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Thursday, January 10, 2019

You Need To Do A Cost Analysis

"You Need To Do A Cost Analysis"
The following post relates to my job over thirty years ago and is as boring as shit.  If you are suffering insomnia it is recommended reading.

Back in the computer stone age, I worked for a stock broker in the Stock Exchange order Processing Department.  Everything we worked with was on mainframe computers accessed by “dumb terminals.”  The dumb terminals accessed information and programs from the main frame computers.

Processed information was maintained on tapes and or printouts, not digitally on a computer.  Our firm’s activity on the Exchanges on any day resulted in a paper print out around six feet high.   After a month those printouts were maintained on film.  Records of sales on the exchanges were maintained on printouts piled about 2-foot-high each day, and then also on film.

We had a dumb terminal to access daily processing information, and a different dumb terminal to make processing entries to the mainframe.

Researching a problem only a day or two old might take only a few minutes, something older could take an hour, something from weeks back could take most of the day.

When a problem was resolved, it often meant taking copies of reports and mailing them to the branch office which raised the issue.

Sometime in the early 90’s, I was asked to test a PC as a replacement to the dumb terminals.

It did not take me very long to realize that number one, the PC could access multiple applications on multiple windows.  This saved time and made research super easy.

I then learned that we could receive and send messages to branch offices on the computer, and not off a teletype machine sent from a specialist teletype operator.  Further it was determined that we could capture information and save it and access it on the PC from multiple servers.

Research could be done from one station and PC; results could be emailed to the office in seconds.

Within a week I reported that this was technology that we needed to pursue and implement ASAP.

I was told,

“We’ll need you to do a cost analysis.”

I did not go to graduate school of business.  I barely limped out of college.  Those needing a “cost analysis” were fresh out of smarty town, there was a book and by golly they were going to go by it.

Now I am not knocking the “cost analysis” process.  In the early days of our computer processing requests, we had spent zillions of dollars, often to save hundreds of dollars. 

This however was a no brainer.

“So” I said, “if McCormack showed you his reaper which would replace and do the work in one day of one hundred workers in a week, would you need a cost analysis?”


“OK then, 10 PC’s will replace 20 dumb terminals.  The PC’s are $1500 a piece one time, the dumb terminals cost $75 a month each leased from IBM, the leases would last FOREVER.  Research time will be cut in half, requiring less personnel; we can cut paper printed records by about 100 pounds per day and we save about 1000 square feet of storage space.  Besides a night and day improvement in service and accuracy I would calculate the cost savings to be about a large bucket of 100 dollar bills every day.”

“That is not a very professional analysis!”

“Would you do an extensive cost analysis on replacing the horse and buggy with a John Deere Tractor?”


“Then have at it, I did not take cost analysis in school”

I wonder why I never even got to see where they keep the glass ceiling.

It took about 6 months to slowly start replacing stone age technology with new computer technology.  Maybe two years before we eliminated most of the paper.

The most difficult adjustment was teaching people to double-click with a mouse.


  1. I remember these times and dumb terminals. We are from the same era, Joe. Anytime you save human hours you're saving money. This was a no brainer.

    Have a fabulous day, Joe. 😎

  2. It takes real stupidity to be a supervisor.

  3. Agreeing with Catalyst, as i've known some very stupid people who were managers.

  4. We used dumb terminals at the unemployment office! Which I am sure will surprise no one.

  5. I'm having a real laugh over here at the simplest task to teach being the double-click on the mouse. it's often the way though, the simplest things just don't seem to fit in the mind-mainframe once everything else is in there.

  6. GS started as a wire operator in a branch.
    She got to place every order and make every inquiry through her terminal.
    Eventually she trained her replacement and found was trained for other stuff.
    When the Operations Supervisor left the job became hers, just in time to change over to PCs and servers.
    She got to be the one to show the brokers how the new system worked.
    Fun times.

  7. Even the mouse has changed. Seriously, I haven't clicked one for years. Anything more technical was beyond my brain power so to my mind you were a genius even then!

  8. I find it difficult using the quill pen to tap every key on the keyboard. It takes me ages to send an e-mail. I wish there was a quicker method.

    God Bless.

  9. Lol, I love these posts, because it reminds me of my early days of working! People don't change though; they still hate change!

  10. It was an exciting time when PCs entered the workforce. I remember it well.

  11. We're fortunate to have seen the advent of so much new technology. My first experience with computers was with one huge booger that filled an entire room, ceiling-to-floor. I had to punch all of the data into IBM cards and then load 'em into the machine, which then took forever to process. (Then, of course, the doctors wanted me to disregard any data points that didn't prove what they were trying to prove...) I remember when my hubby, who worked for Bell labs, declared that he was never going to use a computer. HA! Didn't take him long to get onboard when he realized how much it simplified his job. (Didn't take a darned "cost analysis" to figure it out, either!) Now he's a computer whiz kid. Me? I'm quite proficient at the ol' double-click...

  12. I was hired into my first job to help bring the first CAD system into our company (late 70s). Some of the older guys were still using slide rules (and getting just fine answers, may I say). I am still the voice of simplicity in my office. Why do a massive computer analysis, when there's a simple formula that will give you just as good an answer?

  13. I started at IBM in 1984 doing programming on a mainframe using dumb terminals. IBM was a leader in PCs at the time (BTW- summers during college I worked in quality control for IBM at IBM vendors for ... PC components) IBM provided our department with its first few PCs around about 1988. Mostly PC/XT's that were originally released in 1983. Those of us low on the totem pole received those used XT's from managers and the muckety muck round about 1990 because the cost analysis included retail cost of the PC added to the profit 'lost' by not selling it to customers ... like you!

    BTW- I owned my first personal PC (Zenith!!) for 12 months in 1983 (college subsidized) but had to sell it to be able to afford graduation fees. Sad but true....

  14. Some people just can't raise their foot out of the well worn rut they are in to walk on smooth pavement. I was lucky to have a boss who loved and easily saw the advantages of change.

  15. Change is always hard... I had a headache for a few days when - after decades of using Windows PCs - switched to a Mac last spring.