Business Administration: Theory, Practice and Application. [Vol. 1] Business Economics

by Unknown

The management, which immediately controls the records and conditions should be the prime source of efforts towards the increase of efficiency throughout the plant. The opposition of managers to progress in this respect is exceedingly great, yet not altogether surprising for these reasons:

1. There is a widespread fallacy that so-called practical experience in the manual operations or technical processes of a business is the chief essential to success in its management. This is due to the fact that perfection of workmanship, of which he knows much, is more important in the eyes of the artisan than the actual cost of the operation, of which he knows little, or than the cause of this cost, of which he knows less.

2. It is only recently that educational institutions have afforded any opportunity for adequate instruction in the art of management, pure and simple, a principal feature of which is the intelligent regulation of cost.

3. There has been, and now is, as a result of these two things, a failure to appreciate the necessity and value of exact data, in proper terms, of refined and scientific methods of collecting and using it and of logical reasoning in the solution of industrial problems.

The highest degree of efficiency, therefore, is only to be realized in a shop where executive methods have reached a high stage of efficiency, for in these is unquestionably its source.

Time Measurement Important.

The first step is to recognize the necessity and value of a proper measurement of time, as a guide not only to the executive but to the workman. A man was observed during 8 successive repetitions of the operation of making a machine mold in a foundry. The unit times varied 5.2 to 23.6 minutes, the total time for the eight being 104 minutes. Under the method of timekeeping in use at that shop it was only ascertained that the eight operations took 1¾ hours or an “average” of 13 minutes each, and the labor cost and distribution of burden were made on that basis. Because of the absence of any standard time whatsoever it was not realized that had the man done each of the eight in 5.2 minutes, they would have been completed in 41.6 minutes, resulting in a saving of over 60 per cent of the total time. Had the man received a proper work ticket bearing this standard time, before he began the work, there is no doubt that he could have easily performed the work in the shorter time and a marked difference in proportionate burden and cost would have resulted. Under the existing methods the management could not know of the waste, and so was helpless to prevent or cure it.

Every item of time, therefore, is capable of division into two parts: A standard or necessary time and a (more or less) preventable waste, which latter is the easier thing of the two to determine.

An Example of Increased Efficiency in Riveting.

A gang of four were engaged in riveting some steel plates. By the use of a stop-watch it was found that a large proportion of the total time of the riveter and bucker-up was not utilized; yet some one was always at work. The reason was that the men proceeded along the work in such a way that the bucker-up covered with his body the holes as yet unfilled by rivets, he moving from left to right. When, therefore, a rivet was driven, these two men had to stand aside until another rivet was placed by the rivet passer. Upon the instruction of the engineer, they reversed the direction of their movements so as to cover only the filled holes, thus enabling the passer always to have a rivet ready for them and making their speed in driving the real gauge of the speed of the operation. Furthermore, when they encountered a hole that needed reaming (as was sometimes the case, until the fault was located with the fitters and remedied), the riveter would lay down the gun, pick up the reamer, ream the hole, lay down the reamer, pick up the gun and drive the rivet. When persuaded to test consecutively ten or more holes after driving the first rivet in a seam to anchor the plates and then to drive the ten consecutively, they progressed faster with less effort. These men, receiving not only a standard from the engineer, but kindly instruction as to how to attain it, and being stimulated, not by abuse, but by a scientifically determined bonus—increased their output over 150 per cent beyond the original amount.