Frederick Taylor's Piece Rate System - 1895 - Part 5
61. As far as possible each man’s work should be inspected and measured separately, and his pay and losses should depend upon his individual efforts alone. It is, of course, a necessity that much of the work of manufacturing — such, for instance, as running roll-trains, hammers, or paper machines — should be done by gangs of men who cooperate to turn out a common product, and that each gang of men should be paid a definite price for the work turned out, just as if they were a single man.
In the distribution of the earnings of a gang among its members, the percentage which each man receives should, however, depend not only upon the kind of work which each man performs, but upon the accuracy and energy with which he fills his position.
In this way the personal ambition of each of a gang of men may be given its proper scope.
62. Again, we find the differential rate acting as a most powerful lever to force each man in a gang of
workmen to do his best ; since if, through the carelessness or laziness of any one man, the gang fails to earn its high rate, the drone will surely be obliged by his companions to do his best the next time or else get out.
63. A great advantage of the differential rate system is that it quickly drives away all inferior workmen and attracts the men best suited to the class of work to which it is applied, since none but really good men can work fast enough and accurately enough to earn the high rate ; and the low rate should be made so small as to be unattractive even to an inferior man.
64. If for no other reason that it secures to an establishment a quick and active set of workmen, the differential rate is a valuable aid, since men are largely creatures of habit, and if the piece-workers of a place are forced to move quickly and work hard the dayworkers soon get into the same way, and the whole shop takes on a more rapid pace.
65. The greatest advantage, however, of the differential rate for piece-work, in connection with a proper rate-fixing department, is that together they produce the proper mental attitude on the part of the men and the management toward each other. In place of the indolence and indifference which characterize the workmen of many day-work establishments and to a considerable extent also their employers, and in place of the constant watchfulness, suspicion, and even antagonism with which too frequently the men and the management regard each other under the ordinary piece-work plan,
both sides soon appreciate the fact that with the differential rate it is their common interest to cooperate to the fullest extent, and to devote every energy to turning out daily the largest possible output This common interest quickly replaces antagonism and establishes a most friendly feeling.
66. Of the two devices for increasing the output of a shop, the differential rate and the scientific rate-fixing department, the latter is by far the more important The differential rate is invaluable at the start as a means of convincing men that the management is in earnest in its intention of paying a premium for hard work, and it at all times furnishes the best means of maintaining the top notch of production ; but when, through its application, the men and the management have come to appreciate the mutual benefit of harmonious cooperation and respect for each other’s rights, it ceases to be an absolute
necessity. On the other hand, the rate-fixing department, for an establishment doing a large variety of work, becomes absolutely indispensable. The longer it is in operation the more necessary it becomes.
67. Practically, the greatest need felt in an establishment wishing to start a rate-fixing department is the lack of data as to the proper rate of speed at which work should be done.
There are hundreds of operations which are common to most large establishments ; yet each concern studies the speed problem for itself, and days of labor are wasted in what should be settled once for all and recorded in a form which is available to all manufacturers.
68. What is needed is a hand-book on the speed with which work can be done, similar to the elementary engineering hand-books. And the writer ventures to predict that such a book will, before long, be forthcoming. Such a book should describe the best method of making, recording, tabulating, and indexing time-observations, since much time and effort are wasted by the adoption of inferior methods.
69. The term “ rate-fixing department,” has rather a formidable sound. In fact, however, that department should consist in most establishments of one man, who in many cases need give only a part of his time to the work.
70. When the manufacturing operations are uniform in character and repeat themselves day after day — as, for instance, in paper or pulp mills — the whole work of the place can be put upon piece-work in a comparatively short time ; and when once proper rates are fixed the rate-fixing department can be dispensed with, at any rate until some new line of manufacture is taken up.
71. The system of differential rates was first applied by the writer to a part of the work in the machine shop of the Midvale Steel Company, in 1884. Its effect in increasing and then maintaining the output of each machine to which it was applied was almost immediate, and so remarkable that it soon came into high favor with both the men and the management. It was gradually applied to a great part of the work of the establishment, with the result, in combination with the rate-fixing department, of doubling and in many cases trebling the output, and at the same time increasing instead
of diminishing the accuracy of the work.
72. In some cases it was applied by the rate-fixing department without an elementary analysis of the time required to do the work, simply offering a higher price per piece providing the maximum output before attained was increased to a given extent. Even this system met with success although it is by no means correct, since there is no certainty that the reward is in just proportion to the efforts of the workmen.
73. In cases where large and expensive machines are used, such as paper machines, steam hammers, or rolling mills, in which a large output is dependent upon the severe manual labor as well as the skill of the workmen (while the chief cost of production lies in the expense of running the machines rather than in the wages paid), it has been found of great advantage to establish two or three differential rates, offering a higher and higher price per piece or per ton as the maximum possible output is approached.
74. As before stated, not the least of the benefits of elementary rate-fixing are the indirect results.
The careful study of the capabilities of the machines arid the analysis of the speeds at which they must run, before differential rates can be fixed which will insure their maximum output, almost invariably result in first indicating and then correcting the defects in their design and in the method of running and caring for them.
75. In the case of the Midvale Steel Company, to which I have already referred, the machine shop was equipped with standard tools furnished by the best makers, and the study of these machines, such as lathes, planers, boring mills, etc., which was made in fixing rates, developed the fact that they were none of them designed and speeded so as to cut steel to the best advantage. As a result, this company has demanded alterations from the standard in almost every machine which they have bought during the past eight years. They have themselves been obliged to superintend the design of many special tools which would not have been thought of had it not been for elementary rate-fixing.
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