Shop Management Part 2

It appears to me, however, that "drifting" very accurately describes it, for the reason that the management, having turned over the entire control of the speed problem to the men, the latter being influenced by their prejudices and whims, drift sometimes in one direction and sometimes in another; but on the whole, sooner or later, under the stimulus of the premium, move toward a higher rate of speed. This drifting, accompanied as it is by the irregularity and uncertainty both as to the final result which will be attained and as to how long it will take to reach this end, is in marked contrast to the distinct goal which is always kept in plain sight of both parties under task management, and the clear-cut directions which leave no doubt as to the means which are to be employed nor the time in which the work must be done; and these elements const.i.tute the fundamental difference between the two systems.

Mr. Halsey, in objecting to the use of the word "drifting" as describing his system, has referred to the use of his system in England in connection with a "rate-fixing" or planning department, and quotes as follows from his paper to show that he contemplated control of the speed of the work by the management:

"On contract work undertaken for the first time the method is the same except that the premium is based on the estimated time for the execution of the work."

In making this claim Mr. Halsey appears to have entirely lost sight of the real essence of the two plans. It is task management which is in use in England, not the Towne-Halsey system; and in the above quotation Mr.

Halsey describes not his system but a type of task management, in which the men are paid a premium for carrying out the directions given them by the management.

There is no doubt that there is more or less confusion in the minds of many of those who have read about the task management and the Towne-Halsey system. This extends also to those who are actually using and working under these systems. This is practically true in England, where in some cases task management is actually being used under the name of the "Premium Plan." It would therefore seem desirable to indicate once again and in a little different way the essential difference between the two.

The one element which the Towne-Halsey system and task management have in common is that both recognize the all-important fact that workmen cannot be induced to work extra hard without receiving extra pay. Under both systems the men who succeed are daily and automatically, as it were, paid an extra premium. The payment of this daily premium forms such a characteristic feature in both systems, and so radically differentiates these systems from those which were in use before, that people are apt to look upon this one element as the essence of both systems and so fail to recognize the more important, underlying principles upon which the success of each of them is based.

In their essence, with the one exception of the payment of a daily premium, the systems stand at the two opposite extremes in the field of management; and it is owing to the distinctly radical, though opposite, positions taken by them that each one owes its success; and it seems to me a matter of importance that this should be understood. In any executive work which involves the cooperation of two different men or parties, where both parties have anything like equal power or voice in its direction, there is almost sure to be a certain amount of bickering, quarreling, and vacillation, and the success of the enterprise suffers accordingly. If, however, either one of the parties has the entire direction, the enterprise will progress consistently and probably harmoniously, even although the wrong one of the two parties may be in control.

Broadly speaking, in the field of management there are two parties--the superintendents, etc., on one side and the men on the other, and the main questions at issue are the speed and accuracy with which the work shall be done. Up to the time that task management was introduced in the Midvale Steel Works, it can be fairly said that under the old systems of management the men and the management had about equal weight in deciding how fast the work should be done. Shop records showing the quickest time in which each job had been done and more or less shrewd guessing being the means on which the management depended for bargaining with and coercing the men; and deliberate soldiering for the purpose of misinforming the management being the weapon used by the men in self-defense. Under the old system the incentive was entirely lacking which is needed to induce men to cooperate heartily with the management in increasing the speed with which work is turned out. It is chiefly due, under the old systems, to this divided control of the speed with which the work shall be done that such an amount of bickering, quarreling, and often hard feeling exists between the two sides.

The essence of task management lies in the fact that the control of the speed problem rests entirely with the management; and, on the other hand, the true strength of the Towne-Halsey system rests upon the fact that under it the question of speed is settled entirely by the men without interference on the part of the management. Thus in both cases, though from diametrically opposite causes, there is undivided control, and this is the chief element needed for harmony.

The writer has seen many jobs successfully nursed in several of our large and well managed establishments under these drifting systems, for a term of ten to fifteen years, at from one-third to one-quarter speed.

The workmen, in the meanwhile, apparently enjoyed the confidence of their employers, and in many cases the employers not only suspected the deceit, but felt quite sure of it.

The great defect, then, common to all the ordinary systems of management (including the Towne-Halsey system, the best of this cla.s.s) is that their starting-point, their very foundation, rests upon ignorance and deceit, and that throughout their whole course in the one element which is most vital both to employer and workmen, namely, the speed at which work is done, they are allowed to drift instead of being intelligently directed and controlled.

The writer has found, through an experience of thirty years, covering a large variety in manufactures, as well as in the building trades, structural and engineering work, that it is not only practicable but comparatively easy to obtain, through a systematic and scientific time study, exact information as to how much of any given kind of work either a first-cla.s.s or an average man can do in a day, and with this information as a foundation, he has over and over again seen the fact demonstrated that workmen of all cla.s.ses are not only willing, but glad to give up all idea of soldiering, and devote all of their energies to turning out the maximum work possible, providing they are sure of a suitable permanent reward.

With accurate time knowledge as a basis, surprisingly large results can be obtained under any scheme of management from day work up; there is no question that even ordinary day work resting upon this foundation will give greater satisfaction than any of the systems in common use, standing as they do upon soldiering as a basis.

To many of the readers of this book both the fundamental objects to be aimed at, namely, high wages with low labor cost, and the means advocated by the writer for attaining this end; namely, accurate time study, will appear so theoretical and so far outside of the range of their personal observation and experience that it would seem desirable, before proceeding farther, to give a brief ill.u.s.tration of what has been accomplished in this line.

The writer chooses from among a large variety of trades to which these principles have been applied, the yard labor handling raw materials in the works of the Bethlehem Steel Company at South Bethlehem, Pa., not because the results attained there have been greater than in many other instances, but because the case is so elementary that the results are evidently due to no other cause than thorough time study as a basis, followed by the application of a few simple principles with which all of us are familiar.

In almost all of the other more complicated cases the large increase in output is due partly to the actual physical changes, either in the machines or small tools and appliances, which a preliminary time study almost always shows to be necessary, so that for purposes of ill.u.s.tration the simple case chosen is the better, although the gain made in the more complicated cases is none the less legitimately due to the system.

Up to the spring of the year 1899, all of the materials in the yard of the Bethlehem Steel Company had been handled by gangs of men working by the day, and under the foremanship of men who had themselves formerly worked at similar work as laborers. Their management was about as good as the average of similar work, although it was bad all of the men being paid the ruling wages of laborers in this section of the country, namely, $1.15 per day, the only means of encouraging or disciplining them being either talking to them or discharging them; occasionally, however, a man was selected from among these men and given a better cla.s.s of work with slightly higher wages in some of the companies'

shops, and this had the effect of slightly stimulating them. From four to six hundred men were employed on this cla.s.s of work throughout the year.

The work of these men consisted mainly of unloading from railway cars and shoveling on to piles, and from these piles again loading as required, the raw materials used in running three blast furnaces and seven large open-hearth furnaces, such as ore of various kinds, varying from fine, gravelly ore to that which comes in large lumps, c.o.ke, limestone, special pig, sand, etc., unloading hard and soft coal for boilers gas-producers, etc., and also for storage and again loading the stored coal as required for use, loading the pig-iron produced at the furnaces for shipment, for storage, and for local use, and handling billets, etc., produced by the rolling mills. The work covered a large variety as laboring work goes, and it was not usual to keep a man continuously at the same cla.s.s of work.

Before undertaking the management of these men, the writer was informed that they were steady workers, but slow and phlegmatic, and that nothing would induce them to work fast.

The first step was to place an intelligent, college-educated man in charge of progress in this line. This man had not before handled this cla.s.s of labor, although he understood managing workmen. He was not familiar with the methods pursued by the writer, but was soon taught the art of determining how much work a first-cla.s.s man can do in a day. This was done by timing with a stop watch a first-cla.s.s man while he was working fast. The best way to do this, in fact almost the only way in which the timing can be done with certainty, is to divide the man's work into its elements and time each element separately. For example, in the case of a man loading pig-iron on to a car, the elements should be: (a) picking up the pig from the ground or pile (time in hundredths of a minute); (b) walking with it on a level (time per foot walked); (c) walking with it up an incline to car (time per foot walked); (d) throwing the pig down (time in hundredths of a minute), or laying it on a pile (time in hundredths of a minute); (e) walking back empty to get a load (time per foot walked).

In case of important elements which were to enter into a number of rates, a large number of observations were taken when practicable on different first-cla.s.s men, and at different times, and they were averaged.

The most difficult elements to time and decide upon in this, as in most cases, are the percentage of the day required for rest, and the time to allow for accidental or unavoidable delays.

In the case of the yard labor at Bethlehem, each cla.s.s of work was studied as above, each element being timed separately, and, in addition, a record was kept in many cases of the total amount of work done by the man in a day. The record of the gross work of the man (who is being timed) is, in most cases, not necessary after the observer is skilled in his work. As the Bethlehem time observer was new to this work, the gross time was useful in checking his detailed observations and so gradually educating him and giving him confidence in the new methods.

The writer had so many other duties that his personal help was confined to teaching the proper methods and approving the details of the various changes which were in all cases outlined in written reports before being carried out.

As soon as a careful study had been made of the time elements entering into one cla.s.s of work, a single first-cla.s.s workman was picked out and started on ordinary piece work on this job. His task required him to do between three and one-half and four times as much work in a day as had been done in the past on an average.

Between twelve and thirteen tons of pig-iron per man had been carried from a pile on the ground, up an inclined plank, and loaded on to a gondola car by the average pig-iron handler while working by the day.

The men in doing this work had worked in gangs of from five to twenty men.

The man selected from one of these gangs to make the first start under the writer's system was called upon to load on piece work from forty-five to forty-eight tons (2,240 lbs. each) per day.

He regarded this task as an entirely fair one, and earned on an average, from the start, $1.85 per day, which was 60 per cent more than he had been paid by the day. This man happened to be considerably lighter than the average good workman at this cla.s.s of work. He weighed about 130 pounds. He proved however, to be especially well suited to this job, and was kept at it steadily throughout the time that the writer was in Bethlehem, and some years later was still at the same work.

Being the first piece work started in the works, it excited considerable opposition, both on the part of the workmen and of several of the leading men in the town, their opposition being based mainly on the old fallacy that if piece work proved successful a great many men would be thrown out of work, and that thereby not only the workmen but the whole town would suffer.

One after another of the new men who were started singly on this job were either persuaded or intimidated into giving it up. In many cases they were given other work by those interested in preventing piece work, at wages higher than the ruling wages. In the meantime, however, the first man who started on the work earned steadily $1.85 per day, and this object lesson gradually wore out the concerted opposition, which ceased rather suddenly after about two months. From this time on there was no difficulty in getting plenty of good men who were anxious to start on piece work, and the difficulty lay in making with sufficient rapidity the accurate time study of the elementary operations or "unit times" which forms the foundation of this kind of piece work.

Throughout the introduction of piece work, when after a thorough time study a new section of the work was started, one man only was put on each new job, and not more than one man was allowed to work at it until he had demonstrated that the task set was a fair one by earning an average of $1.85 per day. After a few sections of the work had been started in this way, the complaint on the part of the better workmen was that they were not allowed to go on to piece work fast enough. It required about two years to transfer practically all of the yard labor from day to piece work. And the larger part of the transfer was made during the last six months of this time.

As stated above, the greater part of the time was taken up in studying "unit times," and this time study was greatly delayed by having successively the two leading men who had been trained to the work leave because they were offered much larger salaries elsewhere. The study of "unit times" for the yard labor took practically the time of two trained men for two years. Throughout this time the day and piece workers were under entirely separate and distinct management. The original foremen continued to manage the day work, and day and piece workers were never allowed to work together. Gradually the day work gang was diminished and the piece workers were increased as one section of work after another was transformed from the former to the latter.

Two elements which were important to the success of this work should be noted:

First, on the morning following each day's work, each workman was given a slip of paper informing him in detail just how much work he had done the day before, and the amount he had earned. This enabled him to measure his performance against his earnings while the details were fresh in his mind. Without this there would have been great dissatisfaction among those who failed to climb up to the task asked of them, and many would have gradually fallen off in their performance.

Second, whenever it was practicable, each man's work was measured by itself. Only when absolutely necessary was the work of two men measured up together and the price divided between them, and then care was taken to select two men of as nearly as possible the same capacity. Only on few occasions, and then upon special permission, signed by the writer, were more than two men allowed to work on gang work, dividing their earnings between them. Gang work almost invariably results in a failing off in earnings and consequent dissatisfaction.

An interesting ill.u.s.tration of the desirability of individual piece work instead of gang work came to our attention at Bethlehem. Several of the best piece workers among the Bethlehem yard laborers were informed by their friends that a much higher price per ton was paid for shoveling ore in another works than the rate given at Bethlehem. After talking the matter over with the writer he advised them to go to the other works, which they accordingly did. In about a month they were all back at work in Bethlehem again, having found that at the other works they were obliged to work with a gang of men instead of on individual piece work, and that the rest of the gang worked so slowly that in spite of the high price paid per ton they earned much less than Bethlehem.

Table 1, on page 54, gives a summary of the work done by the piece-work laborers in handling raw materials, such as ores, anthracite and bituminous coal, c.o.ke, pig-iron, sand, limestone, cinder, scale, ashes, etc., in the works of the Bethlehem Steel Company, during the year ending April 30, 1900. This work consisted mainly in loading and unloading cars on arrival or departure from the works, and for local transportation, and was done entirely by hand, i.e., without the use of cranes or other machinery.

The greater part of the credit for making the accurate time study and actually managing the men on this work should be given to Mr. A. B.

Wadleigh, the writer's a.s.sistant in this section at that time.

TABLE 1. -SHOWING RELATIVE COST OF YARD LABOR UNDER TASK PIECE WORK AND OLD STYLE DAY WORK

[Transcriber's note -- table 1 omitted]

When the writer left the steel works, the Bethlehem piece workers were the finest body of picked laborers that he has ever seen together. They were practically all first-cla.s.s men, because in each case the task which they were called upon to perform was such that only a first-cla.s.s man could do it. The tasks were all purposely made so severe that not more than one out of five laborers (perhaps even a smaller percentage than this) could keep up.

[Footnotes to table 1]

1) It was our intention to fix piece work rates which should enable first-cla.s.s workmen to average about 60 per cent more than they had been earning on day work, namely $1.85 per day. A year's average shows them to have earned $1.88 per day, or three cents per man per day more than we expected--an error of 1 6/10 per cent.

2) The piece workers handled on an average 3 56/100 times as many tons per day as the day workers.

[end footnotes to table 1]

It was clearly understood by each newcomer as he went to work that unless he was able to average at least $1.85 per day he would have to make way for another man who could do so. As a result, first-cla.s.s men from all over that part of the country, who were in most cases earning from $1.05 to $1.15 per day, were anxious to try their hands at earning $1.85 per day. If they succeeded they were naturally contented, and if they failed they left, sorry that they were unable to maintain the proper pace, but with no hard feelings either toward the system or the management. Throughout the time that the writer was there, labor was as scarce and as difficult to get as it ever has been in the history of this country, and yet there was always a surplus of first-cla.s.s men ready to leave other jobs and try their hand at Bethlehem piece work.

Perhaps the most notable difference between these men and ordinary piece workers lay in their changed mental att.i.tude toward their employers and their work, and in the total absence of soldiering on their part. The ordinary piece worker would have spent a considerable part of his time in deciding just how much his employer would allow him to earn without cutting prices and in then trying to come as close as possible to this figure, while carefully guarding each job so as to keep the management from finding out how fast it really could be done.

These men, however, were faced with a new but very simple and straightforward proposition, namely, am I a first-cla.s.s laborer or not?

Each man felt that if he belonged in the first cla.s.s all he had to do was to work at his best and he would be paid sixty per cent more than he had been paid in the past. Each piece work price was accepted by the men without question. They never bargained over nor complained about rates, and there was no occasion to do so, since they were all equally fair, and called for almost exactly the same amount of work and fatigue per dollar of wages.