Productivity Management - F.W. Taylor

 F.W. Taylor suggested many new ideas in productivity management in his writings.

Excerpts from:

TAYLOR, F. W., "A Piece-Rate System, Being a Step Toward Partial Solution of the Labor Problem,"

Transactions of the American Society of Mechanical Engineers 16, 856-903, 1895

The advantages of this system of management (Taylor's Piece Rate System) are :

The manufactures are produced cheaper under it.
The system is rapid  in attaining the maximum productivity of each machine and man

The system introduced by the writer, however, is directly the opposite, both in theory and in its results. It makes each workman’s interests the same as that of his employer, pays a premium for high efficiency, and soon convinces each man that it is for his permanent advantage to turn out each day the best quality and maximum quantity of work.

The writer has endeavored in the following pages to describe the system of management introduced by him in the works of the Midvale Steel Company, of Philadelphia, which has been employed by them during the past ten years with the most satisfactory results.

The system consists of three principal elements :

( i ) An elementary rate-fixing department.

( 2 ) The differential rate system of piece-work.

( 3 ) What he believes to be the best method of managing men who work by the day.

The advantages of this system of management are :

First. That the manufactures are produced cheaper under it, while at the same time the workmen earn
higher wages than are usually paid.

Second . Since the rate-fixing is done from accurate knowledge instead of more or less by guess-work, the motive for holding back on work, or “ soldiering ”, and endeavoring to deceive the employers as to the time required to do work, is entirely removed, and with it the greatest cause for hard feelings and war between the management and the men.

Third. Since the basis from which piece-work as well as day rates are fixed is that of exact observation, instead of being founded upon accident or deception, as is too frequently the case under ordinary systems, the men are treated with greater uniformity and justice, and respond by doing more and better work.

Fourth, It is for the common interest of both the management and the men to cooperate in every way, so as to turn out each day the maximum quantity and best quality of work.

Fifth. The system is rapid, while other systems are slow, in attaining the maximum productivity of each machine and man ; and when this maximum is once reached, it is automatically maintained by the differential rate.

Sixth. It automatically selects and attracts the best men for each class of work, and it develops many first-class men who would otherwise remain slow or inaccurate, while at the same time it discourages and sifts out men who are incurably lazy or inferior.

Finally. One of the chief advantages derived from the above effects of the system is, that it promotes a most friendly feeling between the men and their employers, and so renders labor unions and strikes unnecessary.

5. The modem manufacturer, however, seeks not only to secure the best superintendents and workmen, but to surround each department of his manufacture with the most carefully woven network of system and method, which should render the business, for a considerable period at least, independent of the loss of any one man, and frequently of any combination of men.

36. Yet it is the opinion of the writer that even if a system has not already been found which harmonizes the interests of the two/ still the basis for harmonious cooperation lies in the two following facts :

First . That the workmen in nearly every trade can and will materially increase their present output per day, providing they are assured of a permanent and larger return for their time than they have heretofore received.

Second. That the employers can well afford to pay higher wages per piece even permanently , providing each man and machine in the establishment turns out a proportionately larger amount of work.

39. The most formidable obstacle is the lack of knowledge on the part of both the men and the
management (but chiefly the latter) of the quickest time in which each piece of work can be done ; or, briefly, the lack of accurate time-tables for the work of the place.

40. The remedy for this trouble lies in the establishment in every factory of a proper rate-fixing department ; a department which shall have equal dignity and command equal respect with the engineering and managing departments, which shall be organized and conducted in an equally scientific and practical manner.

44. Yet this elementary system of fixing rates has been in successful operation for the past ten years, on work complicated in its nature and covering almost as wide a range of variety as any manufacturing that the writer knows of. In 1883, while foreman of the machine shop of the Midvale Steel Company of Philadelphia, it occurred to the writer that it was simpler to time each of the elements of the various kinds of work done in the place, and then find the quickest time in which each job could be done, by summing up the total times of its component parts, than it was to search through the records of former jobs and guess at the proper price. After practising this method of rate-fixing himself for about a year as well as circumstances would permit, it became evident that the system was a success. The writer then established the rate-fixing department, which has given out piece-work prices in the place ever since.

45. This department far more than paid for itself from the very start ; but it was several years before the full benefits of the system were felt, owing to the fact that the best methods of making and recording time observations of work done by the men, as well as of determining the maximum capacity of each of the machines in the place, and of making working-tables and time-tables, were not at first adopted.

46. Before the best results were finally attained in the case of work done by metal-cutting tools, such as lathes, planers, boring mills, etc., a long and expensive series of experiments was made, to determine, formulate, and finally practically apply to each machine the law governing the proper cutting speed of tools, namely, the effect on the cutting speed of altering any one of the
following variables : the shape of the tool (i.e., lip angle, clearance angle, and the line of the cutting edge), the duration of the cut, the quality or hardness of the metal being cut, the depth of the cut, and the thickness of the feed or shaving.

47. It is the writer’s opinion that a more complicated and difficult piece of rate-fixing could not be found than that of determining the proper price for doing all kinds of machine work on miscellaneous steel and iron castings and forgings, which vary in their chemical composition from the softest iron to the hardest tool steel. Yet this problem was solved through the rate-fixing department and the “ differential rate,” with the final result of completely harmonizing the men and the management, in place of the constant war that existed under the old system. At the same time the quality of the work was improved and the output of the machinery and the men was doubled, and in many cases trebled. At the start there was naturally great opposition to the ratefixing department, particularly to the man who was taking time observations of the various elements of the work ; but when the men found that the rates were fixed without regard to the records of the quickest time in which they had actually done each job, and that the knowledge of the department was more accurate than their own, the motive for hanging back or “ soldiering ” on this work ceased, and with it the greatest cause for antagonism and war between the men and the management

It is evident that this job consists of a combination of elementary operations, the time required to do each of which can be readily determined by observation.

This exact combination of operations may never occur again, but elementary operations similar to these will be performed in differing combinations almost every day in the same shop.

A man whose business it is to fix rates soon becomes so familiar with the time required to do each kind of elementary work performed by the men, that he can write down the time from memory.

In the case of that part of the work which is done by the machine, the rate-fixer refers to tables which are made out for each machine, and from which he takes the time required for any combination of breadth, depth, and length of cut

49. While, however, the accurate knowledge of the quickest time in which work can be done, obtained by the rate-fixing department and accepted by the men as standard, is the greatest and most important step toward obtaining the maximum output of the establishment, it is one thing to know how much work can be done in a day and an entirely different matter to get even the best men to work at their fastest speed or anywhere near it.

50. The means which the writer has found to be by far the most effective in obtaining the maximum output of a shop, and which, so far as he can see, satisfies the legitimate requirements, both of the men and management, is the differential rate system of piece-work.

This consists briefly in paying a higher price per piece, or per unit, or per job, if the work is done in the shortest possible time and without imperfections, than is paid if the work takes a longer time or is imperfectly done.

53. Whether cooperation, the differential plan, or some other form of piece-work be chosen in connection with elementary rate-fixing, as the best method of working, there are certain fundamental facts and principles which must be recognized and incorporated in any system of management before true and lasting success can be attained ; and most of these facts and principles will be found to be not far removed from what the strictest moralists would call justice.

54. The most important of these facts is, that MEN WILE NOT DO AN EXTRAORDINARY DAY’S WORK FOR AN ordinary day’s pay ; and any attempt on the part of employers to get the best work out of their men and' give them the standard wages paid by their neighbors will surely be, and ought to be, doomed to failure.

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.

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.

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.

76. But what is perhaps of more importance still, the rate-fixing department has shown the necessity of carefully systematizing all of the small details in the running of each shop, such as the care of belting, the proper shape for cutting tools, and the dressing, grinding, and issuing sairfe, oiling machines, issuing orders for work, obtaining accurate labor and material returns, and a host of other minor methods and processes. These details, which are usually regarded as of comparatively small importance, and many of which are left to the individual judgment of the foreman and workmen, are shown by the rate-fixing department to be of paramount importance in obtaining the maximum output, and to require the most careful and systematic study and attention in order to insure uniformity and a fair and equal chance for each workman. Without this preliminary study and systematizing of details it is impossible to apply successfully the differential rate in most establishments.

77. As before stated, the success of this system of piece-work depends fundamentally upon the possibility of materially increasing the output per man and per machine, providing the proper man be found for each job and the proper incentive be offered to him.

78. As an illustration of the difference between what ought to be done by a workman well suited to his job, and what is generally done, I will mention a single class of work, performed in almost every establishment in the country. In shovelling coal from a car over the side on to a pile one man should unload forty tons per day, and keep it up year in and year out, and thrive under it.

With this knowledge of the possibilities I have never failed to find men who were glad to work at this speed for from four and a half to five cents per ton. The average speed for unloading coal in most places, however, is nearer fifteen than forty tons per day. In securing the above rate of speed it must be clearly understood that the problem is not how to force men to work harder or longer hours than their health will permanently allow, but rather first to select among the laborers which are to be found in every community the men who are physically able to work permanently at that job and at the speed mentioned without damage to their health, and who are mentally sufficiently inert to be satisfied
with the monotony of the work, and then to offer them such inducements as will make them happy and contented in doing so.

85. No system of management, however good, should be applied in a wooden way. The proper personal relations should always be maintained between the employers and men ; and even the prejudices of the workmen should be considered in dealing with ]them.

The employer who goes through his works with kid gloves on, and is never known to dirty his hands or clothes, and who either talks to his men in a condescending or patronizing way, or else not at all, has no chance whatever of ascertaining their real thoughts or feelings.

86. Above all it is desirable that men should be talked to on their own level by those who are over them.

Each man should be encouraged to discuss any trouble which he may have, either in the works or outside, with those over him. Men would far rather even be blamed by their bosses, especially if the “ tearing out ” has a touch of human nature and feeling in it, than to be passed by day after day without a word and with no more notice than if they were part of the machinery.

The opportunity which each man should have of airing his mind freely and having it out with his employers, is a safety-valve ; and if the superintendents are reasonable men, and listen to and treat with respect what their men have to say, there is absolutely no reason for labor unions and strikes.

87. It is not the large charities (however generous they may be) that are needed or appreciated by workmen, such as the founding of libraries and starting workingmen’s clubs, so much as small acts of personal kindness and sympathy, which establish a bond of friendly feeling between them and their employers.

Excerpts from:

TAYLOR, F. W., Shop 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." 

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 employee, which does not make it apparent that their best interests are mutual, and which does not bring about such thorough and hearty cooperation that they can pull together instead of apart.

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 writer's 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 possibility of coupling high wages with a low labor cost rests mainly upon the enormous difference between the amount of work which a first-class 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 first-class man is known to all employers, but that the first-class man can do in most cases from two to four times (under favorable circumstances) 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 first-class 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.

It must be distinctly understood that in referring to the possibilities of a first-class man the writer does not mean what he can do when on a spurt or when he is over-exerting 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.

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.  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.

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 first-rate man of his class can do and thrive.

(c) That each workman, when he works at the best pace of a first-class 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 first-class men developed who otherwise would have remained second or third class all of their lives.

In almost all  complicated cases the large increase in output is due partly to the actual physical changes, either in the machines or small tools and appliances, which a preliminary time study almost always shows to be necessary. For the 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.

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 (pure manual work) that the results are evidently due to no other cause than thorough time study as a basis (to understand speed of work possible), to develop principles related to that work.

Task Management

The essence of task management lies in the fact that the planning and control of the speed problem rests entirely with the management based on scientific study and theory.

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."

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 first-class man works his best he will receive from 30 to 100 per cent more than the average of his trade.