I enjoy reading Ken Hanley’s articles. In response to his column “Allowing for exceptions can be costly” (Jan. 11, page 20), my company and my students have done much research in exception management in relation to Internet banking and commerce.
In a typical commerce system as many as 70 per cent of all transactions might involve some error or change or request for help or training, registration, exchange, return, non-payment, address change, etc., which requires exception management.
The costs of exception management in a mature transactional system is as much as 94 per cent of the cost of an average transaction. In other words, you can as well give a “system built to handle the 98 per cent of circumstances” for free, as the cost of exception management is always close to the overall cost of the “caring” system itself, its maintenance, etc., etc. We don’t see it only because most of the systems that we develop at this stage are far immature to be of much use. Neglect of exception management is one of the key reasons for the fall of dot-com economy. I’m sure in several years our approach will change radically.
The bottom line is that handling routine transactions is just a commodity issue and hence can usually be outsourced. A robust transactional system should be built first and foremost to handle exceptions.
I’ll place Ken’s article as a valuable resource for my students.
Nahum Goldmann, ARRAY Development, Ottawa, and School of Management, University of Ottawa.