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For immediate relief, IBM recommends using the JES2 support of the compression of SYSOUT data sets via a keyword on the OUTCLASS statement within JES2. An installation can set up a particular SYSOUT class that does compression, and users would change their JCL to use that provided SYSOUT class or change the existing class to support compression. Additional information can be found here: https://www.ibm.com/docs/en/zos/3.1.0?topic=characteristics-format-description-outclassv
To address the continually increasing diagnostic data volume, IBM recommends using the SYSMDUMP 'interface'. The unformatted data collected by a SYSMDUMP is far smaller (also faster) than the formatted dump outputs. While this must be combined with developing expertise in using IPCS for problem diagnosis; it greatly reduces the volume of data that the system generates at the time of the error.
A separate option is to convert the JCL used to generate the SYSUDUMP/SYSABEND dumps to use data sets instead of a SYSOUT class. We do appreciate that since the data volume is unknown, pre-allocating the data set with a sufficient size could be problematic. With some system planning, it should be possible for SMS allocations with ACS routines to target volumes where the data is compressed, minimizing the impact to DASD utilization.