X-Message-Number: 1312
From: 
Subject: CRYONICS Unbundling comments
Date: Thu, 15 Oct 92 23:12:09 PDT

Re Mark Volker's comments--In general I support the existence of 
cryonics "a la carte," including all the features which have been 
discussed here.  I would like to see this tried in the marketplace, 
and it might turn out that the way Alcor does it is not optimal.  We 
might well see the light after a decade or three and transfer our 
patients (and the funding) to the new and more efficient organization. 
However, I am *very* reluctant (and I think Mark is too) to rush into 
a program to split up Alcor.  We are going to have to think about this 
a lot.  Even if we think we have identified all the pitfalls, I would 
be very concerned about moving to a split organization on a scale of 
less than 5-10 years.  With this in mind, I will go on with comments 
on Mark's clarifications of the idea. 

>Unbundling, Splitting, Strucure of Alcor
>In Cryomsg 1304, Keith posts my thoughts on splitting Alcor into two
>organizations (patient care and suspension/marketing) and follows this
>with further discussions between us. Some comments:

>1) Keith seems to feel that, because the patients would be under the 
>care of an organization other than the one that performs the 
>suspensions, that the living members would no longer care enough to 
>help the patients if the Storage Co. were to get into trouble. Yet 
>these were the same people who, Keith says, would "give till they 
>bleed" if the combined organization were to fail. Which is it? 

There is a difference!  The patients we have now are *Alcor's* 
patients.  The entire prestige of the organization, and the honor of 
the officers and board are at stake, not to mention that letting 
patients thaw out would get the officers and board tarred and 
feathered, and run out of town on a rail by the members.  A really 
disconnected storage organization is a different kettle of fish.  The 
suspension organization would have no authority over the storage 
organization, and no responsibility for their actions.  The same would 
be true in the reverse direction. 

>Futhermore, in my view, the patients would not be shipped off to the 
>Storage Co. and forgotten. The people who have an interest in their 
>welfare (relatives &c.) would have the legal right to monitor the 
>health of the Storage Co. and yank "their" people out of the Storage 
>Co.'s care, if certain well defined warning signs appeared indicating 
>that Storage Co. was not doing its job.  

I am only going on what I know of the history of cryonics.  Relatives 
have proved a weak reed in most cases.  They  reconsider the need to 
keep Gramps in LN2 after a few years when they need the money to send 
a son off to college.  This is where the rule of having all the money 
up front came from.  They also have a tendency to *die*.  And while 
there are counter examples, I am fairly sure that most of the people 
who are in suspension are the sole member of their family involved in 
cryonics.  Go back a year or so in Cryonics and read about Dr. 
Bedford.  His family faithfully took care of him for over a decade, 
but they finally put him into Alcor's care.  They could see a time 
coming where there would be no one left to continue to care for him, 
and none of them became suspension members.  In another few decades, I 
doubt there will be *anyone* outside of Alcor who is willing to check 
on how he is being cared for. 

Take my case, my parents are bitterly opposed to cryonics, and my 
grown kids don't think much of it either. 

>Assuming that the first such 
>warning sign would be "bad odors coming from the dewars" is 
>unwarranted: regular auditing of the booksof Storage Co., and physical 
>inspection of the Patient Care Facility under the terms of the 
>contract between Storage Co. and the patient Reanimation Committee(s) 
>is a more reasonable assumption. 

I am sorry Mark, but even the people *inside* a company often do no 
know when it is about to fail.  I recently acquired a huge heap of 
medical supplies from a bankrupt chain of clinics.  The *employees* 
had no idea there was trouble brewing until the bank came in and 
locked them out.  (I talked to one who was left answering the 
remaining phone.)  I agree that most of the time there would be 
warning, but you have to consider how often businesses fail and how 
little warning they sometimes give of this happening. 

>Nor would this arrangement benefit 
>only patients with enough suspension funding to have individual or 
>family Reanimation Committees: living people who care about patients 
>without such watchdog committees could merely observe the behavior of 
>the committees. If those committees start to remove their patients 
>from the care of Storage Co., this would warn others to investigate 
>further and perhaps prepare to take custody of the other patients. 

:-)  I can see it now, a run on the cryonics bank!

>"Who would want to accept the patients?" The same people in both the 
>bundled and unbundled cases--other cryonicists and relatives of the 
>patients. 

My assumption is the patients would come with little or no funding, 
i.e., the funding being used up would be the primary cause of the 
storage company failure.

Mark, let us assume there are some frozen patients out there who are 
funded month-to-month (I don't know if this is actually is the 
case--or not--at the moment, but it has been in the past.)  Or let us 
assume some patients who for one reason or another have had their 
funds used up.  The relatives quit paying, or resent the fact that 
Aunt Martha used the money which "should" have been willed to them to 
be frozen, and won't pay.  The for-profit storage company is going to 
thaw them out.  These folks were frozen a decade or more ago, and you 
never met them.  Can I hit you up for the several thousand a year it 
takes to keep them frozen?  Would it be responsible for the Alcor 
board to allocate resources for this purpose and take these folks in?  
Even though it reduces the resources we have to keep the patients who 
have *contracted* with us and paid us to keep them frozen?  If we were 
a suspension only organization would it be fair to the clients who 
were signed up with us to use resources (which should go to suspending 
members) to keep these patients frozen?  Want to do some fund raising?  
I will warn you not to try it from the general public.  Tim Leary 
tried to do that once, and was nearly lynched.  Ask me about it 
sometime. 

This is not an entirely hypothetical issue.  I don't know when, and I 
don't know where they will come from, but I would bet that some 
unfunded orphan cases will turn up on our doorstep sometime in the 
next decade or so.  (The most likely case would be a new company yet 
to be formed.)  What are we going to do when that time comes?  I hope 
you have a good idea, because _I don't_. 

>Could Alcor be successfully split (both legally and 
>physically) right now? As Keith says, we have to do some financial and 
>legal analysis to answer that question. Could Alcor's suspension 
>operations subsidize its patient care operations if the patients were 
>threatened right now? No--our patient care fund is "fat" at present; 

The fund is fat only relatively to the demands placed on it.

>it's the suspension/marketing part that's economically marginal. 

Depends--we don't really do any marketing except to make ourselves 
available to the press.  And the advertizing budget is either nil or 
nearly so.  What soaks up the resources is maintaining more of a 
suspension readiness level than is justified for the number of people 
signed up, and the expenses of signing them up.  These and defending 
our right to exist. 

>(Perhaps we need to reconsider the "10% rule".) So there will be 
>pressure to rely on the patient care fund to support the suspension 
>operations. Yet if the suspension operations cease, this is not an 
>irreversible disaster: the people involved can reorganize and go on. 
>This is not the case if patient care operations cease. 

Suspension operations and general overhead are several times as large 
as patient care operations.  Responsible management would reduce our 
level of readiness as needed to stay within the emergency 
responsibility dues and contributions.  At present, patient care 
benefits greatly from sharing suspension operations overhead because 
patient care by itself is way too small a business.  

>As I see it: a) 
>there is risk associated with caring for the patients, b) there is 
>risk associated with performing suspensions, c) the helpless patients 
>should not be exposed to unnecessary risk, d) it has not been shown 
>that concern and support for the patients will be less if they are 
>cared for by a separate organization. Therefore separating the two 
>portions of the cryonics program will enhance the security of the 
>patients. It may also increase the risk of failure of the suspension 
>operation--but such a failure can be recovered from. Yet as I also 
>point out in an earlier posting, unbundling this way is likely to 
>decrease the risk of failure of the suspension portion if the 
>management of the Suspension Co. takes advantage of the increased 
>operating freedom allowed by removing the responsibility for patient 
>care from their shoulders. Unbundling need not be a zero-sum move: 
>both halves of the cryonics enterprise can be managed so as to 
>heighten their chances of success. 

Re point D above, I strongly disagree, and have provided examples of 
my thought process where I arrived at this conclusion.  Re the overall 
point, success in the parts is not equal to what we want--namely to 
come out on the far end of the process.  Neither one of these is a 
"business" in the sense that you measure success by how much money 
they make.  I would like to be able to judge the whole works by how 
many of us can get together for a party in 200 years. 

2) Keith intimates that I committed 
>him to helping me develop a business plan for the Storage Co. My 
>response may be lost to the reader because he prints it further down 
>in the text: I was only acknowledging his advice as help. 

Glad to provide my Wisdom of the Ages (TM)  :-)

>3) Though 
>Keith states that Carlos (as CEO) "heads up" Alcor, I stand by my 
>statement that Alcor is not a "sole proprietorship".

Never said it was.  All corporate organizations--profit and non-profit 
alike--are structured with officers making day-to-day decisions and a 
CEO having authority over officers and staff, with the CEO/officers 
being answerable to the board. 

>Alcor's Board of 
>Directors is responsible for its success or failure. The Board's 
>function is to plan for Alcor's growth 

Long and short range planning, as I have pointed out in a number of 
posts, is not usually considered a function of a board meeting as a  
board.  Staff, sometimes with the help of some or even all of the 
board, figures out plans, which are *approved* by the board.  A board 
as you point out just below, is more often a brake on management, 
tribal elders if you will, keeping the management from going off the 
tracks, and taking responsibility when management does. 

>and hire and evaluate the CEO 
>according to whether these plans are successfully implemented. The 
>Board must also of course evaluate the plans themselves to make sure 
>they are realistic! That in the past the Board has not done this job, 
>and that Carlos has taken on this function, is perhaps the root 
>problem of our organization.

A few comments.  From what I know, the Alcor board and management have 
always had a good idea of just what they are doing.  Keeping the 
patients frozen, and suspending those who need it with as little 
damage as we can manage under the circumstances are the main criteria.  
So, the recurrent operational plan year after year has been just that.  
And, you should remember, Alcor has been in defensive mode for most of 
its activities outside of these two since Carlos started.  Growth-- 
well, if I can ever quit responding to these postings, I have the 
names of the last 50 people who joined Alcor.  I am going to be 
talking to them to see just what brought them in.  We truthfully do 
not know where our new members are coming from--though most of us 
think media attention has a lot to do with it, and personal contact may 
be a big factor. 

I kind of doubt this survey will turn up much that could be used to 
speed up growth, and I am not at all sure we *want* Alcor to grow much 
faster.  Think about the disruptive people the last year or so worth 
of growth has brought in.  We are going to have to develop 
organizational responses which can deal with these kinds of problems.  
Any faster growth might well overwhelm us.

Finally, steady manageable growth, finances which we can live with, 
and closing out the legal battles with wins on the really important 
cases . . . . There are a lot of organizations which would swap their 
problems for ours!

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