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Computerization Takes Too Long

November 22, 2016

Chapter 26 in the exclusive series for Dynamic Commodities- becoming a commodities trader

The bulk of transactions handled by the precious metals traffic clerks each day were enormous. It was the early 1980’s and computers were new on the scene in the business world. When I arrived in the department, Ray Nessim was in the early days of modernizing the business, spending millions on a computer system that would reduce errors and eliminate certain job functions, saving lots of money for the department by creating efficiency. However, the project would take years.

Two programmers, Michael Liss and Greg Leck, spent hours learning about all of the transactional flows that occurred on a daily basis within the department. The meetings and questions were endless. The computerization commenced in the trading room so that those who would bring the business into the modern era could understand and program a series of steps that took into account everything that occurred when the traders would buy or sell as well as the many different types of transactions. Nothing could be left to chances when it came to programming a system that worked and Ray Nessim was personally involved as he had authorized a massive budget for computerization.

The programmers would draw diagrams of transaction flows on a white board and the traders and traffic people needed to fill in the many blanks which amounted to the probabilities of different settlement and operational procedures. The first completed task by the programmers was to create a trade capture system where every transaction was entered into a computer which then collated the data and spit out a daily transaction report. The traffic clerks would then check the computer generated report at the end of each day against their manual logs highlighting all errors. A dual system amounted to double the world for the traffic department and the increase in work was likely the reason I was there.

The late nights in the office were because of computerization. The clerks completed the traditional operational and traffic work during the business day and then turned to checking the computer reports after hours. As the computer project progressed the days got longer, there was more to check. Each enhancement to the system resulted in complications, errors and kinks that impacted earlier programming errors. As time went on the overhead bills grew as the programmers hired more staff to address issues. Ray Nessim became impatient and annoyed as he was spending millions with slow results. I would often hear screaming from behind closed doors as the programmers huddled with the boss to explain the delays in reaching goals. They would walk out of the office with sullen faces, looking like beaten dogs after a session with Ray. I thought to myself, how ironic; the system that would speed things up is slowing things down and the anticipated cost savings was resulting in massive expenses.

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Post Series: Origin Of A Commodities Trader

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