An Evaluation of the Need for New Information Technology to Support Branch Operations

Abstract

The study focuses on the improvements in planning effectiveness and information selection that may result from a change in information processing technology at the middle management level. The subjects selected for inclusion in this study are branch managers and insurance executives from eight of the largest property-liability insurers. Participants were asked to work with and evaluate the comparative benefits of two information sources, one representing current practice-and the other representing new information technology. The latter information system utilized a computer terminal and interactive data accessing and forecasting routines. A significant number of decision science techniques has been developed and operationalized over the past three decades. However, the frequency with which quantitative models or the output of such models have been utilized successfully by line managers in their decision-making activities has been low-especially in view of the potential contribution of the models [1, 7, 9, 12]. Therefore, an implementation gap between the tools and techniques developed and the incorporation of those tools and techniques into management decision-making processes has resulted. The seriousness of the problem has heightened with advances in computer technology which now have made available to the field manager a plethora of peripheral and remote on-line, real-time access devices. The field manager could now submit input via a terminal to quantitative models and receive the output of such models as part of an overall computer-based information system of the firm. Whether managers at various levels in an organization will utilize the expanding capabilities of the organization's information system in order to increase the profitability of their respective operations is a critical issue today. The concept of implementation, as used in this paper, refers to the installation and use of quantitative models and data bases as part of an overall computerized information and decision-support system. The output of the system can be in the form of representations of the operating environment, solutions to planning and/or control problems, or simply Robert J. Campbell is an Assistant Professor of Accountancy, Miami Univerity, Oxford, Ohio. He has published in Taxes-The Tax Magazine and Cost and Management.