion procurement. The Institute for Computer planning. A new OMB circular, 85-12, will pro- Science and Technology in the National Bu- vide agencies with further guidelines to be used reau of Standards develops standards for ADP in planning. Agency managers, however, often and communications equipment, develops tech- express a feeling of futility in doing long-range nical guidelines, and prepares a yearly fore- planning for information systems because their cast of developments in computer technology, budgetary constraints are constantly chang- including office automation. 22 The General ing. Nevertheless, the desire to link personal “office of Information Resources Management, U.S. Gen- computers and word processors to mainframes eral Services Administration, Managing End User Computing and minicomputers, and to other devices, is in the Federal Government, June 1983, and End User Guide pushing Federal agencies toward planning and to Bu.ving Small Computers, August 1984, “DOD manages its own procurements of communications coordination of equipment acquisition, prob- technology. ably more effectively than could be done by “’Another part of GSA’s National Archives and Records instituting government-wide requirements. Service became the independent National Archives and Records Administration. -’S. 2433 (amendments of 1984); H.R. 2718 (amendments of 1983); hearings were held in the House in April 1983 and in “The Executive Committee to carry out the survey was the Senate in April 1984. established by Executive Order 12369, June 30, 1982. See: Presi- ‘-Recent budget cuts have abolished the planning office of dent’s Private Sector Survey on Cost Control, Management ICST, leaving in doubt the question of whether these forecasts Office Selected Issues, vol. VII 1, ‘‘Information Gap in the Fed- will be done in the future. eral Government, winter 1983. 238 Automation of America’s Offices

The Federal Inventory of In recent years, the largest absolute increases Office Automation in expenditures for information technologies have been in the Department of Defense (DOD), Expenditures for information technology for the Department of Energy, and the Depart- Federal agencies grew from about $10.4 bil- ment of Health and Human Resources. But lion in 1983 to $13.9 billion in fiscal year 1985, a number of small agencies that had lagged increasing 19 percent in the first year and 13 behind have had bigger percentage increases percent in the second.24 This is a much larger in order to catch up with the pace; for exam- growth than that for Federal expenditures as ple, the Office of the U.S. Trade Representa- a whole. About a third of these expenditures tive (USTR), the Department of Justice, and are for defense-related agencies. the Securities and Exchange Commission. The government has been spending about DOD is by far the largest user of office auto- 1.4 percent of its budget on information tech- mation among Federal agencies with about 67 nology; this is perhaps somewhat less than percent of the stock. DOD however also has the rate of spending by private corporations the largest share of all Federal white-collar in the services and manufacturing sectors,25 workers (about 40 percent of them). One meas- in spite of the greater intensivity of whitecollar ure of the extent to which an agency has auto- work in government (about 80 percent of the mated is the comparison between its share of Federal work force are white-collar workers, total Federal office automation, and its share compared to about 55 percent of the total ci- of the Federal whitecollar work force. The ra- vilian work force). The average length of time tio of DOD’s share of automation to its share in service for Federal computers in 1982 was of the white-collar work force is a modest 1.68 just under 7 years, and decreasing as old sys- compared to 8.24 for the Department of State, tems are replaced. 3.41 for the Environmental Protection Agency, and 3.34 for the National Aeronautics and The purchase of equipment (capital invest- 27 ment) accounts for only about 19 percent of Space Administration. these expenditures, compared to 36 percent In 1982, the Federal Government had in its for commercial information services (ADP, computer inventory about 13,667 major sys- etc.). The rest is for equipment leasing or rental tems with over 20,000 central processing units. and for personnel costs. Federal policy has gen- This inventory is not complete nor accurate.” erally been to encourage purchasing rather Moreover, GSA will no longer attempt to list than leasing; it is more cost effective, and the systems costing less than $50,000, and has proportion of systems that are leased has de- recently discontinued its tracking of commu- clined from 36 percent in 1970 to 12 percent nications use and costs. It is therefore impos- at present.26 But some procurement specialists sible to say how much office automation equip- question this strategy since leasing would ment the government owns. In early 1983, the make state-of-the-art technology more read- General Service Administration said that ily available. “there are estimates” of 82,000 word proces- ——— —-— - .- - ‘q Internat~onal Data Corp., op. cit. These percentages are “Office of Management and Budget, General Services Ad- for 1982-83; more recent figures are not available. ministration, and Department of Commerce, A Five-Year Plan ‘“GSA, Automatic Data Processing Inventory, April 1984. for Meeting the Automatic Data Processing and Telecommu- GSA guidelines require agencies to report all systems with a nications Needs of the Federal Government, vol. 1, April 1984. CPU but agencies nevertheless differ on their interpretations Hereafter cited as Five Year Plan, 1984. of the guidelines-e. g., some do not include word processing “’Thomas G. Cody, “How Senior Execs View Info Technol- systems and some do. An on-line version of the inventory is ogy, ” Government Computer News, July 1984, p. 64. being developed, but it will not include systems costing less “In 1960, over 80 percent of computer systems used in the than $50,000. GAO concluded in March 1985 that “GSA’s data Federal Government were leased; by 1970 this had dropped base of the government’s inventory of computer equipment has to 36 percent, from 1977 to 1983 it was about 9 percent, and been inaccurate for some time. ” (U.S. General Accounting Of- since then it is rising again, to 12 percent in 1984. Five-Year fice, Effective Management of Computer Leasing Needed to Plan, 1984, pp. 1-3. Reduce Government Costs, IMTEC-85-3, Mar. 21, 1985, p. 11 1). Ch, 9—The Automation of Federal Government OffIces . 239

sors in government offices,29 but these esti- Acquisition Strategies and Problems mates were based only on old rules-of-thumb about government’s share of computer pur- Within OMB and GSA guidelines each agen- chases. Most agencies are not sure how many cy makes its own decision about office auto- personal computers or small word processors mation acquisition. OMB Circular A-109 re- they have. Accounting and inventory catego- quires every agency to have an acquisition ries differ across agencies in how they catego- strategy; some of these strategies have been 31 rize leasing arrangements, paced payments, widely criticized. A series of GAO reports 32 etc.30 Agency IRM officials nevertheless com- has faulted agencies for: plain about surveys or audits aimed at clarify- not complying with guidelines and regu- ing these questions; audits are seen as a heavy lations, burden that detracts from more productive not studying alternative methods of ac- work. quisition, Much of the office automation equipment leasing rather than purchasing, now being bought is low cost; decisions about using vendor-specific programming lan- personal computers are in this sense not much guage, not adequately analyzing agency mission different from decisions about desks and typewriters. Over-elaborate regulations and con- and needs, trols could be needlessly costly. Organizations failing to have a long-range plan, need the freedom to experiment in order to not consolidating individual small-volume identify the most useful technology for them. orders, However, monitoring and inventory could be purchasing equipment in excess of need done without affecting the range of choice. or likely use, failing to properly inventory equipment, Current procedures for inventory of office lack of accountability in controlling automation equipment make it difficult to as- equipment, sess the status, l;evel of capital investment, and failing to issue or enforce departmentwide rate of investment. Projections of future office policies, automation, future costs, and future benefits not separating short-term objectives from are therefore unreliable, and effects hard to long-range plans, measure. This is a problem for agency plan- failure to use word processing to reduce ners and decisionmakers trying to assess the the cost and size of the work force, cost-effectiveness of automation. faulty cost/benefit analysis, not realizing maximum productivity gains, underestimation of operating and maintenance costs, and use of untested technology.

‘

Noncompatibility the office furniture is arranged, to what else has to be done at the same time. Hardware, Some of the most difficult decisions about software, or auxiliary furniture can improve acquisitions strategies involve the value of this workflow or it can disrupt it, depending compatibility of small systems and devices. on characteristics that may appear unimpor- Some Federal executives insist that it is most tant or irrelevant to those who are not actu- important to get office equipment that is use- ally doing the work. ful now; diversity will help the agencies determine what kinds of automation are most suc- The Complexity of Options cessful. Noncompatibility is a minor problem, they say; by the time it becomes cost-effective The procurement of networking technologies to tie systems together, it will be time to buy involves much higher costs and longer-lived new up-to-date equipment. The experience and systems than the choice between stand alone learning gained meanwhile will carry over. devices. Mistakes are more serious. Even in procuring simple systems, the procurement op- This seems to be a minority position. The tions are becoming complex. To get a telephone tying together is already going on, and for system for a new office, the Federal executive most agencies noncompatibility is certainly must now choose between buying and leasing. a problem. However, this problem may be an If the budget only has operating funds, not unavoidable cost of competitive procurement. capital investment funds, lease financing is Moreover, cumbersome attempts at coordina- necessary .33 tion and control during the first few years of personal computers would almost certainly Privatization have greatly delayed the automation of Fed- An agency’s evaluation of its needs for com- eral offices and put the government far behind puters and related equipment has also been the private sector in the pace of adoption. complicated by confusion over Administration Because the government is a major market policy about contracting with private organi- for office automation, it is often urged to force zations for information-related services. OMB the development of industry-wide standards, Circular A-76 requires the contracting out of or to develop its own standards. Many experts services that can be performed more cheaply think however that since the development of by the private sector. Many agencies have con- voluntary standards is proceeding, it would tracted for data entry or word processing to be preferable in the long run for government relieve the load on old systems and avoid the not to force this issue by intervening more need for new systems. Some have become de- strongly. There appears at present to be little pendent on outside sources for training and pressure for such intervention. support of office automation instead of developing the capabilities that they will need in Inappropriate Choices the future. Many day-to-day problems come about be- Recent studies of productivity factors re- cause of the selection of equipment by man- sulted in revision of A-76 to emphasize 14 ma- agers who do not understand the mechanics jor categories of services in contracting out. or flow of work in their own offices. The sup- These include ADP, data entry and keypunch, port staff is often not consulted, although they audiovisual, and mail and file services. Agen- could bring to the decisionmaking valuable in- cies are now required to consider three options formation that is otherwise not available. For- —internal performance, use of another gov- mal description of work procedures often bears ernment agency, and outside contractors. They only nominal relationship to the real process of moving a form, a letter, or a report out the “Patrick J. Keogh, Chief of the Economic Analysis Branch door. How smoothly the movement proceeds of GSA, “Deregulation is Challenge to Procurement Officials, ” is affected by a myriad of details from how Government Computer News, November 1984. Ch. 9—The Automation of Federal Government Offices ● 241

are still encouraged to contract out as many professional procedures and the increasingly services as possible, if those services would demanding safeguards and checks imposed by require more than 10 Federal employees.34 Congress to ensure fair competition. OMB recently reported that cost compari- To guard against violations of established sons are now going against privatization in safeguards, the contracts officer tends to in- about half of the activities reviewed, a much sist on elaborate specifications before request- higher percent than in the past. This has been ing bids. As a result, the development of the advanced as an indicator that government is technology may outrun the procurement cy- becoming more efficient in carrying out its cle, and equipment may be behind the state- activities. of-the-art by the time it is installed. Vendors have no opportunity to propose alternative The Dilemma of Procurement Policy specifications that could provide more innovative ways of meeting agency needs. In their own audits and reviews, agencies frequently identify problems such as those Overspecification is particularly likely to oc- GAO listed above. For example, the Inspec- cur with information technologies because con- tor General of a major agency36 in a 1985 tracting officers usually are not experts in the technology and are unable to rely on their own post-installation review of major systems professional judgment about how detailed listed a number of failures: no clarification over who has control over the project, no determi- specifications must be. Contracting officers nation of total-user requirements, poor plan- are themselves at severe risk if there are too ning and design, lack of coordination between many challenges to their actions on grounds two user groups, and acquisitions occurring of inadequate competition and this makes them even more cautious.38 at field level, resulting in incompatibility. Mis- takes of this kind can and should be avoided An additional complication with competi- as better procedures are developed. tiveness in regard to information-technology But at the same time, for larger systems, procurement is the desire for compatibility agency procurement procedures may be too with existing equipment. If the procurement elaborate and too rigid. 37 For advanced Sys- is decided on the grounds of compatibility, it may be faulted for noncompetitiveness; if tems, including the computer networks that greater competition results in procurements are becoming a high priority goal in most agen- that require additional high expenditures to cies, the procurement procedures often result in specifications that are precise, elaborate, compensate for noncompatibility, the decision may also be faulted. and rigid. This creates major problems. The agency contracts officer finds himself caught Overspecification, according to industry ex- in a tension between the agency or program perts, can result in procurement specifications officer’s need to solve old problems or achieve that reflect obsolete approaches to technical new goals with advanced technology on the problems, or specifications that no vendor can one hand, and on the other hand, customary exactly meet, although several vendors may have alternative approaches that would solve “Eric Fredell, “OMB Restricts Contracting Out in A-76 the technical problem, perhaps at less cost than Revision, ” Government Computer News, November 1984. ‘5 Myron Struck, “Workers Break Even in Cost Studies, ” The is entailed in meeting the government speci- Washington Post, Apr. 11, 1985, A19. fications. ‘This was typical of audits and reviews shown to OTA by agencies; there is no intent here to single out a specific agency ‘Federal contracts officers have a warrant, giving them for criticism or otherwise, and the agency is therefore not iden- sign-off authorit~’ on contracts up to a specific dollar limit. If tified. there are serious challenges to their decisions about competi- ‘Based on discussions at workshops for Federal agency of- tive contracts they may not only get a poor performance evalu- fice automation specialists held by OTA in October 1984 and ation, but can lose their warrant, or have their sign-off author- July 1985, and on many other written and spoken communica- ity reduced, which would seriously damage their future career tions from Federal officials. outlook. 242 ● Automation of America’s Offices

In some cases, attempts to make procure- policies that give agency managers wide discre- ments more competitive and to increase action in formulating acquisition policies, has kept countability result in procedures that seriously pace with private sector office automation, and obstruct the accomplishment of agency respon- that the opportunist y for increased productivity sibilities. will not be unduly limited by procurement-related problems. in spite of these problems, OTA concludes that office automation, under Administration

WHAT WILL OFFICE AUTOMATION MEAN FOR FEDERAL OFFICE PRODUCTIVITY?

Nearly all observers agree that Federal of- cent, through the use of office automation.39 fice automation is increasing agency produc- It is not clear how this estimate was calcu- tivity. But because there is no agreement on lated, but the 15 percent estimate recurs fre- the definition of productivity, this benefit is quently in agency projections of increased pro- hard to measure and document. ductivity.

Based on past experience and analogy with The first round of agency reviews of their the private sector, the gain in productivity is information-resources management, as re- probably far below that which is eventually quired by the Paperwork Reduction Act, be- possible. A mixture of old and new technol- gan in 1982. These reviews varied in scope and ogy is rarely completely effective. Workers objective; some were designed to assess sys- using the new technology must cope with ex- tem performance, some evaluated the effec- isting paper-based data, through procedures tiveness of systems in direct support of spe- built up around older work activities, coordi- cific program areas, and some concentrated nating with other offices that have not been on the effects on administrative responsibili- automated, in a bureaucratic structure orga- ties and budgets.40 nized to fit the earlier patterns of workflow The reviews were intended to address progress and task sequencing, and in a workplace envi- in reduction of the paperwork burden, im- ronment that was not planned with the new proved delivery of services, elimination of ac- technology in mind. tivities that duplicate private sector sources, Moreover, the training that is given to work- budget savings, improved productivity, im- ers using the new technology is clearly inade- proved technology, and improved management quate. Most of them are learning on their own, controls. But few cited specific productivity and from each other. This takes time to ac- gains that could be quantified. These status complish, and also cuts into the time that is reports illustrated why it is difficult if not im- spent in direct production of output, both for possible to specify, either in advance or in ret- learners and teachers. Managers, too, are still rospect, the direct productivity y benefits of of- struggling to learn new techniques for man- fice automation. First, information resources aging the automated office. (Federal training management goes beyond office automation is also discussed in chapter 3.) “AS quoted by the U.S. General Services Administration, Of- fice of Information Resources Management, Managing End Evaluations of Productivity User Computing in the Federal Government. ‘“OMB then targeted and monitored 66 of the reviews, be- The General Accounting Office estimated ing conducted by 26 agencies. Executive Office of the Presi- the cost of the government work force as $81 dent, Office of Management and Budget, Improving Govern- ment Information Resources Management: A Status Report, billion in 1980 and on that basis calculated March 1983. Hereafter cited as EOP/OMB 2. See also EOP/OMB a potential savings of $12 billion, or 15 per- 1, cited previously. Ch. 9—The Automation of Federal Government Offices . 243 — . —

and some of the gains come from reorganiza- Productivity could mean more or better work tion or increased management attention. Sec- performed or services delivered; it could mean ondly, in most cases, automation is not a one- doing the same work at less cost. time, self-contained event and comparison of clear-cut before and after measurements are The Merlin Experiment not possible. One example of productivity assessment is Many agencies have provided OTA with sys- an Office of Personnel Management (OPM) tem plans and evaluation reports in which they evaluation of the General Service Administra- made estimates or projections of productivity tion’s Merlin System, installed in GSA’s West- gains from office automation. For example, ern Region in July 1983.44 Merlin is composed a natural resource agency recounts cutting of 84 personal computer workstations linked staff in one field office from 370 to 120 when by a local area network and used by mana- much of the work was automated by a new gerial, technical, and senior clerical employ- computer system. There are also many esti- ees. The OPM study was based on systematic mates of future savings. A science-oriented measurement and evaluation of work before agency estimates that 10 percent of the work and after the installation. In 39 of the 47 cate- hours of administrative personnel and 3 per- gories of tasks studied, output increased “recent of those of its scientists’ will be saved. markably”: OPM rated this ‘‘a strong overall Another agency expects time savings of 10 improvement. The volume of output per em- percent for administrative personnel and 20 ployee hour went up in 14 of 19 categories. percent for professionals, and the elimination Cost per unit of output was reduced in 79 per- of some technical positions. These estimates cent of the categories. In some categories it are persuasive in context, but they use so many was possible to compare the same kinds of out- different ways of estimating or aggregating put with and without use of Merlin, in the same that they cannot be evaluated or compared. time period; 10 of the 17 categories showed improved unit time with Merlin. OPM also Although not called out as a criteria for found a reduction in contract preparation time, evaluation in the status reports, there appear improved time and project management, and to be many cases where information technol- a ‘‘marked reduction’ in time spent in meet- ogy has resulted, or can result, in services to ings, due to the system’s communications ca- the public that would not be possible without pabilities. OPM’s figures appear to indicate it.42But in the interest of reducing the Fed- about a l-percent cost saving for the organiza- eral deficit, there has been more emphasis on tion as a whole (across about 4.4 person years attempts to reduce or constrain the growth spent in all tasks done by the organization) .45 of government services than on expanding No information is given about the cost of Mer- them. lin or its anticipated lifetime. OMB, while specifying productivity as an evaluation criteria, has not defined it nor pro- Incentives vided a metric for it. OMB says only that with the technology “the Federal Government In the private sector, increasing the output should be able to utilize available resources and/or the quality of the product should in- in a more efficient and effective manner. ’43 crease the organization’s market share and ultimately its profits. This incentive does not — - .— “Fifteen percent of the 20 percent of their time that the scientists spend on administrative duties. “U.S. Ge~eral Services Administration, Office of Informa- ‘For example, the automation of the Occupational Safety tion Resources Management, Merlin Impro\’ements, January and Health .Administration technical Data Center allows 1985. 0S11A to respond yearly to several thousand inquiries by go\r- ‘ App. D of the cited report gives “total time and total ernment agencies, workers and their unions, employers, public cost” for sample 1 (preMerlin) as 9,200.6 hours and $132,160,10 interest groups, and the general public. or S 14.36 per hour; for sample 2 (post-Merlin) as 9,763.0 hours ‘lEOP 021111 1, p. 12. and $138,731.30 or $14.21 per hour. 244 ● Automation of America’s Offices

operate in government. On the contrary, a gov- without damaging their ability to get the work ernment organization that performs its work done. at less cost typically finds its budget reduced New York City undertook to automate its for the following year, usually with no reward municipal offices under a strong drive to re- for the managers who achieved the cost reduce costs and increase government reve- duction. Instead, if they have fewer employ- 47 nues, and high level officials say that progress ees they may lose status and find their chances is being made toward these goals. The same of a higher grade level significantly prejudiced .46 pressures are operating within the Federal The always present possibility of across-the- agencies, and there is every reason to antici- board budget cuts encourages Federal execu- pate that the results will be much the same. tives to keep staff levels above the minimum Productivity as measured by output and by that is necessary so that cuts can be absorbed labor costs is likely to increase; whether this “For example, a 1980 U.S. General Accounting Office re- is accompanied by improvement in the qual- port concluded that productivity rates achieved by Federal pay- ity of government services is much more un- ment centers varied by 600 percent, and added that the GAO auditors were told by payment center managers that there were certain. strong disincentives against raising productivity, of the kind described here. GAO, Improving the Productivity of FederaJ Payment Centers Could Save Millions, FGMSD-80-13, Feb. 12, “According to a case study of municipal office automation 1980. done for OTA; see app. B for a summary.

IMPLICATIONS FOR THE FEDERAL WORK FORCE

If office automation does increase produc- These potential changes should be consid- tivity in Federal offices, it could allow Fed- ered in work force projections, in planning, and eral whit~collar employment to be reduced (or in developing policies about personnel recruit- it could allow government services to be ex- ment, rewarding and promoting, retention, and panded without a proportionate increase in em- retirement. There is no indication that OPM, ployment). Automation may also: OMB, or other central agencies of government are studying the implications of such changes. ● change the nature of the work and the skill requirements of some jobs, Since Federal offices have been using com- ● effect the number of people needed in puters for about 20 years and have been rap- some job categories, idly automating over the last 5 to 10 years, ● create new jobs and occupations, and indicators of such change should already be make other jobs obsolete. apparent with careful statistical analysis. This analysis has not been done on a systematic Such effects would change the relative num- basis. However, OTA concludes that there are ber of people needed in the major categories at least some general indicators that such of Federal jobs—professional, administrative, changes are underway. technical, and clerical; and also affect the distribution of people at each grade level and salary level.48 Such changes in the structure of Size of the Work Force the Federal work force, as well as the size of If office automation is affecting Federal em- the work force, will strongly affect total labor ployment levels, then historical growth rates costs and thus the cost of government. should be slowing or reversing. Growth of the ——- .-—. In the Federal civil service, employees hold a grade level Federal work force has in fact slowed, stabi- in one or the other of approximately 100 pay plans used by lized, and then been reversed over the past the executive branch. About two-thirds of them are covered 15 years. It is not necessary to argue that of- by the largest pay plan, the General Schedule (GS). This has grade levels from 1 (the lowest) to 18. The employee’s grade fice automation has been the cause of this de- level determines the range of salaries that he or she can obtain. cline. The volume of government employment Ch, 9—The Automation of Federal Government Offices ● 245

depends strongly on the political philosophy growth in the 1960s was perhaps in part re- of the Administration in power and of Con- lated to the Vietnam War, but it was charac- gress about the scope of Federal Government terized by increases in the number of postal responsibility and the services that govern- workers and the number of general adminis- ment should provide. It is also strongly af- trative, clerical, and office service workers in fected by population growth and economic ex- nondefense agencies.51 Thus, it was probably pansion. However, given apolitical imperative related to the trend toward an information- to reduce the cost of government and hence intensive economy and to political initiatives to shrink Federal employment, it can be ar- such as the War on Poverty. gued that office automation has at least al- But from 1970 to 1980, Federal employment lowed and facilitated a reduction of the work growth slowed; it grew only 2 percent in that force. decade.” During this period the Federal work Federal employment has grown every dec- force was–like the country’s general labor ade of our history except the 1920s. (See fig- force–becoming more thoroughly white-collar. ure 9-1. ) It has not, however, kept pace with The ratio of white-collar to blue-collar Federal growth in population or in the economy.” Fed- workers changed from 2.9: 1 in 1960, to 4:1 in eral employment grew by 73s percent during 1980. Yet at the same time the growth of the the 1930s and the New Deal, 88 percent dur- Federal whit~collar work force has also slowed; ing the 1940s and world war, 23 percent in it grew more than 13 percent from 1960-65 the 1950s, and 24 percent in the 1960s.50 The and again from 1965-70, but only 7 percent —— from 1970-75 and 3 percent from 1975-80. This “’Federal employment has steadily decreased relative to the change was at least coincident with the speed- size of the economy and the national population, from 3.7 percent of U.S. civilian employment in 1960, to 2.9 percent in 1982, ing up of office automation, which began about and from 13.1 (executive branch) Federal workers per 1,000 1974. population in 1960, to 12.2 in 1982. The Federal proportion of total public sector employees has declined from 33 percent Every 2 years from 1960-74, the number of in 1950 to under 18 percent in 1980 (U.S. Department of General Schedule and Merit Pay employees Commerce, Statistical Abstracts) ‘ Historical Statistics of the United (about two-thirds of all Federal white-collar Bureau of the Census, 53 States, Part II, Series 308-317. employ ment) grew about 3 percent; from 1974-84, the average growth rate each 2 years was only 0.3 percent. This may also be an in- Figure 9.1 .—Paid Civilian Employment of the dicator that office automation was having an Federal Government, 1881-1983 effect. Such indicators do not of course establish a cause-and-effect relationship. Nevertheless, the cumulative evidence that automation of white-collar work can at least allow employ- —— -- -- “Department of Defense employment increased 15 percent from 1960-70, but it was 43 percent of total Federal ci~’ilian employment in 1960 and only 41 percent in 1970. (Stat. Abstr. 1984, table 535.) But General Administrative Clerical, and Of- fice Services increased 20 percent and postal workers increased by 26 percent. “Stat. Abstr. 1984, table 535, p. 333. 1881 1891 1901 1910 19201930194019501960 197019801991 “There are over 100 pay codes or schedules for Federal executive branch employees, although some co~’er only a handful Year of workers. A few, such as those used only for Foreign Service SOURCES Data from 1881-1960 based on U S Department of Commerce employees, the Tennessee Valley Authority, or the Veterans Bureau of Census li~s(orical Abstracts of the U S Co/on/a/ T/rnes Administration, co~er thousands of employees. However, the to 7970, fart // Series y 308-317 Washington DC 1975 Data from 1970-1983 based on U S Department of Commerce Bureau of Cen GSGM pay codes cover about 67 percent of all white-collar sus Stat(st/cal A bsfracfs of fhe Um fed States. N 523, Washl n gton workers, and a higher percentage of those who are administra- DC 1985 tive or clerical.

52-641 0 - 85 - 9 246 ● Automation of America’s Offices — ment growth to be constrained or reversed overall increase. Secretaries, who have more while the amount of information-handling in- diverse duties and make higher salaries than creases, is persuasive. clerk-typists, now make up 60 percent of this group of workers, as compared to 44 percent Changes in the Mix of Federal Jobs in 1975.

There are now 8 percent fewer people in the Shifts Among Occupational Categories jobs grouped under “General Administrative, and Grade Levels Clerical, and Office Services” than there were 54 in 1975. A closer examination of this group, These changes in and among job classifica- which contains about one-quarter of all Fed- tions imply that there will also be changes in eral workers, also suggests that office auto- the shape of the Federal work force—the dis- mation is bringing about basic changes in Fed- tribution among major occupational catego- eral office work and in Federal jobs. ries (professional, administrative, technical, For example, four job titles within this and clerical) and across grade levels and sal- grouping have disappeared since 197555—cold- ary levels. Such changes have occurred in the type composing machine operation, dictating last decade, although undoubtedly many forces machine transcription, electric bookkeeping are operating to affect this trend. The distri- machine operation, and calculating machine bution in terms of the major occupational cat- operation. Together they accounted for 8,500 egories is squaring up. The proportion of cler- jobs in 1975, although even then they were ical workers is declining, and the proportions on the way to becoming obsolete jobs. In 1975, of technical, administrative, and professional there were already 42,500 computer operators, workers have been growing (although the share specialists, and aides; that number has grown made up by professionals is now beginning to by 9,000.5 ’ shrink slightly). (See figure 9-2. ) Some job titles have changed as the tech- Clerical Workers nology associated with them changed-for ex- In October 1983, about 25 percent of Gen- ample, card punch operations has become data eral Schedule (GS) employees were clerical transcription. The number of people who pre- workers. In 1975, more than 31 percent were sumably spend much of their time typing (now clerical workers. The figures for both years ex- known as keyboarding) may have grown de- clude postal workers (who were removed from spite the spread of word processing. In 1975, OPM’S occupational survey between 1979 and there were over 7,146 dictating machine tran- 1981); with them included, more than 45 per- scribers (a classification that does not now cent of white-collar employees were in the cler- exist), 72,895 clerk-typists, and 62,373 secre- ical grouping in 1975. Ninety percent of Fed- taries. By 1983, there were 11,780 fewer clerk- eral clerical workers in 1983 were in grade typists but 29,100 more secretaries, a 7-percent levels 3 through 6, with another 3 percent in 57 “’U.S. Office of Personnel Management, Federal Civilian grades 1 and 2. . Work force Statistics: Occupations of Federal White-Collar and —— Blue-Collar Workers, MW 56-18, Oct. 31, 1983, table E, and ‘“As a reference point, there were over 305,000 Federal cler- U.S. Civil Service Commission, Federal Civilian Manpower Sta- ical workers in grades 1-6 in October 1984. At the high end tistics: Occupations of Federal White-collar Workers, SM 56- of the scale are secretaries and claims, payroll, legal, and travel 11, table F-1. Postal workers have been removed from the 1975 clerks and statistical assistants; average grades for these job data to make it comparable to 1983 data. classifications are between 5 and 6 (roughly $16,000 to $17,000 “The only entirely new job title is equal opportunity spe- in 1983) and there are about 110,000 people in such jobs. At cialist, although as noted the title of some job classifications the low end of the clerical scale are messengers, clerk-typists, (as identified by code number) has changed. mail and file clerks, and computer clerks, with average grades “The extent to which people displaced from eliminated jobs of 2-4 ($12,000 to $14,000). The breakdown of workers in each move into newly created jobs cannot be answered from this category by grade level is based on an OMB computer printout data. However, it appears from OPM print-outs that most of as of Mar. 31, 1983, while the total numbers for each category the over 7,000 dictating machine transcribers were women; most are for October 1983. This should not, however, cause any ma- of those in computer specialties are men. jor misstatements. Ch. 9—The Automation of Federal Government Offices ● 247

Figure 9-2. —Changes in the Distribution of Federal Technical Workers Employees by Occupation, 1975 and 1983 About 22 percent of GS employees in 1983 1975 (nearly 332,000) were technical workers or Technical (1 80/0) paraprofessionals with such diverse titles as economics assistant, communications specialist, tax technician, and equal opportunity as- Admlnlstrative sistant—120 titles in all. In 1975, only 18 (24 %) percent” of the Federal workers had techni- Clerlcal (31 0/0) cal ratings. This trend probably reflects the development of an information society in which scientific and technical information is a ma-

professional ( 19°70) ‘ Other (8 O.) jor factor in all economic activity.’” Administrative Workers Another 28 percent of GS workers in 1983 1983 (432,000), were classified as administrative, Technical (22 O/. ) compared to 24 percent in 1975. Nearly 11 percent of all Federal white-collar workers are supervisors; just over 2 percent are called managers, or top-level executives. (The latter are Adminlstratlve Clerical 25%) usually in the professional rather than the (28 O/. ) administrative category.)61 About 90 percent of administrative workers in 1983 were low and middle-level managers in grades 9 through 0/0 ) 15, with nearly another 10 percent just below Professional (22°/0) 62 SOURCES 1975: U S CIVII Service Commlsslon, Federal Ciwlfan Manpower Sfa- in grades 5 through 8. Program managers, f~stfcs Occupat~or?s of Federa/ kVh/te.Co//ar Workers, Oct 31, 1974 health systems administrators, and computer- and 1975, SM 56.11, Washington, DC, 1975, and 1983: U S Off Ice of Personnel Management, Federa/ C/v///an Workforce Stat/sf/cs Oc- systems administrators, for example, have cupations of Federa/ Wh/te-Co//ar and B/ue-Col/ar Workers, Oct 31. 1983, MW 56-18, Washington DC, 1983 average grade levels of 13 or over. Passport and visa examiners and social insurance claims In internal Federal agency documents and examiners are at the lower end of the range in anecdotes told by Federal office automa- and have grade levels under 9. Again, it is the tion managers, it is frequently said that gov- administrative classifications with lowest grade ernment clerical workers, once trained in the levels that appear most likely to be reduced use of office automation, are often hired away in numbers as some of their tasks are auto- by private sector industries that offer higher mated, if the experience of their closest coun- wages. This is alleged to be true especially in terparts in the private sector, insurance raters, field offices in some sections of the country. and underwriters, can be generalized. This disparity is largely at lower salary levels; 34 percent of Federal data processing work- “U.S. Civil Service Commission, Federal Civilian Manpow- ers made under $23,400 in 1983, compared to er Statistics: Occupations of Federal WhiteCollar Workers, Oct. 22 percent of those in the private sector, ac- 31, 1974 and 1975, SM 56-11, pp. viii and x. The 1975 figures have again been revised to exclude postal workers. See table cording to figures derived by the Congressional B of the CSC publication. Budget Office. However, 35 percent of Fed- “The grade levels for technical jobs vary widely (the 90 per- eral data processing specialists earned $35,400 cent range is from GS 4-11) but the a~’erage grade is 7.14 (a\’erage salary $21,000 in 1983]. or more, compared to 33 percent of those in ” ‘ ‘U.S. Office of Personnel Management, Federal Civilian the private sectors Work force Statistics: Occupations of Federal White-Collar and Blue-Collar Workers, Oct. 31, 1983, MW 56-18, p. 8. ‘-U.S. Congressional Budget Office, Reducing Grades of the ( The average grade for administrators is 10.9 (average sal- General Schedule Vt’ork Force, September 1984, p. 43. ary $32,000 in 1983). 248 Automation of America’s Offices

Professionals trated. By 1980, it was 38.6 percent. The per- Just over 22 percent of Federal workers were centage of workers in grades 7 and 8 remained professionals in 1983, as compared to 19 per- much the same (11.4 percent in 1974, 11.5 percent in 1975. Again, this increased proportion cent in 1983). But the proportion in grades is probably related to changes in American 9 through 14, where most of the professionals society and economy as well as to office auto- and supervisory administrative workers are mation. In 1983, 94 percent of professionals concentrated, has grown from 45.1 to 49.4 per- 65 were in grade levels 9-15. Their average grade cent. (Congressional Budget Office (CBO), level was 11.7 with an average salary of taking slightly different parameters, says that the percentage of people in middle-manage- $36,000. (In 1983-84, however, the proportion of professionals in the Federal work force was ment grade levels 9 through 15 has grown from 66 reduced slightly from that in 1980.)63 33 to 37 percent since 1974.) The establishment of the Senior Executive Changes In and Among Grade Levels Service (SES) was intended to increase the These changes have squared up the Federal retention of senior Federal executives by pro- structure, viewed in terms of occupational cat- viding them with the opportunity for higher egories, so that their proportions, which in rewards (bonus pay) in return for some sacri- 1974 ranged from 18 to 31 percent, are now fice in job security. It is generally agreed that more nearly equal, from 22 to 28 percent, with it has not worked well; many SES people be- administrative rather than clerical occupations lieve that they have been made more visible as the largest group. Paralleling these shifts, and therefore the particular target of reduc- the number of workers at each grade level has tions in force (RIFs) and salary caps or freezes, also changed. (See figure 9-3.) In 1974, 41.9 and most of the few bonuses have gone to a 67 percent64 of Federal workers were in the lower relative few of the highest ranking people. grades 1-6, where clerical workers are concen- People tend to think of bureaucracies as -— ..-. shaped like a pyramid. The Federal work force “About 3 percent of Federal workers are usually classified is shaped more like a very flattened figure 8 as “other or unspecified, ” usually because their jobs are being reclassified during the counting period. or hour-glass. There are relatively few people “The figure for both years excludes postal workers; if they in the lowest grades, a large bulge at grades are included for 1974, the percentage becomes 41.6 percent. 5 and 6, a narrow waist representing grades 7 through 10, another large bulge at grades Figure 9-3.—Change in Distribution of Federal 11 and 12, and a rapid drop-off in numbers in Employees by Grade Levels, 1974-80 grades 13 through 15. The number of positions 5 1 at grades 16 through 18 and in the Senior 4 — Executive Service (equivalent to grades 16 3 — through 18) is limited by law and is less than 2 - 0.5 percent of all Federal jobs. (See figure 9- 1 — o 4.) The figure eight is getting squashed down, –1 — the bulges growing wider, and the top and bot- -2 — tom flattened. –3 —

:;~ — . — — . -——. GS 1-6 GS 7-8 GS 9-14 GS 15+ 65Figures supplied by OPM in advance of the 1984 analysis of Federal civilian work force statistics now in progress, and Grade level compared to OPM occupational statistics for 1974 and 1980, SOURCES: u.: +wil Service Commission, federal Civl/ian Manpower Stafh3tics: see previous cites. Occupations of Federal White-Co//ar Workers, Oct. 31, 1974 and 1975, ‘U.S. Congressional Budget Office, op. cit., p. x. SM 56-11, Washln@on, DC, 1975; and U.S. Office of Personnel Man- agement, Federa/ Civi/ian Workforce Statistics” Occupations of Fed- “’Sar Levitan and Alexandra B. Noden, Working for the eral White-Co//ar and B/ue-Co//ar Workers, Oct 31, 1983, MW 56-18, Sovereign: Employee Rdationsin the Federal Government (Bal- Washington, DC, 1983 timore: The Johns Hopkins University Press, 1983), pp. 94ff. .- —

Ch. 9—The Automation of Federa/ Government Offices ● 249

Figure 9-4.— Distribution of Federal Employment by Grade Level, 1975 and 1983

1975 Grade level

GS 15+ 36,902

GS 13-14 165,930

GS 11-12 296,800

I GS 9-10 178,712 I GS 7-8 165,538 I GS 5-6 273,454

GS 3-4 282,406

GS 1-2 28,745 I II * I II 300 2!0 2!0 150 100 5’0 o 50 1 JO 150 200 2!0 3!0

1983

GS 15+ a 39,883

GS 13-14 181,163 I GS 11-12 361,904

1 GS 9-10 189,316 I GS 7-8 170,512 I GS 5-6 289,732

1 GS 3-4 188,666

GS 1-2 12,425 I 1111111 1111111 I 400 350 300 250 200 150 100 50 0 50 100 150 200 250 300 350 400 Employees (in thousands) ‘The ~r~d~~ 16.1s excluded senior executive service empkwees

SOURCES” 1975: U S Civil Service Commission, Federal Civilian Manpower Sfati5tlcS. Occupations of Federal Whlfe-Col/ar Workers, Oct 31, 1974 and 1975, SM 56-11, Washington, DC, 1975, p 34 1983: U S. Office of Personnel Management, Federal civilian Workforce Statistics Occupations of Federal White. Co//ar and Et/ue-Co//ar Workers, Oct 31, 1983, MW 56-18, Washington, DC, 1983 250 ● Automation of America’s Offices

Unanswered Questions nor did it point out that the Federal work force is far more thoroughly white collar than the The Question of “Overgrading” private sector work force. CBO also pointed The average grade level for the civilian work out that while the government has more mid- force, not surprisingly in view of changes de- dle- and top-ranked workers than the private scribed above, increased from 8.03 to 8.51 be- sector, it also pays them much less; “Federal tween 1974 and 1983. As a result, salaries in- and private sector salary distributions were creased 4 percent (in equal dollars) and about almost identical” in proportion going to peo- 1.3 billion was added to payroll costs.68 The ple at those levels. President’s Private Sector Survey on Cost Con- CBO noted that only 43 percent of Federal trol, and others, have charged that the Civil jobs were, at that time, below grade 11 com- Service is “overgraded, meaning that grades pared with 61 percent in equivalent levels in are too high in comparison with earlier levels the private sector. Again, it did not specifi- 69 and with the private sector. cally note the greater proportion of white-collar The Congressional Budget Office (CBO) con- work in the public sector. cluded that the growth in the proportion of Neither CBO, nor OPM in its own analysis, nonclerical jobs accounted for about two-thirds have given attention to the implications of of- of the half-grade increase. They attributed fice automation for future work force size, most of the additional increase to promotions grade distribution, and payroll costs. Neither granted by some managers to compensate for has systematically analyzed the forces behind repeated caps. 70 An earlier OPM analysis (1980) the changing character of governmental work, said that 60 percent of the half-grade rise was nor acknowledged that these forces are likely due to “changes in the occupational mix of to grow stronger in the future. There appears, the workforce, citing the disproportional de- in fact, to have been no major executive branch 71 crease in the clerical work force. study of the possible effects of office automa- Neither the Private Sector Survey report, tion on the Federal work force or labor costs. OPM, nor the Congressional Budget Office ex- Considering the current emphasis on cutting plicitly addressed the effect of the increasing the costs of government, the high priority professionalization of government work nor given to increased productivity, and the strong of the penetration of information technologies trend toward procuring information technology in the office. CBO did acknowledge “the chang- to accomplish these goals, this is surprising. ing character of governmental work’ in iden- Whether the potential increase in productivity tifying the factor of growth in nonclerical 72 because of office automation, and the consequen- jobs, but did not explicitly raise the ques- tial possibility of shrinking the size of the work tion of how the declining proportion of cleri- force, will more than compensate for the need cal jobs might be related to office automation, for more highly paid technical and professional —— workers is a question that should be studied ‘“U.S. Congressional Budget Office, op. cit. thoroughly. To both reduce the clerical work “’The Administration has proposed reducing the number of force and artificially hold down average grade positions graded GS 11-15 by shifting 8 percent (about 40,000 jobs) to lower grades; this would be done over a period of 4 level and salary could mean that the government years, as vacancies occur. This would save $3.9 billion over cannot attract and hold the people it needs for a 5-year period. See U.S. Congressional Budget Office, op. cit., excellence. p. xi. ‘[’R. Mark Musell, “Reducing Grades of the General Sched- The lack of systematic analysis and plan- ule Work Force, ” LRS84-12344 (Washington, DC: U.S. Con- gressional Budget Office, 1984). ning for changing work force needs makes “’’Average Grade Trend 1974 -1980,” prepared by James some Federal workers anxious about their jobs. Hall, Program Management Information Section, Work Force In discussions and workshops with Federal Information Division, U.S. Office of Personnel Management (manuscript, unpublished). clerical employees concern is often expressed “’Ibid, p. x. about what it may mean for job security and Ch. 9—The Automation of Federal Government Offices 251 the opportunity for promotion. Some of this Unless this is explicitly recognized, however, concern may be unrealistic and exaggerated; it is likely that there will be challenges to the it could be alleviated if officials could talk with factor evaluation system, especially if work- their workers about current effects and the ers believe that they are mastering new skills implications for the future. They cannot hon- not recognized and explicitly valued in their estly do that at present because little or no old job descriptions. Catherine Waelder, Gen- information is available about the effect that eral Counsel of the National Federation of Fed- office automation is now having on Federal eral Employees, has already said that “the fac- employment. tor system is new but its standards and values are old. ” She points out that if not continu- How Jobs Are Classified ously revised, the system will “fail to account As discussed in chapter 4, office automa- for the ability needed to use developing technological resources essential in many profes- tion changes the nature of work and the skills 74 requirements for many jobs. In both the pri- sions. . . .“ vate sector and the public sector, this leads to an expectation that job descriptions and Part-Time and Temporary Workers personnel classification schemes will be revised. Government use of part-time and temporary OPM uses a point/factor rating system in workers is determined by many factors; it may assigning grade levels.73 Brief definitions of or may not increase because of office automa- the factors do not mention any consideration tion. The Federal Employees Part-Time Ca- of equipment that is used in the work. The reer Act of 1978 was passed after several years first and most heavily weighted factor is of effort by members of the Senate and House “knowledge required, ” defined as “the nature of Representatives who were responding to and extent of the information or facts that the urging of female constituents wanting to pro- worker must understand to do acceptable tect career opportunities in government while work. ” It is not clear whether more knowledge reserving time for at-home child care. Unions is required to operate a word processor than objected on the grounds that it would take to operate a typewriter, or whether using a jobs needed by over three million women ac- spread-sheet program takes more or less spe- tively seeking full-time employment who could cial knowledge than using a bookkeeping ledg- not afford to support their families on part- er. In some cases automation requires less time employ ment.75 knowledge about the process being carried out, The act required agencies to do feasibility in other cases it requires additional abstract studies, establish annual goals and timetables, thinking or ability at problem solving. It ap- and review and monitor part-time work oppor- pears that Factor No. 1 could be interpreted tunities. Part-time Federal employment did in- so as to accommodate necessary technologi- crease by almost 14,000 from 1979 to 1981, cal skills, and thus jobs could be reevaluated to a high of 57,184; but in 1981 in the strong and their grade level moved up or down, if their effort to reduce Federal employment, part-time nature changes because of automation. workers were laid off at a higher rate than full- . . ..— time employees, and by 1984, the number of The factors are: 1. knowledge required hy position { 1,850 points, 41 percent part-time workers had declined by roughly of maximum total), 2,000. In a 1982 review of the Part-Time Ca- 2. supervisory control (650 points), reer Act, GAO found that most agencies were 3. guidelines (and judgment needed to apply them) (650 76 points), not conforming to its requirements. 4. complexity’ of work (450 points), “Statement in IIearing on 11. R. 4,599, Federal l]a~’ I;quit.} 5. scope and effect of work product (450 points), Act of 1984, op. cit., p. 248. 6. personal contacts with nonsupervisors (220 points), “’William G. J4’hittaker, Federal Legislatitre Interest in 7. physical demands (50 points), and Alternative Patterns of It’ork: An O\er~’iewr, U.S. Congress, 8. work en~ironment (.50 points). I.ihrary of Congress, Congressional Research Service, Mar. 31, The point range for grades 1-6 is 190 to 1,350 points; for grade 1980. 9— 1,855-2, 100; for grade 15—4,055 and up. The maximum to- ‘ U.S. General Accounting Office, Part-Tinle ll~mp)o.~rn]ent tal is 4,480 points. in the Federal Gox-ernment, Jul~T 1 !2, 1982. 252 ● Automation of America’s Offices —

OPM is now again encouraging part-time workers are in grades 14 and 15. As a result and temporary employment on the grounds of their concentration in lower level jobs, that it is cost-effective.77 If office automation women (who hold 46 percent of Federal Gen- allows the work force to be reduced and kept eral Schedule jobs) have an average salary that lean, part-time and temporary workers are is 62 percent of men’s average.80 likely to be used to augment permanent staff It is estimated that three-quarters of the when there is a short-term increase in the workload; thus temporary and part-time Federal lowest ranking Federal jobs (by grade level) are predominantly women’s jobs.81 Since of- employment is likely to increase as along-term fice automation is most likely to bring about trend. Since the objective of part-time work reductions in lower level Federal jobs, women is from an employer’s perspective to allow workers are those most likely to be made rapid, flexible adaptation to changes in work- redundant. This could lead to a statistical im- load, the number of part-time workers will fluc- provement in the position of women in the Fed- tuate widely .78 eral work force, as a group, since their average grade level should rise as a result. This Women in the Federal Work Force statistical “improvement should not obscure Several bills now before Congress deal with the fact that the job losses will be dispropor- questions of pay equity and comparable worth tionately suffered by women. in the Federal civil service. Comparisons of job content and skill requirements will be made Quality of Worklife more complex as office automation changes Again, the case study of office automation the nature of the work. While many clerical 82 in New York City offers some possible indi- jobs have traditionally been considered wom- cators of present and future effects on a civil en’s work, ” the degree of gender dominance service work force. In automated municipal differs significantly by grade level. (See fig- departments, new tasks were learned that cut ure 9-5. ) In the occupational category of Gen- across traditional occupational definitions, but eral Administrative, Clerical, and Office Serv- there was little or no evidence of job upgrad- ices, women predominate at grade levels 1 ing in clerical and technical (paraprofessional) through 9, and men at grade levels 10 through positions. Neither old or new job ladders pro- 15. In grades 2 through 6 the percentage of vide a ready path for these workers to move workers who are female varies from 78 to 90 79 up in the hierarchy of jobs, and some rungs percent. In grades 7 through 9, the propor- of the job ladder have been removed by auto- tion of women ranges from 71 down to 61 per- mation of intermediate tasks and responsibil- cent, and at levels 10 through 15 the propor- ities. In some jobs, abstract and conceptual tion decreases with each level, from 41 to 10.3 knowledge is becoming more important than percent. Thus, while office services jobs are traditional skills, but this change has not been thought of as a group as “women’s jobs, ” their accompanied by an increase in pay scales. This grade level distribution is not much different from their distribution in the Federal work .—— ““In the ‘Federal Wages Schedule (blue-collar workers) force as a whole for women. About 62 percent women are only 9 percent of the total, and their average wages of female Federal employees are in grades 1 are 79 percent of men’s average. Among all FWS and GS work- through 6, as compared to 20 percent of male ers (83 percent of all Federal workers) women are 38 percent of all employees and their average salary/wages are 68 percent employees. Only 10 percent of female Federal of men’s average. U.S. General Accounting Office, Options for -— —-. —— —----- Conducting a Pay Equity Study of Federal Pay and Classifica- “’Since January 1985 agencies have been allowed to keep tion Systems, GAO/GGD-85-37, Mar. 1, 1985. temporary workers for up to 4 years; the previous limitation “]Statement of the Honorable Michael I). Barnes of Mary- was 1 year. land, Hearings on H.R. 4599, Federal Pay Equity Act of 1984, Wee ch. 2 for a general discussion of part-time and tem- before the Subcommittee on Compensation and Employee Ben- porary work as related to office automation. efits of the House Committee on the Post Office and Civil Serv- “Grade 1, which is held by fewer than 150 workers (many ice, 98th Cong., 2d sess., pt. I, Apr. 3-4, 1984. of them messengers) is only 66 percent female. “Greenbaum, Pullman, and Syzmanski, op. cit., ch. 1, Ch. 9—The Automation of Federal Government Offices c 253

Figure 9-5.—Full-Time White-Collar Employment in the Federal Work Force by Grade Level and Sex, 1974-75 and 1983

I 1974-1975 GS 1-3 —

—

. . I I I I I 1 I I I I I I I I I I ) 350 300 250 200 150 100 50 0 50 100 150 200 250 300 350 4 o Work force (in thousands)

1983

— I I I 1 I I I I I I I I I I I ] 350 300 250 200 150 100 50 0 50 100 150 200 250 300 350 4[ 10 Work force (in thousands)

SOURCES 1974-75: U S CIVII Service Commlsslon, Federal C/v///an Manpower SfaI/sfics Occupat/or7s of Federal kVh/te-Co//ar Workers, Oct 31, 1974 and 1975, SM 56-11, Washington, DC, 1975 1983: U S Office of Personnel Management, Federal C/v/l/an Work force Staf/sf/cs Occupations of Federal Whife.Co//ar and B/ue-Co//ar Workers, Oct 31, 1983, MW 56-18, Washington, DC, 1983 254 Automation of America’s Offices — is becoming a union issue and apolitical issue Labor Management Relations and in the city. Federal Unions The observations made on quality of work- In the civil service, managers have less con- life and the automated office environment in trol over subordinates than in the private sec- chapter 5 generally apply to the Federal of- tor, because of civil service rules and protec- fice as well as to the private sector. Physical tion. Managers themselves are subject to man)- conditions are probably not as good in public of the same rules, regulations, and restrictions sector offices as in many private sector offices. on wages and on bargaining as are their subor- Turnover of facilities and office furniture is dinates. Many Federal managers and profes- probably slower so that new technology is even sionals belong to professional associations that more likely to be inserted into old settings. serve much the same functions as unions;85 for Furniture, lighting, and space layout is often Federal employees, this means lobbying Con- inappropriate for microelectronic equipment gress rather than bargaining for pay and ben- now in use. efits, since these are set by legislative action.8G One issue likely to be controversial is the Federal unions will not be able to mount ef- use of computer monitoring and pacing of 83 fective resistance to reductions in employment work. Federal labor law holds that applying as these become possible, but they may be ex- work measurements and using these to evalu- pected to monitor changes in job content, job ate employees are management prerogatives classifications, and compensation as a result and need not be negotiated with unions repre- 84 of office automation. The position that the senting Federal employees. However, agency largest unions have taken and will take on such management can if they so choose bring the issues as stress, risks to health from CRT use,87 unions into discussion of work standards and measurement. Unions have attempted to raise These include the Federal Management Association, the the monitoring issue at some agencies but Professional Management Association, and the Senior Execu- tive Association (the latter open only to those in grades 16-18 these attempts have been rebuffed as “non- and the Senior Executive Service). negotiable’ under the management rights Until 1961, membership in unions by Federal workers was clause. Arbitration rulings have upheld agency not recognized officially, and there was no provision for collective bargaining. However, about 13 percent of nonpostal work- management when work monitoring was chal- ers and a much higher percent of postal and blue-collar workers lenged, for example, in the Social Security Ad- had already joined. Between 1963 and 1969 the membership ministration. more than quadrupled, from 180,000 to 843,000. President Kennedy affirmed the right to join unions and a very limited right to collective bargaining in 1962 in Executive Order 10988, and the area for collective bargaining was slightly enlarged by the Civil Service Reform Act of 1978. But Federal unions are still generally precluded from bargaining about wages and fringe benefits, hiring, firing, work assignment, disciplinary ——— .— actions, and contracting out. Levitan and Noden, op. cit.

‘See ch. 5, for a general discussion of computer monitoring Federal employees do not have a right to strike, and may of work. be dismissed and subjected to felony charges if they do strike. “Civil Service Reform Act of 1978, Code of Federal Regu- The Supreme Court has upheld this ruling, saying that the em- lations, title V, sec. 7106 (a) (A) and (a) (B), “Management ployees’ rights under the First Amendment and other Constitu- Rights. ” tional provisions must be balanced against the right of govern- The discussion in this section on work monitoring, where not ment to regulate the behavior and speech of its employees, The otherwise cited, is drawn from an OTA contractor report, pre- dismissal of the air controllers when they struck illegally is pared by the Educational Fund for Individual Rights, Alan likely to discourage other strikes for some time. William B. Westin, principal investigator, February 1985. The report is Gould, A Primer on American Labor Law (Cambridge: MIT based on site visits and interviews in seven Federal agencies Press, 1982), p. 171. between 1982 and 1984, supplemented by a letter of inquiry Thirty-nine States have some form of legislation protecting to 78 Federal agencies, bureaus, and departments in Septem- the right of public employees to organize and bargain collec- ber 1984 to which 44 agencies responded with letters and actively. See William B. Gould, op. cit. companying documentation. Follow-up telephone interviews “Federal employees are not covered by the Occupational were held with 12 agencies that reported significant activity Safety and Health Act but agency heads are responsible for related to work monitoring. maintaining standards consistent with the act (Executive Or- Ch. 9—The Automation of Federal Government Offices ● 255 — or access to training, will be important. Fed- The I LO notes that this will have its most seri- eral unions have already adopted guidelines ous effects “on the prospects of women seek- or model contract provisions on VDTs, which ing to return to the work force and on school they distribute to bargaining committees for leavers. ” use in agency negotiations. Their activism may Nearly all governments are trying to im- increase in the future. prove efficiency and hold down costs, the I LO Federal white-collar workers are more likely notes, citing evidence that many advanced to be represented by a union than are those countries have made cuts in their public work in the private sector. About 54 percent of GS force as a result of information technologies. workers are covered, although only about one- For example, Canada had a net reduction of third of those are dues-paying members.” In 12 percent in employment in government sec- the national labor force, only 8.5 million white- retarial positions from 1975-80. Within that collar workers, about 17 percent of the total, general category, the number of typists de- are members of unions. 89 clined by 35 percent and the number of stenographers by 68 percent, while secretaries Those covered by Federal unions are pre- increased by 17 percent and operators of of- dominantly women and predominantly in cler- fice-composing equipment increased by 97 per- ical categories. Although figures are not avail- 91 cent . able, it is likely that Federal unions have had a net loss of members in the last several years. Evidence of employment effects in centrally planned developed nations are, according to International Comparisons ILO, unreported or ambiguous. In developing countries, wherever statistics are available, The International Labour Organization (ILO) they often show a shortage of qualified com- says that in developed and developing coun- puter personnel.92 tries’ public sector employment: A technology forecast done for the Federal In respect of information processing, it is Republic of Germany by a consulting firm sug- most likely that the over-all impact of com- gested that if the government adopted a strat- puterization lies not so much in the threat egy of maximum use of information technol- of redundancies, but in future limits on growth ogy, 75 percent of all public sector office jobs in clerical and related employ ment.gO —.— could be standardized, and 38 percent auto- der 12196, Feb. 26, 1980); and Federal emplo?ees ha~e the right mated.” The ILO recognizes, however, that to compensation for disability, death, or in]uries sustained in “owing to cost, lack of planning, a desire to performance of their work (Federal Employees Compensation maintain existing work arrangements, or sim- Act, 5 USC sec. 8101 et seq.). “About 61 percent of the Federal work force is represented ply bureaucratic inertia such comprehensive by unions, but this includes 86 percent of Federal blue-collar plans will materialize only slowly, ” and a more workers. Dues paying membership is harder to determine; unlikely scenario for most countries is the grad- ions are not required to make these figures public, See Sar A. I.evitan and Alexandra B. Koden, ii’orking for the So~rereign: ual introduction of components and systems Ernp]ovee Relations in the Fecferaf Go}’ernment (Baltimore: The that can later be linked, as the need arises.94 Johns Hopkins University Press, 1983), pp. 15-20. Federal white- collar workers are chiefly represented by the American Federa- Rapid development of telecommunications tion of Government Employees (34 percent of those who are technology has affected postal workers in co~.ered by union bargaining), the National Association of Go\ F- ernment Employees (4 percent), the National Federation of Fed- many countries, although employment levels eral Employees (7 percentl, and the National Treasury Employ- have not fallen dramatically. Rather, they have ees Union (5 percent). The first two of these are part of the shown slower growth rates in recent years, and AFL-CIO; the other two are independent. ‘Iienry Le\’in, “Jobs: A Changing Workforce, ” Chance, —. .-— — I’ol. 16, October 1984, pp. 32-37. “Ibid. “’International Labour Organization, The Effects of Struc- ‘-11.0, op. cit., p. 28. tural Changes and Technological Progress on Employment in “’J. Sleigh, et al., The Manpower Implications of Microelec- the Public Service, Report I II, Joint Committee on the Public tronic Technolo~’ (London: Her Majesty’s Stationery Office, Service, 3d sess. (Geneva: International Labour Organization, 1979), pp. 77-79, cited in 11.0, op. cit. 1983), p. 30. “11.(), op. cit., p. 17. 256 Automation of America’s Offices — in some countries staff reductions or hiring most countries are all public service jobs) and freezes occurred despite increases in the vol- some do not.95 ume of mail traffic. As to the future, some governments expect reductions in postal, telegraph, and telephone occupations (which in “ILO, op. cit., p. 42.

EFFECTS OF OFFICE AUTOMATION ON PUBLIC SERVICES Productivity increases do not necessarily bases to be collected, manipulated, analyzed, lead to a reduction in labor force numbers or modeled, and systematically applied to pol- costs. Complementary or alternative objec- icy formulation and decisionmaking. This im- tives may be to increase the volume of prod- provement is more difficult to document and ucts or services delivered, or to improve their measure than other forms of increased produc- quality. Or, increased productivity may merely tivity. mean coping with, instead of being overwhelmed It is also possible, however, that office auto- by, an increasing workload. mation may lead to a change in the nature of Because our economy increasingly depends some government services and even to their on information as a resource and a driver of deterioration. For example, services could be- growth, the office workload is inexorably income overly depersonalized and standardized, creasing. The primary objective in office auto- inflexible, and unresponsive to changing needs, mation is sometimes merely to accommodate if the technology itself is allowed to drive the this increased workload.96 One final meaning design of the service or delivery mechanisms. of increased productivity is the creation of entirely new information-related services for cus- A Case Study of Expanding tomers, clients, or constituents. Responsibilities There has been rapid change in the global The history of office automation in the Of- economy, and America’s role in that economy, fice of the U.S. Trade Representative is one since the 1960s. There have also been signifi- illustration of office automation providing the cant changes-particularly during the 1970s— means of meeting new challenges and avoid- in the expectations that our citizens have about ing disruptive overload in carrying out new involvement in Federal decisionmaking, and 97 government responsibilities. the demands that they make on government agencies related to information about public The Trade Act of 1974, authorizing U.S. par- resources and public expenditures. In allow- ticipation in a new round of multilateral trade ing Federal agencies to meet these demands negotiations, elevated to cabinet status the and to accommodate the increased workload, position of Special Trade Representative and office automation quite possibly helped to assigned that officer responsibility for repre- avoid serious problems and disruptions that senting the United States in the negotiations, could have weakened the U.S. position of world and administration of the Trade Agreements leadership. Program under that and other existing acts. Many managers and professionals report that the quality of analysis, reports, and other --- forms of decision-related services is improved “This section is drawn from an OTA contractor report, Wil- by office automation, which allows large data- liam Neufeld, Office Automation in the Office of the U.S. Trade Representative, February 1985. OTA is indebted to the Office of the U.S. Trade Representative for cooperation in allowing ‘Alan Porter, David Roessner, et al., Office Automation this study to be made and in facilitating the research by the Outlook, 1985-2000, contractor report for OTA, February 1985. contractor. The case study is also summarized in app. B. Ch. 9—The Automation of Federal Government Offices . 257

The Office of the Special Trade Representa- Through a combination of central computer tive, which until 1972 had only about 30 em- operations, personal computers, and stand- ployees, had grown to about 126 employees alone and shared-logic terminals the USTR by 1980, when it became the Office of the U.S. staff now has the capabilities of word proc- Trade Representative. In 1980 it was assigned essing, spreadsheet analysis, on-line data man- overall responsibility for formulating and co- agement, graphics, correspondence control, in- ordinating foreign trade policy among all gov- ternal electronic mail, telemail, facsimile, and ernment agencies, representing the United telex. Users can access the general database, States in all trade negotiations regarding the and also a ‘‘magazine’ containing USTR General Agreement on Tariffs and Trade schedules, recent trade and labor summaries, (GA’IT), East-West trade, international invest- and economic news. They can call up trade data ment, commodity agreements, the Organiza- on bilateral trade balances, imports and ex- tion for Economic Cooperation and Develop- ports, domestic and foreign trade actions, and ment, and the UN Conference on Trade and GATT documents. They can communicate Development. 98 These developments reflected through their terminals with the members and the growing importance of world trade in the staff of the Trade Policy Staff Committee (the U.S. economy. nine agency committee that provides analyses and recommendations to the senior level During the 1960s, the small agency had Trade Policy Committee) and of its subcom- needed more and more data to use in develop- mittees, and can electronically transmit doc- ing positions for multinational negotiations. uments to them. They can communicate by There was no central database on trade vol- telemail with the Geneva office, USTR ambas- umes, tariff rates, exports and imports, etc. sadors, and staff members on travel, and can Data was kept or reported by many different use this method of transferring documents be- agencies, in different forms, and categories. tween Geneva and Washington. Hard copy The Washington headquarters and the Geneva original documents can also be facsimile. negotiating office relied on different sets of data collected from different sources, which In interviews, nearly all professionals on the made policy coordination difficult. USTR staff and half of senior managers said that they use terminals extensively, for up to Planning to build a computerized trade data- 75 percent of their working hours. Profes- base began in the late 1960s, but not until 1977 sionals who were interviewed say that they did an integrated database begin to function, can complete a project in half the time it would serving many agencies and lodged for admin- take without their computers. They also re- istrative purposes in a large computer system 99 ported that the increased productivity had al- at the National Institutes of Health. The de- lowed them to clear a backlog of work that velopment of the interagency trade database always built up in the past. Senior staff re- helped pave the way for office automation ported that they could ask for work on shorter within USTR. It did not come about piecemeal deadlines. Some members of the professional but was systematically planned and imple- staff reported that because of electronic commented over a 5- or 6-year period, to mesh with munication and transmission of documents, the large computer system. It has so far cost the time required for review and clearance of only about $2 million (including about $1 mil- trade-policy positions has in many cases been lion investment in hardware). cut in half. . -- At least in the perception of many profes- ‘“The P~es[dent in 1984 proposed to Congress the creation of a Department of International Trade and Industry, with sional staff members, the USTR has been able USTR under the direct control of the Secretary of that De- to take on a continually expanding workload, partment. q and maintain or improve the quality and pace ‘ Renamed the Trade Policy Staff Committee Trade Net in 1984, the system provides a number of member agencies with of performance at the same time, because of data directly available through dial-out computer terminals. information and communication technologies. 258 Automation ot America’s Offices

The staff has grown little if any during the as to use standardized coded forms. When in- 5 years in which office automation was imple- accurate or incomplete information is fed into mented. 1°0 the computers it cannot be detected until late stages of the process, at which time the case Changes in the Nature of has to be put on hold. Case workers say that Delivered Services some clients do not understand computerized forms and throw them away; others are intimi- Standardization and depersonalization of dated by them and throw them away. Many government services is a possible outcome of of the municipal employees say that the qual- office automation. In the OTA case study of ity of the services they deliver has been de- municipal agencies in New York City,101 re- graded. ferred to earlier, an agency providing social The Federal Government also delivers some services to disadvantaged clients reorganized services directly to individuals and households; the application and recordkeeping process so for example, social security checks. With of- —.—. — fice automation some element of personal ““In 1980 after reorganization and expansion of responsibil- attention to the difficulties or foibles of recip- ities, the Office had 116 permanent full-time staff plus 10 As- ients may be lost. The less educated or sophis- sistant U.S. Trade Representatives, or approximately 126 people. In 1984, it has 122 permanent staff members. But USTR ticated, and those with language limitations, has always used detailees from other agencies, and some con- are more likely to be unable to cope with for- sultants and part-time people. When this case study was done mal, unfamiliar processes. Thus, as the deliv- in 1984, the inclusion of such people brought the number of people working at USTR to 183; the number of such people ery of government services is automated, spe- on hand in 1980 could not be determined. cial procedures may be needed to assure that “’’This material is drawn from an OTA contractor report, the access that some people have to services, The Effects of Offi”ce Automation on the Public Sector Work- force–A Case Study, prepared by the Labor Institute (Profes- or the attention paid to their needs, is not in- sor Joan Greenbaum, principal investigator), February 1985. advertently degraded.

EFFECTS ON GOVERNANCE Bureaucracy–a hierarchy of authority, spe- zation’ of tasks makes the work routine, mo- cialization of functions, and formal channels notonous, and finally mindless. The managers of communication and command-is the basic may spend increasing amounts of time cor- structure of government as it is of all complex recting and coordinating, and little time do- formal organizations. Bureaucracy is a valu- ing anything productive. Some political the- able form of organization because it allows ex- orists argue that in the electronic era, elaborate pertise to be harnessed, focused, and directed bureaucracies may be unnecessary. Informa- toward collective ends. tion and communication technologies may offer a way to replace overly large and complex Bureaucracies serve both despotic and demo- bureaucratic structures with more autonomous cratic societies. In a highly technologized so- units assuming responsibility for an entire job. ciety, it can be argued that democracy can exist only because bureaucracy provides a way This prescription would be hard to imple- of using experts without being ruled by ex- ment in government without some sacrifice perts. Policy can be made by political repre- of accountability. Those who want to trans- sentatives, and implemented by the hierarchy form bureaucracies into “democratic work of specialists under their control and oversight. groups” tend to see formal channels of communication and control as a byproduct of But as bureaucracy becomes larger and more specialization of functions, or to imply that complex, the specialization of functions at the they are antithetical to participatory democ- lower ranks can become extreme—’’rationali- racy. But formal communication channels are Ch. 9-The Automation of Federal Government Offices . 259 — also a mechanism for achieving accountabil- within agreed on boundaries. Some political ity, including accountability of bureaucrats to scientists fear that reliance on telecommuni- politically responsible policy makers. Within cations both within and between organizations government, for example, communication typi- (e.g., electronic mail) makes it difficult to con- cally moves through a series of nodes of au- trol or to monitor the flow of information and thority.102 The flow of information also involves blurs the location of both authority and respon- in many cases a flow of authority. The pres- sibility. For example, changes in a database ence of an authorizing signature on or with may be made without an authorizing signa- the information may give it force—that is, ture, or instructions may be transmitted to cause something to happen. It may create or contractors by persons without adequate au- make binding the acknowledgment of an obli- thority for fiscal commitments. gation. At least it acknowledges the receipt Thus, bureaucratic procedures, including for- of the information. The signature, in other mal channels of communication, are integral words, expresses a personal responsibility or parts of the concepts of due process and ac- validation of the information or some action countability. But to the extent that informa- associated with or flowing from it. Finding a tion and communication technologies offer new fully adequate electronic substitute for the opportunities— and perhaps new temptations handwritten signature, as an easily recogniza- –to ignore, evade, and erode those established ble and widely accepted validation for the ori- channels, care must be taken that they do not gin and receipt of messages, is only one aspect 103 diminish the accountability of government offi- of the problem and probably a minor one. Electronic sign off may merely replace the cials. The rules and established channels could persist, ossify, but be ignored. buckslip and the paper-based signature of authority and accountability. The principle of accountability, carried to But a signature is only one example of the extremes, leads to inscribed, detailed, and inflexible rules for every process and procedure. set of procedures that in a government bu- Information technology may provide a healthy reaucracy are designed to control and standardize behavior. The procedures usually in- corrective, making information so generally available that bureaucratic authority is conclude the designation of particular, formal channels of communication through which instantly challenged in a productive, rather than formation (and authority) must flow. The flow a disruptive, way. But when information is is limited to these designated channels not only electronic rather than paper-based, it prop- for the sake of efficiency and control, but to agates more rapidly, is less closely identified with its source, is both more accessible and make it auditable in the future. These proce- at the same time more opaque to the casual dures not only guarantee control, for those at seeker. It may tend to be used less responsi- the top of the bureaucracy, but they also pro- bly. The public could find itself less able than tect the general public; they are the means of before to identify and hold responsible the making power lawful, of limiting its exercise propagator, or the user, of information. ‘ ‘-The di&ssion here draws heavily on Ronald M. I.ee. “.Automating Red Tape: The Performative vs. Informative Roles On the other hand, as information becomes of Bureaucratic Documents, ” Office: Technolog~ and People, the subject of formal resources management, vol. 2 (The .Netherlands: Elsevier Science Publishers B. V., 1984). pp. 187-204. it is also possible for its use to become so en- “ Many organizations rely on the use of a combination of cumbered with safeguards and procedures that identification numbers or names and passwords to substitute access to it is reduced for both the public and for a signature. A few are developing techniques based on the concept of public key encryption, a mathematical technique the experts. None of these untoward conse- developed in 1977 at the Massachusetts Institute of Technol- quences is inevitable. But the pervasiveness ogy (E.MMS, vol. 9, No. 13, July 1, 1985). Many people den~’ of new information technologies does mean the need for electronic signatures, on a practical basis, saying that messages sent by computer are no different from mes- that government information-handling is likely sages sent by telephone or telegraph. to change in unanticipated ways. 260 ● Automation of America’s Offices —

Over a decade ago Kenneth Laudon pointed a pervasive concern. These issues are being out104 that information about a government addressed in another OTA report, an assess- organization affects that organization in four ment of government information systems.105 ways: Many enthusiasts for information technol- it affects the organization’s reputation ogy anticipate that it will greatly increase cit- with the public, with its primary constit- izens’ ability to know what government is do- uents, and with its employees (and, al- ing and how, and to use that information to though not mentioned by Laudon, with evaluate, influence, and participate in public those who oversee the organization in decisionmaking. Four kinds of information Congress); about government are of primary interest to ● it affects the organization’s autonomy— citizens, especially to citizens actively attempt- the more public information there is about ing to monitor or to participate in public deci- the organization’s inner workings, the less sions:106 independent the role it can play in for- ● information about decisionmaking, pol- mulating policy; icies, and practices internal to an agency ● the loss of full control over internal information tends to make an organization –budgeting and programming priorities, defensive and may lessen its own propen- planning, key appointments and assignments, the locus of authority for specific sity to self-evaluation; and actions and decisions, the actions of spe- increased public information constrains cific officials, etc.; the informal accommodations an organiza- ● tion can make with influential actors in evaluations, reviews, status reports, and its environment (congressional critics, in- other policy-relevant information from ac- terest groups, other agencies, etc.). tors external to the agency, such as administration officials, congressional oversight In short, when the flow of information within committees, etc.; and from an organization becomes less con- ● intermediate and final outcomes of spe- trollable, the organization tends to react in cific cases and decisions, especially indi- ways that are sometimes desirable, from the vidual client problems such as social secu- standpoint of democratic responsiveness, and rity eligibility or income tax appeals, and sometimes not desirable. It cannot be assumed other personal data; and a priori that information technology makes in- ● information about the costs of agency de- formation management more efficient, from cisions and actions to citizens-paperwork the viewpoint of organization managers; nor burden, personal records disclosure, ineq- can the relationship between information man- uities in application of regulations, etc. agement and effective performance of an agency’s mission be fully anticipated. Citizen access to the first two kinds of information has been widened by the Freedom Another major concern is the way in which of Information Act and other laws. Particu- information technology may be used either to larly when organized into public interest increase government’s collection and use of groups, citizens are generally able to obtain information about individual citizens, or to increase citizens’ access to information about (“Government Information Systems, forthcoming from government. Abuse of the capability to col- OTA Communication and Information Technologies program later in 1985. lect, aggregate, and use information about wThis analysis draws on that of Donald A. Marchand and citizens, to violate the citizen’s privacy, or to Mark E. Tompkins of the University of South Carolina, pre- make the citizen more visible to government sented before the panel on Information Control Policy at the Annual Conference of the American Society for Public Admin- and more susceptible to its control, has been istration, Phoenix, AZ, 1974, and later published as ‘‘ Informa- tion Management and Use in Public Organizations: Some Im- “’’Kenneth Laudon, Computers and Bureaucratic Reform pacts on Citizen Participation, ” State and Local Government (New York: John Wiley & Sons, 1974). Review, September 1981, p. 103. Ch. 9—The Automation of Federal Government Offices ● 261 such information readily. Information technol- work, narrowing of options, or political power. ogies make it easier and less costly for an The same is true in many cases for those who agency to supply such information when would benefit from government action. Thus, demanded by citizens. Some agencies are giv- “the poor, ” the “disadvantaged,” or the “small ing citizens direct access to such data through businessman’ who are targets of government information systems. programs, may not even know that they are or would be affected. The citizen has much less access to information about the status or progress of his or Information technology could be of help to her individual dealings with government agen- both citizens and government agencies in mak- cies as a client; for example, in appealing in- ing this kind of data available.109 Office auto- come tax decisions. Here the individual is de- mation could improve the ability of agencies pendent on the agency to give up information, to target the recipients of their services and has no means, technological or otherwise, through conducting surveys and analyses, im- to access it directly. But the agency can use proved special census counts, and collection information technology to collect, or at least and analysis of information about clients as to aggregate, process, use, and disseminate a group. It can be designed to improve the information about the client. In this case, “the handling of client correspondence and to al- client’s information-processing relationship low customized response to inquiries. How- with the public agency is likely to be one- ever, information technology can also be im- sided. . . . the client must reveal information plemented in such a way that relationships about himself to get services from the public between government and constituents are fur- organization. 107 ther standardized and dehumanized, or information delivered to constituents becomes so The thrust of this argument is that infor- highly technical and jargon-laden as to become mation technology improves the agency’s abil- useless to those who are not highly educated it y to get or use information about the citizen or even to those who are not specialists in fields as client, but does not improve the client abil- such as contract law, taxes, or health deliv- ity to know about the progress or outcome of ery. Mechanisms such as forms for request- his or her own case as it is handled by an ing information from, or delivering informa- agency. But even the first kind of benefit can- tion to, a citizen are often designed for the not always be assumed; that is, that agencies convenience of the computer, or data proces- will have better data about clients. As already sor, rather than for clarity to the citizen. noted, New York City social services workers reported that many of their clients ignored, This creates a real possibility that informa- failed to understand, or were intimidated by tion technology, unless used with care and standardized forms, and also that erroneous judgment, could further increase the disadvan- information fed into the automated system tages confronting those who are already educa- could not be caught and corrected until late- tionally and economically disadvantaged. The in the process. 108 In this case information tech effects of information technology on the de- nology may have degraded the client informa- livery of government services, and more im- tion going to the agency, without improving portantly, on the quality and equity of gover- the citizan/client control over it or access to it. nance, must be carefully monitored so that corrections can be made if needed. The fourth kind of information, about the direct and indirect costs of government action — to the public, is diffuse and hard to make spe- “WThis is not the conclusion of the authors cited above, Marchand and Tompkins, who conclude on the contrary that cific. Citizens have difficulty in figuring out information technology is of little direct help to either the agency exactly what a change in policy or procedures or “the citizen as victim. ” They argue that because informa- would cost them in taxes, additional paper- tion technology and the ability to access and use it is not equally available to all, it has distributive effects on the ability of citizens “’-Marchand and Tompkins, op. cit., p. 106. to use information about government to monitor and influence “’The Effects of Office Automation on the Public Sector policy; current information policy has regressive distributive 14rorkforce-A Case Stud.~’, op. cit. (OTA contractor report). effects—it benefits the well-to-do more than the disadvantaged. Chapter 10 Office Automation in State and Local Governments Contents

State Government Office Automation Planning and Procurement ...... 265 The Extent of Automation in Local Governments...... 267 Perspectives on the Effects of Public Office Automation ...... 269 The Effects of Local Government Automation ...... 269 Examples of Office Automation in State and Local Government ...... 271 The State of South Carolina ...... 271 New York City...... 275 Unanswered Questions About Information Technology and Governance ...... 279 Figure Figure~No. Page 10-1. An Example of a Statewide Integrated Communication Network for South Carolina ...... 273 Chapter 10 Office Automation in State and Local Governments

There are 50 State and about 78,200 local cent in 1979; local government’s share grew government units’ in the United States. To from 50 to 59 percent.’ Federal budget cuts make general statements about their activi- and the phase out of Federal grant programs ties is always difficult; one of the benefits of could bring about a massive transfer of admin- a Federal system is that the diversity of their istrative responsibility from central to State approaches to problem-solving provides a liv- and local levels of government. This provides ing laboratory for public policy formulation. a further strong incentive for seeking greater efficiency. The workload in State and local government has increased more rapidly in recent decades These governments are automating their than that of the Federal Government. Between offices at different paces and following differ- the end of World War II and 1980, State and ent strategies, and the consequences will be local government employment increased stead- different for each governmental unit. Much ily to a high of 13.3 million. It has since slightly of the information now available comes from declined, as pressure for increased adminis- the limited number of case studies of individ- trative efficiency and cost reduction has ual jurisdictions. Many of these case studies grown. As a percent of total public sector em- have a narrow perspective, being focused on ployment, State government employment in- public administration criteria of cost-effective- creased from 16.5 percent in 1950 to 23 per- ness. Relatively little literature is available as This includes about 3,000 counties, 19,000 municipalities, yet dealing with effects of office automation 17,000 townships, 15,000 school districts, and 26,000 special on governance, policy, or political respon- districts (when they are fiscally and administratively separate siveness. from other governmental units). At the beginning of World War II there were about 156,000 local government units, or 49 percent more. The big reduction was the elimination of over 93,000 ‘U.S. Department of Commerce, Bureau of the Census, school districts during the 1950s and 1960s, by consolidations. Public Emploj~ment in 1983, GE83-No. 1,

STATE GOVERNMENT OFFICE AUTOMATION PLANNING AND PROCUREMENT Some State governments have gone much of control over information processing there further than others in computerizing their is wide diversity. Some State governments offices. Tax and finance operations, person- have realized that computers represent the pos- nel records, and routine recordkeeping are sibility of a fundamental change in the way however thoroughly automated in almost all public affairs are administered, and have estab- States. It is common for a number of State lished long-range plans and strategies for ef- agencies to share a data processing center, but fective use of the technology. Other States there are usually several or many processing have not gotten beyond treating office auto- centers within a State government. In plan- mation as merely the latest marginal improve- ning, procurement, management, and degree ment in office equipment. Some have let of-

265 266 ● Automation of America’s Offices

fice automation happen to them, unplanned their ability to maintain their control over pub- and incrementally, and are now struggling to lic purchasing (especially physical specifica- rationalize these changes. tions, terms, and conditions of price competi- This is reflected in procurement strategies. tion) because of the powerful market positions Some States have governmentwide master of a few firms. In this large but disaggregated and dispersed market, it was difficult for State plans for investment in information technol- governments to make effective demands re- ogies while some expect planning to be done garding physical specifications of systems or on an agency-by-agency basis as part of the to specify the terms and conditions under budgetary process. Many States, after some which they would do business with computer floundering, have developed procurement controls and standards for large computer sys- system vendors. The Council of State Govern- ments warned in a 1975 report that: tems, only to be taken by surprise by the infiltration of small computers and word proc- There are factors at work which defeat cer- essors, which generally fall below the thresh- tain long-standing principles of public pur- old cost that requires centralized procurement chasing. . . . The effects of oligopoly are mul- 5 approval. tiplying. Minnesota, for example, has highly central- This led the American Bar Association to ized planning and control of information sys- develop a Model Procurement Code for State tems, while in New York State the responsi- and Local Governments, which was published bility is almost completely decentralized. Other in 1979. Many States have since developed States fall along the continuum between these their own standard contracts and agreements. poles.3 Most States do, however, have some As State officials have become more knowl- central office or division that coordinates in- edgeable and experienced with computer tech- formation-technology procurement, if not long- nology the problem has eased. range planning. This office is usually within But more recently, stand-alone word proc- a department of administration or general serv- essors and personal computers (PCs) have in- ices, or in the department of finance. Some troduced a new element of uncertainty, since States, however, give the responsibility for their cost is low enough that their purchase such coordination to a special commission. For may not require centralized approval. It is com- example, in Florida, the Information Resources mon for State agencies and local governments Commission, made up of the Governor and six to find that equipment from several different major State officials, reviews agency informa- vendors have found their way into government tion-technology plans. In Texas, the Auto- offices with no central plan for—or even in- mated Information Systems Advisory Panel, ventory of—their spread. For example, one with a similar role, has both public and pri- State government report acknowledges that vate sector members. “thousands” of PCs have found their way into State and local governments are regarded large organizations by the ‘end-user end- as the largest single market for the microcom- around, that is, users avoiding bureaucratic puter industry in the next few years.4 During purchasing procedures by buying their PCs the early period of acquisition of government below required dollar review levels.’” computer systems, States were concerned over At the State level as in large corporations, ‘Many of the examples in this section are taken from an microcomputers and stand-alone word proc- OTA contractor report, A Comparative Review of Information essors are almost always superimposed on an Technology Management Practices in State Government, prepared by the Institute of Information Management, Technol- existing pattern of centralized computing. A ogy, and Policy of the University of South Carolina, John C, Kresslein, research analyst, December 1984. ‘J. Robert Ippolito (Director, Division of Electronic Data ‘The Council of State Governments, State and Loczd Gov- Processing, Florida Department of General Services), “Com- ernment Purchasing, Lexington, Kentucky, 1975, p. 7. puter Technology Procurement: Can It Be Standardized for ‘State of South Carolina, Division of Information Resource State and Local Governments?’” State and Local Government Management, Personal Computers in State Government, May Review, vol. 13, No. 3, September 1981, p. 85. 1984, p. 2. Ch. 10—Office Automation in State and Local Governments ● 267 report on personal computers in the govern- State office automation is not limited to ment of South Carolina notes that this has computers in the State House or capital city; caused a rethinking of management strategy: increasingly, it is including sophisticated systems to provide an interactive network be- In 1979, when the Division of Information Resources Management began its original of- tween dispersed nodes of government services. fice automation efforts, the PC was not a via- At least two States, California and South Caro- ble end-user device for integration into the lina, are planning digital “backbone” networks State’s office system model. , . . However, we to link together centers of government activ- now see the computing landscape changing ity around the State. Alaska has an audio- to a three level model in which: Level 1 is the conferencing network connecting 70 sites across corporate mainframe node; Level 2 is the de- the State and 17 full-time information offices partmental (minicomputer node; and Level that are also networked. Michigan has a dis- 3 is the personal computer node. These levels tributed network throughout the capital com- more closely match the organizational hier- plex, with a terminal in every senator’s and archy. At the time of this writing (1984) representative’s office. DIRM has begun efforts to provide management direction and support for the PC and State legislatures, as well as administrators, is developing strategies to integrate the PC are using computers. Most States have elec- into its overall State Plan on Technology. tronic data processing systems for statute (Emphasis added,)’ search and retrieval and reporting on the sta- This State government anticipates, accord- tus of bills before the legislature.g ing to the report, that by the end of the decade there may be one PC for every State government office worker.

. — ——— ‘Linda Schulte, “A Survey of Computerized Legislative In- ‘Ibid. See the case stud~ cm South Carolina government formation Systems, “ La% Library Journal, \’ol. 72, winter 1979, use of computers later in this chapter. pp. 99-129.

THE EXTENT OF AUTOMATION IN LOCAL GOVERNMENTS By the mid-1970s most large counties and widely sought applications. 1° More recently, municipalities were also using computer sys- however, a large number of sophisticated ap- tems for high-volume data processing.9 By plications have been developed for use by lo- 1980 these governments had an average of 31 cal governments, both in the processing of data operating applications and as many as 30 un- for routine operations and in the analysis of der development, and were spending an aver- information for broader purposes of manage- age of $500,000 yearly for automated data ment and planning.11 processing. The systems tended to be used first Larger governments usually bought or leased and most pervasively for departments of fi- equipment and developed in-house technical nance. Recordkeeping and printing were other staffs, often developing their own software. Others depended on contractual agreements ‘James ,N. Danziger, “The Use of Automated Information for specific computer applications with a corn- in IJocal Government, ” American Beha\rioral Scientist, vol. 22, No. 3, January-February 1979, pp. 363-392. A survey by the —— —— .— —-. Urban Information Systems Research Group of the Pubhc Policy “’Robert E. Sellers, “Mini- and Microcomputers in Local Research organization indicated that more than 90 percent of Government: Their Application and Their Impact, ” State and cities with populations of 50,000 and larger, and 90 percent Local Go\wrnment Re~’iew, September 1981, p. 91. of counties of o~rer 100,000 people had computer systems, while “tJohn Leslie King and Kenneth L. Kraemer, “Information less than half of those smaller had them. Kenneth I.. Kraemer, Systems and Intergovernmental Relations, ” Public Sector Per- W’illiam H. Dutton, and Alana Northrop, The Afanagement of formance. .+! Conceptual Turning Point, Trudi C. Miller (cd. ) Information Systems (New York: Columbia University Press, (Baltimore: The Johns Hopkins University Press, 1984), pp. 1981), p. 8, 102-130. 268 ● Automation of America’s Offices puter services/time-sharing company. In a few them were using microcomputers, although cases local governments acquired computer about one-third planned to buy one or more systems but hired a facility management con- during the next 2 years.16 Most of those that cern to operate them, or two local governments had computers were using them for word proc- (e.g., a city or county and a school system) essing and financial management. developed a jointly owned and operated com- Of the more than 19,000 U.S. municipalities, puter center. ’2 over three-quarters have populations of less End-use computing is now spreading in the than 6,000. These small towns or villages usu- government agencies of large cities.13 Public ally provide the same basic services as larger Technology, Inc., surveyed its member cities cities—utilities, fire and police protection, rec- and counties with a population over 400,000 reation, taxing functions, usually school sys- in 1983 and found that among the 50 respond- tems, and often planning departments. In addi- ents, 75 percent had microcomputers. By then, tion, they have many responsibilities under 93 percent had one or more minicomputers, Federal programs, such as administering rev- and over half had mainframes. A similar sur- enue sharing and block grants.17 They too are vey in 1984 indicated that 77 percent of 84 trying to cut costs and increase productivity. cities responding (80 percent response) had In spite of this obvious need it appears that microcomputers, and 87 percent planned to small local units, especially those in rural areas, have them by 1984. ’4 There are already hun- are not rushing to computerize their offices .18 dreds of local government applications pro- However, it is possible that the purchase grams available for microcomputers. of microcomputers by small governments has But despite the low cost of small computers, accelerated in the last 2 years beyond expec- most small local governments have not yet tations. As late as 1982, lack of familiarity begun to use them. A survey in 1983 of 162 with computers was probably the major fac- local governments within the State of South tor impeding their purchase by small cities; Carolina found that 81 percent were using com- until recently there were likely to be few computers of some kind, but this usually repre- puter vendors in small towns and this market sented centralized computing, or large-volume was not being aggressively pursued. This may data processing. While 3 of the 6 large cities have changed considerably by 1985. were using microcomputers, only 3 of 27 counties, 1 of 12 medium size cities, and 6 of 53 15 “Donald F. Norris and Vincent J. Webb, Microcomputers: small cities had acquired them. Baseline Data Report (Washington, DC: International City Managers Association, July 1983), as reported in Donald F. The International City Managers Associa- Norris, “Computers and Small Local Governments, ” Public tion (ICMA) surveyed 5,808 cities of all sizes Administration Review, vol. 44, No. 1, January-February 1984, pp. 7off. in 1982, and found that only 13.2 percent of “Sellers, op. cit., p. 91. ‘“Another survey in 1982 looked at cities and counties in seven Mountain and Plains States. Of 75 cities with populations of 2,500 to 50,000, 68 percent were using computers; of “Sellers, op. cit., p. 93. 75 counties under 100,000, 36 percent. Smaller communities “See Special Symposium on Microcomputers in Local Gov- were less likely to have computers than larger ones—41 per- ernment, A Public Administration Review, vol. 44, No. 1, cent of those with 5,000 or fewer people compared to 76 per- January-February 1944, especially James R. Grieseemer, cent of those with more than 10,000 people. Those with city “Microelectronics and Local Government: New Economies and managers were much more likely to have computers than those New Opportunities, ” p. 57. with mayor/council governments, and metropolitan counties “’’C-TAC Survey Reveals Members’ Information-Handling were more likely than rural counties to use them. About one- Resources, ” Public Technology, vol. 5, No. 11, November 1983. third of those who were already using computers, but only 16 The 1984 data was reported in Joey P. George, “Who Does percent of the nonusers, planned to buy more in the next 2 the Buying?” Government Data Systems, August-September years. Over three-quarters of those that were using computers 1985. had a minicomputer or “bookkeeping system’ and only 22 per- “State of South Carolina, The South Carolina Local Gov- cent had microcomputers (7 percent of all the cities surveyed). ernment Survey of the Use of Computer and Communications Most were using their computer system for payroll and account- Technology, prepared by the Institute of Information Manage- ing, budgeting, and utility bills. Ninety percent had only one ment, Technology, and Policy, University of South Carolina, computer, and only 1 percent had as many as four. Norris, op. 1983. cit., 1984. Ch. 10—Office Automation in State and Local Governments 269 — — —-

PERSPECTIVES ON THE EFFECTS OF PUBLIC OFFICE AUTOMATION Early commentaries on State and local gov- port and training required, would so far exceed ernment use of computers tended to be theo- investment costs. The first phase of computeri- retical rather than empirical, and often took zation, at least, may not have reduced labor one of three basic perspectives:19 costs but rather stimulated the hiring of clerks because it required input of massive amounts ● Information technology will rationalize 2o of data. There were widespread expectations not only operating procedures but the po- of a shortage of trained personnel in local gov- litical/policy process. ernment .21 ● Adoption of information technology will be driven partly by “the technological im- Other effects were mixed but generally fa- perative” and partly by the self-seeking vorable. In some jurisdictions administrative actions of a technical elite, uncontrolled control was improved, and workers reported by humane values and unresponsive to increased job satisfaction. There are indica- public attitudes. tions in many cities that office automation Information technology is no different tends to reinforce, rather than change, exist- from other technology and other kinds of ing patterns of bureaucratic and political pow- information resources, and will have no er.22 Some social scientists make this point unique or discernible effects on government. more strongly, concluding that computerization of local government has benefited those The first of these perspectives tended to be who already have broad power and control in found in public administration literature, while the local hierarchy. They usually argue that the second tended to come from political scientists, perhaps reflecting the different relative “K. I.. Kraemer, J.N. Danziger, and tJ.1,. King, 4’I.ocal Go\- ernment and Information Technology in the United States, values that the two disciplines place on effi- Local Government and Information Technology>, In formatics ciency and responsiveness. Studies No. 12, OECD, Paris, 1978. -’J. L. King, “Local Government [Jse of Information Tech- Enthusiasts often saw automation as a way nology: The Next Decade, Public Administration Rmriew, vol. of achieving the goals of the old reform move- 42, No. 1, January-February 1982, p. 31. --For example, a study of 42 cities from 1975 to 1979 found ment, and claimed that technology would in- evidence for improved administrative control and operating per- crease productivity, cut costs, improve deci- formance, especiall~r where computers were used for routine sionmaking, allow better management control tasks, for example, tax recordkeeping and traffic-ticket processing. In applications, such as support of police detect ii’es’ of operations, improve job satisfaction, and investigations or planning and policy anal?wis, the results were allow streamlined governments to offer more mixed or marginal, or the evidence was ambiguous. P: ffects and better services. Critics feared that it would on job satisfaction and the office work en~’ironment were said to be beneficial; the researchers said that this was often an lessen the responsiveness of bureaucrats to unplanned, unanticipated benefit. citizens, put a technological elite in charge of The same survey concluded that there was some e~’idence the local political process, shift power from that office automation reinforced existing pat terns of bureaucratic power rather than changing them. 1 n most cases, a trend elected representatives to hired managers, de- toward centralized, professionalized management in local gov- skill jobs, and greatly increase the costs of government seemed to be strengthened as a result of automation. ernment. The perspective of the research group in this case was clearly that of public administrators who placed high \alue on rationalizing government activities. They found that the most suc- The Effects of Local Government cessful implementations of automation were ‘‘alwa~rs linked with the most advanced and sophisticated technolo~’ and Automation a highly professionalized work force; the sociotechnical approach, emphasizing “user-friendly” equipment, human relationships, Some local governments were indeed taken and worker in~’oli’ement in planning and decisionmaking, often aback by the costs of office automation be- worked best from the perspective of indi~’iduals, but at the cost of some sacrifice of efficiency.‘*Evaluation of Information Tech- cause they had not anticipated that the life- nology in I.ocal C~o\’ernments, 1975-1979. a sur~’e~’ by the ur- cycle costs of the equipment, with the sup- ban information systems research group of the Public Policq’ Research Organization, reported in Kraemer, et al.. op. cit., ‘Danziger, op. cit. pp. 27ff. 270 ● Automation of America’s Offices

there is a need for explicit democratization of There are many examples of local govern- government computer strategies.23 ments using information and communications technologies in innovative ways that can be Local governments collect and use informa- copied and adapted by other communities. For tion for two broad categories of activity—man- example, Jacksonville, FL, is using electronic agement of routine government operations, 24 printing and a local-area network to keep its and planning and analysis. Most of the in- city ordinances up to date. Amendments passed formation systems and applications in use are by the city council are immediately incorpo- for operational purposes-management of gov- rated in the code, and supplements are printed ernment revenues, payrolls, etc. But local gov- four to six times yearly, whereas formerly the ernments must collect and use information for one supplement per year required 6 months scores of activities; two middle-size cities, in and up to $50,000 to prepare. The Office of 1980, identified over 300 distinct operational General Counsel reports that it has reduced information systems (not all then computer- 25 costs by “eliminating the need for a large staff ized). This operational data, in summarized of editorial lawyers, printers, typesetters and or aggregated form, is also useful for planning other personnel. ” Boston has required its licen- and management, especially status reporting, see for cable television to link with a coaxial performance analysis, and compliance analysis. cable network all public buildings, including Computer programs and models have been municipal offices, schools, and fire and police developed for these purposes, including, for ex- buildings. The system provides electronic mail, ample, fiscal impact analysis, land use, trans- and the city’s 29 word processor systems will portation analysis, urban development planning, be part of the network. During the last mu- and expenditure forecasting models. Many of nicipal election a direct link was setup between these are in the public domain and others are the ballot counting at City Hall and local tele- readily and inexpensively available; but rela- vision and newspaper offices.27 tively few governments have used them, and San Diego developed a computer-based plan- these are primarily the larger municipalities. ning and management system to determine It maybe that most local government organi- the most cost effective location for the city’s zations do not yet have the expertise required service units in order to reduce travel to and to use these tools, but it may also be that mod- from work sites. By reassigning crews and eling does not fit the informal, pragmatic, per- equipment among existing stations the city sonalized mode of decisionmaking character- will realize an immediate net cost saving of istic of government close to the grass roots 28 26 over $445,000. Fort Collins, CO, installed an of democratic government. automated information system for use by po- “James N. Danziger (University of California-Irvine), Com- lice officers that allowed it to eliminate one puters and Politics: High Technology in American Load Go}T- position in the Records Department, freed ernments (New York: Columbia University Press, November 1981). room for three additional workstations, and “This analysis draws heavily on the conceptual framework increased the reliability and integrity of crimi- provided by King and Kraemer, op. cit., see especially pp. nal justice information. 106-110. “King and Kraemer, op. cit., p. 107. The effect of the advent of personal com- “An analysis by Professors King and Kraemer of the University of California-Irvine concludes that in terms of pro- puters in local government offices, even if it ducing improvements in performance, most attempts to use is now occurring more rapidly than was ex- these models for planning and management have been “practi- —. cal failures, ” because of several problems: data–especially if it is to be used to evaluate performance. ● Information collected for operational use is generally not –The assumptions used in constructing models may be aggregated at the appropriate level for, or organized for, unrealistic in a specific situation and location, given the planning and management purposes. I.ocal governments diversity among American communities. collect relatively little data appropriate for assessment of —Models tend to be used to rationalize or defend decisions output. already made for political or other reasons rather than ● Models must be fitted to the expected analyses, and this to help make decisions. level of analytical competence is not always readily (King and Kraemer, op. cit., p. 108.) available. ‘-Reported in “The Government Office, ‘ Office Administra- ● Behavioral and political constraints: tion and Automation, September 1984. –Data useful for performance and compliance analysis ‘hInformation provided by Public Technology, Inc., to OTA often depends on self-evaluation by government officials from a list of PTI computer-technology award winners, No- and this affects their behavior in collecting/reporting the vember 1984. Ch. 10—Office Automation in State and Local Governments 271 .— pected in 1982, will not be apparent for some uneven rate, and in many governments with time, especially since they are likely to come little attention at the highest level of man- into use without systematic planning, at a very agement.

EXAMPLES OF OFFICE AUTOMATION IN STATE AND LOCAL GOVERNMENT In the absence of a large body of cross- essing some State agencies had underesti- jurisdictional comparisons, some brief case his- mated the costs by as much as 50 percent. In tories are presented as illustrative of what is a decade, expenditures for managing data had taking place in government offices. They are more than tripled; and outlays for telecommu- not necessarily “typical,” but they provide a nications in 1980 were 38 times greater than picture of some of the possible outcomes of in 1960.30 office automation for States and munici- The Governor, the State Budget and Con- palities. trol Board, and leaders of the State legisla- The State of South Carolina ture agreed that something must be done. The time was right since the legislature was then South Carolina falls about midway among working on a new Model Procurement Code. the 50 States in size (it ranked 24th in terms The consensus across branches of government of population, in 1980) and in government rev- was important, because power in this State enue per capita (38th in 1980). Like other government is particularly fragmented and dif- States, South Carolina began to acquire com- fuse. The heads of major State agencies are puter systems during the 1960s and 1970s. elected separately rather than appointed by In 1981, South Carolina was spending as much the Governor, and therefore tend to have their as 6 percent of its operating budget for tele- own unique relationships with legislators as communications, data processing, and office well as their own constituencies. The Gover- automation, but without any systematic plan, nor consequently must often depend on powers strategy, or control over these expenditures .29 of persuasion to initiate any change within the In buying equipment or services for data proc- State bureaucracy. - ‘This section relies heavily on work done for agencies of With a powerful consensus among State the State (especially the Division of Information Resource Man- agement of the State Budget and Control Board) by Donald leaders that some way must be found to cut A. Marchand, John C. Kresslein, and others at the Institute the burgeoning costs of information manage- of Information Management, Technology and Policy, College ment, it was possible to take action. The State of Business Administration, University of South Carolina. Reports, to be referenced at points in this section as “South administration began efforts to develop a com- Carolina (number), ” include: prehensive information resources management 1. Information Resource Alanagement: A Statewide Strat- strategy. Key officials throughout government e~’, April 1983. 2. The South Carolina Local Government Sur\’e~’ of the Use were interviewed, and State agencies were of Computer and Communications Technology, November asked to develop productivity objectives. On 1983. this basis a preliminary State Plan on Tech- 3. Implementing Information Resource Jlanagement in State Government: The South Carolina Experience, Research Re- nology was developed, and later a Master Plan. port RR-84 -l(K-84-8), May 1984. Agencies were asked to prepare their own 3- 4. Personal Computers in State Go\rernment, May 1984. year plans for use of information technologies. ,.5 A hfanager’s Guide for Implementing Information Re- source ,$ fanagemtmt (IIiM) in a State ,4gencj’, ,June 1984. The Department of General Services was re- 6. Office Automation in the Office of the Go~rernor, tJanuary 1985. organized to create a new Director of Infor- 7. Initial E}’aluation of Prcductivit} Benefits Achie\ed From mation Resource Management and a division S0,4PS, Progress Report No. 2, tJuly 1983. by that name (DIRM) under the Budget and However, neither specific State agencies, the Institute, the university, or the authors cited abet’e are responsible for the Control Board. Another important step was interpretation and analysis in this section, which is solel~’ that of OTA analysts. South Carolina (5), p. 5. 272 ● Automation of America’s Offices the creation of a new series of personnel clas- the legislature in 1981 provided strong induce sifications under the title Information Re- ments for agencies to comply with standards source Management, to encourage the appoint- formulated by the Department of General ment of such specialists in each agency. Services’ new DIRM. DIRM must oversee any procurement of over $2,500. The State would The State Plan, as it developed, encom- coordinate long-term contracts under which passed office automation, telecommunications, agencies would receive a significant discount and large-scale data processing technology. on computer-related purchases. Office auto- The backbone of the planned technology is to mation standards were developed in 1982 and be a statewide microwave network for voice, subsequently revised. data, and video transmission. (See figure 10- 1.) This network, which is planned for comple- By September 1983, an electronic network tion in 1986, will cost an estimated $16 mil- linked the Governor’s Office with nine critical lion, but is projected to save the State $100 agencies within the State House Complex— million over the next 20 years. The State “did the office of the Executive Director of the State not set out initially to establish its own com- Budget and Control Board, the Health and Hu- munication system, ” university consultants man Services Finance Commission, the De- say, “but sought instead the most cost-effec- partment of Agriculture, the Division of Hu- tive alternative with the goal of controlling man Resources Management, the Department communication costs. “31 The planners sought of Social Services, the Office of the Secretary and got bids from 25 private industry vendors of State, the Department of Insurance, the Di- but none could provide what was wanted. vision of General Services, and the Division of Information Resource Management. Another aspect of the State Plan was a systematic approach to office automation (mean- For automating the Governor’s Office two ing, in the beginning, large-scale computer ap- minicomputers were linked to host computers plications). An 18-month pilot project was at DIRM and the University of South Caro- begun in August 1981. Task forces and study lina; there are 22 workstations, 3 data proc- groups were formed to consider procurement essing terminals, 7 letter-quality printers, a and standards, ergonomic issues, training line printer, and a data processing printer. A needs, user perceptions, and contingency plan- recent assessment concluded that the result ning and security needs. The major objectives was a 53 percent cumulative time saving in in office automation were: actual time to complete all tasks studied (approximately one-half person year), with an ● automation of formerly manual tasks to average time saving per task of 5.3 percent reduce manpower requirements, 32 or approximately 112 person hours per year. ● direct time-saving applications and work The improvement in time to complete each redistribution to reduce time and man- task was estimated to be about 86.5 percent. power requirements, Three tasks that were done externally are now ● time-saving applications providing oppor- done internally (answering employment appli- tunity to do additional work, and cation letters, approximately 10 per day; pre- ● quality improvements in office products. paring proclamations; preparing 200 news re- The first pilot project was purchase of three lease envelopes, about twice each week) with IBM 8100s and 100 peripherals for the De- an improvement in turnaround time of about partment of General Services in mid-1982. In 94 percent. Nine of twelve typewriters have the following year further advanced data proc- been relinquished for redistribution to other essing applications were installed, and tech- offices. nical assistance was given to other State agen- “South Carolina (6). The specific tasks studied were prop- cies. The Model Procurement Code passed by erty management certification, grant report, audit report, grant award letters and forms, consolidated vouchers (math calculations), updating office personnel lists, preparing governor’s schedule, repetitive letters, commission letters, educational sta- “South Carolina (4), p. 15. tistical report. .

Ch. 10—Office Automation in State and Local Governments “ 273 -—

a) (5

m I r 274 ● Automation of America’s Offices

More qualitatively, the assessment found sometimes not appropriate so that people queued that the successful adoption of the Governor’s to use them in some places while other termi- Education Improvement Act in 1984 was “par- nals were idle. But four-fifths of the clerical tially achieved through the efficient and ef- staff and over half of managers and profes- fective use of the office automation capabil- sionals said that the new systems had im- ities” that were used for creating the text, proved not only their productivity but their completing 100 major revisions, preparing the attitudes toward their work.34 related speech by the Governor with 18 major By 1983 it was clear that personal computers revisions, and performing mass mailings to were rapidly being added to State offices. Their constituents, related to the act. The Gover- prices often fell below the threshold at which nor’s Executive Assistant was quoted as say- there is central oversight. There was concern ing that without office automation capabilities about the potential lack of compliance with the act would not have been adopted in that office automation standards, which could cause fiscal year, or would have contained a lesser compatibility problems later, yet the flexibil- program content. The assessment concluded ity that PCs offer pointed them to becoming that: the “primary office automation workstation, ” . . . (0)ffice automation is indeed initially more university consultants said.35 costly than conventional or semiautomated techniques. It also is extremely difficult to A survey of 10 agencies in early 1984 showed precisely measure the quantitative produc- at least 500 microcomputers in use, and that tivity improvements and equally as difficult number was likely to double during fiscal year . . . to determine the return on investment . . . 1985. The Comptroller General’s Office was However, . . . (automation resulted) in the causing two personal computers to design a fi- pability to produce and distribute informa- nancial reporting system to be used by small tion faster and more accurately and to make State agencies.3’ Several agencies reported that more accurate and timely decisions . . . In- there was a high demand for personal com- deed, the. . . technologies helped improve the puters, and staff members were dissatisfied level of service and the relationship of the Of- and frustrated by the necessity for sharing fice of the Governor to the citizens of this State.33 them. No local area networks (LANS) were yet in place in these agencies and use of shared The Legislative Services Group also auto- hard disks was just beginning. But the two mated (with 200 word processing terminals State universities were planning campus-wide connected to a mainframe) and terminals were networks and four of the agencies were inter- put in the offices of legislators. Through the ested in developing them. system, legislators can access and track bills and amendments and search the State Code The State now requires personal computers of Laws. Word processing, data processing, to be bought under a term contract, so that key-word search, and calendaring are also all agencies enjoy the volume discount and provided. guarantees of support negotiated by the State. It is officially anticipated that by the end of Automating State offices was not accom- the 1980s there may be one microcomputer plished without significant problems. Those for every State white-collar worker. DIRM has identified at an early stage of the process were purchased software packages for PCs that pro those found in nearly every large organization vide ‘English-language-like query capability’ –functions beyond word processing tended and facilitate the downloading of data from to be underused because people had not been mainframes to PCs. PCs and mainframes will taught how to use them; there was sometimes be linked using leased or dial-up lines to allow a mismatch between capabilities provided and those needed; and distribution of terminals was “South Carolina (7). “South Carolina (7), p. 26. ‘South Carolina (6), p. 2. “South Carolina (4). — —

Ch. 10—Office Automation in State and Local Governments ● 275 end-users controlled, preauthorized access to of dissatisfaction. Some—both clericals and central government databases. professionals-felt that their jobs had been degraded, and their own interest in the job Several State agencies and institutions (e.g., eroded. the Department of Mental Retardation, the Tax Commission, a State technical college, and Most said that their own productivity had the State university medical school) are sys- increased; and some said that the quality, tematically developing their own long-range, quantity, and timeliness of services delivered information-resource management plans. by their work units had improved. But in other cases, services have been depersonalized, stand- Throughout the process of automating gov- ardized, and routinized; accountability of in- ernment offices, this State government has dividuals, if not of the government as a whole, used university experts to monitor and report has been decreased. on progress and problems in achieving its stated objectives. A broader assessment from The clerical workers in the three depart- the perspective of effects on delivery of gov- ments are group clerks, office aides, office asso- ernment services, governmental responsive- ciates, technical support aides, and word proc- ness to citizens, and on the locus and exercise essor operators. The clerical work that has been of governmental power is to be undertaken but automated was all done manually until 1982, is not now available. but now requires personal computers, word processors, Automated Forms Systems, and New York City other systems.38 For example, at the Bureau of Child Support (in HRA) a clerical work unit The Mayor’s Office of Operations in New formerly typed between 400 and 600 letters York City cooperated with OTA in studying each week. Now a clerk enters a code to select the effects of public sector office automation forms to be sent to a client from nine forms by encouraging and facilitating a case study that are generated by an automated system. by The Labor Institute of automation in three Clerks at the Income Maintenance Center once municipal departments—the Department of hunted for paper files on particular clients as Finance, the Department of General Services, they were needed by eligibility specialists; now 37 and the Human Resources Administration. the files are called up on a cathode ray tube New York City has for several years been (CRT) and the needed data is printed out. per- under intense pressure to reduce government sonal computers are used in the Real Prop- operating costs and increase revenues. Major erty Transfer Tax Unit of the Department of reorganizations aimed at increasing productivity Finance to call up information on property took place in city government departments sales history and determine the market value both before and during office automation. The of property. Word processors are used for tax case study focused on the consequences of billing, as well as for generating reports, mail- automation for the clerical, managerial, and ings, memoranda, and other documents in all professional work force, and on their percep- of the departments. In one department the tions of how it affected both them and the serv- most proficient typists were removed from ices that they deliver to the public. their old work units and placed in a central production unit. Many of the workers who contributed their insights to this study said that in spite of some “Twenty-eight clerical workers took part in workshops and early misgivings, they like office automation. group interviews for this case study. The~r are predominantl~’ However, there is at the same time a high level women, and predominantly black and Hispanic. host ha~.e completed high school and a few have completed college; they ha~re ~;ffects of Office Automation on the Public Sector ll”ork- worked for the cits’ from 2 to 10 years, and have been using force: A Case Stud~, of Yew York Cit.}, done under an VI’*4 computerized office systems for at least a year. The clerical contract by The I.abor Institute ( N“ew York): ,Joan Crreenbaum, workers spent most of their 7-hour workda~’s using the s~’s- principal in~’estigator, with Cydne~’ Pullman and Sharon Sz~z- Lems, and usuall~’ hate two 20-nlinute breaks, in addition to manski, February’ 1985. 1 hour for lunch. 276 ● Automation of America’s Offices

One goal of city government is reduction of Most of the New York City clerical workers the clerical work force and this has been occur- say that even though they like the new sys- ring. Managers report that the objective is to tems, they also suffer from increased stress. reduce the clerical work force about 15 to 20 They report increased eyestrain, backaches, percent through attrition. The effects of of- and headaches. Many of the new systems have fice automation cannot always be clearly sep- been installed in old offices with unsuitable arated from the effects of reorganization that furniture and lighting, and poor ventilation; either preceded or accompanied it, but much excessive noise from printers, and wires or of that reorganization was itself for the pur- cables stretched haphazardly around the floor, pose of making better use of the new technol- add to the risks to health and comfort. ogy. One work unit manager reported that the Almost all of the clerical workers do more automated systems have already resulted in work than before automation. Some say that a 15 to 20 percent reduction in clerical staff they now have a better understanding of “the over 3 years. whole picture, ” that is, what the agency does Clerical workers said that when automation and how. The sharing of information and co- began, they were fearful of losing their jobs operative learning that has occurred has gen- and afraid that they could not learn the new erally increased the interaction between co- systems. Minimal formal training was provided workers. But frequently this interaction is by vendors. Most of the workers learned from forced; it is an attempt to overcome problems coworkers, and then taught others. Now the caused by lack of supervisory coordination, workers generally approve of the automation, lack of formal training, and problems with the saying that it freed them from tedious man- equipment. The only way that work gets done ual work and allowed them to learn new skills, is by the workers going into a huddle and find- and that they can now produce better quality ing some way to get around the problem. The work, at a faster rate. They also say, however, workers overwhelmingly say that they have that they still need more and better training more interest in their work now, although as and that they are not being adequately com- they fully master the new process some an- pensated for what they perceive as their newly ticipate that it will become boring. learned and higher level skills. In New York’s city government, paraprofes- Because the new systems can handle a larger sionals, who have less formal training than volume of work in a shorter period of time, professionals, can perform some of the work most of the workers work more steadily and of professionals and assist them in other tasks. take fewer breaks.39 Those doing data entry Some paraprofessionals are now using com- in many cases say that their control over their puters and related devices, although usually work has decreased because it is paced by the less intensively than the clerical workers. Typi- machine. However, those in one kind of de- cally, they may review computerized files or centralized word processing pool (“clusters’ scan data for 2 or 3 hours a day interspersed now have relatively more variety in what they with other duties and activities.41 For exam- are keyboarding and also have to prioritize it, ple, in the Bureau of Child Support (HRA) pre- so that they feel they have more control over assignment investigators are now reviewing their work.40 forms, generated by computers, to track down “’Their union, AFSCME, has negotiated two 20-minute information about absent parents who are breaks for VDT users in some work units, but the workers say evading child support payments. In the In- that they do not always take them because they are too busy. Some, however, say that they take informal breaks when nec- come Maintenance Office (also HRA) eligibil- essary to relieve eyestrain and back discomfort. ity specialists use computers to review client ‘“In two word processing units, one a pool and one a cluster, some similar effects were found, including rotation of jobs and prioritization of work; but for different reasons. The cluster is a smaller unit where management encourages worker in- “Nine paraprofessionals participated or were interviewed volvement in everything from selecting equipment to organiz- for this case study, They were predominantly black and Hispanic ing the work. In the word processing pool the increased control women between the ages of 30 and 50, all high-school gradu- that the workers have is due to a virtual lack of supervision. ates, most with some college training, They had worked for As a result, workers must work as a team to coordinate and the city from 5 to more than 15 years and are now using auto- organize the unit’s work. mated data-entry and or data-retrieval s}’stems in their work. Ch. 10—Office Automation in State and Local Governments ● 277 files for recertification of public assistance mainframe computer for data input or inquiry, eligibility. or word processing. Tax auditors in the Tax Examinations Unit use IBM PCs for data in- The eligibility specialists also have exten- quiry and input, and caseworkers in the Bu- sive direct contact with clients by telephone; reau of Child Support use IV Phase terminals they help them with emergencies such as evic- for similar purposes. tions, fires, or illness. These paraprofessionals rate the work they do with computers for about Before automation, tax auditors in the Real 10 hours a week as the most satisfactory of Property Transfer Tax unit handled all aspects their tasks. They report that their productivity of a tax audit. Particular cases and case follow- has increased and the quality of the output up were assigned to one auditor. As automa- improved after automation. The workload has tion is being introduced, this unit, with a staff also increased; because more information is of seven, is being merged into the much larger available they are now required to submit more Examinations Unit, which now handles eight reports, and their deadlines are tighter. Al- kinds of municipal taxes. This represents the though many feel that they have a better sense beginning of a larger reorganization in which of “the whole picture” and more control over all tax auditors in the unit will be trained to their work, many feel that they are overworked, handle all eight types of taxes. Auditors ac- undercompensated, and that the quality of knowledge that the computer generates more services delivery has not necessarily improved. information, quicker, and thus provides more control over the status of each case. Yet the The preassignment investigators in the Bu- auditors are dissatisfied with the overall proc- reau of Child Support also rate their review- ess. With the reorganization of the work unit, ing of files by computer as the most satisfy- the tax audit procedure has become frag- ing of their tasks. They have almost no direct mented and more clericalized. Some of the au- contact with clients, using forms almost ex- ditors are frustrated with what they perceive clusively in processing cases. But while they as a decreasing need for their professional find reviewing these forms more satisfying training and judgment. than their other major task of sending out form letters, automation has not, in their opinion, Analysts in the Office of Management Plan- improved the quality of the services. ning and Analysis say that the improved quantity, quality, and accessibility of data has re- The paraprofessional workers also complain sulted in improved services from their office. of eyestrain, backpain, and headaches, even Unlike other employees participating in the though they spend much less time in front of case study they do not see an increase in work CRTs than do the clerical workers.” because of computers. Rather, the computers Professionals in these three city departments have changed their perceptions of their jobs. vary widely in the extent to which they use The expansion in the amount, speed, and wider computers or other forms of office automation, range of reliable information has given the but their jobs have also been strongly af- analysts more varied and creative possibilities fected.” For example, in the Department of for solving problems. They feel that their in- General Services, analysts in the Commis- fluence has increased as they go beyond iden- sioner’s Office of Management and Analysis tifying problems and become more involved use Wang VS terminals or IBMs linked to a in working out solutions. But caseworkers in the Bureau of Child sup- ‘-Seven of the nine paraprofessionals who contributed port think that the services provided by their directly to this case study have had to get stronger eyeglass unit have definitely not been improved by prescriptions since they began using a VDT. “Fifteen professionals participated in workshops and inter- Automated Forms Service. Some of their views. They included 9 men and 6 women(80 percent were white), clients, they report, ignore all standardized and their ages ranged from 20 to 40, with the average in the forms, others are intimidated by computerized mid-20s. All have college degrees and the majority some graduate-school training. A few have worked for the city more forms and will not respond to them. The than 15 years, but most less than 4 years. caseworkers say that the data fed into the sys-

~2- 644 O - 85 - 10 278 Automation of America’s Offices tern is often inaccurate, and that, thanks to Both caseworkers and auditors, however, automation, errors are not caught until late feel that they have lost some control over their in the progress of a case, which must then be work, because it has been fragmented. Case- held up until the errors can be corrected. Also workers, by being relieved of clerical aspects the system has generated increasing numbers of their work have also been relieved of knowl- of small procedures that not only increase the edge about its progress and outcome. Crucial amount of work but also the chance for errors. steps are taken by other people who do not know the whole story. Auditors do not always These caseworkers, before the automated complete an audit they have initiated, as it forms service was adopted, wrote or typed nu- may be passed on to others. Both the case- merous letters. They no longer perform such 44 workers and these auditors say that their over- clerical duties, but paradoxically their posi- all job interest has decreased. tion is being deprofessionalized. Since they are no longer solely responsible for deciding what Managers, those top-level administrators letters to send out, their control over a case who set broad policies and exercise overall throughout its history is not as complete. Their responsibility for their execution, have also job title is being changed from “caseworker” been affected by office automation, although to “eligibility specialist. ” A college degree is they may or may not use any microelectronic no longer required, and the new job title does devices themselves.45 Some of the top-level not have the range of possible grade levels that managers in these departments use word proc- went with the old title, so that opportunities essors for memos, notes, drafting materials, for promotion are decreased. This job degra- etc. Some use electronic mail and messaging. dation was not caused by office automation, Most also use database inquiry from time to but office automation was used to foster an time; a few reported using spreadsheeting, ongoing process. graphics, list files, and typesetting functions. These managers used a computer from 2 or The professionals as a group have mixed per- 3 hours a week to as many as 15 hours. Mostly ceptions about other effects of automation on they had learned by watching others use the their work. They generally report that inter- systems, but a few had taken courses. actions with coworkers increased, with sharing of ideas about uses of the systems. They Buying microcomputers for managers to use continue to pace their own work to suit them- was said to be much harder to justify “to the selves and the needs of a particular project, city” than buying large systems for clerical as professionals generally can. Some report use. Most of the purchases were approved on an increase in “petty” supervision, apparently an experimental basis. But all of the managers because supervisors can review more drafts said that computers increased the speed and of reports and more easily ask for changes. improved the quality of their work, and allowed Some see the increased use of data (because them to do new kinds of work. Almost all also more is available) as an increase in their work- said that computers increase the amount of load, while others perceive this in terms of more work to be done. options for solving problems. Most think that The managers, however, were more con- their ability to perceive “the whole picture” cerned about the effect of office automation of their agency’s work is enhanced; yet some on their departments than on their own work say this is marred by increased uncertainty habits. Some were eager to use office automa- as to the long-range effects of computerization to reduce the work force and their operat- tion on government. ‘r Seven managers were interviewed in-depth; they include a department commissioner, an assistant commissioner, a dep- “Their work was rationalized and restructured to relieve uty general counsel, and the directors of four major offices within them of some of the paperwork, prior to automation. The cleri- departments. They included 4 men and 3 women, between the cal workers who took o~’er the paper work became overloaded, ages of 28 and 50, who have worked for the city between 1 and Automated Forms Service was brought in to relieve this and 15 years. Their own use of computers varied from ‘‘none, problem. to working (at home) for several years on a computer. Ch. 10—Office Automation in State and Local Governments ● 279 —. ing costs. Others felt that the combination of Since the city civil service ensures that jobs civil service rules and union resistance would and people stay, I feel that this offers us room keep that from happening in the near future, to experiment with using computer tools for but that other changes set in motion by auto- new uses. I see the line between clerical and managerial workers blending. A clerical worker mation would nevertheless have major impacts is not just a clerk and a manager is not just on the delivery of government services. Said a manager. the Commissioner of a large municipal department:

UNANSWERED QUESTIONS ABOUT INFORMATION TECHNOLOGY AND GOVERNANCE In all public sector offices, office automa- To date, the sparse and fragmented litera- tion is increasingly tied to and part of larger ture on government office automation and on information systems, and the effects on qual- the broader topic of government information ity of governance must be considered as a systems, and the case studies reviewed above, whole. In State and local governments this suggest some further questions that should is particularly important because this is the be thoroughly studied. If information and com- level of government most likely to impact munication technologies can, as now appears directly on individuals and households on a highly probable, increase the efficiency of State daily basis. To the extent that this assessment and local governments and decrease their oper- has considered public sector offices, it has been ating costs, what can be done to help the citi- directed almost entirely to the effects of of- zens of small as well as large governmental fice automation on government itself, its pro- units enjoy these benefits? How can office ductivity, effectiveness, and efficiency. There automation be implemented and managed so has been only peripheral attention to the ulti- that it improves, rather than degrades, the mate effects on the constituents and clients work life of civil servants and thus attracts of government offices. to government service capable and dedicated A study of 42 cities, in the first phase of people? Can office automation improve the effectiveness and responsiveness of government, office automation from 1975 to 1979, found as well as its efficiency? improved administrative control and operating performance, increased job satisfaction, Several aspects of governance on which of- and improvements in the offices as working fice automation has a direct bearing were be- environments. 46 The survey also produced evi- yond the scope of this assessment, but are par- dence that office automation reinforced exist- ticularly worth further consideration. One is ing patterns of bureaucratic power, and in most the ability of governments to gather essential cases, this meant a trend toward centralized, information needed to carry out their respon- professionalized management at the expense sibilities effectively. A second is the ability of the power of elected officials. This was one of citizens to know and understand what their of very few cross-jurisdictional studies and also governments are doing—i.e., access to infor- one of even fewer that looked at effects on mation. A third is the ability of citizens to with- power relationships within government. hold some personal information from government—i.e., civil liberties. Finally, there are “‘ 1“: t’aluatif)n of I nf{)rrnation Technolog~’ in I.ocal (lo~’ern- questions about how information technologies ments, 1 W’5- 1979, a sur~’e} of the urhan information s~:stems rest~arch ~rr(jup of the I)uhl ic Polic~ Research ( )r~aniz at Ion, t-e affect the nature and the equitable distribu- ported in Kt-aemer, et al,, op. cit., pp. Yi’ff, tion of government services. 280 ● Automation of America’s Offices

This assessment, although it did not address by means of public information systems. They the question directly, nevertheless indicates are confronting technological, economic, and that office automation can improve the qual- legal problems in doing so, and have so far ity as well as the quantity of information had mixed results. available to government decisionmakers and There are disturbing hints, although as yet planners. It can also make it easier for the rep- only hints, that government office automation resentative branches of governments to exer- can change the nature of government services cise oversight over executive agencies, and for in ways that are not completely desirable. For all branches of government to increase their example, it may standardize and depersonal- analytical and planning capabilities. ize the way in which some services are deliv- However, all improvements in the ability of ered. To the extent that depersonalization or government to gather, integrate, and use in- standardization reduces the likelihood of dis- formation also increase the danger that this crimination, favoritism, arbitrariness, or cor- information can be misused. Questions of con- ruption, it is good. To the extent that it makes fidentiality and civil liberties arise at the lo- government less humane, less sensitive to in- cal and State level as well as at the National dividual needs, and particularly to the needs level. of the handicapped, the poor, and the ignorant, it is not good. To the extent that it results Office automation could also be used to al- in people and their personal needs and prob- low government offices to be more effective lems being regarded as interchangeable, ma- and efficient in responding positively to re- nipulable statistics, it is a deterioration in civil quests for information about government activities. The prevailing Federal policy of in- life. formation resources management, which is These questions, as already noted go beyond now being adopted by many States, is based the scope of this assessment. Some of them, on the principle that information is an eco- especially those related to citizens’ access to nomic resource and is to be managed accord- public information and to the protection of ingly. In itself this principle is not hostile to privacy, security, and civil liberties, will be the objective of increased public access to in- addressed in a forthcoming OTA assessment formation, but it does not necessarily include of government information systems. All of that objective. Some States are, however, mak- these questions should however be the sub- ing concerted and systematic attempts to give ject of serious scrutiny by citizens, scholars, the public access to government information and decisionmakers at State and local levels. .- —

Chapter 11 Office Automation in Small Business Contents

—

The Importance Businesses ...... 283 Factors Affecting the Use of Office Automation in Small Businesses ...... 284 Extent of Office Automation in the Small Business Sector ...... 286 What are Problems? ...... 287 ...... 287 Capital .0 ...... 288 Software ...... Time ...... 289 ...... 289 Training ...... 289 Security ...... Vendor - Responses ...... 290 Future Impacts of Office Automation on Small Businesses ...... 290 The Market for Business Services ...... 291 Productivity ...... 291 Competitiveness and Scale...... 292 Employment and Skills ...... 292 Policy Options ...... 293 Table Table No. Page 11-1. Percent of Firms Using by Size of 1983 V. 1985 . 286 Chapter 11 Office Automation in Small Business

Small businesses play a vital role in our econ- a starting place for more detailed assessments omy, and technological changes could affect and discussions. that role. Small businesses are often a vehicle Purchases of office automation equipment for basic innovations; they create new jobs; by small businesses are rapidly increasing as they serve small, local, and specialized mar- the prices of the equipment come down and kets not otherwise served; and they employ as this market becomes a major focus of ven- marginal resources that larger companies can- dors. Computer systems have been used for not utilize effectively. This chapter provides several years by entrepreneurs and consultants some general background and a summary of working out of their homes, but the hardware the limited information currently known about and software used for this purpose were hardly the effects of office automation on small busi- differentiated from that sold for amateur, rec- nesses. reational, and educational use in the home mar- The first phase of office automation required ket. Now small computers and specially de- relatively large capital investments and much signed soft ware packages are coming into use specialized expertise, and was chiefly imple- by very small firms such as farms, restaurants, mented in large organizations. The availabil- mom and pop stores, and entrepreneurial sell- ity of small computers and software packages ers of business services, as well as for the larger designed for small-scale operation is recent. category of small business, firms with up to Manufacturers and vendors are now emphasiz- 500 employees. They are being used for many ing this market. But very small firms, and in applications, including accounting functions, particular beginning entrepreneurs, are often networking with peers, and research. uncertain and apprehensive about taking the There have been few or no studies on the first steps toward automating their offices. impact of office automation technologies on They would like to know more about the ex- employment, job content, productivity, or sur- perience similar small businesses have had vivability of the small business or beginning with automation, but may find that it is diffi- entrepreneurs. Because of the importance of cult to get objective, disinterested informa- the small business in the U.S. economy, the tion. Researchers and experts in the Nation’s extent of adoption of automated office equip- business schools and universities could help ment in that sector and the problems faced to develop a body of information to fill this in implementation of automated systems by need. Few researchers have studied the effects small businesses merit special attention. on small business. This chapter can provide

THE IMPORTANCE OF SMALL BUSINESSES Organizations with 100 to 500 employees, tise to proceed rationally and systematically although considered small businesses in law toward some form of office automation if they and regulations, tend to have a well-developed choose to do so. But with personal computers, organization structure, formal procedures, and organizations with fewer than 100 employees company policies much like those of midsized can automate. Even very small firms, such as organizations. Over 99 percent of all firms, in a family business or a new venture by one or the United States, fall within this category. a few people new to entrepreneurship, can au- While such firms might not be able to use a tomate many of their office procedures by mainframe computer, they are likely to be able using, for example, word processing, spread- to mobilize the assets and acquire the exper- sheets, and automated mailing procedures. 283 284 Automation of America’s Offices

Such organizations are often the incubators All of the net increase in jobs (984,000) be- of new industries, new products, and new serv- tween 1980 and 1982 was attributable to firms ices. Their problems are often different in kind with fewer than 19 employees.4 These small from those of larger firms. Relatively little is businesses produced a total of 2,650,000 new known about the factors that determine their jobs, more than offsetting the 1,666,000 jobs survivability and growth. For that reason, the lost by larger businesses.’ focus of this chapter is the question of what Small businesses train beginning workers is known about the potential effects of office in needed skills, providing two out of three automation on independent firms having fewer workers with their first jobs in the private sec- than 100 employees.’ Unless otherwise stated, tor; larger firms reap the rewards of this train- the term “small business” in the rest of this ing through increased productivity y due to the chapter means firms having 100 or fewer em- availability of trained workers. Small busi- ployees and the term “very small business” nesses also account for almost half of women’s is usually applied to those with 20 or fewer jobs and provide jobs for the elderly and those workers. wishing to work part-time or intermittently. Such small businesses are a major part of In addition, small firms are said to be more the American economy, accounting for over innovative than large firms and they offer serv- 34 percent of the U.S. labor force, and 32 per- ices considered too differentiated or too small cent of sales.2 These figures do not include self- in market potential to be pursued by large employed workers, who constituted 10 percent firms. of the work force in 1982, making the very This is, therefore, an important segment of small business share of total employment even 3 the U.S. economy. Should Government pol- higher than indicated in most studies. They icies aid small business in their efforts to use are a particularly important part of many in- new technologies such as office automation? dustries, such as agriculture, construction, Can the private sector be encouraged to help? wholesale and retail trade, and business and Or will office automation tend to change or personal services. diminish the role that small business plays in ‘The Small Business Administration has two definitions of the economy? a small business including those with fewer than 100 employees and those with fewer than 500 employees. The latter category includes 99.7 percent of total firms in the United States. An establishment is a business located at one physical site, an enterprise is a business consisting of one or more establishments, and the word “firm” refers to ail establishments under ‘The State of Small Business: A Report of the President, the same ownership or control. op. cit., pp. 26-27. The 1985 edition of the same report did not ‘Executive Office of the President, The State of Smal f3usi- update these figures. ness: A Report of the President (Washington, DC: U.S. Gov- ‘The State of Small Business: A Report of the President, ernment Printing Office, March 1984), p. 73. 1985, p. 2. But many small business firms start up and many “’Job Generation, ” Econom”c Policy in the Eighties: The others go out of business each year. In addition, firms are con- Small Business Factor (Washington, DC: Small Business Ad- stantly moving in and out of this classification due to expan- ministration, June 1984), p. 6. sion, contraction, and purchase by larger firms. This dynamism Nonagricultural self-employment increased by more than of the small business sector is thought by many analysts to 45 percent between 1970 and 1983. Eugene H. Becker, “Self- be a useful indicator of overall business cycles; these cycles Employed Workers: An Update to 1983, ” Monthly Labor Re- are felt by small business 3 to 6 months before they affect large view, July 1984, pp. 14-18. businesses.

FACTORS AFFECTING THE USE OF OFFICE AUTOMATION IN SMALL BUSINESSES The factors affecting the use of office auto- ment, the growth needs of the firm, and the mation technologies in small businesses cen- available labor or skills. The declining price ter around the price and availability of equip- of microelectronic equipment is making it more —.

Ch. n-Office Automation in Small Business ● 285 feasible for small businesses to purchase. Ac- Businesses of less than 100 employees make cess to capital, however, is often still a prob- up over 45 percent of the miscellaneous busi- lem. Even a few thousand dollars in capital ness service industry, and an even larger investment can be significant. High interest proportion of another seven industries ex- rates limit the ability of very small firms, and pected to grow rapidly in the next decade.7 especially new businesses, to invest in capital The miscellaneous business services, the fi- equipment, and the bankers’ interest in lend- nance, insurance and real estate industry, and ing small amounts is minimal. Many small professional services (health and legal), are al- firms simply do not feel the need for computeri- ready heavily impacted by office automation. zation yet, although that situation seems to Personal services, such as beauty shops, dry- be changing rapidly. cleaning establishments and repair services are likely to be less affected by office automation. The targeting of the small business market by manufacturers and retailers has no doubt The availability of people to use the equip- influenced many to purchase and caused most ment will also influence the decision to auto- at least to consider the technologies. The in- mate. More highly trained, specialized person- terest of the vendors is evident from the in- nel such as systems analysts and programmers crease in advertising aimed at small businesses may be needed if the office’s activities are in and the number of small business seminars any way highly specialized or nontraditional, offered by vendors and retail outlets. and only a few specialized very small businesses are likely to have such people, unless The retail computer store has been the most they are themselves the owners/entrepreneurs. common method or site of purchase because The higher cost to the small firm of pension vendors have been unwilling to develop a sales plans and other benefits, the costs of recruit- staff to deal with small businesses. Thus, the ing and hiring these workers, and the small sales effort has been largely passive. The ven- scale of operations and markets put smaller dors now are dealing with that problem by businesses at a disadvantage. Once they have means of seminars oriented to small business automated their operations, however, they are owners and new entrepreneurs, attracting a less likely to be able to employ unskilled neigh- target audience with which their sales forces borhood labor, untrained new or occasional can deal more efficiently. workers, or family employees. The dynamics of the firm and of the indus- The proliferation of incubator facilities that try of which it is a member affect a firm’s need provide computer and telecommunications for and use of automated office equipment. A equipment on a shared basis to small firms business that is growing rather than stagnat- or beginning firms will provide many of them ing is likely to use it to service more clients with their first opportunist y to use such equip- or provide faster response to clients. A grow- ment. Builders are developing “smart building firm is also more likely to have the capital ings” prewired for computer and communi- or credit to purchase new equipment. Strug- cations networks, and are renovating older gling firms sometimes expect that office auto- buildings and furnishing them with electronic mation will allow them to compete more suc- equipment for lease to small business/entre- cessfully with larger firms. For example, a preneurs. Such facilities will provide small bus- small travel agency may find that the addi- inesses with the benefits of office automation tion of a computerized reservation system is 6 at an affordable cost. The number of incuba- necessary for it to survive and compete. tor facilities in the United States doubled in

‘Judith Kamm and Aaron Nurck, “The Organizational Im-

plications of Implementing Technology in Small Businesses” ‘Bruce Phillips and Kim Beverly, “Employment Projec- (Department of Management, Bentley College, Waltham, MA), tions in Large and Small Business-Dominated Industries, 1982- 4th Annual Bentley College Small Business Resource Center 1995, ” draft memorandum, Small Business Administration, Research Conference, spring 1984. Jan. 4, 1985. 286 ● Automation of America’s Offices the last year and shows signs of continued in- small businesses using these facilities, appear crease. They are attracting private investment to be successful.8 - capital as well as private-public partnerships, ’ Business Incubators Are Doubling in Number Each Year, ” and with a two-thirds survival rate for the ~dl Street Journal, Nov. 14, 1985, p. 1.

EXTENT OF OFFICE AUTOMATION IN THE SMALL BUSINESS SECTOR The lowering of prices has allowed small bus- firms the need for specialized software and spe- inesses to begin heavy purchasing of auto- cialized personnel in the small business if they mated office equipment, as evidenced by sev- are to use computerized systems effectively. eral marketing studies. All of the surveys studied indicated that small businesses are conservative in their choice of Although, more large firms use computers systems and the use to which they are put, than small ones, small firms are increasing which is mainly word processing and account- their purchases steadily. Comparison of a 1983 9 10 ing functions. Larger firms are apt to be more Dun’s 5000 survey and a 1985 survey show interested in state-of-the-art equipment and the increases. (See table 11-1.) The increases more innovative applications than are small in purchases for small firms were 60 to 70 per- firms. cent during this short period. In fact, firms purchased more than twice as many computers In 1980, Inc. magazine surveyed its readers during this time as they had predicted they and found 48 percent of the respondents then would in the 1983 survey. using minicomputers and microcomputers or small business computer systems;12 22 percent Small firms responding to the 1983 survey 13 were using word processors. Only 4 years used their computers mostly for accounting later, 57 percent owned/leased microcomputers while the largest firms used them for finan- and 28 percent owned/leased minicomputers. ’4 cial analysis and forecasts. By 1985, the use The median number of employees of these com- of financial analysis/spreadsheets had decreased overall and the “other category” had increased panies was less than 25. Personal computers from 8.5 to 78.0 percent, indicating heavier are used most often by management, followed usage of specialized applications. 11 This con- closely by engineers, clerical and middle management; the most common use is word proc- “Joseph Duncan, “Business Bets on Microcomputers, ” essing, followed by accounting/bookkeeping, D&B Looks at Business, August 1983, p. 45. file/list maintenance, and records/schedules. “Dun & Bradstreet Looks at Business, vol. 3, No. 3 (New Further automation of tasks was planned by York: Dun & Bradstreet Corp., May/June 1985). “Ibid., p. 4, 72 percent of the respondents within the next 2 years. The small business market for communications equipment is also increasing rapidly. It Table 11.1 .—Percent of Firms Using Personal 15 Computers by Size of Business, 1983 v. 1985 was over $3 billion in 1983. The cost of tele-

Size of business (number of employees) 1983 1985 1-19 ...... 14.50/0 23.90/o ‘21nc. Office Technology 1 (Boston, MA: United Marine Pub- lishing Co., Inc., 1980). 20-99 ...... 22.4 36.3 ] ‘Inc. Office Technology 11 100-499 ...... 27,3 47.2 (Boston, MA: United Marine 500-999 ...... 44.5 71.8 Publishing Co., Inc., 1980). ““inc. Personal Computers” (Boston, MA: Inc. Publishing 1,000 or more ...... 65.7 85.4 All firms ...... 31.9 46.1 Co., Inc., 1984), and “Inc. Minicomputers” (Boston, MA: Inc. Publishing Co., Inc., 1984). SOURCE Joseph W Duncan, “Dun’s 5,000 Survey Shows Dramatic Increase in “)Frost & Sullivan, “The Small Business Communications Use of Personal Computers, ” Dun & Bradsfreet Looks at Bus/ness, VOI 3, No 3, May/June 1985 Equipment Market Report, ” A 1254/D-1, winter 1983/84. Ch. 11—Office Automation in Small Business ● 287 phone services is high on their list of prob- cording to the Dun & Bradstreet 1983 survey. lems, according to testimony before the Com- Larger firms were more likely to use personal mittee on Small Business in 1984.16 Small busi- computers in telecommunications link-ups. nesses are faced with much more complex Very small firms often used their microcom- choices now in the selection of telephone and puters to replace a Telex or Twix communica- other communications services, which inten- tions service and were comparatively strong sifies the cost problem. in their use of commercial databases. Most businesses (66.7 percent) used their It is evident from surveys, advertising ef- computers as stand alone workstations, ac- forts by vendors, and retail sales activities, that small businesses are purchasing automated office equipment in increasing amounts. “” Impact of Changes in the Telecommunications Industry Some are purchasing out of genuine need to on Small Business, ” Hearing Before the Special Task Force on the Impact of Telephone Costs, U.S. Congress, L$’ashing- improve their productivity and others are pur- ton, DC, June 26, 1984, p, 405. chasing because the competition is doing so.

WHAT ARE THE PROBLEMS?

The very small business is faced with a ● Security–Lack of knowledge about com- myriad of problems when considering office puter security and little ‘control over automation. Included among these are: shared information systems are a problem that the small business will have to ● Capital-Even though the prices of equip- deal with in the future as proprietary and ment have decreased tremendously over private information becomes more acces- the past few years, this may still be an sible to all employees through computer- expensive undertaking for the very small ized systems. firm whose access to capital is limited. ● Time—A large investment of time is required to evaluate, purchase, and learn Capital to operate new systems. The capital needed to purchase hardware ● Expertise–Small businesses often lack may actually be the lowest cost involved in the expertise and the financial capability converting to automated office equipment. to hire technology experts for evaluation, Once it is purchased and installed, the owner/ implementation, and maintenance of auto- manager needs someone to turn to for help mated office systems. when it does not work and the vendor may ● Training-Small businesses often lack the or may not provide good support. The imple- time and expertise to train operators of mentation costs, which include training and the new equipment. In addition, the cost temporarily lowered productivity, are often un- of training is usually overlooked when expected. The five U.S. industries that are planning the purchase of new office tech- dominated by small businesses—services; re- nology equipment. The result is neglect tail and wholesale trade; construction; finance; of the training function and underutiliza- insurance and real estate; and agricultural tion of the equipment. services have capitalization rates much lower ● Repair services— Equipment is often pur- than industries dominated by large businesses. 17 chased at retail outlets and the follow- up services are not available in a timely manner. ● Software-Much packaged software is available for small businesses but it may ‘-Bernevia McCalip, et al., “The Sensitivity of Small Busi- nesses to Interest Rate: A Cross Sectional View, Congres- not be entirely suitable to a firm’s spe- sional Research Ser~ice, U.S. Congress, I.ibrary of (’ongress, cific needs. Washington, DC, May 26, 1982, 288 ● Automation of America’s Offices —— —— —.——

system was implemented; and failed to become involved in the switchover. The owner blamed the equipment vendor and the software supplier and they blamed the business owner. The equipment has been reclaimed by the vendor and the owner is suing them. 18

Software The problems and costs of choosing suitable software are even more significant than those

involved in choosing the hardware. Larger firms often have software designed specifically for their use. In these companies, programmers can spend 60 percent of their time doing maintenance on programs.19 This is not feasible for the small business manager. Small firms must make do with packaged software that often does not work well for them, and the developer is unavailable to them for consultation, A survey by the U.S. Chamber of Com- merce in 1984 found that half of the respondents felt the need for more information than was found in their software manuals, 39 per- Photo credft Ffew/ett.packard Co cent found the manuals hard to understand, A small business owner/manager seeking and 23 percent complained of not having productivity through automation enough written instruction.20 General Business Services, a firm that provides consulting serv- This ratio will have to change if smaller busi- ices to 50,000 small business clients through nesses are to automate their offices. franchised counselors, notes that many of the client firms are purchasin microcomputers, The switch to computers can be a costly and g frustrating experience for a small business. A but only a small percentage of them are using company selling cheerleaders supplies leased their equipment fully. The effective use of the a computer system that would accept phone- equipment depends on the motivation of the users and on improvement and availabilit of in orders, check customer credit limits, figure y shipping charges, adjust inventory, print an helping aids such as teaching diskettes, trained invoice, add the order to accounts receivable, consultants, and user friendly languages, and update inventory when supplies arrived. A small cleaning services firm bought a com- Within 6 months, orders were piled up from puter when a 15-year-old bookkeeping machine high schools ready to begin the football sea- broke down. The owner was convinced by a son, angry customers canceled orders, and at- salesperson that a computer would only cost torneys general in three States were pressur- $2,000 more than anew bookkeeping machine. ing the owner to deliver the goods. What had However, he then had to spend $8,000 for cus- happened? Like many businesses, this com- tomized software. He later learned that the pany had purchased hardware first and then .—— ‘“Dennis Kneale, “Garbage Out: The Wrong Equipment in purchased software from an independent sup- the Wrong Hands Can Turn the Computer Dream Into a Night- plier. The owner hired, then fired a computer mare,” The Wall Street Journal, May 20, 1985, p. 83C. expert who was unfamiliar with the business “David Thompson, “Small Business Buyers in the Retail operation; neglected to solve poor inventor Computer Market,” Desktop Computing, May 1983, pp. 58-61. y ‘“’’small Computers Market Study, ” Natjon’s Busjness, control problems present before the computer U.S. Chamber of Commerce, September 1984. —

Ch. 11—Office Automation in Small Business ● 289 system was too small to track all 6,000 of his was a problem for them. This may, however, customers; two employees trained on the ma- only be a short-term problem, diminishing as chine never got it working; and a second ex- existing employees are trained, as more and pert said fixing the system would take an more new workers are already familiar with additional $8,000 in programming and equip- computers from school courses, and as there ment. The owner now stores the computer in is more and more self-teaching software. At an upstairs corner since he could not find a present, however, it is a significant barrier to charity to accept it. He is aware of his automation for very small firms. mistakes-trying to computerize before it was Bradley Schiller explores the role of small necessary, buying hardware before software, business in training workers and concludes failing to get written guarantees, and failure that this may be the most important function to plan for training cost. He feels he should 23 of small business. The economy benefits by have hired a consultant for a second opinion having a large pool of trained workers avail- before purchasing the system.’* able. The advantage to the beginning worker is the opportunity to gain marketable skills, Time under close supervision, in a variety of activ- Time is a major problem. An owner/manager ities—all of which are generally denied to them with a 50-to 80-hour workweek will find it dif- in larger businesses. Schiller points out that ficult to invest the extensive time required to 67 percent of male workers obtain their first investigate office automation equipment and steady job with firms of fewer than 100 em- then learn how to operate it. The lack of time ployees. to learn the system could quickly cause dis- Small businesses now provide a valuable couragement. The equipment is then neither service to the economy and to other businesses properly nor fully utilized. And he or she often by training new entrants to the labor force in lacks the knowledge needed to evaluate whether specific skills and in general business skills. automated equipment is really needed. The Only the successful adoption of office auto- pressure to be competitive or to purchase be- mation technologies will enable them to con- cause peers are doing so may influence a busi- tinue this function. However, there are costs ness owner to buy equipment without the anal- to the small business employer. According to ysis of needs, benefits, and costs that should Schiller, there is a general exodus of employ- precede such a purchase. ees from small firms to larger firms (300,000 in the past 9 years), where they obtain an aver- Training age of 23 percent in wage increases in the first year. High turnover can be very costly to the Training of personnel is another problem small firm. The productivity of new workers faced by the very small business. The man- is often less than wages paid and the small ager must not only know how to use automated business may not keep the employee long office equipment, but often must also train enough for the increased productivity to pay employees. Alternatively, he or she must hire off. trainers or pay for commercial courses; hire new already trained people; or depend on self- Security teaching software. As the costs of software and training can be twice that of the hardware, As small businesses become more aware that this is a significant problem. Salvate’s respond- information is a primary resource they will nec- ents22 indicated that lack of trained personnel essarily be more concerned about computer

‘Kneale, op. cit., p. 84C. James Salvate, “Microcomputer Survey, ” School of Busi- “Bradley R. Schiller, Human Capital Transfer I’rom Small ness Administration, California State University, I.ong Beach, to Z.arge Business (Washington, DC: Small Business Adminis- CA, 1984. tration, July 1982). 290 ● Automation of America’s Offices security. Not only could their information be Leslie Ball, founder of the Association of accessed by competitors but it could be dis- Computing Machinery’s Special Interest Group torted or destroyed, deliberately or acciden- on Security (SIGSAC), testified to Congress tally, by insiders. The Small Business Com- that small business membership and seminar puter Crime Prevention Act (S. 1920), which attendance in that group was extremely low, became effective October 1, 1984, provides for indicating that the growing awareness of the educational assistance to small businesses in problems of protecting information is not reach- the area of computer security.” Specifically, ing this group. it provides that the Small Business Adminis- tration should, through its extensive network Vendor Responses of counselors to small business, provide the computer security education that small busi- The vendors are aware of the problems faced nesses lack and may need. by the smaller business in adapting to office automation technologies. Available but not Hearings held in March 1984 emphasized fully utilized yet, are systems and components the problems that the small business has with that address these problems, such as: computer security—lack of divisions and specialized employees (one employee could have software with a 30-minute learning time; access to all company information), the high modular systems that can grow with the cost of purchasing specialized computer secu- business; rity systems, lack of knowledge/education ● self-diagnostic systems; about the problems, and little control over the ● use of natural languages for easier re- information systems used because of leased trieval of data; communication lines, timesharing computers, ● customer hotlines for quick, accessible or packaged software. Even basic security help; and measures such as audit trails are not enforced expert systems that simplify managerial 25 in many small firms and separating employee tasks. duties is difficult.

“Small Business Computer Crime Prevention Act (S. 1920), Hearing Before the Committee on Small Business, U.S. Sen- ‘rDavid Cushing, “Vendor Watch: Perspective on Small ate, Mar. 7, 1984. Business Automation, ” Venture, November 1984, pp. 123-158.

FUTURE IMPACTS OF OFFICE AUTOMATION ON SMALL BUSINESSES The impacts of office automation will depend ployees, there may be a very big difference on the overall growth of the economy, the in the effect of office automation on a three growth stage of the firm, and the growth stage employee owner-managed business and a firm of the industry of which it is a part. It will of 50 employees. Some jobs are similar such affect the demand for certain kinds of busi- as that of a secretary, and some functions are ness services, the extension of their markets, similar such as payroll. But compared to larger and the employment levels and skills needed. businesses, small firms have less uniformity by occupation and more multifunction person- Small business is a heterogeneous category nel. Some small business firms, both high and including very small to medium-size firms, low low technology, are dynamic and growth ori- and high technology firms, professional and ented. Some are not. The difference may de- unskilled services. Within firms under 100 em- pend on entrepreneurship, location, and demo- Ch. 11—Office Automation in Small Business ● 291 graphics more than on technology.26 However, help, and small advertising firms that can com- the use of available technologies will eventu- puterize all client presentation formats, allow- ally affect their competitiveness. ing professionals to compose these without clerical help. Conceivably, professional firms The Market for Business Services could also go in the opposite direction, having the clerical help develop the basic computer- Forty-three percent of small businesses are ized will or presentation, allowing the profes- involved in providing services to other busi- sional to spend more time on exceptional work. nesses. This industry is projected by the Bu- reau of Labor Statistics to develop the most Nonprofessional offices may find greater new jobs between 1982 and 1995, growing at productivity in upgrading clerical skills to in- a rate of 3.9 percent per year.27 Although these clude some management functions, such as in- rates are high compared to other industries, formation gathering and organizing, in order they are low compared to past years, when to decrease the need for professionals. The business services employment grew at a rate small farmer, though reluctant to switch to of 7 percent per year. computers, is finding that the use of computers will aid in generating the cash flow statements The use of office automation equipment will and business plans that banks are now de- allow firms to perform services such as graphics, manding. 30 printing, and forms generation in-house. Elec- tronic publishing systems can cut printing and The use of a microcomputer for administra- documentation costs by up to 50 percent.28 tive information processing such as account- These trends could decrease the demand for ing/billing forces the manager to develop more these services from small businesses .29 On the organized work habits that will improve effi- other hand, office automation technologies ciency and lower recordkeeping costs. It could could also facilitate the entrance of small bus- also increase effectiveness by permitting more inesses into national and international markets. communication with customers and potential customers and a faster response time to customers’ needs without a comparable increase Productivity in the time and labor required. Income taxes Most businesses that have automated office and other Federal paperwork that require a functions feel that they have become more great deal of time could be accomplished with productive, often by decreasing time spent on much less stress and time with the aid of a word processing. Small professional offices computerized system. may gain productivity y by adding clerical chores Loss of control of information is a signifi- to the professional job, thereby eliminating cant problem for the growing business; the use clerical jobs. Examples of this include legal of a computer can alleviate this by allowing offices that use a computerized database from the owner/manager to control all records. which the lawyer can develop simple wills and other legal papers without benefit of clerical Effective use of the equipment purchased will depend on the motivation of the users and on improvement and availability of helping -’Peter Drucker, “Business Innovation: Our Entrepreneur- aids such as teaching diskettes and of trained ial Economy, ” Current, May 1984, pp. 14-18. See also, Bruce Phillips, The Marketing of Small Business by Big Business consultants. However, in the effort to mini- (Washington, DC: U.S. Small Business Administration, Au- mize costs, the use of trained consultants is gust 1983). most likely to be deferred or eliminated thus --Valerie Personick, “The ,Job Outlook Through 1995: In- dustry Output and Employment Projected, ” hfonth)~’ I.abor reducing the effectiveness of the automation. Review, vol. 106, No. 11, November 1983, pp. 24-36. ‘“Maureen Nevin Duffy, “Publishing an ‘ Inside Job’ With Today’s Technology, ” MIS, NOV. 21, 1984, p. 42. “’Carol Anderson, “SM17 Word Processing Department, ” “’’Computers: How Ya Gonna Sell ‘Em Down on the SA4E ,Vews, winter 1985. Farm?” Business Wreek, Feb. 18, 1985, p. 144. 292 ● Automation of America’s Offices

The use of office automation technologies large share of small businesses, will provide could aid small businesses in becoming more a large proportion of the new job opportuni- efficient and effective. However, there is some ties over the next 15 years.31 Many of these risk that firms may overburden themselves service industries, such as hotels, restaurants, with debt to make this capital investment, educational and medical services are labor in- overestimating the benefits or underestimat- tensive and, although already automated to ing the time it will take to realize them. some degree, may not be as heavily impacted by automation as business services. Competitiveness and Scale The Salvate microcomputer survey32 indi- A special value of small businesses is that cated however that 11 percent of the small they can serve small, specialized and widely firms surveyed were able to eliminate employ- dispersed markets that, in general, large firms ees because of the use of a microcomputer and would have to aggregate and standardize or 59 percent expected to cut back on employment needs in the future. A U.S. Chamber of ignore in the name of economies of scale. Ad- 33 vanced information technologies may perturb Commerce survey also showed staff reduc- these special niches. They have allowed the tions in 11 percent of the respondents’ firms financial service industries, for example, to and 63 percent reported more efficient use of diversify products, tailor them to special needs, staff. A 1985 survey by the same organiza- and offer them nationwide (e.g., special invest- tion showed that 16.5 percent of respondents ment funds); and conversely, by aggregating plan to reduce hiring in the future because of markets on a greater scale, to offer more stand- automation. Since small business is the largest ardized products (e.g., mail order life insur- employment growth area, this could have sig- ance policies with rates determined only by nificant impact on employment opportunities age, and requiring no medical examination). if it is representative of all small firms. These offerings can intrude on specialized niches Drennan notes that less skilled labor which formerly filled by small businesses. On the used to be concentrated in manufacturing is other hand, real estate firms, formerly small now concentrated in the service sector.34 He and highly localized businesses, have in some predicts slower growth in clerical jobs in of- cases gone nationwide. Information and com- fices, including the business service industry, munication technologies, by nullifying the bar- which is predominantly small businesses. rier of distance and time, can also allow very specialized (and formerly very small) firms to In the near future, higher level skills than operate in larger markets. To do so, however, are currently required may be needed by small will demand a high level of entrepreneurial and businesses who wish to automate. However, management skill that is always difficult to in the long run, less skilled labor maybe needed muster in a new or very small business. as people become familiar with computer equipment in grade/high school and as the equipment becomes more user friendly. Employment and Skills A general increase in overall economic activ- “’’Employment Projections for 1995” (Washington, DC: U.S. Department of Labor, Bureau of Labor Statistics, Bulle- ity could increase the demand for services, al- tin 2197, March 1984), p. 31. lowing small businesses to expand and/or en- Walvate, op. cit. couraging the formation of new businesses. “U.S. Chamber of Commerce, op. cit. “Matthew P. Drennan, Conservation of Human Resources The Bureau of Labor Statistics predicts that (Washington, DC: U.S. Department of I.abor Report, January the miscellaneous service sector, which has a 1983). Ch. n-Office Automation in Small Business ● 293

POLICY OPTIONS The public interest in the health of small new jobs, train first-time employees, serve business is well established; a strong small specialized markets, and utilize marginal re- business sector prevents overconcentration of sources. In the future, this is likely to require economic power and wealth and provides op- them to participate in economy-wide changes portunity for the exercise of initiative, innova- in basic technologies-viable small businesses tiveness, independence, and challenge to ob- that did not adopt the telephone, the type- solete industries and firms. Small businesses writer, electric lighting, and motor vehicles have also played a major economic role in job would be difficult to find. Thus, small busi- creation; training and testing of new workers; nesses sooner or later will have to use com- serving small, specialized, or dispersed mar- puters and probably some other office auto- kets; and productively utilizing resources that mation. would otherwise be wasted. As small firms are Congress may therefore wish to consider ac- faced with technological change that may bring tions to encourage and assist small businesses about structural changes in their economic with efforts to automate. These actions need environment, the related public policy ques- not involve major programs or large expendi- tions are: tures since they would be directed only at re-

● Will office automation make larger firms ducing the problems encountered by very small more efficient and allow them to partici- or beginning firms that have themselves made pate in small and dispersed markets, put- the decision and taken steps toward improving ting small business at a further disadvan- their productivity. Congress might, for exam- tage? Or can small businesses also use ple, urge the Small Business Administration office automation to become more produc- to expand its instructional and counseling serv- tive and increasingly able to compete with ices to small entrepreneurs who are consider- larger firms, in local or in larger markets? ing the use of office automation equipment for To the extent that small businesses adopt the first time. SBA could also provide initial office automation, will their important role training for employees of very small firms at in creation of new jobs diminish? low cost, or provide a telephone advice and information service to supplement the often ● If small businesses do not adopt office automation, will the economic and social inadequate support services available to small benefit that they have provided by train- computer users through computer stores and ing new workers be diminished? vendors. It could provide incentives for banks to provide small low-interest loans for the pur- Only if they remain productive and competi- chase of computers, software, and maintenance tive can small businesses continue to create and support. Chapter 12 Office Automation and Differentially Affected Groups: Working Women and Minorities Contents

Section 1: Women in the Workplace ...... 298 The History of Women and Work in the Office ...... 298 Current and Future Labor Force Participation of Women ...... 300 Section 2: Office Work and Minorities ...... 302

Tables Table No. Page 12-l. Minority Employment in Administrative Support Occupations, 1950-80 ...... 303 12-2. Minority Employment in Selected Occupations as a Percent of Total Employment, 1972 Compared to 1981 ...... 304 —..

Chapter 12 Office Automation and Differentially Affected Groups: Working Women and Minorities

This chapter gives closer attention to two and those that women increasingly aspire to overlapping groups within society who have hold will change in less predictable ways. The an especially strong stake in the long-range possibility of working at home tends to have impacts of office automation—working women a different meaning for men and women be- and workers belonging to racial and ethnic mi- cause their family roles tend to be, at present, norities. A number of issues are now actively very different. before Congress related to employment and Congress now has before it a number of bills economic equity for women and minority groups. dealing with pay equity and comparable worth. This assessment is not primarily directed at These issues are not directly tied to office auto- exploring these complex clusters of issues. The mation, but because automation will affect assessment nevertheless reveals obvious rela- both the number and nature of office jobs and tionships between office automation, as a broad the skills they require, any attempts to com- technological, economic and social trend, and pare jobs within a specific formal job classifi- the special concerns of working women and cation or the demands of jobs across formal minorities, which have been noted through- classifications must take such changes into out the report. This chapter is intended only account. The resolution of these issues will of to provide some general background on these course be determined by many other factors themes in the hope of contributing to future, besides judgments about the comparability of more detailed assessments of the effect of tech- jobs. Legal and regulatory pressures as well nological change on these issue areas. as economic, behavioral, and attitudinal fac- Many of the trends discussed throughout tors and explicit management decisions affect this report will affect women office workers how jobs are designed, how they are filled, and as compared to male office workers either dif- how they are compensated. ferently or to a different degree, because men Section 1 of this chapter provides some back- and women tend to be concentrated in differ- ground on the history of women’s position in ent occupations, jobs, and industries, and at office work, summarizes their present white- different levels of organizational hierarchies. collar occupational status, briefly discusses the Economic, social, and legal conditions of long evidence for pay inequity in white-collar jobs— standing, largely unrelated to technology, have particularly those directly tied to computer- a bearing on how technology effects the life related work—and highlights the relationship of specific groups within the larger society. between these issues and the potential effects With office automation there will be fewer of office automation. The potential effects of jobs in some occupational categories and more office automation on minorities and their rela- in others; those now held predominantly by tively recent entrance into these positions is women are most likely to decrease in number, explored in section 2. 298 ● Automation of America’s Offices

SECTION 1: WOMEN The History of Women and Work in the Office In the early 19th century men performed clerical work in offices as an apprenticeship in business. This was the first step on a career ladder that led to management positions. The tremendous expansion in commerce in the mid- 19th century and the accompanying expansion in paperwork required a great expansion in the office work force. Many businesses grew in scale after the Civil War from small firms with a few clerks and office boys into large corporations with national and international interests. Organizations were restructured into functional divisions and clerical work tended to be broken down into specialized tasks requiring an increase in supervisory positions. The first significant recorded use of women in an office in the United States occurred during the Civil War when, in spite of great opposition, the U.S. Treasurer General, Francis Elias Spinner, hired women clerks to alleviate a severe shortage of available male labor.1 By 1880, offices were being mechanized with typewriters and telephones. Organizations (sometimes unwittingly) began to recruit women for de-skilled clerical jobs while the men retained the management/administrative jobs.z For ex- Women were not accepted wholeheartedly ample, “The Bowery Savings Bank of New into the labor force. There was strong opposi- York installed its first typewriter in 1894– tion from young men who felt they would be without realizing that only females had been losing opportunities because women worked trained to use the new-fangled contraption. So for less pay. Many people felt that women the bank promptly hired its first women. . . .“3 would lose their femininity if allowed to work Although the new technology, typewriters, did in offices and would then be unsuitable wives not cause the expansion in office work that and mothers. Proponents argued that office brought about the recruitment of women, it work did not denigrate women but rather pro- did facilitate the movement of women into of- vided them with training that would make fice work, in that typing was not prelabeled them better household managers, and also as “men’s work’ and therefore unsuitable for argued that the office would benefit from women. 4 women’s “higher moral code.’”

‘Margery Davies, Woman Place 1s at the Typewriter When the U.S. economy was mainly agri- (Philadelphia, PA: Temple University Press, 1982). cultural, women were an equal and important ‘Joan Scott, “The Mechanization of Women’s Work, ” part of the economic team maintaining a fam- Scientific American, vol. 24, No. 3, pp. 167-185. ‘Sidney Feldman, “Women in Banking: An Overview of an ily farm. In addition, single working-age wom- Underutilized Resource, ” The Bankers Magazine, vol. 166, March-April 1983, p. 70. ‘Davies, op. cit. ‘Davies, op. cit., ch. 5 Ch. 12—Office Automation and Differentially Affected Groups: Working Women and Minorities 299

en were often expected to earn some income creasing numbers after 1890. In 1890, 17.4 per- from at-home work such as sewing, knitting, cent of women aged 20 to 64 were in the labor and preparation of food for sale. When women force; by 1920, 22.9 percent and by 1940, 29.4 left the farm to work, it was as domestic work- percent.8 ers and later as factory workers. For women, In 1984, the participation rate for women this meant higher wages and increased eco- aged 20 to 64 was 64.1 percent. Historically nomic independence over work at home. How- nonwhite women participated in full-time work ever, their wages were still quite low and work- in greater numbers than white women, but ing conditions poor. were limited to fewer occupations. Their rate When office work became available to women, in 1890 (for the same age group) was 39.3 per- there was a large pool of women to seek these cent and is currently 65 percent. Work force jobs, which were easier, cleaner, and had more participation for men is about 75 percent. status than factory jobs. Small farm employ- The burgeoning of office work influenced ment declined from three-fourths of the labor women’s increased participation, but other force in 1820 to one-half in 1880. During this factors were also powerful. Birth rates had period many small family farms were barely been declining throughout American history; able to make a living or went out of business, whether this was a cause or an effect of wom- requiring their daughters to seek employment 6 en’s growing participation in the work force elsewhere. The same thing was happening to many small family businesses that had used is a matter for some debate. Birthrates declined in the period 1890-1947, reaching historic lows the unpaid labor of the owners’ daughters. during the 1930s. The birthrate increased rap- In the first half of the 20th century, educa- idly during the 1950s, the baby boom years. tional levels were increasing significantly, with These periods were paralleled and reflected in many more women than men completing high labor force participation rates for women of school. Since literacy was required for office childbearing years, which increased steadily work, women gradually became the preferred between 1890 and 1947, and decreased for 20- sex for clerical employment in expanding bus- to as-year-old women in the 1950s.9 inesses. Commercial business schools became During this century, the acceptance of mar- common in the 1850s to fill the needs for clerks ried women in the labor force slowly increased. trained in office skills. They offered arithmetic, bookkeeping, penmanship, stenography and In 1900, less than 2 percent of married wom- by 1880, typewriting. By 1890, they enrolled en were employed, and employers often fired 80,000 students (for comparison, grades 1 working women who married and did not vol- 7 untarily leave. But from 1920 to 1940 their through 12 enrolled 298,000 at that time). participation rate doubled, from 9.7 to 20 per- Until late in the 19th century, these students cent. 10 had been almost entirely men, but with the Women’s participation rates in past decades restructuring of businesses and office work and did not increase at the same pace for all age the cutting off of the career ladder from clerk groups. Women went to work in great num- to manager, men instead sought training in business management in the universities, bers during World War II. Women whose chil- whose now proliferating business schools did dren were past early childhood tended to stay in the labor force after the war, while the par- not admit women. The opportunity to work in offices brought women into the labor market in steadily in- —————— ‘James Smith and Michael fJ’ard, “tf’omen’s R’ages and “Davies, op. cit., ch. 4, Work in the Twentieth Century” (The Rand Corp. ) October ‘Janice Weiss, “Educating for Clerical Work: The Nine- 1984. teenth Century Private Commercial School, Journal of His- “Ibid. p. 5. tor~r, spring 1981, p. 407, ‘ ‘Ibid. pp. 7-9. 300 ● Automation of America’s Offices .

ticipation of younger women dropped consider- spite of changing social attitudes and public ably in the late 1940s.11 policy objectives. Women continue to cluster in traditionally female occupations, constitut- Discrimination kept the majority of women ing 80 percent of all administrative support working in offices in clerical positions until workers compared to only 32 percent of man- recent times. In 1919, Civil Service examina- 15 agers, administrators, and executives in 1983. tions covered 260 occupations, but for nearly These higher level jobs account for only 7 per- 60 percent of those occupations, the examina- 12 cent of all jobs held by women, even though tions were not open to women. As recently they include many members of the traditional as the 1960s positions were advertised in news- female occupations of registered nurse, health papers as “male” and “female.” technician, elementary school teacher, librar- ian, and social worker. Where women are in Current and Future Labor Force management positions, they are mostly in the Participation of Women lowest rungs of management. ” In 1984, 53 percent of all women aged 16 A report on Microelectronics and Working or older were in the labor force in the United Women for the National Research Council States, totaling nearly 44 percent of the civil- notes that although there has not been wide- ian work force.13 Between 1972 and 1982, wom- spread labor displacement of women by means en accounted for 68 percent of the 14 million of layoffs, there has been lack of growth in increase in employment in white-collar occu- occupations that have been their main source pations. For those women born in 1951 to 1955 of employ ment.17 In the United States, em- (now 30 to 34 years old) the participation rate ployment growth in the clerical occupations is now 66.7, a considerable increase over earlier shows a lag behind increases in the volume cohorts. 14 As older women, who were raised, of business in insurance, banking, and other educated, and socialized when the traditional offices where women have been so highly con- nonemployed housewife was the norm, decline centrated. A Canadian study confirms that in numbers, the overall participation rate can jobs such as secretaries, filing and other of- be expected to rise. Moreover, the birth rate fice clerks, bank tellers, keypunch operators, is likely to remain low, and there has been a telephone operators, mail handlers, and the su- dramatic increase recently in continued labor pervisory personnel for these positions are force participation of women during childbear- among the slower growing occupations.18 OTA’s ing years, including continued participation analysis (chapter 2) points to a long-range de- by mothers of young children. cline in jobs held predominantly by women. Already employment declines have occurred The available work force in 2000 will con- in the heavily automated insurance industry sist predominantly (75 percent) of people al- in keypunch operators, bookkeepers, file clerks, ready in the work force in 1985. Today, 80 per- 16 mail handlers, and typists. cent of the clerical work force is female, and 30 percent of working women are clerical work- ——————— ers. That gender segregation in clerical jobs “Facts on Women Workers (Washington, DC: U.S. Depart- ment of Labor, Office of the Secretary, Women’s Bureau, 1984). has, over the long range, been increasing in “Time of Change: 1983 Handbook on Women Workers (Washington, DC: U.S. Department of Labor, Office of the Sec- “Women’s household burdens decreased during the early retary, Women’s Bureau, 1983), Bulletin 298, pp. 52-53. 20th century because of fewer children and because of the in- “Diane Werneke, “Microelectronics and Working Women: troduction of labor-saving devices for the home. There is still A Literature Summary, ” Cornrnittee on Women’s Employment debate, however, as to whether or not this provided housewives and Related Social Issues (Washington, DC: National Acad- with extra free time; there were also fewer women per house- emy of Sciences, 1984), prepared for the National Research hold, the family servant disappeared, and new tasks appeared, Council. “Davies, op. cit., app. table 5. IHWerneke, op. cit. ‘3EmpZoyment and Earnings (Washington, DC: U.S. De- “Eileen Appelbaum, “The Impact of Technology on Skill partment of Labor, Bureau of Labor Statistics, January 1985), Requirements and Occupational Structure in the Insurance In- p. 156. dustry, 1960-1990” (Philadelphia, PA: Temple University, Apr. “Smith, op. cit., p. 8. 1, 1984). Ch. 12—Office Automation and Differentially Affected Groups: Working Women and Minorities ● 301

Future employment opportunities for women, the differences. The reasons usually offered although dependent on growth of total demand include differences in education and experi- in the economy, may be more dependent on ence, occupational and industry choices, job the opportunity for increasing their skills, work mobility and number of hours worked. How- experience and upward job mobility, which ever, men who go into “female” lines of work would allow them to take advantage of chang- earn more than women in those fields. Female ing job requirements. However, these oppor- full-time, year-round clerical workers had a me- tunities may not materialize. In the insurance dian income of $10,997 in 1980 while male cler- industry, as overall female employment has ical workers had a median income of $18,247. increased in all job categories, the professional A similar differential is found in all occupa- jobs into which they have moved have fre- tions.23 quently been changed to lower pay levels to 20 Pursuing a career in the computer industry reflect lower skill levels. does not automatically alter traditional rela- New jobs are emerging in the computer and tionships. There were compelling reasons to technical specialist occupations, especially for expect to find relatively little male-female dis- engineers, computer analysts, and paraprofes- parity in computer-related occupations, espe- sional computer technicians, positions in which cially programming. The occupations are new, relatively few women are employed. Accord- women have been involved in the field from ing to the Bureau of Labor Statistics, com- the beginning, there has been a steady sellers’ puter specialist jobs increased from 275,000 market, and the growth of the industry coin- in 1972 to 585,000 in 1980. Women increased cided with implementation of affirmative ac- their share of these jobs from 17 percent in tion and equal employment regulations. How- 1972 to 26 percent in 1980. However, women ever, women are paid less than men in every were more likely to be programmers than sys- computer specialization, in every industry, and 24 tems analysts (a higher level, higher paid po- at every organizational levelo 21 sition). The possibility of a general decline in com- Whether it cuts off career ladders, eliminates pensation associated with de-skilling of work unskilled clerical work, or requires more or and enhanced interchangeability of workers different training and skills, office automation (generally in conjunction with anticipated job will change the nature and skill requirements polarization) is also of concern to some re- of traditional office occupations and jobs.22 searchers. While these conditions have been Whether or not these changes will be reflected noted in specific organizations, particularly in changes in job title, job classification, and those in office-oriented industries, the counter compensation levels remains to be seen. His- trend toward job enlargement in both office- torically, “women’s” jobs have paid less than oriented industries and general offices may “men’s” jobs. The figures comparing men’s provide some offset. Another uncertainty is and women’s average salaries are well known, the effect of large-scale shifts in the structure as are the many discussions of the reasons for of the economy, together with changes in la- ——— — bor supply, on the wage structure (holding job “’Barbara Baran, “Insurance Industry and Trade Strate- content constant). gies, ” draft report prepared for the Office of Technology Assess- ment, September 1984, p. 6. Some observers express concern about un- “Carol Boyd Leon, “Occupational Winners and Losers, dercompensation for skills that may not be 1972 -80,” Monthly Labor Review, June 1982, p. 22. “Arbeidsnotat fra forskningsprammet “Teknologiens be- tydning for kvinners arbeidsliv ” (Working Paper From the Re- “’’American Women: Three Decades of Change” (Hearings search Program “Technology and Women’s Work”) Journal before the U.S. Congress, Joint Economic Committee, Wash- for Social Research, vol. 23, 1982, pp. 519-534; Roslyn Feld- ington, DC, Nov. 9, 1983), Testimony of Lewis Kincannon, Bu- berg and Evelyn Glenn, “Technology and Work Degradation: reau of the Census, p. 26. Effects of Office Automation on Women Clerical Workers, ” “Philip Kraft, “Computers and the Automation of Work, ” Machina Ex Dea, Joan Rothschild (cd. ) (New York: Pergamon State University of New York at Binghamton and Center for Press, 1983), p. 72; and Baran, op. cit., p. 136. Survey Research, University of Massachusetts, 1984. 302 Automation of America’s Offices

captured in formal job descriptions but are by supply and demand. For example, an abun- nevertheless essential. Automation may de-skill dance of teenage candidates for fast food- some jobs, but it may also involve a change service work in the recent past may be one from manually intensive work to mentally in- reason why the pay is low. That situation is tensive work that requires closer attention and changing now with the decrease in the num- increased responsibility for accuracy. Increased ber of young workers entering the labor force. knowledge about the operations of the whole But in practice, other factors confound pay organization may be required to ensure ac- structures so that there may not be a direct curacy of data input. These “invisible skills” relationship between the pay and the supply become apparent only when they are not per- of workers. If fast food restaurants in the formed well.” future were faced with raising pay rates to attract needed workers, they could further au- As office automation changes tasks and jobs, tomate their tasks and insist on more self- blurring the distinctions between “men’s” and service by customers. It is evident from the “women’s” work and between clerical and experience in other consumer service indus- professional work, the opportunity is available tries, for example banking, that we are becom- to objectively evaluate jobs, their skill require- ing more and more a self-service society. This ments, and compensation. Major changes in could also be the case in offices as professionals the occupational mix and in job content are perform their own typing and graphics tasks likely to bring about pressure for new pay and clients input information directly into structures. In economic theory, individual pay computers, receive output directly into their is a function of the contribution of the indi- own computers, and print the information vidual to the organization’s output; hence, pay themselves. generally increases with productivity. In a competitive market wages are also influenced The effect of information and communication technologies on the nature of work, on ——. ..—— - .— job classifications, and on compensation struc- “Joan Greenbaum, Cydney Pullman, and Sharon Szyman- tures is thus far broader than the issue of pay ski, The Labor Institute, “The Impact of Office Automation equity and comparable worth for women, but on the Municipal Workforce of New York City: A Case Study, contract report for the Office of Technology Assessment, April it will have a direct and immediate relation- 1985. ship on those discussions.

SECTION 2: OFFICE WORK AND MINORITIES Black workers account for 10.2 percent26 of (See table 12-1.) They began moving into of- the clerical work force, which is comparable fice work in significant numbers only in the to the black share of the labor force and the 1950s. Black w-omen increased their share of population. Hispanic Americans account for clerical jobs by 163 percent between 1950 and 5 percent of this occupational category.” For 1960. Women of Hispanic origin increased minority women, especially, the movement their share by 333 percent,29 now making up into clerical jobs has in fact represented an about 4 percent of the clerical work force. important channel of upward social mobility.28 Center for the Study of Social Policy, “A Dream Deferred: The l+~conomic Status of Black Americans, July 1983; and Thierry -’Emplo-vment and Earnings (Washington, DC: U.S. De- Noyelle, “The New Technology and the New Economy: Impli- partment of Labor, 13ureau of I.abor Statistics, January 1985), cations for Equal Opportunity, ” work in progress, Columbia p. 177. University, New York, February 1985. “The Hispanic category includes black and white Hispan- ‘<’U.S. Census of Population for 1950: Occupational Charac- ics, so the true number of black clerical workers is difficult teristics, Special Report P-E No. 1 B, p. IB-31; and U.S. Census to ascertain. of Population, 1960: Occupational Characteristics (Washing- -“See: Diane Nilsen Westcott, “Blacks in the 1970s: Did ton, DC: U.S. Department of Commerce, Bureau of the Census, They Scale the Job Ladder?’ Monthly Labor Rew”ew, June 1982; p. 23). Ch. 12—Office Automation and Differentially Affected Groups: Working Women and Minorities 303

Table 12-1 .–Minority Employment in Administrative Support Occupations, 1950=80 —. — - - White——— Black Other Male - Female Male” Female Male – Female Year Total – (0/0) (0/0) (0/0) (“/0) -- (%) (%) 1950 6,864,600 ‘- 2,476,710 4:187,820 109,740 75,060 5,580 9,690 (36.1) (61 .0) (2.1) (1.1) (0.08) (0.14) 1960 9,617,874 2,821,463 6,048,678 184,823 197,263 22,50~ 41,998 (29,3) (63.3) (1 .9) (2.1) (0.23) (0.44) Hispanic Male Female (%”) (0/0) 1970 13,748,260 3,258,901 9,346,947 330,492 691,097 144,309- 297,116 (23.7) (68,0) (2.4) (5.0) (1.1) (2,2) 1980 16,851,398 3,235,744 11,325,716 435,365 1,200,516 234,132 595,461 (19,2) (67.2) (2.6) (7.1) (1 ,4) (3.5) SOURCE Data are derived from the U S Department of Commerce, Bureau of the Census, U S Census for 1950-7980 Washington DC

Between 1960 and 1976 the proportion of ment, and professional jobs as these options minority women workers employed as domes- opened up for them. tics dropped from 35 to 9 percent, while the Black and Hispanic males also increased percentage employed in clerical work increased their share of clerical jobs considerably be- from 9 to 26 percent, and the percentage in tween 1950 and 1960. Black males held a larger professional and technical jobs rose from 7 to share of clerical positions in the 1950 census 14 percent. Half of all minority women were than did black females. The balance changed in the work force in 1976, compared to 47 per- however by the time of the 1960 census, when cent of white women. The movement of black black women slightly outnumbered black men and Hispanic women into office occupations in clerical jobs; they have increased this gap has thus occurred almost entirely within the steadily since 1960. last 30 years and has aided many of them to move into the middle class. During the 1970s, minority workers made significant gains in moving into white-collar By 1980, over 29 percent of employed black occupations and in advancing within these oc- women held clerical jobs, and 14 percent held cupations. Their share of professional jobs such professional jobs. The wages of all minority as credit and collection managers and office women relative to white women rose from 70 30 managers increased tremendously as did their percent in 1960 to 94 percent in 1976. But share of clerical jobs such as bill and account between 1976 and 1980 their income slipped collectors, secretaries, and statistical clerks. to 86 percent of that of white women. In 1976, The jobs that showed the largest growth for black female clerical workers’ wages were 107 minorities between 1972 and 1981 are shown percent of that of white female clerical work- 31 in table 12-2. Many of these positions are, how- ers, but it slipped to 97 percent in 1980. One ever, still at the lower end of the scale and reason for the higher level in 1976 is thought thus most likely to be affected by job displace- to be that black women had been in these jobs ment from office automation; the black work- longer and thus had higher pay levels because of seniority. After 1976, higher paid, educated ers also tend to have least seniority since these jobs became open to them only in recent years. black women may have been moving out of clerical work and into supervisory, manage- Because of a growing economy and the ac- —— . tive interest in social change in the United ‘‘ \l inorit~ }!’omen Jlrorkers: A Statistical otrer~riew, States, employment opportunities for minor- ,Jlanuaf on l)a~ I+;quit>: Raising Jlrage.s for 11’omen ‘.? 1$’ork, ities have seen noteworthy improvements in .JoJT .lnn (;run(’ (cd.], (’omtnittee on l)a~r [jquit~’, No\rt~mher 19X1. pp. :)1-:14. the last two decades. However, black workers \\’(’$[c(Jt t . op. cit., p. 37. still have significantly higher unemployment 304 ● Automation of America’s Offices —

Table 12.2.—Minority Employment in Selected Another problem for the minority workers Occupations as a Percent of Total Employment, is the strong trend in the last decade for offices 1972 Compared to 1981 to move from the central city to the suburbs, Minority employment and for business and industries to grow in the South and Southwest and shrink in the North- Occupation 1972 1981 east. Because 55 percent of black Americans Computer specialists ...... 5.5 9.4 Bank officials and managers ... 2.6 5.5 live in central cities, as compared to 24 per- Credit and collection managers . 1.4 4.4 cent of whites, and only about 22 percent of Office managers, ...... 1.0 4,0 Bank tellers ...... 4,9 7,6 blacks live in the suburbs, the movement of Billing clerks ...... 6.7 10.5 offices from central cities to suburbs decreases Bookkeepers . . . . . 3,6 6.3 their opportunity for office employment. Gov- Collectors, bill and account. . 5.0 10.8 ernment employment in central cities, which File clerks ...... 18.0 22.9 Secretaries ...... 5.2 7.2 has been a significant source of employment Statistical clerks ...... 8.4 15.1 for minority workers, is likely to stabilize and Typists ...... 12,0 17.8 may well decline. The shift of office work to SOURCE U S Department of Labor, Bureau of Labor Statlstlcs, Current Popu/a- fton Survey A Databook VOI 1 Washington, DC 1982 pp 651667 the Southwest tends to further decrease the access of black women to office jobs, although rates than whites and also higher rates of in- it increases opportunities for Hispanics. voluntary part-time work. Both of these trends could be intensified by the use of office auto- The greater instability of worklife for mi- mation. The changing nature of skills required norities and their concentration in the lower for beginning and mid-level jobs and the chang- level clerical jobs indicates that their efforts ing nature of job training (see chapter 3) will to better their status may be more difficult also have an effect on the future employment in the future than it has been in the past dec- levels of minorities in offices, unless their ac- ade. The availability to them of training and cess to training is increased. Minority work- education and the continued growth of the U.S. ers will have to find ways to obtain the more economy is of the highest importance if mi- formalized and more off-the-job training re- norities are to maintain and increase the quired to fill positions in the office. progress they have made.

Appendix A The Technology of Office Automation

Business is now faced with the problem of con- Data Gathering trolling 400 billion documents, a number that is 1 Information flows into an office from the inter- increasing at the rate of 72 billion per year. Fortu- nal accounting systems of the organization, cus- nately, technology is providing the means of elec- tomers and prospective customers, government tronically storing billions of characters on a single agencies, suppliers, trade groups, and other sources. device and moving data at the rate of millions of Intraorganizational data flows constitute a signif- characters per second. This appendix describes the icant portion of the total, Data, once received, must technologies that are in use in offices, those that be put into a form suitable for processing, Some may be applied in offices during the remainder of has to be transcribed from one medium to another. this century, and how they may affect office oper- For example, an order that is received by telephone ations. has to be recorded on an order form. On the other Information is ephemeral. It must be available hand, automatic readers in supermarkets capture when and where it is needed; too late, it maybe use- all the data needed for inventory control as a by- less. The goal in applying information technology product of the checkout procedure. is to deliver information to the end user on time and Traditionally, the process of transcribing data at the lowest possible cost. Information technol- from one medium to another has constituted a sig- ogy eliminates distance as a significant factor in nificant portion of the work. I.arge numbers of peo- determining the degree of operational control that ple worked at typewriters transcribing manuscript managers can exert over operations. It reduces the and at keypunch machines transcribing informa- time required to analyze large volumes of data and tion from documents to punched cards. Modern makes the resulting information available to those technology is reducing the need for transcription. who need it for decisionmaking. Professionals now create text that clericals edit and format rather than transcribe. Scanners are in- Overview of Appendix cluded in materials-handling systems to capture data in a form processable by machine. This appendix describes the technologies for information processing and telecommunication in Data Organization and Storage the office. First, a taxonomy of the functions of the office is presented, followed by a description of Data is useful only if it is organized in a way that relationships between the functions and the tech- makes it identifiable and accessible. Offices have nologies that are now available or could be avail- used multipart forms and files housed in cabinets able in the future. Following that is a more detailed for organizing and storing data. Modern technol- description of the technologies and the options for ogies for data storage and organization range from employing them. large-scale computers that are capable of handling hundreds of millions of records, as in the case of A Systemic View of the Office the Social Security Administration, to small data bases containing a few dozen records that are stored The following functions comprise the set of ma- on personal computers. Copying machines reduce jor office activities: the need for multipart forms because additional copies can be made on demand. Telecommunication lets ● data gathering, responsibility for organizing and storing data be ● data organization and storage, assigned to those responsible for gathering it. Or ● data access and retrieval, all of an organization’s data can be gathered in one ● data processing, and central location. In either case, all who require ac- ● communication of results. cess can have it immediately regardless of their physical location, A shared database reduces the problems of keep- C, 1“: W’hlte, (’ “ LS’1’A and A’I’&’l’, ‘‘ 7’elec’omn]unic8tio ns,” April ing multiple copies of data synchronized. But not 1 VHF), p. 44. all data in an office is meant to be shared. Much

307 308 ● Automation of America’s Offices — consists of working documents useful only to spe- In addition to automating traditional data re- cific individuals. duction and reporting tasks, modern technology puts new capabilities in the hands of users. Word Data Access and Retrieval processors make it easy to alter text and combine or refine documents. Computer-based models can The third function provided by an office is data be used to explore the consequences of decision access and retrieval. Implicit in this function is mak- alternatives. These range in complexity from coming all who may need data aware of its existence paratively simple spread sheets to econometric and and denying access to it by others. In a paper based process simulation models that involve the interoffice, one of the means of assuring awareness of action of hundreds of variables. Decision-support data is to provide potential users with “informa- systems can provide insight into the consistency tion” copies of documents. Others who need data or interaction of judgments made by the deci- must then seek out one of the existing copies and sionmaker. its accessibility to those not authorized to have it Experience over the last 30 years shows that is implicitly limited. On the other hand, errors in users constantly find new and previously un- data are often discovered after documents have foreseen ways to employ this technology effec- been distributed, and corrective information has tively. As the number of users has increased, the to be sent to all who have copies so that all are oper- technology has evolved to require decreasing ating from a common base of information. This goal degrees of technical sophistication from the user. is difficult to attain. Innovative applications will thus continue to Paper-based files may be less than satisfactory emerge. because of the time that it takes to move physical documents from point to point. Advanced tech- Communication of the Results nologies do not constrain the accessibility of data to those in a specific geographic area and thus re- Another function of an office is the delivery of duce some of the limits on office operations. information. Traditionally, it has been delivered It is most efficient to access only those data of either orally or in hard copy. Preparation of hard interest. In the past, the user had to obtain one copy requires considerable effort, and transport- or more documents and sort through them for spe- ing it requires time. Orally transmitted informa- cific data of interest. With the aid of modern tech- tion is ephemeral and difficult to capture; transcrip- nology, the user can identify and retrieve specific tion is required if an enduring record is to be data elements that are needed. created. Modern technology lets the user specify the for- Data Processing mat in which information is delivered. It can be presented for viewing on a display screen but can The tools for data analysis range from hand- be easily replicated. Telecommunication has largely drawn graphs depicting relationships between and neutralized distance as a factor. Many users can among data elements through programs run on work from a common database eliminating the the most powerful computers. Nonnumeric data problem of inconsistent data. is assembled in tabular formats for study and analysis. The speed at which humans can process data Users and Providers is limited regardless of whether they are performing numerical calculations, preparing charts and The trend in applications of advanced technol- tables, or creating text. It is unreasonable to ex- ogy in the office is toward direct involvement of pect an individual to even attempt some computa- the user with minimal technical training. The tech- tions. But modern information technology provides nologies to support these systems comprise two powerful tools, ranging from systems that will re- relatively distinct classes. The first consists of cen- trieve and order data to user specifications, to tralized data processing equipment that is used those that routinely prepare reports representing to prepare printed reports as well as provide for thousands of individual data items. The trend is direct user interaction through terminal devices. to reduce the need for professional data process- The second includes a variety of stand alone de- ing personnel by providing users with easy to use vices, microcomputers and word processors that tools having great analytical power. are under the direct control of the end users. App. A—The Technology of Office Automation ● 309

The user seeks a functional capability rather than to selling to office managers who buy equipment a specific technology. From this perspective, the as though it were standardized, like paper clips terminal tied to a central computing facility can and forms. be the functional equivalent of a personal com- Computer manufacturers comprise the second puter. However, from the systems point of view class of equipment suppliers. They are most com- of managing the information resources of an orga- fortable dealing with professional technicians and nization, the alternative technologies can have have had little contact with other office workers. quite different implications. For example, in an of- While programmers and analysts were interposed fice served by a centralized facility, both the report- between the computers and the end users, sellers ing needs of the organization and the needs of users of computer systems did not find it necessary to for selective access can be supported from a com- structure their products to be understandable by mon, shared database. On the other hand, coordi- nontechnical people. Technicians were assumed to nating the activities of users of personal computers know the strengths and limitations of the equip- who each define and structure data resources differ- ment and to take the steps necessary to ensure ently, may present a considerable problem for man- its operability and the integrity of the work it sup- agement. ported. Data processors, for example, know the Complicating this problem is the fact that the importance of creating backup copies of data; of- technology is not neatly divided into centralized fice managers often do not. processors and individual workstations. There are The third group of providers of technology to hybrids of these technologies. Microcomputers can the office are telecommunication specialists, Their be linked to central facilities to retrieve data that traditional role was to place telephones where can then be processed at the user’s location, Al- needed and keep them in repair. Organizations with ternatively, networks of microcomputers permit significant communication requirements worked the sharing and interchange of information. Thus, with the providers of telephone service to estab- one of the effects of the emerging technologies is lish private networks when such steps were eco- that the functional characteristics of an office sys- nomically justified. Data communication facilities tem can be defined almost independently of the were generally separate from voice services. Addi- technologies used to implement those functions. tional circuits were obtained for facsimile and video Furthermore, while the end product of a system transmission as required. may be achieved through alternative means, the The divestiture by AT&T of its operating com- internal structure of a system can have significant panies and the emergence of a variety of competi- implications for the operations of an organization, tors has complicated the job of the telecommuni- its employees, and its management, cations manager. There has also been a marked Technology consists of tools and the knowledge increase in data traffic and in requirements that of how to use them. Computers and telecommuni- voice, data, and other traffic share telecommunication networks are virtually valueless to those cation facilities. This has required that telecom- who do not have a clear understanding of how they munication mangers become heavily involved in fit into the office environment and the benefits that the design, development, and operation of infor- can be derived from them. Systems put in place mation processing systems. They must now work without such understanding have often failed to closely with technologies that are often unfamiliar, meet the needs of users. These failures represent In the past, the office manager, telecommunica- a waste of significant resources and, in many cases, tion manager, and data processing manager have result in the creation of barriers to future intro- been able to operate more or less independently. ductions of technology. Each had a constituency of users able to maintain a marked level of distinction between the three Equipment Providers classes of support services. Now there is a need for greater interaction, a need that will increase The providers of technologies for the office come with time. from three distinct heritages. First, there are the Equipment and service providers from each of suppliers of the kinds of equipment that have been the three sectors have moved into areas served by in offices for decades—typewriters, calculators, the others. Computer manufacturers offer word copying machines, etc. They have traditionally as- processing systems; some word processors now sumed a comparatively rigid division of tasks have the same capabilities as small to midrange among office workers. Secretaries type; profes- computer systems. All offer telecommunications sionals use paper and pencil. They are accustomed equipment, and telecommunication providers are

52-644 0 - 85 - I 1 310 ● Automation of America’s Offices beginning to offer processing services. From the Alternatively, a communication network may in- point of view of the user, this competition is prob- clude only small computers under the direct con- ably beneficial, but each kind of provider may have trol of end users, using the network facilities to difficulty in understanding the nuances of new mar- access data wherever it is located. Processing func- kets. For exampIe, the firm that has been success- tions are controlled by the end users with, possi- ful in providing word processing equipment may bly, some coordination activities being the respon- not grasp all of the operational ramifications of sibility of a central data processing function. expanding its line to include capabilities normally Telecommunication facilities can be designed so associated with data processing. that they perform processing functions as well as provide a conduit for moving information. For ex- The Merger of Telecommunication ample, the network can convert codes used by one and Information Processing type of equipment to a format usable by another so that the two can exchange data. Network In 1956, AT&T, in a consent decree, agreed that switches can route data between locations on the it would not build data processing machines for basis of address information that constitutes part sale on the open market. In the mid-1970s, it of the message, They can also combine informa- offered for sale a terminal that had some process- tion from a number of incoming messages into ing capabilities; and the question of whether that another that is sent to a specified destination, violated the 1956 consent decree led to an inquiry Advanced telecommunication equipment avail- by the Federal Communications Commission, able for offices can select the lowest cost alternat- called Computer Enquiry II. One of the purposes ive for routing each call, with some calls routed of this proceeding was to establish a line of demar- over one of the public long distance services and cation between telecommunication and data proc- others over the organization’s private network. essing equipment and services. The final report Some equipment can combine voice with data traf- sidestepped the issue; it failed to differentiate be- fic on a common internal network. Computers that tween telecommunication and data processing, but comprise an office local area network function as defined a set of basic telephone services that could the switches for the network while at the same time be offered by AT&T and enhanced services that providing its data processing capabilities. could be offered through an arm’s length subsidiary. This put to rest the assertion that telecommunication and data processing services and equip- Broad Trends in Telecommunication ment could be differentiated. The interaction of and Information Processing the two technologies has changed the fundamen- Technologies tal character of both. One result is the ability to deliver information The foundation of new office technologies is the processing services directly to the end user through integrated circuit. The equivalent of hundreds of a variety of system configurations, Terminals can thousands of transistors can be built on a silicon be connected to a central processing facility wafer with an area of a fraction of an inch. Al- through either the conventional switched telephone though many argue that the limits of silicon-based network (dial-up service) or through a dedicated chip technology are being approached, the compo- network “owned”2 by the user organization. In this nent density of chips can continue to increase at configuration, all processing takes place at the cen- least in the short run. Alternative technologies are tral site. A variation of this substitutes computers likely to become a factor in the market in the 1990s. for the terminals so that some of the processing Gallium arsenide, for example, offers potential is done at the user location and some at the cen- advantages in speed relative to silicon oxide tech- tral location. nology, and may provide a foundation for new materials that are more optimal than silicon for ‘An “owned” network, more often than not, will make use of circuits microelectronic circuits. Chips that have circuit that are leased from a common carrier and dedicated for the use of the components distributed in three dimensions rather lessee. In some cases, organizations wilf build and operate their own than two are likely to be on the market in the rela- telecommunication facilities that may include such diverse components as ground stations for use with satellite transponders, microwave tow- tively near term, with improved performance to ers, and fiber-optic cable. The balance between leased and owned facil- price ratios relative to those now available. ities is struck by each organization to be consistent with the cost sched- Increasing the number of components that can ules for the alternatives and other, noneconomic consideration (e.g., the organization makes the judgment that it does not want the problem be built into a single integrated circuit, by reduc- of operating a satellite Earth station). ing the physical size of a circuit increases its speed App. A— The Technology of Office Automation 311 — — . ——

per wire, microwave and coaxial cable technologies in the form of reduced physical size, elimination of interference between messages carried over con- ductors in a common cable, and increased security (because fiber optic circuits are more difficult to tap). The use of optical devices in switching and storage devices is still a subject of basic research and is not likely to be a significant factor in the market in the near term. Such devices, if perfected, could offer advantages over microelectronics in that they could be less susceptible to electrical and magnetic fields generated by office machinery, In addition, since they would not emit electromagnetic radiation that can be detected and decoded, they would provide more data security. Because the prices of computer components are expected to continue to decrease, it is possible that functions now performed by software maybe built into the hardware. For example, one of the most popular spread-sheet programs is now built into a portable lap-top computer and operates as if it Photo credif Be// Labs had been loaded as a diskette. On larger systems, One of the continuing trends over the last several complex programs such as language processors, decades has been the reduction in the size of the database systems and communication processors microprocessor. This shows a very large-scale may be included in machine hardware. integrated memory management chip. A logical extension of this concept is the development of limited function machines dedicated to and hence the computational power of devices. As a specific task or a narrowly defined set of related production volumes grow, the prices of chips fall. tasks. Familiar examples of dedicated devices in- Generally, this is translated into increased perform- clude stand-alone word processors and hand-held ance to cost ratios for equipment. Fewer chips are calculators. required for end-user devices, again lowering the But running counter to the trend of building in- cost to build them and reducing the cost of main- creased capabilities into the hardware is the re- tenance. cent emergence of reduced instruction set com- Thus, the cost of office equipment will continue puters (RISC).’ These computers have 50 or so to decrease, but they will not go to zero; the bot- instructions in their repertoire rather than the well toming of prices is likely in the next few years. over 100 found in conventional machines. By proc- Beyond that, the benefits of technological improve- essing a few types of instructions very quickly, ments are likely to be in the form of improved per- RISCs can in theory outperform those with more formance at relatively stable prices.’ complex instruction sets. A greater burden is Optics4 may provide an alternative to electronics placed on software designers to optimize their de- as the basis for the operations of computing and signs in light of the attributes of the machines. communication devices. Already, fiber optic con- RISCs have gained some degree of commercial ductors are being deployed widely in telecommu- acceptance, because tests have shown that in some nication networks. They offer advantages over cop- applications they can outperform conventional computers. However, all of the reasons for this im- ‘This statement has to be taken with a grain of salt. In the early proved performance are not fully understood. 1970s a calculator with four functions, memory, and square root sold Changes in conventional computers that would use for something over $100. In the last year, a major manufacturer of elec- some of the coding techniques and architectural tronic equipment gave away such a calculator as part of a promotional campaign. This adds some credibility to the argument that equipment features found in RISCs may yield significant im- could become a ‘‘throw-away provided at no cost to the user who buY, s provements in their performance. some package of services. ‘Computers and communication devices can be built of components that manipulate light waves just as microelectronic devices and conventional communication network components manipulate electrical ““R ISCs-Reduced Instruction-Set Computers–5fake I,eap, ” SJrs- currents. tems and Software, December 1984, pp. 81 ff. 312 ● Automation of America’s Offices

The users of office automation are less interested there may have to be a significant rethinking of in the nuances of the technologies used to imple- the way an office operates if the potential benefits ment systems than they are in the functional char- of the technologies are to be realized. acteristics of those systems. Just as most automobiles are bought to provide transportation, not as Trends in Specific Technologies a hobby for the amateur mechanic, most users of office systems want specific tasks performed and From a functional perspective, information proc- care little about the inner workings of the com- essing and telecommunication technologies can be puter. Designs of newer office systems are gener- grouped into five broad categories: 1) processors, ally moving in the direction of insulating the user 2) input technologies, 3) storage, 4) communica- from the specifics of the underlying technologies. tion, and 5) software. Trends in each of these areas Many of the application programs now com- will be discussed in the sections that follow. monly used in offices are accompanied by thick jargon-laden manuals purporting to inform the Processors user how to obtain the promised benefits from a package. Some of the newer systems, on the other The Microcomputer.–The microcomputer that hand, are self explanatory and are accompanied is becoming ubiquitous in many offices is the small- by minimal amounts of paper documents. In the est of computers, followed by, in increasing order long run, information processing systems will, like of size, minicomputers, mainframes and supercom- the automobile, evolve to the point where the user puters. These constitute a continuum of capabil- can operate them with only minimal understand- ities, with considerable overlaps at the boundaries ing of their underlying technical structure. between classes. A large microcomputer may have As the capabilities of applications and hence roughly the same capacity as a small minicomputer. their complexity increase, total development costs Conceptually, given enough time, any computer for office systems have tended to rise. However, can perform all of the computational tasks that emphasis is moving from systems tailored to meet can be envisioned. They all operate on the same needs of specific organizations to those having principles. Realistically, however, large computers sufficient generality to meet diverse needs. Be- are necessary to perform tasks that require the cause these generalized capabilities can be sold in manipulation of large databases and extensive volume and development costs can be spread over computations. A large computer can also simul- large user communities, their price should fall. taneously support many small tasks each of which These tendencies toward lower priced microelect- could be handled alone by a smaller computer. ronic circuitry and systems designed to minimize Thus, one alternative for offices is to provide all requirement for technical expertise, together with processing support from one or more large com- the merger of telecommunication and information puters with many terminals. processing imply: Generally, microcomputers are designed to be ● a broad and increasing choice among techno- used by a single individual and to perform one task logical options for accomplishing information- at a time. In 1985, a microcomputer for use in the handling objectives; office can be purchased without a printer for $1,500 a strong movement toward distributed data to $3,500. A printer, depending on the quality of access and data handling, usually superim- the output desired, can be bought for an additional

posed on rather than superseding centralized $300 to $2,0000 automatic data processing; Microcomputers capable of supporting multiple more and more capture of data at the point tasks and several users simultaneously are com- of origin, with decreasing need for repeat keying on the market. Programs that allow two or boarding and centralized data entry; and more programs to be active simultaneously are ● unlimited capability for communication, be- available. Networking microcomputers has become tween devices, between organizations, and be- possible using programs and hardware components tween locations. purchased off the shelf. A variety of generalized Managers will have the freedom to define or- spread-sheet, word processing, accounting and util- ganizational policies and objectives with more ity packages are available from both computer alternatives for implementing them. This creates manufacturers and third-party suppliers. Thus, of- a greater need for analysis to make good selections. fice workers will have under their direct control Both for the designer and user of office systems computer power that until very recently was found App. A—The Technology of Office Automation ● 313 only in corporate data centers. At present they Minicomputers. -Minicomputers trace their line- need to develop the expertise to modify existing age to the requirements of scientists for low cost procedures and design new ones to take full advan- computers for laboratories. They were the earliest tage of the available capabilities. But this could means of providing end-user computing. However, lead to a significant redistribution of function and they were delivered with little if any software, and power between data processing groups and end it was the responsibility of the users to do what- users. ever was required to get useful work out of them. Stand-Alone Word Processors. -Stand-alone word Minicomputers have, however, evolved to achieve processors are microcomputers whose hardware many of the characteristics of mainframes. They and software configuration has been optimized for support large amounts of data storage and permit word processing. As other software, such as data multiple users simultaneous access. Often, mini- management and spreadsheet programs, are made computer installations are run by a data processing available for them, the dedicated word processor manager supported by a small group of program- becomes indistinguishable from a general purpose mers, The principle advantage of minicomputers microcomputer. But as yet, with a few exceptions, is that they offer the midsize organization consid- the manufacturers of word processors have not sig- erable power at a cost significantly below that of nificantly broadened the application packages for a mainframe. Generalized applications for account- these machines. ing, inventory control, and other applications are Electronic Typewriters. –Electronic typewriters available to avoid the cost of developing custom have limited word processing capabilities built into software. The equipment is self diagnosing so that the circuitry of the machine. The repertoire of the much of the required maintenance can be handled machine is fixed and the purchaser does not have by replacing failed components from an inventory the option of either expanding or modifying the of spares. capabilities. Most minicomputers offer office-oriented soft- Integrated Office Workstations.–Integrated of- ware such as word processing and can support net- fice workstations are now being developed that works of terminals in addition to supporting con- combine a personal computer, telephone, and mo- ventional data processing services. Some are in dem in one desk-top device, providing a voice, text, direct competition with the shared-logic’ systems and data terminal that can communicate with other sold by the office machine manufacturers. Some computers. First generation versions are now com- firms that entered the market as office machine ing on the market, Whether this market will de- providers have expanded their product lines to in- velop probably depends on how integrated work- clude shared-logic systems with a significant range stations compare in price with enhanced versions of data processing capabilities. Some of these sys- of conventional personal computers. The end that tems fit at the top of the range of microcomputers is sought through integrated workstations is usu- while others can be classed with minicomputers, ally to allow files and documents in preparation However, all computers that offer users the oppor- to be shared and passed between coworkers, or be- tunity to share resources, whether they are labeled tween professionals and support personnel. How- shared-logic word processors or general purpose ever, some designers speak of the need for a “mul- minicomputers, create new problems for managers tifunctional electronic office automation system who must allocate the shared resources among compact enough to fit into a relatively small office competing demands and at the same time protect area” and including in one unit an electronic type- the integrity of the organization’s data.8 writer, personal computer, word processor, laser Mainframe or Large-Scale Computers.–Main- printer, copier, electronic mailer, filer, telephone, frame or large-scale computers are normally asso- modem, and facsimile machine.6 Many users are ciated with data centers and/or data processing likely to create their own integrated workstations departments. They are capable of supporting a through add-ens, modifications, and software pack- large number of users simultaneously, providing ages. Ultimately integration will come about in a them access to large databases and libraries of com- different way; it will result from the fact that 7 A shared-logic word processor uses a central computer to support almost all information will routinely be available a number of word-processing terminaIs. Many are, in reality, minicom- in digitized form. puters that are limited only by the software that is available to support them. “The problems of resource allocation and system integrity exist in the microcomputer/stand-alone word processor environment as well. ‘John Vacca, “Key to Automated Systems Lies in Miniaturization, ” But, they change in substance and magnitude in shared resource The Office, February 1985, p. 66. systems. 374 ● Automation of America’s Offices puter programs. Although these computers are ca- Data Capture Devices pable of supporting routine office operations such as word processing and small database systems, The Keyboard.-The keyboard is likely to remain they are not much used for such limited appli- the dominant data input device at least through cations. the remainder of this century, augmented by the Where processing capabilities are distributed mouse, wand, touchscreen and other devices for 9 among many devices in an information processing specialized tasks. But this assumption, while it network, large-scale computers may function pri- is perhaps the most obvious one, can certainly be marily as repositories for data and programs that questioned. In fact, the most important question are to be shared throughout the organization. Data about office automation, from the standpoint of and programs can then be communicated from the effects on future employment, may well be the out- mainframe to a small computer for processing. look for input technology, especially optical char- Drawing from databases stored on mainframe com- acter recognition. puters ensures that all users will have a common OCR.–State-of-the-art optical character recog- base of information, but new problems of coordi- nition (OCR) devices can now read typed, printed, nating data input and updating activities are cre- and some hand-printed material in a limited num- ated. Generally, office work does not challenge the ber of fonts. ’” Some OCR equipment can automat- computational capabilities of mainframe comput- ically feed about 75 pages into the reading device; ers, but as applications that include voice and pat- recognize characters in 23 different fonts, whether tern recognition become available, greater process- in 10 or 12 pitch or proportionately spaced; read ing capabilities may be required. the material into the computer’s memory at the Supercomputers. -Supercomputers are very high rate of one page every 15 seconds; and format the performance machines with capabilities approach- text. The claimed error rate is one per 300,000 char- ing 100 million instructions per second. These sys- acters. Such systems are now being offered for tems are being delivered to universities, govern- prices under $12,000. ment agencies, and a few private companies who OCR can already input a typed document into word processing 40 to 50 times faster than a typ- have particularly intense computational require- 11 ments. Machines in this class as yet so far exceed ist can rekey board it. It can capture data from the requirements of the office that they are not order forms, application blanks, ticket stubs, etc. found in conventional data processing centers. Publishers are beginning to instruct authors to use The laws of physics limit the computational specific fonts on their typewriters or computer speeds of conventional computers. Therefore, the printers to avoid the need for retyping. Banks are supercomputers are structured to perform many now introducing Automatic Teller Machines that operations in parallel rather than sequentially. will accept, read, and cash a check. Problems must be described in terms that make Within a decade OCR may be able to read all it possible to take advantage of parallel process- standard fonts, and have some capability to rec- ing. Descriptions of office operations with this in ognize, isolate, and read or copy specific bits of mind have not been accomplished. Potential office information. It will be much more difficult to de- applications for supercomputers that come immediately to mind include the processing of voice in- 9The mouse is a palm-sized device, used with some computers, that put by pattern recognition. when moved over a table surface positions a cross-hair curser on the The range of processor capabilities now avail- VDT, using mechanical, mechanical analog, opto-mechanical, optical, and hybrid sensors. Touch-sensitive screens allow direct positioning of able more than covers the range of office needs. a cursor on a screen through touch; one approach surrounds the screen Moreover, technological developments are likely with infrared light-emitting diodes and sensors, the other places a resis- to proceed at a pace sufficiently rapid to stay ahead tive or capacitative layer on the screen that acts as a pressure-sensitive switch. While these kinds of input are swifter than keyboarding instruc- of the ability of office applications to challenge tions, they have limited uses in most offices. them. More importantly, users of office automa- ‘“With OCR, a page is scanned with light. White, or background, portions reflect the light and inked portions absorb it. The resulting tion will be able to acquire processing capabilities image is recognized, digitalized, and fed into a circuit. There are two appropriate to their needs and as those needs in- approaches to character recognition-matrix matching (the character crease, expand those capabilities incrementally. is gridded and compared to templates) and shape analysis (features of the character are abstracted and used for identification). The latter is Even the smallest users are likely to be able to most useful where characters are less predictable, as with handwriting. enjoy the benefits of the technologies. “E. Polizzano, The Office, February 1985, p. 75. ——

App. A—The Technology of Office Automation ● 315

velop OCR devices that can read handwritten ma- and used is of course steadily increasing, and likely terial except in very limited, constrained form. to increase still more if the cost of data-handling During this early stage of office automation, decreases. Nevertheless, since more and more of some offices are using OCR to deal with the prob- the data will be digitized from the beginning, or lem of incompatibility of equipment. Advanced can be captured with only one keyboarding at one OCR systems can take the hard copy printout from point early in its processing, the amount of manual one computer or word processor and forward it into data entry to be done is likely to decline steadily. incompatible systems without rekey boarding. *2 In OCR is a technology for translating hard copy another current application, time-sensitive forms into machine readable form. But as time goes by for reporting hours worked are marked by the more and more data will be digitized from the be- worker with a felt tip pen, collected or “batched” ginning, and be translated into hard copy only and fed into a scanner, which checks them for when a paper version is needed. length and completeness, flags errors, accepts only Machines can read a variety of formats to cap- data thus checked, and stores it for further proc- ture information. Optical wands can read bar codes essing. OCR systems are now being used for proc- and alphanumeric characters printed in suitable essing subscriptions, proxy cards, surveys, orders, formats. The scanner used in supermarket check- sales call reports, piecework payroll data, utility out lines and wand readers used in retail stores meter-reading, tax bills, and tax payments. to gather inventory data are examples, Mark sense OCR print elements are readily available now document readers have been used in a wide vari- for office printers. If OCR reading capability be- ety of applications for years. In some applications, comes a standard component or add-on to stand- the IRS Form 1040 EZ, for example, computers ard office computers, printed and typed documents can read manually printed characters. Cash reg- coming from outside the organization can be en- isters and a variety of machines can be connected tered without rekey boarding. The possibility of to computers so that data capture becomes a by- transferring information from one medium to product of operations such as recording the de- another (e. g., from a printed page to a computer- tails of a sale. ized data bank) without a second keyboarding, or Speech Recognition Input Technology .–Speech capturing data at the point of origin (directly from Recognition Input Technology (SR) could in the- a ticket agent in the field, from a customer’s or- ory mean that data need not be keyboarded even der, or from business correspondence) rather than once. This technology is however likely to develop sending it to the receiver’s central ADP unit could much more slowly than OCR. 13 State-of-the-art, greatly reduce the volume of secondary data en- commercially available SR technology can recog- try that is now done. If OCR can be improved so nize from several hundred to 5,000 different words, that it can read handwriting, the potential for labor- spoken by a single individual for whom the device saving is even greater. has been programmed. However, for most SR sys- Optical character recognition technology has not tems the words must be spoken clearly and with been widely introduced into offices in the past be- a pause between them, and there is still an unac- cause of relatively poor performance and high ceptably high error rate. Vocabularies are still too costs. Software has been a particular bottleneck. limited to be very useful. But performance is now rapidly improving. Speech recognition has been used in some envi- In principle, combining OCR with facsimile tech- ronments with limited success. For example, bag- nology (FAX, or electronic transmission of images gage clerks at airports speak flight numbers for from hard copy to hard copy) is attractive since routing baggage through automated baggage han- OCR involves substantial data compression. This dling equipment. would allow FAX transmission to consist of inter- mixed ASCII code and digitized image bits. For ‘ ‘Speech creates variations in air pressure that are transduced into this purpose, OCR will have to handle graphics, electrical signals that are then broken down into their component fre- which it cannot do yet, quencies. In the processing system, words have to be time-aligned to With the present rate of OCR development, by compensate for tbe variations in their length when they are spoken. When a machine is “trained” for one speaker, he or she creates word the end of this decade today’s volume of manual templates to which the SR system matches words. In another approach data entry could be reduced by a significant the system extracts consonant and vowel features and recognizes in- amount, with a much greater reduction by the end variant relationships among them. This is aimed at allowing the s}’s- tem to accept voice input from any speaker, but at present it is diffi- of the century. The amount of data that is collected cult to reduce the error rate below 10 percent. Continuous speech recognition is also complicated by the fact that the acoustic properties ‘Polizzano, Ibid., p 75, of a word are modified by adjacent words and by its place in a sentence. 316 ● Automation of America’s Offices

IBM and Kurzweil have demonstrated voice- will increase where users will be willing to accept -activated typewriters that may represent steps on information displayed on a screen in lieu of having the road to viable machines for use in the office. it printed on paper. Many people will find that It is conceivable that a commercially viable voice- using a computer keyboard or alternative data- -activated typewriter will be marketed by the mid- entry device gives them more flexibility and is dle of the 1990s. preferable to the traditional pad and pencil. A few SR developers are now claiming to offer continuous speech recognition-that is, recogni- Storage tion of speech at a normal pace and rhythm, without artificial pauses; and the ability to accept voice Conventional Storage Media. -From the time of signals from people for whom the equipment is not the first computers, there was a very strong di- specially programmed. A vendor recently announced chotomy between machine processable data and a possible breakthrough in SR technology-a dig- data that could be easily read and used by people. ital filter chip integrated circuit that, when used Punched cards, magnetic tape and disks and in sets, is said to allow something approaching the punched paper tape not readable by people were, sound processing capability of the human ear. It and continue to be, the data-storage media. The is to be combined eventually with artificial intelli- computers that could read them were not readily gence techniques to allow software to deal with accessible to users. This has changed to an extent such peculiarities of the English language as homo- as terminals and personal computers have become phones (words that sound alike, such as “to,” “two,” readily available. and “too’)14 Paper is a “people medium. ” Together with mic- If SR is improved so that it can recognize up rofilm it is the primary means of creating a per- to 10,000 or 15,000 words of continuous speech, manent record and a primary way of transferring from multiple speakers, it can be used to put data information between people, and also the primary into a computer for memory or processing, thus means used by computers to convey their output automating many office functions—taking dicta- to users. Paper and microfilm are not media that tion for correspondence, dictating rough drafts of have been usable by computers for storing data documents, accepting commands to the computer, for further processing. recording observations as a worker reports on other The media used for storing data should support activities, keeping minutes of meetings, and per- the delivery of data to the user’s location. There- haps most importantly accepting customer’s orders, fore, a key element that distinguishes alternative complaints, or inquiries over a telephone. If it can data-storage media is the degree of portability it eventually be combined with speech synthesis out- offers. A large capacity magnetic disk is perma- put technology, the computer might provide many nently attached to a computer. If the data is to basic customer services without human interven- be transferred to another site, it must be tran- tion or with very little human backup—for exam- scribed to another medium. Magnetic tape and ple, taking airplane or theatre reservations over portable disks can be shipped without transcrip- the telephone. tion, but are not efficient if only a limited amount Even by more conservative expectations, SR of data is to be moved. Punched cards, on the other could make some of today’s data-entry work un- hand, are very efficient for moving limited amounts necessary by the end of this decade. It is conceiva- of data, especially if it can be put in the standard ble that OCR and SR together could displace a 80 character format. significant amount of data keyboarding during the Traditional data processing installations have 1990s. always stored large amounts of data primarily on A related technology, voice identification, may magnetic disk and tape. These media support data- have some special uses in offices; for example, pro- bases that contain millions of pages of data. Disks viding security for facilities or computers by iden- are available in two broad classes. The first, capa- tification of authorized users. ble of holding hundreds of millions of characters In general, technology will diminish the distinc- on a single unit, are the so called “hard” disks that tion between information that is machine proces- are permanently attached to a computer. The large sible and that which is not. The number of cases capacity disk with a system that permits the sharing of resources can put immense amounts of data within reach of the users on demand. A single large “Kurweil Applied Intelligence, Inc.—a description of the new chip, KSC 2408, appeared in Technology Watch, vol. 5, Nos. 1&2, November- capacity disk drive can store well over half a tril- December 1984; and Fortune, Jan. 7, 1985. lion characters. Even the magnetic disks used with App. A—The Technology of Office Automation ● 317 . microcomputers and the smallest minicomputers ices in many major metropolitan areas. On the have on-line storage capacity that can approach other hand, floppy disk compatibility does exist 100 million characters. among office microcomputers that follow the DOS The great volume of information that can be format used, for example, by the IBM/PC, and this stored on one large-capacity disk creates some format is becoming an industry standard for of- problems. A large number of people within an orga- fice microcomputers. nization may need to access the data at one time. The storage medium used determines to an ex- Getting access to a specific bit of data maybe slow. tent the degree of control managers have over the If the data is stored on or in a limited number of data resources. Permanently mounted (fixed) disks, physical locations, the problem of contending for can be reached only through a computer to which access will always arise. There may be technologi- access can be tightly controlled. Magnetic tapes cal ways to provide multiple access paths to the are stored in a controllable central facility. The task same surface (whether that be a disk, tape, or other of controlling access to data stored on floppy disks object), but as will be discussed later, optical disks is much more difficult. designed for small computers may make it practi- In spite of talk of the paperless office, paper could cal to provide multiple copies of databases. be widely used as a medium for storing data in This however creates other problems. With many some future automated offices. For decades, the copies of the database there is no way for an orga- punched card has been valuable as a turn-around nization, or user, to make sure that all copies are document, for example, inventory cards and checks identical, or are properly updated and corrected. printed on punched card that could be machine This can also raise legal, ethical, and psychologi- processed. Today, the punched card has disap- cal problems—e.g., questions about the ownership peared from many applications. But technology of information and willingness to share it. Choices is now available that can read data that is printed about data-storage mechanisms will be a matter in a variety of formats. Packages can be imprinted of costs and management priorities. with a machine readable bar code and credit cards Floppy disks are generalIy used with microcom- with numbers in a scannable type font. In addi- puters and have capacities that range in the hun- tion, standard fonts used by typewriters can be dreds of thousands of characters. These offer the read by optical character readers. advantages of low cost and high portability; they Therefore the printed page can be used as an can even be sent through the mails. Three sizes external storage device for data that will be proc- of floppy disks are used with office systems—3.5 essed by computers, because the cost of convert- inches, 5,25 inches and 8 inches in diameter. The ing the printed image to the electrical signals proc- last are most often used with stand-alone word essed by a machine is becoming relatively small. processors, the first and second by microcom- Operationally, however, devices that read printed puters. The 3.5 inch disk is just entering the mar- pages are not likely to replace the magnetic disks ket but may become the medium of choice. It is and tapes that are used to store data since the char- packaged in a hard case that protects it from inad- acter reading devices are much too slow for any- vertent damage, and its capacity of about a half thing but capturing data inputs for office systems. million characters far exceeds 360,000 character Processing will continue to be performed using an capacity of the most popular 5.25 inch floppy disks. electrical representation of the data, but much of The portability of floppy disks can be in part the data may be captured initially by scanning. illusory. Virtually every word processor using eight From time-to-time there is heightened interest inch disks uses a disk-storage format that is in- in the use of microform (microfilm or microfiche) compatible with all others. The same is true for technology in the office. It is often used for stor- 5.25 inch disks that are used on microcomputers ing information where large volumes must be ar- supported by the CP/M 8015 operating system. If chived for an extended period. Financial institu- data and programs are to be transferred on disks tions routinely microfilm all checks. Computer between machines that use incompatible formats, manufacturers distribute infrequently used docu- a conversion process is required. There are busi- mentation on microfiche. There are some systems nesses that specialize in offering conversion serv- that facilitate the retrieval of information from microform files by coupling a computer to the read- ‘“An operating system is a program for a computer that performs ing device. Microform systems have been proposed many of the overhead functions required to manage the machine, Among the services it provides are those needed to move data and pro- that would have information recorded as conven- grams between external storage and the main memory of the computer tional images in one portion and as a machine for processing. processable hologram in another.

52-644 0 - 85 - 12 318 Automation of America’s Offices

Optical disk technology may provide a viable Image Processing.–Image processing capability means for on-line retrieval and processing of the will be readily available as part of, or an add-on types of records that would now be stored in a to, small business computers in the near future; microform retrieval device coupled to a computer. it is already available from some vendors. It will If so, microform may be permanently relegated allow drawings, photographs, maps, and other to the task of preserving large volumes of infre- forms of graphic information to be scanned, stored, quently accessed records. incorporated into databases, copied, or rearranged. Optical Disk Storage.–Optical disk storage can It will allow parts of these images to be removed, potentially provide 25 times the per-disk capacity added to, switched to a new location, or otherwise of magnetic disks, at one-thirtieth of the cost. The modified. Image processing has many uses in a equivalent of 250,000 typed pages can be stored general office, such as in presentations and facil- on one disk.16 A read-only disk already available ities planning, and it will be very important in some in the United States carries the equivalent of specialized offices such as those in the real estate 100,000 typewritten pages on a 4.7 inch diameter industry, marketing, and advertising. It should be disk. A number of optical disks, making up a very noted that for the unscrupulous, image process- large database, can be stacked and sorted and ac- ing can be a tool for counterfeiting, misrepresen- cessed like platters in a jukebox. tation, and fraud. Optical disk storage is still in the development Special-Purpose Terminals.–With falling hard- phase, but the development is moving rapidly and ware prices, it is reasonable to expect the develop- reaching the market faster than expected even a ment of special purpose terminals. Some are al- year ago. It is likely to have a major effect within ready used, for example, to gather inventory data this decade. Diode lasers are used for “writing” through either a hand held keyboard or an optical data on optical disks in digital form. The disks may wand. Pocket-sized terminals with a key pad and be “read-only,” which means that users cannot small display screen, that can be easily connected change them; or they may be “write-once,” mean- to a telephone, may become available soon. ing that users can record but not wipe clean; or they may be erasable. Read-only disks are useful Portable computers that maintain memories mostly for archiving. when the power is turned off can be used to gather At least 30 American companies are working on data to be transferred at a later time to another development of optical disks, but it was generally computer, either directly or over the telephone believed until recently that the Japanese held the lines, In this way, a traveler can, while on an air- lead in development of erasables. In March 1985, plane, create a document to be transferred to the 3M Corporation announced that it would immedi- main office system for further processing and ar- ately begin producing (in small quantities) 51.25 inch chiving. erasable laser disks that will store the equivalent Personal Storage Devices. -Machine-readable and of 250,000 pages, the capacity of 25 magnetic hard updatable data storage devices exist that can be disks of the same size. ” They are designed for personally carried or attached to an article in tran- microcomputers, and will allow data to be moved sit. Included among these are the familiar credit and changed or erased just as on magnetic disks. card magnetic stripe technology18 and the “smart” This will let personal computers perform many card that contains a microprocessor and memory. 19 tasks that until now could only be done on a — “The fare card used on the Washington, DC, subway system pro- minicomputer or mainframe. vides one example of what can be done with magnetic stripe technol- Because optical disks have such a large capac- Ogy. When the card is purchased, the purchase ~ralue is recorded on the ity it becomes reasonable to use them for storing stripe, Then, whenever the user enters the system, the station of origin is recorded. At the destination, the fare is ccimputed based on the images as well as alphabetic and numerical data. recorded data and the value of the card decremented appropriately. Sim- This capability will make it possible to organize, ilar cards could be used to capture and store data for office applications process, and present data more effectively than where very low data volumes are involved and the connection of computers by telephone is unwarranted. is possible when image and textual data must be ‘“A Canadian company has designed a hospital information system stored separately. around the smart card. When the patient enters the hospital, a card is created. Then the card moves with the patient and as each service and product is dispensed, the memory of the card is updated using a device built into a microcomputer. When the patient is discharged, the ‘“In early 1985 a draft of this report said, correctly, that the best data that has been captured during the hospital stay is retrieved and commercially available optical disk (read only) stored 1 billion bytes or a bill is prepared. It is conceivable that the “smart” card, originally the equivalent of 40,000 pages. By June that statement was incorrect, designed for executing financial transactions, could find significant ap- This is an example of how rapidly events are moving in this field. plication as a data capture and storage medium in a number of office “Brian Dumali, “Here Comes the Erasable Laser Disc, ” Fortune, applications that range from systems for prov]ding security to those Mar. 4, 1985, p. 100. that require capturing transaction data. App. A — The Technology of Office Automation ● 319

Communication The opportunity for offering an increasingly large variety of telecommunication services through In the present context, communication includes the switched telephone network derives from the all technologies that are used to transmit data fact that much of the switching capacity now in between people, people and computers, and com- place is provided through computers. Eventually, puters. all switching will be done by computers. Already, Telecommunication Networks.–The backbone of much of the traffic between major switching cen- office telecommunication is the switched telephone ters is transmitted digitally; and customers are network. It was designed to handle voice commu- able to subscribe to on-site digital transmission nication passing between individuals, and still services. They are then able to mix digitized voice functions primarily in this mode. However, data and data traffic. Much attention is now being given comprises a growing portion of the traffic. worldwide to the concept of an integrated service For many organizations, the switched telephone digital network (ISDN) that would make digital network consists of two relatively distinct parts. transmission of all data, voice, video, and facsim- First is the conventional and ubiquitous interor- ile traffic universally possible over a common net- ganizational component, the dial telephone serv- work. ice. No operator intervention is required even for many international calls. Credit card calls can be For some years, 1ong distance telecommunica- initiated using the 10 key TouchTone’h’, and some tion services have been offered by competing pro- pay stations are now being equipped with devices viders. However, since the divestiture by AT&T for reading billing information from the magnetic of its operating companies in 1984, the choices have stripe on the back of a credit card. become significantly more complex. Organizations The repertoire of services available from the now have the option of using either the switched switched telephone network will expand over the telephone service or operating their own telecom- remainder of the century unless legal or regula- munication networks, Most often, a private net- tory constraints are imposed. Simple services such work is assembled using circuits and support fa- as call waiting, call forwarding and three party con- cilities leased from telecommunication providers, ferencing are already offered in many areas. Some some combination of the local telephone company, code conversion services offerings by local operat- and one or more providers of long distance serving telephone companies were recently approved ices. However, some organizations choose to build that would translate the signals from one type of and operate telecommunication networks that in- computer or terminal to a format understandable clude privately owned facilities as well as capacity by another. Such services will be valuable to offices leased from common carriers. Alternatives include that until now had to provide code translation leasing of transponders on satellites, the building through their own systems. Not all businesses are of microwave systems and the construction of con- prepared to deal with the code conversion prob- ventional telephone circuits. One problem is that lem and the detailed technical questions of inter- large users of telecommunication services often change. find it in their interest to by-pass public utilities, The future is likely to see such services as voice depriving them of significant revenues. message storage offered through the switched tele- A variety of providers offer business telecom- phone network. Virtually all telephone traffic, in- munication services. Third-party operators either cluding voice, will be transmitted digitally. Orga- build facilities or lease them from another carrier nizations will no longer have to maintain separate and use them to offer services to those who can- networks for voice and data communication. It will not justify developing private networks. Packet also be technologically possible to deliver process- switching is used to obtain the high rates of utili- ing services through the network, including the zation that are needed to justify third-party net- routing of messages based on their information works. Messages are broken into data packets that content. For example, the interchange of financial are individually routed to their destination and transactions (now accomplished by financial insti- reassembled to constitute the original message, tutions) could be a service of the switched telephone Network operators can bill users on the basis of network, and this could include data processing traffic volume rather than time and distance, be- such as the accumulation and reduction of trans- cause the packet switching technique levels the action data and following the enroute status of load across the available network facilities rather shipments. than allowing it to concentrate on the paths be- 320 ● Automation of America’s Offices tween points with the highest volumes of traffic problems posed by this application have yet been flow. resolved. 20 Many localities are wired for cable television, and PBX and Local Networks.—Managers of offices many of the newer systems are capable of two-way are now faced with complex telecommunication communication. Because television requires a choices. A few years ago, arranging for telecom- broad channel, cable systems can handle large data munication services required only a call to the lo- volumes. In some areas, such as New York, cable cal telephone company and everything was taken operators find it profitable to make some of their care of, Today users can tailor services to their capacity available for transmitting voice and data. needs and shop for providers who can offer the In congested areas, not all telecommunication required services most economically. However, the options are available. For example, in New York user organization has to devote more resources to City it has become very difficult to build private analyzing the costs and benefits of alternative tele- microwave facilities because buildings often ob- communication services. To an extent, the settle- struct the proposed path for the signals and fa- ment of the antitrust suit negotiated between cilities already in place cause electromagnetic in- AT&T and the Department of Justice has led to terference that cannot be neutralized. Routing this increase in complexity. However, even with- communication to a central antenna “farm” lo- out the divestiture, advances in technology were cated in an area relatively free of these obstruc- increasing the options available to users. tions (the teleport concept) provides one alterna- Adding to the telecommunication options avail- tive for neutralizing this problem. In some cities able to managers are other technologies available the cable tunnels beneath the streets are so con- for in-office communication. At the lowest level gested that there is no room to run additional ca- are electronic replacements for the 1920s plug bles. Fiber optic circuits provide potential relief switchboard to permit intraoffice communication from this problem because they provide substan- as well as connection with the external network. tial increases incapacity in significantly less space Modern private branch exchanges (PBXs) can pro- than conventional cables. vide a variety of services, including the ability to Mobile Communications.— For local communica- forward calls from one office to another and to auto- tions, offices also have the option of using mobile matically transfer calls to another number once telephone services. The most common are the a predefined number of rings have gone unan- “beeper” services available in many areas. A per- swered. PBXs can be programmed to record voice son is alerted to a call by an audible tone gener- messages and to select from the alternative serv- ated in response to a signal sent by the service ices available the most economical routing for each operator and received by a carried device. Some call as it is placed. Some provide for the sharing devices can visually display a message, eliminat- of internal telecommunication circuits for both ing the need to telephone the office for information. data and voice, giving the user organization the Telephones in cars have been available for years, benefit of a shared internal network. but the technology severely limited the number Another alternative for use within an organiza- that could be used within a geographic area. A new tion is a variety of local area network (LAN) tech- technology, cellular radio, has eliminated this limi- nologies. These provide high-speed data communi- tation on the number of mobile telephones. In addi- cation for a variety of office machines, including tion, the quality of the service with the cellular data-storage devices,21 printers, word processors, system is significantly better. Companies requir- gateways to external telecommunication networks ing constant telephonic communication with peo- and professional workstations. Several technol- ple in the field can now have such service at rela- “)Cellular radio operates using a number of low-power transceivers; tively affordable rates. In the future, cellular radio computers are used to assign traffic to the one of many antennas that may also provide an alternative for delivering fixed is best able to communicate with the mobile unit. As the mobile unit moves from cell to cell, traffic is handed from one antenna to another. point telecommunication services to rural and re- This handoff procedure could introduce discontinuities in the signal that mote sites more economically than is possible with offer no problems for voice communication but could present problems conventional telephone lines. Potentially, this tech- for data transmissions. “Most often disks that can be used to store data of interest to a nology could also permit the transmission of data number of individu~s and/or organizational elements and shared by a to and from mobile terminals, but not all of the number of workstations, App. A —The Technology of Office Automation ● 321 — ogies for implementing LANs are in use; 22 and this Higher speeds require the use of circuits that diversity of incompatible technologies using a va- are dedicated to a specific customer. These may riety of LAN architectures may present problems. be leased from a common carrier or built as a pri- But most LANs include the ability to carry on com- vate venture. Commonly, these lines are rated at munications over the switched telephone network, 19.6 and 56 Kb,24 The highest capacity lines are so that the switched network becomes a common called T1 carriers and are rated at 1.544 Mb. 25 Sat- facility over which dissimilar LANs are able to ellite transponders have capacities on the order communicate. of 6 Mb. To an extent, modern PBX and LAN technol- Interactive communication that involves people ogies are competitive. Both provide the ability to usually will not challenge the capacity of a cir- switch data at relatively high speed between of- cuit capable of handling 30 characters per second. fice machines. On the other hand, LANs will be Higher speed circuits are needed only when large useful for voice transmission only to the extent amounts of data are to be transferred directly be- that the telephone instruments that are connected tween computers. to them can send and receive signals in a digital However, there are technologies for multiplex- format. ing many signals over a common line. Thus, many An interesting variant in telecommunication lies slow-speed conversations can be combined to take somewhere between the public switched network advantage of the economies attainable when high- and intra-office communications facilities; this is speed circuits are used. A company with offices the smart building with which some realtors are in two major cities may find it useful to provide experimenting. These buildings are wired for tele- one high-speed circuit between the two points. communications and data processing services so Some of the private lines can use the capabilities that multiple tenants can use technologies avail- of a PBX to connect with any number in the re- able in the past only to large organizations. A mote city through the local switched telephone net- smart building may provide outlets that permit work, thus bypassing the long distance dial-up net- all tenants to connect terminals to a common word work and its toll charges. This reduces the revenues or data processing facility. Other outlets may be to the long-distance carriers, and, indirectly, reve- used for telephone connections to a common PBX nues to the local-operating companies. that routes calls within the building or complex Communication Terminals.-The most ubiquitous without using the public switched telephone net- communication terminal in the office is the telework, or routes external calls using the most eco- phone, basically an instrument for accomplishing nomical service. High-cost facilities like laser voice communication between two people. How- printers and reprographic facilities can be shared. ever, computers have been programmed to accept Once digital information has to be transmitted the tones created by a TouchTone’” telephone and more than a quarter mile over conventional tele- respond to them using computer generated voice. phone circuits, an instrument called a modula- When a customer enters the long string of num- tor/demodulator (modem) is required, to convert bers required to use long-distance services pro- digital signals used by the computers to or from vided by other than AT&T, the data (access code an analog signal that can be handled by the and number dialed) is received and processed by switched telephone network.23 Commonly available a computer. Telephone bill paying also uses the modems are capable of transmitting or receiving common telephone as a data terminal. 30 or 120 characters per second over the standard The telephone is suddenly a rapidly evolving in- switched telephone network. Modems capable of strument. Display screens are being added that handling 240 characters per second are becoming let the user view a number from an electronic direc- widely available. Speeds of 480 and 960 charac- tory before instructing the telephone to dial it auto- ters per second can be achieved by some premium matically, Telephone handsets are being added to instruments. data terminals so that the user can communicate voice and data interchangeably over a common — circuit. When coupled with the PBX, the office tele- Alternatl\c transmission techniques include broa[ihand and base- band signaling The technologies for managing traffic include token phone becomes a versatile, multifunction commu- ring passing and collision detection and retransrnis>ion in th[> c~ent of a collision between messages. - Actually, a digital signal can onl}’ be tran~mitted a few hundred “Kb is kilohits per wcond or 1,()()0 hits per second A charac[cr feet without a modem. }[oweyer, limited distance nlt}denls, low c{~st transmitted at [hese speeds n{)rnlallj requirt~~ the transmission of eight rnodcls with limited capabrlitl[+, can be usc~d for di~tances under a quar. bits. ter mile. u Mb is millions of bits per second 322 ● Autornation of America Offices

Photos Courtesy of Bell Labs

In 1877, the first commercial telephone was leased to a Boston banker. The round, camera-like opening on this box instrument served as transmitter and receiver. By the 1980s, the telephone and display monitor were integrated. This terminal can access files from other computers and perform a full range of telephone management and message functions. nication instrument for the office. AT&T divestiture has forced businesses to decide whether to buy or lease the telephones in their offices. The increased variety of options has forced decisionmakers to carefully match service requirements with alternative capabilities. People now communicate with computers, and computers communicate with computers. It will become more and more common for computers in one organization routinely to interchange information with computers of another with little human intervention. For example, a computer can determine that an inventory level has fallen too low and send a replenishment order to the supplier’s machine. Alternatively, payments can be queued in a computer that is instructed to contact the computer in a financial institution and order the funds transferred at the optimal time for the debtor organization. The most common way for an individual to communicate with a computer is by means of a terminal that uses a typewriter keyboard for entry and either an electronic display or a printer for output. The terminal, in its simplest form, captures input This example of a 1907 Magneto wall set was in use from the keyboard, transmits it over the telecom- from the late 1890s through the 1930s. munication line, receives data from the computer, App. A—The Technology of Office Automation 323 and displays it either on paper or a screen. This costs, it has not been well accepted. Some people kind of terminal has no processing capabilities. may like travel because it is a break in the day-to- With these “dumb” terminals, the user depends day routine. on a central system for all computational support. Increasingly, however, the terminals used to Display and Printing communicate with computers will have significant processing capabilities in their own right. Some The primary means of presenting information will have printers attached to them directly, but to users is by means of a display screen. The standard display screen now in use is the cathode ray in the office, printing will increasingly be done by printers shared among the terminals that comprise tube, a specialized version of the television picture tube. There has been considerable controversy re- a network, garding whether prolonged exposure to the radia- Teleconferencing.– Information processing and tion from cathode ray tubes has long-term impli- telecommunication technologies can be used to substitute, at least in part, for face-to-face meet- cations for the health of the user. (See chapter 5.) ings of individuals. Two broad classes of telecon- The question may well become mute as new display technologies become available that are more ferencing are computer conferencing and videocon- attractive, take up less room, and do not depend ferencing, both insensitive to distance. A computer on high-energy beams26 to generate the display. conference is also insensitive to time, in that people Liquid crystal displays are used on most of the participate independently on their own schedules. lap computers now and plasma displays appear A computer conference is conducted by providing all of the conferees access through their termi- to be just over the horizon. A by-product of this nals to a distant computer on which are recorded display technology will be the flat screen that can hang on the wall, taking up no more room than their contributions to the conference and from which they are able to retrieve the comments of a photograph or painting. Display technology has improved so that it is the other participants. The conference may take possible to create finely defined images on a ter- place over an extended period, and each individ- minal screen. Color displays can cost three times ual contributes at times that are personally con- the price of a monochrome monitor; some special- venient. Conferees sometimes are allowed to make ized office users find the benefits worth the addi- their contributions anonymously or using a pseu- tional cost. donym, in order to encourage them to be more frank than they would be in a face-to-face meet- Electronic Document Preparation.- The printing ing. Computer conferencing permits the users to of documents may increasingly take place only at the last step in the document creation process. Doc- ponder their thoughts rather than react to the dynamics of the group. This can be either an advan- uments will be created and transmitted from point- tage or a disadvantage; the body language and to-point electronically because of the delays in- other forms of nonverbal communication that occurred in sending paper. The trend is toward rapid convergence of print- cur in a face-to-face meeting are absent. ing, copying, and typesetting technology. They Videoconferencing permits conferees at widely may also incorporate color sensing and image proc- separated locations to both see and hear one essing in designing and modifying output. another via a television link. Several levels of vid- Multibin, multicolor, jetspray and laser printers eoconferencing are now available. One provides are already becoming common in offices and are only for the transmission of stop frame pictures likely to increase in capability and decrease in costs where the image seen by the viewers changes only for several years. Reprography (copying) technol- every several seconds rather than continuously. ogy is also becoming more sophisticated; print At the high end of the spectrum is full-motion color quality is improving and speed is increasing. Some video transmission that provides a level of quality of the capabilities already in the market or likely at least as good as commercial broadcast television. to be available soon are the ability to store and As one moves to higher quality of service, however, costs ‘increase markedly.

Some corporations and at least one common car- ‘The display on a cathode-ray tube is created h} a +trt~:im of high- rier have installed videoconferencing facilities. At speecl electrons that strike a phosphor on t hc~ face of the screen and best, success as measured by market growth has cause it to lumine~ce. At least some of the electrons continue past tht’ face of the tuh[~ for some distance before losing their energy It is the’ been marginal. Although this technology has been electrons that continue past the screen face that gi~”e rise to concern~ heralded for some time as a way of reducing travel about radiation hazard from cat hode-ra}-tuhe d i ~pla}’s. 324 ● Automation of America’s Offices —

25 Years of Xerography in the Office

[ Xerox 9200 (1974)

Xerox 1020 (1983)

Xerox 1090 (1985) ‘‘preii r(l

Credit Xerox Corp App. A —The Technology of Office Automation ● 325 use form overlays, to assemble a composite image coming that will be able to accommodate compara- with parts taken from many sources, and to auto- tively unstructured demands. The need for most matically size an image to fit the space available. users to develop programming skills or use the As these technologies improve, it is likely that services of a trained programmer is diminishing. many organizations will do their printing of forms Early applications of advanced technologies were and documents as they are needed. The cost sav- for highly structured procedures such as payroll, ings that are possible by reducing the warehous- general-ledger accounting and the processing of ing of documents is large, and this is augmented financial transactions. They were operated by by savings from reduced waste (no stocks of un- highly trained specialists and did not have to be used documents and obsolete forms to be disposed designed to be used directly by large numbers of of), and reduction of labor time spent in ordering, technologically unsophisticated people. As the ca- unpacking, storing, etc. An additional benefit of pabilities of applications software to accommodate on-demand printing is the ability to provide only comparatively unstructured demands for informa- those sections of a document or report that a spe- tion have increased, much of the focus has shifted cific user needs. to the organization of data and the means of mak- Documents that are electronically stored and ing it accessible to large and diverse user commu- transmitted will be complete with diagrams and nities. To date, designers of automated systems illustrations properly inserted in the text. A ma- have viewed applications in the light of the tradi- jor company has already demonstrated a printing tional computers that execute programs one step device that will combine pictures that have been at a time, sequentially. Not all of the machines of stored in a digital format with text on a single page. the future will execute processes sequentially. Optical storage, because of its large capacity, will Newer architectures now being developed to meet be a key element in making this possible. Rela- the needs of the scientific community for unheard tively small offices will be able to create documents of volumes of computations emphasize parallel that will give the impression of having been typeset. processing to achieve these capabilities. Supercom- puters are not used in today’s offices, but for some Software industries they may be the business machines of tomorrow. At some point there will have to be a Software, broadly defined, includes all of the pro- reexamination of the techniques used to design of- cedures, documents and computer programs for fice-oriented systems to make it possible to real- office computer technologies. This discussion fo- ize some of the benefits of parallel processing. cuses primarily on computer programs, Much at- During the early 1970s, much attention was given tention has been directed toward software pack- .to the concept of an integrated management in- ages for microcomputers, but as has been pointed formation system (MIS) that would meet all of the out, the combination of terminals and telecommu- needs for information of an organization. Some nication capabilities has made it possible for of- organizations undertook the development of such fice workers to interact directly with centrally oper- systems; none were particularly successful. But ated computers. Therefore, the software that runs information systems to meet the more limited ob- on larger machines is of as much interest to the jectives of specific organizational elements have office worker as that which runs on the smaller been quite successful, These range from complex computers. systems designed to serve large numbers of users Software technology consists of two compo- to personal-information systems for individuals. nents. The more obvious is the ability to imple- One of the challenges for software and system ment and operate computer programs that perform engineering is to establish effective mechanisms the operations necessary to produce the results for interchanging information between automated needed by the end users, Second, and less obvi- systems while preserving the integrity and secu- ous, is the knowledge needed to design the com- rity of all of the involved data, processing, and computer programs and related procedures. This re- munication resources. quires the involvement of the user in the design Some tools to aid systems engineers already ex- of information processing and telecommunication ist. Structured approaches to system design that systems, or full benefits of the technologies will emphasize the analysis of functional relationships not be realized. have been in use for some time. Rapid prototyp- Much of the software being developed today is ing is a newer concept that is meeting with a meas- designed to minimize the technical knowledge re- ure of success. In this technique, demonstrations quired of the users. At the same time, systems are that show the intended user samples of system 326 ● Automation of America’s Offices output and the procedures used for entering data All operating systems, regardless of the size of are developed. The rapid prototype does not in- the computer, provide input and output services clude implementation of the internal processes that for all applications. The operating system takes will comprise the system. It presents only the fa- the data that is used by an application and trans- cade that can be evaluated by the user in light of lates it into a form suitable for driving the physi- the requirements the proposed system is intended cal input and output devices. to meet, just as a wind-tunnel model is used as Generally, the computer manufacturer designs a tool for defining the external shape of an aircraft. and implements the operating system.29 In the Two classes of software are used with modern past, each manufacturer used a proprietary sys- computers. The first, support software, creates an tem, and this made it difficult for users to move operating environment that provides functions of from one brand of equipment to another. Today value to all users, including resource scheduling the trend is to standardize operating systems. For and input/output services. The second, end-user the microcomputers most commonly found in of- software, includes application programs for spe- fices, MS-DOS is a defacto standard, although com- cific users, ranging from spread-sheet processors petitors exist and some are in relatively widespread run on a microcomputer to complex, tailored ana- use (e.g., CP/M). The UNIX operating system de- lytical programs that require the services of a very veloped by Bell Labs is becoming a competing large mainframe. standard, available on a spectrum of hardware Support Software. -Support software, in this con- ranging from microcomputers to large-scale main- text, includes language processors, utility pro- frames. However, although UNIX is the focus of grams, database systems and other software re- substantial attention it is not as yet an established sources that are shared by all users of a computer standard, and in fact may never become one. Com- system.27 The software creates an environment peting systems are likely to continue to be a sig- within which a computer user operates. To an ex- nificant factor in the industry at least into the tent, a common operating system is created for 1990s. computers that are, in reality, quite different from Standardization of operating systems would of- one another. fer the user several potential benefits. The first On large systems that are shared by multiple is portability of application programs. An appli- users, operating systems manage the resources on cation written to an operating system standard, the computer, scheduling them for use by specific in theory, can be run on any computer for which applications .28 An application is permitted to be- that operating system is available with little or come active on a computer system once it has no modification. In this sense, the operating sys- moved to the front of the line and all of the data tem can mask differences among machines from it requires can be made available to it. The operat- users, and competing computers take on the ating system on a computer shared among multiple tributes of commodities not differentiable from one users also keeps the various users from interfer- another in the eyes of the users. Second, third-party ing with one another. On smaller systems that only suppliers of generalized software will tend to pre- support a single user at a time, the operating sys- pare products for use with a standard or widely tem lets the user move easily from one application accepted operating system in order to have the to another and relieves him/her of some of the rou- largest possible base of potential customers. Thus, tine tasks that would otherwise be required. For using a system for which a standard operating sys- example, a user can establish a series of commands tem is available ensures the user of a large and to perform often repeated multistep tasks, and varied supply of software packages from which to they will be executed automatically under the con- choose. This availability of generalized packages, trol of the operating system. in turn, tends to reduce the need for expensive development of software tailored to needs of a specific organization. ‘70ne could argue that the generalized packages such as word proc- Programming languages, or, more precisely, processor and spreadsheet programs so widely used on microcomputers essors 30 for programming languages, are another should be included in the category of support software. However, for the purposes of this analysis, because they are oriented to use by indi- “In the early days of microcomputers, some third-parties created viduals on personal computers, not to be shared by a number of users operating systems that were offered in competition with those created of a shared computer system, these types of programs will be discussed by the manufacturer. This practice is not widespread, but competing as end-user software. operating systems are still available for some of the most popular ‘&Some installations may determine that all short jobs will run be- microcomputers. fore long ones. Others may determine that some work, regardless of “ ]Language processors accept computer programs written by users the demands it places on computer resources, will receive a higher pri- and translate them into a form that is understandable as a set of in- ority than all others. structions to a computer. App. A— The Technology of Office Automation ● 327 set of support software. COBOL and FORTRAN task of application programming as it is under- have been the two languages used most heavily stood today. Rather, the language capabilities may for management information systems. BASIC is evolve to the point where it is no longer reason- the language most widely available on microcom- able to make a distinction between the language puters, but the common BASIC interpreter that that is used to describe a process to a computer is supplied with most microcomputers is not suited and the application program that is delivering infor very large application systems. formation to the end user. From time to time, new languages appear and Support software also includes a variety of pro- receive some degree of acceptance before disap- grams that are really applications, but fill needs pearing. ALGOL was one of these. It made some for such a large portion of the user community that headway in Europe in the 1960s but was not ac- they are properly included under the heading of cepted in the United States. The current crop of support software. Within this group are housekeep- computer languages includes ADA, C, and PASCAL, ing programs that are used to create copies of files, among others. Whether they will be able to demon- prepare diskettes for use, and check copies to see strate real staying power remains to be determined. that they are accurate. Some utilities also permit In order to use programming languages of this modification of existing data; for example, a util- type, the user must develop a degree of technical ity could be used to change all occurrences of the skill. First, the syntax or rules of the language must word “green” to “blue.” Others permit the user be mastered. Second, skill must be developed in to select from a database some records that meet describing a task at the fine level of detail that specified criteria. must be specified in a computer program. Most Database management systems also fit in the casual users of computers are more concerned with category of generalized support software. These their tasks in the office than with developing the software systems are used to organize, store, and skills required to write computer programs. Rather, access data so that it can be shared among many when the need to develop a program materializes, applications. This concept makes it possible to office workers turn to professional computer tech- manage data as a corporate resource and decouple nicians. specific applications from the databases that they The tendency today is to minimize the need for use. The difficulty of modifying both application any user to develop computer programs, The gen- programs and the databases is thus markedly re- eral assumption is that most of the needs of end duced. Changes in the data bases do not necessarily users, office workers in particular, can be met by require corresponding changes in the applications program packages available on the open market. that use them nor do changes in applications nec- At the time it announced a major new product, essarily demand changes in the databases. one of the major producers of microcomputers Some database management systems are designed made no language processor available; in fact, com- to be used in conjunction with a generalized pro- puters developed by suppliers of office machines gramming language such as COBOL, Hence, they are often delivered without a language processor. are of value only to those with programming skills. The computer languages used for application Others provide the end user with a generalized systems continue to evolve, and languages avail- query language that can be used to specify the cri- able in the future, whether or not they have famil- teria to be met by data retrieved in response to iar names like COBOL, will be different from those an inquiry. These query languages in general do available today. Software engineers have recog- not have the versatility that is found in general- nized some of the limitations of existing language purpose programming languages, but they let a structures and are developing new ones to over- user have access to data without the intervention come the deficiency. One approach is the develop- of a programmer. Many of the data-management ment of object-oriented languages that focus on systems sold for microcomputers follow the model the manipulation of processes and the entities man- of the query languages used with generalized data- ipulated by those processes rather than the defini- base management systems initially developed for tion of procedures.” mainframes. As this evolution continues, it is possible that End-User Software. -End-user software consists comparatively few people will be engaged in the of the application programs that deliver information to users. With mainframe and minicomputers, end-user software consisted of a relatively well de- “See a series of articles in the May 1985, issue of Bj’te Afagazjne, p, 151, discussing Small Talk, an object-oriented language developed fined class of programs designed to meet the needs by the Xerox Corp. of a user community. Such applications still exist 328 Automation of America’s Offices and the development of new application systems quiries against the data, and prepare summary will continue, but the class of end-user software reports are also available. is no longer so precisely defined. Now a variety These programs are designed to be used by peo- of generalized application packages such as Lotus ple with limited understanding of the technologies. 1-2-3° meet the needs of broad classes of users. Many are menu driven; the user only has to select The development of software to meet the needs an operation from a list on the screen. Most can- of specific users is expensive. The user organiza- not be operated without sometime referring to vo- tion not only incurs the cost of developing the soft- luminous, usually poorly written manuals or docu- ware, but must also maintain it. Maintenance in- mentation; but the number that require only simple cludes correcting errors as they are discovered and documentation is growing. For some of the more making modifications to operational programs as popular programs, dozens of texts explaining their requirements change. A mature data processing operation to the user have been written and are organization is likely to devote as much as 80 per- widely available in bookstores.33 cent of its programming resources to the mainte- Some packages, because of their popularity, have nance of operational applications, leaving only 20 become de facto standards of a sort. For example, percent for the development of new applications. word processors and spreadsheet programs will Many organizations are discovering that their re- sometimes note that they are able to accept data quirements for data processing services are not from one or more other widely used spreadsheet as unique as they once thought, and are turning programs. to packaged application programs. This trend is Series of spreadsheets and word processing pro- most clearly evident at the low end of the hard- grams are available, designed so that their com- ware spectrum where thousands of programs are mand structure is consistent, thus minimizing the being marketed. learning time required to use each program. Also, There are two broad classes of generalized end- the programs in a series are designed to facilitate user application programs. One consists of model- the passage of data between them, e.g., a table from ing or decision aids oriented to fairly narrow cate- a spreadsheet is easily included in a document be- gories of problems; the other includes applications ing prepared using the word processor. of general interest. Integrated, multifunction programs are also be- Application systems designed to run on coming marketed. While some of these have been rea- puters of all sizes have been developed for sets of sonably well accepted in the market, each one of problems to which a common methodology can be these programs has both its strong points and applied, such as packages for econometricians,32 weaknesses. For example, the spreadsheet capa- engineering specialties, statisticians, accounting, bilities may be powerful but the word-processing inventory control, and system-management pack- functions weak. Often, integrated packages require ages. These applications are not designed for non- complex command structures that are difficult to specialists; users are expected to understand the learn. There is some question whether it is more underlying disciplinary concepts on which they are advisable to acquire a number of single-function based. The command structures are oriented to programs that can pass data between and among the jargon of the professional. For the person not themselves or to obtain a single, integrated mul- trained in the discipline, they are not “user tifunction package. friendly. ” Instructions and owners’ manuals, which the in- The second class of generalized user applications dustry persists in calling by the intimidating name consists of programs designed to meet needs com- ‘‘documentation, ” have been a major hurdle for mon to most offices, such as data processing, beginning computer users; they are often incom- spreadsheet, and graphics packages. “Thought prehensible to the novice. But competition for the processors’ facilitate the creation of outlines and, small computer software market will sooner or later thus, help the user organize ideas. “Desk orga- force software vendors to concentrate on ease of nizers” let the user make notes or maintain a calen- use, and to emphasize usability, training, customer dar and an automated telephone index. Programs service, and software maintenance in order to build that let users create personal databases, make in- and keep a share of the market.

“Econometric programs, for example, include procedures for estimating the parameters of an econometric model, access to data useful “’Another explanation for the popularity of the texts for some pro- in building economic models, and the means for exercising models once grams is that they are being used in lieu of manuals by those with pi- they have been built. rated copies of the software. App, A — The Technology of Office Automation ● 329 —

The management information system concept ing. Development work in other areas, including that has been developing over the last two dec- the management of emergency preparedness and ades is already evolving into the broader concep- financial services, is underway. The results of these tual framework of information resources manage- efforts have so far been limited, but they offer con- ment, a field that seeks to understand the overall siderable promise. An understanding of the proc- requirements of an organization for information ess of building expert systems is developing and and to provide the means for meeting them. De- the computational power required to support them cision-support applications will comprise an im- is available to many organizations. portant element within information resources management. These applications will range from comparatively simple models such as pro forma Summary financial statements in the spread-sheet format to comprehensive models of both the internal opera- System designers and users are only minimally tions of an organization and its interactions with constrained by the information processing and tele- the environment. Models for marketing and pro- communication technologies that are available. A duction management are already in use and will wide variety of telecommunication services is also become increasingly commonplace even for small available. Capacity can be added in relatively small firms. incremental steps so that users are not faced with Much attention is now being given to expert sys- unused capacity for extended periods. tems. Some expert systems are being used, but Management can impose a strongly centralized they are generally rudimentary; and the ability of structure or substantial decentralization of deci- expert systems to deal with some of the more com- sionmaking can be allowed. Regardless of the strat- plex problems faced by knowledge workers may egy, technicians have considerable latitude in im- be slow to materialize. plementing system designs that are optimal from Expert systems attempt to capture the problem- the technical point of view while supporting what- solving knowledge and methodologies used by peo- ever management philosophy is in place. For ex- ple who have demonstrated abilities significantly ample, a centralized processing system can serve above those of the large majority of the profes- a decentralized decisionmaking structure as well sionals working in a specific area. Specialized tech- as one that is highly centralized. nicians, called knowledge engineers, interview ex- The processing and telecommunication technol- perts and attempt to define in a format processable ogies that are now available to the office put sig- by computers, a series of rules of thumb that will nificant amounts of processing power in the hands emulate the experts. Users are then asked to proof office workers and managers. The equipment vide the parameters of a problem, and the expert used to deliver processing services ranges over a system returns an analysis that is intended to ap- broad spectrum of capabilities, creating for office proximate the results that would be arrived at by managers a wide range of options for configuring the experts whose knowledge was used to struc- systems and designing the flow of work within an ture the decision rules. In theory, if there is a suffi- office. As the applications of the technologies be- cient gap between the abilities of top experts and come more widespread and the experience with the journeymen who would use the systems, expert them increases, they will have significant effects systems should significantly improve the perform- on virtually all aspects of office operations and the ance of the journeymen. ways in which office workers interact with other To date, expert systems have found some appli- elements of their own organizations and the out- cation in law, medicine, and insurance underwrit- side environment. Appendix B OTA Case Studies

In support of OTA’s study of office automation, factory, expeditors and production control clerks several case studies were performed to supplement track their progress and position them for final the many found in the management literature. In assembly. Finally, still other office workers make choosing contractors to perform these studies, con- sure the components meet the appropriate qual- sideration was given to the researchers’ scholarly ity standards and ship them to customers. qualifications, their access to the proposed study For the last 15 years, companies have used a organization, and the relevance of the study to the variety of data-entry and computer-printout tech- needs of the OTA staff. Those needs involved in- niques to create an “after the fact” tracking sys- formation on the impacts of office automation on tem. Today, the lowered prices of computer termi- organizational structure, job content, skill levels, nals and the greater sophistication of software training and employment levels. In addition, it was makes possible “real time’ scheduling and inven- desirable that the studies illustrate a variety of tory systems. Usually known by the generic term office settings. Special efforts were made to con- of “MRP” (for “Materials Requirements Planning” sult workers at all levels of each organization, be- or “Manufacturing Resources Planning”), such cause their perspectives were neglected in many systems integrate the various functions of the in- of the case studies examined. dustrial office and automatically track components The case studies summarized here were set in on the shop floor as products are produced; coordi- five types of offices– a small Federal Government nating the entire production process. agency, the Office of the U.S. Trade Representa- The focus of this study was production of gyro- tive (USTR); “XYZ Company, ” the corporate head- scopes, that contain over a thousand components, quarters of a manufacturer of a consumer product; involving 14 different levels of assembly. This was the production, planning and control department the first product to go “on-line.” With accurate of ‘Aircraft Instruments Plant, ” a manufacturer; information on the product structure and how long an international division of a large commercial it takes to either manufacture or purchase each bank (“Commercial Bank”); and three agencies of component, one can work back from the “due date” the New York City municipal government—the of the customer order to determine what compo- Human Resources Administration (HRA), the De- nents to order, how many, and when. The MRP partment of Finance (DF), and the Department of system can also schedule production by matching General Services (DGS). customer orders to plant capacity and provide feedback on the work-in-progress. This information sys- Office Automation in a Manufacturing tem can be extended to the purchasing, marketing, and finance departments. Setting’ The study of the MRP II system implementation at the Aircraft Instruments Plant illustrates Introduction and Background some of the dangers that ignoring the organiza- This case study examines the effects of com- tional dimension of technological change can produce. puter-based technology on one of the most com- It reflects how the demands of a new technological mon “offices” in American industry—those that system can conflict with traditional management handle ordering, inventory, scheduling, coordina- practices and style. It also demonstrates how tion, and control in the manufacturing facilities worker involvement in and commitment to the new of private industry. According to one estimate, the technology is crucial to success and how new tech- people working in factory offices make up 10 per- nical systems, far from making traditional work cent of the clerical work force in the United States. skills obsolete, can make certain skills and exper- Clerks take orders for a variety of products, break tise more important than ever before. the products down into their component parts, then The study site is at a medium-sized factory, order parts from a vendor or have them built on known here as the “Aircraft Instruments Plant. ” site. As components wend their way through the At the time of the study, the MRP II system was being implemented. This was both a disadvantage ‘This section is based on research performed for OTA bv I.eslie and an advantage for the case study; the imple- Schneider, Robert Howard, and Frank Emspack, Har\’ard Un~versity, mentation process was observed as it took place.

330 App. B—OTA Case Studies ● 331

But the full impacts are not yet known, although ary” personnel and receive a yearly salary rather participants in the study did speculate on what than an hourly wage, but are members of the union. those impacts will be, There is also a Production Support Office for the This plant is part of the Aerospace Business contributing areas with its own managers, super- Group of a major American corporation. Of a work visors, schedulers, expeditors, and clerks. Finally, force of approximately 1,300, some 500 are man- there are people in the shop itself who interface agerial and professional personnel. The rest are with these production support personnel—pri- production and clerical workers represented by a marily, the shop supervisor, dispatchers, and ~ro local union belonging to a large AFL-CIO interna- analysts. tional. The plant manufactures a wide variety of Many of the senior salaried workers at the Air- high-technology products such as aircraft instru- craft Instruments Plant were hired in the years ments, engine sensors, displays and monitoring immediately following the Second World War and systems, incorporating some 55,000 different parts. because of union seniority rules, are now concen- Much of the work is under contract to the Depart- trated in the highest job classifications, including ment of Defense, and military specifications re- the graded salary positions of the Production Sup- quire high quality, strict cost control, and exten- port Office. Because of the long tenure of many sive documentation and recordkeeping. workers, there has been little incentive to invest in explicit documentation of work procedures and Methodology practices. As this generation retires, the plant risks losing important job skills that have not been The study was based on 75 hours of interviews passed onto younger workers. Systematizing and with approximately 30 employees, conducted in formalizing work practices in order to counter this December 1984 and January 1985, Those inter- loss was a major objective for the automated in- viewed included a broad cross-section of managers, ventory control system, systems designers, supervisors, clerks, shop floor workers, and union officials. However, the study focuses on the experiences of the clerical workers The Old System in the plant ‘‘Production Support’ department, in particular, production planning and control su- For the last 15 years, the Plant used a computerized Inventory Management System ( IMS) run out pervisors, clerks, and expeditors. This study looked not only at the technology, but also at the produc- of a centralized corporate computer center in an- tion planning and control, the general manufac- other city. Keypunched paper orders were batch turing process, the concept and philosophy of processed monthly to break the orders down into MRP, and labor-management relations, component parts. This monthly “profile report” updated all material on hand, on order, and on the floor, Organizational Structure shop and identified shortages. The Produc- tion Planning clerks then put out “order action The plant has five basic product lines: gyro- reports” to Purchasing for outside vendors and scopes, heat sensors, electromechanical sensing to contributing areas for in-house “make” parts. and display devices, electronic sensing and display In general, this process took a month. 1n addition, devices, and flow meters. It also has four “con- documents were generated setting aside parts for tributing areas ’’-machine shop, coil shop, printed the manufacture of particular products and list- circuit boards, and silk screen. These areas supply ing shortages of parts required to fill current cus- the five production areas with parts and compo- tomer orders, Supervisors and expeditors in Pro- nents that are not purchased from outside ven- duction Control followed these orders on the dors. There are seven functional areas—finance, shortage lists into, through, and out of the plant, marketing, purchasing, engineering, manufactur- Other Product Support personnel schedule and co- ing, information systems, and employee relations. ordinate the work of the contributing areas. The first product to go on line with the MRP II The above is a description of the formal produc- system was a gyroscope. The Production Support tion planning and control process. Along with the Office that handles the gyroscope performs two formal rules, a system of informal negotiations was functions–production planning and production necessary to accomplish production goals. The control—and consists of a production support man- process was rife with irregularities and conflict- ager, two supervisors, and five clerks and expedi- ing priorities, some resulting from technical limi- ters. These clerks and expeditors are “graded sal- tations of the IMS system. The once-a-month re- ● Automation of America’s Offices 332 — port quickly became out of date. Accumulated were planned in the production process, systema- inaccuracies were difficult to eliminate. As a re- tizing shop procedures to correspond to the logic sult, Production Support personnel often did not of MRP. The systems designers began writing the know whether the data on the profile report were applications software when the hardware arrived accurate and spent much time tracking down in- in April 1984. accuracies. The plant had a number of parallel rec- The MRP 11 system is an elaborate simulation ordkeeping systems that could not communicate of the gyroscope production work process. Man- with each other and that were often in conflict. agers say that increased access to information is The organization of work also caused irregulari- its greatest benefit. However, the computer is not ties because of the multiplicity of smaller compet- as yet programmed to correspond to the complex- ing suborganizations each with its own managerial ities of the actual work. For example, the system hierarchies, priorities, and goals. In order for these refuses to release orders if there are missing com- various units to work together, considerable in- ponents. Production could begin without those formal negotiation was required, Effectively per- components if the MRP system were programmed forming one’s job might mean doing favors for to handle such exceptions. Much night and week- other departments in hopes of return favors or put- end time that could be used for certain processes ting pressure on someone, but not so much pres- is lost because the system is closed down. Since sure as to make an enemy. This kind of informal there is no easy way to record a product moving negotiation served to smooth the production proc- backward in the assembly process for “reworking,” ess and iron out conflicts, but the inefficiencies which happens frequently with such a complex were obvious and their elimination was one of the product, the MRP often does not know where the goals of the new system. product is. The problems in the gyroscope division during Implementing the System the first weeks of implementation had to do with rigidities created by the shift from an informal pro- While the managers recognize that organiza- duction planning and control system to a highly tional issues and workers’ attitudes are the key formal system. With the MRP system, each time to the ultimate success of the new system, the ten- one level of assembly for a product is completed, dency has been to concentrate on the narrow tech- the new subassembly goes back to the locked stock- nical details of getting the system installed; or- room, where its new status is fed into the com- ganizational issues have been left for later, and puter. There is no general floor stock; every single often either ignored or mishandled. component is accounted for, “mortgaged” to a When the plan for an MRP II system was ap- specific order number and under strict control. proved in 1983, a Core Team was created to select However, amidst the pressures of preparing the a vendor and oversee implementation. The Core gyroscope division for implementation of MRP, Team had representatives from all major functional cataloging general purpose floor stock received areas but the two organizations most directly con- a low priority. When the newly functioning MRP cerned with employee attitudes—Employee Rela- II system began releasing its first components tions and the local union–played only a marginal many of these parts (yet to be entered into the role. In order to justify the major investment, the computer or even properly organized in the stock- Core Team had to produce a cost/benefit study. room) were left out. In addition, supervisors were Estimating the costs of the new system was rela- still responsible during implementation for meet- tively straightforward-one-time purchasing costs ing their normal monthly production quotas, an plus yearly maintenance and servicing fees and la- impossible situation for them. bor costs.’ The benefits were considerably more difficult to estimate. These would include savings Employment Impacts on labor costs, control over data processing operations, reducing inventory, and speeding up the In order to justify this major investment, the movement of inventory. Core Team produced a cost/benefit study. The team The implementation began with an intensive re- projected that one-tenth of the plant’s total work view of the gyroscope production process. Changes force (130) people could be laid off over a 5-year period. With attrition, the overall reduction could approach nearly 20 percent of the current work ‘The team estimated the MRP 1 I would cost $2 million for the ini- force. These potential savings have not occurred tial investment (80 percent was for hardware) and $1.7 million in expenses over 3 years. Maintenance and service would amount to $600,000; as yet but are expected when the system is operat- the remainder would be training and labor costs. ing more smoothly. App. B—OTA Case Studies 333

Job Content, Skills This position formerly involved planning; ordering materials; sending it out to the shop floor; and The problems experienced during the implemen- seeing that it was properly machined, inspected, tation illustrate that instead of eliminating the and put back into stock. The more accurate and need for traditional product knowledge, MRP up-to-date information provided by MRP makes makes that knowledge more necessary, to ensure it unnecessary for the production control clerk to that the MRP simulation is as accurate as possi- spend a great deal of time on the shop floor. Many ble. Supervisors have to have sufficient familiar- of their traditional tasks have disappeared—some ity with the product to know when to ask that the into the computer system, others taken over by MRP system be manually altered. Product knowl- the new supervisors in the Production Support Of- edge is especially important for the supervisors fice and by shop coordinators. What is left are cler- of Production Planning and Control, the people ical tasks that are repetitious and, some say, with the authority to manually release orders. This pointless. shift of authority from the shop floor to the Pro- When graded salary personnel work with the new duction Support Office has led some production system, it is usually at their supervisors’ discre- employees to see MRP as a threat to their own tion and only to perform the lowest level clerical control, exacerbated by their perception that the tasks. The managers claim that this is temporary people in Production Support do not know how and that eventually some additional tasks will be to perform their job effectively. delegated to graded salary personnel. The union, Knowledge of the system is also necessary for however, sees this division of labor between su- effective use of the MRP. Production Support per- pervisory and union personnel as a contradiction sonnel need to know how and when to perform end- of the work organization model presented by the runs around the system. For example, parts for management. This change in the balance of respon- a specific order are released in lots of ten. If only sibilities puts the union workers most at risk if eight parts of a component are available, the sys- the predicted labor savings are achieved. tem will not release the order until two more arrive. The current lot size must be manually changed Training to 8 and the next lot size to 10 in order to begin production. From the beginning, the MRP training process The system has substantially increased the time encountered serious problems. The Core Team’s that Production Support personnel spend actually recommendation that a manager be hired and given working at computer terminals, by as much as 300 full-time responsibility for training on the MRP percent; they enter their own data, gather infor- project was rejected by top management as too mation and perform transactions (e. g., releasing costly, Preoccupation with getting the system parts onto the shop floor). The need for accuracy working resulted in the neglect of training. On the in data entry becomes very important. This, and surface, the quantity of training provided to the need to identify and handle exceptions demand managers and workers seemed considerable. Some constant alertness and can be extremely stress- managers, supervisors, and hourly personnel at- ful. In addition, there are not enough terminals tended a week-long MRP training course at the to handle the work to be done and lighting and nearby factory of the system vendor. The training other environmental conditions are poor. for most of the affected work force was a 10-week, The management is operating under two basic 40-hour, in-plant course developed by the Core assumptions—that MRP II will require signifi- Team and the Information Systems Department, cantly fewer people to oversee production planning which proved far from adequate. Some key work- and control and that because of the centrality of ers did not receive training until well after MRP MRP to the plant organization, those people who was implemented. The vendor training course was work on the system must be management person- criticized, especially the videotapes, as boring and nel. Many of the new supervisors occupying newly a waste of time. Workers were not taught how to created positions are young with almost no experi- use the paperwork that comes out of the system, ence in production planning and control. They have and did not understand the logic of the system. often confronted problems that they do not have Managers believed that workers did not under- the expertise to handle. Unofficially, some experi- stand what production control itself was. Work- enced employees are still performing the tasks. ers from the Production Support Department One example of shifting work roles is that of the tended to see things differently. They felt they production control clerk in the contributing areas. understood how the work process really func- 334 ● Automation of America’s Offices

tioned, but were being asked to learn a highly lead to positive outcomes for both employees and formalized system radically different from for the organizations, if that is a priority in the what was actually happening. planning and implementation process. The superficial training has come back to The research site is the national corporate head- haunt the Core Team. The system designers quarters for Company XYZ, a major manufacturer have had to play a support role that takes val- of a consumer product. In addition to the head- uable resources and time away from implemen- quarters office, the company includes four manu- tation of the MRP system in new product lines. facturing plants located throughout the country. There are approximately 300 employees in the cor- Conclusions porate headquarters and approximately 1,000 employees overall. The company is a wholly owned The final organization of work within the MRP subsidiary of a larger corporation. The study fo- II system is not yet determined. It is still too early cused on four departments within the corporate to know whether a work organization based on a headquarters-marketing research, planning, the small group of relatively young, new supervisors controller’s office, and product development. can effectively oversee production planning and Only one of the four manufacturing plants is control at the plant. The promise of increased deci- unionized, the pay is high compared to similar sionmaking for graded salary workers has so far companies, and there is a high degree of career mo- remained unfulfilled, because of managerial deci- bility in this company. The company literature sions about how technology is used. There may stresses the importance of treating employees well be a conflict to management as to whether to en- and giving them the freedom, opportunity, and re- trust responsibility for working the system to bar- wards to perform effectively. A second theme is gaining unit workers or to reserve it within man- the importance of open communications. Produc- agement. tivity is viewed in terms of a total system, em- This case study illustrates the fact that techno- bracing employees, equipment, information and logical change is a social process, in which organiza- materials. There is a strong emphasis on innova- tional choices that shape not only the effects on tion, risk taking and experimentation, and state- people and organizations but the effectiveness of of-the-art knowledge and technology. There is also, the technology itself. Managerial choices were a peculiarly, a strong emphasis on punctuality, with major obstacle to the successful implementation all employees, including the president, clocking in of MRP II; and as MRP 1I was put into operation, every morning. Bonuses are linked to both sales management did not address a variety of sharp volume and return on assets, providing an obvi- contradictions between the new system and tradi- ous incentive for improved performance for the tional work practices, job categories, and plant in- company as well as for the individual salaried em- centive systems. ployees. The management staff feel that these problems It is clear from interviews and personnel data, will be resolved in time. The problems are not company brochures and policies, that the corporate unique, but represent some of the most common headquarters work force is highly educated, well- problems that organizations experience when im- paid, and largely professional. Except for its for- plementing new office technologies. Their resolu- malistic policies on punctuality, the company close- tion depends far less on narrow technical factors ly resembles the “organic” (i.e., nonmechanistic) than on the social processes by which technologi- model of organizations that management theorists cal change is managed and negotiated. have touted for years. Office Automation in the Corporate Methodology Headquarters of a Consumer Product Manufacturer Semistructured interviews were supplemented by researchers’ informal observations and archival Introduction and Background information. Interview data were collected from—2 executive managers, 1 manager from personnel, This is a case study of the successful implemen- 3 managers from technical departments, 2 key peo- tation of an office automation system. It suggests ple involved in the implementation process, 4 de- that choices in managing technological change can partment headsf 8 individuals outside the focal - ‘This section is based on research performed for OTA by Tora 13ik- work groups who ‘were links in the process and 20 son, Don Man kin, and Cathleen Stasz of The Rand Corp. employees from focal departments, Where possi- App. B—OTA Case Studies ● 335 ble, respondents were selected for participation on pation and technical expertise in the planning. A the basis of formal position in the organization direct knowledge of business tasks was critical. chart. Others were identified during the data-col- On the other hand, comparing technologies and lection process. assessing their ability to handle the needs required The interview format used with all respondents computer system professionals. required 1 to 2 hours to complete. Field notes taken The year-long planning effort yielded an ap- during research visits were used to construct case proved plan and those who developed it were reports for each department and for organizational charged with its implementation. Executive man- personnel; these then became the basis for subse- agement was highly committed and provided solid quent examination, Preliminary research findings budgetary support that was apportioned as were reported to the participants in feedback semi- follows: nars in order to confirm descriptive information, ● 10 percent—hardware, vaIidate conclusions, and generate discussion of ● 10 percent—software, issues this organization faces as the technological ● 30 percent—software development, modifi- innovation continues. cation, ● 40 percent—implementation, and Implementation 10 percent–training. The process operated on a project-by-project ba- In 1980, Company XYZ acquired a new chief ex- sis, with the plan partitioned into relatively inde- ecutive officer who saw a critical role for informa- pendent parts. Each project required its own spe- tion systems which permit a business to collect, cific plan and justification. The plan established store, structure, share, and manipulate informa- a very general blueprint and performance criteria tion about previous experiences in order to learn for system development but was indeterminate from them and improve business performance. with respect to order of projects and details of their The segment of the consumer product industry enactment. Projects originate either from user in which XYZ operates is highly competitive, with groups or from the technical consultant percep- many strong players. In 1980, XYZ, holding fourth tion of a need. The consulting firm operates a cen- place among its competitors, was facing major tralized computing facility, the use of which pro- profit-and-loss difficulties; it needed to increase vides this mid-size firm with more computing market share and cut costs. This impetus led to resources than it could support on its own. an investment in computer technology. The goal The major architectures include a remote main- was to replace old batch-oriented information sys- frame owned by the consultant firm, another large tems and manual technology with flexible cutting- computer system on which time is rented, and a edge electronic tools and concurrently, according small number of personal computers. The acquisi- to management, to give users a renewed sense of tion of personal computers at this point is un- power, insight, and enthusiasm about their tasks. systematic and there is no formal responsibility A high-level organizational manager (now a Vice for their support. They are purchased by employee President) was named to lead the planning effort request. Although the company does not want to and put together an implementation team. He discourage personal computer use, there are con- chose employees who had substantial business ex- cerns about data security. Only a few people have perience and a strong sense of strategy, and who, more than read-only access to corporate databases. like himself, were not systems professionals but Analysts can download data from the larger sys- were comfortable with information technology. In tems and upload data that they have entered on- addition, he recruited for the team an employee site. There are a variety of systems available for from another firm with recent systems implemen- use through time-sharing that provide several pro- tation experience. The five-person team produced gramming languages (including a variety of appli- a business systems plan by first studying the work cations software and a fairly high-level matrix- of the firm’s many departments to determine what structured language suitable for flexible data ma- information needs they had; this task required sub- nipulation, analysis, and reporting). stantial input from department employees. Then In addition to these major applications, word the team investigated the kinds of technology that processing is handled by a small centralized de- might fill these needs, relying heavily on technical partment doing internal and external correspon- advice from an outside consulting firm. dence for various departments. Electronic mail is Looking back, the former head of the team em- used primarily for external communications to sub- phasizes the importance both of employee partici- sidiary companies. For a variety of reasons, it has 336 Automation of America Offices .

not been fully implemented within XYZ—draw- ample, some vital procedures requiring nearly a backs were found in two systems pilot-tested, most day when done manually now require only 1 hour employees do not have their own terminals, and and are less likely to contain errors. Most employ- it is seen as hindering personal communications, ees use the time gained to take on new tasks and which is an essential element of XYZ’s corporate responsibilities. On occasion, groups have also wid- culture. The company does, however, use Voice ened or redefined their missions as a result of com- Mail Exchange (VMX) to better manage telephone puter use. In terms of bottom-line measures, XYZ communications. Primary VMX communication has succeeded in increasing its market share and occurs between sales representatives in the field cutting total costs per unit output, even though and the Sales Planning department in the home labor costs are higher. office. Reported changes in work were generally consistent across all groups. There was increased con- The Users trol over work. Work demands increased for some and decreased for others, depending on the work On average, employees had been using com- group. Rather than create repetitive data-entry puters for at least 3 years at the time of the inter- jobs, the company chose to distribute database views. Across the four departments, five employ- updating tasks among the employees using the ees had their own workstations; the remainder databases. This has caused some dissatisfaction, shared workstations with two or more others, and There were two important between-group differ- often found getting computer time to be a prob- ences. One was a change in management style in lem. In most departments workstation allocation one department-a manager apparently was spend- reflected task demands. In one department, how- ing most of his time on-line and less time in typical ever, status was also a factor. Actual time spent management activities. Opinion was mixed as to working on the computer was extremely variable whether this change was good or bad. Another across the four groups. Since few people use the difference was the degree to which users had in- computer all day, it seems reasonable that work- vented new ways of doing their work. Many re- stations be shared, but the tradeoff of cost v. ac- ported that they adapted or modified the technol- cess has not been wholly resolved, ogy to suit their needs, although most of what they The users in most departments have a range of reported was more appropriately categorized as options for guiding and modifying the systems a new task. they employ. There is considerable choice about Most changes in communications resulted from how to use the advanced tools, left largely to user tool sharing and interactions with others in the initiative. Some employees envision a split between department, rather than increased communication “haves” and “have nets, ” based on differential ap- with people outside their department. Few employ- titude for information technology. ees used computer-based communications, and no Users across the four departments were gener- one reported that this took the place of other forms ally enthusiastic about the capabilities of the com- of communication. Because of the strong empha- puter systems, although some had specific complaints sis on face-to-face interaction, many believe that such as poor graphics capability and difficulty electronic communications systems are unneces- moving between databases. Other complaints con- sary and possibly detrimental to intraorganiza- cerned the databases themselves—the data were tional behavior. sometimes inaccurate or unavailable. The disad- Formal job changes were reported in three of vantages cited by users have more to do with lack the four groups, but only at the clerk level. Two of systems integration than with individual sys- clerks believed their recent promotions and pay tems. The integration problem had been expected increases were due to increased responsibilities and as more applications were implemented and ac- special assignments resulting from their computer cessed by users. use. The clerks’ job descriptions in one department were being updated at the time of the interview, Job Content, Skills explicitly because of the new computer-related higher level skills and responsibilities. The clerk No trends were observed toward mechanization position in another department has now been up- of work or toward de-skilling of jobs. Most users graded from an hourly to an exempt one. reported increased variety, challenge, creativity, While the majority of users found satisfaction and responsibility. Time savings were universally and a sense of accomplishment, others were bored, reported for individuals and for groups. For ex- less motivated, and working below their abilities. App. B—OTA Case Studies . 337

Among the reasons cited were increased expecta- ogy is mission focused, user driven, and can be tions about what the technology could do and, guided, modified, and manipulated by users. It is therefore, frustration when expectations were not designed for change as users acquire greater ex- met. Another user felt “locked to the terminal” pertise. The organization had a conscious strat- when trying to meet end-of-period or other deadlines. egy for implementation that had been carefully planned, staffed, and budgeted, They attempted Training to balance centralized and decentralized decisionmaking. The implementation project was charac- Despite the fact that training was a mixed-bag terized by a great deal of user involvement that of formal and ad hoc procedures, most users were promoted a feeling of “ownership” among employ- well satisfied with it. For most employees, learn- ees. The system continues to change and individ- ing about the computer system is part of doing uals keep finding new ways of working with it. the job. Learning beyond the minimum required There is no “post implementation” period. Rather for this purpose is voluntary. than minimizing the change, the organization has Training varies by department. In R&D, the learned to manage it. tasks are so specialized that general purpose introductory and intermediate courses are of little help, so training proceeds on an individual basis Computer-Mediated Work in with the help of peers. Peer learning also charac- Commercial Banking4 terized the Planning Department, where only one person uses the system. Formal classes are offered Introduction and Background by the system vendor. The consultant firm and The influences that affect the implementation the Business Systems Department both provide of automated office systems can be environmental training and technical support for users on major or institutional. In this study of the automation mainframe applications. The amount of time re- of one group in the international department of quired for users to learn their systems varied widely a major Commercial Bank, the original reasons for by department. In R&D it took 2 to 3 months; in deciding to implement the system were environ- Planning, some applications could be used in just mental-the desire to improve world-wide commu- a few days; sales forecasting took about 6 months nications in the International Department (ID) and to master. to become more competitive by offering more or Users mentioned a variety of formal help mech- better services. The factors that contributed to the anisms, including documentation, local technical success of the implementation were institutional, staff, a telephone hot-line, a users’ group, and on- the most important being the visible and unwaver- line help. Some means of assistance, however, were ing support of top management. Key actors were not entirely reliable. Employees had problems find- involved from the beginning and provided their ing some of the manuals they needed, and some backing. Users were involved in the feasibility applications were not well documented. study and in the actual implementation. Informal support was crucial to most users. The These factors, while critical, are not sufficient learner must find someone who is willing and able for success. If unwise technical decisions are made to teach and then find a time when they are both or based on inaccurate technical information, the free. Self-taught “experts” among the employees implementation is likely to be compromised. While performed voluntary support service. While they it is felt at Commercial Bank that the original im- seemed to enjoy the teaching role, they believe that plementation was a success, there have been some learning support could be more effectively provided problems. For example, they were not able to “close if some resources within the department were for- more deals, which was one of the goals; the num- mally allocated for that purpose. A resource cen- ber of functions available on the system was re- ter was one suggestion. duced after the pilot project was completed to reduce costs; communications, especially overseas, Conclusions have been a problem because of low-speed lines In Company XYZ, a conscious attempt was and lack of sufficient equipment; and at certain made not only to remove the constraints on inno- times, the system is heavily loaded which affects vation, but to encourage it. They view computers performance and user satisfaction. as tools needed by competent and motivated peo- ‘This section is based on research performed for ()’I’.\ h} ,Jon ple to perform their jobs effectively. The technol- Turner, New York Llniversity, 338 ● Automation of America’s Offices —

Commercial Bank has over $40 billion in total Information System (01S) was then planned. It assets and employs some 8,000 people, worldwide. was intended to be integrated, providing a variety Since 1977, equity has grown by more than $1 bil- of functions, for example, electronic mail, coupled lion, largely through high earnings performance with text editing to deliver information directly achieved by taking advantage of capital market to people in the field. opportunities. The concern over controlling expenses meant There has been an intense effort to control nonin- that the pilot had to be tied to clear-cut goals. It terest expense. Over the past 6 years, operating was to be a means for increasing revenue and a expense has increased at an average annual rate catalyst for behavioral change, to improve com- of 11 percent, compared to 16 percent for a communications, and to be financially justifiable in posite of the nine largest U.S. commercial banks. terms of cost savings. Specific goals in customer Several tactics have put downward pressure on service were same day response to 30 percent of expenses, among them, the application of technol- customer Money Transfer Inquiries from field loca- ogy in labor intensive areas and internal expense tions and elimination of all routine customer in- budgeting. quiries from the field to the New York division The International Department (ID) is one of Customer Service Officer. Other goals included three groups that make up the banking function. building a database to assist in identifying cus- As part of the ID, the Asia/Pacific Group, which tomer needs, developing and monitoring market was the focus of this study, provides commercial plans, and permitting broader product require- banking services and has well over 60 percent of ments’ assessments across units. Finally, the 01S its staff located in field offices in Asia and the Far pilot test was to reduce the amount of time mar- East. keting personnel spent on administrative matters Most of the 800 information systems personnel by 15 percent, eliminate 25 percent of the problem in the bank were part of the Technology Depart- solving workload of the New York based Customer ment (TD), which developed and maintained most Service Officer (permitting more time to be spent of the bank’s computer application systems and in customer contact) and reduce secretarial workload. ran the data centers. TD was the builder of large, Planning for 01S began in the spring of 1982. transaction processing systems and was viewed Equipment was installed in New York during the by many as being slow and not responsive. summer and in the field during the winter of 1983. Almost all of the Asia/Pacific Group’s commu- Evaluation continued into the beginning of 1984. nication, among the field offices and between the An employee was hired to implement the 01S New York and field offices, took place over an in- who had experience in implementing a similar sys- ternational TELEX System, because of the need tem for another financial institution. The bank also for a hard copy record of the communication on retained a consultant. A two-stage pilot test gave both ends and because time differences restricted ample opportunist y to debug and configure the sys- the time available for telephone conversations dur- tem. A member of the Asia/Pacific Group was the ing the normal business day. Long (15-20 page) full-time user representative on the implementa- loan proposals had to be sent between Tokyo, Hong tion team. Kong, New York, and London several times dur- Equipment.- The 01S included word processing, ing their preparation. Preparation of TELEX mes- electronic mail, document processing, desk man- sages was time consuming for the principal and agement with calendar, and calculation abilities, the secretary, inefficient, and error prone. It dis- and forms development in one integrated package. couraged sending messages. The system is connected to a time sharing system The possibility of using computer and commu- and to the bank’s mainframe computers. A 72 line nication technologies to overcome the communi- statistical multiplexer (STAT MUX) tied to a cations problem in ID was of interest to the head microwave link is used to connect the equipment of the Asia/Pacific Group, who realized that poor between New York City offices. Terminal trans- communications was compromising his people’s mission speeds are 9,600 baud at the headquar- performance and his ability to control them. ters office, 2,400 baud at another NYC location, and 1,200 baud on the overseas and dial-up links. Implementation The system can access the time sharing system, Initially it was thought that communicating transactions for each customer, commercial loans, word processors in each location could handle the historical records, financial asset inventories, and job, but this approach was too limited. The Office all other banking databases. App. B—OTA Case Studies ● 339

Methodology system where they execute analytic procedures and route the output back to the terminal or printer. This study focused on the individual worker, al- A spread-sheet function is used for preparing plans though some conclusions were drawn about work and can be downloaded to a personal computer and group, departmental, and organizational processes, back into OIS. Semistructured interviews, memoranda, and observation were the primary method of data gathering. Respondents were selected from all levels of Job Content and Productivity the department studied, ranging from clerical to The content of secretaries’ jobs has clearly im- department head, based on the participation in the implementation and on their position in the orga- proved. Previously, up to 40 TELEXs per day nization. For purposes of verification, at least two would be sent, which meant spending 2 to 3 hours in a TELEX room and many more hours in prep- subjects were selected from each work group and from each organizational role. They included work- aration. Now principals send most of their own ers who had been in the field at the time of imple- messages. Because not all offices have 01S, some mentation. TELEXS are still sent, but this is much easier with An open ended interview selection process was the 01S. The secretaries’ typing load has been re- used, adding personnel to the list as their roles duced and now consists mainly of larger manu- were identified. The senior personnel were inter- scripts. This has freed them for other activities that includes some customer contact and some reviewed last to permit the identification of critical policy issues. search. The word processing software helps them to create more “professional” looking work. Some The Users secretaries feel that the total amount of paper has decreased; however, many principals do not agree One of the goals of the system designers was with this. that everyone would prepare, send, and receive The secretaries feel that they have acquired new their own messages. Officers would read their mail skills and that they are more productive. New ca- first thing in the morning and prepare their own reer paths have opened up for some secretaries who replies. They may check the system 3 to 4 times showed unusual interest in or skill with the sys- additionally during the day. The system is used tem. Some were promoted to system “expert,” pro- heavily by personnel when traveling to field loca- viding consultation and teaching to others in the tions. However, the lack of enough terminals in group. Some were transferred to the Information overseas offices limits access to the system. The Management Systems group where they are pur- speed of the lines and the need for certain opera- suing a systems career. Management appears not tions offices in New York to be open in order to to have anticipated the change in work mix for use on-line files also restricts the usefulness in the the secretaries. Each secretary has been left on field offices. his/her own to work this out. Secretaries make extensive use of word process- Some managers feel that the system helps them ing and electronic mail. Large documents are pre- establish priorities in their work or that they are pared off-line, proofed, corrected, and then trans- more aware of what is going on in overseas offices. mitted over 0IS. The low-speed lines restrict use Because information is easier to transmit, more of the system interactively. is sent. Principals feel more productive because In New York, most employees in Asia/Pacific the number of telephone calls and memos has de- have their own terminals which, along with the creased, messages sent on the system tend to be higher speed lines, encourages use. Employees do brief, there is less time wasted in telephone tag, much of their own document preparation. Officers and more reports are distributed over the system. and support staff make extensive use of the con- The Monthly Profitability System used in plan- nections to other systems, directly accessing the ning, formerly took several days to distribute, Now Money Transfer, Cash Connector, and Historical it is distributed instantly by electronic mail. Al- Research systems. An active officer in New York though more useful information is being commu- might be continuously logged in to the system, nicated, the number of trivial messages has also receiving 10-15 messages per day and transmit- increased, Communications tend to be among peers ting 7-10. Meetings may take place around a ter- rather than flowing up and down the hierarchy. minal while scrolling through a document or list. For certain people, the system has served as an Some officers use 0IS to access the time sharing excuse not to get out into the field. There is some 340 Automation of America’s Offices concern that management will see everything Conclusions through the machine and will not benefit from ex- Employees at Commercial Bank feel that there posure to the field offices and customers. has been an increase in individual productivity and In times of great pressure or emergency, work- more communication with customers. Although ers at Commercial Bank tend to revert to their old this improvement is difficult to quantify, a 1 day methods of doing work. They pick up the phone turn-around on approvals for certain proposals has to relay messages or they may not read their elec- made the bank more responsive to customers. Mar- tronic mail for several days. keting personnel have not reduced the time they The effectiveness of the organization as a whole spend on administrative matters and Customer seems to have increased because of the increased Service Officers still handle most of the contact access to the various databases such as historical with the field. In the New York offices, the num- records and customer transactions. ber of secretaries has decreased from 11 to 7. La- bor savings figures were not available for the field Training offices. The original concept for training was one-on-one 01S will not be fully cost justified on the basis training. Often an on-site person in each office was of electronic mail alone. One of the most impor- designated as the “expert” in that office, received tant benefits of the system is access to the vari- special training, and became a “friendly’ source ous application systems such as money transfer, of information. While there was some “cultural” commercial loan, and collections. The full poten- resistance to using the system in the field at the tial has not yet been realized. The use of leased more senior levels, this was a short-term phenome- lines and satellite communications could increase non and disappeared when the “boss’ began using bandwidth and make the system much more usa- it. ble in the field. Local processors in major regions Special care was taken to have documentation would reduce traffic on the relatively slow trans- prepared and to provide training sessions on the oceanic links. The real payoffs will occur when the equipment. The training was staggered to accom- system is used as a single interface to all written modate new users over time. A good portion of material and this has not yet occurred, possibly the staff were trained by their colleagues, rather because of the costs involved, This is an example than in the formal training sessions. The simplic- of the conflict between controlling operating ex- ity of the system and its self-help features made penses and taking advantage of office automation it easy for many of the staff to learn on their own. to improve operations.

Organization Development, Implementation, and Although there have been no major changes in Impact of Office Automation at the structure or social support, the system has facili- Office of the United States Trade tated social interaction among levels. Since the sec- Representative retaries were the first trained on the system, they later aided in teaching senior officers. This served Introduction and Background to break down social barriers between levels, particularly in the field offices. Office automation at the Office of the United The system also permits more time/place flexi- States Trade Representative (USTR) has estab- bility in performing work as managers can do their lished extensive system capabilities in a relatively work from home or hotel rooms and do not have small agency with wide ranging policy responsi- to spend as much time on the telephone. Formerly, bilities. The ratio of terminals to employees is all information was sent to New York for entry almost one-to-two, an achievement that is not com- into the systems. Some of the data entry is now mon at this early stage of development. done in the field, which better distributes the work- This case study reviews the brief 25-year his- load and makes the system more current. Also, tory of the office, its role in international trade field personnel communicate directly with operations to resolve some problems rather than going “This section based on research performed for ()’I’A by J$rilliam Neu- through the Customer Service Officer in New York. feld, consultant, Washington, DC. App, B—OTA Case Studies ● 341 policy, early efforts to automate a number of func- was working and in 1984, it was renamed, Trade tions to aid in carrying out its responsibilities, and Policy Staff Committee (TPSC) TradeNet. Office how these early efforts served as the beginning automation followed development of the large of the present automation system. system. USTR is a small agency with a permanent staff of 122 in 1984 and a total staff including contrac- Methodology tors and part-time personnel of 183. Assisting the Personal interviews were conducted with 37 peo- USTR with his responsibilities for trade negotia- ple, including 10 senior staff, 15 professional staff, tions are three Deputy U.S. Trade Representatives and 13 secretarial staff members. (Secretarial staff who also hold the rank of ambassador, two in at the agency currently number 46, including 3 con- Washington and one in Geneva, Switzerland. There fidential secretaries.) Four of the ten senior staff are also assistant representatives in trade policy, interviewed had terminals on their desks; the oth- industrial and energy policy, international invest- ers did not have direct access to computer termi- ment policy, agriculture and commodities, General nals. All but three of the professionals interviewed Agreement on Trade and Tariffs (GATT) affairs, had computer terminals at their desks. and for several specific areas of the world. Terminals had been available to most of those Three events contributed significantly to devel- interviewed for 1.5 to 2 years. Few USTR staff opment of office automation—commitment by the used the system directly before that. Office auto- United States to a new round of multilateral nego- mation is a recent development, and work patterns, tiations and the need for a method to handle large habits, expectations, and performance are still volumes of trade data and material, the failure of changing. In spite of this it was difficult for some the Department of Commerce to assume a leading respondents to recall how they worked previously, role in the creation of a centralized trade database, and conversely, difficult for senior staff to notice and the introduction of microcomputers into the significant change because they have not partici- workplace. Computer technology suggested to pated as fully. USTR that a database could be developed specifically for international trade, from data that ex- Implementation isted in files of many different agencies with responsibility or interest in international trade. A The computerized trade database has become consolidated base of accurate information was a major component of the tools used at USTR and greatly needed. was the forerunner of the office automation sys- Initial efforts by USTR to centralize trade data tem that eventually developed. The interagency used contracted computer and programming time. trade database and some additional electronic ca- A plan was outlined utilizing the hardware and pabilities evolved over the course of 15 years. In- programming capability of the Central Intelligence troduction of a more fully integrated and compre- Agency (CIA), including the development of com- hensive office automation system took place in only munications capability between the USTR Wash- 5 years. ington and Geneva offices by high-speed data link. There was as much planning and consideration The program was eventually transferred to the De- on the part of the Computer Group and senior man- partment of Commerce computer facility and to agement as time and budget allowed. The first fea- a computer system at the National Institutes of tures to be developed were systems for sending Health. messages between offices electronically and for In 1977, USTR formally proposed development keeping track of incoming mail to assure timely of a centralized computer system for the trade com- response. This system, although not unique, was munity to eliminate duplication of effort. It would ahead of many other such programs in government. require each agency to contribute data to an infor- Since most of the agencies participating in the mation pool. A major goal was to give trade profes- shared data network had some terminals allowing sionals direct access via computer terminals to the direct access to the computer facility, an electronic data. The system became known as the Trade Pol- mail system was introduced in 1980 using the ex- icy Information System (TPIS). The NIH, Divi- isting elements of the TradeNet system. It allows sion of Computer Research and Technology was users to send and receive messages and completed chosen as the main computer support facility be- documents, and enables members of the Trade Pol- cause many agencies already used the system and icy Staff Committees to transmit unclassified it was cost effective. By 1979, the data system documents. The system serves nine agencies, in- 342 Automation of America’s Offices —

eluding the Office of Management and Budget; including maintenance and updating of the sys- Departments of Agriculture, Commerce, Interior, tems, updating training manuals, and preparing Justice, Labor, State, and Treasury; and the In- the daily newsclip service. ternational Trade Commission. A telemail system A vendor provided training for secretarial staff is available for communication 24 hours per day members after acquisition of 18 microcomputers between Washington, Geneva, USTR Ambassa- in late 1983. Training by outside sources of both dors, and staff members on travel. It is also possi- professional and secretarial staff was cited often ble to use this system to transfer documents into as one of the least attractive experiences with the word processing systems in Washington and USTR automation thus far. All found it to be un- Geneva. satisfactory because of the use of ‘‘computer lan- USTR had only begun to purchase terminals for guage” to describe operations and lack of expla- those outside the computer operations group in nation of technical details. The agency has found 1980 and electronic mail was not available to all it more satisfactory to use in-house staff for train- staff. To use the electronic mail or database sys- ing because it is more useful to the employees and tems, it was necessary to use one of the few termi- because it is more cost effective. nals available through the computer operations As the agency and the system grew, computer group. To encourage users to sign on to the sys- operations personnel were engaged almost full time tem frequently despite the inconvenience, a calen- in system construction, maintenance, and respond- dar was published electronically of daily meetings ing to requests for assistance, leaving little time and events held at USTR. The International Trade for organized training. A “control desk” has been Commission added a calendar showing trade deci- recently established to assure that someone is sions being considered by the Commission each available to answer questions or help solve prob- week. A system designed to keep track of the in- lems, releasing the Computer Group staff for other creasingly large amount of correspondence directed tasks including advanced training sessions. to the agency was developed at the same time. By 1980, the agency had acquired a computer Job Content, Skills to do data manipulations and communicate with About one-half of the senior staff, including the the NIH system, and a minicomputer with capa- agency’s top official, uses the terminal in their of- bility of supporting 128 users. A needs study rec- fice infrequently. The reasons most, often cited are ommended that the ultimate configuration be a combination of stand-alone units and shared logic that they do little creation and revision of docu- terminals that would use the same software, be ments or data retrieval and analysis. Because the agency is so small, use of the calendar function linked through telecommunications, could access is not crucial. They do not use electronic mail in- electronic mail and files, and could share common resources such as printers. Terminals were placed ternally or between agencies because either they in only a few offices at first, but as professionals or their counterparts in other agencies do not have terminals available. They do not use the word proc- gained experience using the system, others asked essing capabilities, preferring to rely on their subor- for terminals. By the end of 1983, more than 50 dinates to produce required documents or data on terminals had been installed. All secretarial staff request. They use the telephone or short memos will eventually receive stand-alone machines. There and letters to conduct business. Negotiating trade were 36 more microcomputers on order at the time issues, or discussing policy options, duties primar- of this study. ily reserved for senior staff, requires face-to-face contact with counterparts in other countries or Training government agencies. “Diplomatic niceties” would Organized training activities for users of the preclude the use of teleconferencing technology for trade data system expanded in 1981. A USTR Com- conducting trade talks or other negotiations. As puter Users Manual was issued. Formal group a result of not having a need to use a terminal, training and orientation sessions were held. Indi- half of the senior staff interviewed expressed some vidual training sessions and ongoing technical reluctance about learning to operate the equipment. assistance was provided on demand to new users. The opposite was true of most professional staff. A staff of six “information counselors” was hired They use their terminals frequently. In the absence within the Computer Group. Additionally, six part- of time or opportunity to participate in formal time student workers were added to assist with training sessions, all said they learned the most the increasing workload of the Computer Group, about how the system worked by “playing with App, B—OTA Case Studies ● 343

it. ” Each interviewee suggested that it had taken and better databases have contributed greatly to some time to become comfortable with the idea effectiveness in carrying out this mission. of typing rather than writing, or with the techni- Increased productivity at the professional level cal aspects of the equipment. was achieved by the use of the electronic mail sys- Most professionals described increased self suffi- tem. The ability to send and receive documents ciency in document production as the greatest time by electronic mail has improved the process of com- saving, as well as adding greater satisfaction to ment and clearance. The time for review and clear- the job. Without the need to rely on secretarial ance of trade policy positions and papers had been support to do drafts, rewrites, or make copies, the cut in half in some cases. process became not only faster but less stressful, Professionals felt that they could get their work Secretaries commented that they believed there done much faster, which allowed them to clear up was less anxiety on the part of professionals, who backlogs, Without exception, respondents described used to wait for typing, and less stress on secre- a decrease in real time of 50 percent in completion taries as a result. of projects. Professionals noticed that deadlines on occasion had moved up as the ability to meet them had im- Organization proved. Senior staff said that they had become more conscious of time saved, and as a result, de- As yet it is impossible to relate hierarchical or- layed making assignments knowing their staff ganizational changes within USTR to the intro- members were able to meet shorter deadlines. duction of office automation, No major organi- Professionals described significant changes in in- zational changes have taken place since 1979. dividual writing style; word processing capability However, a number of established office relation- enables them to spend more time thinking about ships have been affected, especially between profes- their subject. Senior staff, again without excep- sional and secretarial staff members, As many tion, suggested they were more likely to send a professionals become adept at performing their document back to correct small errors or to add own word processing, some secretarial staff have clarification because they knew it would take much begun devoting more of their time to other work less time with the automated equipment. while others have become dissatisfied with their Several professional and secretarial staff mem- jobs and the lack of challenge. bers were more satisfied with their jobs because The increased knowledge and contact with others automation let them do their work better. Some in the trade community may change the career ex- secretaries performed more typing in the same pectations of the junior staff. When senior staff amount of time; others spent less time typing the become more familiar with the potential of the sys- same amount of work. Some were dissatisfied be- tem, they may assume more direct responsibility cause the job was uninteresting, especially those for day-to-day conduct of operations. whose workload had been drastically reduced. In a few instances, secretaries had been able to take Conclusions on new responsibilities such as research and writing. If that becomes general, the secretarial staff The agency has a better understanding of issues may seek increased pay to reflect these responsi- under negotiation because of their automated sys- bilities. But because USTR is a small agency, op- tem that provides more pertinent information on a wide variety of issues. Staff productivity has in- portunities for advancement may be limited. creased, the number of meetings required for doc- Productivity ument clearance has been reduced, and the time savings allow them to keep up as issues develop. USTR has a growing workload and the need to The professional staff are faster to act and react, keep up with changing conditions. The “product” have been able to adapt to expanded responsibili- of the agency is, at the broadest level, advice to ties and have better data to support their analytic the President regarding trade policy options and work. The secretarial staff produce work of higher choices, and serving as “honest broker” between quality and the office runs more smoothly. the many groups with an interest in trade policy. The system is appreciated by all of the employ- When measuring the effect of office automation ees in this agency, although to varying degrees. at USTR therefore, one must evaluate fairly in- The senior level employees do not have much oc- tangible products—coordination of discussion, in- casion to use it, the professional employees are terpretation of facts, analysis, and thought. More innovative and interested in their use of it, and 344 Automation of America’s Offices

the support staff’s experiences range from bore- through public assistance, food stamps, Medicaid, dom to hope for advancement. day care, shelters, protective services, and job The results of this study, while not unexpected placement and training. Before 1979, all typing or dramatic, provide indications of the types of was done manually. The massive paperwork and personal and organizational changes that have spiraling costs caused HRA to develop a plan to occurred with office automation and also provide automate. Today, 23 office systems serve 39 of points of departure for speculation on future the 52 program and administrative support areas, changes that might occur as personnel become providing word processing, data processing, and more familiar with the system capabilities. communications in a single system. The DGS provides support services to other city The Impact of Office Automation on the agencies, such as distributing and maintaining municipal supplies and services, producing all city Municipal Work Force of New York City’ publications, constructing and maintaining the Introduction and Background park and street lighting systems, providing all construction services, maintaining city vehicles, and The primary theme evolving from a study of the managing the public radio station. DGS had 2,500 office automation process in three agencies of the full-time employees and a budget of $350 million New York City Government is that management for fiscal year 1984. In order to improve its service strategies and agency goals play a fundamental delivery, productivity, cost containment, and rev- role in determining the effectiveness of public sec- enue enhancement, DGS setup a Technology Task tor as well as private sector office automation. Im- Force made up of technical managers from vari- proved productivity in terms of increased output ous units. All employees were encouraged to take was achieved in these agencies. However, two part in the selection and implementation of office different methods of automating services had systems. Word processing was first introduced in different effects on output, worker satisfaction, and 1980. Two systems with 23 terminals in two build- quality of service. The assembly line style often ings performed straight word processing tasks. used for processes which can be mass-produced The first users were volunteers. In a short time, and processed repetitively, resembles the indus- the demand from workers resultecl in more rapid trial assembly line in its effects. Customized serv- introduction of the systems. The system has been ices that enable creation of databases for new ana- upgraded twice since 1980, evolving from a word lytical purposes were generally more successful in processing system to a hybrid system, which in- increasing output, worker satisfaction, and qual- cludes data processing applications. The system ity of service. is also linked to the city’s central mainframe com- This study looked at four occupational catego- puters to further integrate word and data process- ries—clericals, paraprofessionals, professionals, ing applications. and managers. The principal findings were—an in- The DF administers and collects all taxes, real crease in work output; a perceived increase in the estate assessments, and other city revenue. It quality of output; and under certain circumstances, manages and invests city finances and adminis- evidence of the creation of new work. Reduced em- ters the payroll. Office automation systems have ployment has been an objective of the New York contributed to the department’s efforts to reach City Government since fiscal problems of the mid- its revenue goals. Before 1980, 90 percent of the 1970s and the cost-justification of acquiring auto- work at the DF was batched, typed. and handwrit- mated equipment has included a reduced work ten. Over 1,500 installment agreements for tax pay- force. ments were tracked on 3x5 cards. The quality of The three agencies studied in New York City letters mailed to taxpayers and the productivity were the Human Resources Administration (HRA), of the workers was low. There were few produc- the Department of General Services (DGS), and tion reports or controls and a general lack of man- the Department of Finance (DF). agement control. Since 1980, a centralized word The HRA is the largest municipal agency in this processing pool and a microcomputer center for city, with 24,000 employees and a budget of $4.1 tracking of tax records and producing reports has billion. It serves over 1.5 million poor and elderly been created. In 1984, the DF had 34 micros, 20 word processors, and 40 to 50 terminals connected ‘This sec~ion is based on research performed for ()’f’A b}’ Joan (lreenbaum of (’ity IJniversity of New York, an{i (’ydney Pullman and to the mainframe. The agency is requesting 80 Sharon %ymanski, The I,abor Institute, New }’ork (’it}’. more microcomputers. App, B—OTA Case Studies 345 —

Methodology ing that there is a trend towards more administration and supervision, which mirrors trends in the te approach for this case study was to locate private sector. a number of distinct mini-case sites within the municipal government in which to conduct data gathering workshops. A matrix was developed of Work Organization, Job Satisfaction the following variables—type of office automation, and the Working Environment date of system introduction, and agency service The overall response towards office technology type. Interviews were conducted with appropriate commissioners, city directors, department man- by workers participating in this study was favora- agers and supervisors, and union officials to gather ble. Clerical workers tended to define their satisfaction in terms of release from tedious manual background information and to gain acceptance work. Word processing operators found automa- for the study. tion “more fun” than previous work and perceived Data gathering workshops were conducted for that work quality was improved. Professionals’ each group of employees (clerical, paraprofessional, favorable rating is related to the amount of infor- professional, and managerial), except in the case mation that technology makes available, the speed of managers using personal computers, where it was more appropriate to carry out individual in- and control it provides and the potential for new terviews, Participants were selected on the basis uses of information. Worker participation in the introduction and use of the length of time in the department, with pri- of office automation was most limited in work units ority given to employees who had been in the in which the tasks were previously rationalized. agency before the introduction of the new system. Participants in the workshops filled out activity The automation intensified the rationalization of these tasks. Agencies that had more flexibility in sheet/questionnaires on background and educa- the services they offered, experienced greater tion, job content, work organization, history of worker involvement in the planning and implemen- work site, health and safety, and their recommen- tation process. dations. Discussions then facilitated an interchange Dissatisfaction was expressed by clericals, spe- of information about each subject area and greatly cifically with increased amount of work, routine enhanced the information gathered. and boring tasks, lack of promotional opportunities and physical problems such as eye strain, Employment Effects headaches, backaches, and stress, In a centralized The increase in output has resulted in some re- work organization in the DF, the process involved duction in staff and there are plans for future re- moving the typists and support staff in 30 work ductions. City officials must cost-justify their re- units to a windowless basement room with inade- quests for additional automation and clerical work quate ventilation, lighting, and noise control. Type- is usually targeted for cost savings, because it is writers were removed from work units so that all easy to demonstrate that data-entry and word- correspondence would flow through the central processing functions can be performed with fewer pool. Correspondence was standardized to include workers. The Financial Plan: Fiscal Years 1984- boiler-plate paragraphs. Management sees the ben- 1988 for the three agencies studied projected re- efit as a more integrated work process that can duction of 13 administrative positions in HRA, 36 respond to set quotas, increased quality of work staff positions in DF, and 15 clerical positions in that elicits more confidence from the public, and DGS. These reductions would be achieved by increased tax collections. The women in this unit means of attrition. felt that they were doing more work for which they As a percentage of full-time city workers, office were not being compensated, that the work was and clerical workers declined from 19.7 percent in boring and that learning new skills was thwarted. 1982 to 18.6 percent in 1983, although there had An unintended side effect was that to overcome been increases between 1980 and 1982. The per- lack of an adequate supervisory system, the women centage of professionals has declined while para- had to work together to coordinate and organize professionals increased, The most consistent increase their work; this provided them with a feeling of is in the category of ‘‘Officials and Administra- ‘‘running the show’ albeit without adequate train- tors, which increased from 4.8 percent in 1979 ing and supervisory assistance. to 8.9 percent in 1983. The total number of city The DGS reorganization resulted in small clus- employees did not increase nearly so much, indicat- ters of women working as a team with consider- 346 ● Automation of America’s Offices able control over all facets of their job. The micro- ing so much time on the system caused one ana- computers were introduced as a resource and tool lyst to say, “I need to pause occasionally to remem- for those who chose to use them. Training was pro- ber that I’m a human being. ” vided to all employees by an agency-wide training center, with no segregation by level of employees. Job Content and Occupational Mix The managers of this agency see the lines between clericals and managerial workers blending such Whether skills increase or decrease with the in- that a clerical worker is not “only a clerk” and troduction of office automation did not seem so that managers increasingly take on more clerical pertinent in this study as did a redefinition in the duties. meaning of skill. The traditional view of clerical A correspondence was found in this study be- work sees it as a series of routine, highly repeti- tween the number of hours clericals spent on the tive tasks that must be incorporated into machines equipment and complaints of eye strain, backache, to improve efficiency and productivity. However, stress, and fatigue. Paraprofessionals overwhelm- there are “invisible skills” that cannot readily be ingly linked increased stress with an increase in discerned by an observer but are crucial to the workload and to an increase in supervision in the smooth functioning of the organization. For ex- form of more required reports. The poor quality ample, coding and entering information from the of the working environment contributed to health mail into a CRT terminal requires knowing a vast and morale problems. In most instances, clerical number of current codes and numerous outdated and paraprofessional workers were not consulted codes which must be updated. The process is also about how the introduction of office automation dependent on the worker’s sequential decisionmak- would affect the design of the work process and ing and actions. Since the information entered by work areas. clerical workers instantaneously becomes part of Unlike clericals, professionals tend to use micros the database from which other information, con- for inquiry that is immediately job specific. All clusions and actions will be generated, the respon- of the professionals liked the equipment, but the sibility of the position has increased. The clericals amount of work they do has increased. Case- organized into pools and clusters found an in- workers in HRA expressed frustration with hav- creased need for communication with many differing to spend additional time checking on the infor- ent work units and for judgments as to the mean- mation that is generated by the automated forms ing of the job orders. These “invisible skills” tend system. Before automation, they were responsi- to be used for job descriptions, evaluations, and ble for determining what basic information was salary decisions only for professionals. needed and what forms would be sent out to ob- Tax auditors felt that their jobs were being rede- tain it, Now, a new clerical position and a para- fined by “clerical” tasks. With the new system, professional position are responsible for these pro- their tasks involve checking various forms gener- cedures. The caseworkers feel that these workers ated by the computer, reviewing other auditor’s do not understand what information is important work for errors and lack of clarity, and screening to the process and tend to make more mistakes, batches of tax returns. increasing the workload of the caseworkers. The changed nature of the work has not changed Tax auditors in the DF, question the effective- either the job descriptions or salary level for audi- ness of the automated system since their proce- tors, but such a possibility is reflected in the history dures have become fragmented and, according to of the change in the job content of caseworkers, the auditors, more clerical in nature. They acknowl- classified as professionals. During a restructuring edge that the computer generates more informa- in 1971, the information gathering portion of the tion quicker and provides more control over the caseworkers’ jobs was removed and assigned to status of each case, but feel there is less need for lower paid positions. Many caseworkers were reas- their professional training and judgment. signed as lower paid “Income Maintenance Spe- Analysts in the DGS quickly discovered the cialists’ and ‘Eligibility Specialists. As a result, speed and wider range of reliable information that the 10,000 caseworkers in the city have been re- was available to them. They cited two results—a duced to 4,000. No caseworkers have been hired power shift in their favor (they had more data on since 1972 and there have been virtually no pro- the various work units they visited) and an enlarge- motions. ment of their jobs to include providing more tech- Job mobility for clerical workers was dramati- nical support. Analysts felt peer pressure and self cally changed in the 1970s when steps in the cleri- pressure to become more computer literate. Spend- cal career ladder were eliminated by collapsing App. B—OTA Case Studies 347 some job titles and eliminating others. Because in the word processing pool. Informally they ex- the city is in the process of adapting to office auto- changed information to solve problems collectively mation, job titles, and job lines are in flux and con- and learn new word processing procedures, but tinue to be “worked through” by the city and the they felt better training would have reduced the union. time spent in problem solving. Secretaries in a third group, who had organized their own word process- Productivity y ing cluster and participated in the decision about system purchases, were satisfied with the train- Some managers in the New York City offices feel ing they had received. that to increase efficiency in the production of their Training in DGS encompassed a broad spectrum services, as many clerical procedures as possible of courses for all employees; introductory classes must be standardized and automated. Other man- were available for both clerical and managerial per- agers see no reason to focus on developing word sonnel. A great deal of on-the-job informal train- processing skills, much less job ladders, because ing took place. The training center for this agency they believe fewer word processing clericals will was funded in part by outside grants and also oper- be required when more managers learn to use ated a retraining program for public assistance microcomputers. women, who were trained in word processing and All workers perceived an increase in work due given temporary trainee jobs within the agency. to a combination of factors including work inten- The program is apparently very successful and the sification, creation of new work, reorganization of access of clerical workers to a wide range of courses work and need for more error correction. For cleri- seemed to enhance their motivation and self-esteem. cals and most paraprofessionals, the increase in While professionals complained most about lack output came when automated systems were used of time to learn new applications, they were gener- to incorporate large amounts of previous manual ally pleased with their training. Complaints cen- work into preceded forms and standardized let- tered around their reliance on a minicomputer net- ters. This meant the elimination of handwriting work and a mainframe database which kept them and typing hundreds of forms and letters per week dependent on the technical staff to solve problems. and a reduction in the time spent hunting for files “Downtime” due to an expanded communications throughout the work unit, which spans several system exacerbated this problem. floors. But although clerical workers were en- Managers, like professionals, said that they were thusiastic about being released from the manual too overworked to take advantage of formal train- processes, many of them now spend almost their ing programs but felt some peer pressure to do entire day in front of VDT screens, In centralized so. In order to overcome this problem, courses work units, the integration of the process gives would have to be acknowledged as having priority the manager more control through the establish- over some work. ment of work quotas. In a decentralized reorganization, the change in Conclusions workload resulted from a unique set of circumstances—managers were performing their own This case study paid particular attention to the writing and editing to such an extent that the sec- interaction of office automation and changes in job retaries were bored from lack of work, They re- content, work organization, and the physical envi- quested extra work from other groups inside and ronment. An overall increase in the output per outside the agency. worker was found; however, this was not necessarily followed by an increase in the quality of services produced. Training Job content was changing; the redefinition of Clerical workers who primarily performed data- skill caused an increase in the number of definable entry functions were given only a few days train- tasks performed and a shift in the type of tasks. ing in entering codes into the system. They felt Office automation enhanced the need for concep- frustrated about their lack of knowledge of the sys- tual knowledge and abstract thinking at all occupa- tem and had a low level of motivation. They re- tional levels. Changes in job content are affecting ceived no word processing training and there were job ladders and promotional opportunities. There no plans to offer them further training. Another are few promotional paths that could be used to group of clericals whoc) were former secretaries had encourage clerical workers to use their invisible been sent to training class when they were placed skills to gain entry to high-level jobs. 348 Automation of America’s Offices —

Departmental reorganizations accompanied of- These Municipal Government agencies are suffi- fice automation with some centralizing of clericals ciently large and complex to serve as a microcosm into pools and some decentralizing into clusters for identifying office automation issues in the Fed- and small project teams. The technology did not eral Government as well as other large city and dictate one form of organizational structure. State governments and corporations. Complaints of greater stress have been heard at all occupational levels, most notably from clericals and paraprofessionals. o