mitting guidelines for studies to precede the utilization of automatic data processing equipment. Studies of this nature have in the past been referred to as feasibility studies. The Bureau emphasized the need for a thorough analytical study to be conducted before decisions are made relative to the economic and operational feasibility of any ADP application. The House Appropriation Committee, in its report (H. Rept. 1427, 86th Cong.) on the general Government matters appropriation bill for 1961 had this to say regarding controls over installation of automatic data processing equipment: The committee takes note of the need for a focal point within the executive branch of the Government in the field of automatic data processing, and expects the Bureau of the Budget to take steps necessary to ensure that electronic data processing techniques will be employed where necessary in the interest of effectiveness and economy, and conversely that data processing devices will not be introduced when there is no clear justification in terms of economic value. The staff of the Committee on Government Operations, at the direction of the chairman, made a study during the 86th Congress of the systems and equipment relating to assembling, translating, indexing, abstracting, storing, processing, retrieving, and disseminating scientific and technological information, including some aspects of data processing, now in operation or being developed within Federal agencies. This information was issued by the committee in Senate Document 113, dated June 23, 10. While this report basically covers the documentation, indexing, and retrieval of scientific information, it contains excerpts of reports from departments and agencies relative to advancements made in electronics data processing during the calendar year 1959 (pp. 27-281 The Subcommittee on Census and Goverment Statistics of the House Committee on Post Office ar i Civil Service issued a report (committee print, 86th Congo), dated Arst 31, 1960, on the use of electronic data processing equipment in the Federal Government. The report contained a detailed inventory, by department and agency, giving location, model number or name, rental or purchase cost, size, Class, and application of the 324 electronic con.puters used throughout the Federal Government as of June Se, 1960. Based upon its herings, studies and material furnished by agencies of the Government, the subcommittee made the following recommendations in its report relative to general planning, personnel matters, and use of electronic data equipment: General planning 1. Installation of electronic data-processing equipment should be preceded in all cases by a comprehensive feasibility study having top management supert and involving a review of the entire system. 2. No matter at what level within the agency or department a few ability study is launched, consideration should be given to the possibility of wider integration of needs and mass beyond the immediate interest, to take advantage of the economy and scope of central red large-scale equipment. 3. A policy should be determined centrally for the guidance of agencies in determining whether to rent or to purchase electronic data-processing equipment. 4. More attention should be given to achieving compatibility within and between electronic data-processing installations, through greater standardization of specifications and through development of data and program conversion techniques and devices. 5. An experimental service center for electronic data processing should be established within the Government. 6. Government-wide orientation courses, centrally directed, should be maintained to provide executive and management officials with a basic understanding of the principles of evaluating, installing, and managing electronic data-processing systems. 7. Periodic inventories, including information on uses and costs, should be taken of electronic data-processing equipment held by the Government. 8. The Interagency Committee on Automatic Data Processing should be continued with better staff support provided by the Bureau of the Budget. Personnel matters 9. Personnel officials should be included in the general planning for electronic data processing equipment at the point a decision is made to utilize it. 10. Where a net reduction in employment is expected to occur as the result of the introduction of electronic data processing, every effort should be made to accomplish it by normal attrition and not by reduction-in-force procedures. 11. Adequate advance notice of conversion to electronic data processing should be given to all employees who might be affected. Communication between management and employees should be maintained throughout the progress of the conversion process. 12. Retraining to equip with electronic data processing skills should be made available at Government expense to employees scheduled for displacement. The provision should be made sufficiently in advance of conversion to enable employees who are qualified to be retrained to obtain first consideration for the new jobs. 13. When there is a displacement of employees resulting from conversion to electronic data processing, the agency should impose a freeze on hirings in those grades for which the displaced employees can qualify within the agency. 14. Transfers to other jobs of employees displaced by electronic data processing should be effected on the broadest possible basis to other parts of the agency, other agencies in the locality, and other localities. When necessary, the Government should take steps to assist employees to obtain jobs in private industry. 15. Government rates of pay for key electronic data-processing personnel should be maintained at levels consistent with those of private industry. Use of equipment 16. Electronic data processing generally should be restricted to operations which are important in the making of decisions, and not filled up with miscellaneous jobs for which it is not well suited. 17. The number and complexity of reports turned out by electronic data-processing equipment should be limited, in each application, to that which is actually needed. The equipment should not be permitted to become a gigantic papermill simply because of its speed and capacity. 18. The ability of electronic data-processing equipment to make simple, preprogramed decisions should be fully exploited. Output reports for decision-making purposes should be limited to those unusual items requiring executive decision. 19. Surplus time on electronic data-processing equipment should be made available on a reimbursable basis to other parts of the agency and other agencies. A central exchange service, as well as an interdepartmental exchange service, should be established to coordinate supply and demand relating to spare time. 20. Programing work and input data preparation should be initiated at a sufficiently early date to provide adequate useful workload for the electronic data-processing equipment beginning with its expected acceptance date and for each interval of use thereafter. 21. The Bureau of the Budget and other Government agencies should consider the feasibility of using electronic data-processing equipment to speed up and improve the budget preparation processes. SAVINGS RESULTING FROM FINANCIAL IMPROVEMENTS The evolutionary nature of improvements in financial management systems and techniques produces long-range qualitative benefits which cannot always be expressed in terms of direct and specific dollar savings. However, examples of substantial savings due to simplications and improvements have been reported by various agencies in the annual reports of the joint program, many of which are of recurring significance. Some of these savings have been mentioned previously in this part of the report, particularly savings in the operations of the three central agencies. Other examples reported by agencies during the past several years are as follows: 1. Consolidation of the five finance offices of Agriculture's Farmers Home Administration with related simplification of budgeting, accounting, and reporting procedures saves approximately $1 million in personal services, $50,000 in tabulating machine rental, and $65,000 in office space rental, annually. 2. Department of the Army saved $1 million at locations operating under improved management controls provided by industrial funds and related accounting and cost control systems—also, inventories reduced by $2,600,000 at two locations through disclosure of excessive levels. An improved report under Army's new financial property accounting system eliminates seven sepa rate uncoordinated inventory reports which had cost $1.5 million per Army estimate. Corps of Engineers (civil functions) through improved programing and accounting reduced the volume of reports forwarded to the Office of the Chief of Engineers by 70 percent-also, reduced the staff associated with civilian payroll accounting by approximately 50 percent at an estimated savings of $500,000 a year. 3. Improvements in Department of the Navy's supply management control disclosed $1.9 billion in excess and obsolete stocks of which $1.35 billion has been scheduled for disposal-in Navy stock fund alone, improved inventory management achieved a reduction of nearly $500 million in stock levels with an additional reduction of more than $80 million in the annual rate of procurement. This permitted a reduction in the cash balance of the stock fund of $250 million in fiscal year 1953 and another $200 million in 1954. 4. Department of Air Force, by management utilization of accounting and financial records, reduced the cost per dollar of sale of its clothing stock fund by 20 percent in one installation, and in one worldwide command sales increased 58 percent with a 50 percent lower inventory. 5. A combined payroll-reimbursement voucher-blanket travel authorization form developed by the Bureau of Census for use in paying temporary field employees eliminates thousands of travel orders and related vouchers with estimated savings to the Bureau of about $300,000. 6. Further simplification of procedures and proficiency gained by personnel under the revised accounting system of the Maritime Administration, Department of Commerce, permitted reduction of 33 accounting employees. 7. Continuous fanfold transfer posting schedules installed in General Services Administration saves approximately $20,000 annually. 8. Government Printing Office reduced its billing rates to other agencies by about 5 percent due principally to expense reduction occasioned by simplified and improved procedures. An example of expense reduction is the decrease of 40 employees in the Office of the Comptroller during the year. 9. Revised method of preparing checks for old-age and survivors insurance benefit payments saves in excess of $100,000 annually as a result of coordinated procedures between the Bureau of Old-Age and Survivors Insurance and Division of Disbursement, Treasury Department. 10. Bureau of Old-Age and Survivors Insurance, Department of Health, Education, and Welfare, will save $150,000 annually by adoption of revised procedures, based on additional experience and knowledge, to reduce workload in investigating self-employment tax returns; use of a combined award form extended to 185,000 awards annually saves about $17,000; and replacement of 29 conventional electric accounting machines with 18 highspeed machines along with important procedural changes will effect savings of $260,000 per year in accounting operations. 61157-61-11 11. Revised payroll procedures in Federal Bureau of Investigation, Department of Justice, should result in annual savings of approximately $36,000. 12. The Railroad Retirement Board estimates savings of $90,000 per annum due to the integration of accounting and disbursing functions involving over a half million checks per month for retirement and survivor benefit payments also, issuance of a single check to families rather than separate checks to the widow and each surviving child has reduced the number of items paid and certified by 300,000 per year with an estimated yearly saving of $25,000. 13. Treasury Department, Internal Revenue Service, substituted regional office reports prepared from basic field records for detailed budget and personnel data previously developed in national office with reduction of nearly a quarter million documents forwarded to Washington and savings in machine rentals and supplies estimated at $107,000 per annum. 14. Relocation of supply facilities by the U.S. Coast Guard under its broad program for improvement in financial management results in savings in personnel costs of approximately $40,000 per year and about $60,000 a year in annual rental to General Services Administration. 15. Seventeen million card index files of Veterans' Administration beneficiaries maintained in Veterans' Benefits Office by 23 full-time employees was discontinued resulting in substantial savings in personnel and equipment. 16. Thirty-two outmoded and superseded reports of various agencies previously required by law to be submitted to Congress were eliminated with estimated annual savings of approximately $130,000. 17. A new punchcard form of transportation request for use on and after July 1, 1955, representing an annual savings in printing costs of $150,000 a year, provides both rail and pullman accommodations by issuance of a single request. 18. Post Office Department revisions in financial policies and procedures has greatly increased efficiency through better management in many areas. Measurable savings include elimination of 520,000 daily financial statements and 435,000 reports annually by discontinuing physical segregation of cash by funds; identifiable savings of $2.5 million by extension of the direct deposit procedure initiated last year; estimated annual savings of $3.8 million resulting from adoption of punchcard postal saving certificate and related simplifications and mechanization of accounting; installation of a standard cost system for mail equipment shop along with improved management achieved an 11-percent increase in efficiency; application of whole dollar concept and other changes in procedures for handling small remittances resulted in a 32-percent reduction (from 8 to 5.4 million) in total remittances; and, discontinuance of regional segregation in listing of paid money orders by Federal Reserve banks indicates a probable saving of more than $200,000. 19. Further progress in the program to convert 32 million remaining paper checks to punched card checks begun 3 years ago, |