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Wall Street History
https://www.gofundme.com/s3h2w8
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08/22/2003
Scientific Management
[We''ll return 9/5]
Last week we took a look at Henry Ford and the Model T, this
time it’s an examination of the theories of Frederick W.
“Speedy” Taylor, a theorist who had an awful lot to do with
Ford’s success, along with that of many others.
Taylor, born in 1856, was the first “efficiency expert,” as
postulated in his 1911 book, “Principles of Scientific
Management,” which spelled out the new discipline of the same
name.
Taylor formulated his theories as a steel company foreman in the
1880s and 90s, working for the likes of Bethlehem Steel. He
analyzed every job in the mill and worked out a system of
division of labor, increased mechanization, and piecework wage
systems, in order to increase efficiency and production, and thus
profits. “Scientific management,” or Taylorism, also believed in
the elimination of allegedly extraneous work motions and the
acceleration of others.
Taylor quit his job in the steel mills in 1901 and set to work on
promoting his management system, aided by a number of
associates including Morris L. Cooke. But it was only after his
book was published (much of which was written by Cooke) that
his theories gained a wide audience.
From Taylor’s observations in the 1880s and 1890s, the practice
of having foremen pressure workers for greater output resulted in
unnecessary conflict.
“Throughout American industry,” he wrote, “management’s
concept of a proper day’s work was what the foreman could
drive workers to do and the workers’ conception was how little
they could do and (still) hold their jobs.” [Tindall and Shi]
The basic principle was to use the carrot rather than the stick, and
grant incentives to those who produced the most.
As historian David Kennedy notes, this proved to be the
“ideological justification for automation in industry .For
Taylor, workers as well as machines lacked intelligence and
performed most efficiently when controlled completely by
engineers and managers.” You can see how Henry Ford was
able to quickly adapt the theory in institutionalizing the auto
assembly line for the Model T.
Taylor did a lot of work on time-motion studies, using a
stopwatch, to improve factory arrangement, proper use of tools
and equipment, and the development of planning departments.
Efficiency experts became a part of the everyday scene in
business, though this was not always well received.
Taylorism was also used to “defang” union organizers. Non-
union corporations in the 1910s and 1920s often offered stock
bonuses and profit-sharing plans, life insurance, and old-age
pensions, what was known as “welfare capitalism.” But then the
corporation could modify or terminate the plans at will.
Kennedy writes in “Freedom From Fear”:
“When the Crash came, the transient generosity of employers
was starkly revealed as a shabby substitute for the genuine power
of collective bargaining that only an independent union could
wield – or for the entitled benefits that only the federal
government could confer.”
Scientific management led to design departments at the likes of
General Electric and Sears Roebuck, in the first broad-based
promotion of “consumer engineering,” but as Kennedy noted
above, by the 1930s Taylorism became shorthand for an
oppressive industrial system. Micromanagement wasn’t viewed
in the positive light by social scientists as it once was. In the
long run, scientific management proved to be a “highly malleable
and ambiguous term defined by diverse, conflicting
constituencies.” [Paul S. Boyer]
As an aside, Frederick Taylor was one of the first lecturers at the
new Harvard Graduate School of Business Administration,
founded in 1908 and the first to offer a Masters in Business
Administration. The initial core courses covered topics such as
“Corporate Finance” and “Industrial Organization.”
Sources:
“The Growth of the American Republic,” Morison, Commager,
Leuchtenburg
“America: A Narrative History,” George Brown Tindall and
David Shi
“New York Times Century of Business,” Floyd Norris and
Christine Bockelmann
“Freedom From Fear,” David M. Kennedy
“A People’s History of the United States,” Howard Zinn
“The Oxford Companion to United States History,” edited by
Paul S. Boyer
Wall Street History returns September 5.
Brian Trumbore
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