DCLGEN will generate COBOL variable map for the table you want to access. The picture caluse of the variable will be decided upon the type of variable in table.
CHAR 20 in Db2 ,will be PIC X(20) in COBOL
DCLGEN MEANS :DECLARATION GENERATOR
This is use when you go for db2-cobol prorame
The Dclgen create the host variable structure
Host variable nothing but the variable use for passing or taking the input value it alwyas represent :host variable in procedure division
dclgen is not compulsory thing you can also write the host variable manually but for exact struture generation for checking for column the dclgen is easy way