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1. Delaware Secretary of State, Division of Corporations Imaging System
Summary
Although Delaware is one of our smallest states, it is home to approximately 300,000 corporations. How can such a small state have such a concentration of corporate power? That apparent contradiction is possible because few of those companies have either headquarters, offices, or plants in the state. The companies simply are registered there.
Corporate registry and franchise tax services are big business in Delaware. Together they bring in approximately $300 million in annual revenue to the state's government. This represents a sizable part of the government's annual revenue of about $1 billion.
The Division of Corporations, within the Delaware Secretary of State's office, registers corporations. Corporate registry includes creation and dissolution of companies, corporate mergers and acquisitions, stock and bond issuance, actions involving limited partnerships, and changes in corporate constitutions. The division also issues franchise tax bills, collects the taxes, and maintains the tax records. A vast amount of recordkeeping and correspondence go with these corporate services, and where recordkeeping and correspondence go, imaging usually follows.
Imaging enables the division to give its corporate clients better service through more rapid and accurate transaction (i.e., request for services) processing, inquiry responses, and output production. The imaging system receives information from clients or their authorized agents, enters it into the mainframe-based Delaware Corporate Information System (DCIS), and prepares and groups documents received from DCIS for output to the clients or agents.
The Division of Corporations imaging system has several exemplary features. It allows input by either remote scanning from agents' offices, local scanning in the division, or facsimile transmission (fax) from agents' or clients' offices. It uses a sophisticated workflow formula to assign workers to requests based on a worker's capability and a request's priority. And it creates output packages from DCIS print files that formerly generated disparate output on several printers.
Courts share with the Division of Corporations many of the needs that make these features so useful. First, courts enter information into case processing systems from numerous sources. Some documents are submitted directly to the clerk's office, and these could be scanned into the system locally. Other documents come from external sources--such as attorneys, law enforcement, probation, pretrial diversion, and community services. These documents could be scanned into the system remotely, or the documents could be faxed to the clerk. Second, many of the documents produced by courts contain signatures, seals, letterheads, and other inscriptions. When the imaging system groups output into print packages, it can superimpose text on templates that contain signatures, seals, letterheads, and other inscriptions to produce excellent-quality official documents. This would be a major benefit to courts. Finally, many clerk's offices, particularly the larger ones, have various options for document processing, and a workflow formula would assist in getting work to the proper workstation.
Division of Corporations staff say the imaging system is “definitely worth” the $5 million it cost. They feel the system has dramatically improved the service the division gives clients in Delaware's crucial corporate registry “business.”
After four years in operation, the system has almost outgrown the two Wang minicomputers on which it runs. The Delaware Legislature and Secretary of State approved funding for a larger computer, and the Division of Corporations is procuring the computer now.
Information on the imaging system was provided by Mr. Bob Kasman, a consultant on long-term assignment at the Division of Corporations. Mr. Kasman, Mr. Jim Ravis, the project leader, and Mr. Philip Fred, a software specialist comprised the imaging system development team. Messrs. Ravis and Fred are employees of the state computing and information services agency. At the time of the imaging system development, Mr. Kasman was a software specialist with Wang. We appreciate their assistance.
Enterprise Description
In addition to its corporate registry and franchise tax functions, the Delaware Secretary of State Division of Corporations provides archiving service for other state agencies, issues and maintains trademarks, maintains notary public lists, and maintains records of uniform commercial code filings. The division has about 100 employees, most of whom work in the imaging operation. Its address and telephone number are
Townsend Building
Federal and Duke of York Streets
Dover, DE 19901
302-739-4111.
Generally, in corporate registry, the division works through registered agents and not directly with the corporations. There are about ten such agents. The division charges the corporations different fees for different types of service, with most fees based on turnaround time requested by the corporation or agent.
Within Delaware state government, the head of the Division of Corporations reports to the Secretary of State, who reports to the Governor. The head of the Division of Corporations has the title of Assistant Secretary of State. The Office of Information Services (OIS) is the state computing and information services agency and supports the Secretary of State as well as other state agencies.
Seven OIS technical staff provide on-site support for the imaging system at the Division of Corporations. OIS runs the state mainframe computer, and like other agencies, the Secretary of State rents time on it. The minicomputers and their accessories on which the imaging system runs are owned by the Secretary of State.
Imaging Application
Overview
In early 1989, the Secretary of State realized something had to be done to improve the service given to corporations. Most processing was manual, records were microfilmed after a request had been completed, and mainframe files contained corporate histories so that records could be correlated. The Division of Corporations was plagued by all the symbols of such an operation: piecemeal filing; piles of paper on desks; six to nine months turnaround time to complete a request; inability to track work in progress; excessive staff overtime; and loss of documents. This low-quality, inefficient, and labor-intensive operation translated into one major liability: poor service to the corporations whose “business” means so much to Delaware.
In early 1989 the Secretary of State set out to improve this situation. Suspecting imaging was at least part of the solution, he arranged for Wang and MECA Group to analyze the Division of Corporations requirements. The analysis included processing volumes; storage, formatting, and legal requirements; OIS mainframe communications; staffing; management; and costs. At this early stage, and throughout the project, work proceeded with heavy management, user, and technical staff participation. Armed with the requirements analysis and approval from the Attorney General and OIS, the Secretary of State and Division of Corporations went to the Legislature and obtained funding. They then planned the development, implementation, training, and conversion and proceeded to execute their plans. The Division of Corporations began to use the imaging system in June 1990, and the system was fully operational and had passed all acceptance tests by the fall of 1990.
In performing request processing and DCIS entry, the imaging system receives requests either automatically from faxed documents or from locally or remotely scanned documents. It applies a sophisticated workflow formula to separate each request into work units and route the request to the appropriate workstation. The formula causes requests to be routed based on priority, document type, and qualifications of Division of Corporations users available to work on them. Imaging system screens are divided into four quadrants that enable users to work with the imaging system, retrieve data from and enter data into DCIS, and view current and historical document images. As users complete work, the system applies the workflow formula to retrieve the next request.
In grouping outputs into print packages to respond to a specific request, the imaging system receives print files from DCIS and superimposes the print file contents on preimaged templates that contain the necessary inscriptions and signatures. Then the system prints the package, creating official papers and supporting documents.
The imaging system supports the Division of Corporations franchise tax processing by scanning, indexing, and storing tax billing and payment information.
The imaging system runs on dual Wang minicomputers (VS-8480 and VS-12000) with 64 million characters of memory each. The system runs under Wang operating system and imaging software. Support software includes:
- Cobol programming language;
- Pace, which is Wang's database management software;
- Adabas database software, which also is the mainframe's database management system;
- Natural, which is the high-level programming language used with Adabas;
- Wang communications software;
- Wang office automation and word processing systems; and
- Software from MSG to superimpose (“forms flash”) text on imaged templates.
Collectively, the minicomputers have three system printers; a variety of other printers for local work; approximately 13 billion characters of disk storage; a Cygnet optical jukebox; several tape units; three Wang scanners; a high-speed Kodak scanner; several communications controllers and modems; and fax, optical character recognition (OCR), and voice processors.
There are approximately 85 PC workstations with Wang image terminal emulation software, and these currently are being replaced by more powerful PCs running under Microsoft Windows.
The OIS mainframe is an IBM 3090.
As shown in the Network Diagram (see Figure A - 1), several types of communications exist to connect the parts of the imaging system to each other and to the mainframe. The principal networks used in imaging are SNA, which connects the minicomputers and the mainframe; an Ethernet connection between the minicomputers; Wangnet, which is the communications backbone between the minicomputers and the PCs; and Banyan's Vines between the Kodak scanner, its workstations, and the minicomputers. In summary, connections exist between:
- The two minicomputers;
- The minicomputers and the OIS mainframe;
Figure A - 1: State of Delaware--Division of Corporations Network Diagram
- The minicomputers and special-purpose PC workstations linked to the Kodak scanner used to enter franchise tax documents;
- The minicomputers and a special-purpose PC used to enter faxed documents;
- The minicomputers and a special-purpose PC used to perform OCR;
- The minicomputers and a special-purpose PC used to enter documents scanned remotely;
- The minicomputers and special-purpose PCs used to enter documents scanned locally;
- The minicomputers and PCs used by most Division of Corporations users for request processing; and
- The standard state office automation network that embraces the mainframe and most PCs.
On a typical day, the imaging system receives about 1,300 pages from all sources, processes approximately 500 service requests, and produces about 350 print packages.
Planning, Implementation, and Management
The overriding objective as the Secretary of State ventured into imaging was improved service to corporations. If imaging did not accomplish this, the state risked loss of revenue and degradation of its preeminent position in corporate registry.
The Secretary of State and Division of Corporations addressed these concerns by involving managers, users, and technical staff in each part of the imaging system project; carefully planning for imaging; and by adhering to a disciplined, but flexible, execution of the plan, adopting improvements along the way.
At the beginning of the imaging project, the Secretary of State and Division of Corporations established the following design criteria for the system:
- It would not require changes in the OIS mainframe equipment;
- It would run independently of, but communicate with, the mainframe;
- It would contain a workflow capability whereby, (1) requests could be routed to any Secretary of State employee based on a prearranged formula, and (2) each request could be tracked to identify its status; and
- It would reduce request turnaround time, the use of paper, and the need for operator intervention.
The imaging system was developed by a combination of OIS and Wang personnel. OIS completed the workflow capability, programmed in Adabas Natural, by the middle of 1990, and Wang completed the print packaging capability, programmed in Pace Cobol, by the end of 1990.
By the end of 1989, enough programming had been completed for data conversion to begin. Using a contractor hired specifically for the conversion, an off-site operation was established to convert the microfilm records onto paper so that poor-quality documents could be enhanced and successfully scanned onto cartridges. Then the cartridges were transported to the Division of Corporations and entered into the new system. The massive volume of pages to be converted--about 6,000,000 initially and 4,000,000 after unnecessary pages had been eliminated--led to an around-the-clock operation. The off-site approach was chosen for most of the conversion to minimize disruption of normal client services. All documents in the old system had been converted by April 1990, and random samples revealed this was accomplished with 99 percent accuracy.
To realize the full benefit of the imaging workflow capability, Division of Corporations users adopted a radically different approach to handling service requests. Before imaging, a user addressed one discrete part of request processing. The imaging system induced each user to become aware of, and to achieve a level of proficiency in, each part of request processing.
A prototype of the workflow capability gave users exposure to the imaging system in early 1990 and was so successful that, with minor changes, the prototype became the heart of the actual system. Then the other major part of the system--print packaging--was completed, and enhancements to both parts continue to this day as opportunities for improved service arise.
Recurring issues for the Division of Corporations are the following:
- Legal issues in imaging regarding acceptability of various storage media, definition of what constitutes a legal image, validity of modified images, access privileges, and backup storage requirements;
- Access frequency issues that dictate whether documents of a certain type should be imaged or microfilmed;
- Technology issues regarding how to allow for the changes and improvements (e.g., in image storage formats) that are inevitable in computers, communications, and imaging;
- Communications issues regarding how to set up networks given the geographical dispersion of the corporations and their agents; and
- Standards issues regarding how to address changing industry standards in areas such as image storage, fax transmissions, databases, image displays, and printed output.
While Secretary of State and Division of Corporations management exercises overall control of the imaging system, the workflow supervisors and their first-line managers control day-to-day operations. Working closely with Division of Corporations management, OIS supervises the technical support group.
Operation and Maintenance
The imaging system runs for two shifts each workday. File and system housekeeping runs begin on the second shift and continue without operator presence into the third shift. Division of Corporations supervisors diagnose and correct most minor problems. On-site OIS personnel handle more serious problems.
Advantages and Disadvantages
The Division of Corporations has derived the following benefits from imaging:
- Corporations receive improved service;
- A three-month request backlog has been eliminated;
- Approximately $300,000 has been saved by reduced overtime;
- User personnel have been reduced by almost 25 percent; and
- The staff and their work environment have become more professional.
Division of Corporations staff cite no problems or disadvantages with the imaging system other than the usual difficulties in connecting the system's numerous and varied types of equipment and communications and making sure they remain fully operational.
The Future
In the next year, as part of a continuing program of improvements, the Division of Corporations plans to obtain badly needed computer capacity by upgrading the Wang imaging system computers to a Hewlett-Packard HP 9000. It also plans to modernize the software and communications by installing the Unix operating system on the HP, installing Windows on the PCs, and adopting the TCP/IP standard for the networks. This will permit:
- Satisfaction of existing needs in addition to allowing for more storage and a 15 percent increase in the number of corporate users;
- A wider variety of outputs;
- Addition of imaging system software, equipment, and communications functionality as the need arises and technology becomes available;
- More straightforward communications;
- More modern image storage standards;
- Easier system maintenance;
- Open operability (i.e., without special-purpose connections) with other existing and emerging technologies; and
- Easier data sharing between the computers that perform imaging functions (e.g., imaging computer and mainframe).
The Division of Corporations plans to install the existing imaging system software on the new computer and then move to a client-server network, with the HP 9000 as the server and the PCs as clients.
In the next two to five years, the division plans to
- Permit all registered agents to send requests directly into the imaging system workflow using fax or remote scanning;
- Give all registered agents on-line access to stored images;
- Fully integrate uniform commercial code (UCC) filings into the corporations workflow and provide on-line access to Delaware banks, law firms, corporations, and registered agents for UCC filings;
- Provide more extensive incoming fax capabilities as well as credit card and outgoing fax capabilities;
- Open a full-function satellite office in Wilmington;
- Allow electronic filing; and
- Expand to a 24-hour operation to allow for international companies and agents.
Detailed System Description
Client requests enter the imaging system in three ways: automatic entry of fax from clients; direct entry of images scanned remotely at an agent's workstation; and entry of images scanned locally at the Division of Corporations. The objective is to get the images into the workflow and enter their contents into DCIS.
Faxed images undergo an OCR process on a dedicated personal computer to extract the priority and document type (corporate filings, corporate certifications, uniform commercial code filings) from the cover page. The Wang minicomputers use this information to create a master control sequence (MCS) workflow record for the group of images.
Since local and remote scanning are done during a personal computer session, the priority and document type are key-entered and routed to the Wang minicomputers. The OCR process is unnecessary in this situation.
The MCS workflow record, with the MCS number as its key, controls workflow processing on the Wang minicomputers. Whereas the MCS identifies a specific transmission, service request (SRV) numbers define the work requested in the transmission. Each MCS package contains one or more requests for work. During remote scanning sessions, agents assign SRV numbers. Otherwise, Division of Corporations users assign SRV numbers to faxed and locally entered requests.
At this point, the user verifies information entered with remotely scanned documents, creates an SRV workflow record for all documents, and groups the SRV workflow record with the associated document images and locations in the system.
The system applies a formula that assigns a Division of Corporations user to work on each task within the SRV. For each user, the system contains a record that specifies the priorities and types of documents (e.g., initial notice, incorporating, and resignation of agent) on which the user is qualified to work. Another record groups each document by the type of work necessary to process the document (e.g., cash management, certificate issue, and new company processing) and, within each work type, the level of complexity. The system, therefore, defines the document types, maximum priority, and maximum level of complexity each user can work on and, unless overridden by the supervisor, assigns work accordingly. As a user completes work, the system checks the work queue for work of an equal or higher priority that the user is qualified to work on and, if none is found, goes to lower-priority work. The above processing is shown in Figure A - 2.
When performing work on a request, the user sees a screen divided into four parts, called windows. The top left quadrant is the window in which the corporations workflow application appears. This controls work that the system brings before the user as well as operations performed on the images--such as affixing official stamps, deleting unnecessary imaged pages in the request, creating print packages, assigning SRV numbers, and making entries in workflow records as work proceeds. The bottom left quadrant is the window in which the user works with the mainframe DCIS. Data can be key-entered or moved into the DCIS database for the corporation to which the request applies, and information in the database can be reviewed and modified. The two quadrants on the right contain images used in processing the work request. One of these quadrants displays images for work underway, and the other shows images of historical documents.
DCIS output resulting from requests includes certificates attesting to the filing of various corporate documents, invoices for the services performed by the Division of Corporations, word processing documents on state letterhead, and other types of documents. Generally, each group of output consists of at least an invoice, a certificate, and several pages of images of filed or historical documents. Outputs can originate in many places within the mainframe and can be output to numerous devices. So that users do not have to run from device to device for the outputs to a given request, system outputs are grouped into print files on the mainframe and downloaded to the imaging system. There, each output is superimposed on the appropriate template (e.g., certificates, franchise tax documents, invoices, and images of the documents submitted with the request) and printed to obtain the package needed to respond to the request. This Wang-based capability is known as print packaging. Examples of the output are given in Figure A - 3 and Figure A - 4 (Figure 3 in Chapter One shows another example).
Figure A - 2: Delaware Corporation Filings -- Database Entities
Whereas most documents are added to the workflow, initiate specific actions on corporate records, initiate DCIS database updates, and generate specific outputs, franchise taxes are handled differently. These taxes are paid by the franchisee in response to bills generated by DCIS. The money is deposited, and the bills and related information are stored in a lock box. Later, the bills and a transaction log are sent to the Division of Corporations, where they are scanned into the imaging system using the high-speed Kodak scanner. Then the franchisee's bar code is added to the scanned material, and the package is indexed and archived on optical disk in the imaging system.
As described earlier, the imaging system consists of dual minicomputers, PCs, peripheral equipment, communications, imaging software, systems software, and support software. The equipment and software perform most of the functions described above. The mainframe, on which DCIS resides, primarily provides database management and report file generation for information uploaded from or downloaded to the imaging system. For example, the mainframe creates, maintains, and updates files; verifies information contained in service requests; downloads information as needed for workflow management and processing; and assembles information to be included in print packages and downloads it to the imaging system.
Figure A - 3: Invoice Produced Through "Print Packaging"
Conclusions
In the Delaware Secretary of State Division of Corporations, the overriding purpose for imaging was to improve service. The imaging system has enabled the Division of Corporations to improve service dramatically and will continue to do so as the division searches for ways to use technology for even better corporate service.
As noted above, the following three aspects of the Division of Corporations imaging system would interest courts:
- Images automatically enter the system by fax or by local or remote scanning;
- The system produces excellent-quality official documents by superimposing text on imaged templates that contain signatures, seals, letterheads, and other inscriptions; and
- The system has a workflow formula with various options for document processing to assist in getting work to the proper workstation.
Figure A - 4: Certificate Produced Through "Print Packaging"
