Gestão Eficaz em Ambientes Competitivos: Análise e Indicadores

The most severe trial to which any system can be subjected is that of a business which is in keen competition over a large territory and in which the labor cost of production forms a large element of the expense and it is in such establishments that one would naturally expect to find the best type of management Yet it is an interesting fact that in several of the largest and most important classes of industries in this country shop practice is still twenty to thirty years behind what might be called modern management Not only is no attempt made by them to do tonnage or piece work but the oldest of oldfashioned day work is still in vogue under which one overworked foreman manages the men The workmen in these shops are still herded in classes all of those in a class being paid the same wages regardless of their respective efficiency In these industries however although they are keenly competitive the poor type of shop management does not interfere with dividends since they are in this respect all equally bad It would appear therefore that as an index to the quality of shop management the earning of dividends is but a poor guide Any one who has the opportunity and takes the time to study the subject will see that neither good nor bad management is confined to any one system or type He will find a few instances of good management containing all of the elements necessary for permanent prosperity for both employers and men under ordinary day work the task system piece work contract work the premium plan the bonus system and the differential rate and he will find a very much larger number of instances of bad management under these systems containing as they do the elements which lead to discord and ultimate loss and trouble for both sides If neither the prosperity of the company nor any particular type or system furnishes an index to proper management what then is the touchstone which indicates good or bad management The art of management has been defined as knowing exactly what you want men to do and then seeing that they do it in the best and cheapest way No concise definition can fully describe an art but the relations between employers and men form without question the most important part of this art In considering the subject therefore until this part of the problem has been fully discussed the other phases of the art may be left in the background The progress of many types of management is punctuated by a series of disputes disagreements and compromises between employers and men and each side spends more than a considerable portion of its time thinking and talking over the injustice which it receives at the hands of the other All such types are out of the question and need not be considered It is safe to say that no system or scheme of management should be considered which does not in the long run give satisfaction to both employer and employé which does not make it apparent that their best interests are mutual and which does not bring about such thorough and hearty coöperation that they can pull together instead of apart It cannot be said that this condition has as yet been at all generally recognized as the necessary foundation for good management On the contrary it is still quite generally regarded as a fact by both sides that in many of the most vital matters the best interests of employers are necessarily opposed to those of the men In fact the two elements which we will all agree are most wanted on the one hand by the men and on the other hand by the employers are generally looked upon as antagonistic What the workmen want from their employers beyond anything else is high wages and what employers want from their workmen most of all is a low labor cost of manufacture These two conditions are not diametrically opposed to one another as would appear at first glance On the contrary they can be made to go together in all classes of work without exception and in the writers judgment the existence or absence of these two elements forms the best index to either good or bad management This book is written mainly with the object of advocating high wages and low labor cost as the foundation of the best management of pointing out the general principles which render it possible to maintain these conditions even under the most trying circumstances and of indicating the various steps which the writer thinks should be taken in changing from a poor system to a better type of management The condition of high wages and low labor cost is far from being accepted either by the average manager or the average workman as a practical working basis It is safe to say that the majority of employers have a feeling of satisfaction when their workmen are receiving lower wages than those of their competitors On the other hand very many workmen feel contented if they find themselves doing the same amount of work per day as other similar workmen do and yet are getting more pay for it Employers and workmen alike should look upon both of these conditions with apprehension as either of them are sure in the long run to lead to trouble and loss for both parties Through unusual personal influence and energy or more frequently through especial conditions which are but temporary such as dull times when there is a surplus of labor a superintendent may succeed in getting men to work extra hard for ordinary wages After the men however realize that this is the case and an opportunity comes for them to change these conditions in their reaction against what they believe unjust treatment they are almost sure to lean so far in the other direction as to do an equally great injustice to their employer On the other hand the men who use the opportunity offered by a scarcity of labor to exact wages higher than the average of their class without doing more than the average work in return are merely laying up trouble for themselves in the long run They grow accustomed to a high rate of living and expenditure and when the inevitable turn comes and they are either thrown out of employment or forced to accept low wages they are the losers by the whole transaction The only condition which contains the elements of stability and permanent satisfaction is that in which both employer and employés are doing as well or better than their competitors are likely to do and this in nine cases out of ten means high wages and low labor cost and both parties should be equally anxious for these conditions to prevail With them the employer can hold his own with his competitors at all times and secure sufficient work to keep his men busy even in dull times Without them both parties may do well enough in busy times but both parties are likely to suffer when work becomes scarce The possibility of coupling high wages with a low labor cost rests mainly upon the enormous difference between the amount of work which a firstclass man can do under favorable circumstances and the work which is actually done by the average man That there is a difference between the average and the firstclass man is known to all employers but that the firstclass man can do in most cases from two to four times as much as is done by an average man is known to but few and is fully realized only by those who have made a thorough and scientific study of the possibilities of men The writer has found this enormous difference between the firstclass and average man to exist in all of the trades and branches of labor which he has investigated and these cover a large field as he together with several of his friends has been engaged with more than usual opportunities for thirty years past in carefully and systematically studying this subject This difference in the output of firstclass and average men is as little realized by the workmen as by their employers The firstclass men know that they can do more work than the average but they have rarely made any careful study of the matter And the writer has over and over again found them utterly incredulous when he informed them after close observation and study how much they were able to do In fact in most cases when first told that they are able to do two or three times as much as they have done they take it as a joke and will not believe that one is in earnest It must be distinctly understood that in referring to the possibilities of a firstclass man the writer does not mean what he can do when on a spurt or when he is overexerting himself but what a good man can keep up for a long term of years without injury to his health It is a pace under which men become happier and thrive The second and equally interesting fact upon which the possibility of coupling high wages with low labor cost rests is that firstclass men are not only willing but glad to work at their maximum speed providing they are paid from 30 to 100 per cent more than the average of their trade The exact percentage by which the wages must be increased in order to make them work to their maximum is not a subject to be theorized over settled by boards of directors sitting in solemn conclave nor voted upon by trades unions It is a fact inherent in human nature and has only been determined through the slow and difficult process of trial and error The writer has found for example after making many mistakes above and below the proper mark that to get the maximum output for ordinary shop work requiring neither especial brains very close application skill nor extra hard work such for instance as the more ordinary kinds of routine machine shop work it is necessary to pay about 30 per cent more than the average For ordinary day labor requiring little brains or special skill but calling for strength severe bodily exertion and fatigue it is necessary to pay from 50 per cent to 60 per cent above the average For work requiring especial skill or brains coupled with close application but without severe bodily exertion such as the more difficult and delicate machinists work from 70 per cent to 80 per cent beyond the average And for work requiring skill brains close application strength and severe bodily exertion such for instance as that involved in operating a well run steam hammer doing miscellaneous work from 80 per cent to 100 per cent beyond the average There are plenty of good men ready to do their best for the above percentages of increase but if the endeavor is made to get the right men to work at this maximum for less than the above increase it will be found that most of them will prefer their old rate of speed with the lower pay After trying the high speed piece work for a while they will one after another throw up their jobs and return to the old day work conditions Men will not work at their best unless assured a good liberal increase which must be permanent It is the writers judgment on the other hand that for their own good it is as important that workmen should not be very much overpaid as it is that they should not be underpaid If overpaid many will work irregularly and tend to become more or less shiftless extravagant and dissipated It does not do for most men to get rich too fast The writers observation however would lead him to the conclusion that most men tend to become more instead of less thrifty when they receive the proper increase for an extra hard days work as for example the percentages of increase referred to above They live rather better begin to save money become more sober and work more steadily And this certainly forms one of the strongest reasons for advocating this type of management In referring to high wages and low labor cost as fundamental in good management the writer is most desirous not to be misunderstood By high wages he means wages which are high only with relation to the average of the class to which the man belongs and which are paid only to those who do much more or better work than the average of their class He would not for an instant advocate the use of a highpriced tradesman to do the work which could be done by a trained laborer or a lowerpriced man No one would think of using a fine trotter to draw a grocery wagon nor a Percheron to do the work of a little mule No more should a mechanic be allowed to do work for which a trained laborer can be used and the writer goes so far as to say that almost any job that is repeated over and over again however great skill and dexterity it may require providing there is enough of it to occupy a man throughout a considerable part of the year should be done by a trained laborer and not by a mechanic A man with only the intelligence of an average laborer can be taught to do the most difficult and delicate work if it is repeated enough times and his lower mental caliber renders him more fit than the mechanic to stand the monotony of repetition It would seem to be the duty of employers therefore both in their own interest and in that of their employees to see that each workman is given as far as possible the highest class of work for which his brains and physique fit him A man however whose mental caliber and education do not fit him to become a good mechanic and that grade of man is the one referred to as belonging to the laboring class when he is trained to do some few especial jobs which were formerly done by mechanics should not expect to be paid the wages of a mechanic He should get more than the average laborer but less than a mechanic thus insuring high wages to the workman and low labor cost to the employer and in this way making it most apparent to both that their interests are mutual To summarize then what the aim in each establishment should be a That each workman should be given as far as possible the highest grade of work for which his ability and physique fit him b That each workman should be called upon to turn out the maximum amount of work which a firstrate man of his class can do and thrive c That each workman when he works at the best pace of a firstclass man should be paid from 30 per cent to 100 per cent according to the nature of the work which he does beyond the average of his class And this means high wages and a low labor cost These conditions not only serve the best interests of the employer but they tend to raise each workman to the highest level which he is fitted to attain by making him use his best faculties forcing him to become and remain ambitious and energetic and giving him sufficient pay to live better than in the past Under these conditions the writer has seen many firstclass men developed who otherwise would have remained second or third class all of their lives Is not the presence or absence of these conditions the best indication that any system of management is either well or badly applied And in considering the relative merits of different types of management is not that system the best which will establish these conditions with the greatest certainty precision and speed In comparing the management of manufacturing and engineering companies by this standard it is surprising to see how far they fall short Few of those which are best organized have attained even approximately the maximum output of firstclass men Many of them are paying much higher prices per piece than are required to secure the maximum prod uct while owing to a bad system lack of exact knowledge of the time required to do work and mutual suspicion and misunderstanding between employers and men the output per man is so small that the men receive little if any more than average wages both sides being evidently the losers thereby The chief causes which produce this loss to both parties are First and by far the most important the profound ignorance of employers and their foremen as to the time in which various kinds of work should be done and this ignorance is shared largely by the workmen Second The indifference of the employers and their ignorance as to the proper system of management to adopt and the method of applying it and further their indifference as to the individual character worth and welfare of their men On the part of the men the greatest obstacle to the attainment of this standard is the slow pace which they adopt or the loafing or soldiering marking time as it is called This loafing or soldiering proceeds from two causes First from the natural instinct and tendency of men to take it easy which may be called natural soldiering Second from more intricate second thought and reasoning caused by their relations with other men which may be called systematic soldiering There is no question that the tendency of the average man in all walks of life is toward working at a slow easy gait and that it is only after a good deal of thought and observation on his part or as a result of example conscience or external pressure that he takes a more rapid pace There are of course men of unusual energy vitality and ambition who naturally choose the fastest gait set up their own standards and who will work hard even though it may be against their best interests But these few uncommon men only serve by affording a contrast to emphasize the tendency of the average This common tendency to take it easy is greatly increased by bringing a number of men together on similar work and at a uniform standard rate of pay by the day Under this plan the better men gradually but surely slow down their gait to that of the poorest and least efficient When a naturally energetic man works for a few days beside a lazy one the logic of the situation is unanswerable Why should I work hard when that lazy fellow gets the same pay that I do and does only half as much work A careful time study of men working under these conditions will disclose facts which are ludicrous as well as pitiable To illustrate The writer has timed a naturally energetic workman who while going and coming from work would walk at a speed of from three to four miles per hour and not infrequently trot home after a days work On arriving at his work he would immediately slow down to a speed of about one mile an hour When for example wheeling a loaded wheelbarrow he would go at a good fast pace even up hill in order to be as short a time as possible under load and immediately on the return walk slow down to a mile an hour improving every opportunity for delay short of actually sitting down In order to be sure not to do more than his lazy neighbor he would actually tire himself in his effort to go slow These men were working under a foreman of good reputation and one highly thought of by his employer who when his attention was called to this state of things answered Well I can keep them from sitting down but the devil cant make them get a move on while they are at work The natural laziness of men is serious but by far the greatest evil from which both workmen and employers are suffering is the systematic soldiering which is almost universal under all of the ordinary schemes of management and which results from a careful study on the part of the workmen of what they think will promote their best interests The writer was much interested recently to hear one small but experienced golf caddy boy of twelve explaining to a green caddy who had shown special energy and interest the necessity of going slow and lagging behind his man when he came up to the ball showing him that since they were paid by the hour the faster they went the less money they got and finally telling him that if he went too fast the other boys would give him a licking This represents a type of systematic soldiering which is not however very serious since it is done with the knowledge of the employer who can quite easily break it up if he wishes The greater part of the systematic soldiering how ever is done by the men with the deliberate object of keeping their employers ignorant of how fast work can be done So universal is soldiering for this purpose that hardly a competent workman can be found in a large establishment whether he works by the day or on piece work contract work or under any of the ordinary systems of compensating labor who does not devote a considerable part of his time to studying just how slowly he can work and still convince his employer that he is going at a good pace The causes for this are briefly that practically all employers determine upon a maximum sum which they feel it is right for each of their classes of employees to earn per day whether their men work by the day or piece Each workman soon finds out about what this figure is for his particular case and he also realizes that when his employer is convinced that a man is capable of doing more work than he has done he will find sooner or later some way of compelling him to do it with little or no increase of pay Employers derive their knowledge of how much of a given class of work can be done in a day from either their own experience which has frequently grown hazy with age from casual and unsystematic observation of their men or at best from records which are kept showing the quickest time in which each job has been done In many cases the employer will feel almost certain that a given job can be done faster than it has been but he rarely cares to take the drastic measures necessary to force men to do it in the quickest time unless he has an actual record proving conclusively how fast the work can be done It evidently becomes for each mans interest then to see that no job is done faster than it has been in the past The younger and less experienced men are taught this by their elders and all possible persuasion and social pressure is brought to bear upon the greedy and selfish men to keep them from making new records which result in temporarily increasing their wages while all those who come after them are made to work harder for the same old pay Under the best day work of the ordinary type when accurate records are kept of the amount of work done by each man and of his efficiency and when each mans wages are raised as he improves and those who fail to rise to a certain standard are discharged and a fresh supply of carefully selected men are given work in their places both the natural loafing and systematic soldiering can be largely broken up This can be done however only when the men are thoroughly convinced that there is no intention of establishing piece work even in the remote future and it is next to impossible to make men believe this when the work is of such a nature that they believe piece work to be practicable In most cases their fear of making a record which will be used as a basis for piece work will cause them to soldier as much as they dare It is however under piece work that the art of systematic soldiering is thoroughly developed After a workman has had the price per piece of the work he is doing lowered two or three times as a result of his having worked harder and increased his output he is likely to entirely lose sight of his employers side of the case and to become imbued with a grim determination to have no more cuts if soldiering can prevent it Unfortunately for the character of the workman soldiering involves a deliberate attempt to mislead and deceive his employer and thus upright and straightforward workmen are compelled to become more or less hypocritical The employer is soon looked upon as an antagonist if not as an enemy and the mutual confidence which should exist between a leader and his men the enthusiasm the feeling that they are all working for the same end and will share in the results is entirely lacking The feeling of antagonism under the ordinary piecework system becomes in many cases so marked on the part of the men that any proposition made by their employers however reasonable is looked upon with suspicion Soldiering becomes such a fixed habit that men will frequently take pains to restrict the product of machines which they are running when even a large increase in output would involve no more work on their part On work which is repeated over and over again and the volume of which is sufficient to permit it the plan of making a contract with a competent workman to do a certain class of work and allowing him to employ his own men subject to strict limitations is successful As a rule the fewer the men employed by the contractor and the smaller the variety of the work the greater will be the success under the contract system the reason for this being that the contractor under the spur of financial necessity makes personally so close a study of the quickest time in which the work can be done that soldiering on the part of his men becomes difficult and the best of them teach laborers or lowerpriced helpers to do the work formerly done by mechanics The objections to the contract system are that the machine tools used by the contractor are apt to deteriorate rapidly his chief interest being to get a large output whether the tools are properly cared for or not and that through the ignorance and inexperience of the contractor in handling men his employés are frequently unjustly treated These disadvantages are however more than counterbalanced by the comparative absence of soldiering on the part of the men The greatest objection to this system is the soldiering which the contractor himself does in many cases so as to secure a good price for his next contract It is not at all unusual for a contractor to restrict the output of his own men and to refuse to adopt improvements in machines appliances or methods while in the midst of a contract knowing that his next contract price will be lowered in direct proportion to the profits which he has made and the improvements introduced Under the contract system however the relations between employers and men are much more agreeable and normal than under piece work and it is to be regretted that owing to the nature of the work done in most shops this system is not more generally applicable The writer quotes as follows from his paper on A Piece Rate System read in 1895 before The American Society of Mechanical Engineers Coöperation or profit sharing has entered the mind of every student of the subject as one of the possible and most attractive solutions of the problem and there haver been certain instances both in England and France of at least a partial success of cooperative experiments So far as I know however these trials have been made either in small towns remote from the manufacturing centers or in industries which in many respects are not subject to ordinary manufacturing conditions Coöperative experiments have failed and I think are generally destined to fail for several reasons the first and most important of which is that no form of cooperation has yet been devised in which each individual is allowed free scope for his personal ambition Personal ambition always has been and will remain a more powerful incentive to exertion than a desire for the general welfare The few misplaced drones who do the loafing and share equally in the profits with the rest under cooperation are sure to drag the better men down toward their level The second and almost equally strong reason for failure lies in the remoteness of the reward The average workman I dont say all men cannot look forward to a profit which is six months or a year away The nice time which they are sure to have today if they take things easily proves more attractive than hard work with a possible reward to be shared with others six months later Other and formidable difficulties in the path of coöperation are the equitable division of the profits and the fact that while workmen are always ready to share the profits they are neither able nor willing to share the losses Further than this in many cases it is neither right nor just that they should share either in the profits or the losses since these may be due in great part to causes entirely beyond their influence or control and to which they do not contribute Of all the ordinary systems of management in use in which no accurate scientific study of the time problem is undertaken and no carefully measured tasks are assigned to the men which must be accomplished in a given time the best is the plan fundamentally originated by Mr Henry R Towne and improved and made practical by Mr F A Halsey This plan is described in papers read by Mr Towne before The American Society of Mechanical Engineers in 1886 and by Mr Halsey in 1891 and has since been criticised and ably defended in a series of articles appearing in the American Machinist The TowneHalsey plan consists in recording the quickest time in which a job has been done and fixing this as a standard If the workman succeeds in doing the job in a shorter time he is still paid his same wages per hour for the time he works on the job and in addition is given a premium for having worked faster consisting of from onequarter to onehalf the difference between the wages earned and the wages originally paid when the job was done in standard time Mr Halsey recommends the payment of onethird of the difference as the best premium for most cases The difference between this system and ordinary piece work is that the workman on piece work gets the whole of the difference between the actual time of a job and the standard time while under the TowneHalsey plan he gets only a fraction of this difference It is not unusual to hear the TowneHalsey plan referred to as practically the same as piece work This is far from the truth for while the difference between the two does not appear to a casual observer to be great and the general principles of the two seem to be the same still we all know that success or failure in many cases hinges upon small differences In the writers judgment the TowneHalsey plan is a great invention and like many other great inventions its value lies in its simplicity This plan has already been successfully adopted by a large number of establishments and has resulted in giving higher wages to many workmen accompanied by a lower labor cost to the employer and at the same time materially improving their relations by lessening the feeling of antagonism between the two This system is successful because it diminishes soldiering and this rests entirely upon the fact that since the workman only receives say onethird of the increase in pay that he would get under corresponding conditions on piece work there is not the same temptation for the employer to cut prices After this system has been in operation for a year or two if no cuts in prices have been made the tendency of the men to soldier on that portion of the work which is being done under the system is diminished although it does not entirely cease On the other hand the tendency of the men to soldier on new work which is started and on such portions as are still done on day work is even greater under the TowneHalsey plan than under piece work To illustrate Workmen like the rest of mankind are more strongly influenced by object lessons than by theories The effect on men of such an object lesson as the following will be apparent Suppose that two men named respectively Smart and Honest are at work by the day and receive the same pay say 20 cents per hour Each of these men is given a new piece of work which could be done in one hour Smart does his job in four hours and it is by no means unusual for men to soldier to this extent Honest does his in one and onehalf hours Now when these two jobs start on this basis under the TowneHalsey plan and are ultimately done in one hour each Smart receives for his job 20 cents per hour a premium of 68 20 cents a total of 4C cents Honest receives for his job 20 cents per hour a premium of 13 3 13 cents a total of 23 13 cents Most of the men in the shop will follow the example of Smart rather than that of Honest and will soldier to the extent of three or four hundred per cent if allowed to do so The TowneHalsey system shares with ordinary piece work then the greatest evil of the latter namely that its very foundation rests upon deceit and under both of these systems there is necessarily as we have seen a great lack of justice and equality in the startingpoint of different jobs Some of the rates will have resulted from records obtained when a firstclass man was working close to his maximum speed while others will be based on the performance of a poor man at onethird or onequarter speed The injustice of the very foundation of the system is thus forced upon the workman every day of his life and no man however kindly disposed he may be toward his employer can fail to resent this and be seriously influenced by it in his work These systems are therefore of necessity slow and irregular in their operation in reducing costs They drift gradually toward an increased output but under them the attainment of the maximum output of a firstclass man is almost impossible Objection has been made to the use of the word drifting in this connection It is used absolutely without any intention of slurring the TowneHalsey system or in the least detracting from its true merit 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 ancl 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 clearcut 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 constitute 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 ratefixing 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 TowneHalsey 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 TowneHalsey 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 TowneHalsey system and task management have in common is that both recognize the allimportant 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 partiesthe 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 selfdefense 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 TowneHalsey 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 onethird to onequarter 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 TowneHalsey system the best of this class is that their startingpoint 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 firstclass 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 classes 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 illustration 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 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 firstclass 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 class 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 class of work a single firstclass workman was picked out and started on ordinary piece work on this job His task required him to do between three and onehalf and four times 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 illustration 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 115 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 class 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 class 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 openhearth furnaces such as ore of varies kinds varying from fine gravelly ore to that which comes in large lumps coke limestone special pig sand etc unloading hard and soft coal for boilers gasproducers etc and also for storage and again loading the stored coal as required for use loading the pigiron 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 class 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 collegeeducated man in charge of progress in this line This man had not before handled this class 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 firstclass man can do in a day This was done by timing with a stop watch a firstclass 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 mans work into its elements and time each element separately For example in the case of a man loading pigiron 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 as much work in a day as had been done in the past on an average Between twelve and thirteen tons of pigiron 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 pigiron 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 writers system was called upon to load on piece work from fortyfive to fortyeight tons 2240 lbs each per day He regarded this task as an entirely fair one and earned on an average from the start 185 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 class 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 intimi dated 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 185 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 185 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 days 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 mans 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 falling off in earnings and consequent dissatisfaction An interesting illustration 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 at Bethlehem Table 1 on page 54 gives a summary of the work done by the piecework laborers in handling raw materials such as ores anthracite and bituminous coal coke pigiron 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 ie 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 writers assistant in this section at that time Number of tons 2240 lbs per ton handled on piece work during the year ending April 30 1901 924040 Total cost of handling 924040 tons including the piece work wages paid the men and in addition all incidental day labor used 3079778 Former cost of handling the same number of tons of similar materials on day work 6721547 Net saving in handling 924040 tons of materials effected in one year through substituting piece work for day work 3641769 Average cost for handling a ton 2240 lbs on piece and day work 0033 0072 Average earnings per day per man 188 115 Average number of tons handled per day per man 57 16 TABLE 1 SHOWING RELATIVE COST OF YARD LABOR UNDER TASK PIECE WORK AND OLD STYLE DAY WORK 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 firstclass men because in each case the task which they were called upon to perform was such that only a firstclass man could do it The tasks were all purposely made so severe that not more 1 It was our intention to fix piece work rates which should enable firstclass workmen to average about 60 per cent more than they had been earning on day work namely 185 per day A years average shows them to have earned 188 per day or three cents per man per day more than we expected an error of 1½ per cent 2 The piece workers handled on an average 3½ times as many tons per day as the day workers than one out of five laborers perhaps even a smaller percentage than this could keep up It was clearly understood by each newcomer as he went to work that unless he was able to average at least 185 per day he would have to make way for another man who could do so As a result firstclass men from all over that part of the country who were in most cases earning from 105 to 115 per day were anxious to try their hands at earning 185 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 firstclass 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 attitude 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 class laborer or not Each man felt that if he belonged in the first class 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 A careful inquiry into the condition of these men when away from work developed the fact that out of the whole gang only two were said to be drinking men This does not of course imply that many of them did not take an occasional drink The fact is that a steady drinker would find it almost impossible to keep up with the pace which was set so that they were practically all sober Many if not most of them were saving money and they all lived better than they had before The results attained under this system were most satisfactory both to employer and workmen and show in a convincing way the possibility of uniting high wages with a low labor cost This is virtually a labor union of firstclass men who are united together to secure the extra high wages which belong to them by right and which in this case are begrudged them by none and which will be theirs through dull times as well as periods of activity Such a union commands the unqualified admiration and respect of all classes of the community the respect equally of workmen employers political economists and philanthropists There are no dues for membership since all of the expenses are paid by the company The employers act as officers of the Union to enforce its rules and keep its records since the interests of the company are identical and bound up with those of the men It is never necessary to plead with or persuade men to join this Union since the employers themselves organize it free of cost the best workmen in the community are always anxious to belong to it The feature most to be regretted about it is that the membership is limited The words labor union are however unfortunately so closely associated in the minds of most people with the idea of disagreement and strife between employers and men that it seems almost incongruous to apply them to this case Is not this however the ideal labor union with character and special ability of a high order as the only qualifications for membership It is a curious fact that with the people to whom the writer has described this system the first feeling particularly among those more philanthropically inclined is one of pity for the inferior workmen who lost their jobs in order to make way for the firstclass men This sympathy is entirely misplaced There was such a demand for labor at the time that no workman was obliged to be out of work for more than a day or two and so the poor workmen were practically as well off as ever The feeling instead of being one of pity for the inferior workmen should be one of congratulation and rejoicing that many firstclass men who through unfortunate circumstances had never had the opportunity of proving their worth at last were given the chance to earn high wages and become prosperous What the writer wishes particularly to emphasize is that this whole system rests upon an accurate and scientific study of unit times which is by far the most important element in scientific management With it greater and more permanent results can be attained even under ordinary day work or piece work than can be reached under any of the more elaborate systems without it In 1895 the writer read a paper before The American Society of Mechanical Engineers entitled A Piece Rate System His chief object in writing it was to advocate the study of unit times as the foundation of good management Unfortunately he at the same time described the differential rate system of piece work which had been introduced by him in the Midvale Steel Works Although he called attention to the fact that the latter was entirely of secondary importance the differential rate was widely discussed in the journals of this country and abroad while practically nothing was said about the study of unit times Thirteen members of the Society discussed the piece rate system at length and only two briefly referred to the study of the unit times The writer most sincerely trusts that his leading object in writing this book will not be overlooked and that scientific time study will receive the attention which it merits Bearing in mind the Bethlehem yard labor as an illustration of the application of the study of unit times as the foundation of success in management the following would seem to him a fair comparison of the older methods with the more modern plan For each job there is the quickest time in which it can be done by a firstclass man This time may be called the quickest time or the standard time for the job Under all the ordinary systems this quickest time is more or less completely shrouded in mist In most cases however the workman is nearer to it and sees it more clearly than the employer Under ordinary piece work the management watch every indication given them by the workmen as to what the quickest time is for each job and endeavor continually to force the men toward this standard time while the workmen constantly use every effort to prevent this from being done and to lead the management in the wrong direction In spite of this conflict however the standard time is gradually approached Under the TowneHalsey plan the management gives up all direct effort to reach this quickest time but offers mild inducements to the workmen to do so and turns over the whole enterprise to them The workmen peacefully as far as the management is concerned but with considerable pulling and hauling among themselves and without the assistance of a trained guiding hand drift gradually and slowly in the direction of the standard time but rarely approach it closely With accurate time study as a basis the quickest time for each job is at all times in plain sight of both employers and workmen and is reached with accuracy precision and speed both sides pulling hard in the same direction under the uniform simple and just agreement that whenever a firstclass man works his best he will receive from 30 to 100 per cent more than the average of his trade Probably a majority of the attempts that are made to radically change the organization of manufacturing companies result in a loss of money to the company failure to bring about the change sought for and a return to practically the original organization The reason for this being that there are but few employers who look upon management as an art and that they go at a difficult task without either having understood or appreciated the time required for organization or its cost the troubles to be met with or the obstacles to be overcome and without having studied the means to be employed in doing so Before starting to make any changes in the organization of a company the following matters should be carefully considered First the importance of choosing the general type of management best suited to the particular case Second that in all cases money must be spent and in many cases a great deal of money before the changes are completed which result in lowering cost Third that it takes time to reach any result worth aiming at Fourth the importance of making changes in their proper order and that unless the right steps are taken and taken in their proper sequence there is great danger from deterioration in the quality of the output and from serious troubles with the workmen often resulting in strikes As to the type of management to be ultimately aimed at before any changes whatever are made it is necessary or at least highly desirable that the most careful consideration should be given to the type to be chosen and once a scheme is decided upon it should be carried forward step by step without wavering or retrograding Workmen will tolerate and even come to have great respect for one change after another made in logical sequence and according to a consistent plan It is most demoralizing however to have to recall a step once taken whatever may be the cause and it makes any further changes doubly difficult The choice must be made between some of the types of management in common use which the writer feels are properly designated by the word drifting and the more modern and scientific management based on an accurate knowledge of how long it should take to do the work If as is frequently the case the managers of an enterprise find themselves so overwhelmed with other departments of the business that they can give but little thought to the management of the shop then some one of the various drifting schemes should be adopted and of these the writer believes the TowneHalsey plan to be the best since it drifts safely and peacefully though slowly in the right direction yet under it the best results can never be reached The fact however that managers are in this way overwhelmed by their work is the best proof that there is something radically wrong with the plan of their organization and in self defense they should take immediate steps toward a more thorough study of the art It is not at all generally realized that whatever system may be used providing a business is complex in its nature the building up of an efficient organization is necessarily slow and sometimes very expensive Almost all of the directors of manufacturing companies appreciate the economy of a thoroughly modern uptodate and efficient plant and are willing to pay for it Very few of them however realize that the best organization whatever its cost may be is in many cases even more important than the plant nor do they clearly realize that no kind of an efficient organization can be built up without spending money The spending of money for good machinery appeals to them because they can see machines after they are bought but putting money into anything so invisible intangible and to the average man so indefinite as an organization seems almost like throwing it away There is no question that when the work to be done is at all complicated a good organization with a poor plant will give better results than the best plant with a poor organization One of the most successful manufacturers in this country was asked recently by a number of financiers whether he thought that the difference between one style of organization and another amounted to much providing the company had an uptodate plant properly located His answer was If I had to choose now between abandoning my present organization and burning down all of my plants which have cost me millions I should choose the latter My plants could be rebuilt in a short while with borrowed money but I could hardly replace my organization in a generation Modern engineering can almost be called an exact science each year removes it further from guess work and from ruleofthumb methods and establishes it more firmly upon the foundation of fixed principles The writer feels that management is also destined to become more of an art and that many of the elements which are now believed to be outside the field of exact knowledge will soon be standardized tabulated accepted and used as are now many of the elements of engineering Management will be studied as an art and will rest upon well recognized clearly defined and fixed principles instead of depending upon more or less hazy ideas received from a limited observation of the few organizations with which the individual may have come in contact There will of course be various successful types and the application of the underlying principles must be modified to suit each particular case The writer has already indicated that he thinks the first object in management is to unite high wages with a low labor cost He believes that this object can be most easily attained by the application of the following principles a A LARGE DAILY TASK Each man in the establishment high or low should daily have a clearly defined task laid out before him This task should not in the least degree be vague nor indefinite but should be circumscribed carefully and completely and should not be easy to accomplish b STANDARD CONDITIONS Each mans task should call for a full days work and at the same time the workman should be given such standardized conditions and appliances as will enable him to accomplish his task with certainty c HIGH PAY FOR SUCCESS He should be sure of large pay when he accomplishes his task d LOSS IN CASE OF FAILURE When he fails he should be sure that sooner or later he will be the loser by it When an establishment has reached an advanced state of organization in many cases a fifth element should be added namely the task should be made so difficult that it can only be accomplished by a firstclass man There is nothing new nor startling about any of these principles and yet it will be difficult to find a shop in which they are not daily violated over and over again They call however for a greater departure from the ordinary types of organization than would at first appear In the case for instance of a machine shop doing miscellaneous work in order to assign daily to each man a carefully measured task a special planning department is required to lay out all of the work at least one day ahead All orders must be given to the men in detail in writing and in order to lay out the next days work and plan the entire progress of work through the shop daily returns must be made by the men to the planning department in writing showing just what has been done Before each casting or forging arrives in the shop the exact route which it is to take from machine to machine should be laid out An instruction card for each operation must be written out stating in detail just how each operation on every piece of work is to be done and the time required to do it the drawing number any special tools jigs or appliances required etc Before the four principles above referred to can be successfully applied it is also necessary in most shops to make important physical changes All of the small details in the shop which are usually regarded as of little importance and are left to be regulated according to the individual taste of the workman or at best of the foreman must be thoroughly and carefully standardized such details for instance as the care and tightening of the belts the exact shape and quality of each cutting tool the establishment of a complete tool room from which properly ground tools as well as jigs templets drawings etc are issued under a good check system etc and as a matter of importance in fact as the foundation of scientific management an accurate study of unit times must be made by one or more men connected with the planning department and each machine tool must be standardized and a table or slide rule constructed for it showing how to run it to the best advantage At first view the running of a planning department together with the other innovations would appear to involve a large amount of additional work and expense and the most natural question would be is whether the increased efficiency of the shop more than offsets this outlay It must be borne in mind however that with the exception of the study of unit times there is hardly a single item of work done in the planning department which is not already being done in the shop Establishing a planning department merely concentrates the planning and much other brainwork in a few men especially fitted for their task and trained in their especial lines instead of having it done as heretofore in most cases by high priced mechanics well fitted to work at their trades but poorly trained for work more or less clerical in its nature There is a close analogy between the methods of modern engineering and this type of management Engineering now centers in the drafting room as modern management does in the planning department The new style engineering has all the appearance of complication and extravagance with its multitude of drawings the amount of study and work which is put into each detail and its corps of draftsmen all of whom would be sneered at by the old engineer as nonproducers For the same reason modern management with its minute time study and a managing department in which each operation is carefully planned with its many written orders and its apparent red tape looks like a waste of money while the ordinary management in which the planning is mainly done by the workmen themselves with the help of one or two foremen seems simple and economical in the extreme The writer however while still a young man had all lingering doubt as to the value of a drafting room dispelled by seeing the chief engineer the foreman of the machine shop the foreman of the foundry and one or two workmen in one of our large and successful engineering establishments of the old school stand over the cylinder of an engine which was being built with chalk and dividers and discuss for more than an hour the proper size and location of the studs for fastening on the cylinder head This was simplicity but not economy About the same time he became thoroughly convinced of the necessity and economy of a planning department with time study and with written instruction cards and returns He saw over and over again a workman shut down his machine and hunt up the foreman to inquire perhaps what work to put into his machine next and then chase around the shop to find it or to have a special tool or templet looked up or made He saw workmen carefully nursing their jobs by the hour and doing next to nothing to avoid making a record and he was even more forcibly convinced of the necessity for a change while he was still working as a machinist by being ordered by the other men to slow down to half speed under penalty of being thrown over the fence No one now doubts the economy of the drafting room and the writer predicts that in a very few years from now no one will doubt the economy and necessity of the study of unit times and of the planning department Another point of analogy between modern engi neering and modern management lies in the fact that modern engineering proceeds with comparative certainty to the design and construction of a machine or structure of the maximum efficiency with the minimum weight and cost of materials while the old style engineering at best only approximated these results and then only after a series of breakdowns involving the practical reconstruction of the machine and the lapse of a long period of time The ordinary system of management owing to the lack of exact information and precise methods can only approximate to the desired standard of high wages accompanied by low labor cost and then only slowly with marked irregularity in results with continued opposition and in many cases with danger from strikes Modern management on the other hand proceeds slowly at first but with directness and precision step by step and after the first few object lessons almost without opposition on the part of the men to high wages and low labor cost and as is of great importance it assigns wages to the men which are uniformly fair They are not demoralized and their sense of justice offended by receiving wages which are sometimes too low and at other times entirely too high One of the marked advantages of scientific management lies in its freedom from strikes The writer has never been opposed by a strike although he has been engaged for a great part of his time since 1883 in introducing this type of management in different parts of the country and in a great variety of industries The only case of which the writer can think in which a strike under this system might be unavoidable would be that in which most of the employés were members of a labor union and of a union whose rules were so inflexible and whose members were so stubborn that they were unwilling to try any other system even though it assured them larger wages than their own The writer has seen however several times after the introduction of this system the members of labor unions who were working under it leave the union in large numbers because they found that they could do better under the operation of the system than under the laws of the union There is no question that the average individual accomplishes the most when he either gives himself or some one else assigns him a definite task namely a given amount of work which he must do within a given time and the more elementary the mind and character of the individual the more necessary does it become that each task shall extend over a short period of time only No school teacher would think of telling children in a general way to study a certain book or subject It is practically universal to assign each day a definite lesson beginning on one specified page and line and ending on another and the best progress is made when the conditions are such that a definite study hour or period can be assigned in which the lesson must be learned Most of us remain through a great part of our lives in this respect grownup children and do our best only under pressure of a task of comparatively short duration Another and perhaps equally great advantage of assigning a daily task as against ordinary piece work lies in the fact that the success of a good workman or the failure of a poor one is thereby daily and prominently called to the attention of the management Many a poor workman might be willing to go along in a slipshod way under ordinary piece work careless as to whether he fell off a little in his output or not Very few of them however would be willing to record a daily failure to accomplish their task even if they were allowed to do so by their foreman and also since on ordinary piece work the price alone is specified without limiting the time which the job is to take a quite large falling off in output can in many cases occur without coming to the attention of the management at all It is for these reasons that the writer has above indicated a large daily task for each man as the first of four principles which should be included in the best type of management It is evident however that it is useless to assign a task unless at the same time adequate measures are taken to enforce its accomplishment As Artemus Ward says I can call the spirits from the windy deep but damn em they wont come It is to compel the completion of the daily task then that two of the other principles are required namely high pay for success and loss in case of failure The advantage of Mr H L Gantts system of task work with a bonus and the writers differential rate piece work over the other systems lies in the fact that with each of these the men automatically and daily receive either an extra reward in case of complete success or a distinct loss in case they fall off even a little The four principles above referred to can be successfully applied either under day work piece work task work with a bonus or differential rate piece work and each of these systems has its own especial conditions under which it is to be preferred to either of the other three In no case however should an attempt be made to apply these principles unless accurate and thorough time study has previously been made of every item entering into the days task They should be applied under day work only when a number of miscellaneous jobs have to be done day after day none of which can occupy the entire time of a man throughout the whole of a day and when the time required to do each of these small jobs is likely to vary somewhat each day In this case a number of these jobs can be grouped into a daily task which should be assigned if practicable to one man possibly even to two or three but rarely to a gang of men of any size To illustrate In a small boiler house in which there is no storage room for coal the work of wheeling the coal to the fireman wheeling out the ashes helping clean fires and keeping the boiler room and the outside of the boilers clean can be made into the daily task for a man and if these items do not sum up into a full days work on the average other duties can be added until a proper task is assured Or the various details of sweeping cleaning and keeping a certain section of a shop floor windows machines etc in order can be united to form a task Or in a small factory which turns out a uniform product and in uniform quantities day after day supplying raw materials to certain parts of the factory and removing finished product from others may be coupled with other definite duties to form a task The task should call for a large days work and the man should be paid more than the usual days pay so that the position will be sought for by firstclass ambitious men Clerical work can very properly be done by the task in this way although when there is enough of it piece work at so much per entry is to be preferred In all cases a clear cut definite inspection of the task is desirable at least once a day and sometimes twice When a shop is not running at night a good time for this inspection is at seven oclock in the morning for instance The inspector should daily sign a printed card stating that he has inspected the work done by and enumerating the various items of the task The card should state that the workman has satisfactorily performed his task except the following items which should be enumerated in detail When men are working on task work by the day they should be made to start to work at the regular starting hour They should however have no regular time for leaving As soon as the task is finished they should be allowed to go home and on the other hand they should be made to stay at work until their task is done even if it lasts into the night no deduction being made for shorter hours nor extra pay allowed for overtime It is both inhuman and unwise to ask a man working on task work to stay in the shop after his task is finished to maintain the discipline of the shop as is frequently done It only tends to make men eye servants An amusing instance of the value of task work with freedom to leave when the task is done w as given the writer by his friend Mr Chas D Rogers for many years superintendent of the American Screw Works of Providence R I one of the greatest mechanical geniuses and most resourceful managers that this country has produced but a man who owing to his great modesty has never been fully appreciated outside of those who know him well Mr Rogers tried several modifications of day and piece work in an unsuccessful endeavor to get the children who were engaged in sorting over the very small screws to do a fair days work He finally met with great success by assigning to each child a fair days task and allowing him to go home and play as soon as his task was done Each childs playtime was his own and highly prized while the greater part of his wages went to his parents Piece work embodying the task idea can be used to advantage when there is enough work of the same general character to keep a number of men busy regularly such work for instance as the Bethlehem yard labor previously described or the work of bicycle ball inspection referred to later on In piece work of this class the task idea should always be maintained by keeping it clearly before each man that his average daily earnings must amount to a given high sum as in the case of the Bethlehem laborers 185 per day and that failure to average this amount will surely result in his being laid off It must be remembered that on plain piece work the less competent workmen will always bring what influence and pressure they can to cause the best men to slow down towards their level and that the task idea is needed to counteract this influence Where the labor market is large enough to secure in a reasonable time enough strictly firstclass men the piece work rates should be fixed on such a basis that only a firstclass man working at his best can earn the average amount called for This figure should be in the case of firstclass men as stated above from 30 per cent to 100 per cent beyond the wages usually paid The task idea is emphasized with this style of piece work by two things the high wages and the laying off after a reasonable trial of incompetent men and for the success of the system the number of men employed on practically the same class of work should be large enough for the workmen quite often to have the object lesson of seeing men laid off for failing to earn high wages and others substituted in their places There are comparatively few machine shops or even manufacturing establishments in which the work is so uniform in its nature as to employ enough men on the same grade of work and in sufficiently close contact to one another to render piece work preferable to the other systems In the great majority of cases the work is so miscellaneous in its nature as to call for the employment of workmen varying greatly in their natural ability and attainments all the way for instance from the ordinary laborer through the trained laborer helper rough machinist fitter machine hand to the highly skilled special or allround mechanic And while in a large establishment there may be often enough men of the same grade to warrant the adoption of piece work with the task idea yet even in this case they are generally so scattered in different parts of the shop that laying off one of their number for incompetence does not reach the others with sufficient force to impress them with the necessity of keeping up with their task It is evident then that in the great majority of cases the four leading principles in management can be best applied through either task work with a bonus or the differential piece rate in spite of the slight additional clerical work and the increased difficulty in planning ahead incident to these systems of paying wages Three of the principles of management given above namely a a large daily task b high pay for success and c loss in case of failure form the very essence of both of these systems and act as a daily stimulant for the men The fourth principle of management is a necessary preliminary since without having first thoroughly standardized all of the conditions surrounding work neither of these two plans can be successfully applied In many cases the greatest good resulting from the application of these systems of paying wages is the indirect gain which comes from the enforced standardization of all details and conditions large and small surrounding the work All of the ordinary systems can be and are almost always applied without adopting and maintaining thorough shop standards But the task idea can not be carried out without them The differential rate piece work is rather simpler in its application than task work with bonus and is the more forceful of the two It should be used wherever it is practicable but in no case until after all the accompanying conditions have been perfected and completely standardized and a thorough time study has been made of all of the elements of the work This system is particularly useful where the same kind of work is repeated day after day and also whenever the maximum possible output is desired which is almost always the case in the operation of expensive machinery or of a plant occupying valuable ground or a large building It is more forceful than task work with a bonus because it not only pulls the man up from the top but pushes him equally hard from the bottom Both of these systems give the workman a large extra reward when he accomplishes his full task within the given time With the differential rate if for any reason he fails to do his full task he not only loses the large extra premium which is paid for complete success but in addition he suffers the direct loss of the piece price for each piece by which he falls short Failure under the task with a bonus system involves a corresponding loss of the extra premium or bonus but the workman since he is paid a given price per hour receives his ordinary days pay in case of failure and suffers no additional loss beyond that of the extra premium whether he may have fallen short of the task to the extent of one piece or a dozen In principle these two systems appear to be almost identical yet this small difference the slightly milder nature of task work with a bonus is sufficient to render it much more flexible and therefore applicable to a large number of cases in which the differential rate system cannot be used Task work with a bonus was invented by Mr H L Gantt while he was assisting the writer in organizing the Bethlehem Steel Company The possibilities of his system were immediately recognized by all of the leading men engaged on the work and long before it would have been practicable to use the differential rate work was started under this plan It was successful from the start and steadily grew in volume and in favor and today is more extensively used than ever before Mr Gantts system is especially useful during the difficult and delicate period of transition from the slow pace of ordinary day work to the high speed which is the leading characteristic of good management During this period of transition in the past a time was always reached when a sudden long leap was taken from improved day work to some form of piece work and in making this jump many good men inevitably fell and were lost from the procession Mr Gantts system bridges over this difficult stretch and enables the workman to go smoothly and with gradually accelerated speed from the slower pace of improved day work to the high speed of the new system It does not appear that Mr Gantt has recognized the full advantages to be derived through the proper application of his system during this period of transition at any rate he has failed to point them out in his papers and to call the attention to the best method of applying his plan in such cases No workman can be expected to do a piece of work the first time as fast as he will later It should also be recognized that it takes a certain time for men who have worked at the ordinary slow rate of speed to change to high speed Mr Gantts plan can be adapted to meet both of these conditions by allowing the workman to take a longer time to do the job at first and yet earn his bonus and later compelling him to finish the job in the quickest time in order to get the premium In all cases it is of the utmost importance that each instruction card should state the quickest time in which the workman will ultimately be called upon to do the work There will then be no temptation for the man to soldier since he will see that the management know accurately how fast the work can be done There is also a large class of work in addition to that of the period of transition to which task work with a bonus is especially adapted The higher pressure of the differential rate is the stimulant required by the workman to maintain a high rate of speed and secure high wages while he has the steady swing that belongs to work which is repeated over and over again When however the work is of such variety that each day presents an entirely new task the pressure of the differential rate is some times too severe The chances of failing to quite reach the task are greater in this class of work than in routine work and in many such cases it is better owing to the increased difficulties that the workman should feel sure at least of his regular days rate which is secured him by Mr Gantts system in case he falls short of the full task There is still another case of quite frequent occurrence in which the flexibility of Mr Gantts plan makes it the most desirable In many establishments particularly those doing an engineering business of considerable variety or engaged in constructing and erecting miscellaneous machinery it is necessary to employ continuously a number of especially skilful and highpriced mechanics The particular work for which these men are wanted comes however in many cases at irregular intervals and there are frequently quite long waits between their especial jobs During such periods these men must be provided with work which is ordinarily done by less efficient lowerpriced men and if a proper piece price has been fixed on this work it would naturally be a price suited to the less skilful men and therefore too low for the men in question The alternative is presented of trying to compel these especially skilled men to work for a lower price than they should receive or of fixing a special higher piece price for the work Fixing two prices for the same piece of work one for the man who usually does it and a higher price for the higher grade man always causes the greatest feeling of injustice and dissatisfaction in the man who is discriminated against With Mr Gantts plan