2. Scientific Management
2.1 Frederick W. Taylor and his Principles of Scientific Management
2.2 Scientific Management in practice
2.3 Criticism on Scientific Management
America at the turn-of-the century was a rising nation. It was the time of the Gilded Age and the Progressive Era. It was in those years when Frederick Jackson Turner stated his “Frontier Thesis” and in which names like Rockefeller, the industrialist, Upton Sinclair, the writer or the W.E.B. Du Bois, the black leader, became well-known.
A few decades after the end of Civil War the country was still in search of an identity, what it wanted and what it stood for. The unrelenting conflict on the meaning of the term America was visible in various fields such as immigration, consumerism and the development of America’s economic system. The struggle for the shaping of America’s economic system can be more narrowly defined as the fight between the two production factors capital and labor, which Alan Trachtenberg calls “the two colossal forces of the period” (Trachtenberg 1982: 174).
As the two predominant actors in America around 1900, capital and labor both underwent essential changes. On the side of labor, the foundation of the first American labor union and the development of a working class with a specific working-class culture have to be mentioned. The factor of capital was also deeply shaped in that era. The influences were the free labor doctrine, the creation of corporate bodies and the rise of Scientific Management. Scientific Management set new standards in leading a business and put the term management out of the former context which meant authority, manager’s personal judgment and inefficient methods. In its aims and also in its practical realization the new method of management tried to put business decisions on a rational, intelligent and so scientific basis. Moreover, Scientific Management touches both counterparts, capital and labor, and so indirectly involved in forming a new America.
The intention of this paper is to clarify what Scientific Management was, how it affected managers and workers, in others terms capital and labor. The following pages are going to show criticism of Scientific Management and qualify that. Furthermore, an assessment of Scientific Management and its results are given. The primary question of this paper is what impact did Scientific Management as one invention of America at the turn-of-the-century have on the country at that time, and whether there are remainders of Scientific Management either in America or in other parts of the world that are persistent today.
2. Scientific Management
2.1 Frederick W. Taylor and his Principles of Scientific Management
Already before Frederick W. Taylor’s widely published book on Scientific Management, different techniques of leading a business existed in the American economy. Management often meant slipshod methods, decision-making by mangers’ personal judgement and hard work for the employee. The most common and youngest among them was the “Systematic Management”, which tended to eliminate economic wastes and whose elements are still partly preserved in Taylor’s work. Though the “Principles of Scientific Management”, the author claimed, contains a complete new philosophy, it is based on revolutionary thinking. Acknowledging the fact that there were further writers discussing Scientific Management in their work, this paper concentrates on Taylor’s system of management as his name has become almost synonymous with the term Scientific Management. This also serves as a basis to be compared to a contrary point of view in the following chapter. Moreover, this paper intends to focus on the leading question whether Taylor’s theory of Scientific Management had a practical impact on America during the time considered and whether Taylor’s work is still persistent today.
Frederick W. Taylor was born in Philadelphia in 1856. His professional career began at Midvale Steel Company where he rose from a simple worker to an engineer (1878-90). Since 1893 he delivered presentations to the American Society of Mechanical Engineers (ASME) of which he was elected president in 1906. During his professional career, Taylor developed a reputation as a brilliant technician and a progressive manager. After Taylor’s resignation at Bethlehem Steel Company in 1901, he devoted all of his energy to promote his system of Scientific Management by consulting American companies and spreading his principles in several books.
Taylor’s “Principles of Scientific Management” was published in 1911, only shortly after President Theodore Roosevelt raised “the question of national efficiency” (qtd. in Taylor 1911) in an address to Governors at the White House. Taylor’s principles pick up this line and emphasize the “large wastes of human effort” (Taylor 1911) in the American factory system. The purposes of his book are, according to Taylor, the illustration of inefficiency in America, proving systematic management as a remedy to inefficiency, and convincing that science is the best way to manage an enterprise.
The principles are based on the belief that the main object of management in general is to maximize prosperity for employer and employee. Because definitions of the term prosperity can be discovered in a wide variety Taylor states his own one. According to his principles, prosperity for the employer is expressed in high dividends and the business’ “development to its highest state of excellence so that prosperity can be permanent” (Taylor 1911). The employee’s prosperity is defined as high wages and, furthermore, his “development to his highest state of efficiency” (Taylor 1911) and so the capacity to perform his individual highest grade of work. The principles are based on the conviction that both’, employee’s and employer’s, interest for maximum prosperity go hand in hand.
Taylor illustrates the aforementioned principles with the simple example of a shoe manufacturer. If the employee doubled his daily output from one to two shoes his employer could sell twice as much as before. Due to his larger profit the employer would be able to pay his employee a bonus and at the same time having increased his dividend. There is no denying that this is a simplification, as it is not guaranteed that the manufacturer would be able to sell all his shoes, and there is no attention brought to the question what would happen if all manufacturers doubled their output, so that it would not be binding to pay one’s own employees extra money. Nevertheless, the illustration is useful to understand Taylor’s philosophy of employee’s and employer’s motive to cooperate.
Furthermore, the training and the development of each single workman is fundamental to Taylor’s system of management. As it has been shown that bringing the individual worker to his highest state of efficiency is a primary aim of management, it is the manager’s task to do so. This is the point where Taylor’s theory becomes “scientific”. Taylor argues that all mechanical arts are based on details, knowledge and varying methods. The amount and complexity of these methods are too much for a single worker, even a foreman. The task of management is precisely to collect all those methods of production, to analyse them and to choose the one most economic and fastest way. The selection and analysis performed by the management is scientific work. According to Taylor, the manager has to provide his employees with detailed instruction cards and working tasks, based on management’s created science, to ensure that the employee develops to his highest state of efficiency.
Taylor describes in his book several practical applications of his principles. Regarding this paper’s argumentation, functional foremanship, time study, and differential piece rate are going to be described exemplarily. Functional foremanship was one of Taylor’s most revolutionary suggestions as it meant the elimination of the traditional foreman. The traditional foreman in a plant was an all-powerful executive, who performed the tasks of a trainer, a rate setter, and a personnel manager all in one. Taylor divides the position of a traditional foreman into several “bosses” each of them fulfilling a specific one of the old functions; a “speed boss” preparing the worker’s tasks, an “inspector” controlling the product’s quality and a “disciplinarian” who was responsible for personnel questions. Functional foremanship reduced the single foreman’s power, made it possible that average workers could serve as new foremen, and so it gave greater power back to the management.
Elementary time study meant an analysis of a specific job in order to find the most efficient method to perform it. Jobs were split into sub-tasks, sometimes even movements, each of them observed and the fastest movements collected and given in form of instruction cards to the worker. Those instruction cards told the worker exactly what to do, how to fulfil it and in what time. Time study was later enhanced by one of Taylor’s disciples to “Time and Motion Study” and “Micro-motion Study” which followed the same idea.
Differential piece rates and time study were intensely bound together. Piece rate included a wage system based on individual incentives, bonuses and payments depending on the workers individual output, which meant the amount of goods he produced. This wage system used time studies to set a standard of products or tasks each worker had to fulfil per day. Being faster and more productive than expected, the individual worker got a higher wage proportional to his additional output. It is important to mention that Taylor’s system worked in both directions, which meant that if a worker did not manage to perform the standard task he was also paid less than the average.
For that reason and keeping in mind the criticism which is discussed later, it is useful to take a glimpse of how Taylor himself emphasizes the possible benefits of “his” scientific management. Taylor promises his system to “double productivity”. The increasing individual productivity would make the whole country more prosperous. Furthermore, the adoption of scientific management in an industrial establishment would “mean […] the elimination of almost all causes for dispute and disagreement between them [employer and employee].” The conclusion of Taylor’s perception of scientific management is that the general adoption of its principles would create larger prosperity and that “the larger profit would come to the whole world in general” (Taylor 1911).