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The Rise of Factories
The Development of Industrial Management
Studies of Worker Performance
Management of the Machine
Other Aspects of Management
The principles of scientific management have been gradually extended to every department of industry, including office work, financing, and marketing. Soon after 1910 American firms established the first personnel departments, and eventually some of the larger companies took the lead in creating environments conducive to worker efficiency. Safety devices, better sanitation, plant cafeterias, and facilities for rest and recreation were provided, thus adding to the welfare of employees and enhancing morale. Many such improvements were made at the insistence of employee groups, especially labor unions.
Over the years, workers and their unions also sought and often won higher wages and increased benefits, including group health and life insurance and liberal retirement pensions. During the 1980s and 1990s, however, cutbacks and downsizing in many American businesses substantially reduced many of these benefits. Some corporations permit employees to buy stock; others make provision for employee representation on the board of directors or on the shop grievance committee. Many corporations provide special opportunities for training and promotion for workers who desire advancement, and some have made efforts to solve such difficult problems as job security and a guaranteed annual wage.
Modern technological devices, particularly in the areas of computers, electronics, thermodynamics, and mechanics, have made automatic and semiautomatic machines a reality. The development of such automation is bringing about a second industrial revolution and is causing vast changes in commerce as well as the way work is organized. Such technological changes and the need to improve productivity and quality of products in traditional factory systems also changed industrial management practices. In the 1960s Swedish automobile companies discovered that they could improve productivity with a system of group assembly. In a contrast to older manufacturing techniques where a worker was responsible for assembling only one part of the car, group assembly gave a group of workers the responsibility for assembling an entire car.
The system was also applied in Japan, where managers developed a number of other innovative systems to lower costs and improve the quality of products. One Japanese innovation, known as quality circles, allowed workers to offer management suggestions on how to make production more efficient and to solve problems. Workers were also given the right to stop the assembly line if something went wrong, a sharp departure from U.S. factories. By carefully controlling the manufacturing process, Japanese managers were able to cut waste, improve productivity, and reduce inventory, thus significantly reducing costs and improving quality. By the early 1980s, Japanese companies, which had once been criticized for producing for producing low-quality goods, had established a reputation for efficiently producing high-quality, high-tech products. In the 1980s and early 90s many U.S. companies looked to increase their competitiveness by adapting Japanese methods for improving manufacturing quality.
See study of Taylor by R. Kanigel (1997). Also see G. Friedmann, Industrial Society: The Emergence of the Human Problems of Automation (1955); S. Haber, Efficiency and Uplift: Scientific Management in the Progressive Era, 1890–1920 (1964); J. Barbash, The Elements of Industrial Relations (1984); D. DelMar, Operations and Industrial Management (1985).