Six Cardinal Areas for Industrial Engineering - Going Industrial Engineering

The applications of system in which we are most interested in industrial engineering will relate generally to six cardinal points.

First, the general institutions and form of management;
second, the provision and custody of material; 
third, the handling and payment of labor or men "; 
fourth, the care and maintenance of tools and machinery; 
fifth, the determination and direction of operations, or manufacturing methods; 
sixth, the recording of expenditures and costs that is, of money. 
Our seventh " M " markets belong to the commercial or sales organization, and though equally
susceptible to scientific treatment are not included in the scope of this study.

System is an ideal that is more or less perfectly embodied in innumerable concrete " systems " for handling each and all of these things. There is no universally correct and specific way of doing any one of them. Always beware of the man with the panacea. Ideals and principles are fundamental and fixed; methods and systems must vary with conditions. The systems that will succeed in any given case depend on the organization adopted in, and the circumstances surrounding, that case. Many misfits and troubles have resulted from attempts to force cut-and-dried systems that had succeeded under one set of conditions and in one environment, upon a plant differently organized and environed to which these systems were not adapted at all. There are, nevertheless, fixed principles that can be formulated and should be observed in any system we may adopt in any individual case.

Management, in its broad sense, includes everything in the entire range of this discussion. In its limited sense of the governing and directing body it is ordinarily (as already said) dominated too exclusively by ideals of " line " subdivision with insufficient " staff " co-ordination. Very generally, however, a broad staff or functional segregation appears in the adoption of what is called the " three-column form" of organization; that is, the management is carried on by three co-ordinated departments financial, manufacturing, and commercial. The division is elementary and logical. First get your money, next turn it into manufactured wares, then sell the product. Below this step, however, ordinary management is unstandardized. All effective work in the improvement of efficiency must begin here, either by replacing the existing arrangement by a " functional force " or by " co-ordinating with it in an expert staff."

Materials are generally supplied through a purchasing department, whose duty it is to provide all materials and supplies in the quantity and quality required by the production department, at the most advantageous price possible; and to verify its purchases to the auditing department for payment. Materials when received pass into the custody of the stores department, at the head of which is an official known as the storeskeeper or storekeeper. In a large plant there will probably be a general storeskeeper and a sufficient number of division or assistant storeskeepers and clerks to handle the work. The duty of the stores department is to keep materials in safe custody and orderly arrangement, to supply them to the departments of the factory on requisitions from proper authority, to account for their issue, to receive them again, in partly finished or finished condition, if the routine of the factory operation so requires, and to maintain an inventory of all material on hand. Sometimes finished product is delivered from stores on order of the sales department; sometimes the shipping department is distinct. Obviously both purchasing department and stores department must be in close touch with the needs of the production department, but the discretion given either of them to query or to anticipate production-department requisitions or wants varies greatly in different cases, and may be determined by the policy of the concern or the personality of the officials chiefly concerned. It is not uncommon, however, for the stores department to be charged with responsibility for maintaining at all times a sufficient stock not only of raw materials but of finished product. The manufacturing department then works always and only upon orders issued by the stores department.

The records of materials are usually kept by requisitions made out in multiple, separate copies going to the manufacturing and accounting officials immediately concerned, and by entering each addition or withdrawal in books or on cards accompanying each lot or kind of material carried in stock. The movement of material through the factory is usually directed and recorded by tags, accompanying each piece or lot, and distinguished by serial numbers connecting them with the order or job to which they apply. Multiple copies of these memoranda, sent ahead, serve to notify responsible officials further down the line what to look for, and act as detectors for any delay or discrepancy in arrival. This system is commonly called stock tracing.

Material in process of manufacture is commonly called either stock or stores. The terms are rather loosely used, but the best authority prescribes the use of the term " stores " for raw material and " stock " for finished product. This usage, however, is not universal, and very often " rough stores " or " raw stores " is used to designate unmanufactured material, and " finished stores," manufactured

material.

Labor, which was listed as the third cardinal subject of systematic handling, is very diversely managed. Some large concerns have a regular labor department or employment agency where applications are filed and examined, and by which men are engaged in such numbers and at such times as, the managing officials direct. In other cases the heads of departments make their own engagements and discharges. Usually the discipline and work assignments of each employee depend upon his immediate superior, who may be a very minor official, such as a gang boss or sub-foreman. Many disciplinarians consider that the power of promotion or discharge is necessary to the man in immediate command. There are, however, great dangers of injustice, and of the exercise of favoritism or spite disastrous to efficiency of the working force as a whole, if too much power is entrusted to petty officers. I think this is on the whole the safer view to adopt. The assignment of work, even, when not determined by general routine, is now sometimes advantageously directed from a central works office, where a work dispatcher has every machine in the shop displayed before him on a board, with its jobs in hand or accumulated systematically tabulated on slips, and he directs the next movement for each man and machine on the floor, as a train dispatcher moves the trains on a railroad.

The individual jobs are usually designated by numbers connecting them with the work to which they apply. The time each man works is usually recorded by a representative of the accounting or auditing or cost department, called a time clerk or a timekeeper. Very generally each workman registers his entrance and departure by punching a time clock or some similar automatic recording device, so that

the total time for which he is paid is indisputable. The division of his time among various jobs (if his work is of such character that it is divided among several jobs) is noted either by himself, by his foreman, or by the time clerk, who then makes frequent rounds of the shop and visits every man often enough to keep close track. These time records, like the material records, are usually kept on individual cards, which can be assembled afterwards for such tabulations and cost determinations as are desired and may be kept as long as deemed advisable for further reference. The system of payment is determined by the management in the light of such appreciation as the managers may have of the virtue and benefits of the several advanced wage systems, and under such limitations as the prejudices of the men or the effective restriction of the union may require.

The fourth cardinal point listed for systematic direction was the care and maintenance of tools and machinery. The larger mechanical equipment, power transmission, etc., is too often left more or less vaguely to the engineering or mechanical department, from whom it devolves upon the foremen. There is, however, a generally recognized and almost universally established institution called the tool room, which has two separate functions; one is the custody and issue of small tools, which are provided, ground, kept in order, and given out to the men as needed, account being kept by hanging a brass check representing the tool on a hook bearing the workman's number. The other and larger function 'of the tool room is the making of standard and special tools, jigs, fixtures, etc., and the repair of machines and machinery. The province of the tool room, however, is seldom extended widely enough and the tool-maker's knowledge of the most efficient operation of machines and of the principal causes of waste and loss of time is seldom deep enough, or his authority to institute reforms and is seldom great enough, to make the tool room adequate to drive the plant at its highest capacity. Here is an opportunity for most profitable use of the staff specialist.

The direction of methods, our fifth cardinal point, is in a still more unsatisfactory condition. It is left sometimes to the men running the machines, sometimes to their foreman or to a special functional foreman, sometimes to the tool room, sometimes to the drafting room, and sometimes to the engineering department or mechanical department at large. Here is another broad field for the staff specialist.

Systematic supervision of money matters, our sixth cardinal point in manufacturing organization, exists in two directions. Both are based, in part at least, on the same data, but their scope and purpose are quite diverse. The first of these functions is exercised by the auditor's department. Its purpose is simply to connect every expenditure with an actual bona fide transaction material bought and vouched for, wages paid for services proved, royalties paid on a verified contract, machines purchased, buildings erected, etc. Time and material tickets coming from the shop are merely vouchers to the auditor, to warrant his O. K. of requisitions on the treasurer for the payment of bills or the drawing of payroll checks. Beyond this, he is not in the least concerned officially. If John Smith is certified on the payroll for 60 hours, as proved by the time clock, and at 25 cents an hour as certified by his general foreman, the auditor approves his payroll check for $15 without further question.

But the second department concerned in money matters has a different function; this is the cost department. The time and material cards, having served as auditor's vouchers if necessary, are taken in hand by the cost department and sorted by numbers so that all cards belonging to any particular job, machine, or desired item of product fall together. From these the complete material and labor cost of any piece or product (or by proper prearrangement, of any part of a unit of product or of any operation upon any part) can be figured up and recorded. It is part of the function of the cost department not merely to connect expenditures with certain manufacturing accounts as the auditor does, but to determine by comparison whether the expenditure and the thing secured by it are in fair proportion. The auditor went no farther than to find that John Smith put in 60 hours by the clock. The cost department divides up this 60 hours, job by job, and it can or should compare John Smith's time on each job with recorded times made by other men on the same jobs. If he has been soldiering and has done altogether in 60 hours only what the records show that other men have previously done in 25 hours, the facts are made clear and proper action can be taken.

The cost department, properly conducted, may thus become a mine of valuable information, first for the shop superintendent in helping him to prove the comparative worth of his men, and next for the commercial or sales organization, because it shows not only what margin of profit exists and affords a guide to possibilities of meeting competition, but it also permits close estimates to be made on new work, by a comparison with similar jobs in the past and by compiling unit prices from which the costs of new models may be built up. 

Updated on 26 July 2019, 18 September 2013