ISSA. INTERNATIONAL CONFERENCE ON THE CHANGES IN THE STRUCTURE AND ORGANISATION OF SOCIAL SECURITY ADMINISTRATION. INTERNATIONAL CONFERENCE ON THE CHANGES.

ISSA.ISSA.

INTERNATIONAL INTERNATIONAL CONFERENCE ON THE CONFERENCE ON THE

CHANGES IN THE STRUCTURE CHANGES IN THE STRUCTURE AND ORGANISATION OF SOCIAL AND ORGANISATION OF SOCIAL

SECURITY ADMINISTRATION.SECURITY ADMINISTRATION.

KRAKOW 3-4 JUNE 2004.KRAKOW 3-4 JUNE 2004.

..

Theme 2 Friday , 4 June 2004Theme 2 Friday , 4 June 2004

The Impact of Information and The Impact of Information and Communication Technologies (ICT)Communication Technologies (ICT) on the Structure, Organization on the Structure, Organization and Administration ofand Administration of Social Security SchemesSocial Security Schemes

ByByDr Adam H MayinguDr Adam H MayinguDar es salaam, TanzaniaDar es salaam, Tanzania

This Presentation highlights;This Presentation highlights;

The alignment between business The alignment between business strategy and ICTstrategy and ICT

ICT deployment ; a PSPF case study.ICT deployment ; a PSPF case study. Challenges faced by developing Challenges faced by developing

countries in adopting countries in adopting ICT.ICT. How ICT development affects the How ICT development affects the

structure and organisation of structure and organisation of scheme administratorsscheme administrators..

1.01.0 IntroductionIntroduction

The demand for quick, efficient and The demand for quick, efficient and secure service delivery to clients as secure service delivery to clients as well as other stakeholders’ well as other stakeholders’ expectations has made the expectations has made the administration of social security administration of social security schemes and Governments adopt new schemes and Governments adopt new business models that embrace the business models that embrace the use of ICTuse of ICT . .

2.02.0 Social Security Institutions Social Security Institutions from Corporate Perspectives.from Corporate Perspectives.

Social security schemes like other Social security schemes like other organisations organisations

develop their Corporate Strategic plans that develop their Corporate Strategic plans that

guide them for a particular planning horizonguide them for a particular planning horizon . .

““A Strategy is a unified, comprehensive and A Strategy is a unified, comprehensive and integrated plan that relates the advantages of integrated plan that relates the advantages of the firm to the challenges of the environment. the firm to the challenges of the environment. It is designed to ensure that basic objectives It is designed to ensure that basic objectives of the entreprise are achieved through proper of the entreprise are achieved through proper execution by the organisation” (Jauch and execution by the organisation” (Jauch and Gleck,1988)Gleck,1988)

Strategic planning delivers amongstStrategic planning delivers amongstothers :-others :-

· A plan that is aligned with the vision and · A plan that is aligned with the vision and objectives of the organisation.objectives of the organisation.

·· An assessment of business trends - How An assessment of business trends - How the functional mission is changing.the functional mission is changing.

·· An assessment of An assessment of corporate trendscorporate trends - - Organisation and Component directions.Organisation and Component directions.

· An assessment of · An assessment of technological trendstechnological trends - - What will be economically feasible and What will be economically feasible and relevant in the future.relevant in the future.

· A plan to satisfy the critical information · A plan to satisfy the critical information requirements of the organisation.requirements of the organisation.

3.03.0 ICT DevelopmentICT Development.. The cost of equipment going down and The cost of equipment going down and increase of processing capacity .increase of processing capacity .

Distributed systems- small systems, need for Distributed systems- small systems, need for resource sharing and up to date information resource sharing and up to date information requirements.requirements.

Diversity of networking options, LAN, WAN, Diversity of networking options, LAN, WAN, broadband,wireless which is faster to deploy.broadband,wireless which is faster to deploy.

Emergence of internet and World Wide Web.Emergence of internet and World Wide Web.

4.04.0 Typical use of ICTTypical use of ICT

4.14.1 Introduction to PSPFIntroduction to PSPF EEstablished by the Parliament of stablished by the Parliament of the United Republic of Tanzania the United Republic of Tanzania through Act No.2 of 1999 to provide through Act No.2 of 1999 to provide for contributions to and payment of for contributions to and payment of pensions, gratuities and other pensions, gratuities and other benefits in respect of the service of benefits in respect of the service of officers in the Government and officers in the Government and employees of Executive Agencies.employees of Executive Agencies.

From July, 2004 the Fund will start From July, 2004 the Fund will start to pay various benefits to members. to pay various benefits to members.

4.2 The Business and 4.2 The Business and Administration Functions for Administration Functions for

AutomationAutomation Pensions and Benefits Administration.Pensions and Benefits Administration.  Finance/Accounts and Investment Finance/Accounts and Investment management.management.    Integrated Payroll and Human Integrated Payroll and Human resource management.resource management.    Office automation systems, Office automation systems, internet/intranet services.internet/intranet services.    Document Image management Document Image management system linked to respective system linked to respective databases.databases.

4.2 The Business and 4.2 The Business and Administration Functions for Administration Functions for

Automation Automation

    Help desk management system/ Help desk management system/ problem-log tracking system.problem-log tracking system.

  Web site to facilitate information Web site to facilitate information delivery to the members, employers delivery to the members, employers and the public in general.and the public in general.

  Having temper-proof Identification Having temper-proof Identification cards for pensioners/members.cards for pensioners/members.

4.34.3 The approach for software The approach for software acquisition.acquisition.The Fund opted for off the shelf The Fund opted for off the shelf solutions because by buying from solutions because by buying from outside:outside:1.1.            The management will focus on core The management will focus on core business rather than business rather than Information Information technologytechnology

2.2.            The services and support will be offered The services and support will be offered by specialist providers.by specialist providers.

3.3.            There will be great flexibility through There will be great flexibility through freedom of choice.freedom of choice.

4.4.            More control due to customer-supplier More control due to customer-supplier relationship.relationship.

5.5.            The system will be up and running within The system will be up and running within a short time.a short time.

4.44.4 Project management Project management methodology.methodology.

The methodology adopted by PSPF The methodology adopted by PSPF and how it fits in the overall project and how it fits in the overall project life-cycle is conceptually shown in life-cycle is conceptually shown in the figure below. the figure below.

4.54.5                          Project Achievements.Project Achievements.4.5.14.5.1 General Systems General Systems

architecturearchitecture

The Fund has decided to go for a 3-Tier The Fund has decided to go for a 3-Tier Client/Server architecture.Client/Server architecture.In this model, a front-end application will In this model, a front-end application will communicate with a dedicated application communicate with a dedicated application server process (agent) running on a server server process (agent) running on a server on the network. .on the network. .

The reasons that prompted the Fund to go The reasons that prompted the Fund to go the 3-Tier way are improved system the 3-Tier way are improved system scalability, improved responsiveness, real-scalability, improved responsiveness, real-time processing ability and much smaller time processing ability and much smaller (and therefore easier to debug) front end-(and therefore easier to debug) front end-applicationsapplications. .

4.5.24.5.2 Application Software and Application Software and

DatabasesDatabases

Application/product Application/product RemarksRemarks Pensions and Benefits Pensions and Benefits Administration Administration System(ComPen)System(ComPen)

Operational, benefits Operational, benefits awaits July 2004.Upgraded awaits July 2004.Upgraded to GUI and RDBMSto GUI and RDBMS

Accounts/Investment systemAccounts/Investment system

(SmartStream)(SmartStream) Operational but investment Operational but investment not fully accommodatednot fully accommodated

Document Management Document Management System(LaserFiche)System(LaserFiche)

Operational except the Operational except the workflowworkflow

Payroll and Human resourcePayroll and Human resource

(e-horizon)(e-horizon) Operational except HR Operational except HR implementation still on implementation still on goinggoing

Office Automation Products Office Automation Products with intranet and internet with intranet and internet (including web site)(including web site)

OperationalOperational

Enterprise PortalEnterprise Portal OperationalOperational

Help deskHelp desk OperationalOperational

Smart cards-IDsSmart cards-IDs OperationalOperational

4.5.3 Pensions Administration 4.5.3 Pensions Administration System – Com_Pen 2000System – Com_Pen 2000

Architecturally, The Com_Pen 2000 Architecturally, The Com_Pen 2000 system will be configured in a 3-Tier system will be configured in a 3-Tier configuration.configuration.

A pictorial representation of the logical A pictorial representation of the logical model of the Com_Pen 2000 system to be model of the Com_Pen 2000 system to be put in place is depicted here under:put in place is depicted here under:

4.5.3 Pensions Administration System – 4.5.3 Pensions Administration System – Com_Pen 2000Com_Pen 2000

Mo

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upd

ate

Mo

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ly In

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Ben

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alculatio

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gen

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Ben

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aymen

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Ben

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ent

Database & OS Security

Sybase & Unix (Linux Red Hat)

OS & RDBMS

Services

Business rules

Tools & Utilities

Fund admin. backbone

param

eterised

Help Letter generator

Audit trail

Menu Security register

Application and User level Security

Workflow Report writer

Enterprise Portal (EP)/Enterprise IntegrationExternal Interfaces

Acu thin Cheque printing

AcConnect

cuCobo Runtime

Core module

Defined contr.

Defined Benefit.

Fund Acc.

Pens. Payroll

Loan Admn.

Funeral Benefit

Document Image Mgnt

4.5.4 Accounting System– 4.5.4 Accounting System– SmartStream 6.5SmartStream 6.5

SmartStream is an integrated accounting SmartStream is an integrated accounting enterprise resource planning (ERP) enterprise resource planning (ERP) application designed for large application designed for large organizations. organizations.

SmartStream is embedded with workflow SmartStream is embedded with workflow technology that facilitates the flow of technology that facilitates the flow of work among users automating manual work among users automating manual and repetitive processes. and repetitive processes.

4.5.5 Document Image Management 4.5.5 Document Image Management

Application – LaserFicheApplication – LaserFiche

PSPF stores scanned images of Letter of first PSPF stores scanned images of Letter of first appointment, letter of confirmation on pensionable appointment, letter of confirmation on pensionable terms and registration forms bearing photograph terms and registration forms bearing photograph and fingerprints for all members of the Fund. The and fingerprints for all members of the Fund. The Fund has acquired a specialized software product Fund has acquired a specialized software product called LaserFiche for archiving, managing and called LaserFiche for archiving, managing and retrieving of all organizational documents with a retrieving of all organizational documents with a view of creating a paperless office environment. The view of creating a paperless office environment. The system has in built workflow which enables the system has in built workflow which enables the users to send document on-line just as physical files users to send document on-line just as physical files are handled.are handled.

Horizontally this application is integrated with Horizontally this application is integrated with other applications, particularly the pension other applications, particularly the pension administration system (Com_Pen) for easy of administration system (Com_Pen) for easy of documents retrieval during pension processing.documents retrieval during pension processing.

4.5.5 Document Image Management 4.5.5 Document Image Management

Application – LaserFicheApplication – LaserFiche

Sybase Enterprise Portal (EP)Sybase Enterprise Portal (EP)

All the systems as described above All the systems as described above are wrapped together within the are wrapped together within the enterprise portal (EP). enterprise portal (EP).

Benefits of having the Portal in Benefits of having the Portal in place place

Single sign-on facilitySingle sign-on facility ie ie seamless seamless single point accesssingle point access

Simple integrationSimple integration

Architecture with EP Architecture with EP (Horizontally & vertically (Horizontally & vertically

integratedintegrated

Compen

SmartStream

e-Horizon

DIM Helpdesk

EP

The PSPF EPORTAL

Databases & Operating Systems:Databases & Operating Systems:

Databases:Databases:Oracle 9i Standard edition, unlimited usersOracle 9i Standard edition, unlimited users

Sybase Adaptive Server Enterprise 12.5Sybase Adaptive Server Enterprise 12.5

Operating Systems:Operating Systems: Red Hat Linux 7.3Red Hat Linux 7.3 Windows 2000 ServerWindows 2000 Server Windows 2000Windows 2000

Hardware Hardware AcquiredAcquired

Flat monitor PCs with Cordless mouse Flat monitor PCs with Cordless mouse and keyboards, radio/Tv tuner cardsand keyboards, radio/Tv tuner cards

  NAS and serversNAS and servers

  Broad band internet with security Broad band internet with security system.system.

What Happened? What Happened?

ManagementManagementThe Project Sponsor had been very supportive The Project Sponsor had been very supportive thus influencing other stakeholders. thus influencing other stakeholders.

The project implementation is included in the The project implementation is included in the CEO’s progress report to every meeting of the CEO’s progress report to every meeting of the Board of Trustees. The Fund now has the Board of Trustees. The Fund now has the capability of making prompt payments and capability of making prompt payments and members’ records are up to date.members’ records are up to date.

Technical IssuesTechnical Issues While we had planned to standardise on one type of While we had planned to standardise on one type of RDBMS; circumstances forced us to go for two.RDBMS; circumstances forced us to go for two.

For some reasons such as un-certification of some For some reasons such as un-certification of some platforms by contracted vendors we started with 2 platforms by contracted vendors we started with 2 tier and later on will move on to 3-tier architecture.tier and later on will move on to 3-tier architecture.

The envisaged ICT infrastructure was to have an The envisaged ICT infrastructure was to have an elaborate Executive Information System that gives elaborate Executive Information System that gives management an up to date status of the operations. management an up to date status of the operations.

On the pensions administration; we requested an On the pensions administration; we requested an upgrade to GUI and change of database type which upgrade to GUI and change of database type which the supplier estimated it will take 4 months but it the supplier estimated it will take 4 months but it ended up going on for 8 months.ended up going on for 8 months.

It has been clear that our ICT strategy has It has been clear that our ICT strategy has been far ahead of all suppliers especially the been far ahead of all suppliers especially the integrationintegration

The state of the art ICT also had problems The state of the art ICT also had problems being understood by some consultants (e.g. being understood by some consultants (e.g. wireless keyboards and mouse, the 3-tier wireless keyboards and mouse, the 3-tier architecture).architecture).

Getting competitive proven software Getting competitive proven software application product for pension administration application product for pension administration was difficult.was difficult.

Human Resources and other Human Resources and other people involvementpeople involvement

Referred to here are the fund administration Referred to here are the fund administration staffs as well as the stakeholders.staffs as well as the stakeholders.

Outsourcing

• The Fund hired specialised computer training experts who carried out the training to all staff including the CEO on how to use computers

• Payment of benefits has been outsourced to financial institutions through competitive tendering.

Relation with partnersRelation with partners

So far with the exception of one supplier; So far with the exception of one supplier; the relations have been relatively goodthe relations have been relatively good..

Surprises

• Wireless equipment-at early days knowing that the equipment require batteries replacement was difficult especially the very early days

5. Adoption of ICT and the 5. Adoption of ICT and the Challenges to Developing Challenges to Developing

CountriesCountries..

In developing countries ICT adoption In developing countries ICT adoption faces a number of obstaclesfaces a number of obstacles

such as absence of power, literacy such as absence of power, literacy among the potential users, technical among the potential users, technical

expertise to support and maintain ICT expertise to support and maintain ICT infrastructure infrastructure

and the major obstacles being poor and the major obstacles being poor telecommunication and lack of Computerstelecommunication and lack of Computers

5.1 Telecommunication5.1 TelecommunicationThere is quite a promising future as deployment of mobile phone infrastructure is moving fast rather than the land lines projectsThere is quite a promising future as deployment of mobile phone infrastructure is moving fast rather than the land lines projects Africa Mobile phone subscribers increased by over 1000% between 1998 and 2003 to reach 51.8 million compared to fixed line, which stood at Africa Mobile phone subscribers increased by over 1000% between 1998 and 2003 to reach 51.8 million compared to fixed line, which stood at 25.1 million at the end of 2003. 25.1 million at the end of 2003. The continent’s rapid mobile sector expansion has been driven by a combination of factors: demand, sector reform, the licensing of new The continent’s rapid mobile sector expansion has been driven by a combination of factors: demand, sector reform, the licensing of new competitioncompetition and the emergence of major strategic investors, such as Vodacom, MTN, Orascom and Celtel [African Telecommunication and the emergence of major strategic investors, such as Vodacom, MTN, Orascom and Celtel [African Telecommunication Indicators 2004]. Indicators 2004].

Developing countries –Developing countries –Telecommunications: 2001Telecommunications: 2001

IndicatorIndicator Developing Developing CountriesCountries

TanzaniaTanzania

Daily newspapers per 1,000 Daily newspapers per 1,000 people (1991/1997)49.13.9people (1991/1997)49.13.9

49.149.1 3.93.9

International Telecom, outgoing International Telecom, outgoing traffic(minutes per subscriber)traffic(minutes per subscriber)

144.4144.4 74.674.6

Mobile phones (per 1,000 Mobile phones (per 1,000 people)people)

1616 5.55.5

Radios(per 1,000 people,1998)Radios(per 1,000 people,1998) 257.2257.2 371.0371.0

Telephone average cost of local Telephone average cost of local call(US $ per three minutes)call(US $ per three minutes)

0.10.1 0.10.1

Telephone mainlines(per 1,000 Telephone mainlines(per 1,000 people)people)

82.182.1 5.35.3

Television sets(per 1,000 people)Television sets(per 1,000 people) 196.5196.5 21.421.4

Source: World Bank Development Indicators (www.worldbank.org)

Mobile Phone usage in AfricaMobile Phone usage in Africa

Global Mobile usersGlobal Mobile users 1.32 Billion1.32 Billion

GSM Usage in AfricaGSM Usage in Africa 95.61 %95.61 %

GSM growth of users in Africa in GSM growth of users in Africa in the past 12 monthsthe past 12 months

101.85%101.85%

Global GSM growth of users in Global GSM growth of users in the past 12 monthsthe past 12 months

52.49 %52.49 %

Total Number of African Total Number of African subscribers (all technologies)subscribers (all technologies)

34.3 Million34.3 Million

The biggest market is in South The biggest market is in South AfricaAfrica

14.4 Million users and 14.4 Million users and expected to 19 Million expected to 19 Million users by 2006users by 2006

Source: BBC Focus in Africa, Jan-March 2004 pp20

5.25.2 ICT Equipment.ICT Equipment.

In order to take advantage of the wireless In order to take advantage of the wireless technology, applications need be developed and technology, applications need be developed and integrated/interfaced to the current systems. integrated/interfaced to the current systems. "Mobile technology is the Information Society in "Mobile technology is the Information Society in Africa", explains Michael Minges, Head of ITU’s Africa", explains Michael Minges, Head of ITU’s Market, Economics and Finance Unit and lead Market, Economics and Finance Unit and lead author of the African Telecommunications author of the African Telecommunications Indicators 2004 report. Indicators 2004 report.

Mobile Phone usage in AfricaMobile Phone usage in Africa

Source: http://www.cellular.co.za/news_2004/may/0501004-itu_says_africa_is_the_world.htm.

5.3 5.3 The Legal frameworkThe Legal framework

There is no adequate legislation to There is no adequate legislation to support electronic transactions support electronic transactions typical of this is the evidence act, typical of this is the evidence act, Bills of exchange act etc to some Bills of exchange act etc to some countriescountries

5.4 The ICT life span5.4 The ICT life span

The changes in ICT happens everyday and at The changes in ICT happens everyday and at certain stage confusing the scheme certain stage confusing the scheme administrators of which technology or solutions administrators of which technology or solutions to adoptto adopt

6. How ICT affects the Structure 6. How ICT affects the Structure and Organisation of Social and Organisation of Social Security AdministratorsSecurity Administrators..

With the adoption of ICT the move is towards With the adoption of ICT the move is towards centralised model office thus enabling centralised model office thus enabling administrators to limit their presence to administrators to limit their presence to every place where they do business. every place where they do business.

While it looks cost effective; the integration of While it looks cost effective; the integration of various ICT applications to support this various ICT applications to support this structure is not a simple onestructure is not a simple one

We can report the impact of ICT on We can report the impact of ICT on organizations in the following key organizations in the following key aspects:aspects:

Efforts of being responsive to changesEfforts of being responsive to changes

Changes to organisation structure Changes to organisation structure changes in decision flows within the organisationchanges in decision flows within the organisation the move towards less physical operations to the move towards less physical operations to

tactical and strategic functionstactical and strategic functions removal of geographical barriers, addition of removal of geographical barriers, addition of

time(24/7/365), culturaltime(24/7/365), cultural changes where globalchanges where global Changes in new directions from operational to core Changes in new directions from operational to core

business functionsbusiness functions..

Impact on decision making and support system Impact on decision making and support system improved accuracyimproved accuracy Greater control and efficiency in decision making process, Greater control and efficiency in decision making process,

MIS.MIS. shorter time frame and quality decision makingshorter time frame and quality decision making data being tailored by relevance to the activities of the data being tailored by relevance to the activities of the

organisationorganisation

Changes to management structures Changes to management structures Organisation adopt flat based against hierarchical Organisation adopt flat based against hierarchical

structures to enhance compatibility of staff to available structures to enhance compatibility of staff to available resources.resources.

The need for effective reallocation of resourcesThe need for effective reallocation of resources OutsourcingOutsourcing

7.07.0 Conclusion.Conclusion.

Automation of business operations generally Automation of business operations generally tends to improve processing speed, accuracy tends to improve processing speed, accuracy and reduced cost per transactionand reduced cost per transaction

It also enables organisations to systematically It also enables organisations to systematically identify, acquire, store, analyse, distribute identify, acquire, store, analyse, distribute and re-use information and knowledge from and re-use information and knowledge from all sources in order to enhance organisational all sources in order to enhance organisational productivity and competitivenessproductivity and competitiveness . .