A very important matter in connection with the Reward System is that of deciding the right kind of worker for the different classes of work.
For work requiring much skill and close application, or work which requires skilled handling, the highest class of worker is necessary and the job rates will be high. For work which is automatic or semi-automatic, boys or girls may be employed. For work such as rough drilling or heavy unskilled handling, men who have no special skill or training may be suitable. But the point where one grade of labour merges into another is not easily defined and needs very careful consideration.
The circumstances of different trades vary so greatly that it is impossible to apply any rules in such general notes as these. It must be left to the employer, the workers, and their trade-unions, to settle these grades between them, and from the trade practice there should not be much difficulty.
One thing stands out—namely, the worker whohas a continuously high efficiency in any grade is easily distinguishable, and would be selected to pass into a higher grade with higher wages when opportunity occurred.
It may be asked how it is that a firm can afford to begin paying reward when a job is done in twenty hours, while the time study shows that the same job can be done in twelve hours?
The reply is, First, that under ordinary day work the waste of time on the job is so great that the job would certainly take longer than twenty hours; second, that by giving reward there is a decided incentive for the worker to do the work in a shorter time; third, that twelve hours is the shortest possible time with a good average worker working under the most favourable conditions, and this happens so seldom that it may be considered accidental, though it is necessary to observe these conditions when making a time study in order to find an absolute basis on which to pay reward; fourth, for every hour saved on the job the overhead charges are reduced proportionally, and this lowers the works cost.
If a job takes twenty-four hours under day work, it is clear that, if the same job be done in nineteen hours, some reward may be allowed, while if it be done in fifteen hours an extra bonus may be given.
The training in efficiency habits of work is also very valuable, and means economy all round. Aman not used to these habits may expend twice as much energy and produce half as much work as an efficient man.
The time study is in itself an absolute safeguard against cutting times. It is quite impossible for a job to be done in less than a certain time by an average worker after all the elements have been studied and tested. So long as the elements do not change, the times must hold good, and a new study will confirm this if any doubt arises.
So that if the workers are all taking high rewards it is clear proof that they are of high efficiency.
Suppose a firm cuts the time with the object of getting more profit. One result is shown on p. 27. Another result is that the good workers will leave, because efficient men can always get good jobs elsewhere.
As a matter of fact, however, rates are practically never cut. It does not pay to cut rates, because if efficient men leave, and only inefficient men are left, the firm loses heavily, and their own time studies together with the general efficiency of the workers show how valuable their men are.
This is why the time study is a decided safeguard against cutting rates.
One method of rate revision sometimes occurs. When a job is found to be rated too highly from some cause or other, and the worker is taking excessive reward on that job, a change is made in the conditions of the work and the job is restudied.Two reasons are given for this procedure: first, that it is unfair to the other men for one man to be taking exceptionally heavy reward, and, second, under the new conditions the job is still on exactly the same basis as all other jobs in the factory, and standard efficiency with its proportionate reward can be made just as easily as in other cases.
There is another safeguard. The relation between standard and reward times is so arranged that when a worker reaches standard he gets at least 25 per cent. of the job rate. This is an accepted principle, and must be conceded always. It is an irreducible minimum in connection with the Reward System.
It may be said that, however much the principle is accepted, it does not follow that the employer will stick to it.
But he must! If he does not do so, what is the alternative? Either he gives less than 25 per cent. reward or he gives none until the standard time is reached. In the first case, if he gives less than 25 per cent., reward is not worth working for, and the worker will not trouble about it, thereby rendering the whole system useless. If the worker gets no reward until standard time is reached, the effort required by the men is so great in order to get reward that it is not worth it, and the men do not try for it.
So that this principle must be accepted by the employer whether he likes it or not, if the system is to be a success.
It is not to the interest of the employer to treat the worker badly. Firms with brains and foresightenough to adopt time study methods are not going to spoil the whole business by getting the workers up against them. It is more to the firm's interest than to the worker's to get a continuously high efficiency; that is why time study and reward methods were introduced by the employers, and not by the workers.
It must be clearly understood that the Reward System does not pretend to be by any means a solution of all the difficulties between employer and worker.
Without mutual good-will no system will work satisfactorily. What is claimed for the Reward System is that it provides a basis upon which a good understanding and a mutual interest in increased production can be built up and maintained.
The time study shows beyond argument the very quickest time in which a job can be done by an average man with the means at his disposal. If this is followed up by a rational organisation, the Reward System will be entirely successful. But if an employer endeavours to foist the time study and Reward System on an existing rule-of-thumb organisation, it will undoubtedly fail, and will cause deep suspicion in the mind of the worker as well as being wholly unsatisfactory to the employer. It will be looked upon as an endeavour to get more out of the worker without an adequate return, and this, as a matter of fact, is just what it will be.
One thing is certain: No employer will adopt the Reward System unless he sees clearly that it is to his direct financial benefit, and there is no reason why he should. He, on his part, would be foolish to take on an increased responsibility without adequate return.
It follows, therefore, that the system is part of the rational organisation of production, and it cannot be properly carried on without such organisation.
Even when such a system is adopted, there are ample opportunities for letting things slide and for unfair conditions to creep in. This is why the worker should understand the system, because then only will he be able to assert his position and see that conditions are fair.
The following are some of the things to watch out for:
Time study must not be used for speeding up day workers. There is a tendency to do this when it is found that a job can be done in half the time, but it must be remembered that conditions are quite different and the incentive is lacking. The remedy is to put all workers on reward as far as possible, and to adopt a profit-sharing or other scheme to stimulate day workers.
Overstrain and fatigue must be carefully guarded against. This means, as a rule, guarding the worker against himself. He wishes to earn as much reward as he can, but if he feels tired out at the end of the day he is doing too much, and he will wonder why his efficiency drops. One part of the system is toconsider fatigue, and to make an allowance on the base time to cover necessary rests during the day.
Cutting the rates need hardly be mentioned, because it is very bad policy on the part of the employer, and always means loss of efficiency and hence loss of profit.
The question of keeping machinery in order and bringing up supplies is one that the worker must watch. It is no use trying to reach a standard time when one gets let down by lack of attention on the part of other people. It is true that a day time allowance may be given, but this is not altogether satisfactory. It means that reward cannot be earned for the day time period, and, besides that, there is a possibility of not receiving the allowance. It is possible, also, that the superintendent may refuse allowances, and so dissatisfaction results. Day time allowances and allowances for exceptional conditions (such as bad metal), which increase the machine time, are open to abuse. If a worker reach 99·5 per cent. efficiency or thereabouts, it is quite possible that an unfair allowance of an hour, or even half an hour, on the job will put him over the 100 per cent. efficiency mark, and his reward rate would be considerably increased. With regard to bringing up supplies and attending to slight machine breakdowns—broken belts, for instance—the labourer or other person responsible should be put on reward, his reward being in proportion to the average reward of the workers he serves.
The worker must see that proper allowances are made for bad work which he is not responsible for.For instance, if he is on small parts on an automatic machine, and the inspector throws out several pieces as spoiled, it may be the fault of a bad adjustment which the worker cannot help. It is the worker's duty to stop his machine and draw attention to the fault; but if it can only be found on close inspection in the inspection room, and if it consists of, say, a capstan becoming loose, it may be impossible for the worker to detect the fault while the work is in process, and it is no fault of his.
The proper counting of the quantity of work done is a point that must be insisted on. On large work it is simple enough, but on small parts that are counted by weighing it is easy to make serious mistakes.
Proper check must be kept on the gears used for a particular job. On automatic machinery a change of gear is frequently necessary, and if the change is not properly recorded it may mean that cycle time—the time of all the elements done by the machine on that part—is quite wrong, and an efficiency much too high or too low is the result.
Reward is reckoned either on each job taken by itself or on the net result of the week's work. The former is better for the worker, but it is not always fair to the employer, because there is a tendency for the worker to take it easy on difficult jobs where there is little chance of earning reward. With an exact time study and close attention to instructions, such cases, theoretically, should never occur; but they do, because it is impossible to get every job on exactly the same basis, and the worker after alittle experience knows what jobs are easy and what are difficult. In some shops the experiment of deducting inefficiency from efficiency has been tried. That is, suppose a worker was 10 per cent. below reward efficiency one week, then that 10 per cent. has been deducted from his efficiency the following week before reward has been allowed. Result: Disaster! The fairest way is to take the balance of efficiency on the week's work, and if a particular job is a bad one from the worker's point of view, he can always draw attention to it.
Another important matter is that of determining the class of work which is to go to the worker. Automatic work will go to comparatively unskilled workers, but the dividing line between classes of work is sometimes a very fine one. Skilled handwork must be given to the skilled worker, of course; but it is impossible to lay down any rules in this connection, and the worker must keep his eyes open, and either draw attention to doubtful cases or consult his trade-union.
The greatest difficulty is in fixing the allowance on the base time in order to obtain standard time. It is easy to fix it so that the worker cannot reach standard time, and that means a loss of efficiency and of reward. This is essentially a point for trade-union interference, and it is here that the supreme value of the time study is best appreciated.
Most of the foregoing items are in connection with the practical working of the system, and it is to the interests of both employer and worker thatall such interferences with production should be prevented.
Each trade will have its special loopholes where miscalculations can creep in, and the worker must watch for these and have them corrected immediately they are discovered.
It is sometimes stated that under time study methods a man cannot attain the same skill as a day work man, and that he loses what skill he had if he becomes a "team" worker.
Let us consider this contention.
Suppose a man leaves a "reward" shop and goes to work in a day work shop; is he any less efficient under day work because of his training under the Reward System?
Now, in the first place, he has been trained and used to care and diligence, to working to definite instructions. Is that any disadvantage to him? It is clear that such an experience is a distinct advantage. But has he the same knowledge and adaptability and initiative as the older-fashioned worker? Can he tackle a difficult job with the same chance of success?
Well, what difficulties has he to face? It does not follow that because he has been working to instructions he remains in ignorance of the essential factors of his trade. On the contrary, instructions scientifically worked out give him far more knowledge than if he is compelled to work them out forhimself. The men who work out these instructions are highly paid men who have all the advantages of a shop training and a scientific engineering education combined, and this is an expensive and arduous business. If a man prove a failure, one may be sure he will not be allowed to continue planning out such instructions as we are discussing.
Therefore one must assume that the men who make out the instructions have studied every element of the case. The brains of these men are in the methods and instructions used by the workman, and if the latter is worth his salt he will soon know far more than the old rule-of-thumb man.
If the worker is a man of ordinary common sense, he cannot help but take notice of the ways in which jobs are done; of the best and most satisfactory tools, both shape and material; of proper speeds and proper depths of cut for roughing and finishing; and many other details that are constantly before him.
"But this system converts the workman into a mere machine, and already his work is too dull and mechanical!" That has been said, but not by anyone who understands the system or who has had direct experience of it.
That work underpresentconditions is often dull and mechanical is only too true. One of the reasons why this Reward System is so attractive to the worker is because it removes these conditions. When a man knows he is being paid for efficiency, the work immediately ceases to be dull; as soon as a man is interested in producing as much work as he can, that work immediately ceases to be mechanical.Some jobs will always be mechanical and dull, and the only thing to do in such cases is to change the worker at frequent periods.
The conditions under which the Reward System is run must be agreeable, because it means a loss of efficiency if they are not; and when a man is working under agreeable conditions, when he knows he gets a reward for his efficiency, when he knows that rates cannot be cut, when he knows he is doing no injury to his fellow-workers by earning big rewards, he is happier at his work, he takes greater interest in it, he comes to it with a certain degree of pleasure, and he leaves it with far less fatigue and with greater contentment than under any other system.
One can say with certainty that a man who is a good workman under any other system will be a better workman under the Reward System. A bad workman will be bad under any system, but such a one can "find himself" much more certainly under the Reward System than under any other. In many cases, too, a very moderate workman will find some one particular job where he can do good work and earn good money. He will want to stay on that job, of course, and if he keeps up his efficiency the employer will agree that he shall stay on it.
There is one remarkable thing that no other method of wage payment shares—namely, it is to the direct and immediate benefit of both worker and employer that the greatest efficiency be obtained.
Letus try to see straight on this point.
First as to the relations between them. The employer wants to get as much profit as he can, and, as wages are usually a large and a plastic item in his expenditure, he always tries to cut down that item either by lowering wages or by getting more work produced for the same wages. "Low labour cost" is the continual cry of the employer.
Next, the average worker wants as much wages as he can get for as little work as possible. He thinks that the less work he does the more there is for somebody else, and it suits his nature to go easy. "High wages and short hours" is the cry of the worker.
Is there anything to choose between them? Only the fact that, as the employer's profits are so high and the worker's wages are so low, there ought to be a better distribution of the wealth produced. Morally there is nothing to choose between them, because each is trying to rob the other. They cannot help it. Neither is to blame altogether; it is the fault of the present industrial conditions.Under these conditions the employer cannot give to the worker a fair share of the wealth produced.
To have a factory it is necessary to have capital. That capital has been obtained from the surplus wealth produced by the worker. The worker cannot work without the capital necessary to provide the tools to work with and the material on which to work. Interest must be paid on capital in order that the employer may live, and in order to accumulate more capital, because there are more workers coming into being every year, and they will want work and there must be capital to provide the means necessary for that work.
And so the vicious circle goes on. It is not the fault of the employer; it is not the fault of the worker. It is, I repeat, the fault of the system.
Take any worker from his work and place him in charge of a factory with a large capital, and ask him to run the business in competition with other businesses; he would soon find how keen a man must be in order to keep the business going successfully. Suppose the profits fell off, what would our worker-employer do? Cut down wages, of course!
There is no getting away from it, and we must look the conditions squarely in the face and blame neither employer nor worker overmuch.
Now, here is where the Reward System scores. The employer gets "low labour costs"; the worker gets "high wages and shorter hours," with good conditions and greater comfort added.
I am quite convinced that there will be less antagonism between them under the Reward Systemthan under any other. It keeps both up to the mark, and it means a mutual dependence on each other and a mutual interest in high and efficient production. An employer who pays wages under the Reward System soon finds that he has adjusted his whole establishment and sales policy on this basis. If he goes back to day work or piece work, the labour costs go up instantly. So he must stick to the system: it pays him to stick to it. Yet he dare not make things too harsh for the worker; if he tries to do so, down comes efficiency. And the essential items that make for efficiency are reasonable hours, pleasant conditions of labour, and a reward in proportion to that efficiency.
The trade-unions must be properly organised to meet the new conditions.
The trained engineers of the unions should be thoroughly up to date in their knowledge of all the branches of the trade. In connection with engineering workshops, they should be acquainted with the latest practice in all kinds of machines and tools, tool steels, methods of cutting, and everything else bearing on the working of metals.
Such a trained engineer is worth a good deal to the union, and he should be paid highly. The saving to the union cannot be adequately calculated. In many cases an exhaustive inquiry into conditions of work would often prevent an expensive strike or would smooth out difficulties thattended towards a strike. Such a man should be paid anything from £500 to £1,000 a year. This sounds a lot, but it is absolutely essential for the unions to be in a position to let the employer see that they know as much about the business as he does—perhaps a bit more—and they cannot get the sort of man they need for less.
The trade-union must also see that time studies are properly made. This will be no part of the union's duty until disputes arise. If there is a general complaint from any shop that time studies are unsatisfactory, the trade-union engineer should be sent to the factory to study one or two representative jobs.
He will do this side by side with the employer's engineer, and he must allow the firm to choose the worker (who would, of course, be a union man), so that there can be no complaint of unfairness and no accusation can be made that the union desires to impose conditions on the employer.
A comparison between the times thus obtained and the firm's standard times will show at once whether the complaint is well founded.
The allowances on the fastest time in order to obtain standard time is a matter more open to arrangement. It is, in fact, one of the most vital matters in connection with the time study system, and one where the most unfairness will take place. But an approximate check may be obtained because the handling times of each element of the job can be totalled and the cutting times totalled, andaccordingto the circumstances of the case the allowances can be arranged.
The relation between reward and standard times is a simple matter. It is only necessary to see that reward when standard efficiency is reached is at least 25 per cent. of the day wage. That is to say, if wages are 20s., the reward when the work reaches standard efficiency should be 5s.; if wages are 30s., reward should be 7s. 6d.; if wages are 40s., it should be 10s.
This Reward System, when based on time study, is a part of what is called "scientific management," and cannot be carried on without proper departments for standardising products and methods of production, planning and routing the work, attending to tool repair and replacement, examining and maintaining machine tools and driving gear, keeping stores and stocks, inspecting the product, costing production accurately, preventing waste, keeping the sales and publicity department up to a high standard, and watching every phase of the work so as to keep everything up to a high pitch of efficiency. All this does not directly concern the worker. His chief interest lies in whether his conditions of work are improved, whether he suffers less fatigue, whether he gets more wages, whether he does his fellow-worker no injury in earning high rewards If he is satisfied on these points, then all the rest does not concern him.
Now, scientific management is not some fancifulsuggestion that the worker may accept if it pleases him, and refuse if it doesn't. It is here already, and the war will cause an enormous increase in the number of firms adopting it. And where scientific management is introduced, efficiency in production follows—that is what it is for. The point is, is the worker going to accept it and its consequences, understanding it, seizing its good points, rejoicing in increased efficiency, increased wages, and increased opportunities of a satisfactory life which these things provide, or is he going to resent it and try to fight it as his fathers fought against the introduction of machinery?
If he chooses the latter course, it means bitter antagonism, suspicion, Labour troubles, instability of employment, low wages, loss of earnings, and the whole of the intellectual forces of the country will be against him, because the conditions after the war will demand industrial peace if we are to maintain the commercial position we had before the war. And in the end it will only mean a sullen acceptance of defeat.
Would it not be better for the worker to get a clear understanding of the system, welcome it for its advantages, and reserve all his strength and power to adjust and preserve the bases upon which the payment of labour depends in the various trades of the country?
It is quite true that the worker will work harder and will produce considerably more; it is equally true that prices will be reduced in consequence, and therefore more men will be required to makemore articles for the increased demand that is bound to follow the reduction in price. In the long run, the system will mean employing more men than would be employed under present methods, and they will be men of high efficiency, and on the average of a better class, such men as will greatly increase our national assets, and such as will maintain our reputation in the markets of the world for the excellence and durability of our manufactures.
In the clash of interests that will prevail for a time when the war is over, the worker will have to decide whether to be the controller of his own destinies or whether to become servile. Much depends on the attitude of the skilled worker towards the capitalist. The burden of debt left by the warmustbe shouldered, and both interest and repayment of loans must come from somewhere. Unless the worker is to be ground to the dust, he must assert himself; but he will be utterly ignored if a selfish and stubborn attitude be adopted, and he will be driven by stress of the nation's adversity to accept what is offered to him by the more far-seeing and powerful members of the State. This means losing all the freedom that he fought for in the great war, and it will put back the worker's progress for an indefinite number of years.
Let him follow up the great sacrifices he has made during the war by an intelligent understanding of the altered conditions, and the worker will take an honoured place in the affairs of the State and share its responsibilities and its benefits. If he is to take that place—and no man has a better right to it—if he is to have a voice in the councils of the nation that will compel attention and respect, will it come by antagonism to progress and indifference to the general welfare, or by organisation and efficiency?
The reply is obvious.
The organisation is the duty of the trade-unions, and the Reward System is a method of providing the efficiency. These will compel the worker to take a greater interest in his surroundings and in the way he is governed. He will resent inefficiency in civic and national matters when he realises how he suffers from its consequences and what perils it brings upon him.
And it must always be remembered that the worker will owe nothing to the employer in attaining this position; there will be no paternalism or "giving shares for nothing" about it. It will be clean, honest hard work and endeavour, and the employer will not only be giving nothing away, but will actually profit by it.
And while each benefits by the efficiency of the other, the State will benefit by both.
How will this time study and Reward System affect the position of the worker?
This is a very serious problem.
It is evident that a transmutation of labour is taking place and will proceed more rapidly after the war.
Workers on the whole are becoming less skilledas craftsmen, and machine attendants are taking the place of hand-skilled men.
it is quite impossible to stop this change. But what cannot be avoided may possibly be controlled, and the trade-unions should endeavour to direct these economic changes rather than to obstruct what is inevitable.
Handicrafts can never wholly cease to exist, but the skilled fitter, and more especially the skilled turner, finds machinery and methods of using machinery encroaching more and more on his particular domain.
An unskilled man is given three or four weeks' tuition, and then, if he shows sufficient intelligence, he is put on a machine with an instruction card. The setter-up sets up the machine and gives advice and surveillance, and the man is henceforth a tradesman, getting full wages for that class of work.
The systemisation of production thus means a great increase in the average skill of the workers as a whole. There are about 4,000,000 skilled workers who are members of trade-unions at the present time, and this number will be greatly increased if the machine attendants of the near future are absorbed by the unions. If the trade-unions are to control the organisation of Labour, this new class of semi-skilled workers must be absorbed either in one of the older unions, such as the A.S.E., or else a new union must be formed for its accommodation. The former would be by far the better arrangement.
At any rate, it will be fatal to allow this growingclass to be at the mercy of the employers. Such a state of affairs will mean not only the exploitation of the new class, but the destruction of the old, because the more intelligent men of the new class will be selected and trained to take the place of trade-union men. This is a natural process, and is not aimed at the destruction of the unions.
The general result will be to transfer craftsmanship from the craftsman to the standards book. Then the instruction card will be made out from the standards book and handed to the machine attendant, who will work to it, and will earn something in excess of his weekly wages according to his diligence and care in working to the instructions.
A new profession will result—indeed, has already resulted—one that will employ many intelligent people: I refer to the profession of the rational industry organiser.
It will mean, further, a great increase in the clerical staffs of firms who adopt these systems.
Yet, again, it means a new trade, the trade of inspector, a trade especially suitable for women on account of the lightness of the work and the delicate handling of the gauges.
And, above all else, it means a great increase of production per man, with a consequent lowering of prices. Now, a lowering of prices always means a greater demand, which in its turn means more workers. Speaking generally, any article made in very large quantities is sold to a great number of people, which means that it is sold largely to theworking class. Therefore the reduction in price of an article tends to be to the advantage of the workers—it would be more correct to say the better-paid workers.
But now we come to the vital point in connection with all industry and industrial systems—namely, the ultimate advantage or disadvantage to the workers as a class.
The employer will, of course, endeavour to reduce wages, because the semi-skilled labourer need not be paid so highly as the fully skilled craftsman.
It is impossible to say what the trade-unions will do—whether they will accept the situation and adopt sliding scales of wages for different classes of labour, or whether they will insist on the same wages being paid to all union members.
Of course, semi-skilled labour would be engaged almost always on repetition work—work, that is, which lends itself excellently to the Reward System. This system means, as I have shown, an addition to the day rate of wages, and therefore the unions might arrange for a lower wage to be paid to semi-skilled workers, and rely on individual efficiency to bring wages approximately up to the union rate.
In such a case it would be necessary for the unions to see that at "standard efficiency" the wages received were at least equal to the day rate for skilled men, and that the tasks were set in such a manner that this efficiency could be reached without excessive strain.
Skilled men would get the ordinary union rate, and if put on reward their individual efficiencywould bring the earnings to considerably more than the highest earnings of semi-skilled workers.
This arrangement should be a satisfactory compromise between the employer and the worker, but it can only be brought about by the Reward System, or some similar method, and under trade-union control.
Unless such a compromise is attempted, industry will soon be in a state of economic warfare, and the division of the workers into skilled and semi-skilled camps will be disastrous. If the trade-unions lose control over labour-not only skilled, but semi-skilled labour also—the natural tendency will be for the employers to coerce and intimidate the workers into accepting lower and still lower wages. Our tremendous war indebtedness will provide the excuse, and a "free labour market" will contribute to the success of this reduction.
There is a certain level of necessity to which wages always tend. If wages are high, they tend to be reduced; if they are low, they tend to increase. The tendency to reduction is due to the endeavour of the employer to lower costs, and the acceptance, under pressure, of a lower wage by the worker so long as the wage does not fall below the limit of absolute necessity. The tendency to increase is due to the discontent of the worker when wages are below the necessity level, this leading to strikes, slacking, and inefficiency, which compel the employer to raise wages in order to avoid excessive loss. I am speaking here of skilled labour, where there is always more or less of a demand for workers. Inthe case of unskilled labour, where the supply is always considerably in excess of the demand, wages are always below the necessity level.
There is a constant "regression towards mediocrity," to use Galton's phrase—in other words, a constant tendency towards the average. It is because this average at present is an average ofnecessityinstead of an average ofreasonable comfortthat Labour troubles recur so frequently; the slightest variation in the price of necessary articles immediately affects the purchasing power of wages.
It is evident to allunbiasedpersons that no one can be efficient without a certain minimum income based on comfort; a minimum based on necessity means inefficiency, because no worker can be really efficient when haunted by the constant fear of debt and misery and starvation. And it is also evident that this minimum of comfort cannot be based on the money a man receives as wages, but on what he needs. What constitutes need is open to argument, but there are certain items of necessity which are beyond dispute.
No matter where a person lives, he needs a good roof over his head, food to eat, clothes to wear, fuel, household necessities, and a surplus for emergencies. The cost of living differs in various parts of the United Kingdom, and therefore there should be a scale of wages for each district, based on the purchasing power of wages in that district. This is recognised by the trade-unions, and in consequence union wages are higher in London than in provincial towns.
In each district the amount of wages should be based on the price of perishable articles—food, fuel, household necessities—in that district.1It is an easy matter to record the prices of these necessities: and if an annual revision of wages be made, the employer cannot complain about excessive increases, because between one year and another prices do not vary sufficiently to cause any great difference, and all manufacturers would be affected the same way.
Fixed items, such as rent, should be revised every five years or so.
Such an arrangement would mean basing wages on what may be termed "reasonable comfort" instead of on necessity. This alteration of the basis of wage calculation, together with the payment of a reward for efficiency, would have a remarkable effect in lessening the difficulties between Capital and Labour, and would make for a permanent and progressive industrial peace.
Whenever scientific management is criticised, there seems to be a tendency to avoid a comparison between the conditions of work under scientific management and otherexistingconditions. The comparison generally drawn is between scientificmanagement and some non-existent, more or less ideal, condition imagined by the critic.
But we have to deal with immediate practical problems; with prevailing conditions; with a non-producing investing society which is constantly seeking profits; with masters who are in open or veiled antagonism to the workers; with workers who have no chance of obtaining a real education, and whose minds are so confused by the contradictory statements made in the Press—their only means of becoming acquainted with the broader aspects of citizenship—that they can rarely exercise a balanced judgment on any subject. Any scheme of work and wages must take into account these things as well as the present-day desires and ambitions of the average worker, if it is to be of any real use or if it is to assist the worker, consciously or unconsciously, towards the attainment of what are considered better things.
The worker cares more for money than for anything else. In this he is singularly like most other people. The æsthetic nature of his surroundings when at work make little appeal to him, and no appeal at all if two or three shillings a week are in the balance against it. He does not know how his health improves and his efficiency increases when he is in pleasant surroundings, and he will have no hesitation in leaving a pleasant factory for a dismal one if he receives a slight increase in wages by doing so.
Certain employers—Rowntree, Cadbury, Lever, for instance—after becoming wealthy, try to improve the condition of their workers. Increased efficiency is not their aim so much as making the lives of their workers pleasant and happy. But it is impossible for all firms to be wealthy, and there are few even among the wealthy who care how their workers live; hence the multitude of repellent workshops up and down the land.
Scientific management, however, starts in at the beginning with pleasant conditions because it pays to have them. It is frankly utilitarian, and if slavery in a dark house resulted in greater efficiency, then that method would be adopted. But since itdoesmean healthier and happier conditions, and more wages and greater opportunities for a fuller life, why cling to worse conditions while dreaming of some vague future state which is utterly outside present practical possibilities?
That Capital is necessary is evident to everyone. Whether the capitalist is necessary is open to argument, but we must accept him for the present whether we like it or not. And, accepting him, we must acknowledge that he has certain rights and privileges—rights and privileges which so many of us are seeking for ourselves; for instance, the right to control his capital, to increase it by any legitimate means, to dispose of it in any way he chooses.
One of the ways of increasing capital is by lowering the cost of production and thereby gaining a wider market. Better organisation and the introduction of automatic machinery enable the capitalist to do this. He risks his capital in the hope of greater returns, and no one can deny him theright to better his organisation, to use his brains and energy and wealth to attain this end.
One of the most striking and successful methods of organisation is this of scientific management, of which the Reward System is a part. To oppose the system, to oppose theintroductionof machinery, is not to make things better. If one could say we will not have efficient management, we will not have automatic machinery, the case would be different; but this system and this machinery were being introduced before the war, and the installation of automatic machinery has been increased enormously since the war began. This class of machinery has come to stay, and, now that the urgency of war work has forced engineers to realise their possibilities, they are looking forward to the application of automatic machines to thousands of jobs that were previously done on general machines.
Now, automatic machinery is the same under any system of management or wage payment. The same amount of manual skill is required, and the same amount of mental application. But whereas day work means constant close supervision by the foreman, and piece work means mutual dishonesty, the Reward System means a keen interest in both the quality and quantity of the work produced.
Under what system can work on automatic machines be made pleasant? The usual reply of the idealist is to draw a comparison between handicrafts and automatic machinery, dwelling on the skill and interest and beauty of the one and the deadening monotony of the other. But when aman is compelled to take up a handicraft for the sake of a living—and this alwayswasthe case—there is not so much difference between being compelled to work on an automatic machine and being compelled, for example, to throw a shuttle through the frame of a hand loom, which is but a man-driven machine, after all. And, to be fair, the comparison should be completed, and the comparative luxury enjoyed by present workers set against the bare, cheerless existence of the artisan of the Middle Ages.
It is assumed that the craftsman of those days had a tremendous pride in his work, but it is to be doubted whether he was really so proud all the time of the work whereby he earned a miserable pittance. How many of those workers would gladly have given up their beloved crafts and tended automatic machinery if they could have obtained the conditions of the present day by doing so!
The conditions obtaining in the Ford motor factories at present show what influences and governs the actions of the worker. Mr. Henry Ford put into practice a bonus scheme which included all workers who had certain qualifications. For some time after this became known the Ford Company received over one thousand letters a day from workers desiring employment. The conditions of the work did not weigh with them at all, but, Mr. Ford being what he is, the conditions were, of course, excellent. This gave the Ford Company the pick of the workers of the United States. As far as can be ascertained, there is great satisfaction among the Ford workers, and it is considered aprivilege to get a situation with the Ford Company. Now, an essential feature of the work in this firm is team work. The work is split up into small elements arranged so that, as the work is passed from one worker to another, the least time is taken on each element. Repetition work is the order of the day, and even the man whose work for over three years was to give two turns to No. 16 nut did not leave because the work was too monotonous.
The fact remains that, as a rule, workers do not object to monotony so long as they are well paid for the work, and there does not appear to be any increase of idiocy in the Ford shops owing to the dulness and once-and-for-ever nature of the work.
To produce work by handicraft means a life of unremitting toil for the craftsman, and even then the cost of the finished article is so great, if the worker is to get but a very moderate return, that only the wealthy could buy it. This postulates a wealthy class which is diametrically opposed to the principles of the idealist.
The craftsman would have neither leisure nor opportunity for the study and appreciation of finer things, and in the end it means poverty, and poverty means ignorance and misery.2
We must accept the fact that wealth is the product of machinery or of some worse form of slavery, and, for my part, I prefer it to be produced by machinery.
Besides all this, machinery is here, and to do without it is absolutely impossible—as impossible as it is for a highly developed organism to revert to its primitive state.
Where shall we draw the line and say, We will have no more machinery than we have at present? We cannot do so; it is manifestly impossible. Where, then, shall we draw the line and say, This work must be done by hand and not by machine; this work must be done on a general machine and not on an automatic; this work must be done by a single man and not by a team of men; this work must be done under this or that old-fashioned system and not under a well-organised system? These lines can never be drawn. Progress, by its very nature, will crush whatever opposes it, even though it has no intention of doing so. And it is not desirable to oppose progress if we desire to live and develop. As automatic machinery is the extreme end of one line of progress, so it is undesirable to sweep it away, even if it were possible.
Now, automatic machinery means cheap production,and this means more wealth. More wealth ought to mean more leisure for everybody. In order to make the best use of leisure, better education, real education, is needed—education in reasoning, in science, in civics, in art, in economics, in freedom.
The trade-unions are not educational; it is no part of their programme. The workers depend on their opponents for their education. Instead of curtailing wealth, the trade-unions should endeavour to control the production and distribution of it, to divert it so that it will benefit the workers, in order that both leisure and education may be theirs.
Under any conceivable system, the man who has the energy and initiative of the man who at present becomes a capitalist would always be a more important and better paid or better rewarded man than the worker. But he would be a leader and not a driver, and whatever he possessed would be looked upon by those who worked under him as a natural and righteous return for his ability. I merely mention this because trade-union control is no menace to the progress and success of the man of ability.
Finally, let me say that, if we must have cheap production, if we must have better organisation and make more and more use of machinery, if we must increase each man's output in order to meet the financial necessities of the immediate future, what method shall we adopt? Is it to be day work or piece work? Is it to be co-partnership or profitsharing that tend to rob a man of his liberty and turn him into a miniature capitalist? Or is it by such a method as this Reward System, whereby a man retains his full liberty, where his work is made more interesting, where he does no harm to his fellow-workers by earning high wages, where his trade-union is his stand-by?
These are the ways, the practical available ways, that confront the worker. It is easy to imagine pleasanter ways, but the devil drives and we have to decide now. The trade-unions would be wise to give close attention to the Reward System and that greater organisation of which it is a part. With trade-union support it will become one of the most satisfactory solutions of the differences between worker and employer; without trade-union support no system will be satisfactory.
It is not efficiency for efficiency's sake that is the issue. Efficiency is only a means to an end, to the end that the worker eventually may be in a position to exercise some control over the making and distribution of wealth. Present conditions drive him farther and farther from that end, and only education, better conditions of living, a certain amount of leisure, and a desire to undertake responsibility, will enable him to achieve it. Following on that will come the realisation of what efficiency would mean applied to the general production and distribution of commodities, to education, to the affairs of State, and with that comes the desire to control, and after that, again—well, perhaps Idealist will begin to see daylight!
These notes are not concerned with the essential rightness or otherwise of this or any other system of wage payment, or of the wages system itself, or of the Capitalist System. These are matters altogether outside the subject. These notes are only written because the writer considers the Reward System, when properly carried out, to be the best of several existing methods of payment for work done; and as this particular method will be adopted more and more, and as it undoubtedly leads to greater production and is to the direct and immediate advantage of the worker, those concerned with the welfare of the worker ought to consider the system in all its bearings, and not hurriedly condemn it because it is new, because it is American, and because it increases the productivity of the worker. If there is any practical scheme that can be immediately adopted and will appeal as strongly to both worker and employer, by all means let us have it and abolish existing methods of wage payment altogether.
Thefollowing is a description of one particular method of the time study and reward payment following out the principles described in Part I. This particular case is one which has been introduced into two engineering factories in England.
It must be understood that the methods described are not necessarily those which apply in all factories. Only the basic principles have been described in Part I., and only one particular method of application is described in Part II. Almost every shop will have its special details, its individuality, and different trades will differ widely in the carrying out of the principles. Manufacturing machinery, laying bricks, sewing shirts, shaving, etc., cannot all be brought under one exact scheme. But all must have time study and reward payment in proportion to efficiency as a foundation on which to build a superstructure of sound economical business management with satisfactory labour conditions.
There will be an occasional repetition of points dwelt upon in Part I., but this is in order that the detailed description will be complete in itself.
When an order is received for a certain quantity of any article, the first thing to do is to make a drawing of the article, and, following on that, all the operations to be done on it are studied in the drawing office.
The kind of metal is decided on; which operation must be done first and which next; which machine each operation must be done on; how many operations can be done on one machine and with one setting up of the article; which tools to use; how fast the machines must run; what speed and depth of cut is best; what cutting compound to use, etc.
Then a time study is made of the job as it goes through the various operations on each machine.
It depends on the nature of the work how this study is made. On automatic machines the output depends largely on the speeds of the machines and the moving of the turret, and these can be calculated from the countershaft speeds, the gears, and the cams. On other work, however, where each job has to be set up and taken down, and where tools have to be brought into position by hand, it is necessary to watch all the processes and movements carefully, so as to discover the best and quickest way of doing it.
On hand work it is the same, but there is morescope for motion study—that is, moving the job and working on it with the least number of movements.
A good average worker is chosen, and is paid time and a quarter during the study.
After the job has been done a few times in order that the worker may become familiar with it, to see that the tools and speeds are satisfactory, and to cut out useless motions, the time study is made, every detail being observed carefully.
The reason for separating the job into its details or elements is in order to see that each detail receives careful attention, for only in this way can the best method of doing the job be found. The essence of the system is that the best methods shall be found for all the details, and the record thus obtained puts all the workers on the same basis.
It must be particularly noted that the time study is not for the purpose of driving the worker. The study of the job is really a process study, and method after method is tried until the best way of doing the work has been determined. Then, and then only, the time is taken—not for purpose of driving to get a shorter time, but to record the actual time in which the work has been done under certain special conditions. The process study, together with the time recording, form what is called the "time study," which is a permanent record of all the circumstances under which the job has been done,includingthe time taken, so that when the job has to be repeated all the conditions are known accurately and immediately. This should be borne in mind both by the worker and the employer.
A time study sheet is filled in with the general information connected with the job, and also a dimensioned sketch of the article in the finished condition. (If necessary, a sketch or the dimensions of the article before machining are also given.)
Methods of tool setting are given, and also description and details of fixing any jigs, carriers, clamps, etc.
Each element of the operation, from picking it up and putting it on the machine bed to taking it off when finished, is put in a column in sequence on the left side of the sheet. Even an element which requires only a few seconds to perform is entered separately.
There are several columns for entering the times of the elements, one column for each complete operation.
The time study engineer stands where he may see every motion of the machine and every movement of the hand. The stop-watch is mounted on the same board as the time study sheet, so that they can be held in one hand while the times are jotted down with the other.
The watch is set to 0, and the figure is entered against the first element. When the operation begins, the watch is started, and at the end of the first element the time is noted and set down. The watch is not stopped, and therefore each element time consists of the watch reading of the last element subtracted from the reading of the element under consideration. For instance:
It will be seen that the watch is not stopped until the end of the complete operation, and therefore the last reading indicates how long the operation has taken; it is the sum of all the elements.
If anything happens which is not a part of the operation—for instance, if a tool needs replacing owing to accident or becoming dull too quickly, or if a belt breaks—the watch is stopped, and when the operation begins again it is started and goes on from the point where it stopped.
During the timing, observations are made to determine whether any part of the operation may be done in a quicker or easier way, or whether any element is taking longer than it ought to do.
It must be particularly noted that there is a distinct difference between time study and time recording. Any job, the slowest or fastest in the whole factory, may be time-recorded by merely observing the time with a stop-watch, but this is not a timestudy.
When several sets of figures have been obtained, the number of sets depending on the circumstances, the timing part of the study is over.
The figures are now examined. The time of each element is obtained as described in the example. In noticing the times of any one element, times which are much less or much greater than the others are eliminated, and the average of the remaining times is taken. Then all these averages are added together, and the average time of the complete operation is thus obtained.
This time is considered to be the fastest time in which the operation can be done. It is not actually the fastest for two reasons. One is that any time so obtained may be improved on when the worker becomes thoroughly used to the job, and the other is that a goodaverageworker is chosen for the time study; therefore a first-class man can improve on the time obtained.
But it is considered to be the fastest time, and we will call it the base time.
Now, this time has been obtained under exceptional circumstances. When a man is working on a time study job—that is, with the knowledge that he is on trial, so to speak, and with the time study engineer timing and observing every detail andmotion—he works faster than usual. There is no opportunity for little breaks, or rests, or breathing spaces; it is hard slogging all the time. The time study engineer does not intend it to be so, but by the nature of the circumstances that is what happens, and no man can keep this up for long.
It is quite evident, therefore, that this time cannot be reached regularly by every worker, and this is taken into consideration when determining the standard time—i.e., the time in which the job should be done by the average worker.
To obtain the standard time an allowance is made on the base time. This allowance depends on the nature of the work, a higher allowance being made for jobs that need a good deal of handling than for jobs that are nearly all cutting, because cutting is independent of the worker.
The way to arrive at the allowance is to examine the recorded figures, and add together all the cutting times and then all the handling times. An allowance of about 10 per cent. is usually given on the cutting times, and from 15 per cent. to 50 per cent., or even more, on handling times. The cutting times depend on the machinery, and that is why a smaller allowance is given for them.
This standard time is the basis of the Reward System, and is therefore the most important time. It is so fixed in relation to base time that every worker put on that work should be able to reach itafter a little practice. If he does so, he is said to have reached an efficiency of 100 per cent.
A worker who reaches continuously 100 per cent. is a high efficiency man.
This efficiency should always be reached by a worker who follows the instructions and works diligently.
Reward begins, however, considerably before this point is reached, because it may be necessary for a worker to be on a job some time before he reaches a high efficiency. Again, sometimes one worker is naturally slower than another; and although his work is good, he can reach 100 per cent. efficiency only by special effort. There would be little encouragement if reward did not begin until the worker had reached 100 per cent. efficiency.
For these reasons, and as an incentive to every man to become as highly efficient as possible, reward begins when the worker reaches 75 per cent. efficiency.
This means that an allowance of 33⅓ per cent. is given on the standard time or standard production, and this new figure is called "reward time" or "reward production" because it is the point where reward begins.
The following examples will make the matter clearer:
Let us assume that the time in which the job can be done is found by the time study to be 12 hours; this is the base time, and can be reached or even exceeded under favourable circumstances, because in the first place it has already been reachedduring the time study, and in the second place the worker on the time study was a goodaverageman, so that afirst-classman should be able to do the job in quicker time.
Now, suppose the job needs a good deal of handling. In such a case the time will be increased by, say, 25 per cent. in order to obtain the standard time; 25 per cent. of 12 hours is 3 hours, so that the standard time is 12 + 3 = 15 hours. Therefore, if the worker does the job in 15 hours, he has reached 100 per cent. efficiency, which is the point to be aimed at. It should always be attained by every worker who follows the instructions accurately and works diligently, while a good worker should always be able to do it in less time.
The point when reward begins is arrived at by adding 33⅓ per cent. to the standard time—that is, 15 hours with 33⅓ per cent. of 15 hours added; 33⅓ per cent. of 15 is 5, and 15 + 5 = 20 hours. Reward is earned, therefore, when the job is done in anything less than 20 hours.
It will be seen that, while it is quite possible to do the job in 12 hours or even less, yet if the job be done in anything under 20 hours reward is earned.
What amount of reward? Well, suppose the job rate is 36s. This means that the job is given to a worker whose day wage is about 36s. per week. This is 9d. an hour on a 48-hour week. Suppose the work is done in 16½ hours. As the standard time is 15 hours, the job has taken longer than standard time; it is 1½ hours longer than standard.But, as the reward time is 20 hours, it has been done in 3½ hours less than reward time; in other words, 3½ hours have been saved on the job. The worker gets paid for all the time he saves = 3½ hours at 9d. per hour; total reward 2s. 7½d. So that for his 16½ hours' work he gets his day wage of 9d. per hour (= 12s. 4½d.) + a reward of 2s. 7½d. —that is, 15s. in all. In other words, he earns 11d. per hour instead of 9d. per hour.
His efficiency is 91 per cent., but efficiency calculation will be mentioned later.
Let us now examine another case, a small part job. We will assume that the time study shows a production of 40 of these small parts per hour.
We have now shifted from times to quantities. The base quantity is 40 per hour, that number being the greatest number produced by a good average worker in 1 hour under favourable circumstances. The standard quantity will, of course, be less than this, and, as such work would probably be done on an automatic machine with practically no hand work, an allowance of 10 per cent. is made on the base quantity in order to obtain the standard quantity. Ten per cent. of 40 is 4; therefore the standard quantity is 40-4 = 36. This is the quantity the worker ought to produce continuously if he is diligent and attends to the machine properly.
As before, reward begins at an earlier point than standard. That is to say, if a smaller quantity than 36 be produced reward is earned, but a certainminimum quantity must be produced before reward begins. This minimum quantity is called "reward production," and begins at 75 per cent. of the standard production. (36 × 75)/100 = 27·0, and this is the reward production for one hour, reward being paid on any excess above this.