Part 34

EFFICIENCY IN SHOP OPERATIONS. 370

BY H. F. STIMPSON.

Managers of industrial enterprises will undoubtedly agree that there are few qualities which are more to be desired in equipment, methods and men than that of efficiency. From an extensive study of this subject in various parts of the country, together with interviews and correspondence with several hundred concerns, the writer has become convinced that there is a general lack of definite comprehension of what efficiency is, whence it springs, how it may be measured and developed and the results which its cultivation will produce. The object of this monograph is an endeavor to throw some light upon these things and to afford a new viewpoint from which to study industrial operations.

The Evolution of Industrial Management.

In the first place we must realize that the management of industrial enterprises is in a state of evolution. The tremendous growth of the past few years has caused certain previously satisfactory methods to become inadequate to present needs. Many details which in the days of smaller affairs could be absorbed by personal inspection and mentally stored for use when needed must now, because of their very volume, be made matters of record.

The character of these records has much to do with their value. Because financial records are so ancient they have exerted an undue influence upon the character of all other records. While under our present civilization, the ultimate object of industrial operations is to create financial profits, there are many highly important records which cannot be adequately expressed in terms of money. The business 371 of manufacturing consists of a repetition of mechanical operations. Mechanical operations necessarily involve considerations of weight, distance, time and effort, but not of money.

The reason for the failure of so many cost systems to serve the desired end is that they are based upon a wrong unit. These systems become useful only beyond a certain point. Other systems have been the result of a blind craving for aid, but being without broad underlying principles and not properly tied together and simply, in many cases, disjointed attempts to improve isolated details, they too have failed. The result is that attempts by specialists to improve industrial conditions have been often looked upon with suspicion and this is not altogether without reason. These very failures, however, have drawn the attention of men in certain lines of engineering to the rapidly developing needs of manufacturers. They have attempted to solve the problems by the use of engineering instead of by accounting methods, and the results which have been attained prove conclusively that a material advance has been made.

What Is Efficiency?

With this understanding of the present conditions, let us consider what efficiency really is. It has been defined as “the ability to produce certain results,” and this at the very outset necessitates the existence or creation of a standard of measurement. Our perception of efficiency, therefore, is correct only in proportion to the precision of the standard, which must be accurately developed from data which are not only exact, but complete. A machinist, believed to be operating at high efficiency, was observed while turning a shaft. His cut, feed and speed seemed to be beyond criticism. When the shaft was finished, however, he had to spend half as much time in hunting up a chain and pad to remove the shaft from the lathe, as he had taken in 372 turning it. This cut his actual efficiency from 100 per cent down to 87 per cent, yet the man was not at fault. His normal work was to operate a lathe and not to hunt for things which should have been provided for him. The points to be observed here are not only the importance of using the right standard of measurement, but that the efficiency of the man depended very largely upon his surrounding conditions over which he had no control. These conditions depend upon the efficiency of the management in securing proper equipment from the owners. This in turn depends upon the efficiency of the management’s records in enabling it to state clearly and accurately what increase in output and consequently in profits will result from improving the conditions--thus justifying the expenditure required. We see from this that the true standard is not the possibility under existing conditions, but that which can be obtained under other and more desirable conditions.

Managerial Opposition to Change.

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 373 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: 374 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.

In this plant, by the use of these methods, and in about seven months, the general increase in efficiency of the men was such that the force was reduced 67 per cent without reduction in volume of output, but 375 with a great reduction in net total unit cost, even after paying the bonus alluded to and the cost of the expert services which alone produced this result.

The Use of Bonuses.

It is proper to say a word here on the subject of bonus as a means of increasing efficiency. The principal merit of this motive lies in the fact that immediate personal gain is the strongest incentive to immediate personal effort. It operates just as strongly on the employe as on the employer. Hope of promotion is too vague and the actual chances too limited to exert much pressure, but an extra sum in the pay envelope--or better still, in a separate one--for the disposal of the “old man himself,” will do wonders. To be most effectual a bonus must not begin at the point of standard efficiency, but at the point when average efficiency ceases and extra effort begins; and it should increase on a curve faster and faster as the point of standard efficiency is neared, because the accompanying effort will be correspondingly greater.

Efficiency Methods and Department Heads.

So much for the individual operator. And now for the executives. From foreman up to and including the highest official the same methods can and should be applied. Under ordinary circumstances, the workman in need of material, tools or instruction keeps his skirts clear by a more or less indefinite and unintelligible request to the foreman. He thinks it the foreman’s duty to look after him, but that if he does not do so it’s no business of his. Put that man on standard time and bonus and if there is anything he thinks the foreman should do or get for him he speaks loudly and directly. This the foreman does not resent--as would ordinarily be the case--for his efficiency is determined by the combined efficiency of his men and upon this his 376 bonus depends. Anything, therefore, that interferes with the progress of the men touches him closely, and he will move heaven and earth to eliminate it. All kinds of defects which were previously hidden from the superintendent are now brought to his attention, and he welcomes them for exactly the same reason that actuated the foreman. Thus the change that comes over a shop when efficiency is accurately measured and adequately rewarded is often astounding.

But this is not all. The possession of exact data as to standard and actual times makes possible a certain great improvement in, and addition to, the executive staff and a material increase in the efficiency of the foreman and department heads. By this is meant the installation of a planning department, by which the apportionment of the time of men and machines is controlled. The advantage, indeed, the positive necessity, of the services of engineers and draughtsmen in apportioning the different parts of the product is well understood. The requirements of each part, the strains to which it will be subjected, the kind, quality and quantity of material required to resist these strains, the shapes of the pieces, their relations to each other and many other things are all given most careful attention. The value of fully constructing the design on paper, as a means of discovering possible errors or difficulties, and of correcting or overcoming them before large expense for material and workmanship has been incurred, are too well realized to need more than a simple statement for their acceptance. No sane executive would expect his department heads to take a copy of his customer’s order and individually work out the details with which they are particularly concerned and expect the parts to fit. Yet this is just exactly what is being done as regards the apportionment of productive time; and a tumult of broken promises of delivery, excessive cost of production, enormous wastes of time in changing jobs, etc., is the immediate 377 and unavoidable result.

What Can Be Done.

It is perfectly possible, but only to one trained in the particular art, to schedule the different operations on all of the different parts of the product; to plot the productive times required, so that each may begin at such a time in relation to the others that all will arrive at the point of assembly at the proper time and in the proper sequence; to combine these studies of the different productive orders on a chart which will show the disposition to be made of all the men and machinery; to prepare advance programs for each man and machine engaged in productive labor; and thus to give to the superintendent and foremen the advantage of the same predisposition of time that they now have of material.