f ^^ imp .' I^' t ii liu' ' ' i;i 'J- fi'itfi ',? I » tiiVwv^ hill. 'r'*,H ti- J I < wT5t i:;" WATCHMEN ■ T~ t — |assistant| EQUIPMENT DEPT. MANAGER INTER-DEPT TRAFFIC CRANES NOT UPKEEP TRUCKS NOT UPKEEP RIGGERS RUNNERS R1S6IN6 MATERIAL HETALLUIBICAi ENGINEER *-|A55lgrANTl- MATERIAL SELECTION MATERIAL SPECIFICATION MATERIAL INSPECTION ANALYTICAL LABORATORY K ANALYSIS FORfelNO METHOD OF SHEET METAL WORKING METHOD OF HEAT TREAT FOUNDRY MIXING AND MELTING PRODUCTION OEPT MANAGER : ^ Iassistant MISCEL MFG PRODUCTION CONTROL STORES KEEPER STORES J?EC0RD5 PRE-HA0IM5 STORES ASSEMBLY STORES ERECTING STORE SERVICE STORE PRODXT STORE yVHOLESALE MILL SUPPLY CASTING STORES COAL-COKE »J5AN[H'l6IS0lf STONE-nC STEEL BAfrBllLET ETC. OIL STORE , PLANT OPER- ^ Tat ION DEPT.i MANA&ER ^ STANDARDS DEFT. MANAGER '^iSSCTmpU'- STANDAROIZE - MACHINE k PARTS OETERMINE NEED ♦ OF FIXTURE-JIGS AMD EQUIPMENT STANDARDIZE CONDITION OF MFG. STANDARDIZE OPERATIONS STANDARD TIMES TIME KEEPING MATERIALS AND PRODUCT [ASSISTANTS I BORING TURNING MILLS ALL INCOMING MATERIAL UNLOADING PLACING AUTO TRUCKS HOT UPKEEP LARGE LATHES SWITCHER HOT UPKEEP HORIIOKTAI BORING HORIIDHTAL DRILLING Ia3&EMBLyU*-* ERtaiNS TOOL MAKIN8 GEAR CUTTING BR0ACHIN6 SHEET METAL HEAT TREAT «|A55I5TANT^ , GENERAL FOREMAN t CUPOLA LATHES ■>tTHREADA«B SCROLL LARGE MOULDING TURRET AND AUTOMATIC SHALL M0ULWN6 FLASK REPAIR NISHT SHIPT PlVN of the BULL.VRD ORGANIZATION SHOWING THE InTER-RELATION OF DEPARTMENTS , CLEANINS CAST1N65 FILLING >| PAINTING CASTINCiS LABORERS AND CUPOLA LQAI PATTERN 5T0RA6E IN FOUNDRY A PRACTICAL ORGANIZATION PLAN 3 PLANT EXECUTIVE COUNCIL Chairman — Works Manager. Members — Department Managers as follows: Works Engineer Engineering Standards Equipment Production Poj-ge Plant Operation Foundry Organization Service Employment Comptroller Function— Determination by conference on general plan of operations and requirements to attain the aims established by Management; and, by means of a general understanding of the individual and related activities of each and every department, to arrive at a complete coordination of effort in the upbuilding of the organization and the production of the greatest possible output of the highest quality work at lowest possible cost. Chairman will serve and act as Director and Coordina- tor of the effort of Departmental Managers. The meetings of the Plant Executive Council are held weekly, upon a specified date, and the subjects for consideration are announced by the Chairman (Works Manager) in his published call. It is largely possible that certain members of the Council will have no direct interest in subjects to be discussed at a meeting, and it is not expected that they will attend unless some particular phase or operation in their own department requires report or consideration by the Council as a whole; in which event, prior to the set meeting date, said member is required to sub- mit a brief outline of his case to the Chairman (Works Manager), thus msuring its consideration at next meeting. Typewritten copies of conclusions reached at Council Meetings are furnished each member of the Council for his guidance and information. PRODUCTION DEPARTMENT Function— "What to do." "When to do it." Related Factors and Lines of Effort: To estabhsh and maintain schedules of manufacture 4 PLANNING PRODUCTION FOR PROFIT Requisition materials Received and record materials Store and issue Raw Materials Commercial Parts Manufactured Parts and Units Shipping Finished Product Interdepartmental Transportation STANDARDS DEPARTMENT Function — "How to do it." Related Factors and Lines of EfiFort: Analyze machine design and construction with a view of STANDARDIZATION and possible simplification of parts OBJECT — a lower cost of manufacture (Findings to be reported to Engineering Department for further consideration and final action) Develop and record for shop use Standard Methods of Operations and instructions thereon (Supply in proper form to Plant Operation Depart- ment) . Establish "Standard Routing" and "Standard Times" (Supply to Production Department, for their guidance in establishment of manufacturing schedules) EQUIPMENT DEPARTMENT Function— "What to do it with." Related Factors and Lines of Effort : Selection of required equipment Layout of Plant Development and design of jigs, fixtures, etc. (Schedule and control while in process) Selection and requisition of small tools Tool Crib Control. Maintain and repair machine equipment A PRACTICAL ORGANIZATION PLAN WORKS ENGINEER Function— "Where to do it." Related Factors and Lines of EflFort: Supervise and maintain Buildings, Power, Equipment, and Grounds Install all equipment PLANT OPERATION DEPARTMENT Function— "DOIT." Related Factors and Lines of Effort: In Buildings, provided and maintained by Works En- gineer's Dept. By Power, provided and maintained by Works Engineer's Dept. On Equipment, furnished by Equipment Dept. According to Plan, Standard Method and Route, and in Standard Time, established by Standards Dept. With Men, provided by Employment Dept. As required and SCHEDULED, by Production Dept. Maintain Discipline FOUNDRY DEPARTMENT Function — Casting Production as and when required by Pro- duction Department. (Foundry Production Department allied with and under control of General Production De- partment. Foundry discipline under control of Foundry Dept.) All other related activities under control of its proper Main Department. METALLURGICAL DEPARTMENT Function — Selection, Specifications for, and Control through in- spection, of all materials entering into machine construc- tion. Related Factors and Lines of Elffort: Forge Department Heat Treating Department 6 PLANNING PRODUCTION FOR PROFIT Sheet Metal Department Analytical Laboratory Advisory EMPLOYMENT DEPAETMENT Function — ^Provide and Maintain Working Force. Related factors and Lines of Effort: Employ Labor as required for operating departments Establish and maintain educational work Supervise industrial relations Supervise recreational activities ORGANIZATION SERVICE DEPARTMENT Function — Service. Related Factors and Lines of Effort: Safety Engineering Sanitation Supervision of Man Power Health Supervision of Sickness and Accident — First Aid (Busi- ness and financial records regarding insurance and protective benefits handled and controlled by Treas- urer's Dept.) Lunch Room Control Cooperative Stores Control Investigation An analysis of the situation confronting the country in 1915 led us to the conclusion that an organization could be built up and maintained only on the foundation of such principles as would permit satisfactory relations between employer and em- ployee, and which would insure stability of labor and true efficiency of production. The principles evolved are: 1st. That respect and confidence between employer and employee shall be established and maintained. 2d. That a proper and equitable incentive must be provided for both. 3d. That there must be established a measure for de- termining a rate of wage. A PRACTICAL ORGANIZATION PLAN 7 4th. That the rate of wage must be definitely related to the energy, skill, experience, and knowledge required to perform the work. We, like many successful manufacturers of long standing, had, without doubt, for many years operated on the basis of the four principles enunciated above, but until the stressful period which shortly followed the outbreak of war in Europe, we, in common with the rest, had not felt the need of clear statement of the policies which we had long followed. Publication of these policies, together with a clear statement of the various plans and lines of activity through which the policies were made effective, had a very marked influence in clarifying the situation and in upbuilding an organization spirit which was remarkable for its effect upon production and the quality of work. While these fundamentals were fully understood and appre- ciated by the older members of our organization, the influx of new men, incident to the rapid growth of our plant, called for special effort on the part of the executives and their representa- tives to whom authority had been delegated; and to attain the end of complete understanding and harmony, particular atten- tion was given to the development of a proper spirit and under- standing in that frequently neglected element of plant organiza- tion, the department foreman. That we have been notably successful in our efforts is evi- denced by the unusual spirit shown by everj^one in this estab- lishment. This has frequently been the subject of remark by visitors, and numerous instances could be related of the display of this organization spirit when circumstances were most trying. The managers, their representatives and the employees have established relationships whereby mutual respect and confi- dence prevail. The rate of wage is dependent upon individual productive capacity, the cost of living, and the question of supply and de- mand — individual productive capacity bearing a paramount relation to the other factors as it directly affects the cost of manufacture and therefore the saleability of the product in question. 8 PLANNING PRODUCTION FOR PROFIT Statistics bearing on the cost of living are nationally available. Data regarding supply and demand is a matter of plant record, as is information regarding the cost of the various classifications of labor applied to production, and in turn, the direct relation of labor cost to the sales price of the finished product. To arrive at an intelligent conclusion by combining the factors evolved by the above analysis requires experience, judgment, and, above all, an equitable mind. It is highly essential, how- ever, that the hourly rate established shall be such as will pro- duce in the worker a contented state of inind. The incentives to employees are in the form of a bonus pay- ment based on the proportion of actual time to standard time on all jobs where such times can be considered. This is, of course, in addition to standard rates per hour for various grades of work. Individual judgment is not infallible, and, as in the nature of things, earning capacity bears a direct relation to produc- tive capacity, means are provided for recording the individ- ual's capacity for production and comparing, by periods, the improvement or decrease therein. The BuUard Maxi-Pay Wage Plan is based on a classifica- tion of the various degrees of energy, skill, experience, and knowledge, and in combination with the records of the Maxi- Pay Bonus Plan provides a means for determining the status of each member of the Organization. Every department is complete in itself, held strictly respon- sible for all matters over which jurisdiction has been assigned to it. Thus the production manager has full authority over everything indicated on the chart within the limits of his func- tions and is held strictly responsible for definite results. With the aid of a most complete routing system, he follows with cer- tainty every piece or lot of material from the moment of its receipt, through the stores to the various machines and opera- tions to which it may be assigned, up to the moment of deHvery of a finished machine tool. The number of pieces of finished parts for any job is always shown on the charts or forms in this A PRACTICAL ORGANIZATION PLAN 9 office so that the chief or one of his assistants can give informa- tion bearing upon this with the least possible delay to any other executive of the plant who desires it. This organization plan avoids conflicts of authority, makes it unmistakably clear to every executive what he must do and how he must carry out his part of production in relation to the other executives. It is a real cooperative organization, and the proof of this statement is embodied in the facts that it produces, that it is financially successful, and that it holds its employees. It has required only a short time to build up a force of skilled mechanics loyal to the company and cooperating so far as is necessary or advisable with the management with the aim in view of increasing production, reducing costs, and increasing the worker's pay. Labor troubles have been comparatively few. The men in the shops have an opportunity to express them- selves individually either adversely or otherwise on the policies of the company, because the executives have always shown their willingness to listen to any reasonable complaints or suggestions on the part of the employees. There seems to be no particular need of shop committees. There are such bodies in the works, but they do not function as "Grievance Committees," as it is a point of the management to eliminate the possibility of the development of anything to the point where it can be classed as a "grievance." In any comment, therefore, on the Bullard organization, it must be realized what an important part of the plan is embodied in that which does not appear on the organization chart, but which manifests itself in the recognition by the management that the men working for them are always worthy of the fullest consideration, and by the willingness of the men to do an honest day's work for those who treat them right. THE MODERATE-SIZED FACTORY BY D WIGHT T. FARNHAM THE factory employing from a hundred to three hundred men is frequently owned by a single individual, or, if the company is incorporated, the management is dominated by the heaviest stockholder to such an extent that the result is the same. This man may not be actively engaged in the busi- ness of manufacture — quite frequently is not — but nevertheless his influence is strongly felt in matters touching the general business policy, expenditures, and innovations of any sort. The manager of the business, who may or may not have had manufacturing experience, is often the sales manager, in fact, if not in name, and presides over the general office of the company. He is looked to for results, but must keep well within the limits of the company's policy as laid down according to the doctrines of the dominant stockholder, and heresy of any kind on his part is likely to result in personal disaster. One of the most firmly established tenets in the creed of the successful business man is that of insisting upon the utter ex- termination of unproductive labor. No one will dispute the soundness of the reasoning provided the labor so designated assists in no way the process of manufacture. Too often, how- ever, since the man whose brain only is active differs not greatly in appearance from the man who is loafing, the fact that an em- ployee is neither rushing about nor actively engaged in manual labor causes him to be condemned as useless, and he is hence- forth abolished. The heavy stockholder very often knows a good deal about bookkeeping, and, since he visits the factory to better it, he will readily attack any apparent excess of men in this department, while fear of showing his ignorance would cause him to hesitate a long time before criticizing the number of men actually engaged in the work of manufacture. The manager and the superintendent must please their superior and 10 THE MODERATE-SIZED FACTORY 11 so are extremely loth to sanction in any way an increase in "apparently unproductive labor." When lack of profits forces retrenchment the clerical force is always the first to be attacked, and the efficiency of the executive is often badly impaired by the consequent lack of necessary figures. Even some very successful business men go so far as to view with great alarm the acquisition of anything in the nature of office furniture by a superintendent, fearing that he may be tempted to loll in idleness when he ought to be rushing about among his men. They feel that they are getting their money's worth when he is wearing out shoe leather which he pays for, but they are not so sure of it when he is sitting at a desk working his brains and using paper and pencil which they pay for. This may seem to be an exaggeration, but nevertheless the two commonest criticisms applied to managers and superintend- ents are: "The business is too top-heavy," or, "He has too many men standing around." Human nature being what it is, and the successful owner having pretty definite ideas as to who is responsible for his suc- cess and as to just how it was obtained, what chance has the efficiency engineer of foisting upon the average small business the paraphernalia of Staff and Line, Routing, Dispatching, and Time Study, with their Chief of Staff, Supervisors of Study, of Planning, of Standards, of Bonus, of Analysis, etc., together with each one's clerks, messengers, etc. ? The result of such an attempt would be too awful to contemplate. How, then, is the small or medium-sized enterprise to obtain the benefits which can unquestionably be obtained by the introduction of the principles of efficiency.'' A number of years ago the writer was placed in charge of a factory in the Far West which employed a hundred men. The plant was in a chaotic condition, having just passed through an interregnum under a foreman after a year under a superintend- ent whose troubles had driven him to drink. The old timers in charge of various departments were at war with each other; each had designs upon the superintendency, and all looked upon a college graduate as some sort of an animal designed rather to amuse than to alarm. As a result, the writer spent 12 PLANNING PRODUCTION FOR PROFIT the first few weeks in rushing about from one department to another trying to get each one patched up to run long enough so that the factory could be operated as a whole. When this had been accomplished the factory was limping to such an ex- tent that it was realized that each department and each ma- terial would have to be analyzed and great improvements made before anything like efficient operation could be looked for. Meantime, the factory had to be run, and it took all of one man's time straightening out the snarls arising in each department and keeping the product coming. This forced the writer to recognize the principle that the factory should he so organized that it would run itself, leaving the superintendent free to throw him- self to the aid of the weakest department. This idea was worked out in practice by gradually evolving from the most promising material at hand a line organization under an assistant superintendent. This organization handled all the routine operations of manufacture leaving the superin- tendent free to meet any emergency of an extraordinary nature and to do analytical and research work — made him, in a measure, chief -of -staff . It seemed logical that the highest-salaried official about the plant should be best able to study and improve the various operations, and the opportunity to do this was secured. When necessary, assistants were detailed from the different de- partments, and the scope of certain foremen who were expert in certain operations was extended to cover other departments as far as these operations were concerned. The course of the product through the factory was studied and changes made which facilitated its movement. The assistant superintendent made the dispatching one of his duties, and a sufficient supply of raw and semi-manufactured material was assured each depart- ment. Processes were studied and unnecessary labor elimi- nated. All finished products not strictly first quality were classified according to their defects and the causes removed as far as possible. The written instruction card was adopted for the most important operations after a thorough analysis and determination of the best method by a process of elimination. Outside expert assistance was called in when necessary; other plants were visited, and the experience of the best workmen THE MODERATE-SIZED FACTORY- 13 made available. Machines were improved and in some cases new varieties were substituted. This type of staff organiza- tion, as will be seen, permits the careful investigation of various problems, but at the same time, on account of its great flexibil- ity, its expense is no greater than the occasion demands. As the system began to operate more smoothly, the results were evident. Fuels were investigated, and a more efficient type of furnace reduced power costs. By the use of indicator diagrams, power was increased and steam consumption de- creased. Gages recorded the conscientious performance of the duties of the night crew. Shutdowns on the more important machines were diminished when recording gages were installed which showed their duration and frequency. Technical control on all furnace operations saved fuel and improved quality. Conveying and unloading plants were installed which cheap- ened the cost of handling raw materials and fuel. Methods were adopted which lessened the damage to parts in transit from one department to another. Staff methods of investiga- tion applied to every department decreased costs and improved quality. For the first few months it was impossible to determine the exact balance of the plant as the maximum output for each department was not known. As soon as this could be ascer- tained, however, weak departments were strengthened by the addition of equipment, men, or special attention, until a con- tinuous pull was exerted upon the product throughout the course of its movement through the factory. The way some depart- ments expanded when cramping conditions were removed was astonishing. As a result, responsibility for delays was placed where it belonged, and the output of the plant was increased nearly 50 per cent. The cost system was overhauled, useless work eliminated, and the balance so arranged as to emphasize variations from the normal in such a way that they would receive immediate atten- tion. The cost of vital or governing operations was figured daily, so that the executive knew each morning what efficiency had been attained the day previous. The shipping department was reorganized along lines which would make mistakes difficult. 14 PLANNING PRODUCTION FOR PROFIT and the $150,000 stock of manufactured goods which it was necessary to carry was recorded on a continuous card inven- tory in such a way that the office knew the supply of each variety at all times and, therefore, could safely promise delivery or manufacture new stock to remedy deficiencies. The time of all workmen was distributed against the proper operation, so that prompt and reliable records were secured. All clerical work was so systematized that, with the exception of the for- mal bookkeeping, it could be done by one man in spite of the fact that sales usually amounted to over $400,000 per year. Labor conditions were improved as time went on. About three quarters of the men were paid by the day and the balance were under the task system. Good results were obtained with the latter as the time allowed for the tasks was never cut, al- though one or two adjustments had to be made in the rate per hour to suit conditions in the district. The efficiency of the day workers, of course, depended largely upon the driving abil- ity and personality of the foremen, but everything was done to remove obstacles to rapid performance and to make working conditions comfortable. Definite records were kept of the daily production of each man or crew, so that any urging to further efforts was as intelligent as is possible under the day- labor system. Wherever possible it was made easier to do the right thing than the wrong, and it was generally so contrived that the per- sistent wrong-doer was sooner or later "hoist with his own petard." The adoption of this principle, while it requires abso- lute fairness, a knowledge of human nature, and some intuition, elevates the general tone of an organization to a marked degree, as an apparent Fate is a much more terrible opponent than the usual flesh-and-blood boss. Every effort was made to get the workmen to tell the truth when a fault resulted in loss, on the theory that if all the causes for a defect were known the defect could often be remedied or the reason for the mistake or shortcoming of the workman in- telligently removed, while if some factor were concealed wrong conclusions would be reached. In fact, in one or two depart- ments the workmen knew that a lie meant instant discharge, THE MODERATE-SIZED FACTORY 15 while the most flagrant offense, if honestly explained, meant, at the most, a lay-off. This resulted in a mutual trust and frank- ness between the executive and the workmen, which were of in- calculable value. The adoption of this system of Staff-and-Line organization cut the labor cost in less than two years from 20 to 30 per cent., and increased the output 50 per cent, and the quality 20 per cent. After a few years the system was installed by the same com- pany in its other factories. In one, the introduction of the system allowed the superintendent sufiicient time to exercise a latent inventive genius which revolutionized a considerable branch of manufacture. The output of one machine which had never in the history of the business exceeded 5,000 units per day was increased to 13,000 with little increase in the operating crew. All sorts of articles were manufactured which had been impossible before and great improvements in quality were made. The company became possessed of a number of valuable patents; workmen were rewarded for their inventive genius, and in- genuity was stimulated. Record outputs for various machines and quality records were circulated among the different factories, and successful emula- tion was rewarded. Output increased, quality improved, and costs decreased. The best brains were released from routine and the results were of incalculable value to the company. In all, this system was installed in six different factories, and the invariable result was lower costs, increased output, and improved quality. Later it was successfully adapted to the operation of mines and quarries, always with beneficial results. When the principles of Scientific Management and Efficiency were definitely stated in book form by Taylor and Emerson, their importance was immediately apparent to the writer who, in so far as he was able, applied them to the operations of the various plants. Belting was standardized, and repairs analyzed. In one plant alone the cost of repair parts in one department was cut over $1,200 a year — 33 per cent. The cost of oil in one factory was reduced nearly $1,500 a year, or 50 per cent. Wher- ever applied, the principles effected a great saving — but that is 16 PLANNING PRODUCTION FOR PROFIT another story. The point is that it was proved that the Super- intendent, Staff, Assistant Superintendent and Hne organization were adapted to carrying out the principles of scientific manage- ment in the factory of moderate size. These principles are overwhelming in their logic. It is the machinery of the thing that terrifies the owner of the small fac- tory. The Industrial Engineer does not get very far with his "Staff paralleling the Line," "Keeping costs on the operations of each man," "Planning and Dispatching Departments, etc.," before his explanations are drowned by cries of: "Red tape," "Too much overhead," "Too much system," "Our business wouldn't stand it," and the factory is denied the privileges which it is admitted the large plant can afford. On the other hand, the plan of freeing the superintendent from routine — making him work his brains and, therefore, not wasting any of his high salary in semi-physical labor which a cheaper man can do as well — seems logical and contains nothing revolutionary. The plan is one which appeals also to the su- perintendent. He still has his authority over his men in case he wishes to exercise it. His prestige is in no way diminished. To maintain discipline and to avoid inroads upon his time he must give orders only through the assistant superintendent; but the good executive will regard this as no curtailment of authority. If the business is so small that the superintendent, by calling on one or two of the regular departments for assistance from time to time, can keep the principles of scientific management in operation, the benefit is secured. After the Industrial Engi- neer has made the analytical time-studies and shown him how to continue them on the more simple operations, he can keep this part of the system up and revise the written instruction cards from time to time with occasional help from the engineer. The bonus system once established, the superintendent can make such slight adjustments as are necessary. Dispatching, per- haps, takes part of a clerk's time, some of his regular foreman's time, and demands occasional attention from the assis- tant superintendent. Routing, once established by the engi- neer, needs' little attention. The same foremen become rather THE MODERATE-SIZED FACTORY 17 more specialists, and, with little increase in expense, functional foremanship is established. The repair man who is required to keep certain records in conjunction with the man who has charge of the storehouse is told to do a little more thinking, and to let his helper do more of the manual labor; before long, with the engineer's help, standardized repairs are an accomplished fact. All this is very crude and is adapted to only the smallest sort of a factory. The system is flexible, however, so that the plan outlined above may be expanded. An assistant foreman may be created here and there; specialists made of the various repair men, and the activities of staff officials removed a little more from the line until the conventional Staff -and-Line organi- zation recommended for the large factory is reached. PRACTICAL ORGANIZATION PRINCIPLES BY G. SUMNER SMALL THE term "Organizing" is so often used in industry to denote the selecting of competent men to act as execu- tives, or employment and the term "Organization" to denote the collection of men thus obtained or the personnel, that it is necessary to define the interpretation used in this dis- cussion. " Organization " is here used to denote the art of splitting up the main purpose or function of an industry into many lesser pur- poses or functions which will be within the capacity of individual attainment. It is parallel to the use of the word "design" in mechanics representing the science of dividing the conception of a machine to perform a main purpose into definite parts each of which performs a lesser function in the furtherance of this main purpose. The two sciences are similar in a number of ways and many of the basic principles of design may be followed to advantage in organization. Design is absolutely limited by the quality and strength of available materials and the known means of working them into the shapes of the parts desired. Organization is limited by the ability and brains of available men and by the difficulty of training these men to capability in performing the desired tasks. The designer would not think of designing the parts of a machine so they would require greater strength than any but rare materials or so shaped that they could not be formed except by specially designed machinery, as the cost of construction would be prohibitive. The organizer, on the other hand, almost invariably ignores this fundamental material factor. He divides the main purpose 18 PRACTICAL ORGANIZATION PRINCIPLES 19 of the industry into various functions and positions without any regard as to whether the duties and mental requirements of the positions are within the abihty of the ordinary executive who can be retained to fill the position. He does give attention to the physical side of the work. The number of men employed as laborers is carefully propor- tioned to the amount of physical effort required. Executives are also roughly limited in the number of men or departments assigned to them, but no attention is paid to the complexity or variety of mental efiPort assigned to those positions whose labors are primarily mental. This is one of the reasons why so many industries experience great difficulty in obtaining executives who are capable of suc- cessfully handling the duties of their various positions. The fault is usually assigned to the executives selected. The fault actually lies with the management which has created positions which the ordinary executive has not the ability to fill. Few managers realize the enormous difference in the skill, knowledge, and mental effort required, which can be brought about by a proper split up of duties. As an illustration let us examine the difference which can be created in the mental effort and knowledge required by skilled workers in an assembly department assembling a complicated machine such as an automobile. In the old-fashioned assembly department each man or crew assembled all parts of complete machines. They had to know the construction and position of each part and the method of fitting and adjusting it to give the most satisfactory operation in the completed machine. The men were high-priced, skilled workers and it took several years to train a man to proficiency in this work. In the modern assembly department each man or crew assem- bles but one or two parts to the machine which is then passed on to other assemblers who put on additional parts. Each man requires only a knowledge of the particular parts which he handles. Ordinary moderate-priced workers are used and can be trained to proficiency in a few weeks' time, and the machines produced are more uniform and better adjusted than those 20 PLANNING PRODUCTION FOR PROFIT assembled under the old methods and the production per man is far greater. The advantages of the second method are gained entirely by the method of splitting up the work. In the first method the split-up divided the physical effort into tasks within the powers of individuals, but the mental effort was not divided and re- mained at a maximum for each employee. In the second method, the division split up both the physical and mental effort and brought the mental requirements of each position within the scope of men of less ability and shorter training. As in machine design a factor of safety can be used to advan- tage in organization. That is, instead of making the mental effort of the position equivalent to the ability of the average executive it is made enough lower to eliminate any doubt of his capability in handling its duties. The less the effort required, the lower the ability necessary to handle the position and the better the results obtained with the same grade of executive. This specialization can be carried to an extreme, especially as applied to minor positions or employees, just as the factor of safety in machine design may be so large as to produce a clumsy machine. If the mental effort is extremely small the employee tends to degenerate through the non-use of his general faculties and the over-use of the particular faculties brought into play by his over- specialized work. This is well illustrated by over-specialization in physical effort. Where an employee is restricted to but a few motions, the mus- cles not used deteriorate, while the muscles used are overtaxed to an extent which frequently results in occupational sclerosis, or a temporary paralysis of the overtaxed muscles. Such work is also monotonous and irritating and the employee gains no experience of value to him in any other position or company. The labor unions recognize this evil and are inclined to oppose over-specialization of work. However, this is no more an argu- ment against legitimate specialization than the clumsy machine with the excessive factor of safety is an argument in favor of PRACTICAL ORGANIZATION PRINCIPLES 21 abolishing any consideration of the factor of safety in machine design. Mental specialization is the specialization of the employees' activities on duties which involve mental requirements so lim- ited that extreme expertness is easily acquired. Such special- ization is brought about by organizing so as to split up the men- tal complications of the main functions of the business in their division into positions or jobs for the various employees. Mental complications in a business arise from two sources, namely, the products and the operations on those products. If the operations are complicated and difficult and the products simple, spfeciahzation is obtamed by allowing each employee one operation on a number of products. If the products are complicated and the operations simple specialization is obtained by allowing each employee to perform several operations on only one product. That this differentiation is not generally understood is shown by the great number of companies which have speciahzed posi- tions by operations under the impression that this necessarily specialized the knowledge required. This common error was well illustrated by the office arrange- ment of a firm manufacturing eyeglasses, spectacles, lenses, and optical goods, which, because of the endless varieties of types, sizes, and qualities, produced over one hundred thousand differ- ent products. The greatest mental effort mvolved was the knowledge of the enormous varieties of products produced. The operations in- volved were translating orders into factory specifications, check- ing against finished-stock records, pricing, factory-order writmg, and billing. Proceeding on their own theory they had speciahzed by opera- tions creating an order-translating department, a pricing de- partment, a stock-record department, an order-writing depart- ment, and a billing department. Each of these departments still required a complete knowledge of all products and this was beyond the capacity of any clerks who could be hired. The results were far from satisfactory. In the pricmg de- partment alone, despite the fact that the work was done twice 22 PLANNING PRODUCTION FOR PROFIT as a check, mistakes were made on approximately 15 per cent, of the orders priced. A change in organization was made and the office was divided into an eyeglass department, spectacle department, lens de- partment, etc. Each of these departments handled all opera- tions such as order translation, pricing, stock checking, etc., but they only required a knowledge of the particular class of goods handled. The former difficulties immediately disappeared. Where clerks formerly referred to records to obtain each entry, they were now able to depend largely on memory and the work was done faster and with less clerks. Before leaving this particular case it is worth while enumerat- ing the indirect advantages which resulted from correct organiz- ation. They were as follows: (a) — Where formerly a complete record of all products was required in each department, now one record split by products among the departments is sufficient. (b) — One reference to the product card serves to obtain the information for all occupations where formerly as many references had to be made as there were departments. (c) — Each order formerly had to pass from department to department and was delayed between departments where now it is completed in one department. This reduced the time required to get an order to the plant from three days to less than one day, (d) — The location of each order is fixed and known and all information concerning it can be obtained from one place. While there seems to be no definite law covering these inciden- tal improvements, it is nevertheless a fact that where a correct organization arrangement is made, the systems and methods required are simplified and reduced to a minimum. The same errors of organization are found in manufacturing departments where the tendency again seems to be to divide by operations rather than products without regard to the loca- tion of the greatest complications. PRACTICAL ORGANIZATION PRINCIPLES 23 An example of this was a machine shop manufacturing about twenty types of products of entirely different design. The shop had been divided by operations into a lathe department, planing department, milling department, drilling department, etc., because this hmited the knowledge of the foremen to the operation of the particular class of equipment used in his de- partment. Under this arrangement, each foreman handled one or more operations on nearly every part of all the machines manufac- tured which required a knowledge on his part of every detail of construction. It was necessary for him to keep track of and follow up every part and to cooperate closely with every other department handling them so as to produce them when required. He also had to handle and follow up every order received in the plant. The unsatisfactory results from this method of organization were briefly as follows: (a)— Complicated planning and follow-up systems were re- quired to keep track of the scattered parts of orders, (b)— It was impossible to maintain a flow of work from de- partment to department which would keep all machines busy without carrying excessive stock in process. (c)— It was difficult to determine the standing of an order, as parts of the order would be scattered through all de- partments. (d)— There was trouble in collecting all the parts necessary for assembly and many rush orders had to be put through to obtain needed parts. (e) — Parts were delayed in passing from department to de- partment and deliveries were late. (^f) — There were many errors and spoiled parts and it was difficult to determine which department was responsi- ble. (g) — It was difficult to determine the accomplishments of each department or to hold foremen responsible for results. This shop was reorganized so as to create a number of de- partments each of which performed all operations on and 24 PLANNING PRODUCTION FOR PROFIT manufactured complete one or two products only. The results of this arrangement may be summarized as follows: (a) — Each foreman had to be familiar only with the con- struction and parts of the particular products he han- dled and there were less errors and spoiled parts. (b) — Each department handled only that small portion of the orders for their particular products, and the only planning and follow-up work required was restricted to that department which handled all parts. (c) — There was no cooperation required between depart- ments as there was no exchange of product between them. (d) — There was no delay of parts between departments and orders were completed more rapidly; there were seldom any missing parts when the machines were assembled and orders were delivered on time. (e) — The accomplishment of each department was easily measured by the quantity, quality, and cost of the complete machines it produced and the foreman was held to strict account for the results produced. In this case the mental complications involved in a knowledge of the various kinds of operations performed were insignificant in comparison with the mental complication involved in a knowl- edge of the products produced, and consequently the correct organization was a division of the products among the various departments. The division of an organization by products does not neces- sarily mean one by complete products, it merely means that the products of any department shall differ from those of all other departments. For instance, in a plant manufacturing a single complicated product, a division by products would assign to each department the task of manufacturing one or several parts of that machine. A diametrically opposite condition would be met in attempt- ing to organize a pulp and paper industry. Here the products are all similar and little complication is involved in the knowledge of these products. However, the PRACTICAL ORGANIZATION PRINCIPLES 25 equipment and processes are complex and the greatest mental complication is involved in becoming competently expert in the handling of the various processes. For this reason a division by products would be inadvisable and it is far better practice to divide by equipment and pro- cesses, creating a wood room, a digestor department, a bleach- ing department, a washing department, a beater department, and a paper-machine department. The various foremen are then able to specialize and become extremely expert in handling their processes so as to obtain the results so necessary to the quality of the paper. In other plants both methods of organization often have to be applied to diflFerent sections of the business. For instance, the foundry would handle all parts requiring castings, while the machine shop might be divided so each would handle a specific portion of the products produced. In actual practice all sorts of counterbalancing complications are met which make the question of the proper split-up a nice study. However, by keeping the correct principle in mind and carefully analyzing the involvements of the main functions of the business it is not difficult to determine the divisions which will produce the most satisfactory results. In going concerns, the manufacturing split-up is often fixed by the existing arrangement of equipment, and the cost of changing this arrangement in accordance with correct organi- zation principles is prohibitive. This renders the task of man- agement difficult. However, a compromise arrangement can usually be effected after a careful study of conditions, which will approximate the conditions of correct organization. For instance, where the foreman has to be famihar with a wide variety of products, careful records of these products ar- ranged for quick reference will reduce the mental effort required. Where the arrangement requires excessive transportation be- tween departments a good planning system and an unusually efficient transportation system will eliminate the delays which would otherwise occur and assure a flow of parts which will keep all equipment busy. Where the arrangement requires close cooperation between 26 PLANNING PRODUCTION FOR PROFIT departments, that cooperation can be obtained through the in- stallation of records which carry all necessary information for cooperation between departments and make the furnishing of such information a routine matter which consequently will not be forgotten or neglected. As can be seen, a great part of the systems and methods which are installed in plants by firms of engineers are necessary only to overcome defects caused by incorrect organization, and poor organization can be blamed for much of the red tape and ex- cessive systematization which is so common in large industries. It is much easier to perceive the fault caused by poor organiza- tion and to attempt to overcome it through system than it is to perceive and correct the underlying fault in organization, and unfortunately most industries have taken this more appar- ent course of action. Systems which combine the greatest sim- plicity with the most direct action in obtaining the required results are one of the strongest factors in creating an eflScient industry and can only be obtained where a correct organization structure exists. The foregoing discussion has dealt only with the art of splitting up the main purposes or functions of an industry and presup- poses that those main purposes or functions have been definitely determined. However, in the majority of industries they have not been definitely determined. In a manufacturing industry this main purpose is the produc- tion of certain specific types, sizes, qualities, and varieties of products. Where these are fixed and the sales department functions only as a seller of these products, the main purpose of the company can be considered definite. Where, on the other hand, the sales department disposes of what it can best sell and the plant is expected to manufacture what is sold, the purpose is indefinite and fluctuating. The second method is by far the easier course and for that reason companies tend to drift into it and allow their customers to dictate the sizes, types, and varieties of products which they manufacture. The passing of the control of the policy of a company into the hands of the sales department and the customers is such a grad- PRACTICAL ORGANIZATION PRINCIPLES 27 ual process and seems such a natural outcome of legitimate growth that the dangerous tendency is seldom recognized by the management until conditions have reached a point where they seriously affect profits. A company starts manufacturing a few products, but soon finds a demand for additional sizes which it includes in its line. The salesmen soon find opportunities for making sales if special changes in design are made to suit the conditions or whims of certain customers. An opportunity to obtain a good order of different products arises and is accepted as increased business is desirable. It is but a step from these conditions to one where the salesmen offer a willingness to alter design or make specials as an ordinary inducement to obtain business. The company which started to make large quantities of a few products soon reaches the stage where it is manufacturing very small lots of an enormous variety of products and is con- ducting a job-shop business at intensive-production prices. It is a perfectly legitimate and profitable business to conduct a job shop making all special products; however, the continual changing of machine set-ups and the idle-time losses make this class of manufacturing so expensive that it is necessary to charge consistently high prices in order to make a profit. A very little of this special small-order business so reduces the efficiency of a shop that it renders it impossible for it to produce large-quantity production orders in competition with other manufacturers. Also the manufacturing methods, sys- tems, organization, cost methods, and management of a job shop are entirely different from those required to effectively con- duct a plant on a production basis. Another policy which seriously affects the economy of manu- facturing is that of service to customers. The acceptance of rush orders in a production shop so interferes with the flow of work through the plant that it is soon reduced to job-shop con- ditions and the advantage of the low manufacturing costs of production work is entirely sacrificed. The main purposes of an industry are necessarily the supply- ing of definite products and services to consumers. The in- ternal policies and organization structure are secondary inas- 28 PLANNING PRODUCTION FOR PROFIT much as they must conform to the carrying out of these main purposes if the plant is to be efficient. If these main purposes are constantly varying, the result is reflected in great difficulty in fixing the internal policies and organization as it is impossible to create a structure capable of efficient use in serving multiple or varying purposes. All production plants are called on to furnish repair parts and in most cases to put through special and rush orders for important customers. In order that this work shall not inter- fere with or interrupt production orders, the more progressive plants have found it advisable to create special departments run on a job-shop basis where all such work is handled without inter- ference with regular production. The natural tendency of a sales department is to make any concessions asked by a customer, and it will only conform to the purposes of the industry when restrained by strict policies. These policies may be considered as the laws set up to govern an industry so that it will conform to definite purposes. Like all laws, their interpretation may have to be varied to conform to the exigencies of particular applications and they may have to be revised to meet changed conditions, but they act neverthe- less as a compass and serve the important purpose of maintain- ing an industry on its course toward its ultimate objective. The main factors to be considered in the organization of an industry may be summarized as follows : 1 — Establish definite policies as to what types of products shall be manufactured. 2 — Establish definite policies as to the service to be accorded customers. 3 — Divide the task of accomplishing these main objectives so as to split up the major mental complications among the posi- tions created and so as to bring the duties of these positions well within the abilities of the average employees who can be re- tained to fill them. ORGANIZING A PURCHASING DEPARTMENT BY G. SUMNER SMALL 'HILE the saying holds good that the first profit in a business is in the purchasing, the attempt to pur- chase cheaply by beating the market is frequently car- ried to a point where it approaches speculation or gambling in futurities. Some concerns even go so far as to encourage their purchasing agents to speculate by holding them account- able where a price fell after purchase was made, or because an additional quantity was not purchased before a price rose. While there are several commodities, of which a good exam- ple is coal, which varies in price with the season, and in the purchase of which the purchasing agent is able to take advan- tage of low prices by stocking up, as a general rule speculation in purchasing materials is equivalent to speculation in wheat or in stocks, and has about the same opportunities for success. The purchasing agent who purchases at a time and in quantities in accordance with the requirements of consumption, and at the lowest quotation at the time of purchase, usually comes out ahead and best serves his concern. In a recent case a concern lost many thousands of dollars in speculation and seriously embarrassed its manufacturing de- partment through a shortage of material by holding off on necessary purchases because of the behef that war-time prices would not hold. The executives refused needed pig iron at $22 per ton and finally covered at $46 per ton; this was but one of many materials in which they gambled on the wrong side of the market. The functions of a purchasing department in the order in which the author has found them to be of the greatest impor- tance in producing profits for manufacturers, are as follows: (a) Obtaining the dehvery of materials at the time they are required. 29 30 PLANNING PRODUCTION FOR PROFIT (b) Obtaining materials of the exact quality for the results required. (e) Purchasing at the lowest possible price. One of the best illustrations in the author's experience of the conditions which may arise in a concern due to poor follow-up methods in the purchasing department was a small concern manufacturing heat-treating furnaces. The furnaces were con- structed almost entirely from purchased castings and parts. The manufacturing consisted largely of assembly work. An investigation in the assembly department showed an amazing condition. Figuring roughly by weight, there was enough material on hand to construct over one hundred fur- naces, but in no case were all the parts on hand that were necessary for the complete manufacture of any one furnace. The assembly department was filled with semi-completed fur- naces on which work had been stopped because of lack of parts. The assembly crews had to be continually switched from one job to another as the needed parts came in, were frequently idle, and the consequent assembly cost was so great that there was grave doubt as to whether the concern would be able to remain in business. The installation in the purchasing department of a simple, business-like follow-up system corrected the difficulties and put the concern on an excellent, profit-making basis. The manufacture of automobiles, especially those manufac- tured largely by assembling purchased parts, is another good example. The economical manufacture of automobiles is largely dependent on the maintaining of a uniform flow of parts through the plant, of a daily production of a uniform number of cars, and this is largely dependent on purchasing. A car cannot be completed in the assembly department unless every last nec- essary part is on hand. It is impossible to have the parts flow to the assembly department in the order and quantities in which they are required unless there is a comprehensive system of purchasing which obtains the deliveries of the parts needed, or the material from which the parts are to be made, at the time necessary. The manufacturer of an excellent though much-derided small car was forced at one time to ship his cars to dealers ORGANIZING A PURCHASING DEPARTMENT 31 minus hoods because the hoods were not on hand when required. The plant had a notably excellent planning system, but in this case failed to give proper conside ation to the ability of the vendor to live up to his contract. The purchasing agent must guard against the tendency on the part of vendors to accept attractive orders for a specified delivery date, when there is no possibility of them being able to meet their promises. If a purchasing department is to be organized so as to deliver material to the plant at the time at which it is required^ the following points must be provided for: (a) The purchasing department must be supplied with in- formation concerning the material wanted, and the exact date on which delivery is wanted, a sufficient time in advance of the delivery date required to enable them to obtain delivery on that date under the existing market conditions. (b) The purchasing department must keep the manufac- turing department posted in regard to the length of time in advance of requirements that material must be ordered to ob- tain the delivery wanted. (c) Where there is any doubt of the ability of the vendor to deliver the quantity required at the time required, an in- vestigation of the vendor should be made. (d) The requests for quotations and the purchase orders should be followed up systematically and persistently until the required goods have been received. It is evidently unfair for a concern to expect its purchasing agent to obtain the delivery of material in two months' time where the existing delivery time is four months, nor can he be expected to buy at the lowest prices on short-time delivery. Where a purchasing agent is forced to insist continually on exceptionally short deliveries, he becomes a pest to vendors. They may have to upset their manufacturing schedules to meet his demands, and if the vendors are crowded with orders he will be the first customer dropped as his business is undesirable. The purchasing agent should, as a routine matter, deliver to the manufacturing planning department at regular intervals a list showing the existing delivery time required for each of the various classes of material purchased. The manufacturing 32 PLANNING PRODUCTION FOR PROFIT planning department is then able to arrange to plan its material requirements sufficiently in advance to allow ample purchasing time. If, after this information has been given, the purchasing agent is not given the length of time to purchase as stated on his list, and the goods are not received in time, the blame lies on the manufacturing planning department. All requisitions on the purchasing department should have on them the date on which the delivery of material must be made. If the time allowed to purchase is not sufficient, the purchasing agent should notify the author of the requisition stating when delivery can be expected. Where large contracts are made with vendors, an investiga- tion of the ability of the vendor to meet the deliveries specified should be made. Inquiries among the vendor's customers may show that due to carelessness or inadequate planning methods the vendor is chronically late in his deliveries. In some cases the vendor is willing to be penalized in case he fails to deliver on the dates specified. The law does not allow penalties in contracts but does allow reimbursing for losses sustained. A clause may be inserted in the contract stating that in case of failure to deliver on the date specified the vendor shall pay a certain sum each day until delivery is made, as and for liquid- ated damages. In times of good business vendors are seldom willing to sub- mit to penalties and other means must be taken to assure the desired deliveries. The author has seen a manufacturing con- cern accept a large contract which a later investigation showed the concern was not mechanically equipped to produce and could not be mechanically equipped to produce in the time given. The only means of protection against such vendors is to make an actual investigation of the plant capacity and organization of the concern in question. The purchasing agent is hardly fitted to make such an investigation and must arrange to have it made either by a competent man from his own concern or by an outside firm of production specialists. The follow-up system might be called the mainspring of the purchasing department, for satisfactory purchasing service ORGANIZING A PURCHASING DEPARTMENT 33 from the manufacturing standpoint is almost wholly dependent on it. A follow-up system may be generally described as a means by which matters to be taken up at certain definite times are automatically brought to the attention of the person concerned at the time specified. The usual machinery for such a system is merely a drawer file indexed by dates. If a matter is to be brought up on a certain date it is filed under that date in this file. Each day the matter contained in the file for the date is taken out and given to those interested. In this way, on the date set the matter is automatically brought to the attention of those concerned. The first point to be followed up in purchasing is the obtain- ing of quotations. When a quotation is written for, a copy of the letter should be filed in the follow-up file by the date by which a reply can be expected. The length of time allowed naturally depends on the distance the letters have to travel, with an allowance for a legitimate time for the concern written to collect the information required and answer the letter. If no reply is received by the follow-up date another letter should be written. In many cases form follow-up letters can be used to advantage. All purchase orders should specify the dates on which ship- ment or delivery is required ; however, this is often not suflScient in itself to assure delivery on the date stated and concerns take further means to impress the importance of the delivery date on the vendor. An effective means is the inclusion of a clause on the order that the contract is not binding until the order has been acknowledged and the specified delivery date agreed to as part of the contract. Another harsher method is to state that, "We reserve the right to reject all goods not delivered on or before the date specified." These statements are generally printed in red so as to attract the attention of the vendor. Some concerns have obtained good results by inclosing an extra order copy to be returned as an acknowledgment, or by having an acknowledgment slip attached to the purchase order by perforations. Either of these acknowledgment forms should 34 PLANNING PRODUCTION FOR PROFIT contain an agreement to the delivery date specified that must be signed. The purchasing agent will often obtain valuable information in regard to the best method of dealing with vendors from the sales manager of his concern. The methods by which favored customers obtain the best service from his concern will be the best methods for him to adopt in dealing with vendors. The service you obtain depends largely on the moral status you es- tablish. If they learn that when you set a delivery date you mean business you will have little trouble in obtaining service. The foregoing point is well illustrated by the customers of a certain foundry. One wrote rather truculent letters to which no attention was paid while a mild request from the other brought immediate action. It was explained to me that the truculent one was always in a rush but forgot all about the letter after writing it, and that they would not hear from him again if they delayed the order a month. However, when the mild one wrote it meant that he really needed the goods and they liked to oblige him. The success of the mild customer in obtaining what he wanted was due to his adequate methods of planning and following up his purchases. He allowed them a reasonable time for manufac- turing and delivering his orders, but if his goods were not de- livered on time they invariably heard from him. In the unusual cases in which he requested quick delivery they knew he actually needed the goods quickly and did their best to help him out. The easiest method of following up orders is to have an extra copy of the order written which can be used for filing in the foUow-up file. This copy should have spaces provided on it for making notations of all follow-up letters. The first matter to be followed up in regard to a purchase order is the receipt of the acknowledgment. If the acknowl- edgment is not received within a reasonable time a letter re- questing an acknowledgment should be written. After receiv- ing a few letters of this sort a vendor will take particular pains to acknowledge your orders promptly. The next follow-up point is the receipt of the invoice. If you ORGANIZING A PURCHASING DEPARTMENT 35 have allowed yourself a margin of safety on your delivery date, that is, if you will not require the goods for say ten days after the delivery date set, and you are dealing with a reliable vendor, you can place your follow-up copy of the order at the date on which you should receive the invoice if the goods have been shipped when promised. If you will need the goods on the delivery date or are dealing with an unknown or unreliable vendor, the follow-up copy should be filed ahead of the delivery date, and on the follow-up date a letter should be written reminding the vendor of your order and the fact that you will need the goods promptly on the delivery date set. The purchasing agent will find it advisable to retain in his department two copies of the purchase order and also the purchase requisition. One copy of the order should be filed in the follow-up file, the other copy should be filed by purchase order number, and the requisition copy should be filed by the department ordering the goods and sub-filed by class of goods ordered. The purchase of goods for stock should be handled somewhat differently than the purchasing of other goods. By the usual method the stock clerk determines that addi- tional stock goods are needed and orders the goods purchased by sending a requisition to the purchasing agent. The author has found that it is more eflScient and requires less clerical labor if the stock records are maintained in the purchasing depart- ment. In this system the stock clerk is taken over by the purchasing department. When stores issues material on a requisition, instead of entering the material given out on the stock cards, it sends the requisitions to the purchasing department where the material is entered on the stock cards by the stock clerk. When the stock clerk finds that more material must be ordered, instead of writing a requisition he merely gives the stock card in question to the purchasing agent, who writes his purchase order from it. This saves the labor of writing requisitions. The constant following up of the purchasing department by stores for needed stock goods is also eliminated as the responsi- 36 PLANNING PRODUCTION FOR PROFIT bility for maintaining that stock is shifted to the purchasing department. The entering of the stock requisitions on the stock cards keeps the purchasing department in constant touch with the quantity of stock on hand, and if there is an unusual run on any stock goods they are aware of it and are able to hurry in their pur- chases of the goods in question. For convenience in purchasing, space is provided on the stock cards for entering the full purchase specifications of the material they represent. There is also space at the top of the stock card for entering the names of the vendors from whom the goods may be purchased and their quotations. This saves the purchasing department the work of keeping a separate file con- taining these data, and gives them a ready record by products showing vendors, prices, specifications, last purchase price, date of purchase, quantity ordered, date ordered, date received, and also the quantity of the goods that is being used. As the purchasing department is responsible under the system outlined for maintaining an adequate amount of all stock goods on hand, it becomes its function to determine the minimum amounts of stock goods to be carried, and the amounts that shall be ordered at one time. The definition of the minimum amount of stock to be carried is the lowest amount to which the stock is to be allowed to fall before more goods are ordered. The minimum amount should be a quantity of goods sufficient to last until more goods can be purchased and delivered. This quantity is evidently dependent on the quantity of the goods which are being used in a given time and on the length of time which it takes to purchase more goods. To set the minimum amount for any item of stock goods the purchasing department determines first the length of time which will be required to purchase the goods and have them de- livered. When this has been determined the stock card is re- ferred to and the quantity of goods withdrawn from stock for an equal length of time is determined from the entries on the card. This amount, plus an additional amount for a margin of safety in case delivery is slow, is set as the minimum amount. The minimum amount when set is not final and must be ORGANIZING A PURCHASING DEPARTMENT 37 changed whenever conditions change. Whenever entries are made on the stock card, the increase or decrease in the use of the material should be noted and, if considerable, the minimum amount to carry should be increased or decreased in proportion. When the time required to purchase certain classes of goods changes, the stock cards for that class of goods should be re- moved from their files and their minimum amounts should be changed to meet the new conditions. The amount of any stock item that should be purchased at one time is ordinarily set at a quantity equal to the minimum amount. When this is done the stock on hand and the invest- ment tied up in that stock are reduced to the lowest possible figure. There are, however, times when this procedure is not advisable such as where a decrease in price or a carload shipment can be obtained by a reasonable increase in the amount of the order. The method of determining when it is necessary to place an order for stock goods is as follows : When the stock clerk enters on the stock card the withdrawal of material and finds that the withdrawal reduces the amount remaining on hand to or below the minimum amount, he withdraws the stock card and passes it to the purchasing agent or his assistant who writes a purchase order for the amount to be ordered. The concern ordered from, the amount ordered, the price and the date are entered on the card, and it is returned to the stock clerk. When it is returned to its file a clip signal is attached to it and remains on it until the goods ordered have been received. By this means all stock cards on which there are outstanding purchase orders are dis- tinguished by a flag and can be more readily located. One of the greatest savings that can be made in purchasing is by purchasing to the exact specifications which are the best suited to the intended use to which the material is to be put. The fault of buying material of a far better quality than is neces- sary for the intended use is frequently met with. On the other hand, as great a loss is often sustained by buying materials of too low a quality. This results often in material waste, or in excessive labor cost in working up the material and fre- quently means dissatisfied customers. . 38 PLANNING PRODUCTION FOR PROFIT In a silk-ribbon mill, what appeared to be an evident saving was made by buying an inferior quality of silk. Investigation showed that the delay to looms and loss of production from the additional breaking of threads with the inferior quality of silk as compared with the better quality amounted to many times the extra cost of the better grade of silk. In addition, this meant a better product and more satisfied customers. There were, however, more expensive grades of silk yet which investi- gation showed it did not pay to use as the additional strength and reduction in thread breakage would not pay the additional cost. In another case the author made a saving for a brewery by purchasing their coal to specification as to the heat units per pound and the allowable percentage of sulphur. Under the contract as drawn up a bonus was paid for coal better than specifications and rebate was given when the coal fell below specifications. The contract was made with the same company that had previously supplied an extremely poor quality of coal, and was closed at the same price that had been paid for the coal formerly supplied. For every use there is an exact quality of material which best serves the purpose. To find this quality, careful considera- tion must be given to cost as compared with reduction in waste, saving in manufacturing labor, and improvement in durability or appearance of the finished product. The more modern large plants are usually equipped with laboratories where the exact suitability of the various grades of material for the intended use are determined and purchase specifications drawn up. These laboratories also sample and test all incoming material and determine if it is the quality or- dered. The testing of purchased goods for quality is as im- portant as weighing or counting them, for you pay for quality as well as quantity. While the purchasing agent is usually not in a position to start and manage laboratories for the testing of goods, he can at least show the management the importance of such a step and the probable savings to be effected. A start in the right direction can be made by listing a number ORGANIZING A PURCHASING DEPARTMENT 39 of the purchased articles and questioning their quality. As examples, pencils can be purchased from a cent a piece up. Is the quality you use one that gives satisfaction and is it the cheap- est that will give satisfaction.? Is the quality of paper used in letters and forms consistent with the use to which they are put.? An analysis of purchased goods will often prove surprising in showing up useless waste, and will lead to savings. Concerns frequently buy a variety of goods far greater than is necessary to meet all their requirements. This arises some- times from lack of standardization in the designing of their products and sometimes from allowing each department to order supplies in accordance with particular whims. The re- sults are a very much larger stock than is necessary, the ordering of goods in small quantities at higher prices, and often the turn- ing out of finished products for which it is diflScult for the cus- tomers to obtain repair parts. This inefficiency can also be readily shown up by analysis. Compare the types of certain articles used by the various de- partments. Is there any reason why they should not all use the same type.? Analyze any special articles or special sizes or qualities of articles that are purchased. Is there not a standard article that would answer the purpose just as well.? Analyze the variety of types, sizes, or qualities of a purchased article. Is there a sound reason why so many kinds are used, or is it just carelessness? An analysis of this sort will repay you many times the effort expended in savings effected. As has been before stated, the holding off of purchase or the purchase in advance because of the belief that prices are going up or down, is dangerous and closely akin to speculation. There are some keen judges of business conditions who may profit in this way but the average man would do well to leave the speculative side of purchasing strictly alone. However, there are legitimate opportunities for cheap purchasing at quo- tations below the market prices, and the purchasing agent should keep closely in touch with market conditions through the trade papers pertaining to the goods purchased. The price at which a purchasing agent is able to buy goods is dependent on the correct prices at the time of buying and the 40 PLANNING PRODUCTION FOR PROFIT size of the market from which purchase is made. The more vendors a purchasing agent deals with the more Hable he is to be able to purchase at the cheapest price. Except where prices are standard there is one concern selling the article you want which is quoting the lowest price. If that concern is not on your list you will not purchase at the lowest price. Whenever an advertisement is seen of a concern selling any of the articles you buy, but not on your list, it should be added to your list and quotations written for. If they sell goods that you carry in stock, their name should be entered on the stock cards of the articles in question. If they sell goods purchased but not carried in stock, their name should be entered on the vendors' card for the articles in question. STOCK SYSTEMS, STOREKEEPING, AND IN- VENTORIES Details of a Successful Stores System System in a Factory Stock Department Monthly and Yearly Inventories The Perpetual Inventory in Practical Operation Standard Practice for Purchasing and Stores Departments DETAILS OF A SUCCESSFUL STORES SYSTEM BY CHARLES KIST IT IS the intention of this paper to deal only with the forms, books, and system employed by a certain large central generating station of 80,000 kw. capacity in keeping its stores accounting. The various accounts then at the end of the year are charged with their portion of the total storeroom expense. The daily routine of the stores department in this station is ' invariably as follows: Receiving purchased materials and supplies Issuing material and supplies for repair and maintenance work Issuing material and supplies for construction work Issumg material and supplies sold and to be charged to cus- tomers The storeroom is located on the ground floor and is so situated that the loading and unloading of wagons can be con- veniently carried on. A screen partition, havmg delivery win- dows and doors, is placed about the bins to keep those out of the storeroom who are not connected with the stores department. The storeroom is kept under lock and key when not in actual use. At night and on holidays, when the storekeeper is not in charge, the keys are turned over to the engineer or watchman, who makes a report of all material taken from the storeroom during such times. The storeroom at all times is kept clean and in order as far as possible. Bins, shelves, and racks, to accommodate the large variety of articles that are carried in stock, are arranged m sections and are so placed that they have ample room between them to allow the average-sized truck to pass through the aisle, thus allowing new material to be delivered to the respective bins. Wooden shelving and bins with unchangeable sections as well as sheet-kon shelving and bins with interchangeable sections 44 STOCKS, STORES, AND INVENTORIES are used; the latter have proved very satisfactory, because they can be adjusted to any size desired — an essential item at times, as material purchased for the central station changes from time to time. Iron, steel, piping, etc., are stored in special racks. Cement, fire clay, lumber, and fire brick are stored in separate sheds. All oils, except engine and cylinder oils, are stored in iron drums and tanks and are kept in a fire-proof room. Oils used directly for the prime movers are stored in special reservoirs located m the engine room; this oil is charged to a separate account num- ber and an inventory is taken once a month to distribute the charges. It is the duty of the storekeeper to see that the stock on hand is always suflBcient to preclude the possibility of unnecessary delay in any of the company's operations. A list of the mini- mum and maximum amount of material to be carried in stock is furnished the store- keeper by the heads of the departments, and when the amount of any material falls below the minimum quantity, the storekeeper issues to the purchasing agent a requisition. Form A, on which is stated what the material is required for, what it is to be charged to, and where it is to be delivered. Each requisition is num- bered consecutively and a duplicate of each is kept by the storekeeper for further reference. A full description of material needed is also stated on the requisition to insure getting the correct material. These blanks are put up in book form of fifty sheets each. After the material has been ordered by the purchasing de- Electric Light and Power Co. ACQUISITION FOR PURCHASE. •.P«... «.M*L ] FoKM A. Requisition for Purchase A SUCCESSFUL STORES SYSTEM 45 partment, two duplicate copies of the original order, Form B, are forwarded to the storekeeper immediately, thus informing him from whom the material has been ordered, so he can be on the lookout for it. This applies not only to material ordered for stock, but also for any other material. After the material has been received, the storekeeper fills in the copy of the original order. Form B, in duplicate, giving such .^oo ^^ Juiy 21.1915, ^ «-*•*" ^>>^"'^1 «^ Weotlnghoueo ei«etrlo wrg. Co,^'"' 99806 2100-^ c« »-»^ PlUslurg, 7-20-150^ >*^' . . - Stock .-^ jt:^"" 2045-*^ 4. - Four Controlllne Switchee Stylo # 67963 A 40 - Style 154255 Red Lens. 40 - •• 154266 Creen Lena. 80 - " 164275 Lafflp Rooeptaolee. 160 • ^ 166096 Claea tube Foses OMoiWtjrtaO. Male fuO note of tB Mkea or dinugnl (oedi, er ■ Ca In i ii t I «( tny ihorttge. Lid Ktul No«. of all Articla, D^-Ah. • n,^ . Boie»,BaiTeIs, Packaga or ReA oo back ol tbk Sbett THIS IS IMPORTANT, Pro. No- Sui, .ImW Fil.Eio.NUiI Wioa CUrja p.iJ $ . .: W.^ , ^*** ' Form B. Order for Material, Issited by the Purchasing Department information as desired, and sends one of the sheets to the general office daily, against which the invoices are checked. The other sheet is kept on file in the storekeeper's office and entries are made from it to the stock cards. These sheets are filed accord- ing to date received, and prove of great assistance to the store- keeper. Should but a partial delivery be made of goods ordered a partial report is made out on Form C and noted on Form B. A petty-cash fund is left with the storekeeper for the purpose of paying express charges, the amount paid being entered on Form B. 46 STOCKS, STORES, AND INVENTORIES Flpntrin 1 inht anH Pnwpr nnmnanv ..,- 1 RECEIPT FOR MATERIAL. Parth»s!ne Dep«rtmen» ; ' '9' Following tnaterial received this day in good condition except as noted and added to Stores ai shown below . 1 Stock Acct. NO. Quantity Pk«t. DESCRIPTION OF MATERIAL Fro-. . NOTEr— Ttii* report mutt be mads In Ink or Indelible pencil. Report only one deiivenr on this ebcet. APPLIED ON ORDER APPROVED FOR QUALITY ; APPROVED FOn QUANTlTV: Cen-| Storekeeper or Head of OepU Storekeepar. Form C. Receipt for Material A card system is used in keeping a record of the material which is carried in stock. This serves as a perpetual inventory, and from it can be told at a glance what material is on hand, and what amount has been purchased, used, etc. When material is received, the storekeeper fills out a card. Form D, from his daily report. Form B, giving full description of the article, the date received, the order number, from whom purchased, and the amount received. After this card has been properly filled in, it is filed behind its respective guide card. A total of about 2,500 articles, listed under about 250 head- OKcnpiioft ««mm Six* ACCl CiTtjrto ' M.n,mum l.rt«o. ■ M«TIfli*l BtCtlVEO MATEfiUL 0£L1v£RtO 0., Oidtr a. r„m c...,„ o.„ UISL M To "»"*'' 1 J _ _ _ _ _ .._ .^ Form D. 5 by 8 Inch Card for Record of Material Received and Delivered A SUCCESSFUL STORES SYSTEM , 47 ings, is tlie average stock carried at all times at this particular store; this amount may increase during a period when special construction work is going on. When material is to be withdrawn from the storeroom, an order on the storeroom is made out in triplicate by the foreman in charge; this order blank is shown by Form E, and when filled out, gives the date issued, what the material is required for^ the THE ELECTRIC LIGHT AND POWER CO. ONBIR ON STORtKIlriR-ORiaiNati, N9 3f501 Plaase furnUh followine materlnl for — . ■■ — — — ■ ___ 1 i^S' iixiulre4 OIMBIin-ION OF MMEHlAl LMHa. •I Cha/T*tc» - Accowfil No. AmowoA 1 - - 4ppra<(*d: RmiIvwI br 4NCHABOI. ' 1 HAn-TTtIt een t* M ^filfJM to th« Auditor. FoKM E. Order on Storekeeper for Material quantity and description of the material required, and the charge account. A separate order is made out for the goods used on each job, so that as near as possible one charge-account number will ap- pear on each order. Care is exercised in describing the material so as to eliminate errors arising from lack of identity of goods for delivery and pricing. The account number is carefully se- lected and inserted by the foreman on the job, because he is in the best position to know where the goods are used. Account numbers should also be written distinctly. The storekeeper on receipt of the original, duplicate, and triphcate order, fills the order as completely as possible, but if he cannot fill it completely, he draws a line through the portion unfilled. He secures on the order the signature of the person 48 STOCKS, STORES, AND INVENTORIES receiving the goods. Each item is then posted to the credit side of the stock card bearing the same lot number, and the entries include the date issued, the storekeeper's order number, and the quantity delivered. In this way a correct record can be kept of all material carried in stock. The original is then sent to the auditing department for pricing and auditing, and the triplicate is sent to the head of the department using the goods, the duplicate being kept by the storekeeper. The original, after being priced, is filed in a voucher bearing the same charge-account number, and at the end of the month the sum of the amounts of the orders filed in the voucher is charged against its particular charge account, to stock credit. The duplicate serves as the storekeeper's receipt, and the triplicate serves to inform the head of the department what material is used on different jobs. A quadruplicate leaf remains in the foreman's book. The head of the department glances over the material charged to the various jobs and reports all corrections to the auditing department, so that changes can readily be made before entries are made in the journal. When material is returned to the storeroom for credit, a credit slip in triplicate is made out on Form F by the foreman who returns it. This form is filled in with the date, the quantity and a description of the material returned, the value, and the credit account. After the material is checked by the storekeeper, both the original and the duplicate slips are signed by him. A card is made out for each item, unless one is already on hand, and the lot number, the description of the material re- ceived, the date, credit-slip number, the credit account, and the quantity received are entered upon it. After the stock-account number is put on the credit slip oppo- site each item, the original is sent to the auditing department, where it is priced and credited to the proper account. The duplicate serves to inform the head of the department of the material returned from the different jobs, and is examined by him so that he may report any corrections to the auditing de- partment before the entries are made in the journal. A SUCCESSFUL STORES SYSTEM 49 9upt. □ectric Light and Power Conpany MatertaT Retureed to Stores— Ori^' Ipirmil: Stpl Slorehe|»r Form F. Record of Material Returned to Stores These blanks are also put up in book form of 50 sheets each, the triplicate remaining in the book. When material is sold, the transaction is recorded on Form G, to which is attached the signed dray ticket, space being reserved ELECTRIC LIGHT AND POWER CO. ComfitroUer and Auditor: Charte (or Maierial Delivered fo Order No.. DESCRIPTtON or MATERUL ClffiDIT FOE MATERIAL RETURNED i Maltrial Sold (rom Stock— Orijinal 11725 * ScUisg Pricet ApproTcd. Form G. Record of Material Sold 50 STOCKS, STORES, AND INVENTORIES ELECTRIC LIGHT AND POWER COMPANY. ffO J5|8 MATERIAL RETURNED FOD CREOIT-ORICINAk. PURCHASmO AGENT: 'The fotlowmc matflrl&T pravlouslv purchued hat b«en reiurned to Va. FRT.-PREPAIO-COLLECr ~ ' ' [ DCUCRirTION OF MATCniAI. LOT ««. iieT DISCOUNT AHOWHT 1 I ' ' ' Thtir Ord sisNEo necEiPT ATraeHEo. FoemH. Recobd for the Return of Material Previously Purchased to fill in the name and address of the concern or person to whom material is sold or returned. After the items are posted to the credit side of the stock card, it is sent to the auditing depart- ment for billing. A separate form, Form H, is used when material is returned for any reason. This is filled out and handled in the same manner as Form G. The success of any system rests entirely upon the personal un- tiring efforts of the storekeeper in seeing that certain essential rules pertaining to the operation of a storeroom are enforced. He must insist at all times on the proper papers being made out correctly before he delivers material or accepts any that is returned into stock for credit. He should from time to time consult with the heads of different departments as to the advisability of replenishing stock that may have run below the minimum amount, so as to insure against purchasing material which may prove useless under new conditions of the market or of construction. The department heads should also furnish the storekeeper with a minimum and maximum list of material to be carried in stock to serve him as a guide. As this is a perpetual inventory, it has many advantages. A SUCCESSFUL STORES SYSTEM 51 It gives an exact knowledge of the stock on hand, thereby enabling the storekeeper to purchase intelligently. Errors or theft can readily be discovered in time to prevent any embar- rassmg shortages. By no means the least advantage is that it permits an accurate handhng of the stores. SYSTEM IN A FACTORY STOCK DEPARTMENT BY G. H. CULVER THE absolute necessity of a properly organized stock de- partment is to-day acknowledged by all large manufac- turers. There should be one place in every factory where information can be quickly obtained as to quantities of stock on hand, and consumption over any period and the value of the materials which are being used. The stock department should be able to supply this information. Stock material in any factory represents dollars and cents, and these materials should be protected and accounted for in as accurate a manner as the money handled by the treasurer's department. The departments in the factory should not carry the stock needed for their own use. The foremen of every de- partment should give their attention to production — quality and quantity. In the same factory different foremen might have different methods of handling their stock. In the same factory, certain materials are used in all departments. The stock department, knowing what each department uses, is in a position to buy in quantities, and from the average consump- tion is able to fix a minimum figure. The stock department should be responsible for the proper ordering, receiving, storing, and disbursing of all materials. In view of the fact that different conditions control different in- dustries, and the quantity and kind of materials used by differ- ent manufacturers vary so greatly, it would be very difficult to install a ready-made stock department in any company. It should be developed from the experience and nature of the busi- ness. The system as here outlined is one which has been gradu- ally built up with the view of ordering, receiving, storing, and disbursing materials in the best possible manner for one of the largest manufacturing companies in the country. Each of the divisions of the department work will be taken up in detail. 52 Ch«rKe ...f „ „..Oat« QUANTnV S, e. Co., Factory A „ Fig. 1. Authority for Ordering SYSTEM IN A STOCK DEPARTMENT 53 Everything needed for equipment and production is ordered by the stock department, and is charged either to stock or to some particular account in the factory. The order is charged to a factory account only when the material ordered is, upon receipt, to be applied directly to that account. All requisitions from superintendents, foremen, and depart- ment heads for machinery, repair parts, materials, and supplies not regularly carried in stock should be plainly written, with as complete a description as possible, on a blank like that shown in Figure 1. After this requisition has been properly O. K.'d by the superintendent, it is sent to the storekeeper. This requisition should show the date on which the supplies are needed. All materials which are carried in stock are under the juris- diction of the storekeeper, and should be ordered on a minimum basis. The minimum figure should be decided by the rate of consumption, closeness to source of supply, storage facilities, and price conditions. This minimum figure should show on the stock card of every commodity carried by the stock department, and just as soon as suflScient issues are made to bring the stock on hand down to the minimum figure, orders should be written by the stock department for more material in such quantities as may be decided by the same conditions which govern the minimum figure. The orders as shown in Figure 2 are typewritten, four copies of an order being made at one time, each bearing the same number. After the order is written by the stock department showing detailed specifications and account to which material is to be charged, three copies of the order are sent to the purchas- ing agent, who upon receipt locates the material as called for, and after satisfying himself as to price and delivery, fills in the name of the concern to whom the order is mailed, and the date on the three copies he receives. He then mails one copy, retains one copy, and returns one copy to the stock department. 54 STOCKS, STORES, AND INVENTORIES so that the latter knows where the order was placed and when. After the concern, name, and date of purchase are entered on the copy of the order, bearing the same number which was held in the stock department, of the two copies it now holds one is filed numerically and one alphabetically, to await the receipt of the material. When the order calls for material not regu- larly carried in stock, the order is indexed on a card under the name of the material ordered, so that whether the material is stock or not, quick reference can always be had by name of material, order number, or concern name. Regularly, once each week, all unfilled orders are taken out of the file, and inquiry made of the purchasing department as to date of delivery. In writing the four copies of the order in the stock department it is the practice always to show in the margin of the order the name of the concern from whom the last order for the same material was received, together with the or- der number. This information assists the purchasing agent in placing the order. Any remarks as to quality, poor delivery on last order, or suggestions to the purchasing department, are made in the margin, unless they are of such a nature that correspondence is required. When satisfactory delivery has been made of the material called for on the purchase order, and the order is considered complete, one copy is placed in a "filled" order file, numerically, and one under the name of the concern supplying the material. It will be seen from the above that it is an easy matter at all times to refer to orders filled or unfilled. The materials ordered, as stated above, are either charged to stock or directly to the account to which the material is to be applied upon receipt, such as a machine for a definite operation or an instrument which is to be used on one class of work. When the invoice is received, it is checked in the purchasing department against the purchase order, and the charge as shown on the purchase order is posted to the invoice. When the invoice is paid, the proper account is charged with the amount of the invoice. The copy of the purchasing order which is returned to the stock department showing concern name and date, when calling for stock materials, is entered on stock card I ! I OrJtr Mo. A 8787 NATIONAL CARBON COMPANY fitett lurnith la et/Bji fuotatioit ei A 8787 !:Br.'3i^i'iM^5S)Eff;aft?S3SKaHSa?Sa^ IN9U Pica I _«M^S.. 1 ■ 1 ■' § 1 1 iV 1 J I,. A « 1 L_ ' 5 i 2 1 1 1 1 1 1 .... » «,^W'»'—-»w- ««*«*« «-«-;#*«• "• ri ■wi "T^aTuc^w 1 i - ^ »S5i ^ »!»4iit$fiio ja iioitito/it joal to to i/$!iunj atti/j _ — :s;s. A.MVaWOD KOaMVO TVNOIXVM AMVdIMOO MOSMVO TCVJCOLLVX Fig. 2. Face and Back of Order Blank SYSTEM IN A STOCK DEPARTMENT 55 shown in Figure 3. This stock card has many valuable features. A stock card is made out for all regular stock materials. A complete description is shown on the card, the minimum is shown, and location of the stock, also the blue-print number if the article is covered by drawing specifications, the name of the concern supplying the material, the order numbers on which MINIMUM Olli A/» % Arrr TO oKDOt Unit OoMcerfTAf 1 a«?72 O/foeff QoMfirry OST DfSGT flMT/NU, r/f'r Unrr Cost t/ETCOST Rec'o /SSUEO ^ssueo Om hand /\»'t 1 ««*. "i*J Fig. 3. Stock Card The word "minimum" on the original is printed in red the material is received, the quantities issued, to whom the material is issued, the stock on hand, and the cost of the stock. By referring to this, quick reference is obtained to previous pur- chase orders by number and concern, the prices paid for previous receipts and discounts, the quantities ordered, and the con- sumption over any desired period. The card also shows how much stock has been issued to different accounts, and a per- petual inventory is shown with the amount extended. The stock department receives all materials. When any or all material is received on a purchase order, both copies of the order are taken out of the unfilled file, and the material checked directly against the order, to see that it conforms to the specifi- cations. As the storekeeper has no direct dealings with the people supplying materials on purchase orders, unless requested 56 STOCKS, STORES, AND INVENTORIES by the purchasing agent, all irregularities regarding receipts, such as shortages, poor quality, or material not up to specifica- tions in any way, are immediately reported in writing to the purchasing agent. Everything received is reported daily on a form (Figure 4), typewritten, giving date, quantity, description, order number, from whom received, carrier, and charges. DAILY REGISTER OP GOODS REGEIVED. 1 Shipping Lot ■<*■ ■ Inspection Lot _ — - - - — Factory | gunm Descnption Miaii nainMiBaia CU la. oonaan tuma -. J 1 Fig. 4. Daily Report of Goods Received A green form printed and ruled exactly like this original is used for the carbon duplicate This daily report of goods received must be in the hands of the purchasing agent not later than noon of the day following the receipt of the material. This is necessary in order that invoices may be passed and discounts taken. The report is written in duplicate, one copy being retained in the stock department. All stock material received on this daily report is posted directly on the stock cards. Material ordered which is not for stock is delivered immediately, and receipt obtained on the copy of the order. The stock material is checked carefully for weight, count, and quality, and if satisfactory is placed in stock. Care is always taken so to place new stock that the old stock will be exhausted before new stock is issued. Full details of the re- ceipt as regards date, weight, count, and conditions are entered SYSTEM IN A STOCK DEPAKTMENT 57 Suft'sO.IC.. Sfiprovad — Car Ho. Amt. ^^^^^ OnlerNo.r< 8477 MOTt 9»ea m/M»ta m bill NATIONAL CARBON COMPANY acu. -moHONt ntoac 4ot. cuY. cchthal I ia«. MAIL AOORUS. BOX 400. COB. WEST MADISON AYE. AND tWtli ST, N. W. Clewland, Ohio, Phase furnish as at fOVPU"''f<'^'> *' juidship ifia 1= NATIONAL CAKBOM CO. MARK PK8S. Fig. 5. Purchase Order Blank on' the reverse side of the purchase order (Figure 5), in the space provided. All stock received as soon as accepted is marked with identification tag (Figure 6). On freight, express, and INQUIRIES PROMISED SHIPPED VIA REMARKS:- ' > z r i i Z » 1 2 3 4 5 6 7 8 Fig. 5. Reverse of Purchase Order Blank DESCRIPTION BOX) No. f aUANTITT FBOM DATE ORDER 1 CHECKED BT REMARES:- '■"""'••'■'•" 58 STOCKS, STORES, AND INVENTORIES local deliveries, care is taken that signature is not given for any damaged material unless this damage is so noted on the delivery bill. All breakage or damage in transit, local, express, carload or less than carload freight, is immediately called to the atten- tion of the purchasing agent in a letter, a copy of which is sent to the traffic department, in order that inspection and adjustment may be promptly made. No material is placed in stock until properly accepted as above. Stock is kept clean Fig. 6. Identification Tag and orderly, and stored as near the point of consumption as possible. All sections are lettered, and bins and drawers numbered. The location (building, section, and bin) is shown on each stock card. The nature of the material of necessity controls the method of storing and handling, espe- cially in the case of oils, chemicals, and large-bulk stocks. No material is issued by the stock department except upon properly signed stores orders, which are the same form as shown in Figure 1. A list of those authorized to sign stores orders is in the hands of the storekeeper and no unauthorized signature is accepted. The stock department delivers all ma- terials to the departments throughout the factory. Each morning at 7:00 o'clock the telephone order clerk in the stock department telephones each foreman in the factory and inquires if there is anything needed that morning. A record of these telephone orders is made on a duplicating machine, one copy of the order being given to the stock boy who collects the ma- terial. He exchanges the copy he has for a stores order which properly describes the material. This stores order is given to the telephone order clerk by the stock boy, who compares it with his original telephone order for final check. During the day if the foreman of any department finds that he needs ma- terial which was not ordered that morning, he telephones the order clerk in the stock department and the material is sent to SYSTEM IN A STOCK DEPARTMENT 59 him. Monday morning the stock department dehvers oils and waste to the entire factory, in sufficient quantity to last the entire week. By making these regular trips, and keeping the factory supplied, many expensive delays are avoided. Work- men are not running back and forth to the stock department, and machinists and carpenters are kept on the job. Since the installation of this delivery system, the men have gradually learned to anticipate their wants. Very often even the wants of the mechanical departments on repair work can be antici- pated far enough ahead to avoid delay. The stores orders, as received for materials issued, are posted to the stock cards the morning following the date of issue. At the time of posting each order, the entry clerk compares the balance remaining in stock with the minimum figure, and as soon as that figure is reached, the card is removed from the file to the check box, and the stock immediately checked against the card (inventoried). By this method of inventory, the most active stocks and those used in the largest quantities are the ones which are inventoried most often. It will be seen that this is much better than inventorying the stock only once a year, or once in six months. MONTHLY AND YEARLY INVENTORIES BY H. A. RUSSELL THE commendable habit of building batteries of storage bins provides a means of keeping the floor space clear of the various castings, steel parts, etc., and also assists materially in the taking of the yearly inventory. With only one kind of casting in each bin, the counting is simplified. It is not necessary to sort out the castings first as is often the case when the different items are scattered over the floor. Contrary to what a great many people may think, the hardest work connected with the taking of the yearly inventory is not the counting and weighing but the planning, in the first place, and the determining of what the correct values should be so that the total amount of the inventory in dollars and cents will reflect a fair market value. This article is based on the method of taking a yearly inventory, and keeping a perpetual inventory of many thousands of parts, in the rough state, partly finished, and finished, in a factory manufacturing a large line, in fact many lines, of farm implements and heavy machinery for do- mestic and export trades. No effort has been made to show the monthly values of the thousands of items on hand, but, from the information which the records afford, it would only be nec- essary to go a step or two further and a complete monthly in- ventory would be the result. So far it has only been worked out on the monthly basis for the finished product. The entire pro- duct is divided into seventeen classifications. On the third day of each month the report shows, for each classification, and as a total of all classifications, the quantity and cost value of all completed implements and machines on hand, so that shipment can be made within a few hours after receipt of the customer's order. In planning this system there were four separate groups to be taken into consideration. It was considered necessary that 60 MONTHLY AND YEARLY INVENTORIES 61 the final summary of the yearly inventory should indicate the value of each of the following subdivisions: materials, goods in process, finished product, supplies. It was also necessary to total the weights of certain items, such as gray-iron castings, malleable-iron castings, boiler plate, etc., so that there could be a quick comparison made with the totals of previous mventories. In the instance of certain items, such as boiler tubes, the com- parison should be made on the basis of the total number of feet of each diameter tube. It is not a hard matter to arrive at fair cost figures for the items of material, finished product, and supplies. The fourth item is not so easy, as an item of goods in process may have only one or two operations completed at the time of taking the inventory, while a similar part may be further advanced and even finished, ready to assemble with other parts. Again there may be a group of parts, such as an engine cylinder complete with cylmder head, steam-chest cover, jacket, studs, etc. There are twenty-four separate departments in this factory, and as stated before, the product is divided mto seventeen classi- fications. ^ Some of the departments turn out parts for all of the classifications. In other departments only certain classifica- tions are manufactured. It was therefore necessary to plan carefully, so that no item would be overlooked or included in the incorrect classification, no matter m what division of the factory it might be found. Units of the finished product are constantly progressing from one department to another. They may be found in storage bms or on trucks. Many similar items were found in different departments, some finished ready to assemble, others partly finished, and others in the rough state. Parts in the rough state were treated as material; parts finished and partly finished as goods in process. All of these facts are mentioned merely to show that the workmg out of the inven- tory to a logical conclusion was not an easy matter. The result indicates each year that approximately 40,000 separate items have been counted or weighed, listed, and valued. A month or so before the inventory period instructions are sent out to each of the foremen, assistant foremen, and office men. Several weeks before the actual takmg of the inventory 62 STOCKS, STORES, AND INVENTORIES starts a meeting is held and all attend who have received a copy of the instructions. The matter is discussed thoroughly and memories freshened. Naturally we get better ideas each year. When the time arrives the factory is divided into fifteen differ- ent sections, several of the smaller departments being incorpo- rated in one section. In several of the larger departments it is necessary to have two sections. In order that there may be no confusion as to where a division of a large department stops, a broad white line is painted on the floor. During the inventory period, which usually lasts about four days, the writer spends his entire time passing from one group of workers to the next, answering questions, simplifying the work when possible, seeing that all are supplied with inventory blanks and in general en- deavoring to have the reports in such shape that the cost de- partment will have the minimum amount of work to do when the reports are all in and ready to be valued. In the fifteen groups there are about fifty workers in all, some counting, others weighing, checking, and filling in the blanks. Some groups consist of two men, others have up to seven. The counters went first, the writers and checkers following from one to two hours later. The factory is closed during the entire period as it would be practically impossible to secure accuracy otherwise. The following general instructions are sent out to each party interested: INVENTORY METHODS AND INSTRUCTIONS We will have the following nine divisions to consider in taking the inven- tory. 1. Materials in stockrooms. 2. Supplies in stockrooms. Both of the above will be inventoried from the stockroom cards. 3. Materials outside of stockrooms. 4. Supplies outside of stockrooms. 5. Goods in process of manufacture. 6. Inventory of finished product. 7. Repair parts in repair stockroom. 8. Lumber outside of factory. 9. Lumber in factory, which may be material or goods in process, as the case may be. MONTHLY AND YEARLY INVENTORIES 63 We will first consider materials and supplies in stockrooms. The stock- room keepers will report as heretofore, that is, the office will make up the in- ventory for stockrooms from the record cards. These cards must be com- plete and up to the minute, so that a list of all the items and quantities can be made. These cards will be caUed for on December 26th. (See also separate memorandum to stockroom keepers.) Materials outside of the stockrooms, and which are not included in the in- ventory of finished product, and which are not goods in process, i.e., items upon which no productive labor has been applied. Please note that trucking and handling are not productive labor. These items will be reported on the regular inventory blank. Supplies outside of the stockroom consist of items that have been requisi- tioned but which are not intended as a part of the product, such as planer and lathe tools, files, chisels, twist drills, etc. Goods in process of manufacture, or materials on which productive labor has been applied and which will later become part of the finished product. The value of these parts must be determined by adding to the value of the material the amount that has been paid for productive labor. It is therefore essential that the last operation be reported, when the part is not completely finished. The inventory value will vary according to the amount of labor that has been applied. Where several parts are grouped together there will be added the cost of assembling. Do not forget to include in the list bolts, washers, or rivets. Inventory of finished product. This will be attended to by the production department as heretofore. Great care must be exercised that the items which the production department include in their report are not duplicated on other reports. For instance, the woodwork for a cornsheller may be in the warehouse and the ironwork in the storage bins. The production depart- ment will include in the finished inventory report the number of complete cornshellers that can be shipped, the surplus parts will be treated as goods in process. The production department will therefore deduct from each inven- tory slip the quantity of pieces needed to match up their report of complete cornshellers and the balance shown on the slip will be treated by the cost de- partment in the same manner as any others goods-in-process item. Repair parts in repair stockroom will be reported by Mr. , giving the quantity, description, material name, and classification. All lumber, that is, boards, planks, or dimension stock will be reported by the lumber inspector. Dimension stock will be reported by grade, width, thickness, and length, also by quantity of each different size. Calculations will be made in the office. Boards and planks will be reported by number of board feet and grade, also by the name of the wood. This paragraph refers only to material in the lumber yard. Lumber in the factory will be treated as material, providing no productive operation has taken place, otherwise lumber will be treated as goods in process. 64 STOCKS, STORES, AND INVENTORIES Brass, bearing metal and hydraulic metal casting weights will be furnished by the production department. Also the weights of all gray iron castings. Malleable and steel casting weights will be furnished by the purchase de- partment. This same department will calculate the weight of all steel bars and plow steel slabs, also I-beams, channels, angles, tees, etc., and plates and sheets, whether black or galvanized. The above instructions were general and further instructions were sent to each department. To the foundry was sent a list of everything that could possibly be in that department and which would affect the inventory. As it would not be prac- ticable to weigh the different grades of sand that would be in the bins, the memorandum gave the weight of the last carload of sand that had been unloaded, of each grade, and the foreman estimated the quantities on hand. The departmental inventory report (Figure 1) is used in all parts of the factory, excepting in the foundry, stockrooms, and lumber yard. The illustration shows one of the reports as it DEPARTMKNTAb INVENTORY REPORT T53r ^. ,'^^^Jk- ■- 0-N.V.. Oawhy /*/ Sim f/iX// P.I.N«.yri.l.i.JCr»l. <»/<:3^^£^ Ro.WtlPc//y T»nl Wd, Tot^mK TMiktA --^ Pmly rinblicJ B«u«l> It pMdy Fimihed qtaqfyttrt oPCTrntioi ToUl Material Cort .I f .^if.oy would be received in the office. The reverse side is used when there are two or more parts attached. All of the slips are numbered, starting with 1 and going up to 40,000. They are Fig. 1. Departmental Report proportioned to each depart- ment before the actual work starts, so that the numbers will run consecutively for each. Every numbered slip must be accounted for at the wind-up. This does away with the possibility of some of the slips being lost. No more than one item can be reported on a slip, but one item may consist of a group of parts, as for instance the engine cylinder with cylinder head, etc. To quote from the departmental instruc- tions, as regards the proper method of filling in the report slip: In filling in the inventory slips you will record the following information: 1. Department number. 2. Classification number of parts. 3. Description. 4. Quantity, that is, the number of pieces by actual count. MONTHLY AND YEARLY INVENTORIES 65 5. Size. This will include width, thickness, and length, if for a flat piece, or diameter or square and length, if for a round piece. 6. Pattern number. This includes the designating letter, if any. 7. Material and grade. If steel, report whether soft or hard, plow or spring. If lumber, report whether oak, pine, hemlock, etc. If a casting, report whether gray iron, steel, malleable, brass, bronze, aluminum, or babbitt metal. 8. See memorandum on weights. 9. Total weights, these will be calculated by the oflBce. 10. Place check mark behind finished, partly finished, rough, as the case may be. When the piece is only partly finished, report the last operation by name. 11. Material and labor costs will be filled in by the cost department. 12. Write in any remarks or information which you believe will be of assis- tance to the cost department. Sign your initials to each slip. Also the following memorandum is sent to the stockroom keepers : The stockroom inventories will be divided into two groups, namely, materials and supplies. The office will make up the inventories for the stock- rooms from the daily record cards. There are a few items which are not car- ried on these cards. Please report these on the separate slips of paper which will be sent to you at the proper time. There are also certain items which are stored outside of the stockrooms but which are carried on the stockroom record cards. Please fasten a large tag to these items and state thereon that the item will be reported by the stockroom keeper. Otherwise we will have a duplication of certain items. The memorandum which is sent to each foreman is as com- plete as it is possible to make it and, of course, varies with each department. It required considerable thought and knowledge to work out the basis for the original memoranda. To show how complete these memoranda were and are, the one which is sent to the boiler department each year will be given in its entirety. FOREMAN OF BOILER SHOP You will report the following materials, supplies, and goods-in-process items in your department as follows: Boiler plate, material. Report quantity and grade and size of each plate with thickness. 66 STOCKS, STORES, AND INVENTORIES Tank steel, material. Report quantity of each size plate, with thickness. Boiler plate, goods in process. Report quantity and grade of each size plate, with thickness, also each productive operation. Boilers, goods in process. This item will cover boilers that are not com- pleted. Report actual plate sizes, grades and thicknesses in each boUer not finished, approximate weight of rivets, gray-iron castings, stays, braces, mal- leable castings, boiler tubes by quantity, size, and length; also aU labor on the individual parts and on the boiler itself. Tank steel, goods in process. Report quantity of each size plate and thickness and actual productive labor, according to classification. Rivets. Total weight of each diameter. Tubes. Quantity of each size and diameter of steel tubes. Also of char- coal iron tubes. Punches and dies in stock or on the floor. Report these as imused, partly used, or (practically) worn out. Castings, gray-iron, goods in process. Quantity, description, symbol num- ber and classification. Castings, gray-iron, goods in process. Report by quantity, description, symbol number, classification, and the amount of productive labor in your de- partment or the name of the last productive operation. Twist drills. Quantity of each size; specify whether high speed or carbon steel. Report condition the same as for punches and dies. Staybolts. Quantity, size, and length. Braces. Quantity, size, and length. Advise whether dead soft steel or pressed steel. Manhole saddles, complete. Quantities and size. Pipe flanges. Quantity and size. Staybolt taps. Quantity, size, and length. Report condition. Fireclay. Estimate weight. Firebrick. Quantity. (Boiler-setting quality.) Firebrick for cornish boiler linings. Quantity of sets for each size boiler. Gaskets, material. Quantity and size. Gaskets, tubular manhole. Weight. Wire netting for cornish boiler linings. Number of lineal feet. Castings, malleable iron. Quantity, description, symbol number, and classification. Angles, channels and I-beams. Quantities, size, and length, weight per foot or thickness of web for I-beams and channels. Soft coal. Estimate weight. Pea coal. Estimate weight. The last carload weighed 34 gross tons. Chisels, calking tools, rivet sets, stay bolt sets. Quantity, size, and condi- tion. N. B. Include all tank and boiler quality plates and templates which may be used later in the product. s €& SOI 6 d 5^ ^1 z z i 9 3s at^ lis ^ V ^ ^ '^ fi L*^ >, N 6 z s \N t 1 = AN V V V) .? < u a- *> ^ ^ Q ^1 ^ ^ ■ N 1 J-l '^^ ,\ i > c: o t ' ' c a U ;'! liJ ♦ q: z ^ >- o: \ h z n ^4 < D Z < ii ■s -5 ^ T V N K 1 ■v N ' 1. , ,„,. INVENTORY RECORD ^"""^ '^"'^ January tsr. 1©16> ,^0, . ■ ^ , V9T^/t^^/^ CLASS NO. DEPT. No. ^ Ouintlty SylD. No. Deurlptlsn Slu MtUrlal and Qrad* 1 ' Tout Weight Kate ani< Uall Totil MiUfId Total Ulwl Total Material i PSu> -^ Libor and Bx^nM 1 // /('j/y ^/^.. ---,^.^ -j/ t/^/? y / 4f // ^.J// / cfi/ /I/1'/ 3'/.^ ,f-5 //r /7 .^^^7 „ ,. rx-^'' 0^ ^/ // /^J#/ /^.,^.y,.;^ * - /a A^rr .3/^^ f? ■f(! /?J>^7 .. // * .y^ >rv /#/?/ ^^ <-" r.^ .r^- >? / .',9 r>SI ^ /f'^r f'// 9Ji^t7 y/ jirr 7^f /'r' « » /-/// ArAD y r',' ifl /j- ^,'?;.' - //*■/ /?/./» -y •'?,} tt / .!ui.«^y h y.5/; y^/ ■ ^e rr /v /^.i/»V i:z^.^ . .i-^io' .^/.^ /f/ /' f/rr * .r'/D A-yy /(A « yj /' ^f V(f / "^"--^^ ^~~---,^ ^"^-^.^ -^^ "^^-..^ ^^^\ ^ "^^-^^ ■-^^ ^ ^~^ ~^ --^ -^^ JAi.'/J T«UU year ^ .1 1 Fig. 2. Sheet for Loose-Leaf Binder for Inventory Slips MONTHLY AND YEARLY INVENTORIES 67 Further instructions were sent to each man who would be in charge of each of the inventory groups somewhat as follows: DEPABTMENT 6, FIRST DIVISION Mr. T will have charge of this division, and be assisted by Mr. W- and two or more helpers. This group will inventory everything on the first floor of Dept. 6, starting with the contents of the north shed and continuing southwardly to the broad white line on the floor. Inventory slips numbered from 1 to 3,500 inclusive will be used in this division. Even though you do not use all of the slips they must be left in this division, so that when the slips are later gathered none will be overlooked. This will prevent confusion. If the slip accidentally should not have the full information required, the num- ber will serve to locate the proper division and furnish the opportunity for securing the information later. When the inventory slips are all gathered, they are sorted according to department into the seventeen different classifica- tions for goods in process, also for supply items and for mate- rials. The material slips are sorted, as far as possible, according to the actual material. For instance, all items of gray-iron malleable, steel castings, bar steel, etc., are kept together, so that when the inventory is completed, and the weight of the in- dividual items totaled, there will be a means of quick compari- son with the total weights as shown by previous inventories. Figure 2 shows the large loose-leaf binder sheet which is used in listing the inventory slips after the value of the material (and labor, if any) has been figured. When a labor item is involved, a percentage is added which represents the average overhead charges for that particular department. This per- centage average is made up from the records which extend back for several years. The inventory record sheets are numbered from 1 up for each department. The departments are kept separate by cloth-tabbed mdex sheets. These tabs bear the number of the department. Figure 3 shows the final summary sheet. A means of having a three-year comparison is furnished. Here we see the method of comparing the value and quantities of each item, as well as the total value, year by year. None of the figures that are given are actual but will serve for the purpose of mdicating the 68 STOCKS, STORES, AND INVENTORIES method of filling in the different forms. The cost of the gray- iron castings includes the labor of delivering them to the differ- ent departments. The pound value is worked out carefully by the cost department. Figure 4 shows the monthly inventory of finished product. This record also serves for the yearly inventory, as the informa- FINAL INVENTORY SUMMARY AND COMPARISON ^^k^i^^Jc-e^ic.^^ ^/ ^a^t^.M^'o^'^'t-f / "^/fyjr J-a^^.^ .a^t^ /•*^/f/<4 .lllf^-1 1 1 II 1 1 1 Quantity Material Ubor PhiB » Hfg. Exp. Quantity Uatarlal Labor Ploa ^ 1 *(> -^.J. yfa^L.^.a ^iffoa/ ''/ioyy- 9/ '^7/ // S^07j-o* */J-/a'^ 27 *>79*^ lb -/. ' •' ' iV-fifr*^ /7¥7 Oi 7// // S3/JfO0 /i>/p >3 7/-^ A^ , *"-$ ?Ua.^ifU^^ ^a^i^<^^ /fsr*' ■ /y 7 C 'O Ji-Z/O* /^f sv /y' fo *o - ^p>r* ^s-/ /v /f /-y Vi/O^ >rj/^ n >7 (O "^6 /l^//Lfiii■o^.■^/l^A,^ /^£,7l>* J/?-/ /r f^MO ff /3f/a6'^ JJV** ^C JJ/V /v */^ ' " ■ " ' - /j-o^re,*' ^Pff ¥ >fC /f ?¥Jai>* Jo77 e^ J/'i^' ?r V " 3e /oy* ■f'// '9 . >f/ 7^ ^■/TV/* SV3 // 37-C 90 #^^ » " " ' ' :i.^v;^* Js/ fi. /j- fJ 3>-f/* ¥f // >? ^ ^6 S,iU^*^c^€^L^^/ //y/7 ?(■ ^/7i^ fj /y-^/-^ 'f •r//7 'f 'V ■• " " '/ /if'P' 7r ?-/i ?7 ///y yf /n /y "// " " •*'/ >f/ •4 /fj >/ J// i? ■^o; s^ ^T-O " ■■ *■/ /f3 .. ?/ 7/ ^/ ^ ^ o o /o o o (7 /o, /c//^ /^///^ ' y/M/' /f //.^ aoz/.P 2S- mP 30 M/^' SSM/' 4^>mP SO///' >e.£,.,c^. ^ KJ-t-Ai ^<-i — A"< y^j^ pj' A^ ea-<£-- . ll^c^&ti r.<^o^ x-<-<2^ ^t^-«-<2 ■iTT^.^^. •/-d. t^ AS —-i-e-C ,JU^ /!tiS -^ ^t^ 4^ n^*^ '<^i,^ ih^ X. Y T^d^, ^t-^-rf^TH -.—_-»<. t^f^i^^Z^i ^-^2. !?:.c iy i ^*t.<-^- ' */• . r.^^^c-^ -_- y^-^ >'-' -?; !L.L.^ rA^. , <7 u d .-»«/T. ^^ ^f^.^ (4;<-t ^t j^ -<^^t^ ^ _— -w^ a,>-< - f^ ^-^:, ^^^^ , ^ J ^i'^ r^ fl^' ■i^^^ feJ^ fe-Klt, y-*^ S£i---i. --l^^*-^ -*T'<- /) . Touil on Hand •• Value , •■ BaOt Fig. 4. Sheet for Monthly Inventory of Finished PRODtrcr 70 STOCKS, STORES, AND INVENTORIES Figure 5 shows the production-operation cost-record card which serves several purposes. It furnishes the means of having a perpetual inventory of all items of goods in process. Further than this, it shows the labor value of each and every item on which the first or subsequent productive operation, or operations, has or have been performed. These cards are used in keep- ing track of thousands of items of goods in process. At the end of the year there will naturally be some discrepancies between the amounts shown on the cards and the amount reported through the inventory slips. The proper corrections are then made. If the inventory slip should indicate that there were ten A219 crankshafts on which the third operation had been com- pleted, and another slip would state that five of these crankshafts had only the first operation completed, the cost of the productive labor, in either instance, can be ascertained from this card. A great deal of preliminary work can be gotten out of the way before the real inventory work starts. Figure 6 shows the card which is used in all the stockrooms for the perpetual inventory of all the items in each room. A week or so before the inven- tory period arrives, yearly, these cards are brought into the main office (as they can be spared from the stockrooms) and all the different items are listed on the inventory record sheets. Neither the quantities nor the total values can be worked out at that time but the individual values can be filled in, so that when the cards are called for again the quantities can be entered and the extensions carried out in a much shorter period of time. Figure 7 applies more particularly to items which are somewhat out of the ordinary. In almost every stock there will be found items which are more or less special and which are not a part of the regular product. These odd items are recorded on these 4x6 cards. The cards are then filed under the proper index and the following year considerable time will be saved by having a record which will promptly settle the question of inventory value. If the part is a special one, the probabilities are that it will be considered as only having the value of scrap by the time the second inventory period comes around, whereas if these cards were not on file many items would be carried along indefinitely at an improper value. I <>. g 1 o a o u z ^ a lU a. z F o O a: Q. .^ 2 1 i li i| *i i 1 'u 1 1 °. %. 1 =" o i ■J 2 1 ' I } I VS 1 » ^ A. 1 s M *5l IS U} V* .^.1 « h 1 ^ ^ .^ B 1 vs a o Z 1 vS ill ^ 1 » ^ ^. X V. o« ^i} vS ■^il lU ^ a: -J s .^ i 1 vji 5 Q ^ 1 v» ^ 1 J va K 1 & ^ \ _ ^ V 1 ^ > A _ I ^t ^ |1 K 1=^2 i }U ^ 1 ^ 1 ^ ^ -a < ^ 1 S; ^ ■S o 1 1 1 * a *. ^ 1 N 5iij . S S l.l ^ 1 = ^ 1 JE 3 S 1 ^ •^ „>„- H -^ II a ^ 1 J ^ r I i ll * 1 >^ ! tf 71 72 STOCKS, STORES, AND INVENTORIES rem Ift-P ' /^ J STOCK RECORD Low LIMIT— WCHT. 0» N — _ No. Pes Machine i-^F-J^r*!--?- . 1>ATH OlIURK No. AUT. RecD AUT Rhcd DaIO Dhld Deld Oh Hakd Date Recd AMT Recd Date Deld Dbld Om Hand Date Recd AUT KECD Date Uei.d- Amt I oil 1 Uei.d Hand I >i!^)?„ /^ -—r-j '/^r, // •7^ y*/,^ '/^/fl v ^. '/i4>, /e !>/ •A .r nf '/,^ 4^ J-J. '/„ / (~^) <^~rA .IOOpc>. 1 MONTHLY AND YEARLY INVENTORIES 73 of the year. The percentages of overhead charges will vary with the different departments and with the different periods, as reflected by the conditions in the factory. An average overhead must be taken, otherwise the value of the inventory would be higher when the factory is not working anywhere near its capacity. THE PERPETUAL INVENTORY IN PRACTICAL OPERATION BY J. B. GREEN CH has been written concerning the principles of scientific management but less regarding the details of its application. The inherent difficulty in attempting a discussion of this phase of the subject is the almost infinite variety of situations existing in different manufacturing plants, each requiring its own special treatment. The manager who is convinced that scientific management is theoretically correct and has come to the conclusion that he would like to try it is confronted with the all-important question of how to go about it. There are two general methods — to employ a professional industrial engineer, or to do it yourself. This article is ad- dressed to the manager who has selected the latter. The word "scientific" comes from a Latin root meaning "to know," and scientific management is essentially a management based on knowledge in distinction to one based on guess. The knowledge which is the basis of scientific management is ob- tained usually in two steps, and may be said to consist of original data and derived data. For example, a properly set task and bonus is the knowledge of what is a proper compensation for a given amount of work, and it is derived from data ob- tained by time study. The cost of manufacturing an article is derived from original records regarding material, labor, and overhead expense. Managers, as a rule, are at least familiar with the methods of obtaining such original records as the ac- counting department of a scientifically managed plant requires. It is essential that the plant be broadly divided into a stores department and a manufacturing department, and that no transfer of goods of any kind be made from one to the other except on a properly executed written authority. The forms usually used are known as "Stores issue cards" and "Stores 74 THE PERPETUAL INVENTORY AT WORK 75 credit slips." It is also necessary that all manufacturing be done on authority of a written factory order. The purchasing department must be so organized that all purchases are covered by a written purchase order. The receipt of all goods must be reported on a "Material received" report. This much is required as the basis for operating a "Balance-of -Stores Record." It is with the practical details of operating such a record that this article is concerned. Before passing to a discussion of the subject it is well to real- ize that all manufacturing may be divided into three classes, usually designated as contract work, job work, and standard product manufacturing. Contract work is done mostly outside of the plant, as building a bridge for example. Job work is done within the plant, but each order is made to the customer's specifications. Standard products are made within the plant to standard specifications and run to stock. The business of any single company may belong to any one of these classes, or it may be a mixture of any two or even include all three. The majority of manufacturing plants represent a mixture of job work and standard product, and it is to this class that special reference will be made. With but a few modifications, however, on some points, the discussion would apply to the other classes as well. Passing to the practical details of installing and operating a Balance-of -Stores Record, the first consideration is the clerk required to keep the record. The duties of the balance-of -stores clerk are herewith presented in specimen form and discussed by paragraphs later. BALANCE-OF-STORES CLERK's DUTIES 1. Superior Officer. In the performance of the following duties, the balance- of -stores clerk is under the direct supervision of the chief accountant and reports to him. He cooperates with those making out the original records with which he is concerned in the matter of correcting errors. 2. Divisions of the Balance-of-Stores Record. The balance-of-stores clerk keeps the record in four divisions, viz.: (1) Raw Material, (2) Semi-finished J i 1 ^!i g 1 1 ''^ . i 1 2 ^ ° 1 ^1 i i r ^ 1 i 2 1 L^ < y 1 1 i 1 s i II o 1 t 9 9 ■^^ 1 S 60 W) 'S ^ -a fl J o *J o [^ ^ '"■' P4 0) O 03 (3 V Q rt m ^•tt b -o fe o •P a i^ ^ -« d bo j^ ^-« ->j ..VI ri m a 00 i=5 >> l> -^ 3 60 3 S fl — O Tfl S .2 ^ ^ -a Jj •■P -a ^ 76 THE PERPETUAL INVENTORY AT WORK 77 Material, (3) Finished Goods, and (4) Supplies, sub- dividing these main divisions as required. 3. Original Records and Their Use. The balance-of-stores clerk receives the following forms from other departments and uses them as directed herewith : (a) Copy of Purchase Order: — After making the proper entries in the "Ordered" column of the balance- of-stores record, the copy is initialed and filed serially by order number. (b) Copy of Material -Received Report: — After mak- ing the proper entries in the "Received," "Balance," and "Available" columns of the balance-of-stores record, the copy is initialed and filed by date. (c) Stores-Credit Slip: — After making the proper entries in the "Received," "Balance," and "Available" columns of the balance-of-stores record, the slip is priced, initialed, and turned over to the stores distribution clerk. (d) Stores-Issue Card: — ^After making the proper entries in the "Issued" and "Balance" columns of the balance-of-stores record, the card is priced, initialed, and turned over to the stores distribution clerk. (e) Shipping Order: — This goes to the balance-of- stores clerk before going to the shipping department. Opposite each item regularly kept in stock he stamps "Applied," and makes an entry in the "Applied" col- umn of the balance-of-stores record. Opposite each item not kept in stock he stamps "Requisitioned," and makes out a requisition on the planning department for the goods. The shipping orders are then passed to the shipping department. (f) Copy of Factory Order: — After entering in the "Ordered" column of the balance-of-stores record, the copy is initialed and filed serially by order number. (g) Invoices for Goods Purchased : — ^Af ter entering the unit price in the "Price" column next to the "Received" column of the balance-of-stores record, the invoice is 78 STOCKS, STORES, AND INVENTORIES stamped "Bal. of Strs. Clk.," initialed, and sent to the purchasing department. 4. Use of Balance-of-Stores Sheet. The various spaces and columns are filled in as follows: (a) Heading spaces: — The unit and name are stated briefly but plainly. When a new item is added, the unit and name are obtained from the purchase order or else- where as occasion requires. The "Average Weekly Consumption" refers to the quantity sold or otherwise used per week on the average. This is revised at least once in six months, or of tener if there is a great variation in the rate of consumption. In the case of seasonable items where the average weekly consumption varies greatly during different months of the year, the proper average is specified for each season. The "Factory Time" refers to the time in weeks required to manufac- ture an item plus a factor of safety making a full allow- ance for the time required to start a run after the raw material is on hand. It is determined by the planning department. This space applies to finished and semi- finished material only. The "Classification Number" is a mnemonic symbol standing for an item of stores. This is devised by the chief accountant. It is used to index the balance-of -stores record. The "Quantity to Order" is determined by the manager of the stores de- partment. The "Minimum Stock" space is filled in as follows: — Case I; for raw material kept in stock, the minimum equals the time in weeks required to obtain a shipment from the source of supply, multiplied by the average weekly consumption. Case II; for finished goods for which raw material is specially ordered, the minimum equals the product of the average weekly con- sumption, the sum of the factory time, and the time in weeks required to obtain a shipment from the source of supply. Case III; for finished goods for which raw ma- terial is kept in stock, the minimum equals the factory time multiplied by the average weekly consumption. THE PERPETUAL INVENTORY AT WORK 79 Case IV; for supplies, the minimum equals a specified quantity determined as directed by the manager of the stores department. (b) "Ordered" Column: — The date, quantity, and order number are posted from the purchase order or fac- tory order, depending on whether the material is pur- chased from outside or made in the factory. (c) "Received" Column: — The date, quantity, and order number are posted from material-received reports or stores-credit slips, depending on whether the material is received into stock from an outside source or the fac- tory. The price is obtained from the invoice or the cost clerk, depending on the same circumstances. (d) "Issued" Column: — The date, quantity, and or- der number are posted from the issue cards. (e) "Balance on Hand" Column: — Every entry in the "Issued" column is subtracted from the last balance and the difference and date entered. The cost price is entered after every receipt of goods. If this fluctuates violently, the price is reviewed by the manager of the stores department before entry. He may assign an arbitrary average price. (f) "Applied on Orders" Column: — This column is used only in connection with finished goods. Entries are made from the Shipping Orders covering regular stock items, the date and quantity being posted. (g) "Available" Column: — Every entry in the "Applied on Orders" column is subtracted and the differ- ence and date posted. Every entry in the "Received" column is added and the sum and date posted. (h) "Remarks" Column: — This is used as the name implies. (i) Lining-up Columns: — In order to keep track readily of various related items, the double lines im- mediately following the quantity columns are lined in. Whenever an order has been received complete, the space in the "Ordered" and "Received" columns referring to this order are lined off. The same procedure is followed 80 STOCKS, STORES, AND INVENTORIES between "Issued" and "Applied on Orders" columns when the latter is kept. (j) Checking Columns: — The narrow spaces imme- diately following the double lines after the "Quantity" columns are used for checking purposes. 5. Maximum and Minimum. The balance-of-stores clerk knows that it is time to replenish stock whenever the sum of goods on order and on hand or available becomes less than the prescribed minimum. A requisition is issued for the specified quan- tity to order, and sent to the purchasing department in the case of supplies and raw material, and to the planning department in the case of semi-finished and finished goods. The above represents a statement of the balance-of-stores clerk's duties in such form as they might be issued to him by the chief accountant or other oflScer. Taking up the various sections of these duties one at a time for discussion, the first relates to the superior ofiicer. The balance-of-stores clerk is under the chief accountant's supervision, because the work is essentially accounting and is so closely related to other features of a general accounting system that it must be under the same supervision. The second section refers to the division of the record. All materials handled by a manufacturing company may be divided into four main classes : raw, semi-finished, finished, and supplies. The balance-of-stores record should have at least these divisions and further subdivisions as the nature of the business de- mands. These same divisions are usually made in storing ma- terials, in reporting an inventory, in cost accounting, and numerous other places, and should, therefore, be used in con- nection with the record so that it will harmonize. The third paragraph is concerned with original records and their use. The balance-of-stores clerk requisitions the purchas- ing department for material required and receives back a copy of the purchase order as acknowledgment and advice regarding the date ordered and the order number. This latter is useful THE PERPETUAL INVENTORY AT WORK 81 in checking the goods off against the proper order when received. The balance-of -stores clerk's copy of the purchase order is filed serially so as to form a cross index with the purchasing depart- ment's copy, which should be filed alphabetically. All original records should be initialed as soon as posted to indicate that the proper entries have been made. A copy of the "Material Re- ceived" report is essential to keep the record in balance. It is filed by date because a freight bill, or other record, may give only the date, or approximate one, on which an item of material was received and this system of filing makes it easier to locate reports. The record itself furnishes a cross index by order number or name of item. The "Stores Credit" slip is the authority to return goods to stock from the manufacturing departments. The quantity should be recorded in the "Received" column and added to the "Balance" and, in the case of finished goods, to the "Available" column. It is priced at cost and turned over to the stores dis- tribution clerk, who summarizes these and the stores-issue cards and keeps a running inventory in dollars and cents of the stock on hand. This is necessary in order to close the general books once a month so as to derive a monthly'profit-and-loss showing. The credit slips and issue cards are eventually turned over to the cost clerk, who files them permanently by order number or, if they refer to an item of overhead expense, by account symbol. The stores-issue card is handled the same as a credit slip ex- cept that it represents an issue of stock to the manufacturing departments instead of a credit. The balance-of-stores clerk receives the shipping order to requisition the planning department for items not in stock, and to keep the quantity available continuously up to date. This makes it possible to advise the sales department at any time just how much of any item is available for sales. The balance-of-stores clerk should receive a copy of the fac- tory order, for reasons similar to those given in the case of a purchase order. In one case the material is bought from an outside source, and in the other from the manufacturing de- partments. 82 STOCKS, STORES, AND INVENTORIES After an invoice for goods purchased has been paid, it should go to the balance-of -stores clerk so that he may enter the price. This should be done from the paid invoice in order to include any price adjustments. The price invariably should be reduced to the same unit as that in which the stock is recorded in the record. The paragraph concerned with the use of the balance-of -stores sheet probably requires explanation on only a few points. The "Classification Number" is essentially an abbreviation for the name of an item of stock. It may be composed of figures, letters, or a mixture of both. For a complete discussion of this subject, reference should be made to literature on the subject. These symbols serve the purpose of translating shop names to those used by the accounting department, as a basis for setting depreciation rates, as an aid in sorting the cards for posting to the record, and for resorting by the stores-distribution clerk, etc. The question of devising and using mnemonic classifica- tion symbols is a subject too broad to more than hint at here. The "Quantity to Order" and "Minimum" will be discussed later in connection with the paragraph "Maximum and Mini- mum." The "Available" and "Applied on Orders" columns may serve a variety of purposes depending on the nature of the business. Uses for these columns will readily suggest them- selves. In the above statement of the balance-of -stores clerk's duties these columns are used only in connection with finished goods, but under certain conditions they might prove of greater benefit with one or all of the other classes of material. The essential thing in operating these columns is to have all authori- ties for the issue of stock from the stores department cross the balance-of-stores clerk's desk first, be entered and stamped "applied." Unless this is done, some stock will be issued with- out being first applied on orders which will, of course, vitiate the benefits of keeping these columns. Passing to the next paragraph, the maxima and minima, and the operating of this feature is the most important part of a balance-of-stores record. When the balance on hand plus the quantity on order equals the specified minimum, more stock should be requisitioned. This minimum should be so set that THE PERPETUAL INVENTORY AT WORK 83 the fresh supply comes in just before the old stock is exhausted. In order to set such a minimum for an item of stock, it is nec- essary to examine the factors which affect the exhaustion and replenishing of stock. These are twelve in number when all possible cases are covered. However, it is rarely necessary to consider more than three or four in any particular instance. Following are the twelve factors, the unit of time being the week and the unit of quantity that one decided on as the stand- ard for the balance-of -stores record : (a) Time required by the purchasing department to place an order after receiving a purchase requisition from the balance- of -stores clerk (&) Time required by the seller to ship the goods after re- ceipt of the purchase order (c) Time required in transit (d) Time required to pass goods through the receiving room and to the desired point in the manufacturing department (e) Time required to manufacture goods (/) Time required to ship goods after being manufactured (g) Time required as a factor of safety (h) Average quantity consumed per week (i) Balance on hand (j) Quantity on order (k) Maximum quantity that a single order might require Let L = the allowable minimum quantity. Using the letters indicated above, the sum (a + & + c + c? + e+/-f^) equals the time in weeks required to secure the raw material and manufacture a lot ready for shipment. This sum multi- plied by h gives the quantity sold during the time required to replenish the stock. It might, therefore, be expected that if the balance-of-stores clerk made out a requisition on the pur- chasing department for raw material when this quantity was left on hand, the new lot would be ready just as the old lot was used up. There must, however, always be enough on hand to fill the maximum order that might be expected, so the factor k is added. It often happens that the quantity to order is small and the time required to obtain raw material is long. In such 84 STOCKS, STORES, AND INVENTORIES cases, the factor j must be subtracted. The complete general formula then becomes, and a requisition should be put through as soon as L becomes less than i. It is not necessary for the balance-of-stores clerk to figure an elaborate formula of this kind. When all of the quantities, a, b, c, d, e, f, g, h, k, remain constant, or nearly so, over a period of time such as say a year, the formula need be figured but once and the minimum specified on the record as a number. When, however, one or more of these quantities varies enough to warrant the extra work on the part of the balance-of-stores clerk, the formula should be specified on the record, using words instead of letters as very few clerks will readily comprehend the significance of algebraic symbols. Referring back to the specimen duties of the balance-of-stores clerk, paragraph 4, Case I, the quantity b is regarded as varying so that it must be considered. This would be true for instance in case bar steel were the raw material. This sometimes may be had from the mills in two weeks and sometimes it requires six months. It is obvious that it would be foolish always to keep six months' supply on hand and yet the supply must come in regularly. This is accomplished by having the purchasing department make monthly or semi-monthly reports to the balance-of-stores clerk regarding the time it takes to get deliv- ery. The purchasing department is instructed to add a factor of safety which shall cover the quantities a and c as well as g. The balance-of-stores clerk should periodically compute h on all items and make such corrections as are required. The quan- tity Jc so far as these specimen duties are concerned is considered very small and may therefore be neglected. The quantity j does not often enter into the calculation, and when it does is considered by specifying that a requisition should be put through when the sum of the goods on hand and on order be- comes less than the prescribed minimum. It will thus be seen that this apparently complicated formula has resolved itself for the case in point into a consideration of but two quantities. After the balance-of-stores clerk has figured a few items by this THE PERPETUAL INVENTORY AT WORK 85 method, he can usually tell at a glance whether a requisition should be put through. The person setting the minima should make himself very familiar with the theoretical formula as given above and should reduce this to simple terms covering specific cases which may be practically apphed by the balance-of-stores clerk. The case given is but an example. There are probably several hundred different ways in which this formula may be reduced for practical application. By its intelligent use, how- ever, it is possible to keep but a relatively small amount of stock on hand and at the same time always be sure of an adequate supply. The maximum is, of course, the sum of the minimum quantity and the quantity to order. The quantity to order is dependent on five factors. These are as follows : P = Average weekly consumption. Q = Set-up cost plus loss of profit, if any, due to idleness of machine. R = Shop cost (except preceding item) per unit. S = Rate of interest plus rate of depreciation, both per week. T = Storage charges per unit per week. Then let X = Quantity to order. It is evident that it costs as much to get ready to make a run of goods if only one piece is made as if a thousand, or ten thou- sand, or whatever quantity can be turned out without resetting a die or making other changes. Consequently, the more goods that can be manufactured in one lot, the lower will be the cost. Suppose, however, as is usually the case, that these goods must be stored in the warehouse for some time until sold. There is an expense occasioned for warehouse space; money is tied up, the interest on which should be charged against the goods, and there is usually a loss through depreciation. Thus, so far as storing the goods is concerned, the more made at a time, the higher the cost. Here are two forces, so to speak, pulling in op- posite directions. There must, therefore, be some point where the cost is a minimum. If the quantity run be smaller than this amount, the increase cost per unit due to distributing the set-up charges over fewer pieces, more than offsets the reduction in cost of warehousing. On the other hand, if the quantity run be 86 STOCKS, STORES, AND INVENTORIES greater than this minimum, the warehouse expense more than offsets the saving in manufacturing cost. That branch of mathe- matics known as calculus makes it possible to determine the formula which expresses the proper quantity to order so that the sum of the manufacturing and warehouse expenses shall be a minimum. Expressed algebraically this formula is RS + T Thus, to find out the proper quantity to order in any particu- lar case, it is merely necessary to substitute the figures applying and solve the problem by ordinary arithmetic. No knowledge of either calculus or algebra is required to use this formula. Great care, however, should be taken in getting the units cor- rect. The same unit of quantity must be used for P, R, S, and T. Costs must be written as dollars and decimal parts of a dollar. For instance, if the shop cost is 6 xV cents per unit, it must be written $.062. If the proper care is taken regarding the units of quantity and money, it is a comparatively simple matter to figure the right-size run to make on each item so as to give the maximum economy. This formula will be found of greatest service in connection with expensive, bulky, perishable goods, with a high set-up charge, and of least service when the reverse is the case. There are certain necessary adjuncts to the successful opera- tion of a balance-of-stores record, the details of which have not been given in the preceding paragraphs. A perpetual inventory to be of value should reflect the actual quantity of stock on hand, at least within 1 or 2 per cent, on the average. If no mistakes were made the record would, of course, be accurate. Mistakes are made, however, and with the exception of a few commoner ones which are easily recognized and corrected, most of them are due to an almost infinite variety of causes. On this account, it is usually cheaper to correct the mistakes after they have been made than to prevent their occurrence. Experience has shown that it is essential to have a tag or other form on each item of stock in the warehouse, and on this tag keep a running balance of stock on hand. So far as this balance is con- THE PERPETUAL INVENTORY AT WORK 87 cerned, it should be an exact duplication of the balance-of -stores record. Unless the men handling the stock are unusually in- telligent, the tag balance should be written on every issue card and credit slip. This enables the balance-of-stores clerk to keep his books in accord with the tag. The stock men should be instructed to size up the quantity of an item on hand every time an issue is made to see if it appears to agree with the tag balance. If there is a visible discrepancy, a correction should be made at once by notifying the balance-of-stores clerk. There are other errors which creep in and which are too small to be detected by this method. These are corrected usually in one of two ways often called the "Double-Bin" system and the "Item-a-Day" system. The former depends on having two bins or spaces or other means of keeping each lot of material of each item separate. A tag is kept on each lot and the old lot completely exhausted before beginning to use the new. In this way every time a lot is drawn down to zero the tag should show a zero balance which is an excellent periodic check. This sys- tem also insures getting rid of the oldest stock first which is often very desirable. The other system is based on the fact that most stock men are rushed during the morning hours but usually have httle work later in the day. By arranging to have them count a number of items each day during their slack time, the entire stock can be systematically and continuously inventoried. The number of items counted a day should be such that a com- plete round will be made about once in six months. Before closing, it might be well to call attention to the fact that there is just one reason for maintaining a balance-of-stores record, and that is to make more money. The manager, there- fore, who is instalhng or operating such a record should have clearly in mind at least a few of the ways in which this is a source of benefit so that, when questions of policy regarding the record arise, he will be able to form a sound judgment as to the most profitable course of action. The balance-of-stores record con- stitutes a history in detail of the movement of every item of stock and, by reference to it, many otherwise perplexing ques- tions regarding requirements may be easily answered. The record is often the means of detecting theft. It is also indis- 88 STOCKS, STORES, AND INVENTORIES pensable to monthly profit-and-loss accounting. It is a handy source of information for the sales department when a customer telephones to ask if so much of a certain item is in stock. The record may be made to show at a glance how much is available for sale. The regulative feature of running stock to maximum and minimum is by far the most profitable. A large stock of merchandise ties up valuable capital, not only in the stock itself but in the storage space required. Too small a stock means idle machines and poor service to customers, both very ex- pensive. The warehouse acts like the flywheel of an engine. It stores the excess stock when it comes in faster than required and lets it out when required faster than it comes in. If the supply and demand could be made to correspond exactly no warehouse would be needed. The Perpetual Inventory permits reducing the size of the warehouse flywheel usually from a fourth to a half, and may rightfully be termed a very valuable part of Sci- entific Management. STANDARD PRACTICE FOR PURCHASING AND STORES DEPARTMENTS BY DWIGHT T. FARNHAM IN THE calm days whicli preceded the great war Mr. Adam T. Wadleigh was a most methodical man. Every Saturday afternoon he invariably outstayed the other clerks by ex- actly one hour, in order to avoid impairing the reputation for conscientiousness which he had established during 23 years' service with "his firm." From the oflSce he always went to Harrigan's Smoke Shop and purchased from Ed Harrigan him- self a box of 25 Robert Q. Child's guaranteed cigars. These cigars which he knew were honestly made of innocuous tobacco and which he candidly convinced himself, by inquiry elsewhere, could be purchased as cheaply at Harrigan's as anywhere, he paid for in cash and bore away to his "bachelor apartments," located on the third floor of Mrs. Drusilla Hooker's exclusive boarding house. Upon arrival at his lair he locked his perfectos away in an ancient humidor. During the next seven days, after each meal, he abstracted one cigar which he lit at the grate or the gas jet and smoked to the bitter end, with the aid of a weichsel holder and a bent pin. Inasmuch as he allowed himself double rations on Sunday and, "unless a friend dropped in," presented the janitor at the office with a cigar on Saturday, he smoked his last cigar about an hour before he again repaired to the aforemen- tioned Mr. Harrigan's for his weekly purchase. This procedure multiplied by 52 represented Adam T.'s annual dissipation in its entirety. Although such was by no means his intention Mr. Wadleigh inadvertently furnishes us, gratis, with the perfect example of material purchase, control, and conservation, because: 1. The material required was in stock and readily accessible when needed. 89 90 STOCKS, STORES, AND INVENTORIES 2. When the stock needed replacement the order was placed promptly and in such a way as to preclude misunder- standing. 3. All purchases were duly authorized. 4. The material was bought from a reliable firm which could be depended upon : (a) To have a stock on hand. (b) To make immediate delivery. (c) To maintain quality. 5. The material was bought at the lowest price consistent with dependability, 6. Delivery was made safely and quickly. 7. The goods were economically stored and in such a man- ner that: (a) They could be withdrawn from storage with the least expenditure of labor. (b) They could be withdrawn without delay in locating or in transporting to point of use. (c) They were in no danger of deterioration. (d) They were not likely to be destroyed or stolen. 8. The store's layout was such that any unusual with- drawal from stores would be evident at once — making local demand without local supply impossible. 9. Demand had been standardized. 10. The most efficient lot had been determined taking into consideration economy of purchase, conservation in storage, cost of storing and transporting, and the like. 11. Transportation was effected most quickly, most eco- nomically, and in the surest manner. 12. Advantage was taken of all discounts. Postage, clerical and stenographic work was reduced to a minimum, as was also the demand upon the time of purchaser and of vendor. 13. The chance of error was reduced to a minimum. 14. Credit risk was avoided. 15. System and red tape was reduced to the vanishing point. 16. The material was used for the purpose for which it was PURCHASING AND STORES PRACTICE 91 intended and there were no wastage of material and no scrap. 17. Quality and quantity per unit purchased were such that in its use the least amount of clerical labor was required and the least amount of auxiliary labor and supplies consumed. 18. Costs were predetermined and operation was always 100 per cent, efficient. The only difference then between the simple common-sense purchase of the individual, as illustrated by Mr. Wadleigh's weekly peregrination, and that of the hundred-million-dollar corporation is one of elaboration. In each case the principles are the same. That practical economist — be he industrial en- gineer or executive — who is personally responsible for the effi- ciency of operation of a great concern must convince himself that the elaboration is just sufficient, that the system is "tight" but that it contains not one more form or one more counter check than is absolutely necessary. Otherwise the purchase, stores, and material conservation system is faiHng to earn its full dividend. Just how much elaboration is necessary in installing an eco- nomical purchase and stores system depends upon the type and size of the business. While the principles do not vary, local conditions vary greatly and trade customs in each line of busi- ness differ widely so that certain concessions usually have to be made to suit each case. Furthermore, each purchasing agent and each auditor has certain pet methods which he will fight for as a mother for her first-born — regardless of real beauty or of usefulness. All this must be taken into consideration when installing purchase and stores control mechanisms. Knowing all this, it requires courage to pass from the safe generalizations of stated principles to the exposed position of standard practice instructions. Nevertheless, I believe that the clarity of later statements will be increased by the reproduction of condensed instructions suitable for controlling the disburse- ment and purchase of supplies in a plant requiring the con- tinuous maintenance of a stock amounting to, say, something over $150,000. 92 STOCKS, STORES, AND INVENTORIES STANDARD PRACTICE INSTRUCTIONS Stores and purchase procedure. 1. An employee requiring material from stores makes out stock requisition (Figure 1) which upon presentation, signed Form r>U. lOU U-} STOCK REQUISITION , ^f . OEPT. NO...i> ACCOUNT NO..L -.©.'•..4., DATE...3.r..<0.-'- - 191©- EXPENSE ORDER..iS:3J!L^_ QOANTmr DESCRIPTION AMOUNT 1 ia 1 P^,^P,PT'"" /Vfy^<=/^//i^£ I nnnPB im i rvr^ ORDERED RECEIVED WITHDRAWAL BALANCE 1 Dili , ffft Rca. NO. aUANTITY Dill Rea. NO. QUANTITY llel Ptiu Diilmid PER Dill ilWbu OUANTTT IN DaU QUAIfTITV / ^/ /jd'oc \/'ec ■^c /J(f'ct. 'J'eo ~1? /i <: "/^ '4"^- , /^^^ ^ ' ^^>^ / iff'^o. /"<= .05^ /Jto ^r /■iiocc \/'eo -r,^ /■i^ec yT'cO f /•r !f EXPENSE ORDER ^5UT^l'A--s>'^"it-^ ..fit^> -4>jR>U..w. .. >o V^' (?.w4; ^^ C \^ e^^- To "^^al^t^t^^ r POMT M TMi Asovc la Her cleam. tak* n ■ «..-^.»g.«>4^ Fig. 3. Requisition Slip Pkopeely Filled Out (Figure 4) in tripHcate, stating whether it is for stock or im- mediate use, where it is to be dehvered and by what date; also for what material is to be used, and where. Quantity and rM>|r .PURCHASE REQUIsmON R«. 3649*'] PUHCHASINO department: o.» «^^JL V- v-ft 1 Order Item. k^1n« fnr fj 8'"^^ \ .» ^Oe?. -• 7fV"°^--^s4y^^ UIXiuKlbr (W>1^ S^'i— — '< 1 7. i ...TO HOOIBO &A.^ Sidre. Kj aUANTlTY AMD OESCRIPTtON «.,. «iv.™ PM PHica PM rnrca' »tH yTrr^ i\^.iJ]..^ T> Iffrm ^n''* \\ tl** M 'if^T^- tt ' JUjijJ_ ■ . . .y~\ . « ^ P.O.*. . J pji^i-dr (.^ 1^ fU" .o-.K-'ll;'^ TMHS Op^Z. fc*" _«. \-->.-T Dtuvmr ,' ■V.O T*» — ^"^ \\y'-'^ — t^ ■'■ APPROVEO; ^^\^ -w^f y.i. V,« BKCeiveD < —Jda- 1 . 1 . 1 . 1 -1 . 1 . 1 . 1 . 1 . 1 ., 1 .. 1 « 1 u 1 „ I „i « u.i „pf„ 1 i u 1 »f *i . i.i „ 1.,1-uiij Fig. 4. Purchase Requisition Form for Material Not in Stock complete description should be given, as well as a statement of stock on hand, and a record made as to the last date and quan- tity of material ordered. No such purchase requisition, except PURCHASING AND STORES PRACTICE 95 for stores, will be honored unless the expense order and account number are noted thereon. The third copy remains in the requisition book of the employee. 8. The requisition is then signed; original and blue duplicate are detached from the requisition book, fastened together with vise clips, forwarded to the department head for approval, and sent direct to the purchasing department. 9. Bids or quotations on material are then secured from at least three firms found on the reliable list and the prices are entered on both copies of the purchase requisition, the firm from whom the goods are ordered being marked with a check. PURCHAS1N6 DEPARTMENT ■ IMPERIAL MANUFACTURIN6 CO. , , j tn maWnJ Vill plWM rtftr -to Orriir Wo . J7*?... . Requisi-tw Ho. J*f'*S— . CatM J ^'u ' . ^^_^_^ Brffr m, Smith ^ 5hipl9ij ■AtJArt.*^ SJO Custom Houst Sfrvat ■ , „ , , ??.9.L?jy2S^.'rPS 5ubJ«At to eondltlonxMfrinttd m ntrst htr Pi-.<:«» F 6. Your- factvnj iir,!iicK,xcoMrmxi>rrjHKCiinc!> cim WflW- l1AI«irAcrailN6 COBPANY K lisua Far afn t Ba '-/ Cnrrt ' Fig. 5, Pubchase Order, Made out en Duplicate 10. All purchase requisitions must be O. K.'d by the purchas- ing agent and all expenditures amounting to more than $500, except certain material listed as routine purchase, must be O. K.'d by the management. 11. The purchase order (Figure 5) is then made out in du- plicate. The original is sent to the successful bidder and the duplicate to the Unfilled Order File where it is attached to the original Purchase Requisition and followed up on the date indi- 9Q STOCKS, STORES, AND INVENTORIES cated by the red flag . Unsuccessful bidders are notified in case the order is a large one. 12. The blue duplicate of purchase requisition is forwarded by the purchase department to the general storekeeper and handled as indicated in paragraph 17, below. 13. In order to avoid incurring expense for rehandling goods so heavy that they are unlikely to be stolen, all such supplies should be delivered at the point of use but should be ac- RECFTVFD OF rm r„ , .. ,, ■ OUANTITY DESCRIPTION ■ Date Via , Ry . .. Approved: 'NOTE7 SupC When dra; tickets do Dot accompany deliveries, use this form to ootUy PurcItasinB Department ol materrals received. FIG. 6. Dkay Sup Giving Purchase Requisition NUMBEK companied by a dray slip furnishing information as to where they are to be delivered and should go to such destination via the storekeeper. 14. During this call at the storeroom a record should be made upon stores card as heretofore described if the supply is to be physically handled through stores, or in the receiving book if delivery is to be made direct to a special job, as described in paragraph 13. 15. When the dray ticket does not list the contents of the PURCHASING AND STORES PRACTICE 97 « package or load, the number of the purchase requisition listing such contents must be entered on the dray slip (Figure 6) or the contents must be indicated in some other way with sufficient clearness to allow the bill to be checked at the main office. The dray slip must be signed by storekeeper. In the case of carload shipments the same procedure will be followed. 16. As dray tickets are received by the purchasing depart- ment, they are checked against the original requisition ; material indicated as being received is noted on the requisition and in- voices are O. K.'d for payment and turned over to the account- ing department to be vouchered. As a general thing invoices should be ffied in the discount tickler until due, when the voucher should be mailed. 17. In order that those who have ordered supplies may be notified at once upon their arrival, the blue duplicate (see para- graph 8 above) should be sent to the storeroom as soon as goods are ordered, and held there until the material arrives at the storeroom when the blue slip should be sent to the originator or person who signed the purchase requisition (indicated by initials on the blue slip) who will thereupon requisition the goods from the storeroom by means of a stock requisition, as described in paragraph 1 above. 18. In cases where the supply is to go direct to the job, the blue slip should go to the storekeeper as above. On arrival of the supply in this case, however, the storekeeper must send with the blue slip a stock requisition made out in duplicate, the car- bon of which he retains for follow-up purposes, to the originator of the order. As soon as the originator is so notified that the goods have arrived he must sign the stock requisition and re- turn it to the storeroom at once, thereby indicating that he is satisfied with the quality and quantity of what has been de- livered and certifying as to the correctness of the distribution indicated by the expense order, account number, and description, copied to the stock requisition from purchase requisition which is filled in by originator or by the purchasing department. 19. Upon the return of the stock requisition the storekeeper prices it, enters the value of the supplies upon the material dis- tribution sheet opposite its proper expense-order number, and 98 STOCKS, STORES, AND INVENTORIES sends it to the cost department with other stock requisitions the first of each month. INVENTORY VALUE OF STORES The question of the inventory value of stores boils down in the end to an estimate of forced liquidation value. Theoreti- cally, anything stored is worth the market price. Actually it is worth what you can get for it, which varies directly as the time allowed by your creditors, less the discount always expected by buyers of bankrupt stock. It is well for the management to insist on conservative inventory values lest the profits which the purchasing agent or storekeeper point to with pride on a rising market later bite large holes in the net profits when the market price falls. At such times stockholders are crotchety anyway and conservative management will so arrange its affairs that no more excuses than are absolutely necessary have to be made when the time for passing dividends arrives. One company I knew of inventoried all stock at the market value when the market was rising and at the time of the annual physical inventory counted all stock that was missing as present as well as all stock unexpectedly found. I have never been able to ascertain in detail the result of this supreme example of opti- mism, but I would not like to be manager of that company when the day of reckoning comes. It would have been much safer for all concerned if the safe and sane self-adjusting plan of charging all goods into stores at cost had been adopted, since you cannot get away from the fact that cost is what you paid for them. No more can you escape the logic of charging all goods removed from stores into manufacturing at cost, since the cost of production is really composed of the cost of the vari- ous figures entering into production. Then if the market rises it is easy enough to maintain profits by raising the selling price of the finished product to cover the rise in the cost of material. Incidentally, it is usually safe to assume that the man who pro- poses to follow the market in valuing his supplies has never attempted to reprice some thousands of stock cards every time the market changes. If the market falls seriously and consid- erably, conservative practice may force the repricing of ma- PURCHASING AND STORES PRACTICE 99 terials in certain cases. I am inclined to think, however, in such an event, that it is better business economics to face the fact that your costs are high and to write off your loss as lack of net profits than to write off inventory value. The same policy we have outlined has also come to be the accepted practice in pricing manufactured stock used for repairs, construction, and the like. Formerly optimistic managers charged such stock in at the selling price instead of at the cost of production, adding the profit to their net profits. Although there is a long and wordy defense of this practice, it is impossible to get away from the fact that the firm that does so inflates its profits — a practice that tends to encourage unwise expenditure and also inflates its capital account — thereby increasing the investment upon which dividends must be paid and also the probable discount on marketable assets in case of liquidation. The inflation of profits is always dangerous, and unearned in- crement should be added to the plus side of the balance sheet only after the most searching examination. In the long run the " something-f or-nothing " schemes are just as futile in business as "perpetual-motion" schemes are in mechanics. There seems to be a sort of economic conserva- tion of energy law about inflated values that provides sooner or later for a period of reckoning, and the popularity of stock- waterers is decreasing in inverse ratio to the increase in the num- ber of widows and orphans who are gradually disclosed as hold- ing the bag, as various inflated corporations are forced to com- pete on the basis of merit and are brought forth in their true light under government scrutiny. Some firms add another column to their stores-record card in which they carry the daily balance on hand in money as well as in units. This plan makes it possible to ascertain the total value of stores on hand at any time by totalling the last figures on each card. Such an arrangement involves considerable extra figuring whenever stores are withdrawn and is only justi- fied in special cases, although it facilitates the compilation of the monthly inventory valuation totals. Where reservations are heavy and frequently changed, some more elaborate system than that shown in paragraph 3 of the 100 STOCKS, STORES, AND INVENTORIES standard practice instructions is necessary. The method given is sufficient for the usual spare-part and repair-material stores system described. Not very long ago I read a prolonged discussion of the rela- tive merits of physical inventories taken periodically and of perpetual inventories in which the balance is taken at will from the stores cards. In this article the inaccuracies of actual count made under pressure were contrasted with the inaccuracies of accumulated accounting errors on the cards. The horrors of "actual-count" inventories, during which the "whole works" shuts down and nerve-racked clerks count hectically all night while customers clamor and operatives secure jobs elsewhere, were graphically described. Any one who has experienced one of these feverish interludes will sympathize with the author who obviously spoke from the heart. Not so long ago I wit- nessed such a Marathon which began with colored gentlemen counting bolts under the supervision of silk-shirted salesmen and ended with near nervous prostration for the auditor with the "actual count" inventory something over 12 per cent, at varia- tion with the "book count." Fortunately such spasms have been entirely unnecessary since the introduction of the physical- perpetual inventory. This method is described in paragraph 4 of the standard instructions. Under it the storekeepers every morning select a hundred or so articles of which the stock is visibly low or which is for the most part in unbroken packages or otherwise arranged in units making quick counting easy. They make actual count of such articles and enter the result in red ink on the stores cards, thereby wiping out any errors which have accumulated. By doing this systematically every article in stores can be counted once a month, or once in three months, or as often as experience with local conditions makes the auditor feel is necessary. The physical inventory is continuous and disturbs nothing instead of being occasional and cataclysmic. At the end of the period everything has been counted and all the advantages of both systems have been obtained with a minimum of their defects. The plan is so simple that it is remarkable that it is not in more general use, involving as it does only the principle in use PURCHASING AND STORES PRACTICE 101 in the Overland Limited which takes water at full speed and changes diners and stoked engines at division points instead of emulating those early trains which ran only in the day time and stopped for meals. As in railroading, auditing under the Physi- cal-Perpetual System is done while all is in motion, and the traveling auditor drops in unexpectedly but regularly and checks stock cards selected at random against the material in the rack and the supplies in the bins. We have outgrown periodic traveling, why continue periodic inventorying.^* The matter of keeping the management informed daily as to the value of supply and material disbursements is exceedingly important. For some reason managers are accustomed to keeping in close touch with expenditures for labor, but in the majority of cases they seem long since to have despaired of being able to discover the value of material and supplies used until from four to seven weeks after the material is used, wasted, or stolen. Some quite large firms still wait until "their bills are all in " before figuring what has been expended. Inherited cus- toms die hard and the American tradition has been to have the least intelligent clerk buy the labor while the proprietor per- sonally watches the payroll, and to buy the material in person and leave the accounting thereof for casual inspection in the far future when the story can have but little historical interest. What is the use of going out and consulting with Bill or Hank about the waste of oil in their departments six weeks after the peak charge was incurred .f* Why should Pete or Hank try to be economical if the "old man " does not know how much oil should be used.'^ How can the old man know how much should be used if he is not informed day by day how much has been used with satisfactory results.? Apply the same sort of questions to almost any indirect material and the necessity of having data which makes it necessary for the statistical department to tabu- late by periods, and for the industrial engineering department to investigate with the facts at their command, will be evident. The use of expense orders is too general to require explana- tion. They prevent conflicting orders to repair departments, replace priority due to "pull" and to "influence" by priority in accordance with the plant's most urgent needs, provide for 102 STOCKS, STORES, AND INVENTORIES due authorization, and permit the scheduKng and layout of re- pair jobs so that they may be done in the most economical manner. They ensure the charge of all labor and material to the proper account and, by means of the daily -labor and ma- terial-distribution sheets, make it possible for the management to ascertain each day just how much has been spent on any repair or construction job to date. Paragraph 7 might easily give rise to lengthy discussion of methods of preparing and filing specifications,* of methods of filing catalogs and the like. Those who have had experience in purchasing know that the education of foremen and store- keepers to the writing of clear and complete requisitions is a long and tedious job. Methods used must depend upon the teachableness of the pupils. As a general rule the greater the centralization the fewer the difficulties since it is generally easier and cheaper to educate thoroughly a few storekeepers and pay them enough to hold them, than it is to install elaborate card indexes of specifications complete enough to force the lowest grade of intelligence to write specifications worthy of the American Society for Testing Materials. Purchase requisition books when in the hands of the trained few are usually produc- tive of less expense and less trouble than when widely distributed through some mistaken idea that steps saved low-priced men net the company more than the time wasted in long phone con- versations in which high-priced purchasing agents frantically strive to induce some embarrassed repair man to disclose the secret of the bore and face of the pulley desired, as well as the diameter. The determination of the standard maximum and minimum stock is a matter which should not be neglected. A printing concern not long ago was saved over $10,000 by such a deter- mination by an engineer whom I know. The work of standard- izing the stock had just been completed when notice of a con- templated rise in the price of paper was received, and the con- cern knowing its requirements with reasonable certainty was able to order a year's supply. The stock cards themselves after a few months contain sufficient data to make it fairly evi- dent how long is required to secure a new stock under normal PURCHASING AND STORES PRACTICE 103 conditions. The greater the period covered by the record the more certain and valuable the information that careful analysis will bring forth. It is well, if purchases are large, to have a place on the stock cards for the various lots on which special discount may be obtained. This makes it possible to buy more cheaply when an order is of such magnitude that the addition of a few units will bring the order within the next discount area. The actual purchase of the material is a matter of strategy and psychology. The strategy consists in careful and syste- matic preparation for the attack. The psychology is the comple- ment of the psychology of salesmanship, concerning which whole libraries have been written. By this I do not mean that because a salesman is professionally a pleasant fellow, a pur- chasing agent must necessarily be a crab. He has quite as much need for wide acquaintance and warm friends as the salesman, and will be very shortsighted if he allows his knowl- edge of sales methods to destroy his humanitarian outlook and to convert him to that cheap cynicism which delights in the discomfiture of those whose livelihood depends upon his favor. The strategy of purchase varies with the business and with the ability of those who direct the business. Some fourteen years ago when I was trying to get some of the final departments of a factory in the Alleghanies to synchronize with the rest of the plant, the officer of the company who did the purchasing phoned me during dinner to be ready to go to Buffalo in an hour. All that night our touring car roared and careened through the fog. At 7 A. M. he walked into the largest junk shop in Buffalo: '* Gimme a lO-horsepower D. C. motor. Put it in the tonneau." All that day we climbed and skirted mountain streams and all that night the faithful Jake tinkered with bear- ings and counter-shafts. The second morning our machinery was in operation. That is one sort of purchasing. The confirmation of orders in writing has been discarded by certain firms and in certain sections of the country. To my mind this is a doubtful economy except in cases where there is little chance of misunderstanding in regard to sort and quality and where the producer is so situated that he can force the re- 104 STOCKS, STORES, AND INVENTORIES placement of unsatisfactory materials without cost to his firm. It will be noted that the purchase requisition has figures repre- senting the days of the month printed across the bottom. This allows a red flag tab to be attached at the date delivery of the material is promised. When the original purchase requisition is filed in the unfilled-order file it is placed bottom side up and face to the wall for the sake of easy reading, thereby making it possible to sight down the drawer each day of the month and to pick out all requisitions flagged for that day and to ascertain if delivery has been made, and if not, why not. Under excessive market demand the follow up may become the largest duty of the purchasing department. During the past few years conditions in the automobile business were such that each firm in Detroit kept a force of stock chasers and in- spectors in every factory from which parts were bought. The disorder and bickering which resulted in having a crew of this sort in each factory, fighting with each other and with the super- intendent whenever they felt that a rival was being favored, are better imagined than described. Only a short time ago even worse conditions prevailed in firms running on war orders for several branches of the service. The remedy is of course careful and relentless scheduling with an occasional heart-to-heart talk between the heads of the purchasing and selling concerns when inspectors become over-zealous. The paragraphs covering the avoidance of rehandling simply provide for the extension of the stores system to cover deliveries which cannot be made at the storeroom without involving the useless expenditure of labor. It is assumed that the storekeeper is either competent to pass upon the quality of all material which is stored, to be disbursed piecemeal, or sufiiciently in- telligent to obtain expert inspection and approval when it is required. The system arranges for the inspection and approval of supplies delivered direct to the job in paragraph 18 of the standard practice instructions. There is no standard purchasing system which can be guaran- teed to meet the needs of every business. A system which is logical and which contains a minimum of opportunities for error PURCHASING AND STORES PRACTICE 105 and for dishonesty can in every case be worked out with com- paratively few forms and with but Httle reduphcation of work if the principles illustrated by the simple performance of Mr. Wadleigh are kept firmly in mind and if the value to the manage- ment of adequate, accurate, immediate records is realized to the fullest extent. TIME-STUDY Time-Study as Basis of Production Six Fundamentals of Time-Study Improvements in Time-Study Methods Time-Study in Small-Part Manufacture How to Make Group Time-Studies TIME-STUDY AS BASIS OF PRODUCTION BY J. A. BENNIE MAXIMUM production is the aim of all our industries to-day, and greater efforts are being made to gain this end than were ever made in the past. Many different systems of production have been devised and are being tried out. These differ to quite a considerable extent in many details, but on the one fundamental they all agree; that is, that the quantity of finished product that should be produced per man in a given time must be established. It is the general practice in most factories to analyze the finished product into its constituent piece parts, these into the several operations that must be per- formed upon each, then to determine the amount of time that should be spent for each operation in terms of man hours, and fix this time as the standard for the particular operation. These standards are a valuable asset to the manufacturer, provided they are accurate measurements of the time that should be taken on a particular piece of work. First, they provide the employer with a means of paying the men according to their respective values to him, which method of pajonent, if used judiciously, is generally accepted by both employer and employee to be the fairest method of wage payment. Secondly, standards enable the manufacturer to establish and maintain a balanced factory, however the products vary. In order that a factory may function as a unit it is necessary that it be balanced in all its parts. If there is one section whose capacity is less than that of the rest of the factory, maximum production cannot be maintained For, as a chain is no stronger than its weakest link, so is a factory no stronger than its weakest department. \^Tien standards are once set up the manufacturer can pick out these weak departments and set out to strengthen them. 109 110 TIME-STUDY To make this last point clear, we will consider as an example a factory consisting of a foundry, machine shop, and assembly shop. If, after the standard times of all operations have been determined upon, a summation shows that 1,600 man-hours are required per day in the foundry to meet the production re- quirements already decided upon, 4,800 man-hours are required in the machine shop and 1,600 man-hours in the assembly shop. If the product of the men times the hours to be worked in the foundry and the assembly shop show 1,600 man-hours available in each, while the machine shop shows only 3,800 available man- hours, then it is clearly seen that the machine shop is weak, while the other two shops are of the proper strength The manu- facturer immediately sets to work to strengthen his machine shop. In a similar manner he finds the comparative strengths of the various departments in each shop and sees that they are all of the proper strength to produce the work planned upon. Thirdly, standards enable the manufacturer to plan his work in process. Since he knows the time required to complete a certain number of parts, he is able to decide upon the time at which they should start through the shop, and the time at which they should proceed at any stage in their course of manufacture, so that they arrive as finished parts at the definite time already planned upon. By planning ahead in this manner, he is able to avoid the confusion and loss of efficieijcy that must inevitably arise unless some such system is adopted. METHOD OF DETERMINING STANDARDS Now that the value of standards to the manufacturer has been pointed out, it is evident that these standards should be arrived at by the most scientific method available. There are two methods of determining standards in common practice. By the one, standards are set from records of past performances, and by the other, they are set by some method of time-study. It is easily evident that the method of setting standard times from a record of past performances at the best is unsatisfactory. In the first place, it is a diflBcult matter to get records that are reliable, for when workmen are working on daywork they are TIME-STUDY AS BASIS OF PRODUCTION 111 not particular about having their job tickets punched at the beginning and at the end of an operation. Unless he is watched with the purpose in view of getting a correct record, the workman will invariably overlap his jobs. Sometimes he will even do two jobs on one ticket. This latter occurs in prac- tically all cases when someone brings him a repair job or a spe- cial job to do. He will in very few cases consider it worth while to punch out on the job he is working on and get a new card on the repair or special job. So we find in most shops that the amount of time spent on a job as shown on past records is a very inaccurate measurement of the time actually spent on the job. Then again, assuming that we have a correct record of past performances, standard times based upon such a record are unfair. In all factories we find good workmen and poor work- men. The good workman takes an interest in his work, takes pride in mastering his task, and turns out a good day's work every day. The poor workman is probably indifferent to his work, or perhaps he has never been properly instructed how to get out the maximum amount of work per day. Now if the record of the past performances in each case is to be used as a basis for setting up standards, the standards will certainly be unfair. The poor workman, by getting busy and learning his job and applying himself, will be able to double his production and hence his pay, while the good workman will not be able to earn very much, if any, more money, since he has always pro- duced a good day's work. In a sense we are rewarding the poor workman for his inability and indifference in the past, and penalizing the good workman for his ability and faithfulness, which is undeniably wrong. The second method of setting up standards, that of time- study, has been generally adopted. Since the results obtained by the time-study man are so important, and have such far- reaching effects, it is clear that the manufacturer cannot be too careful in choosing his time-study men. QUALIFICATION OF A TIME-STUDY MAN What are some of the qualifications the time-study man should have? First of all, he must win the confidence of the 112 TIME-STUDY man whose work he is studying. In order to win the man's confidence he must be big enough to have confidence in the man. The workman feels this confidence and at once becomes in- terested in what the time-study man has to say. He becomes keen about cooperating with the time-study man to find out what they can both work out together. They are both engi- neers keenly interested in a scientific problem, to find out the most scientific method of doing the job, and to find out the minimum time that it can be done in. They experiment. They try out different tools — if it is a machine operation. They try different speeds, feeds, and depths of cuts, sometimes the time- study man suggesting, and sometimes the operator. The oper- ator cooperates fully, as he has confidence in the time-study man. He knows that the time-study man is too broad-minded to get all he can out of the operator, and then set his standard so high that the operator has to exert himself considerably more after the standard is set without getting equivalent remunera- tion for the extra efforts put forth. He knows that in the future he will get a reward in excess of the extra efforts put forth. The company can well afford it, as together they have perhaps dou- bled the output. The man who can thus win the confidence of the workman must have personality. The time-study man of the first calibre is an enthusiast and is able to rouse enthusiasm in the workman. His far-reaching knowledge of human nature enables him to understand the workman's viewpoint. He appreciates the skill and knowledge of the workman and makes a great deal of the phase of the study that is developed by the workman, minimiz- ing what he has suggested himself. He does not endeavor to impress the workman with his wonderful knowledge and ability, but rather strives to get the workman to talk. He is a psychol- ogist and makes use of the fact that the normal person likes to express himself. When he goes into a shop to set standards, he visits with the men, and makes a few studies and turns over the time-studies to them afterward. The men see he is square and they all wish their job to be studied. He is very much in demand. He then explains to the men how anxious he is to "fix them all up," but that each man can help him by studying TIME-STUDY AS BASIS OF PRODUCTION 113 his own job first. Then when he comes to a job, later on, the workman gets quite enthusiastic, telHng him what he has de- veloped. The time-study is three fourths done before the time- study man comes to it. In some cases there is very little to do except take a few observations. ANALYZING DESIGN AND METHODS In addition to having personality, the time-study man must be an engineer with a keen analytical mind. The broader the experience he has had in manufacturing, the more valuable he is as a time-study man. There is nothing like time-study to bring out the weak points in the design of a part. It is an im- portant phase of the time-study man's work to analyze the part as to its design, to decide whether or not the design could be changed in some way to allow for its being more easily made, without interfering with its functioning properly in the finished apparatus. Sometimes such a slight change as increasing the tolerance by a small amount will make an appreciable decrease in the time required to make a part. Then again, the time-study man must analyze the job he is studying as to the method employed. He must be familiar with the various methods used in common shop practice in doing the particular kind of job he is studying and must have a knowledge of the cost of equipment for the different methods. Then by comparing the quantities that can be produced in a given time by each of the given methods, together with the costs, he is able to decide which method is the most economical to use in order to produce the quantity required in this particular case. To make this last point clear, we will assume that the time- study man is required to study the blanking and perforating of a small brass washer. He knows that in common shop practice there are several kinds of punches and dies that would do this work. He must analyze the job and see if the most economical tool is being used. If the quantity required is small, a cheap tool for blanking and another for perforating will probably be the most economical method. If the quantity required were considerably greater, a more expensive tool, say a follow punch and die with liners, would probably be the best, and if the quan- 114 TIME-STUDY tity required were extremely large, a still more expensive tool, say a multiple perforating and blanking punch and die, making three or more pieces per stroke, might be the proper one to use, the size and style of punch press being also taken into considera- tion. EXAMPI^ OF A TIME-STUDY Figure 1 is an example of a time-study. A study of the de- sign of this valve brought out the fact that the step on the face was unnecessary, and did not improve the finished product when assembled. As it took a certain amount of time to make this step, the matter was taken up with the designing department and the design changed, and hence the job was made easier for the operator. There were no limits established and this opera- tor assumed that the diameters should be turned to exact size and spent considerable time in doing so. A study of the design showed that a close limit was necessary, so this limit was estab- lished and the drawing changed to show it. And although the limits were close, considerable time was saved in working to these limits rather than trying to get the exact dimension, as was done formerly. The method used to make the piece was then studied. The operator was completing each piece in one operation, chucking the piece on the |-inch stem. The time of the operation on two pieces was taken and was one hour for one and forty-five minutes for the other. The operator and the time-study man then began a study. The operator had never tried running the piece on centers, as he had thought that the .4375-inch stem was too light and the piece would spring. However, he had never tried it, so they tried it out together. Several pieces were first centered, then rough turned and finally finished turned. One piece was sprung during the rough turning, but a lighter cut and a higher speed were tried out on the balance of the pieces with success. The time-study shown was made on the final operation. The total time for the three operations, in- cluding a period for rest and delay, was 14 minutes per piece. To this was added 25 per cent., making a total time of 17. 5 minutes. The operator was to receive extra or bonus pay for TIME-STUDY AS BASIS OF PRODUCTION 115 the amount of time he saved per piece. If he performed the task in 14 minutes, which time was agreed upon by both opera- tor and time-study man as the amount of time a good man 6 « NAME OF OPgRATIOH TIME STUDY PTwraH Ttn m noMPiJDTB nPFR^TTfrn ^ PLA.CE DOG on 1/2' DIAM. & PLACE BETWKKM CEHTERS FIHISH TDM 4.25 DIAM. FIHISH TDBH BEVEL TDRW BACK OOUPOUITO TO FIXED GRADUATION SET CROSS SLIDE TO FIXED GRADOATIOH TO TORH 0.4^75 DI^M. FIHISH TUHB 0.4375 DIAM. TURN PAPER IN PIN (MACHINE FEED LONGrnjDIHALLT> HAND FEED ACROSS') Rim OnT lOOL 4 SET TO FIXED GRAD. FOR 4. 25 DIAM SMOOTH TAPER ON 0.4375 DIAM. i BORR ALL EDGES WITH FILE REliOTE PIECE ROTE- ON THE FIRST PIECE THE GRAD. OF THE CROSS SLIDE SCALE IS TOTED FOR THE 4.25 t THE 0.4375 HIAM. AND GRAD. FIXED AT ffHIOH THE COUPODTID SHALL BE lOT WHILE TURNING THE 0.4375 AND 4.25 DIAM. THESE Cd UPOONIi AND CROSS SLIDES ARE THEN TURNED TO FIXED GRAD. SUBSEQUENT PIECES, UNTIL A NEW SET OF GRAD. HAS FIXED DDE TO A RESET OP THE TOOL AFTER GRINDING (S) ALL GAGING fWITH SNAP GAOES^ IS TO BE DONE ( IN THE PREOEEDIHG PIECE WHILE MACHINE IS m OPERATION. ACTUAL TIME 320' 1.30 l.QO punch: 175~W ALL01ANCE I OR EEl 2.20 2.40 I'OO 1-70 2.05 2.20 IWG TC3L5~4 DP his. 3.35 3.35 3.10 REST & DELAY EXTRA TB£E CM FIRST PIECE clean: JG MACHINE ALLOWANCE 25^ ALLOTONCE FCR SET JP 2B ■ffls: TOOLS USED VALVE PROPER 3/8* S(5."BIT HOLDER FOR SAM8 CENTERS i DOO 2 SNAP GAGES 8^ 'STEPYVAS OMITTED 5* HYDRO. VALVE HAOHiHE SHOP 3/5/20 An Example of a Time-Study would spend on it working steadily, he would receive 25 per cent, of his pay for the period as a bonus. As the operator knew he would be able to make from 20 to 50 per cent, more money he 116 TIME-STUDY was quite glad to give it a trial, and was satisfied with the stand- ard that was set. A copy of the time-study was pasted on a cardboard and was used as an instruction sheet by the operator in the future when doing this job. This is very important, as in case of a change of operators, the new operator knows exactly how to do the job to make it in the given time. Then again, by giving the opera- tor a copy of the time-study it shows him that the time-study man is "above-board." The writer has seen a great number of time-studies made by time-study men, who were considered as good men, that certainly would raise some commotion if placed in the hands of the operator. The actual time set as a standard was sometimes as much as 50 per cent, less than the time the operator actually took during the study. The time-study man evidently considered that the operator was "stalling" half the time. If the time-study man cannot win the confidence of the man to the extent that the operator will cooperate with him, he should either do the job himself, and let the operator hold the stop-watch or he should go to some other operator; but in any case he should never set as a standard a time that the operator did not actually make while the job was being studied. BEING "above-board" Being "above-board" is not always appreciated by time- study men. Some make it a point to conceal the stop-watch. This in itself will destroy the confidence of any workman. The writer believes it is good practice to show the operator the time on the stop-watch in all cases where it does not take his atten- tion away from his work. He knows then that he is getting "a square deal"; and that is all he wants. This gets his coopera- tion more quickly than anything else. SIX FUNDAMENTALS OF TIME-STUDY BY SAMUEL R. GERBER THERE are two distinct elements in time-study, the hu- man and the technical. The success of the technical element depends greatly on the manner in which the human element is treated. The first essential of an investigation is the collection of all the available information pertaining to the job. This is a very difficult matter in a factory. The man who worked on the job for years has learned what he calls trade secrets. He will not part with these unless he can see that by so doing he will be benefited. The time-study man, in attempting to obtain this and other information, starts with a handicap. The workman looks upon him with suspicion. His past experience in the fac- tory has brought him to doubt the sincerity of any one who meddles with his job. The time-study man's first task is then to win the workman's confidence. Winning a person's confidence is the same problem in the factory as it is anywhere else. Confidence exists only between friends. To have a friend one must be a friend. To be a friend of the workman, the time-study man must feel that the operative is fundamentally as good a human being as any other. The time-study man must realize the great truth that, "A man's a man for all that." With this mental attitude the time-study man must proceed to take the workman into his confidence. He should explain to him the methods to be applied in the investigation, and keep him in touch with the progress of the work. If the workman should offer a suggestion, the time-study man should seriously consider its value. If it cannot be applied he should patiently give reasons why it cannot be applied. He should not try to impress the workman with his "superior" knowledge. The workman is not interested in that, and besides he takes that for 117 118 TIME-STUDY granted. We are all anxious to show how much we know — therefore, the time-study man should utilize this psychological truth to assist him in obtaining the information he is seeking by giving the workman a chance at it. The time-study man's tact consists mainly in recognizing that the people with whom he is associating in the shop are as human and as subject to human reactions as he is. The order of work of the time-study man is as follows : A. Determine if the operation to be studied is necessary B. Get data on the life of the tools and record miscellaneous stoppages C. Make detailed investigation D. Make time study E. Write up analysis and instructions F. Instruct the operative To take these up in detail : A. DETERMINE IF THE OPERATION TO BE STUDIED IS NECESSARY It is frequently discovered on detailed investigation that an operation which is entirely unnecessary is being done on a part. An operation is sometimes started because of certain existing conditions, and when the cause for the operation is removed at some future date, the operation is still continued due to some- one's negligence. In one case an investigation disclosed the following condition : A cast-iron nut about 3 inches in diameter and 2| inches long was being turned all over to give it a smooth finish. This nut was afterward japanned with two coats of black japan. It was used in an insignificant place in the ma- chine. The investigator had some nuts japanned without ma- chining them. He showed these to the superintendent together with a japanned machined nut. The superintendent saw no advantage in the machining operation and it was eliminated. In the japanning department of a large factory a sanding and japanning operation were both found unnecessary upon in- vestigation. The machine parts were large iron castings re- quiring a high finish. The parts were first puttied, baked, then again puttied and baked. They were then sanded, that is. SIX FUNDAMENTALS OF TIME-STUDY 119 rubbed down with carborundum cloth to give a smooth surface for japanning. A coat of japan was applied with a hair brush. This being the first coat of three to be applied was considered to be of minor importance and was done with worn-out brushes and not very clean japan. After this was baked it was rubbed down with carborundum cloth to remove the rough spots caused by the dirt in the japan and brush. Then two more coats of japan were applied and each coat baked on. The investigation disclosed that careful sanding in the first place and two coats of japan, carefully applied with clean brushes and japan, produced a better finish than the old method with the three coats of japan and an extra sanding. It is sometimes possible to change slightly the design of a machine part which will make certain operations unnecessary. An operation can be combined with another by a change in the fixture or in the tool, thus eliminating one of the individual operations. B. GET DATA ON THE LIFE OF THE TOOLS AND RECORD MISCELLANEOUS STOPPAGES The investigation should start with a knowledge of existing conditions. These cannot be learned by casual observation. The observer should record everything that interferes with the regular run of the operation for a period of time. The length of time that is necessary to take these data depends on how complicated and variable the operation is and also on how thorough the investigation is to be. If the number of parts made in this operation per year is very small it will not pay to make as thorough an investigation as if very many of the parts were used per year. A summary of these records will disclose all the troubles of the job. While the observer is recording these stoppages and also the life of the tools he should note other details that will need atten- tion. During this time he should observe and analyze the gen- eral conditions governing the operation. To assist him in these observations the following list of suggestions has been compiled : 1. Is the machine properly located.^ 2. Can the jig or fixture be improved. ^^ How? 120 TIME-STUDY 3. Is the machine in good condition? 4. Can any stops be placed for locating the jig? 5. Are the tools high speed or carbon steel? 6. Have the tools proper rake and clearance angles? 7. Are they properly set? 8. Are the tools running at the proper surface speeds? 9. Is the feed per revolution correct? 10. Is the proper lubricant or coolant used, and does it run freely? 11. Can any of the details of the operation be eliminated? 12. Should the operator be standing or sitting at work? 13. Is the operation safe for the workman? 14. Is the machine properly guarded? 15. Are the limits on the work closer than necessary? 16. Is the work of the required quality? 17. How often should the work be gaged? 18. Can any of the sharp corners, in the part being ma- chined, be eliminated? 19. Who supplies and removes the work to and from the operator? 20. Are the work boxes of the proper size and shape, and properly located? C. MAKE DETAILED INVESTIGATION After having obtained sufficient data the observer should study in detail the conditions called to his attention by each of the above questions. The location of the machine is important. There should be sufficient light for the workman to enable him to set tools prop- erly, or place parts in the die or fixture without fumbling. The relative position of this operation with preceding and succeeding operations should be considered for the purpose of reducing the amount of trucking. Placing and removing parts from the jigs or fixtures and clamping the work in the fixtures are details which are often subject to improvement. Sometimes a new set of tools may be necessary. But it is most important to use the existing equip- SIX FUNDAMENTALS OF TIME-STUDY 121 ment to the best advantage. It is not the duty of the investi- gator to invent new tools. Poor quality of work and low production are often due to a faulty condition of the machine. The following is a list of con- ditions frequently found : 1. End play in the spindle 2. Up-and-down play in the spindle 3. Play in the cross-slides 4. Play in the tool carriage due to worn ways 5. Chuck running out of true 6. Belts loose, too narrow, or not heavy enough 7. Loose countershaft frictions 8. Friction feeds worn out 9. Pump not supplying oil freely The investigator should see that these conditions are corrected before attempting to speed up the machine. The cutting tools are also a considerable factor in the quality and quantity of production. The investigator must know of what steel the tool is made, whether it is carbon or high-speed steel. Then for a more thorough study he makes a sketch of the tool as when in operation to show the rake and the clearance angles. This shows whether the tool is properly ground and set considering the class of work and the kind of material that is being worked on. The rake angle of a tool cutting on the circumference of the stock is the angle formed by the radius of the stock passing through the cutting edge, and the top plane of the tool. The rake angle of a tool cutting on a flat surface is the angle formed by a line perpendicular to the plane of the flat surface and the top plane of the tool. The clearance angle of a tool cutting on a flat surface is the angle included by the plane of the surface and the front plane of the tool. In nearly all cases the clearance should be just enough to keep the heel of the tool from rubbing on the work and no more. A common error in the shop is to allow too much clearance thereby weakening the cutting edge. The amount of rake the tool should have varies considerably 122 TIME-STUDY with the kmd of material cut and the quality of work required. A tool for a roughing cut should have more rake than one for a finishing cut. The rake and clearance angles are also affected by whether the tool is set on center line of the work, above or below center line. The next to be considered is the feed per revolution of the tool and the surface speed. The feed per revolution is the dis- tance the tool advances into the work in one revolution of the spindle. This is usually given in thousandths of an inch. The surface speed is the distance a point on the moving object travels in one minute. This is usually given in feet. %dN S = 12 "Where S = surface speed in feet per minute d = diameter of stock or cutter N = revolutions per minute of the spindle or arbor To determine the proper feed per revolution and surface speed the following questions are to be taken into consideration: What is the proper life of the tool.? How much time is required to grind and set the tool.^^ It may be more economical to run the job at a lower feed and speed when the cost of the tool is taken into consideration. If the cost per piece is increased by high speed there is usually no advantage in speeding up the machine. From the tool data obtained at various feeds and speeds the cost per piece can be figured for each of the experiments and the minimum cost determined. The following formula was derived to assist in determining the proper feed and cutting speed as affected by the cost per piece. Let C = total cost per piece T = total cost of tool n = number of grinds in tool P = number of pieces produced between grindings p = number of pieces produced per hour SIX FUNDAMENTALS OF TIME-STUDY 123 h = hours tool lasts between grindings r = hourly rate of operator s = time to grind and set tool W = labor cost per piece G = tool cost per piece of one grind rs + rh Then W = = labor cost per piece ph T T G = ph = = tool cost per piece n np h T r(s-\- h) C = G -\-W = — — 1 = total cost per piece. np h pk The lubricant used considering both the kind of lubricant and quality will have a decided effect on the results. It is always advisable to have as large a stream of lubricant or coolant on the work as can be obtained. For drilling or rough turning a thin coolant should be used. For reaming, forming, and thread- ing it is necessary to use a heavy lubricant, such as lard oil. A factor more important than the cost of the product is the quality of the work. It is of little value to find that a tool can stand a high feed and speed if the required quality cannot be maintained at that speed. Production is useless unless it is of the required quality. The time-study man must therefore investigate this factor and find just what quality is required. The product may be as good at the higher speed as it was when the investigation was started, but this is not always sufficient proof that it is good enough. By consulting the chief inspector or the superintendent it may be found that the required quality is such as to make it necessary to reduce the production to obtain it. On the other hand, the limits on the work may have been held too close for practical purposes. The limits are sometimes set by persons who do not realize the practical difficulties in- volved in living up to them. While the time-study man is investigating the technical de- 124 TIME-STUDY tails of the machine and the tools, he should also look into the conditions governing the comfort and the safety of the operator. He can determine whether the operator should be standing or sitting while at work. This will depend upon the ease with which he can accomplish the operation in either position. The operator should be instructed to sit whenever the operation permits it. The work should be piled at a convenient distance to allow for safety in operating the machine. The investigator should see that all safety devices are in use, that gear guards and belt guards are in place, and that there are no projecting set screws on rapidly rotating members of the machine. Safety should never be sacrificed for speed in operation. The moving of the work to and from the work place should be investigated and move men or some transferring device should be installed. The size of the work box will also come in- to consideration in connection with moving and counting of the parts. When the detailed investigation as described has been com- pleted and the necessary changes made, the time-study man will again get data on the life of the tools and miscellaneous stoppages. These data will be of use in setting the task while also checking up the results of the changes that have been made. If no changes have been made it will, of course, not be necessary to get these data. D. MAKE TIME-STUDY The time-study consists of analysis and synthesis. The time to do the entire operation is usually a variable. By breaking up the operation into its elements the detailed operations which remain constant in time can be separated from those that vary. The machine operations are kept separate from the hand opera- tions. This enables us to obtain accurate time for each of the machining operations. If it is ever required to add to the ma- chining operations, the task can thereby be changed to allow for the increase in machine time without restudying the entire job. The hand operations are then further broken up according to convenient points of observation. The point of observation is the beginning of a detailed opera- SIX FUNDAMENTALS OF TIME-STUDY 125 tion at which the stop-watch reading is taken. This is selected by the time-study man, to faciHtate the work involved in mak- ing the time-study. The time-study man reads the stop-watch, writes the readings on the time-study sheet, and observes the operation practically simultaneously. It is, therefore, neces- sary to have the point of observation such as can be noted with- out looking up from the stop-watch. The point of observation should be at a place in the operation that can be heard or a motion that can be seen without looking up from the stop- watch. After selecting the points of observation the time-study man should write a description of each of the selected detailed opera- tions. For example, an operation done on a Whitney hand- milling machine can be described as follows : A. Run brush through fixture with right hand while picking up piece with left hand. Hang brush on edge of carriage while inserting piece in fixture with left hand. B. Move work into cutter to mill slot. C. Pull carriage back with right hand, unclamp fixture with right hand. Remove piece with left hand and place in box while picking up brush with right hand. The time-study man sets himself at a convenient position for observation and as near to the job and the operator as possible without interfering with him. It is necessary that he should be near the operator and concentrate on the job rather than lounge on a stool five or ten feet away. The effect on the work- man is evident. The time-study man starts the watch at zero and records the readings at each point of observation, until at least 20 pieces have been done. Should the operator stop to do anything be- sides his regular work during the study, the stop-watch should be allowed to continue and the reason for the extra time noted in the space between the readings. At least 20 readings should be taken, but very often it is found advisable to take 40, 60, 80, or 100 readings. In operations of short duration and greater variation more readings are necessary than on operations taking more time and less variable. Time required to change trucks, gage work, etc., is also noted during the time-study. B c 20 17 No. Time. No. Tim 4 8 3 4 13 9 7 5 2 10 5 6 1 11 2 7 126 TIME-STUDY The time for each detailed operation is the difference between the recorded times at two consecutive points of observation. These times are summarized in the following manner: Operation A Total 20 No. Time. 5 4 12 5 2 6 1 7 Minim, time. . . 5 9 5 "No." means number of times the operation was done in the "time" 0.04 minute, or 0.05 minute, etc. "Total" is the total number of readings that were taken on that detailed operation. The last column with less than 20 readings shows where the time-study man has missed some readings or where other things than those involved in the regular operation were done. These are taken care of in setting the task. The sum- mary shows whether there are any broad variations in the time for a detailed operation. Each operation showing such varia- tion is investigated and the cause of the variation determined and eliminated if possible. If the variation is caused by something that cannot be prevented it is allowed for in the task. The following is a list of probable causes of variations in the detailed items: 1. The tools or fixtures not working properly. This should be corrected and another time-study made to find the proper time for that operation. 2. Variations in the commercial materials, such as forgings or castings. This variable cannot be eliminated, and is allowed for in the task. 3. Lack of skill of the operator. The operator should be corrected and instructed and another study made to obtain the proper time of the skilled workman. 4. Soldiering: Unless the operator does this systematically, which is unusual, the time for the detailed operations will vary, SIX FUNDAMENTALS OF TIME-STUDY 127 as he consciously slows down and unconsciously comes back to the normal time for that operation. This condition must be handled tactfully and according to the circumstances. Very often this can be overcome by assuming, not that he is trying to he down on the job, but that he does not know how to do the job. By patient instruction he may be brought about to work as required. 5. Mistakes in the time-study man's readings: When, finally, the correct time-study and summary are ob- tained as described above, the time-study man selects the mini- mum times for each detailed operation as shown in the table. The minimum time is the least time in which the operation can be done. It is used as a basic figure for determining the task. A percentage of this time is added for rest and delay. The time selected is the time that occurs 30 per cent, or more of the total number of observations taken. This is based on the assumption that the time-study man's error of observation is not more than 30 per cent, of the total number of readings. The synthesis of the time-study involves the sum of all these minimum times, also allowing for grinding tools, changing trucks or work boxes, gaging work, oiling machine, and all other things that the operator needs to do to perform the operation. To this is added 25 per cent, of the total time for rest and delay. Twenty -five per cent, is found to be sufficient on most classes of work. Where the operator waits for the machine to perform a part of the operation, only 10 per cent, is allowed on this waiting time. The total time which has been figured in minutes per piece is changed to hours per hundred pieces, giving the time allowance for the job. From this the task per hour is figured. E. WRITE UP ANALYSIS AND INSTRUCTIONS The results of this entire investigation are written up in a report giving the analysis of the operation and the synthesis. An instruction card is made out giving all necessary instructions to the operator for setting up and running the job. A rate card is made to give the shop clerk the time allowance, number of pieces per hour, and the class of workman necessary for the job. A tool list, giving a list of all the tools used on that job, is made 128 TIME-STUDY to be used in the tool cage. Copies of all these forms are kept in the manufacturing office. The instruction card and analysis sheet and the time-study sheet contain the same fundamental information, but written up to suit the different purposes. The time-study sheet contains a detailed description of the operation as shown above and all other data pertaining to the job. The analysis sheet gives a concise analysis and synthesis of the elementary operations and any data which will be essen- tial to a correct understanding of the investigation and its re- sults. It also gives reasons for performing the various opera- tions as described. The instruction card contains all the information necessary for the operator. For example, a detailed operation is de- scribed in the time-study sheet: "Run brush through fixture with right hand while picking up piece with left hand. Hang brush on edge of carriage while inserting piece in fixture with left hand." On the analysis sheet this is stated: "The chips are brushed out of the fixture before each piece is put in, to avoid marking up the ground surface of the work." For the operator's instructions all that is required is: "Brush out fixture before placing new piece, then hang brush on carriage while putting piece in fixture." F. INSTRUCT THE OPERATOR Having determiaed the best method of doiag the job, the time- study man must proceed to train the workman to do the job that way. It is useless to investigate methods of doing work efficiently unless some one is taught these methods. The time- study man must now become instructor. As instructor he again encounters the human element similar to that which he has dealt with as investigator. When he was investigating the job he had to obtain information from the workman pertaining to existing conditions. Now he has to break the workman of old habits and teach him new ones. This must be done with persistence and tact. First, the workman must have a clear conception of the new SIX FUNDAMENTALS OF TBIE-STtlDY 129 method; lie must also realize that this method is easier, quicker and more profitable to him. The instructor must present the method very clearly and in detail. He should describe every motion used in performing the operation and guide the work- man in executing these motions. This should be repeated until the workman is thoroughly familiar with each elementary detail of the operation. The instructor may become discouraged at the workman's apparent stupidity, but he must bear in mind that he is dealing with the obstinacy of habit. It will be neces- sary to repeat the directions and guidance many times before a thorough conception is established. It would be unwise to expect the workman to learn to do the job by observation alone. One cannot learn to drive an automobile by observing the chauf- feur. Nor can a child learn to write by observing an expert penman. It is necessary to drill the pupil in every element of the operation to obtain the desired result, as habit formation is a slow and tedious process. IMPROVEMENTS IN TIME-STUDY METHODS BY A. H. CUBBERLEY THOSE who are familiar with the methods followed by the average time-study man cannot help but realize that there is much chance for improvement. So I wish to point out a few improvements that will help time-study men to increase their own efficiency, and to make more accurate and a greater number of studies in a given time. For certain purposes it may suffice to divide an operation into large-enough elements to require only one entry every two or three minutes; for others, an entry may be required as often as seven or eight or more times in one minute. During the writer's experience in making time-studies containing short- time elements, the need has often been felt for a device to hold more than one stop-watch, so that one could be stopped but not snapped back to zero while another could be used to record the time of the next element. It would then be possible to make entries on the time-study sheet before the registering watch was snapped back to zero, and with such an arrangement it was thought it would be easier to make accurate time-studies provided the arrangement for operating the two watches was not too cumbersome. A FOUR-WATCH BOARD The time-study board shown in Figure 1, from a front view, was devised to meet this requirement. This device has four watches. Three are decimal timers and one is an ordinary cheap everyday watch. The two watches on the left-hand side of the board are connected by a tandem control so that by operating a single lever the first watch is stopped and the second watch is started, and by operating the same lever in the opposite direc- tion the second watch is stopped and the first watch is started. To snap either watch back to zero, the stem at the top is used. 130 1 r ^^,^^^ Hi 1 P;/ /« y^ j-^ ^""^1 W^^^iM ^7 MsA. ^^ t" ".iridi 1 '"'., 'v5 K^"^ "^^^M W ^miiiii ii^^^Ji Wi '"■dHj ^■^7.j.jSSH ^K'" -.—...die^^^^^^H * P^^ P / /' ,/ 'J Fig. 1. Front View of Tandem-Coxtrolled Time-Study Hoard Fig. '2. Back \ie\v of Time-Study Board IMPROVEMENTS IN TIME-STUDY METHODS 131 In making studies of repetitive operations, it is good practice to observe the operation for a short while before attempting to record any elapsed time readings. Then the elements of the operation are written down in advance in the order of their occurrence. If the same operation is done differently by differ- ent operators, the time-study sheets will show the actual methods of each operator. Later on, when a standard practice instruction card is being made out, the sequence of operations which is the most desirable may be adopted. In making studies of other kinds of operations, if the elements extend over long-enough periods of elapsed time to permit, the operations may be analyzed and the elements written down ana the elapsed time recorded as the work progresses. The lattet method is adaptable for making studies of events or elements of activity which occur chronologically but not necessarily in repetitive cycles An example of this kind of study would be a crew doing miscellaneous work, or an office or factory em- ployee whose duties were not planned or standardized, and of which it was desirable to learn the percentage of total time used in working and the percentage lost through delays or waiting. Such a study would show the details of all time working and time waiting. It is logical to assume that if the device for hold- ing the time-study sheets and stop-watches is so designed that the watches may be manipulated without inconvenience, it would be much easier to make the studies and also be possible to observe the operations in greater detail. Another advantage, and perhaps the most important from the standpoint of saving the time-study man's time and in- creasing the observer's efficiency while making studies, is that when one watch is stopped at the elapsed time for an element the other watch is started automatically by the same move- ment. This watch that was stopped continues to register the time elapsed imtil it is snapped back, which need not be until after the entry has been made on the sheet. It may then be snapped back to zero where it will remain until the other watch is stopped when it will again start automatically to record the time elapsing for the next element. The two watches on the right-hand side of the board both 132 TIME-STUDY run continually, one registering hours and minutes and the other registering minutes and hundredths of a minute. In the il- lustration, the second hand on the watch is shown making one revolution to each revolution of the decimal hand on the stop- watch. The half -hour hand of the stop-watch makes two revo- lutions for each revolution of the hour hand on the ordinary watch. After using this time-study board for some while, how- ever, it was noted that the second hand on the watch, and the half-hour hand on the stop-watch were not needed and it was an improvement which simplified things somewhat to have them removed. Accordingly, the time-study boards now in use by the writer have no second hand on the watch and no half-hour hand on the one stop-watch. These watches that run continually are used to record start- ing or finishing exact time of any complete cycle or operation, and are also useful to check up the individual cycles. The watches running under tandem control make one com- plete revolution per minute and each minute is divided deci- mally into 100 parts. Each one hundredth part of a minute is measured off, by three quick jumps of the decimal hand. When one watch is stopped and the other started, there is the possi- bility of an error equal to one of these small jumps or about one three hundredth part of a minute. Therefore, if the recording watches are reversed quite a number of times, there might be a small loss when the totals of times recorded are checked up with the difference between the time of starting and the time of fin- ishing as shown by the two watches that run continuously. However, one of the greatest advantages of making time-studies with this device is the possibility of obtaining time-studies cover- ing 60 full minutes for every hour of the observations. It will also be possible to check up the total time of all elements shown in any cycle against the actual time elapsed as shown by the readings from the watch and decimal timer correct to the same part of a minute as recorded by the tandem stop- watches. If any element of the operation or time has elapsed, which is not accounted for, it will immediately show up during the check- ing process. On the other hand, if the total time of elements IMPROVEMENTS IN TIME-STUDY METHODS 133 observed cheeks up it will prove absolutely that the total times shown in the studies are true and correct. The ease with which time-studies may be recorded and the value and use that may be eventually made of the information contained in them depend considerably on the form of time- study sheets used and the elements into which the operations are divided. For example, if it is desired to speed up the output of a machine, the time-studies should be divided into elements that will show clearly all times that the machine is idle. If it is desired to subdivide the man movements so that part of the work being done by a skilled operator may be done by a skilled laborer, to decrease the cost or increase the output or both, the study should show the times required for each element of the operation, classified according to whether the element is neces- sarily a skilled movement or potentially a brawn or semi-skilled movement. With the hour, minute, and hundredth part of a minute, which has elapsed, conveniently shown by the two right-hand watches at any time of the day, it is possible to note the time that any extra cycles are started and finished. This makes it possible to obtain valuable additional data while making regular time-studies, without interfering in any way with the progress of the regular operations. READING CONTINUOUSLY RUNNING WATCHES To read the hour, minutes, and the hundredth parts of a minute accurately on watches that are running continuously, it is best to note the elapsed time recorded by reading from the decimal hand first, as follows : " .20 after 9 :30." It should be written thus: "9:30.20." It is then possible at any later time that may be convenient to determine the amount of time elapsed between the starting and the finishing of the extra cycle or oper- ation by deducting the time which had elapsed at the start from the time which had elapsed at the finish of the extra cycle or operation observed. When making speed studies of machines or operations, it is desirable to know accurately what per cent, of the total time of man or machine is spent "waiting," and what per cent, is 134 TIME-STUDY spent "working." From this may be estimated approximately the amount of time that is lost which might be applied to pro- duction. These may easily be obtained when using the im- proved device by adopting the plan of merely running one of the tandem watches to record "working" and the other to record "waiting." No matter for what purposes time-studies may be taken, they should show as separate elements all times or motions which may be finally combined or eliminated, and also all other information so arranged that the results are plain and convinc- ing. The proper conclusions may then be drawn promptly. For this purpose, the writer recommends the use of graphs. On the time-study sheet shown in Figure 3, the narrow spaces above each element of the repetitive cycle are used to show graphically the average percentage of time that is required. If the sheet is to be photostated, the times may be graphically indicated by different kinds of crosshatching, but if the original study is to be shown it seems better to indicate the times for different classi- fications by colors. For example: Man working, blue Man waiting, yellow Machine working, green Machine waiting, red Colors are considered better than crosshatching because colors are easier to see than forms. If the studies are merely chronological observations extending over a certain period, it is easier to show the points graphically by reducing the times to percentages and then using circles divided up and Crosshatch or color to tell the story. When the study indicates that the total time for a complete operation may be decreased by reducing the time of certain factors or by combining or eliminating other factors, it may be desirable to show graphically the amount of time required when the sug- gested method of standardized practice is followed, as compared with the amount of time required when the studies were made. A convincing method to do this when using circles is to make IMPROVEMENTS IN TIME-STUDY METHODS 135 PI amtSo. i« - PLANNIh 4G DIVISION TIME STUDY r.a.-nr 6-8-1917 1 Repetitive cycles . \ r..i.»A^o« inud guard IIo.R14X. 'LAPSED TIME OBSERVATIom ^1 !«*«, KUMKtm or OMItATWNB - - "' - T — AV«B. 1 WalklOR 4 6teps to tbs )<^ 04 n? 04 nn 04 04 in Of) 3 stooping to floor , 34 03 04 02 l)R 03 D? 31 93 3 Lifting pfLrt & riaing !)•=, !7^ 04 _ OS _ 04 _ 04 Q3 03 38 04 H 04 94 04 07 04 OS 06 35 05 ea 04 03 Q& oa OS oa 3& Q£ SH m OA " m U "" OA on ' OR ■ill ~ hfl oa 7 HoTlns Dart to itoii^ri 07 09 08 08 m g7 09 5S 08 oe 8 PunoblBe 2d bole r QB 08 08 08, "~ ^ 08 ~ 08 S6 08 M 9 VoTl ng pnrt to atop oa OB 07 ba " Si oa oa £6 n oa oa. " ~~ (19 ~ 07 07 "~ M ~ on 08 nn m na M q;^ fl? 03 31 03 n"! 14 nt ri>i OS Ofi IS OS on » 03 0^ M 04 Ofl OS 28 04 14 Entering nount cjn t^lly " ~ ~ ^ ,.,. — r ■hast to S3 ~ 46 ~ 4S ~ so 43 ^.6. i 33 "" "^ OompletB Cyol«« T L8 1 3B^ X 31 r — 1 L9 1 LB X le X sa JL ^ X p jfi. Si- 15 Tims allovanc* for f&tl^e ^ ■~ ~^ h- ftnd unavoldablo dolaye ' ~ ~ _J ~ ~ ps. — — — '~ ~ ~ ~ li Itt ^ so LE0ENI):-Th9 average percent ~ — 1 ~ ~ " of the total average time ~ _- required for each neceseary — — ' — — "" ~ ~ notion Is Indicated graph- ically by cross hatching. StnoiARY ~ ^ ~ ~ Time considered neoeisary 5 Tf. " HI U ■* 1 " "" " " possible to ellrolnat , p If, I ««AHK5 1 Fig. 3. Specimen Time-Study Sheet both circles of the same diameter and to show the proposed saving by a clear space in the one that represents the proposed method. This is better than to use circles of different diame- ters, the reason being that with different sizes of circles the areas are apt to be considered in judging instead of the diameters. The time-studies themselves will be a detailed analysis of the information shown by the graphs. In Figure 4 an example of this is given. 136 TIME-STUDY CHART SHOWING TIMES OF MOTIONS OF THE PRESENT AVERA&E CYCLE. CHART SHOWINS TIMES OF PROPOSED STANDARD CYCLE.) Fig. 4. Ghaphic Illustrations of Average and Proposed Cycle The sections shown not crosshatched represent times of motions that are considered possible of ehmination. Sections shown with the crosshatching represent times of motions that are considered necessary. The numbers in the sections refer to the item numbers of elements shown on the time-study sheet. Average actual time required as shown by time- study 1 .20 = 100 per cent. Considered a fair allowance . 60 = 50 per cent. Time considered possible to save . 60 = 50 per cent. Possible output by present methods based on the average of times observed for complete cycles = 60 -r 1 . 20 = 50 pieces per hour. Actual output as shown by records for past 3 months = 40 pieces per hour. Possible output by proposed method allowing 10 per cent, of each hour for fatigue, possible delays, etc. = 100 pieces per hour. Proposed output = 100 pieces per hour = 250 per cent, of present output. Present output = 40 pieces per hour = 100 per cent, of present output. Proposed gain = 60 pieces per hour = 150 per cent, of present output. EXPLANATION OF SAVINGS Items Nos. 1, %, 3, 4, 11, 13, and 14 are considered possible of elimination. Items Nos. 1, 2, 4, 11, and 13 may be eliminated by a rearrangement of the points of supply and delivery, so the one who delivers parts will deliver to and collect from a point convenient to the machines and at the proper height from the floor to suit the operator. The installation of one of the IMPROVEMENTS IN TIME-STUDY METHODS 137 standard automatic counting devices on the machine will elimi- nate item No. 14 by making it unnecessary for the operator to count and tally pieces while working. The proposed method includes fewer and easier motions, therefore greater skill and automaticity should result and less effort will be required to do the operation in half the time than by the old and longer method. This, with the proper incentive to the workmen, should insure complete success. TIME-STUDY IN SMALL-PAET MANUFACTURE BY PHILIP BERNSTEIN PROBABLY the best method of training time-study men is to team the beginner up with an experienced observer for a period of approximately three weeks; during this time the apprentice, for we may so call him, really does no active work but just becomes familiar with the methods of reading lOOth-min. stop-watch, with the general methods of computing machine feeds and speeds and the technique of writing on his note sheet while reading the stop-watch. He should be im- pressed with the importance of making the most complete notes of the machine, cutters, gears, jigs, and fixtures, etc., in use at the time of observation, and lastly in the office he should be taught the methods of working the study up. SIZING UP THE JOB Upon his arrival at the machine or work bench where a study is to be made the time-study man should acquaint the worker with the reason for his presence. The time-study man should then become thoroughly familiar with the general details of the operation, determining at this time whether the proper fixtures or jigs are in use on the machines, whether the proper amount of lubricant is being used, and lastly whether the operative is sufficiently adept at the task in question really to base a sound rate on his performance. TAKING THE STUDY When the observer is sufficiently familiar with these details of the operation and feels that a fair rate may be arrived at by means of a study, he should begin to enumerate consecutively the minute movements and elements which go to make up the operation. These are recorded as elements in the left-hand column of the form observation sheet. For instance, on a 138 TIME-STUDY OF SMALL PARTS 139 simple drilling operation the elements would read somewhat as follows : 1. Wash jig in soda water. 2. Pick up and place piece in jig and tighten thumb screw. 3. Place jig under drill— Table up. 4. DRILL. 3. Table down — loosen and knock piece out of jig. The observer should time the operator for at least 20 pieces, and while timing, if anything unnecessary or irregular takes place, this should be noted in order that a proper allowance or deduction may later be made. After completing the actual study, such data as the R. P. M. of the cutter, the step of the pulley on which the belt is running, the length of cut— the depth of cut— the material cut, the kind of cutter, lubricant, fixture or jig number, gages used, number and type of machine, and present rate should all be noted on the reverse of the study sheet. The sketch of the piece should show where the cut is and there should also be a sketch of the cutter. The shop work is then completed and the rest of the work is to be done in the office. DEFINITION OF TERMS Some of the terms which are in use may perhaps bear defin- ing. A "cycle" is the minimum time, selected by the time- study man, in which the operative should complete the opera- tion on one piece. A "dead-average cycle" is the average time, deducting all unnecessary and irregular delays, in which the operative has completed the operation on one piece during the study. A "working cycle" is the time allowed by the time- study man, in which the average operative should complete the operation on one piece. The "working cycle" is obtained by adding a certain percentage to the "cycle." WORKING UP THE STUDY First, the differences in time between the elements is taken and the time for each is totaled and averaged after casting out any abnormal values. Then fair minimum values are selected and the "cycle" is obtained by totalmg these minimum values. The most difficult portion of the work now confronts the time- 140 TIME-STUDY study man, namely, that of trying to decide just what class of operative he has observed, and just what allowance should be granted this operatiye over the dead-average "cycle." The ideal man to study is one who is somewhat above the average and would fall in a class which we may arbitrarily desig- nate as good. Such a man is of the industrious type who wastes no motions and in addition to being thoroughly familiar with the task in hand is endeavoring to give the observer all the oppor- tunity possible to arrive at a fair rate. It is obvious that all classes of workmen are to be found in any establishment and it is also true that the time-study man may be forced to make his observations on a worker whose ability and effort may place him in any class varying from excellent to decidedly poor. The test of the time-study man really lies in this : his ability to classify the worker he has observed and so arrive at a fair allowance over or under this dead-average cycle and thus arrive at a fair rate. For all operations, both hand and machine, the operative should be classed as very good, good, fairly good, fair, or bad. The following table shows the percentage allow- ance by which the working cycle should exceed the dead-average cycle; table A for machine and B for hand operations. CLASS OF OPEBATOB ALLOWANCE IN PER CENT. A B VERY GOOD 20&30 15&25 GOOD 15 & 20 10&15 FAIRLY GOOD 5&10 5&10 FAIR — 5& 5 — 5& 5 BAD —25 8i 5 — 25& 5 A very good operative should be able to exceed a rate by from 15 to 25 per cent., while a fairly good man should slightly exceed the rate, that is : the fairly good man or the average man should be allowed just about as much time in which to complete one piece as he actually showed on his study. Up to this point we have not discussed time allowance for grinding cutters, gaging work, washing completed work, etc., all of which play a very important part in arriving at our final piece rate. This has for the sake of convenience been grouped together in a class which we have called preparation time and TIME-STUDY OF SMALL PARTS 141 which will be clearly brought out in the detailed description of some of the time-studies on various types of machines which follows. In connection with the various types of machines in use in small-parts production work many matters of importance enter. It is impossible to group and discuss these in a general way, but a discussion of each of the ten types of industrial work which follow will encompass perhaps most of the important details to be borne in mind in time-study work. DRILLING In working up a rate on a drill press, the time-study man should first ascertain how fast the drills are cutting. For car- bon drills cutting speed should be between 45 and 60 feet per minute, while for high-speed drills, the cutting speed should be between 80 and 100 feet per minute. The diameter of the drill should make no difference in the cutting speed, that is the peri- pheral speed of the drill should be the same for large or small drills. When the cutting speed is too low, it should be changed either by using a spindle with a smaller pulley attached, or if this is not possible, by shifting the belt on the cone or by order- ing a larger pulley on the main line. The time-studj^ man should also always encourage the use cf carbon drills up to | inch diameter, as this effects a considerable saving, for it has been found that small carbon drills, if run at the correct speed, will hold up much better than high-speed drills, the latter snapping in many cases. It must also be remembered that high-speed drills cost more than six times as much as those made of carbon steel. In order to have an additional check on the worker, the feed of the drill per revolution should be computed and should fall within the conservative limits shown in the following table: SIZE OF DRILL TEED PER REVOLUTION .001 1 .002 — .0025 -j3^ .0035 — .004 1 .004 — .005 I .0055 — .007 1 .007 — .009 142 TIME-STUDY I To compute the feed per revolution the correct length of run must be determined. For example, assume the depth of hole to be J inch, the R. P. M. 1,500, the diameter of the carbon drill I inch, and the material being drilled soft steel with .20 per cent. carbon and the time for drilling the hole .08 minutes. The length of run is equal to the depth of the hole + | the diameter of the drill which is in this case .250" + i X . 125 = .292". One third the drill diameter is added for the point of the drill. Now the feed per revolution can be determined from this f orm- , RUN u ^-^ *• 4- -^92" ula: r^ or substitutmg, we get R. p. M. X TIME °' ° 1,500. X .08 = .0024", which agrees with the above table. It must be remembered that this feed can only be obtained when drilling straight shallow holes. For deep holes or holes drilled on a skew, or when breaking through another hole, this feed must necessarily be diminished. No accurate figures can be given for such cases as each is widely different from another. After the working cycle has been obtained the preparation time must be allowed. Usually the work comes in boxes of 200 pieces for small parts, 500 in a box for screws and similar parts, and in trays of 50 pieces for larger parts. The operative should be allowed .50 min. for getting a box of work from the rack and .20 of a min. for getting a tray of work from the floor. The next allowance to be given is one for grinding and setting up the drill and the following table has been found to be useful in this respect: MATEBIAL DRILLED CUTTING TIME BETWEEN GKINDINGS IN MINUTES Screw Stock Soft or Gun Steel 3h% Nickel A. & C. Steel Spring Steel For example, if the material were spring steel, the drill car- bon steel and the average time to drill a hole were .15 min., then the drill should hold up for about 70 pieces. The allow- ance given for grinding and setting up the drill is 2 minutes. Carbon drills High speed 30 60 25 50 15 30 12 24 10 20 TIME-STUDY OF SMALL PARTS , 143 Next comes the gaging allowance and for the ordinary pin hole, .10 min. for each 50 pieces is sufficient. For a more difficult hole, the gaging allowance should be actually timed out. Then the machine hand must count his work, which takes 1 minute for about 200 pieces and also wash his work in a soda kettle, which also takes about a minute. Lastly, 2.5 minutes is allowed for delivering the work to the lot room and changing the operation ticket. When the preparation time is totaled, a flat 25 per cent, allowance is added to it to take care of un- avoidable delays which arise from time to time. An allowance of 2^ per cent, for personal washing and oiling the machine is given, which is based on 15 minutes in a ten-hour day. When the rate has been ascertained, an allowance for drills must be made, the operative being required to buy his own drills so that he will try to take good care of them. This allowance is computed as follows: Apparent rate = $ 364 per 100 pes. Allowance for 1 No. 3 High-speed drill for each 5,000 pes. at $.23 = .005" " Allowance for 1 No. 12 High-speed drill for each 8,000 pes. at $.20 = .003 " " True Rate $ . 372 per 100 pes. The operatives usually find no difficulty in making the rates, where the job is an all-day one; but frequently such is not the case. Often the man must change from one job to another every few hours, and in this case, an additional allowance must be made for setting up the new job. This is usually covered by a flat 5 per cent, allowance. PROFILING MACHINES Usually the first element in a profiling study is: "Wash Chips from Fixture with Soda from Hose." If this element takes longer than .06 or .07 of a minute, the pump action is likely to be found faulty or the soda water is not flowing out in large- enough volume. This should be remedied because .06 or .07 of a minute has been found in our experience to be a long-enough average time to wash the chips out. 144 TIME-STUDY When there are roughing and finishing cuts on a single ma- ehme, the element after the roughing cut is : " Table out, carriage right — table in." This element should not take more than .10 of a minute. If it takes longer, the table and carriage are probably not running well oiled. It should require practically no exertion on the operative's part to move the table and car- riage of the profiling machine. Another point to bear in mind is that the finishing cut should in many cases take almost as long as the roughing cut, even though the finishing cutter removes very little stock. The reason for this is that the operative must not hurry the finishing cutter if he intends to impart a smooth finish to his work. On the other hand, the finishing cut should never take longer to make than the roughing cut on account of the large amount of stock which the roughing cutter removes. As to cutting speeds the types and cutters should be divided roughly into two classes, namely, profiling cutters and T cutters. For the first class when they just clean up the stock the cutting speed can be from 300 feet per minute up. For the profiling cutter which removes no stock to speak of, the cutting speed should be about 200 feet per minute. For T cutters, cutting a slot through solid stock the cutting speed should be down between 125 and 150 feet per minute. For grinding and adjusting each cutter 5.0 minutes is usually allowed. The actual total cutting time that a cutter can hold up between grinds can be approximately obtained from the following table, table A being for profiling and table B for T cutters. -A- MATERIAL BEING CUT TIME IN MINDTES Screw Stock 90 Soft Steel 60 Nickel Steel 30 Spring Steel 20 — B— MATERIAL BEING CUT TIME IN MINUTES Screw Stock 45 Soft Steel 30 Nickel Steel 15 Spring Steel 10 TIME-STUDY OF SMALL PARTS 145 The time-study man should find out whether the cut is an important one or not. An important cut requires a considerable amount of gaging, and this aflPects the rate fully as much as the actual machining. The operative must file the burr from the component, hand ream in some cases, and then try two or three or perhaps four gages, all of which takes about 2 minutes. The other allowances are standard ones, and are the same as those allowed to a driller or any other operative. POWER MILLING On power milling machines, a man looks after as a rule from two to eight machines in a group. The best and easiest way to study these is to treat the whole group as a unit. The observer should watch the man make a few rounds and see that he does not have to wait for any machine in the set. If the operative does not have to wait for any machine, then it is clear sailing and the sum total of the handling times for each machine gives the average cycle. Assume, for example, one machine is holding the man up on each cycle (that is, the operative must wait for one machine to finish milling). Then the observer should see whether or not the feed can be increased. If this is impossible, the cutter may be speeded up, if it can stand it. It is much better, if possible, to increase the feed rather than the speed, because the cutter can stand the increase in feed much better than the speed incre- ment. If, however, it is not possible to use either of these measures, then a duplicate fixture of the long cut should be set up in the same group, and the operative should handle this operation every other round. This arrangement works out so that one machine on this long operation is finished cutting be- fore the operative gets back to it. In most cases, it is possible to eliminate the wait by these measures. In case it is necessary to step the feed up a notch on the cone pulley or to use a faster set of gears, the only way to see whether or not it can be done satisfactorily is the cut-and-try method. Run a piece through on the new feed and then inspect and gage the piece to see whether or not it will meet requirements. This method is not necessary usually, in the case of increasing 146 TIME-STUDY the speed, for there a knowledge of limiting cutting speeds is helpful, as shown in the following table: UATEBIAL BEING CUT CUTTING SPEED IN FT./'lflg. Screw Stock 90—120 Soft Steel 75—90 Nickel Steel 60—75 Spring Steel 50—60 It is not wise to go beyond these limits, because then the cutter will have to be removed from the arbor and ground too often, thereby gaining little or nothing in production. If the cuts are short ones, light feeds and speeds should be used if there are no waits, so that the cutters will not have to be ground so often. It must also be remembered that when milling cut- ters become dull, they leave heavy burrs on the pieces cut. In this case, the filer may complain that the burrs are coming too heavy, and naturally he wants his piece rate increased. When the group of machines is running as well as can be expected, the average handling time for each machine must be obtained. These must be totaled and then a flat percentage added to take care of machine and unavoidable delays. This percentage, which depends on the man's qualifications, may be taken from the following table: OPEBATITB %ALLOWANCE ABOVE ATEBAGS Very good 31—40 Good 21—30 Fairly good 11—20 Fair 0—10 Slow —25—0 Preparation allowances must also be given. For instance, if an operative is looking after a group of six machines, and he has to wash his work in a soda kettle, say every 200 pieces, then the allowance must be multiplied by six, because the man ac- tually must wash his work six times for every 200 rounds. The element would be written as follows: "Wash work m soda kettle" 1.0 x 1 x 6 = .030 min. 200 TIME-STUDY OF SMALL PARTS - 147 There are three main types of power milling machines: (1) Pratt & Whitney 12-inch semi-auto miller, (2) Pratt & Whitney Lincoln type with automatic attachment, and (3) P. & W. Lincoln type or Ames Lincoln type without automatic attach- ment. When the fixtures are simple, consisting of two jaws closing upon the piece by means of a screw, the maximum handling times should check up with the following table: irM OP MACHINE MAXIMUM HANDLING TIME (Ames ) (P. & W. ) Lincoln Type (Auto. Attach.) .20— .25 Minute (Ames ) (P. &W. 5 " " (without Auto. Attach.) .25— .30 " P. & W. 12" semi-auto. .20 — .25 " If, as was previously noted, a man were running six P. & W. Lincoln-type millers on six different cuts, the working cycle would be, according to the table, .30 X 6 or 1.80 minutes. The production on each machine is the same, because the opera- tive attends to each machine the same number of times. There- fore, the rate per hundred would be the same on each operation. For instance, if the hourly production were 30 and the man were supposed to earn 48 cents per hour, the rate would have to be split by 6, or 48 -r by 6 = 8 cents per hour for each operation, which makes the rate per hundred pieces $.08 ~ by 30 or .0027. A few more facts to remember about the handling of milling fixtures are here noted. After the piece has been landed and tightened between the jaws, it is usually necessary to tap the piece with a babbitt hammer. Three or four taps are in most cases suflficient and the observer should deduct all the time taken by tapping in excess of four taps. Another thing to note is whether or not the oil is flowing in large-enough volume. To clean the chips from a fixture .04 or .05 min. should be sufficient. If it takes longer than this the oil pipes should be given a thor- ough cleaning. Once in a while, when a long cut makes a man wait for the knock off, the length of run should be investigated. On a Lincoln-type miller, the time-study man should bring the work up to the cutter by hand, and then throw in the feed. He 148 TIME-STUDY should then time the actual milling cut and obtain it theoretic- ally and see then whether or not the worker can make a round in that time or not. The point is, that in some cases the operative does not bring the work close enough up to the cutter before setting the feed and this results in an unnecessarily long cutting time. If this same long cut were on a machine with automatic at- tachment, where the table runs in on fast motion, the observer should note how far from the cutter the work stops. An eighth of an inch is usually enough clearance, and if the work stops farther away than this the machine stop should be adjusted so as to bring the work up to within one eighth inch of the cutter. This frequently does away with the need for increasing the feed or speed to eliminate a man wait. There are times, however, when a man wait cannot be elimi- nated by any means that have been mentioned. In this case the handling time plus the milling time of the longest cut should be used for the working cycle. As a check, the theoretical milling Run time should be obtained from the formula = Time. R.P.M. X Feed The run can either be gotten actually from the machine or by adding the length of the cut to the length of approach. The length of approach may be determined from the formula A = y' d (D — d), where A = the length of approach, d = the depth of cut, and D = the diameter of the cutter. The feeds for the various types of millers should be computed and tabulated in advance. The following two tables show the feed per revolution for Ames and P. & W. Lincoln-type millers. On these types feed cones and not gears are used. AMES FEEDS (1) .0105 (2) .0165 (3) .0248 (4) .0352 For P. & W. \J0 >t5 so J& fiO 65 ;5 .75 ^ Handlinq TTme j7er. Machine In MinOtes(Avera(je TTme) Fig. 4. The Handling Time Should Be Reckoned from THE Instant the Operative Throws the Feed in on One Machine to the Instant When He Throws the Feed in on the Next Machine ceptionally fast man or what I have termed in Fig. 4, "extraor- dinary," should not vary much from the values in the follow- ing table: BTMBOL ELEMENT THIE IN UINUTES A Play oil stream on fixture to remove chips .030 B Pick up and land piece in fixture . 020 C Pick up and place piece in fixture on pins . 030 HOW TO MAKE GROUP TIME-STUDIES 159 SYMBOL ELEMENT TIME IN MINUTES D Tighten thumb screw .020 E Lock leaf and tighten clamp .025 F Tighten nut with wrench — Lay wrench down. . .030 G Shove pilot into hole .015 H Tighten jaws upon piece with back crank . 030 I Tighten jaws upon piece with side crank . 035 J Tap piece with babbitt hammer — ^Lay hammer down .025 K Tap piece with babbitt punch and hammer — Lay tools down .045 L Tighten further and tap piece down again .030 M Tap all along piece when piece is thin — ^Lay hammer down . 050 N Table in by hand — Throw feed in .030 Oi to Oe Walk to machine 015 to .030 P Brush chips from milled piece — Lay brush down . 030 Q Table out by hand .025 R Stop spindle — ^Throw shipper on .020 S Loosen and remove piece to pail .030 T Loosen and knock piece from fixture — Remove piece to pail .055 U Change piece from one side of fixture to other, . .040 For example, a time-study man observes a certain operation. He notes on his study sheet that the study is made up of ele- ments which are denoted by the symbols A, B, H, J, N, Og, Q, and S. From the times given in the foregoing table, he can see that a skillful and fast handler should do the operation in .18 of a minute. He next notices the average handling time of the operative he is observing, so as to know in what class to place said operative. In reality, after the observer has broken down his study into elements, he can return to his desk and compute the rate with a right degree of accuracy. In the above table, symbol " O " varies as to the type and loca- tion of the machines. This is shown diagrammatically in Fig. 5, in which tables fed in by hand are lettered "A," while tables that run in on fast motion by an automatic attachment are lettered "B.'* When the observer meets with an element which as yet has not been standardized, he should arrive at a fair value for this 160 TIME-STUDY ]HZ] .015 Min. 3rQ 04-.020Min. element, as follows : Let us call this new element by the symbol "V." If he times the operative for the elements which have standard times and finds that the present operative exceeds these values by, say, 25 per cent., then he should feel certain that he is taking 25 per cent, longer on element "V" than a very fast man would take. Then to exemplify further, if "V" actually takes .05 min., he can set his standard time for "V" at .04 min., because the former value ex- ceeds the latter by 25 per cent. The rates per hundred gotten from the curves (Fig. 4) are based on the operatives earning 48 cents an hour piecework. Instead of drawing up another curve for piecework earnings greater or less than 48 cents, the following table will be found useful; Column A showing the piecework, hourly earnings, and B the constant, by which to multiply the rate per hundred, gotten from curves (Fig. 4), in order to get piecework earnings shown in Column A. Oj-. 020 Min. 05= .025 Min. 06 -JOSO Min. Fig. 5. Showing Hand and Machine-Fed Tables A. B. $.40 .833 .42 .875 .44 917 .45 938 .50 1.043 .52 1.084 .54 1.125 .55 1.146 .60 1.250 .62 1.292 .65 1.355 .70 1.460 .75 1.563 *80 :.....\. ............. 1.668 HOW TO MAKE GROUP TIME-STUDIES 161 Since this method of timing each operation as a unit has been started, the operatives have been satisfied, because now they do not have to wait several days for all the rates to be changed every time one operation is removed from or added to the group. It makes for less routine work in several departments and creates general satisfaction. INSTRUCTIONS AND SUPERVISION How to Write and Use Standard Practice Instructions "Patrolling Supervision" — A New Foremanship HOW TO WRITE AND USE STANDARD PRACTICE INSTRUCTIONS BY WILLARD S. WORCESTER t I THOUGH the advantages of standardized factory I methods and procedure are to-day well recognized by .£. progressive managers, many factory managements are reluctant or indifferent about introducing any greater degree of standard practice. One common reason for this is that there is often no one available with the time and ability to determine what changes should be made and what the standard practice should be. Heads of departments are generally too busy to take up this kind of work in the thorough-going manner that is desirable. To many managers, the cost of securing a person for this work would seem an unwarranted expense. But is not a factory likely to derive even greater advantages from this kind of standardization than from that aimed at in, for example, time-studies.^ Not only will the uniformity result in the saving of time to employees, but it will bring about improvement in methods having an important bearing upon the general efficient running of the plant. Efforts toward securing a greater degree of standard practice — especially in factories having a consider- able number of departments whose work is closely related and which are called upon to look after a great variety of different things — are likely to be decidedly worth while. Probably a greater drawback in the minds of most executives than the direct expense involved in revising the practice or de- termining what the standard shall be, is the trouble and confu- sion incident to carrying it into effect. Establishing any new practice involves changes which may affect a large number of employees and necessitate getting every one to do his part in a way that will permit of the smooth running of all the related features of the new procedure. In a plant where the employees have not acquired the habit of being systematic, or where they 165 166 INSTRUCTIONS AND SUPERVISION have been habitually left to do things as they see fit, the task is a particularly difficult one. That there may be the minimum of confusion and delay, it is of the greatest importance that the methods followed in instituting standard practice be most care- fully considered and outlined in advance. Broadly speaking, there are two methods that may be fol- lowed in instituting any standard practice. One is to depend upon verbal instructions; the other, upon written instructions. To obtain the best results, use should be made of both. The former, especially in the form of conferences of heads of depart- ments, is of the greatest help in securing the cooperation of those who will be called upon to execute the details of the new practice and in serving to explain its advantages and clear up misunder- standings. Such conferences will do much toward offsetting the impersonal character of an order in writing. To be lastingly effective, however, personal instructions should be backed up by written instructions — ^hereafter referred to as standard practice instructions or simply instructions. Verbal instructions are more easily forgotten, disregarded, or misunder- stood than orders in writing, and do not carry the same weight as a typewritten standard practice instruction signed by some official of the company. Moreover, in personal instructions there is much greater liability of forgetting to explain some im- portant detail. The policy of avoiding verbal orders is not, however, all that is necessary. That the full benefit may be derived from stand- ard practice instructions, there should be established some regu- lar procedure providing for their preparation, approval, and issuing. Otherwise, there is the danger that foremen and heads of departments will find themselves swamped with a great quantity of written orders, instructions, routines, etc., issued by different persons, sometimes contradictory, often changed and not in accordance with any uniform or well-considered system. Under these conditions, it is no wonder if foremen hesitate about looking through their mass of papers whenever any unfamiliar situation arises. This was the condition which had been reached by a moderate- sized factory manufacturing electrical specialties. The man- STANDARD INSTRUCTIONS . 167 agement had been making special efforts to improve and standardize its methods and had adopted the policy of always incorporating in writing any new standard practice affecting several departments. This was important, for it was necessary to secure adequate control over a very great variety of work. The company's monthly sales averaged about 300 different items of merchandise. To manufacture these it was necessary to carry a stock of more than 2000 different kinds of raw ma- terial and finished parts, over one half of the finished parts being manufactured in the plant before entering into assemblies. After a year and a half of efforts in the line of standardization and perfection of a system to meet this complicated situation, many satisfactory results had been obtained. But things were far from running smoothly. Foremen were willing to cooper- ate, but there was such a multiplicity of varying conditions to meet, that it was not surprising that there were constant delays encountered. To take a concrete case; suppose an assembly department discovered certain purchased parts to be defective after these had passed inspection and been charged from the stores depart- ment against the production order for which they were to be used. In a case like this, it would be necessary to notify the cost department, so that the production order might not stand charged with the cost of these parts. The purchasing depart- ment should also be notified so that provision might be made, if possible, for charging the vendor for the defective material; the attention of the one who inspected the parts should be called to his carelessness; and some disposition would have to be made of the defective material. If the foreman took the time to look through his collection of routines, he could probably find something that would cover such a situation, but even then he would probably find that his instructions were not explicit enough to cover all details of what was necessary to do. If he relied on his own judgment, he would take much extra time in deciding in just what way to notify the various departments and what to do with the material. The other departments involved, upon being called to take action, would experience similar uncertainties and difficulties. 168 INSTRUCTIONS AND SUPERVISION What is most needed in a case like the one just described is a standard practice instruction which can be quickly found and which will explain clearly and completely everything that has to be done. It was found, in general, that neither of these re- quirements was fulfilled. The company, therefore, decided to start off again with a clean slate and inaugurate an entirely new series of standard practice instructions. The principal features of the plan were as follows: 1. The task of preparing instruc- tions was delegated to one person, who was to devote the greater part of his time to this specific work. 2. A standard practice instructions form with appropriate headings was provided to be used for the first typewTitten page of each instruction. 3. A system of classifying, symbolizing, and indexing was devised so that any desired instruction might be readily found. 4. The policy was adopted of never omitting any detail of any impor- tance when writing up any subject, and of keeping all instruc- tions strictly up to date by means of revision and additions. 5. It was insisted upon that those receiving instructions should keep them on hand for constant reference, and follow out all provisions therein. Figure 1 shows the heading of a sheet of standard practice instructions. The first step taken under the new plan was to appoint a person to carry it out. His method was to make a study of the work of one department after another, ascertaining in each case the methods then followed and conferring with the members of the department with the object of making improvements, wherever it was possible to eliminate duplication of effort, to introduce better forms, to provide for simpler and more direct methods, or to coordinate the work to better advantage. This study brought out the fact that there was a surprisingly large number of cases where standardization was advantageous, but where previously no one had been sure just what was the best procedure. After the conferences the standard practice thus decided upon was put into writing, and a typewritten copy of the standard practice instruction, signed by an official of the company, was sent to all department heads and others affected by the directions therein. To distinguish the new series of standard practice instructions STANDARD PRACTICE INSTRUCTIONS File MOWB Issued: Nov. 8, 1918. Subject: PATROLLING SUPERVISION^FOR FOREMAN IN DEFT. MOWB. 1. HOW THE FOREMAN WORKS 2. SUPPLY OF WORK AND ITS POSITION 3. POSITION OF THE OPERATION TIME CARDS 4. METHODS, SPEEDS, FEEDS, AND OUTPUT 5. CONDITION OF EQUIPMENT 6. QUALITY OF THE WORK 7. ENCOURAGEMENT OF WORKERS 8. MOVING OF THE WORK 9. RELATION TO PLANNING DEPARTMENT 10. SCHEDULED ^ STATIONS Fig. 1. Beginning Nov. 10, 1918, the foreman of the mill department will make regular trips around his department, visiting each of the stations noted below in the order in which they are given. At each station he will in- vestigate the following points and make a record of his visit by marking a piece of work with his initial and O. K. He will see that each workman is supplied with plenty of work, that this work is within easy reach, and that it is available in the order shown by the dispatch-order time cards. He will see that the dispatch-order time cards are placed in the machine-board poc- kets in the order that the planning department has scheduled the work, and that this schedule permits handling the work to the best advan- tage. He will see that the Jdispatch order times his work in the best known way, that he is using the correct speeds and feeds and making no unnecessary motions, and that the output is up to the standard as set. He will see that machine and tool equip- ment is in first-class condition, properly cleaned and oiled, and that belts are in the condition which will make possible maximum continuous production. He will inspect the work turned out and will see that its quality is up to the standard required. If the work is found acceptable he will initial a piece with chalk. If not, he will immediately instruct the workman. He will constantly encourage his workmen to do better work, both in quality and quantity and, if necessary, as it may be in some cases, will insist upon their doing better work. He will see that the move men are keeping up their end of the job, that their trucks are oiled properly, and that they are placing the work for the workmen so as to involve a minimum of handling. In relation to the planning department, the foreman will frequently discuss with the planning department head the planning and routing of the work so as to keep every workman and every machine busy to the best advantage, and so as to reduce the number of set-ups and allow for long runs. Also in order to meet requests for "rush" production. The depart- ment foreman will look over the cards in the planning board and will ask such questions and make such suggestions as he may feel should prove helpful in the work. He will also look over and compare the records showing actual times against standard times for the work done by his men, so as to know who are "falling down" and where his attention can be made most profitable. (Note: — Here is inserted a list of the scheduled stations that the foreman is to visit on his periodic trips through his department.) (Signed) GEO. R. WILSON, Factory Manager. 169 170 INSTRUCTIONS AND SUPERVISION from all "routines," or instructions issued in the past, and from any miscellaneous notices that might be sent out in the future, the first page of each was typewritten on a special standard practice-instructions form. This was headed in large letters *' Standard Practice Instructions," below which were the name of the company and spaces for the following items : signature of the official approving the instruction, symbols of the depart- ments to which copies were sent, the date, the number of the instruction, and the number of the previous instruction, if any, which it superseded. These sheets were punched to fit stand- ard loose-leaf notebooks, one of which was provided for every- one to whom instructions were issued. The plan of showing to what departments each instruction was sent was a valuable one, for it enabled everyone receiving the instruction to know whether or not he could count on any given department being familiar with its contents. Previous experience had shown the importance of being able to lay one's hand quickly upon the instruction covering any desired procedure, hence, the following plan of classification and symbolization was originated. It will be noted that the method of symbolization is based upon the mnemonic system, as developed by exponents of the Taylor system of manage- ment. Upon examination of the instructions and routines is- sued in the past, it was found that these could be divided fairly readily into three main groups; viz., those describing the use of special forms, those applying specifically to the work of individual departments, and those which could not be classified under either of the other headings. All of the new instructions in the first group were assigned the symbol NF; those in the second, the symbol ND; and those in the third, NM — the letter N in each case standing for "in- struction"; F, for "form"; D for "departmental"; and M, for "miscellaneous." As every form used in the factory had a symbol, consisting of SF followed by a number and the two let- ters constituting the symbol of the department that made great- est use of the form, the plan adopted was to designate the in- struction by exactly the same letters and figures, except that the letter N was substituted for the letter S of the form. For ex- STANDARD INSTRUCTIONS 171 ample, the number of an instruction describing the use of a purchase requisition — form number SFiBP — would be NFiBP. Each instruction in the ND group was symbohzed likewise, the letters ND being followed by a number to distinguish it from any others having the same sequence of letters, and by the letters constituting the symbol of the department to which the instruction referred. An instruction describing the han- dling of a cash fund in the purchasing department, for example, might be ND7BP. In assigning numbers, the practice for in- structions in this group, and also in the NM group, was to start with one and go up, except that in each case the numbers from one up to a certain point were reserved for instructions of a rather general nature. All instructions in the NM group were subdivided into five divisions: 1 — Those pertaining to stores and supplies; 2 — those pertaining to tools; 3 — those which could not be classi- fied under any other of the four divisions; 4 — those pertaining to machinery, buildings, or equipment; and 5 — those pertain- ing to payroll, bonus and employment regulations. The sym- bols for these five subdivisions in order were NMS, NMT, NMA, NMM, and NMP. (It will be noted that the last letters arranged one after another spell the word "stamp," thus adding another mnemonic feature to the scheme.) Each instruction in any subdivision was designated by a figure in- serted between the second and third letters. Thus an instruc- tion on the subject of handling scrap might be NMlOS. These instruction symbols may appear at first rather formid- able to one who is not familiar with them, but it will be found that the way in which they are used is easily grasped. With all instructions symbolized in this manner, and arranged in alphabetical and numerical order, the task of finding any special one, even though the full symbol is not remembered, is reduced to a minimum. Naturally, the system would have to be varied to meet the needs of a different factory, but this can be easily carried out, even though it should be desired that instructions be designated by figures only. Still further to facilitate the finding of any desired information, provision was made for issu- 172 INSTRUCTIONS AND SUPERVISION ing from time to time a thorough index of all subjects covered by all instructions. Much care was taken in preparing each standard practice in- struction to see that every detail was clearly and fully described. This had the result of making many of the instructions rather lengthy, but it was believed to be better to err in this direction, rather than leave anything to guesswork. The disadvantage of length was to a large extent offset by providing descriptive titles to all paragraphs in instructions which exceeded several pages. Whenever any standard practice was changed, either a new instruction was issued to take the place of the old one, or the change was described in a special instruction having the same number as the original one, but followed by the word, "Corrections." In such cases, notice was sent out to destroy the original instruction or to mark it "Superseded" or to make a marginal note referring to the changes described in the special instruction. An important part of the general plan for these instructions was insistence that they be lived up to. Conferences were fre- quently held when any new procedure was to be put into effect; the importance of following out all the provisions of the instruc- tion was emphasized at these and all other occasions. If this was found to be impossible or impracticable, the matter was to be referred to the official who approved the instruction. When- ever any instruction was sent out, it was always accompanied by a special receipt, to be signed by the one receiving the in- struction and then filed according to his department. The return of the receipt showed that the instruction had been prop- erly delivered and helped to create a greater sense of responsi- bility for seeing that its provisions were carried out. Any one who had received and signed a receipt for an instruction was strictly to blame if, thereafter, he failed to comply with all the directions therein. Experience has shown that no part of the plan is impracti- cable. A factory which has all its departments written up in this way possesses a record describing the procedure to be fol- lowed on every kind of routine work. Furthermore, the scheme of classification, symbolization, and indexing makes it possible STANDARD INSTRUCTIONS 173 to find at once any desired information. Standard practice in- structions such as these simpHfy greatly the task of breaking in new men. The time and expense which are consumed in their writing and issuing is regained many times over, for they do away with a vast amount of wasted effort spent in seeking and giving special directions and in doing things wrong. "PATROLLING SUPERVISION"— A NEW FOREMAN- SHIP BY L. V. ESTES WHEN the orders have been prepared by the planning department, they are issued to the specific machines and work-places through the dispatch clerk, located either in the planning department or in the department doing the work. When the dispatch orders have been made out and the con- trol board marked up with the time that has been allotted for performing each operation on an order, if the job is "available," the dispatch orders are turned over to the dispatch clerk to be put into process in the factory on the dates scheduled. At each machine or work-place is a board provided with two clips, the upper clip containing the dispatch order for the job in process. This dispatch order will have stamped on it the "starting time." In the lower clip will be placed the dispatch order for the "next job" which the operator is to work upon. It is the duty of the dispatch clerk to see that this lower clip on the boards at every machine or work-place is provided with a dispatch order before the order in the upper clip has been com- pleted. When an operator completes a job he removes the dispatch orders from the upper and lower clips, proceeds to the dispatch clerk's desk and, calling out his clock number and his machine or work-place number, passes in both dispatch orders to the dis- patch clerk. The dispatch clerk stamps the "stopping time" on the dis- patch order which has been completed and places same in a "completed" file on his desk. He then stamps the "starting time" on the second dispatch order and returns it to the operator, who, upon returning to his machine or work- 174 Fig. 1. Scene in a Shup Where Traditional Methods of Maxai.kiient Prevail Fig. 2. Foreman, Under "Patrolling Supervision" System, Checking Work "PATROLLING SUPERVISION" 175 place, places it under the upper clip of the machine or work- place board. The dispatch clerk then proceeds to get the dispatch order for the job which is to follow the one on which the operator has just started, into the lower clip of the machine or work-place board. This preparation will include: (a) Prompt movmg of material to the machine or work- place; (b) Prompt delivery of tools, jigs, and fixtures required; (c) Prompt delivery of the order, drawing, and instruction card for the "next job." When this has been done the operator is able to consider the "how" of doing the "next job" before he is ready actually to start the work. TRADITIONAL SUPERVISION In the shop operating under traditional methods the foreman spends a large part of his time in plannmg the work to be done; determining how it shall be done; routing it to certain machines and certain operators; interviewing and selecting applicants for employment; establishing the speeds and feeds to be used in doing the work; setting the piece rates; and doing a large amount of clerical work in addition to the foregoing duties. For much of this work he is seldom fitted and he carries it on in a " hit-or-miss "—generally "miss"— manner. Men are running out of jobs and are chasing around the department after the foreman to get their next job, or they are content to "loaf" until the foreman can get to them and assign them some- thing to do. In Fig. 1 is shown the foreman in a plant which was being operated under traditional methods of management. During the time that the foreman is selecting the job and startmg one of his men on the work, three other men are waiting for his at- tention for the same purpose. The losses of time from this condition of affairs are real and apparent, as will be seen from a study of this illustration. In "managing for maximum production" one of the first steps taken when production-control plans are considered is the 176 INSTRUCTIONS AND SUPERVISION separation of the preparation from the execution section of the work. In making this separation, many of the duties which had formerly been handled by the foreman are assigned to the planning department and the foreman's time becomes available for the more important duties of his position; duties which he is best qualified to perform by reason of his special training and experience. When this separation of preparation and execution has been brought about, the foreman finds that he has been relieved of a large part of his daily routine work. In fact, he feels many times that his main duties have been taken away from him and that his job is being gradually narrowed down and may even- tually disappear in the near future. Then it is that he must be taught that the real duties of his position are left for him; that these duties are of the utmost importance; that they are the very duties he has not had suf- ficient time for before; and that they are the duties he is best qualified to perform in such a manner as will insure his department making the best possible showing and which will, if carefully carried out, place him in line for further advancement. It has been found best to teach the foreman his new duties in a systematic manner and to plan for him a definite schedule for patrolling his department at regular and frequent intervals. By so doing his supervision is given to all matters as they affect each worker. This we have designated by the term " Patrolling Supervision." Under this plan of supervision and during the scheduled trips of the foreman through his department he will closely observe each worker; note the quality of work being turned out; will in- struct the workers as to what must be done to remedy defective work; what may be done to insure meeting the standard time set and gaining the bonus or premium; and will listen to all com- plaints and suggestions that his workmen may make. The Standard Practice Instructions covering the duties of the department foreman under the "Patrolling Supervision " plan, as they have been applied and successfully operated in one large plant, are shown on page 169, 1 H >* - is 1 1 i . Hi i\i r J i f •-^•^-^^^ L-#^ _.. 1 Fig. 3. Factory Superesttendent — Blackmer & Post Pipe Co. — Ringing Clock at Station in Pyrometer Room Cards on wall show standard and actual temperatures of kilns in operation. Chart placed on wall and shown over superintendent'.s shoulder is a standard temperature curve of kiln burning on 2A" pipe, placed there for instruction purposes PATROLLING SUPERVISION" 177 As shown in the illustration, Fig. 2, the foreman is checking up the work of a bench operator. The part which he checked and approved on his previous visit is seen lying on the bench in the foreground. When the part which is now being checked is found correct and has been marked, this part will be used as the FORM LVE. F8E ^ INSTRUCTION CARD — r^-. Sheets. Sheet &*. OPERATION TOOLS FEED IN.PERMIN SPEED R.P.M TIME 1 UNIT LOT ] 1 ' L ^ ~- ■ 1= WHEN WORK CANNOT BE DONE AS SHOWN REPORT TO MAN WHO SIGNED THIS CAR SIGNED D ». 1 i -< § 3 X o g o ■2. O •n 1 SKETCH :- 8 > i 5 ■3. o v Fig. 4. Instruction Cabd for Operator sample until the foreman's next visit. Due to regular and in- telligent supervision during the time that the work is being pro- duced, spoilage of work is reduced to a minimum under this plan. In the illustration. Fig. 3, is shown the department head in a large plant producing ceramic products in the act of recording his visit to one of the stations on his schedule. He has checked up the cards on the wall of the pyrometer room, found conditions up to the standard, and is "ringing the clock" in the same manner as the watchman does in making his rounds. With the adoption of the plan of "Patrolling Supervision" comes a new attitude on the part of the operator toward his work. He is gradually trained to think of what he is going to do next and does not wait until he is ready to take up the next 178 INSTRUCTIONS AND SUPERVISION step before studying ways and means to do his work in the best way. The Instruction Card, a copy of which is shown in Fig. 4, is the means used to instruct the operator in the standard or "one best way" for doing the work he is to perform. Only through following this Instruction Card can any progress be made toward that standardization which is aimed at for the accomplishment of the schedules. This Instruction Card is made out as the result of detailed time-study and analysis of the performance of each operation and represents the standard upon which the incentive wage- payment plan is based. Trouble is encountered when Instruction Cards are intro- duced unless it is carefully and thoroughly explained to both gang leaders and workmen that their introduction is not for the purpose of suppressing initiative and thought on the part of the operators, but rather, to set up a "mark" which they should at least approach, if not surpass. In Fig. 5 is shown the operator of a hand screw machine in a plant where the "patrolling supervision" plan is in operation and where the Instruction-Card feature has been introduced, together with an incentive wage-payment plan. The two dispatch-order time cards will be noted in the board directly over the machine and the operator will be seen studying the Instruction Card covering the next job which he is to do, while finishing up the job he has in process. In this shop under traditional methods the operator did not have the opportunity to give any attention to his next job be- fore he had finished the job in process, as he did not know what this "next job" was to be until it was given him after the first one had been completed. Under the new methods the operator is always provided with his "next job" in advance and, with a proper plan of wage payment in operation, he is constantly on the lookout to im- prove his methods, reduce his time, and increase his earnings. Lack of sufficient and coordinated supervision and a total absence of a plan for instructing the operators — seeing that they understand the instructions that are given them — charac- Fig. o. Operator Studying Next Job erom Instruction Card "PATROLLING SUPERVISION" 179 terize those plants where "managing for maximum production " is unknown. In the larger plants the foreman's attention must be so con- stantly directed to the matter of increased production that he has but little time to give to the subject of instructing his workmen. This is especially true in those cases where the employees are recruited from unskilled and low-priced labor, a type of labor which demands both the largest amount of supervision and the most careful and detailed instruction if it is to prove profitable. Very often it is found desirable to separate the function of instruction from that of supervision, placing the former in the hands of some of the best men and assigning a limited number of operators to them to instruct. In doing this, however, care must be exercised to avoid possibilities of any friction de- veloping between the foremen, the instructor, and the workmen. If all three parties fully understand that the arrangement is for their best interests, as well as for the interest of the com- pany, there is little danger of trouble from this source. The first installation of "patrolling supervision," made under the writer's direction, was in a wood-working plant where the standards had been set very high, where conditions had been developed to a high degree of efficiency, and where savings were difficult to make. The quality of the product had to be more than insured; it had to be made better and at the same time a larger production had to be obtained with a reduction in the cost of production. As a result of the adoption of the plan in this plant, the quality of the product was materially improved; the standards were regularly and constantly attained; the employees where paid an increase in wages amounting to from 10 to 15 per cent. ; and the direct labor-unit cost was reduced approximately 15 per cent. In another plant, making a totally different product, before the installation of the plan of "patrolling supervision" the out- put was 4,600 tons per month, at a cost of $5.85 per ton. As a result of investigation and standardization of conditions, the standard output was set at 5,000 tons per month. At the end of the first month's operation of "patrolling supervision" the 180 INSTRUCTIONS AND SUPERVISION output had been brought up to 5,600 tons per month and the cost was decreased to $4.60 per ton, a saving of approximately 22 per cent. In both of the foregoing cases this gain was made permanent only through the adoption of intensive supervision, which was given on the patrolling plan. COMPARISON OF TYPES OF SUPERVISION Traditional f or emanship. Under traditional foremanship the foreman handles as many workers as possible, giving each worker his next job when the last one is completed and leaves the "what and how" largely to the worker. If the instructions given by the foreman to the worker are not clear, the worker looks up the foreman for further instructions, the work being stopped until sufficient information is given to the worker to proceed. It is left to the workman to select the tools which he is to use; to determine the best method for doing the work; to arrange a feed and speed combination — through trial and error — that will permit doing the work; and to bring the job through to the best of his ability. If mistakes are made in the set-up of the tools and incorrect work is produced, it is only found when the parts are sent to the inspection department for the final checking when the job is finished — too late to be corrected. A uniform high quality of work, combined with the maximum quantity, is impossible and the costs of the work produced fluctuate widely. The losses from spoiled work are always excessive. Functional foremanship. Under the functional plan of fore- manship a number of foremen — usually eight — are brought into direct contact with the workers. Each foreman is a specialist in the function he performs and he confines his attention to this function only. While it is recognized that the several qualifications which are developed in the different foremen under functional manage- ment are seldom found in any one individual, the plan, as it has been advocated, has seldom been found possible of applica- "PATROLLING SUPERVISION" 181 tion, because of disturbance of the human factor in dealing with a number of bosses. A modified functional foremanship plan, where certain quah- fications are developed in one gang boss, and with the prepara- tion work handled by the personnel of the planning department and the employment and discipline of the workers handled through the employment department, has frequently been in- troduced with decided success. "Patrolling supervision." In many industries the cost of inspection, if the inspection operation is performed after the work is completed at each step in its various stages, reaches a considerable sum. In some lines of manufacture it is considered essential that this inspection be carried out on each part after the performance of each operation. In the large majority of industries, however, it is only necessary that the inspection be done after a lot of parts have been completed on any one operation, or after a certain group of these operations has been completed. With the adoption of the " patrolling-supervision " plan it is very often found possible to save a large amount of the inspec- tion cost, at the same time improving the quality and reducing the losses from spoiled work. Where the inspection is not performed until after the work is done, mistakes and bad work cannot be corrected on that lot. The only correction that can be applied is to throw out the bad work and "get after" the foreman to prevent its recurrence. "Patrolling supervision" places the responsibility for good work upon the foreman and shows him how to get it — during the time the work is being done — as well as bringing the workers into a closer touch with the management through their system- atic and direct contact with the foreman. In one plant where this plan was largely introduced from the inspection standpoint, the cost of inspection of the product was reduced nearly $25,000 per year, directly due to the possibilities of correcting defective work before it had progressed too far, and training each worker systematically in the standards of workmanship which had to be maintained. ANALYSIS Improving Shop Methods by Analysis IMPROVING SHOP METHODS BY ANALYSIS BY L. V. ESTES A NALYSIS is a catch word that is frequently on the /\ tongues of those who are trying to solve the problems ±\. of the present-day business world. It is a word too often misused to convey the idea that it is in some way the solu- tion of many difficulties. Nevertheless, this is not the case, tor it is not in itself a means of overcoming troubles. The careful analysis of a problem, however, is the first step toward its solu- tion This word has a very definite significance, and before considering the proposition which is before us, it would be well to make sure that its meaning is completely understood. Analy- sis is nothing more or less than the separation of a thmg, a proposition, a problem into its component parts, the orderly classification of those parts or elements, and their thorough examination. When we speak of scientific analysis, we mean that this separation is done with painstaking attention to detail, that the various elements are carefully weighed or meas- ured, and the relations between them are defined with dis- tinctness. Analysis is the preparation for future constructive work; it gives us the material with which to build. From the various elements that analysis presents for our consideration we can pick the ones which we wish to use. We can see just what their relationship has been to all the other elements in the past, and so be able to avoid combinations in the future that will fail to give us the results we desire. Without analysis of the problem which is before us our approach to it is blind, and we can only follow empirical rules which are almost as likely to lead us astray as to conduct us to the desired end. Analysis, therefore, while not in itself constructive, is the basis, the foundation on which our structure is built, and only as we have carefully analyzed the problem before us can we hope to build a lasting edifice. 185 186 ANALYSIS FRUITS OF ANALYSIS The leaders in tlie business world have already begun to study and analyze their problems and the first fruits of their efforts have been realized. The result of their analysis has been to break up the large problem which is before them into a number of lesser problems which in turn need the same sort of treatment as the principal proposition has received. Because the selling side of the industrial world has perforce drawn on men who are articulate and who are trained to express themselves with ease and vigor, the claims to the distributing side of business have received more attention and consideration than the production side, whose executives have been primarily doers and not talkers. This is in spite of the fact that the men in charge of the selling side of the business have relied on personality rather than on facts as revealed by analysis. Hence, the factory has not received the attention that it has needed for it has not been able to present its side of the case with such cogency as the sell- ing side. Now the time has come when the factory is beginning to come to its own and to receive the thoughtful study that it deserves. Since the men who are attacking its problems are in large measure the men with an engineering training, the work which they are doing is being done with an accuracy and care which are making the results of special worth. MOST FACTORY EXECUTIVES ARE ENGINEERS The fact that most of the men who have been working on the factory problems have been engineers, has made it per- fectly natural that they should first study the problems that are nearest to their profession. So we find that much progress has been made in solving the shop problems along the line of time- studies and the related subjects of speeds and feeds, the com- position of tool steels, the shape of tools, the design of new and automatic machines, and other kindred subjects. Scientific management has been developed, and as a part of its work it has done much to obtain control of the material, the orders, and the sequence of operations — in short, the planning of the work to be done. IMPROVING SHOP METHODS BY ANALYSIS 187 The demand for new and convenient articles by the American public has stimulated the inventive genius of the American de- signer so that new ideas are constantly taking on concrete form and being presented to the public. The analysis of all these phases of the problem of production bear on the problem of the shop, but in most cases they have been approached from some other point of view than that of the shop itself. We want to show in this article how the analysis of these and other similar problems from the standpoint of the shop can greatly benefit the shop and help it render its most efficient service to the busi- ness of which it is part, and hence, to the general public which the business is trying to serve. KNOWLEDGE OF THE PRODUCT IS FUNDAMENTAL The first step toward an understanding of shop methods and hence toward their improvement is a thorough knowledge of the product that is being manufactured. It is the first element that should be analyzed in the work of improving shop methods. It is almost self-evident that a knowledge of the purpose for which an article is made and the way it is put together is an essential for a complete and adequate comprehension of the processes involved in its manufacture, and yet there are many, perhaps it would be truthful to say most, shops in which the men do not have any real comprehension of the "why" and "how" of the product they are working on. It is not simply the men at the machines who do not know these details, for in the highly subdivided state of the processes of modern industry it could hardly be expected that they would. The foremen and even the superintendents sometimes do not have a real under- standing of the product that they are turning out. The analysis of an article is really a study of how it is made and why it is put together in that particular fashion. The first consideration in designing a product is so to construct it that it shall render the intended service to the customer. Unless this condition is fulfilled, all other desirable points that it may have are worthless. To give satisfactory service the article must be planned to meet the conditions of service to which it will be sub- jected. Farm machinery, for example, must be made strong 188 ANALYSIS and rugged, but a great deal of attention need not be given to the accuracy of the parts. The product must be designed to have sufficient strength without too much weight, except in the cases where weight is desirable to give stability to the article, as is the case in the bed of an engine. This balance between weight and strength is one of the important elements to be con- sidered in designing any article. It is one that has material bearing on the shop methods used, for weight is an important factor in the moving and handling of parts in the course of manufacture. EASE OF REPAIR MUST BE CONSIDERED Perhaps the most neglected element in the design of an article, so far as the customer is concerned, is attention on the part of the designer to the ease with which necessary repairs may be made. In spite of all that may be done to assure strength and stability to the product, there are inevitably cases where repairs are necessary. It should be possible to make these without having to take the whole article to pieces or to send it to the fac- tory. Most important of all is to have the article so designed that the ordinary care that it needs may be given it without too much trouble. A good instance of a bad example is the case of a certain farm tractor that is so designed that it is necessary to remove the gasoline tank in order to grind the valves. Such an example as this is due either to great carelessness on the part of the de- signer, or else to a complete failure on his part to really analyze the question of design from the standpoint of the customer who is the man who pays the bills, and who makes or breaks the company in the long run. A careful analysis of the purpose for which the article is destined, and the conditions under which it is to be operated should have eliminated such difficulties at the start. Such an analysis is necessary as a basis for the fur- ther study of the product from the point of view of its manufac- ture in the shop. ECONOMY OF MANUFACTURE When the product has been analyzed from the point of view of its service to the customer, the next step and the one in IMPROVING SHOP METHODS BY ANALYSIS 189 which the shop is most vitally interested is its analysis from the standpoint of economy of manufacture. Usually the posi- tion of the customer receives some consideration at the hands of the designer, but all too frequently — unless the designer is a man who has had shop experience — the economy of manufac- ture and the convenience of the shop are largely neglected. STANDARDIZATION OF PARTS It is very much to the interest of the economy of manufacture and ease of production in the shop to have all the parts standard- ized as far as possible. Nothing is more trying to the men in the shop than to find that they are held up because some little part like the screw or bolt is lacking and that some time must elapse before it can be secured because it happens to be a special screw or bolt. In the great majority of cases it will be found on investigation that some standard screw, which could easily be bought on the open market at any time, would have done just as well if the designer had only decided to use it instead of employing the special part which happened at the time to suit his particular fancy. Not only will analysis of the product show that standard articles may be used in its manufacture to a large extent, but also that their number may be kept within narrow limits by careful thought in planning the product. The resulting im- provement in the shop will be felt in two ways — the absence of delays due to the lack of some small special part, and the ease and economy of manufacture in making up large quantities of a standard part at one time. The standardization of such small articles that are common to many industries must be carried to the limit, and this may easily be done if the product is systematically analyzed before it is designed. STANDARDIZATION OF PARTS PECULIAR TO A PARTICULAR BUSINESS Each business has a product some of whose parts are peculiar to it and which are not used outside of its line, or frequently, however, careful analysis of the product will reveal the fact that there are many parts that may be used on many different 190 ANALYSIS models, and which, for the business in question, may be fully standardized. A certain manufacturer of the Corliss engine has shown how this may be done to the great advantage of both himself and his customer. The demands for different types and kinds of engines are almost as numerous as the orders re- ceived. This manufacturer has designed certain standard parts, such as the bed, the cylinders, the fly-wheels. If the or- der comes for an engine to develop a certain horsepower with low-pressure steam, the manufacturer can make a selection from among his standard beds, cylinders, and fly-wheels, and get the right combination at once. If the order comes for the same horsepower, but to be developed by the use of high- pressure steam, he would use the same bed and fly-wheel but simply change the cylinders. This simplicity of construction is the result of careful analysis of the problem that was before the company. Not only does the customer get better and much quicker service as a result, but in addition such a type of manufacture greatly simplifies the work of the shop and the methods that are employed there. Production is standardized and made regular. The business becomes a manufacturing proposition instead of a jobbing con- cern, and all the benefits to the shop of manufacturing a regular product over doing a jobbing business are obtained. The rush and hurry, the forgetting and lack of ability to keep promises, all are greatly reduced when work becomes in large measure a matter of producing parts for stock. Any simplicity that may be obtained without sacrificing other important things is a di- rect gain. FAULTS IN DESIGN Analysis of the product will also show that parts have been giving trouble either during the course of manufacture or to the customer in the use of the article. These parts should be eliminated and satisfactory ones substituted. It is a serious hindrance to the work of the shop to be obliged to fabricate parts whose delicacy makes them subject to breakage. The manufacturer of an automobile designed an engine on which, as is frequently the case, the water connection was bolted di- IMPROVING SHOP METHODS BY ANALYSIS 191 rectly to the cylinder head casting. The flange on this cyHnder head casting was made so light that in handhng during manu- facture and in bolting the water connection to it, many of these flanges were broken, and as a result the whole cylinder head casting block had to be scrapped. It is equally embarrassing to have to constantly interrupt the ordinary course of manu- facture to make up large quantities of repair parts. Careful analysis will result in the ehmination of such parts from the product already being manufactured and will prevent them from creeping in as standard elements of the articles that are being newly designed. CHOICE OF MATERIAL Analysis of the product will further offer the possibihty of getting along without the use of material that is either difficult to obtain in the market or is difficult to process in the shop. It is a distinct benefit to the shop when it is possible to substi- tute easily worked metals for ones that are refractory. The expense and difficulty of working platinum has resulted in the developing of a new alloy whose basis is gold, called "white gold," which has almost the same appearance as platinum, which is less expensive and far easier to manipulate. It is also a very important advantage to the shop if it is not dependent on the use of a material which not infrequently results in the work being held up for lack of that material. Improvement in shop methods by careful study of the pro- duct is most closely touched when the design of the article for ease in manufacture is considered. Analysis will show the way to greatly facihtate methods of moving and working upon the material in the shop. The product should be designed to be easily held in the jigs and fixtures which may be used in con- nection with its processing. Very frequently some very simple change in design, the addition of a holding boss, for example, will make a great deal of difference in the ease with which the workman may do his task, and in the expense of accomplishing the work. Innumerable instances may easily be found to illus- trate how lack of thought on the part of the designer has re- sulted in greatly increased toil and expense in the shop. 192 ANALYSIS Take the ease of an automobile engine which was designed to use drilled holes for lubrication instead of tubes. It was found on examination that these holes had in certain instances to be drilled at compound angles. In one case it was discovered that one hole had to be drilled five inches deep at a compound angle to meet another hole drilled three inches deep also drilled at another and different compound angle. Any shop man will recognize instantly the difficulties presented and will appreciate the care involved in correctly performing this operation. Another instance will be all that space allows discussion of in this paper. A water-circulating pump was designed to be formed in halves in such a way that machining to four accurate dimensions was required when a slight change in the design would have permitted the pump to be made in halves as before but with only one accurate dimension replacing the four to be machined. SPECIAL EQUIPMENT Work in the shop may be greatly simplified if the product is so planned that special machines are not needed for its manufac- ture. Frequently slight changes in design will permit the use of standard machines instead of requiring the design and making or purchase of special equipment. It must be borne in mind, however, that ease and efficiency of manufacture must not be sacrificed for the sake of using standard equipment, for often the economy of manufacture depends on the use of special machinery. On the other hand, there are too many small shops that are engaged in making some line of product a demand for which is very likely to be temporary and for which they design special machines only to find in a short time that the special machines are useless and that the large sums of money which they have cost have been practically wasted. A motor car manufacturer had a special boring machine for boring the cylinders in a four-cylinder engine block. The following year, he brought out a six-cylinder motor, expect- ing to bore the cylinders on the same boring machine. He dis- covered, however, after the engine was completely designed, that the minimum distance between the centers of the heads of IMPROVING SHOP METHODS BY ANALYSIS 193 the boring machine was greater than the distance between the centers of the cyhnders of the new engine. Judgment is re- quired in cases like this, but in any event a careful analysis of the product from the point of view of the desirability of special machines will furnish a basis for judgment and so make the de- cision something more than a wild guess. Almost as a corollary is the necessity to analyze the product to see if, in its manufacture, special tools are needed or may be dispensed with. Special tools are always a great expense, and delays in their production are almost always the rule. The satisfactory operation of the shop will be materially promoted by the elimination of special tools whenever possible. Once more the relative importance of the use of special tools or the making of the product without their use must be weighed, keep- ing in mind the fact that other factors than the design of the product, such as the quantity to be manufactured, must be considered. None of these other elements can be thought about, however, unless the possibility of using standard tools has been ascertained, and since this fact is dependent in many cases on the design of the product, it can be determined only by its analysis from this point of view. USE OF STANDARDIZED PROCESSES Analysis of the product should be made to ascertain whether or not it is possible that the article be made according to the standard processes employed in the factory. This is very im- portant from the point of view of the shop and its methods. If it is found that the article may be assembled and that all of the parts for the assembly are either standard or can be made according to the usual methods, the work can be handled much more easily than if it is necessary to plan and follow new methods. By using standard methods, unit time-studies may be used to advantage, and the work of setting rates, establishing standard times for operations, and the coordinating of the work in the shop may all be greatly facilitated. In addition, standard routing may be followed, and the procedure of the shop stand- ardized with resulting ease and control of the work, and de- 194 ANALYSIS creased cost of production. A manufacturer turned out a device made in various sizes and contained in a metal box whose cover was formed by drawing the sheet steel in a punch press. It was possible to make the covers of the smaller size boxes with one drawing, but, for a long time, it was necessary to draw the large-size covers twice in order to properly form them. A slight change in design and a httle difference in the steel made possible the forming of the larger covers by one draw- ing in the same way that the smaller covers were made, and so standardized the routing. Finally analysis of the product should result iu the product being so designed that it may be easily and quickly assembled, knocked down for shipment, and reassembled at the place of business of the customer. It may be seen from this discussion that the analysis of the product is the first manner in which the principle of analysis may be employed to aid in the improve- ment of shop methods. Not only will such analysis prove of direct worth to the shop but it will also prove to be of value to other parts of the company's business. ANALYSIS OF MACHINERY After the product has been studied in a painstaking manner, and the results recorded that they may be available for future use, it is next desirable to analyze some of the other factors iu the shop, and the most logical place to begin is with the machine on which the work of production is to be carried on. Pro- duction centers would be a better word than machines, for it does not make any difference, so far as the principle of analysis is concerned, whether the processes are carried on by what is commonly known as a machine, or whether it makes use of vats, ovens, or some other equipment. Analysis of the work to be done and the conditions in the shop will determine what the really necessary machines and equip- ment are. Frequently it will be possible to perform a certain operation on two different machines, and it will be necessary to choose between them. Much will depend on the kind of work that is usually performed by the company. In a shop doing a jobbing business, it is especially important that the IMPROVING SHOP METHODS BY ANALYSIS 195 work of the shop be analyzed and the right selection of machines be made. In a shop of that character, the work that comes is of a very wide variety, and the shop must be equipped to handle it. At the same time, it must not be loaded with machinery that it has occasion to use only infrequently. On the other hand, in the shop where the production is on a large scale, and the product is manufactured with little or no change in design over long periods, the question of machinery is rather one of selecting or designing the right kind of special machines. Building special machines is an expensive proposi- tion and must be done with the greatest care. Sometimes a careful study of a situation and a little ingenuity will save a com- pany heavy capital expenditure. A truck manufacturer was on the point of ordering the construction of a special machine, whose cost was estimated at over $1,000 for the machining of a ball-and-socket joint for a radius rod. His proposition was analyzed by an engineer who worked out a much less expensive method. This engineer found a lathe, which had been practi- cally discarded, and designed some special tools for use with this machine which cost only $200 and which allowed the ma- chining to be done as cheaply as it had been hoped to accomplish it on the special machine. Analysis of the work will show what are the probable limits of the changes which the equipment will be obliged to accommodate and, with this in mind, the machines may be designed with the assurance that there is every prospect of their fulfilling the needs of the company. In the twilight zone between these two classes comes the work where quantity involved is such that it is difficult to decide whether or not it is worth while to build special machines. These special machines would do the work when working more economically than standard machines but, of necessity, would lie idle a certain part of the time. Standard machines, on the other hand, would not do the work so inexpensively, but would be running almost continually. This is the class of work that requires the most careful analysis and that will reward the work involved most richly. Since the details of shop methods will depend in large measure on the kind of machines that are used, it is very important that this step in the consideration 196 ANALYSIS of the problem of the shop receive thorough and painstaking attention, ANALYSIS OF TOOLS One always thinks of tools in connection with the machines in which they are used. There is hardly any subject that is of more vital importance to the smooth functioning of the shop than the question of tools. It is a matter that has not received the careful attention in the past, with few conspicuous excep- tions, that it has deserved. It has often been the custom to think of the work of the tool-maker as something that is not subject to the same scientific control that we have come to think of as the necessary accompaniment of a well-regulated shop, and yet there is no fundamental reason why this should be so. The designing and making of tools is subject to the same control that a similar product made in the shop is amenable to. The reason why the tool-maker and designer have been con- sidered in a class apart is the fact that little or no time and energy has been given to the consideration of the design and especially to the making of tools. Analysis of the tool problem will show that much can be done toward control. During the past war, when tool-makers were almost unobtainable, a certain concern was forced to give the matter the attention that it de- served and as the result of its analysis of their problem, it was found that it did not need skilled tool-makers to run the ma- chines that produced the tools, any more than skilled machin- ists were needed in the shops to tend the ordinary machines. Resolving the problem into its elements and the putting of those elements together in logical sequence was the means for attaining this result. In modern industry the tools are very important, for the whole matter of interchangeability of parts and quantity manu- facture depends in large measure on their correct fabrication. No work can proceed till the tools are designed, and designed correctly. This was also proved very conspicuously during this past war when many a manufacturer found that his work was held up and his plans deranged, his contracts cancelled and his profits lost because he did not know and understand the problem IMPROVING SHOP METHODS BY ANALYSIS 197 which the design and manufacture of his tools presented to him. This was due simply and solely to the fact that there were very few manufacturers who had ever really analyzed the problem. QUANTITY OF PRODUCT TO BE MADE One of the fundamental questions which must be settled before the design of tools begins is that of quantity production. It brings up the same question that has been discussed in the case of machines; for the need and desirability of special tools depends on the quantity of the manufactured goods that the factory expects to turn out at one time. If the quantity is to be small, the desirability of employing only standard tools is greatly increased even though it may increase the cost of manu- facture, for it is highly unwise to tie up a large amount of capi- tal in tools that will probably be used only once. Only analysis of the work that the shop is expected to do will furnish a basis for an adequate judgment on this matter. SHOP LAYOUT "When once the question of what machines are to be used and the tools which are to be employed in them are settled, the next problem to be analyzed is their location in the shop. This question of the location of the various machines in the shop is a matter of great consequence in the endeavor to obtain the maximum benefit from their possession. Analysis of the rout- ing of the work through the factory is the basis for satisfactory shop layout. As in the other phases of the application of analy- sis to improvement of shop methods, we find that here there are two extremes. There is the jobbing shop where each job has to be routed and planned on its own merits, and the con- tinuous process shop where each day is just like every other day so far as the course of the work is concerned. In a jobbing shop, a careful consideration of the question of shop layout will indicate that it is generally best to group the machines accord- ing to the types and kinds of machines instead of according to the sequence of operations that are to be performed on the job. This because the sequence of the work is seldom twice the same, 198 ANALYSIS and it is easier to maintain control of the work in the shop if the location of each class of machine is definitely settled upon. The other extreme may be illustrated by an automobile shop which makes one standard style of chassis and only one. Here it is much better to plan the work so that it will never have to double back on its course but always move in a "straight line." In this instance the machines should be located so that the work may be performed on each article without the necessity of that article leaving the beaten track. This will mean that drills may be found in half a dozen different departments of the shop, punch-presses may be located on two or three different floors, and work-benches scattered in every different building. The fundamental principle that must be followed in all these cases is, that the material must not be carried back on its own track. A careful study of the conditions that the factory in question has to meet will give a basis for the correct solution of the problem of where to locate the machines. INSPECTION There is one element that is frequently neglected when the analysis of the conditions determining layout of the shop is made, namely, that of inspection. If inspection of parts be- tween operations is necessary, provision must be made for it. Care must be taken to see that it does not involve too much handling or moving of the material, and at the same time that too much of the factory floor space is not occupied with inspec- tion space. This question of inspection is one that will be dealt with more fully in the following article, but it should not be forgotten in connection with the problem of shop layout. Space has permitted the discussion of only a few of the many phases of the shop and its methods that should be ana- lyzed if the work of the shop is really to be thoroughly and fun- damentally improved. Much surface improvement may be made without a complete and thorough analysis but it will be only surface improvement. The kind of betterment of shop methods, or of anything else for that matter, depends on the painstaking study of what is under consideration, and the ob- taiaing of complete and comprehensive information which IMPROVING SHOP METHODS BY ANALYSIS 199 such a thorough investigation of the subject involves. As was stated in the first portion of this present article, analysis is the preparation for constructive work. The more thorough this preparation is made the more lasting will be the structure that is erected. The shop is in need of just the sort of careful thought as has been described in this article. Its methods are susceptible to great improvement as candid shop men will frankly admit, and the first step to be taken toward their improvement is that of analysis. ANALYSIS OF TECHNICAL PEOCESSES When once the machines and the tools have been analyzed and the desirability of their use and the capabilities which they possess are known, the next step is to study the technical processes which may be carried on in the shop on these machines. A good example for analysis in this connection is a certain metal- working shop. If the technical processes that are carried on there are carefully investigated, it may be seen that they can be divided along certain broad general lines into four main groups — machine-shop work, blacksmithing, sheet-metal work, and pipe-fitting. In this particular shop, these are the four departments which make up the producing sections of the com- pany, the ones which work directly on the saleable product. It will be noted that these departmental divisions follow the lines of the technical processes that are involved. The other departments in the shop are auxiliary and do not operate di- rectly on the saleable article, but aid in its manufacture by rendering service to some or all of the producing departments. The next division of the technical processes in the machine shop may very well follow the lines laid out by the several kinds of machines that are used there, and so the work of this department may be divided into lathe, heavy lathe, special lathe, drill press, planer, shaper, grinder, milling machine work, horizontal boring mill, vertical boring mill work, work on the automatic screw machines, gear cutter, turret lathe, floor and bench work, and tool-making. The work on each of the ma- chines should be further analyzed, as well as the work in the 200 ANALYSIS other producing departments. If this is done we obtain the following results of our analysis, which is most easily presented in tabular form: MACHINE SHOP WORK Lathe Plain turning Threading and mandrel work Chuck and face plate work Advanced work Drill 'press Vertical drill Radial drill Planer Simple work Complicated work Shaper Grinder Tool grinding Surface grinding Automobile work Milling machine Plain milling Universal milling Special milling Horizontal boring mill Heavy lathe Automatic screw machine Forming Boring Threading Vertical boring mill Single tool work Compound tool work Surfacing Internal work External work Gear cutter Bevel gears Spur gears Helical gears Worm gears Intermittent gears Internal gears Turret lathe Depending on the combina- tion of tools used Floor and bench work Bench work Babbitting Tap and die work Riveting and peening Tool making General tool-making Testing Fundamentals Steel work Steel welding BLACKSMITHING IMPROVING SHOP METHODS BY ANALYSIS 201 SHEET-METAL WORK Forming Soldering Brazing Sheet-metal pattern cutting PIPE-FITTING Pipe-Fitting This gives a more or less complete analysis of the various processes that are performed in this particular shop, and with this information at hand, it is possible to approach the work of the factory with definite conceptions of what is going on there. DETAILED ANALYSIS OF OPERATIONS The study of the various technical processes has divided the work up among the various machines upon which it is performed, and now comes the problem of finding out exactly how it is done as a basis for deciding and how it should be done on these different machines. In other words, the analysis in detail of the operations that are performed on the several machines must be made. The first thing to do is to break up the operations on the machines into the divisions that may be made by the observer who studies the matter objectively. This will show up the sequence of the sub-operations as they are actually per- formed at that particular time and will point out which sub- operations are superfluous, and where losses in time exist and wastes of material occur. This investigation is qualitative in its nature and shows what exists, whether it is good, bad, or indifferent. Such an analysis is only partial, however, and is not as complete and painstaking as it ought to be. It is the first step toward the goal, but there is another step to take before the analysis of the operation is complete, and the in- formation is at hand that is needed to make possible improved methods in the shop. QUANTITATIVE MEASUREMENT OF OPERATIONS The next part of the study of the operation is the quantitative measurement of the various elements that our qualitative analy- 202 ANALYSIS sis has brought to Kght. It is at this point that the most careful analysis by engineers and shop men has been done. The originator of scientific management began along this line the investigations which brought him to the front rank in both the scientific and managerial field of industrial effort. He wanted not only to know what "made the wheels go round," but he also insisted on knowing how fast they turned. In other words, he began to make time-studies. It was the beginning of the movement that has done more for the shop than any other one single thing. The accurate measurement of all the elements that our previous analysis has shown up is to be done by means of the stop-watch. At this point our analysis of the several operations becomes really scientific, and the data that is developed has extended use. The length of time that each sub-operation takes may be determined, and then con- sideration may be given to the question of whether or not it can be performed in less time as a matter of standard practice. The time lost between operations and in the performance of useless operations may be determined. It is equally important to know the amount of time that is wasted in waiting for ma- terial, in waiting for orders, and on account of the break-downs in the machines, as it is to know the amount of time that is wasted in performing the operation itself. In short, the first result from time-study should be to bring the work of the factory under the control of those who are directing it, to cause them not to rely on a driving policy to get increased productioi}, but enable them to lead their men to produce more. The limit to which this time-study should be carried varies with the work that is being done. It should be extended as far as it is economically advantageous. It is not desirable to make elaborate analyses of operations that are not going to be repeated again or which will be repeated only a few times. It is cheaper and hence better manufacturing practice to take a little longer to perform an operation of this kind than it is to spend too much in analyzing it beforehand. It is quite useless to make detailed time-studies of such an operation as repairing an automobile radiator in the ordinary automobile general repair shop. Probably no two radiators IMPROVING SHOP METHODS BY ANALYSIS 203 within a considerable period of time will require the same repair. At the other extreme is the operation which is performed many times a day on many machines by many operators. Such an operation merits the closest analysis with the stop-watch and it may even pay to study the operation with the aid of the moving-picture machine. The various operations in a shoe fac- tory are an example of the class of operations that merit the closest investigation, for many of them are repeated day after day by large groups of employees. The extent to which time- studies should be carried depends on the nature of the work and the good judgment of the person making the studies. It should be remembered in considering this matter that many small gains or losses soon become large. Hence, the more often a certain operation is performed, the more worth while it is to analyze with the utmost care that small wastes may be avoided and small gains increased. COMMON ELEMENTS OF ALL OPERATIONS There are certain elements which should be considered that are common to all operations, both hand and machine. Among such elements is the manner in which the work comes to the production center. It is evident that an operator cannot do his best work at either a machine or work place if the work is not in such shape that he can commence his task without any pre- liminary action. Analysis of the operation should be made with this idea especially in mind, for much of the improvement in shop methods can be traced to the satisfactory solution of this problem. Control of the orders and material in the shop is directly dependent on the analysis of the operations that no delay may occur which is due to the failure of some operation to be done in the time allowed it. THE MACHINE' — THE CONTROLLING FACTOR EST MACHINE OPERATIONS When the analysis of the work that is to be done on machines is considered, it is found that it must be approached from a somewhat different angle from hand operations. The control- 204 ANALYSIS ling factor in the case of machine operations is the machine. Hence the capabilities of the machine should be analyzed first before the methods used by the operator are considered. Of course, all machines have certain limitations of speed and out- put that cannot be exceeded, but a careful study of their func- tioning will often show great chances for improvement. The modern high-speed steel was the direct result of time-studies on certain machine tool operations. It is the machine which must be studied first, and a solution for the problem which it involves, worked out. The manufacturer of certain electrical equipment found that by modifying the construction of the machines on which his coils were wound, he could increase the speed, and hence the productiveness of those machines, about 40 per cent. THE HUMAN FACTOR IN HAND OPERATIONS Hand operations are in need of another sort of analysis. In studying these the human factor is of vital importance. The element of fatigue assumes importance, and the study of the problem should take this element into consideration at once. The several different ways in which the material may be manipu- lated must be ascertained by analysis in order that the way which involves the least fatigue may be found. Closely con- nected with this part of the problem is the determining of the proper amount of rest time and when that rest time should come. Manual dexterity is a very important consideration in studying hand operations, and the analysis of such operations should show how much of the speed which is attained is dependent on the personal qualifications of the operator. THE PLACE OF INSPECTION The place and manner in which the inspection of the product is made must be decided upon in connection with the considera- tion of the operation itself, for the sequence of operations and the place of the various inspections in that sequence depends in some cases on the nature of the operation. In certain in- stances the work of one operation may be inspected as a part of the work of the next operation. In boiler work, the riveting IMPROVING SHOP METHODS BY ANALYSIS 205 may be inspected by the caulkers, whose work follows that of riveting, and so do away with the necessity of inspection by inspectors after the riveting operation. Sometimes analysis will show that inspection of a certain operation is not needed because of the inspection which must necessarily be carried out after some subsequent operation. The analysis of the operations will show what opportunity there is for progressive assembly c^f parts, the subdividing of certain operations and their recombination in such a way as to facilitate their accomplishment. It was careful analysis of the operation of assembly that en- abled Ford to do away with the stall type of assembly and sub- stitute for it the much more efficient chain assembly, a method which has been adopted by many other automobile manufac- turers. ANALYSIS OF WORK TO SHOW TYPE OF EMPLOYEE NEEDED The work at each production center should be analyzed to discover what type of employee is best fitted to do the work. If the work is largely repetitive, if it does not require much strength or technical skill, but does require deftness of touch and delicacy of manipulation, the chances are that women can be used to advantage. If, on the other hand, the work requires strength and skill and involves a long, continuous strain, then probably the use of men will be required. Analysis of the operation will show what kind of employees the company needs in the several departments of the shop. The right selection of the workers is of vital importance, for the success of the work is based on it. Such a selection depends, in the first place, on a knowledge of the tasks which they must perform. The factory may be equipped with the best machines, ade- quately designed for the purpose expected of them; the methods of control of orders, material, and machines may be well de- signed; but if the workers on the machines are not adapted to the work that they are expected to perform, it is evident that the most satisfactory results will not be produced. The work should be analyzed to show what kinds of em- 206 ANALYSIS ployees are best adapted to each operation, machine, or process, and the several kinds should be listed in the order of their de- sirability. This arrangement will permit the choosing of the right type of workers by the employment department, and it will point out to the foreman whether or not he has the right sort of worker to perform the tasks that he is expected to control. The present tendency to employ women wherever possible should be carefully considered. No prejudice against their employment because they have never before done that kind of work should be allowed to interfere with their use. On the other hand, the fact that it is possible to use them and that they are available does not necessarily mean that they will be most efficient in that particular place. A decision should be based on the knowledge of facts that analysis reveals. Analysis of the employees is a corollary of this, but since such analysis is properly the function of the employment depart- ment, only the results of such analysis will be discussed here. When the capabilities of the workers are known they can be put on tasks for which they are adequately fitted by natural ability and training. Small electrical apparatus requires for its manufacture delicacy of touch and patience more than strength or technical training. A certain business found this out by analysis of the several operations and substituted girls of the slender, nervous type for the boys they had previously employed, with greatly increased production as the result. If such cannot be done ideally, at least they may be put on work which they can do and be kept away from jobs for which they are obviously unfitted. The result will be increased out- put, increased ease of control due to the performance of each task within the time limits set, and much greater satisfaction on the part of the employees; for they will be earning their bonuses and will not feel that the work which they are expected to do is beyond their strength and ability. At the present time, really contented employees are a rarity and any means that can be judiciously developed to keep them satisfied should not be neglected. IMPROVING SHOP METHODS BY ANALYSIS 207 FATIGUE FACTORS The various factors that produce the fatigue which workers suffer should also be analyzed. Very frequently, the changes based on such an analysis show remarkable results, for not only is the worker made more comfortable, but for that very reason is more contented, and with the decrease in fatigue, the capacity for productive work is increased. It is simply one of the many instances where the selfish and unselfish sides of the manager's nature may be satisfied at the same time. A prominent indus- trial engineer has made important studies along these lines, and the collection of furniture and aids to comfort on the job that have been made by employees for themselves is very interesting and instructive. It points out the way in which the manager may often at small expense greatly increase the comfort of his employees, for frequently a very simple analysis of this factor of fatigue will provide ample information for action along this line. Before any shop can operate, it must be organized. Most men think of an organization in terms of personalities, and say that because a man is foreman of a department he is therefore the director of that department. The correct way to think of an organization is in terms of functions. If this is done, the concept becomes more like this: because a man is directing a certain department, he is therefore the foreman of that depart- ment. In other words, the shop should be organized by func- tions and not by personalities. When the various functions are accurately defined, then is the time to pick the persons who are to direct those functions. If the personalities of the sort that it is felt are needed are not at hand, the best solution of the problem is to train them up from among those already in the company. If the person chosen for a certain position is not sufficiently well trained to be capable of filling it, the efifort should be made to prepare him for his duties. If the position is not large enough to occupy the capabilities of the man chosen, he can be given two or more functions to direct. This means that his ability to serve the company is not limited by the size of the function that has been 208 ANALYSIS assigned to him. In short, the functions should be defined and then the men selected to fill them. THE DEFINITION OF FUNCTIONS The first step in defining what the various functions in the shop are is to find out what the different elements are that go to make them up, and this can only be done by analyzing the work of the shop. In the average shop the foreman is usually the whole of the directing force. He lays out the work, sees that it is being done approximately as it should be done, teaches the new workers, gives advice and help to those who seek his aid, and perhaps to some others who do not; superintends ma- chine repairs, "bawls the men out" when they infringe any of the written or unwritten rules of the shop, and in general takes all the care and responsibility on his own shoulders. A glance at a typical machine shop, for example, will show that those duties of the foreman can be sub-divided into several principal groups, which we can call functions. These functions might be divided according to their composition among several men. Dr. Taylor made certain groups of functions that he distributed to several foremen, all in the same department, whom he called functional foremen. The gang boss was the man who laid out the work and who saw to it that it came to the production center and the workmen in the way that it should. In doing this he simply followed the order of the work laid out by the planning department. The speed boss decided on the speeds and feeds and the quality of work while the machines were in his charge. The repair boss was responsible for keeping the machines in perfect repair at all times. The disciplinarian saw to it that discipline was maintained at all times. In addition, very fre- quently an instructor was added to teach the new employees in the places where a regular instruction department was not maintained. It is not at all necessary that an effort be made to follow the outlines of the mechanism that has been described above, and it is obvious that in some other kind of a shop than a machine shop such a classification might need some modification. It is necessary to recognize, however, the fact that the work of IMPROVING SHOP METHODS BY ANALYSIS 209 directing a shop should be analyzed and broken up into its com- ponent parts, as a basis for the task of synthesizing those parts into a complete and satisfactory organization. DEPARTMENTAL ORGANIZATION The organization of a department is just as is the organiza- tion of a business, a skeleton, a frame-work for the carrying on of the direction of the work. It is the means through which the control of the department is maintained. It is the way through which the will of the managers of the business is made effective. It should be constructed so as to fill the needs of the department, and this necessitates knowing what the needs of the department are in the terms of functions. This leads to careful study as the basis for the successful building of an organization to fill the requirements. An organization should be put together so that not only will it function and supply the needs of its department, but also so that it will function smoothly, accomplishing what it has to do with facility and making possible complete harmony between the personalities that fill the several positions. THE QUANTITY OF ARTICLE TO BE PRODUCED It is essential that the quantity of the article which is to be made at one time be known before the type of control in the shop can be determined. If the production is continuous with- out any breaks, the methods of control which should be em- ployed will be radically different from those which will be used if the article is to be made once and then perhaps never be produced again. It is perfectly evident that the type of control that is needed for the direction of production of flour in a flour mill is as radically different from the type of control needed in a shipbuilding plant as is the difference in machinery used in those two plants. In the first case we have a product which is being turned out in the same form and almost of the same grade day after day, while in the second case, the common practice has been, down to the time of "fabricated" ships, to build each ship differently from any other. An automobile factory of the "Ford" type is a very different proposition from one of the 210 ANALYSIS "Rolls-Royce" variety. In the former, uniformity of product is the keynote of manufacturing, while in the other, individ- uality is the outstanding feature. Quantity production is the secret of success of the first one, but elegance and beauty are the selling points of the second. The method of control inside the shop depends on the quan- tity of the product which is put through at one time as well as on the total quantity that is made in the course of the year. Analysis is the means of ascertaining the facts in regard to these essentials. Especially in the interrupted and intermittent types of manu- facture it is often found to be desirable to divide the orders which go through the shop into lots or batches. A manufac- turer of electrical fuses had great difficulty in keeping the vari- ous a,mperages separated, for in many cases the only difference between several amperages was the size of the f usable element. Dividing the orders into batches the contents of which were kept together solved this problem for him. In the continuous type of industry this is not needed, for the work is continuous, and in the engineering or jobbing types it is not necessary, for the whole order can usually be operated on at one time. Care- ful study of this problem will show the limitations that the quantity to be produced at one time places on the control of the work by such a means, as well as the desirability of employ- ing such a method. QUANTITY CONTROL This brings up the point of the ways and means for controlling the material as it moves through the shop. In the case of a continuous product industry, such control consists largely in the measure of the quantity of the product that passes by a certain point over a certain period of time. In the engineering type of industry, it is a complicated mechanism that will enable the management to know where each order is at all times and to tell the condition of the shop at a glance. In an automobile factory where chain production is employed, the control of the assembly work is regulated by the speed at which time the chain is moved. In a repair shop, the control is based on careful esti- IMPROVING SHOP METHODS BY ANALYSIS 211 mates of time. The arrangement of the machines in the shop and the place of the inspections in the course of manufacture all have their effect on the methods of production control to be used. THE SHOP IS A FOCUS The whole matter is complicated by the fact that in the shop we have the focus of four factors that unite at that place to accomplish the production of the article in question. The or- ders to do the work, the material that is used in the operation, the machines on which the work is done, and the men who actually perform the operations are all parts of the means that bring the finished product to completion. Each has to be con- trolled, and each in turn is by itself the focus for a part of the system of production control of the whole business. In the shop, at the machine, is the place where they all meet. The work of the shop needs to be most carefully analyzed to interest fully the elements that go to make up this problem, and so pro- vide a satisfactory way for the solution of the problem. QUALITY CONTROL A very important part of the work which is performed in the shop is the inspection of the product, both while in the course of manufacture and after completion. This is done by the men who are producing the goods at the machines and by the special corps of men who are called inspectors. One of the problems which confronted our manufacturers at the com- mencement of the war was the matter of tolerances. They had not been accustomed to the producing of goods to such exact limits on such a large scale. The success of the making of such large quantities of any product to such nice limits is all bound up in the successful making of gages and special measuring tools for the measuring of dimensions. Before gages and special measuring tools can be manufactured, it is necessary to analyze the work which is expected of them. This means a careful and painstaking study of what tolerances and limits are needed. It is not economically wise to employ more accurate dimensions than are actually necessary. In some cases it is positively 212 ANALYSIS unwise to do so. The case of farm machinery is an example. It is frequently left out in the open and becomes rusted. If the dimensions are too close, such exposure sometimes means that its value is partially or wholly destroyed, but if the machining of the parts is not carried to too nice a limit it may still be usable in spite of the damage from exposure, and in almost every case, the damage is repairable. In any case, the analysis of the mat- ter of limits and of the necessary quality of the product which must be attained will provide the necessary data on which to adequately solve the problem which this subject presents. IN CONCLUSION The application of the principle of analysis has been made to some of the problems of the shop. It should be borne in mind that analysis is not a means of correcting evils; it is not a panacea for the ills to which the shop is subject, it is not a solution for the problems which confront the manager or fore- man. It is the basis for attacking the evils by revealing what they are and pointing out the way of approach; it is the diag- nosis of the indisposition that threatens the health of the shop; it furnishes the material for the solution of the problem. Syn- thesis must follow analysis if the results sought are attained. Analysis provides the material and lays the foundation for the edifice of a successful business. Synthesis is the use of the material that analysis provides : it is the building of the structure on the foundation that the analysis has laid. Work, which is not based on accurate and detailed knowledge of the prob- lem and the means for its attack, is inevitably bound to be unsatisfactory and incomplete, if it does not fail altogether. "Well begun is half done," says the old proverb which may be paraphrased most effectively into, "a task thoroughly analyzed is half accomplished." PLANNING AND COORDINATING Planning Department Systems The Shop Order System Coordinating Tool Department Operations Coordinating Inspection with Production Preventing Man and Machine Idleness PLANNING DEPARTMENT SYSTEMS BY JOHN H. VAN DE VENTER A' STRAIGHT line is the shortest distance between two points." Every high-school boy learns to repeat this axiom. If more of them learned to think it, we would have a greater supply of executive ability. For in these short ten words, embodied in every geometry book, is concealed the big secret of success that most of us spend all our lives trying to find. Thinking in straight lines is the secret of thinking success- fully. After the plan is made the execution is easy. So in planning department systems or in passing judgment upon systems that others have planned, the first and big step is to apply to every move that we make the philosophy that is em- bodied in this oft-repeated and oft-forgotten axiom. Let me call attention first to the fact that this axiom pre- supposes two points : Before you can draw your straight line, you must know definitely and accurately where these two points are. You must know your starting point and the objective that you wish to reach. Many people attempt to draw their paths of progress without knowing definitely from where they start or to where they want to go. That is why so many personal and business progress lines are zigzags, spirals, and labyrinths that do not get anywhere. To bring this thought home to designing systems let me tell a story. Keep in mind while reading it that system is the means of handling routine automatically. Neither system nor routine itself are anything more than means to an end. The end is the big thing: it is the objective that we are planning to reach. But to come back to the story : In a certain manufacturing plant, oil was used in large quan- tities for various purposes, including certain processes necessary to production. This oil was stored in a large cylindrical stand- 216 PLANNING AND COORDINATING pipe tank in the yard and was piped to certain points for distri- bution. The daily oil consumption was obtained by adding various meter readings to which were also added the sum total of miscellaneous unmetered deliveries obtained on requisition through the stores department. A perpetual inventory card indicated the amount of oil taken out each day, the amount of new oil put in, and the number of gallons remaining on hand. When this figure reached a certain minimum it was the duty of the stores clerk to make out a requisition for a fresh tank car of oil. Things went smoothly for a month or more after the tank and checking system had been installed; but a day finally came when the oil ceased to flow. The tank was dry. Railway deliveries were slow, oil could not be quickly obtained, and it was necessary to shut down the plant. The general manager, faced with a serious loss of production, made an investigation. The inventory card revealed no errors and indicated a balance on hand well above the minimum. But the empty tank was more eloquent than the inventory card and its fact was indisputable. A physical inspection revealed a leak that led to a sewer. This general manager was a "straight-line" thinker. "The main object of this system is to keep enough oil in that tank," said he, "and your system doesn't include the leaks. We must have one that does." So a float was put in the tank and a pointer, operated by rope and puUey, so placed that it was visible from the purchasing agent's window. "When that pointer gets to the 5,000 gallon mark," said the G. M. to the P. A., "you order another car and see that it gets here. We'll use the tickets and meter readings to check operating costs, but we'll use this system plus a careful inspection of the tank every week, to keep us from getting shut down." So a system which had formerly operated in zigzag paths, from tank to meter readings, from meter readings to inventory card, from inventory card to stockkeeper, and from stockkeeper to purchasing agent, became a straight line from tank to pur- chasing agent, in so far as it related to the big objective of keep- ing the plant running. PLANNING DEPARTMENT SYSTEMS 217 In designing or passing judgment upon a system or any part of it — in other words, in designing or approving of automatic means for taking care of routine — the big thing at every step is to keep the main objective in mind and devise the shortest, simplest, and most effective means to attain it, whether the ob- jective be to keep an oil tank full, to train a new operator, or to get orders out on time. The man who thinks things out on paper has a big advantage over the man who carries out the process entirely within his head. Business and industrial routine is at the best a compli- cated matter and involves a confusing number of conditions, relationships, and contingencies. To attempt to study or pre- sent such relationships other than in graphic form is as diffi- cult as to attempt to visualize the topographical details of a county or township without a map. A part of the self -training of every executive should consist in mapping routing with paper and pencil. It becomes easy after one or two attempts and the habit will enable one to analyze, simplify, and select methods with a certainty and quickness impossible any other way. Map out on paper the routine of the department in which you are most interested, and see how many curved, zigzag, and unneces- sary lines can be omitted. As an example of this method of straight-line thinking. Fig. 1 represents the routine of handling production orders in the foundry department of a machinery manufacturing con- cern. The objective in this case is the complete control of pro- duction with the fewest possible forms, handlings, records, and files. It will be noted that two copies of a single form are sufficient to provide complete control of the work from the pro- duction office through the foundry office, pattern storage, and cleaning room. Each step in the routine is clearly shown and one can follow on the "map" every activity connected with this routine. Unnecessary activities stand out "like a sore finger" when thus depicted and it is easy to secure at every stage the shortest distance between the start and finish of each step. This graphical method of planning routine is not confined to production orders. It is applicable to every sort of routine. 218 PLANNING AND COORDINATING to all sorts of industries or business, and to any number of in- dividuals or departments. The chart. Fig. 2, for example, shows clearly every step concerned in the routine of purchasing. Fig. 1. Planning the Production Obdeb Routine for a Foundry a and b — 2 copies of foundry production order, sent to foundry office. As per lines a, and b. P' — Foundry clerk files copy (a) in tickler according to date required. Q' — Foundry clerk files copy (b) numerically in order number file. p2 — ^When date required arrives, foundry clerk transfers copy (a) to "Work in Process" file. (See travel line a'.) Q* — ^Then he takes copy (b) from "Order Record File" and sends it to Pattern Loft. (See travel line b^.) Q^ — ^Pattern loft attendant selects pattern and sends it to foimdry accompanied by copy (b). (See travel line b'.) Q^ — Foundry foreman assigns work to operator and gives him copy (b), with instructions. Q^ — After running off the order, operator returns copy (b) to foreman who sends it (see travel line b*) to foundry clerk, who files it. (See Q®.) P — On receipt of copy (b) for filing (see next item above) foimdry clerk removes copy (a) from "Work in Process" file and sends it (see travel line a') to Cleaning Room. P* — Cleaning room foreman notes weight and quantity on copy (a) and when castings are delivered to shop, sends copy (a) to shop production office, as notification of completion of order. Summary: Copy (a) travels four times and requires action five times. Copy (b) travels four times and requires action six times. Note: On long runs with partial deliveries, special partial delivery tickets will be required. These will originate with the molder and travel on lines (b*), (w), and (a*). vr 5ft kl liJ Z lU 1 s t 1 u. ?5^ ii^^ 3= llli ' Y 5 -J '^ ^ . . z ^tS if?','': ^^5 I. S 111 ^1 »/> < kj u^ III ^ vn ■< kj p 3^ Si 219 220 PLANNING AND COORDINATING A chart of this sort is understandable at a glance and gets its message to you more quickly and effectively than could be done with many pages of typed descriptions. I call such charts "travel line charts" because they show clearly the lines of travel between starting and stopping points of every step of the routine. There is another variety of graphic Fig. 3. Map of Change of Rate and Transfer Procedure chart also of great value in mapping routine. One of these is shown in Fig. 3 which is reproduced from Mr. C. E. Knoeppel's book "Graphic Production Control." The two types of charts can very well be used together in analyzing or planning systems. For example, Mr. Brinton in PLANNING DEPARTMENT SYSTEMS 221 his "Graphical Presentation of Facts" reproduces the chart shown in Fig. 4 which compares the method of handhng recruit- ing mail in the Adjutant General's Office with the methods ENLISTED MENS DIVISION a: UJ §^ QC UJ ROLLS DIVISION loAQJUTA^NT g ^ GENERAL EXPLANATION it: (X UJ z V- Zi CO i- u. uJ x: O I— z s i ^-> U-l 1 a: UJ <£> UJ > UJ rr UJ X < UJ 2<: CE UJ _1 o z UJ > UJ UJ Q %^ IS a: t UJ —J fc -■ o UJ UJ Z o 2:1 gS t ^ UJ STEPS UNDER PRESENT SYSTEM STEPS UNDER PROPOSED SYSTEM / RECEIVES (^ Z DRAFTS MEMORANDA TSv J TRANSMITS ^ 4 DELIVERS 5 RECElVESrR^NSMiTs ^") 6 RECEIVES ■(7) 7 EXAMINES &I d. DRAFTS REPORT t^ 9 TRANSMITS W 10 REVIEWS ^ X/?) II TRANSMITS Ul2Y JZ DELIVERS (r^ ;== 15 EXAMINES (^ M TRANSMITS ^ — ^ ^(^ 15 DELIVERS -*@ /6 EXAMINES ^^) n INDORSES _^ (>^ =. 18 DELIVERS B APPROVES — ~^ =- W DELIVERS " * The Jones Manufacturing Company Power &. Mining Machinery Chica^o^ Illinoi&,U5.A. Huh tVomUed tnterla. ^ J Cnai'a Order ^-^ Sold to Ship (o ShloVla 1 1 nmiio. 1 1 IH.^»«ll 1 1 ' Egg.Eltail. 1 1 IdlEAiK ' Termtt 1 1 o ««k DCtomioii ■ Shot OrdH- . MuhhM PUIiw'J^iOM - •IL ». X HUB uiNo^jta- '•o" cnscr .■»>. Br."^. ^ "^ Fig. 2. Specialized Oedee Form THE SHOP ORDER SYSTEM 227 found to facilitate following-up, is to assign to each new cus- tomer a number, these numbers being consecutive. This num- ber is followed by a dash and an additional number beginning with 1 for each separate order received from the same customer. The Jones Manufacturing Company, for example, send in their first order which is assigned number 1420. As this is their first order the number given to it by the order department is 1420-1. Later succeeding orders are received from this same customer and the number 1420 is always assigned to it, followed by the number which denotes the quantity of orders which have been received from this customer. By this means it has been found possible to locate quickly any order, as well as to facilitate all reference to any specific customer's work and to pro- vide for developing a proper share of each customer's business. When orders are received by the production division, the first step is to secure from the engineering department the necessary drawings and bills of material covering the product to be pro- duced. Duplicate copies of all drawings must be furnished, one copy to be retained by the planning department for their files and the second copy to be issued with the Work Orders to the factory. As the planning department originates no orders itself and as it requires to know what and how much of each product is to be produced, as well as the kind of product, before it can begin its work, it is essential that this information in the form of au- thorization orders, drawings, bills of material, etc., be furnished at the earliest date possible so that the work may be started in accordance with the schedule laid out. The planning department, responsible to the head of the production division, wUl have full control of all manufacturing activity. It will be solely responsible for the manipulation of material and equipment and the distribution of time and will execute the functions of planning, routing, and scheduling of the work in a manner that will insure satisfactory deliveries to the company's customers or to the finished stockroom. All orders for manufacturing will pass from the order depart- ment of the sales division to the planning department of the production division, where the status of each order received is 228 PLANNING AND COORDINATING determined in relation to material on hand and to be ordered; to other work in process; and to delivery promises already made on other orders. The fundamental principles governing the planning depart- ment in relation to planning, routing, and scheduling are: PLANNING. (a) A knowledge of what to make, the quantities and the time in which to make it. (b) Seeing that each machine, bench, or work-place has a "next job" ready to start before the one in process is completed. (c) Seeing that a Work Order containing all necessary information for the "next job" is at hand and ready for the use of the worker. (d) A knowledge of aU stock on hand and in process, including both raw material and finished parts; of all stock receipts and disbursements, and a prompt checking of requirements against stock records, with maintenance of such stocks as will insure the material and parts being at hand when wanted. (e) Seeing that machines, belts, pulleys, etc., are kept in the best condition and that there is no failure on the part of the operator to "make good" on a job due to de- lays from these causes. Notifying the plant engineer by written order whenever repairs are necessary and antici- pating such repairs as far as possible. ROUTING. (a) Deciding upon the machine, bench, or work-place for each operation and recording these decisions for the use of the order-of-work clerk in handling this order, as well as recording the routing for use on duplicate orders. (b) Selecting other machines, benches, or work-places which may handle the operations in the event that break- downs, delays, etc., may occur at the first place selected. (c) Selecting the best operator for the performance of each of the several operations, within the limits of the personnel employed in the department doing the work. SCHEDULING, (a) Knowing what is to be made and how much of it. (b) Knowing, from time-study, analysis, and previous performance, the time required to perform each of the operations specified. (c) Knowing, through the control board, the exact condition of each department, and each machine with re- lation to work in process. (d) With the preceding knowledge, determining the date THE SHOP ORDER SYSTEM 229 and hour any specific order will reach the various depart- ments, machines, benches, or work-places, from the time the order is started until it is delivered to the shipping department or to finished stores. (e) Following up of each order sent into the factory to see that the schedule as planned is being maintained and that movement of the work is recorded on the control board, and calling attention of foremen and higher execu- tives to failures in maintaining the schedules as planned. (f) Rearranging the schedules to meet unforeseen contin- gencies as they may arise, and promptly advising the order department as to the effect of such rearrangement on de- livery promises made. The Operation Analysis is a conference record as to the best method of doing a specijBc piece of work and incorporates the best knowledge and experience of all department heads as to a standard method of producing each part which goes to make up a complete order. The parts are taken from the specification sheets furnished by the engineering department in the form of bills of material; and the analysis of the method of manufacture, the operations to be performed, the tools and machines that will be required and the time for each operation, are entered on this Operation Analysis sheet, which is shown in Fig. 3. It has been found that by using this sheet the department heads concerned have an opportunity to take part in the preparation of the plan and advantage can be taken of the ideas which they suggest. Further, when they have a part in preparing the plan it has been found that they display a live- lier interest in seeing that it is carried out. When completed, this Operation Analysis sheet becomes the basis for all material and part requisitions and for Work Orders, both for parts to be made and for the assemblies. As these sheets are accumulated the necessity for repeated conferences on new orders will grow less and the personal equation will be correspondingly reduced. The first step in production control has now been taken. Providing the material is the next 3tep. With the Operation Analysis sheet prepared it is now nee- 230 PLANNING AND COORDINATING essary to check the bill of material with the stores ledger and determine : (a) What parts may be requisitioned from stores. (b) What parts must be made up before the assembly operation can be completed. (c) What material available to make up the parts not in stores. (d) What material must be purchased before the production of required parts can be imdertaken. In any industry making a standard product it has been found of decided advantage to have all parts which can be requisi- tioned ordered out of the storeroom on one requisition. In Fig. 4 is shown a form which has been designed and successfully used for this purpose. The advantage in handling and insuring that all parts have been ordered; that they will be delivered where needed; and the ease with which the pricing and ex- tensions can be made by the cost department, will be self- evident. Attention to this point has been found to effect material savings in the number of employees in the cost de- partment and to promote the accuracy of the cost work in marked degree. Where the orders received are special and where material has to be requisitioned to make parts, the Productive Material Requisition shown in Fig. 5 has been found best suited in meet- ing the needs of both stores and planning department, in that the schedule date and time when work is to be started, as well as department and machine number to which material is to be delivered, are specified. When the copy of this form is returned to the planning de- partment it is notice that the material has been delivered to the machine and the job is in readiness to be started. Until such a time this job cannot become a "next job" for the ma- chine, bench, or work-place. When it becomes necessary to purchase material for parts for the execution of any order, the planning department advises the purchasing department of this fact through the use of the Request for Purchase of Material form shown in Fig. 6. This form is made up in three copies, the first going to the THE SHOP ORDER SYSTEM 233 purchasing department, the second being retained by tlie plan- ning department, and the third copy being sent to the receiving department, which, when the material is received, notes this I..V.t PO«..TN9. 1 ACTUAL om TIME QET^UPTWRePF % Pinion Bolt 1200 opHTtneefF TOTAL EFT O-01 RE-OPSRATION ^ ''"^ CARD par't'no. 1155 ORD NO 22336 LOTNa 1 TO START 12-20- '18 BURDEN NO. EST OPR. TJI«E 3.5 hrs BURDEN RATE EST.SeT-UPTlHE BURDEN AMT. O^NNO. DEPT. NO. MACH NO. CLOCK NO OPERATION 2 6 n.2g Milling HOURS PART "*"' Pinion Bolt BATS AMOUNT PIECES 1 PIECES MADE TO-OAV PAL TO BCOPERATED AtiUW 1 , Fig. 7. Combination Woek Oedeb and Time Card identify the part number, operation number, the department to do the work, the machine to be used, and the time the job is to start, with the standard time allowed for both set-up and operation. It has been found desirable to design this Work Order and Time Card so that both may be made out at one writing and in Fig. 7 is shown the form for this purpose. When made out for each part these forms are filed in the "To Do" order file, to- gether with the copies of any Purchase Requisitions which may Fig. 8. View of Dispatch Boakd in Planning Department Fig. 9. A Special Form of Dispatch Boaed THE SHOP ORDER SYSTEM 235 have been issued, where they are held until notice is received that materials or parts have come to hand, when they become available as "jobs ahead" for the machines to which they have been assigned. It is the function of the planning department actually to con- trol all orders and their condition at all times and to be able to furnish promptly to the order department of the sales division information as to the progress of every order which has been put into process, as well as the condition of orders which are held waiting for material. To handle this function successfully and to meet requests for definite information promptly, it is necessary that the planning department be provided with facilities that will insure that this function will be carried out without delay. In Fig. 8 is shown the dispatch board in a planning depart- ment of a plant where, owing to the nature of the work, it was found desirable to combine the dispatching of the jobs with the planning department proper. With the Work Orders distrib- uted to the several locations, the operator comes to the window and announcing his machine number, is given the next job which has been assigned to this machine. The dispatch clerk takes care of recording the in and out time on each job and the board shows at all times the amount of work which is ahead of each machine, bench, or work-place, thus pointing out where the planning department must give attention to keep the several machines in operation. In Fig. 9 is shown an arrangement somewhat different, but based upon the same principles as the foregoing in its layout. This arrangement was made to meet particular conditions which were encountered in its installation and in its operation has proved very satisfactory. All sections of this board are accessible to the dispatch clerk from his desk. In addition to the dispatch board there must also be provided a means which will control the work as to the time it shall arrive at certain machines, how long it will require for operation, and where it must be moved to for the next operation to be per- formed, as well as when this next operation shall start. In the section of the control board shown in Fig. 10 the period. 236 PLANNING AND COORDINATING from March 1 to 11 is shown against machine numbers 45 to 63, inclusive. On this chart are shown the part numbers, manu- facturing order numbers, operation numbers, and the next machine number for the work assigned and scheduled for each machine. The following will illustrate the manner in which this control-board principle may be applied: Taking part No. 1012, manufacturing order No. 20318, we find that ma- chine No. 63 is to perform operation No. 3, starting the work of setting up at 11 A. M. on March 5; that this set-up is to take two hours and that actual production starts at 2 p. M. and is to continue until 10 A. M. on March 6. We also note that the next operation is to be done on machine No. 65, which is shown on that portion of the board not included in this illustration. Under March 7 and against machine No. 46 we find that this order is to start for operation No. 5 at 11 A. M. and, after taking untU 2 P. M. for set-up, production is to continue until 12 M. on March 8. The extension of the horizontal schedule line beyond the vertical line in the latter case shows that the job ran one hour over the time that was scheduled for its performance. From machine No. 46 the work goes to machine No. 49, where operation No. 6 is performed, starting at 7 A. M. on March 10 and continuing until 4 p. M. on the same date. From machine No. 49 the work moves to machine No. 46 for operation No. 7, after which it is returned to machine No. 49 for performing operation No. 8. Each square along the horizontal line indicates one hour and the starting point of each schedule line shows first the set-up time, followed by the time scheduled for actual production. At each end of the job time vertical lines are drawn and the actual time of starting and completion may show an extension of the schedule line into time spaces outside the vertical line when the job starts ahead of schedule or when the time taken ex- ceeds the time allowed. Where non-working time is encountered this is shown by a saw-tooth line, as will be noted against machine No. 52 for March 2 and against No. 50 for a portion of March 8 and all of March 9. The heavy vertical lines designate the week ending date, which, it will be noted, is Saturday noon. Attention is called to the facility with which the number of hours' work ahead of each machine is shown. We find that at the close of work on March 5 we have against machine No. THE SHOP ORDER SYSTEM 237 46 only 29 hours' work on our schedule and on machine No. 61 for the same date there is only 24 hours' work scheduled ahead. For the purpose of showing what percentage of machine load is being utilized, against the possible machine load that is avail- 1 MARCH ! I 2 3 4 5 — -r 1220322 3111 20321 -fj 2l>i!l 2 -01-60 01 231 20Z0Z -65 — I— « I0S2 20231 K- 011-61- Ki ' 20231 1052 202m 012 25 -TT -rcT •* T' ■ 1- I ■ ■ Ll' I2S6S - 63 391 2 0313 .»- "lie"" -^oop 3 65 —1., , _ Fig. 10. Machine Control Board able, this form of chart has been found to possess decided merit. Other forms for showing this information have been developed to meet conditions peculiar to certain types of industries and particular plants. In certain cases it has been found that the 238 PLANNING AND COORDINATING nuSber'of'"i^tc® ^e PRODUCTION ^fECOKD if Stmighhyaij\tlYe ?Tom March m -to Mar.3ISt F%.RTI« RkRT NAME 1 z 3 A 5 6 7 8 9 10 II IS 13 M- E )6 17 18 19 20 21 £2 23 Vr 25 26 27 28 29 30 3l| A / BODY COMPLETE SCHEDULE i 75 72 £ ~S _ 75 m 75 £ PRODUCTION i 76 .9 — — — — — — — — 1 5 72 f f — — B 2 PLUS SCHEDULE IOC •00 lOOIlOO PRODUCTION SCHEDULE ^ Si. roojrogrog = = = ^ E E = E ^ no ~ ^ ^ D 3 CAM COMPLETE PRODUCTiON SCHEDULE — w 4S IOC m 101 m w I — — — — — — - m ':-■'-'■ \ — — •■: PRODUCTION SO 107 II ^e:sb B 4C CAP COMPLETE SCHEDULE _J 1 JSC _ 1 WKIzitV-iii _ _ PROOUCnOH — — 1 V80 m 10 — — ~ — — — — — wisnff^ — — F S NUT COMPLETE SCHEDULE VII _M- Hfll Wis PRODUCTION ?3C 10 e ALL mRTS ASSEMBLY acHEDULE- /T/? ISO Wo|/a . IIS 70 zaa PRODUCTION no izs\m 55 H ALL TESTIN6 SCHEDULE i CO i 1 — — — — — — — — U — _ 1 ALL K/fTS INSPECTION SCHEDULE — — — ' - ISO — ' — — — — — — ^ // /-A JS '.va 88 11 65 11 / f 3- d 8"; 1, 45 5 a 57 1 a 27 3 a — 47 2 a 3 /- y /-J Jt 1* 2 a 92 1 p a ., A.S. 4 «> o 9 1 o / /-^ V B.V. 2 3 o a 5 6 a a 11 1 JL 14 1 t) •B.T. 7 3 O fi siAMrn O. Mfi^^*it*7iy DATE IS! CATC. RE !uro / - jr- / JT criutD /- i--/ f -h— POSTED B, a^. Fig. 1. Monthly Red Tag Report— 8 x 11 Inches— Wokk Behind Schedule MAN AND MACHINE IDLENESS 271 between different machine group classes; (d) machine classes to be arranged in alphabetical order. D. Information as to machine location and groupings to be procured from the machine and material location book which is kept up to date by the tool and operation depart- ment. E. New sheets to be made every month. F. Sheets ready to be drawn off the board to be placed in a suitable book in numerical and monthly order for future refer- ence. A form, size 8x11 inches, is to be printed and called the "Red Tag Report," this form to be ruled and have spaces for machine number and symbol, number of red tags (work behind schedule), number of regular jobs, date of first job, and date of last job. (See Figure 1). Each month these reports are to be prepared by the employment department as follows: Using duplicator ribbon, number each sheet from one up, place in col- umn for machine number and symbol, the number and symbol of each leader machine in each group to be arranged as on the idle machine board. Have a sufficient number duplicated to last one month. Deliver these forms to the despatch depart- ment, which will deliver to the employment department, not later than 9 a. m. the following morning, a complete report of the available jobs for each machine group. Devise a form in duplicate to include all the causes for machine idleness as mentioned in a preceding paragraph, so that it will be necessary only to check the cause for idleness that fits each individual case. Name this ticket "Idle Ma- "■"""'*' ettf. 28 10.40 AH. 1«>8 "tl^ /f on ••""> }ta. 28 10.02 M. H18 IH Ol^. D >» IDLE MACHINE RECORD •^^ 1 /■ MACHINE TOOLS t / Bteak-down Fixture Lacking Under Repair Rxturt Defectlvo Power Shut-otfs Supplies Lacking Belt Breakege Supplies Delectiva Tool Release Lacking klAN MATERIALS J AteenI Not up to Mactilne No Operator Assigned Urgent on Preceding Machine Reg, Opr. on other Work Ahead ot Schedule Up but No Orders Up but No Inst Card DISPATCH aERH-lswt.Wrli CMU.Swid Whit, to M.W., 1.5UID •^ MASTER WORKMAN-Vcrify vkI R.tum to OUpatch "sy"" /•-* DISPATCH CLERK-ComiKn vid wlwi wnO unO 10 Cmit.Dept totwPosttd- KMTBJ JUC Fig. 2. Idle Machine Ticket chine Record"; reserve space for time-clock records so that the elapse of time shall be recorded ; place in upper right-hand corner space for machine number and symbol and elapse of time m PLANNING AND COORDINATING T^,!,,.,, - Jan. 26 Jan. 2S . HOURS "ISTST- ■;::: 10.02 m 1918. MATE AMOUNT IDLE MAN 1 " "^ F-No. 115 "."»"| /^z>^ 1 ~-' ^^^..^.^ To"' yc, I TOOLS MATERIALS J Lacking, or Missing Lot Incomplete Defective, or Faulty Tags Missing Delayed lor Grinding Not up to Machine Delayed (or Supplies MACHINE INSTRUCTIONS t^ Break down Lacking, or Missing Repairmen working on Defective, or Incomplete- Belt Troubles Error (jt Clerk or Man Power Shutoffs Inspection Troubles Setting up Machine Job Cards Missing Remarks;- L^KvHvE'rE-oV FOREMAN -^--^ DISPATCH ^ RAT.DIV ^.^/^. _ Fig. 3. Idle Man Ticket in hours and tenths; at the bottom place the procedure for each man who is directly concerned and space at the right for his signature. (See Figure 2.) Devise and have printed a form that will show sheet number, leader machine number, num- ber of machines in group, number of red tags, drawing numbers, number of parts, operation number, lot numbers, number of lots and their dates. This analysis is to be drawn from the despatch cage every week to give a synopsis of the amount of work behind schedule and the exact stage of completion, that is, where it is and how near completion. These analyses are to be given to the production manager, his assistant, the factory superintendent, chief inspector, and the chief stock-chaser, as a guide where to direct their most earnest effort. A comparison summary of this report is to be made each week by giving the total of red tags charged against each department, opposite these totals the totals of two months ago, and opposite these the per- centage gained or lost shown by a + or — sign. A grand total of all red tags in the factory is to be shown and its percentage gained or lost shown by the -|- or — sign. This summary will be a key to direct attention to the departments which are lagging ^^°- ^' Causes of Man and Machine behind. Use the present form which is constructed similar to the idle machine record but of different color, have instructions on the ^iJMHmg or Bliitng IMfMtlv* or Inocjgl^to BTor of oltrk or rata liupaotloa tmiblat Job atfd« Blitlag MAN AND MACHINE IDLENESS 273 reverse side as to the way to use them, why they are given, and the time hmit of a single idle time ticket. (See Figures 3 and 4.) Construct on graph sheets, as used on the idle machine board, a graph curve to show the amounts of idle time, separated to the four main reasons — tools, machine, materials, instructions. Construct separate curves for each department. The time is to be calculated by the week, a summary made, and the totals added to the graphs. This will give a graphic condition of the idleness, the department it is most pronounced in and the cause. Devise and print a questionnaire to give the employee's name, department number, address, telephone number, married or single, nationality, whether or not he is an American citizen, different languages he speaks, educational record, the number of processes he is capable of performing, and an affidavit from his foreman as verification of all the facts. All processes used in this factory to be listed with a space for the length of time worked as follows: Engine Lathe Opr. J. & L. Opr. Yr. Mo. Lo-swing Opr. Hd. Screw Opr. Yr. Mo In a Rand file, cards giving man's processes are to be recorded in departmental numerical order. These processes are also to be catalogued in a separate file under processes, where all em- ployees who can operate a J. & L. will be catalogued under head of "J. & L.," all men who can operate an engine lathe under head of "Engine Lathe," etc. If it is necessary to shift a man who becomes idle to another job we know from the Rand file where we can use him to advantage, or if we need a J. & L. operator on quick notice we can refer to our catalogued process file and find an available man. By this method we always work within our force and hire in at the bottom only semi-skilled or unskilled labor, thus reducing our skilled labor turnover to a minimum. In times of work fluxation in various departments we can shift surplus labor to or from departments with a greater degree of accuracy and discretion. 274 PLANNING AND COORDINATING A. Construct an idle machine board as outlined above. B. Procure idle machine tickets, having them printed in duplicate alternating white and yellow. C. Instruct the despatch department when a machine goes idle to issue an idle machine ticket, mark cause of idleness, send white copy to master workman, post yellow in machine rack. Instruct master workman to verify as to machine number, cause for idleness, and return to despatch department. The latter will then send to employment department when agreed as to cause of idleness. The employment department will post this idlenes on the idle machine board as follows : (a) Idleness is posted under date headings, and opposite corresponding machine numbers, (b) Idleness is shown by color as follows: Labor, red Material, black Absence, yellow Tools, blue Machine, green (c) On completion of posting, the tickets are placed on file for a period of two months. D. Construct and deliver to the despatch department the red tag report blanks as outlined above. Instruct despatch department to draw off a report each work day that will contain such information as, the number of red tags, number of regular jobs, with date of the first and last job of each machine group as outlined in the report. These reports to be delivered to the employment department not later than 9 a. m. the following morning. The idle machine board poster will record in the respective square, opposite the leader machine and under the correct date, the number of red tags in the right-hand small square and, in small numbers, the number of regular jobs above the left-hand small square with the two dates in the left-hand small square. After posting, the report is turned over to the idle machine board supervisor who makes the necessary notes, then it is to be filed for a period of two months. E. When necessary report to the production manager all doubtful cases so that corrective action can be taken. MAN AND MACHINE IDLENESS 275 F. Idle man tickets are to be handled as outlined for idle machine tickets, and delivered to the employment department not later than 9 a. m. the following day. The time limit of an idle man ticket is one hour and if at the end of that time the man is idle, the despatch department will send the man to the employment department, which will consult the process file, and send him to a department where the need for men permits and where he will produce according to his ability. The des- patch department will be notified by a temporary transfer where the man is to be sent, and, when production conditions require the man's return, the despatch department will notify his tem- porary foreman who will send him back to his regular depart- ment. Idle man records are to be maintained as outlined in a preceding paragraph. Reports are to be made to the produc- tion manager if there are any doubtful cases, or if any depart- ment has an exorbitant amount of idle man time charged up to it. G. When it becomes necessary to change the sheets on the idle machine board, the old sheets are to be placed in a suitable book with regard to months and sheet numbers. REPORT OF RESULTS The first three months that this system was in operation the idleness decreased 50 per cent, and has been steadily decreasing every month. An absolute check on red tags (work behind schedule) is made possible. Red tags are kept to a minimum as it is easy to plan a re-routing of the flow of work to the ma- chines which are idle for lack of work or are not heavily bur- dened. It gives the production manager a graphic condition of the entire factory at all times. It shows the employment de- partment where the need for men is the greatest. See Figure 5 plotted for a typical month. To show a graphic condition of the work behind schedule in the entire factory we compiled all the data we collected on red tags, and plotted curves by departments using a different color for each department. These curves were available at all times to all persons who were concerned in reducing factory burden, and they acted as a guide where to concentrate the most earnest 276 PLANNING AND COORDINATING efforts. The main object was to keep the lines on a downward trend and to keep peaks off the chart. From time to time the idle machine charts were laid out ac- cording to months and to machine groups, to give the condition of each individual group or class groups for a period of six months or more. Then an analysis was drawn off which in- cluded all the factors as shown. This shows the production manager where the need for extra equipment exists, where ..._^- ^.>^/ ^^ /\ ^'^ ^^ /\ /»« -_ .., -^ u ^ — ^ . / s^ '*''i^ \(^-^ -^ " S .'^ -- — ^ \ X "S. Tepl^ 0>- ^ ^ s. Fig. 5. Curves for Month Showing Where Men Are Most Needed excessive equipment is located, where the flow of work is un- even, the prevailing cause of idleness on certain machines or machine groups, the need of new equipment to replace old where the machine is constantly going idle for repairs, and a number of little details which are of great assistance to the production manager and his staff. The production manager, his assistant, the tool and operation department heads, foremen, and even workmen consult the idle machine chart daily for this, that, or the other reason, proving that it is of utmost importance to have an up-to-date method of idleness and burden control that will at all times give the ex- act conditions as they exist in the shop, whether or not these conditions are improving and where the source of the trouble is. ROUTING How to Route a Multi-Part Mechanism Evolution of the Progress Sheet HOW TO ROUTE A MULTI-PART MECHANISM BY H. K. HATHAWAY THE photograph Figure 1 shows, in the form in which it is to-day manufactured, the automatic machine, which Taylor developed and first had built while he was at Mid- vale for grinding cutting tools for lathe, planer, and boring mill work to the shapes and angles adopted as standard. This machine and the standard tools which it grinds are some of the fruits of his investigation in the art of cutting metals which started with his early efforts to set honest piece rates. Quite apart from any sentimental reasons, or perhaps in addi- tion thereto, I have selected the route charts for the Taylor grinder, because it presents practically all of the features that may be encountered in the routing of any fabricated article and at the same time is simple enough to be readily understood. Figure 2 is the diagram or chart showing the final assembling of the machine. The list under the title at the left indicates that the machine may be divided into eight principal groups, seven of which may be assembled independently previously to being combined with the parts making up the "miscellaneous group." One of these, the Base Group, is made up of three divisions, two of which may be independently assembled and a "miscellaneous division" consisting mainly of parts used in putting together the divisions GTBN and GTBP. It will be seen that the several groups appear on this chart as single units — just as though they were taken already assembled from stock, two of them, GTB and GTH, being required for the first assembling operation IGT and the others being called for as the work progresses. It will be noted that the location of the groups on the chart for final assembling fixes the relative importance, from an order of work standpoint, of the several groups rather than the alphabetical arrangement of the list of the groups at the right of the diagram. That the base group 279 280 ROUTING should appear first in both cases is a coincidence in symboHzing. A study of the chart reveals the fact that until the Base Group and Hood Group are put together no other operations of the final assembling may be done. Operations 2GT, 3GT, and 6GT may, however (providing the parts are ready) , be done simul- taneously by three different men of different degrees of skill, thus reducing the time the machines will take up space on the assembling fioor. It will also be apparent that while operation 6GT may be performed any time after operation IGT, it need not be done until after the fifth operation. Sometimes we learn as much by observing the imperfections of the object we are studying as we do from having its good points brought to our attention. In the diagram under con- sideration there are three defects — or rather, deviations from the rules — and if my readers were a class I should ask them to find them. The first of these faults is that the diagram is drawn as if the Indexing Device Group GTD and the Platen Group GTT were to be united by the performance of operation 3GT. The fact is that they are to be united with the Base Group and the Hood Group which were brought together by operation IGT. Two courses, either of which would have conformed to the rules, lay open to the route man, either to place the two groups concerned and operation 3GT in the same section of the chart as the units assembled by operation 2GT, or to place them in the section pertaining to operations 4GT and 5GT. Either course would not, however, provide for performing the operation indepen- dently of operations 2GT, 4GT, and 5GT, which seems to ac- count for the compromise. The second defect in the case of operation 6GT is similar to the one just cited and in view of the group GTW being more or less in the way, it is a question whether it might not be better to defer this operation until after operation 5GT and for this reason the operation is desig- nated at 6GT instead of 4GT as would otherwise seem more natural. The third point open to criticism is that there seems to be no particular reason why operation 4GT should not have been treated in the same manner as operation 6GT. As shown it Fig. 1. Taylor Tool Grinder The names and symbols indicating groups and parts will help to an understanding of the Route Charts. Photograph by courtesy of The Tabor Manufacturing Co. 81 M5 Iron Ccistinq l-MniWll2-Dritia[' ■Paint first coat V P^j. el's i' 171," Iron Castinq ^ fBoreafeceL9. (Allow to dry for 24 loi"CoM Rolle Kut off MK)^ ■"VCold Rolle Mhrenrf, qnj( ■"iVCold-Roi |-CutoffLI6. 2-0 ■%x3)6CoMR l-Cut off MlifLayoi ■ r Blank Lyel I" Weld shanks on pocket) 2-Cenfn! ■ I'BlcinkCye^ I'WeW shanks Ofl , pocket) 2-Cesil l»»u«tDBSforlT9M— ►27 '" " " "IT6M-*2f ftST^ to by ed on an of on ise ps ad 3), I a of m, ns ;et )al n- 5P he ey lal n- V4> ve o, im n- M ed he on ,m 21 r«lron Ccistinq ^ SGTIM ■) J U-Paint fiMcMVa "lb Assem. *{; ICLAMPforHOOO GTIMB Dr 50445 base: group gtb« hood " gthb \^LX BOLT MV*4x3ZIH P >» llrrxi Casting SSTZM ■ l-Bore a ffice IS. Jface hub LI, J-Chipft ffle V?6. 4-ftifnl nrst coat V28. (Allow to dry for 24tirs)5:PuttyV25 (Allow to dry for 24hrs) 6frH va8(^llow to {try fbr24hrs) 7-Rub down & paint VZd ■ ToAssem. Einpiss Casting assemSSjng stI Put HOOD G/m'on MAIN .win f^ffAM€& secure wi/h ^WJO CLAMPS &fia BOLTS. a-9979 •■ V22 IGTB THE TABOR Mr&.Ca PHILA. PA. nii in lOSCILLATG CAM Dr. 59898 GT2MI fir ^= ' l-Chip & file V & g-ftiint first coat V28 ■i''2t2"CoW Rolled Steel l-Cut off MI D. 2-Bor^, face & turn L9 Sgt^m To Aaser |''%"Cold' Rolled Steel |-Thre<7d, ciroove 8c cut off LI6. SVil^SIR lb Assem. SVJ^ilR lb Assem. ■ \\ Cold ^Rolled Steel - ■, l-Cutoff LI6. E-Centre & turn LIS. SVII'iSIR lb Assem. ■SPRING SWIVLL GT3MI z Dr5l96& ■COLLAR on SPINDLE 6T4MI . Dr 50459 ' P POST for 3PRIN<5 GT5MI =■ Dr 50488 ■"l^Ax^Cold Rolled Steel ' , ■ 5Vl^ix^53RL l-Cut off Mlg.^Lay out IQ3-Dril1 PI. afile slots 8c round ends VZZ. Tb A ssem. 7 BIcink tye Bolt, Type A, Williams Cwt SVIZ9B l-Weld §h«inks on bolt B5.(Do not post until 5VI5IM is at BS. See issue in pocket) 2-Centr e & turn L5. To Assem. ■ rBlcinKE:yeBolt,^peA,Willic!rrfsCat ■ . SVIZ9B Weld sht^nks on bolt BS(Do not post until SVISIMisat BS.See issue in . pocket) 2-C entr9 8c turn L3 . To Assem. Issue to BS for IT9M- "" " " "IT6M- B*6TAPLRPIN, SV«6x2*4Zt1 ISPRING SMV^x5xlV?8WT L,. (■"MACHINt STELtL SVISltvl fSJl irMACHINE: STELL SVISIM IIS'PULLtY Dr59904 SGIT22M J ICAM ShlAFT Dr 59892 ILOCWNG PLATt Dr5l3l4 ■rULCRUN^ PIN Dr. 51316 ■ LOCKING PIN Dr. 50494 ■OSCILLATb LLVLR 6R. ■ DOWLL PIN MV^ix GT6MI GT7MI GT&MI GT9Mfl GTJ^ l''4ZDP ASSEMBLING 6T^ £>riyeOSCUA77NGCAMon CAM SHAFl Mild: ream for TAPER RH.M SHAFT throjah STAND, ml en PULLEY &s(xun wilh S[T SCREWS Screw HEX NUTonPOSirorSf^m,screty POSThto STAND & hqhtenNUT Put COOMo) SPINDLE put OSOLL- . ATING LEVER In place & put in . ntCRUUm Put LmiNG PLATE , onSTAtlCldnll, tap&Secu/rmtti i'1-XlitACH.XREWSPutSWinLS ■W31 onSPRINGputSPmGonPOSrS Locate (MlARS, bycentraliz- in^EUERY WtlEEL mtfi PLATE on APRON & trying tt>n>iv of CAM&LEm, drill & ream Tor '6TAPER PINS dcdrinh PINS Drill for DOWEL PINS thruCAP & BEARING & put in PINS Dr9979 - v24 _■ aH.MACH.SCREW SVM-a)xi?Z4M ►^Yift-1916 eiTI S3I 1-34 13" 26"' 'Z\ ^h Iron Cflstinq l-Bore 8( face L3. 2-Dril! DIO. 3Chip & file V26. 4-ftilnt firit Cont V26 =^=^=_= [Brass Cc^stinq LChip & file V 26. 2-ftiint first coat Vgfi ■"I'^le" Hex Cold Rolled Steel |-Tum8itti readLI4 SGTIOMi "lb Assem. 26Ta 5GTIIM ToAssem. _ 5VI'i6S2R ToAssem. ■"«2" Mactiine Steel SV'-^SIM l-Bend BS .2-R;^int first coat V28 „ ToAssem. i"l''is''Cold l^olled Steel SVIhsSIR I'Turn.cut off & chamfer. LI6. ToAssem. WIDLLR- J Dr 50447 •jaiROPL GUARD =^4 Dn 50464 j-lSTUO GTIOMB 6TIIMH GTI2MB . Dr50497» ■ yoke: GTI5MB \, Dr, 50522 ]■ TRUNNION W: GTI4M Dr. 50521 COUNTERWT GROUP GTCB) ^2HE:XNUT 5V^2Z2n}SJ3 ASSEMBLING 6TB ffsmotv L.H.SIDE BAP from COUNTEftwaetIT GROUP. Driye TRUNNIONS into MAINTIiAML Put COUNTERWEIGHT GROUP in place on TRUNNIONS & secure Lft.S/DE BAR witti HEX BOLTS. Scrw STUDS for IDiEPS into HOOD & MAIN FRAME,put IDLERS a POPE GUARDS on Studs 8c scretv on NUTS. Put ROPE on YOHE & throuq/ilDLEfiSainto DRUM. Put CaUNTEPWEJGHTonLJi SIDEBAR. Dr. 9979 V2 46TI Sit PLATEN pa'rctlklwifl) shears on MAINFRAME. VfZi Set INDEXING DEVICE so ttiat PARALLEL BAP rests squaray on PLATEN. Scribe line on CLAMPING ARM coin- cident to zero on ANGLE INDEX Afon HEIGHT SCALE & stamp zero Dr96l6 V3 I INDEX'G DEVICE Gi^OUP GTDl I PLATEN GTT( ASSLMBUNG GTB Set PLATEN GROUPon MAIN FRAME Jkmovt hwerfxilfor ■W32 BLARING on INDEXVDEV/CEput DEVICEonLKBEARINCa^i/re Dr9979 VZ9 39TB S6TI TAYLOR UNIVERSAL TOOL GRINDER 8 GROUPS L BASE GROUP GTB MAIN FRAMt DIVISION GTBN PUNP « , GTBP MlSCtU n GTBM 2.C0UNTERWEIGHT GROUP GTC 3. INDEXING DEVICE 4.tt00D „ 5.05CILLA"hNGLEVERn & PLATEN H 7 WATER TOWER n aWtSCELL n GTD GTH GTJ 6TT GTW GTM* ASSEMBLING 6T^ PuttVATER GUARD onMAIN FRAME&sKurv mttr SET SCREWS Scrvtf UL CUPS into SPINDLE BEARINGS & SNAP OILERS info STAND /or OSCILLATING DEVICE Dr9979 V5 7GTIB Stamp MANUFACTtmrtS \ ORDER on MACHINC V9 SGTI >BSIT Test MACHINE t' I Iron Casting SGTISMi ayout L0.2-Drill8ctapD]j: J-Chip&fileV254-f^inf fff-stcoatvas %k\\w4 to dry for 24 hrs.) 5-Putty V28 (Allow to in for M hri) 6-Fi'l [yg8(All ow to dry for 24hrs) 7Rub down 6< RiintVZS ToAssem . if' Dr. 9802 9GTI I '■z SET SCREW |i'4 0ILCUP I'SSMAP OXER Mnt MACHINE 5Vt:x2ZIS SVfiAIL 5V'5A3L 535 v^& lOOTB IWATER TOWER GROUP l^'aHEX BOLT ASSEMBUNG GTB Put WATER TOWER ai HOOD & secure ■W34 with HFX BOLTS W\Am\ Or9979 ^V4 GTW Slusfj MACH/NC , I To Stores IIGTI Fig. 2. Route Chart for "Final Assembung" of Taylor Tool Grinder HOW TO ROUTE A MULTI-PART MECHANISM 281 would seem that operation 5GT could not or should not be per- formed until after operation 4GT, but this does not appear to be borne out by the construction of the machine, as shown by the photograph Figure 1. From a practical standpoint, however, these defects, if mdeed they may be so called, are harmless, and I have commented on them only to show the sort of questions that the Route Man must decide in making a chart and, that even with the best of routing, the person handling the Shop Order of Work function must understand the route charts and be competent to exercise good judgment. He will always play safe if he follows the steps in the numerical sequence laid down by the Route Chart (and the Assembhng Route Sheet as was explained in my last article), but in order to shorten the time required for assembling or in a pinch to keep men supplied with work, an intelligent reading of the Route Chart, and possibly consultation with the Route Man, may enable him to make certain deviations to satisfy conditions out of the ordinary. Figure 3 shows the assembling route sheet GIT. The Chart Figure 4 shows the assembling of the principal group— GTB. On this chart it will be noted that the Assem- bled Main Frame Division GTBN and Pump Division GTBP are shown as single items or units in the same manner as are the parts constituting the Miscellaneous Division with which they are united to make the complete Base Group. In the final assembling of this group there are no units that may be assem- bled simultaneously. The parts grouped in the section W4 and S4 may, however, have operations IGTB to 8GTB inclusive performed upon them simultaneously with, or previously to, the assembling of the divisions GTBN and GTBP. Apart from this the assembling is a series of consecutive steps. The most interesting feature of this chart is the inter-depen- dency of various parts. For example, in the case of GTBlM it is shown that the second operation may not be performed until pieces GTB2M and B3M are finished and delivered to the layout table. Piece GTB2M may not be drilled (operation 4GTB2M) until piece GT2J from another group has had certain operations performed upon it and is delivered to drill press fes' _ g.E.E_|g 282 -W* ^■&- 11 E2U & SSU are at LO guidance of the shop _W4 -tea. .J.**. ntil GT2J' 19 at D U c a i guidance of the ; shop pPS* ij LI»TO»P*«T« tl«Oe^O»THI» 1 . ; ,OflOU> 0« OIWIStOM , s "V«^""."vr."»'- 1 I If 1*5" B T 1 M m^zifi 2 ?<3 n T w (J T H 1 ^0 ' . ■ - ■ - . 1 1 1 1 1 1 i- 1 I - 1 IN X T c 1 T 1 _1Q_ WANTED ii U«T Of PART8 M*OC ^0« TH19 QKOUP.CHDIVIOOr) 3 1 """V"","":" HI G T 2 M m^,/sxi\mv 2 ..iX. T 3 W f?V-|Z2W ■ T 4 M SV14-20xiZ4M _2. T 5 M RV#6x2-?ZT JL G T 6 M 3MV7/32X7/32X n T f vt l.q/lfixSflWT 1 R T R M 3G1T22M 1 G T 9 M G T Jl . ■ 1 ?. 5J- G T T) -.52. G T T jj 'i?, G T 10 M TV^7?.W _i. "33 G T 11 M G T 12 W G T 13 Jf G T 14 M G T C 4 53 T W liV3/Bxl:tZlH ■ 2 6 54 _-ii± G T 15 M W^X2Z1S 2 __i5. W|A1T. _2. - JV#5A3I. 2 i"? 55 1 1 «■!»•• o .CO LUMN CAN AC PCnrOMMCO 9; J w ^ * M ^ ' 0««,.O.S.«.H,SCO.„---US,_.CP„PO.^^^ ^o,..«cc...,o« T 22 1 G T • • • • 30 9979 9979 Do not post until f V 24 2 T .... : : : : 31 9979 1 T IB flnielwd. T 29 3 T : : : : 32 9929 • •'•• 33 V 22 4 T 9816 ^11.' V 3 SOT 9979 Do not poBt until 1 T iB f InlBhed. V 4 6 T :•:• 34 9979 : : : : 35 V 5 7 G T V 9 8 T : :; : V 10 9 T :::: V 28 10 C T V 35 U G T TO STORES. Fuj. 3. Route Sheet for Fin.\l Assembling Showing the Manner in Which the Deviations from the Ritle in the Case of Operations :^ot, ogt, and Ggt Are Called to the .\TTE.VTio>f of the Ohdkk of Work and Rkcordivg Clerks »9 » 3:.3,Ss»^iBS..- IRON CASTING MATERIAL OROERtD FOK MATERIAL IN STORES 1 14 2 r 1 3 B 3 4, L 4 5 L 6 D 11 To Assem. G _W5 Dn. ^$ S0469^-.._ RES' P. O. ITEM 1 G T B 4 U 2 G T B 4 M 3 G T B 4 U 4 G T B 4 U 5 G T B 4 U 6 G T B 4 M Do not poet until B5M 1b at L4, :Sumisirlze all oserations with ESU Fig. 7. Piece Route Sheet for Gtb4m Showing the two being machined together G 1 T 1 T S 5 M -W» 3 I L.H.Eearlng IRON CASTING MATERIAL ORDERED FOV. MATERIAL IN STORES To L4 for 1S4H Fig. 8. Piece Route Sheet for Gtb5m Note that on these and other route sheets the operations are indicated by symbol only. Full description of each operation is provided by instruction cards to which the operation symbol serves as an index. The importance of the detailed instruction cards is emphasized by the fact that operations 1 and 4 are performed in the same machine 284 HOW TO ROUTE A MULTI-PART MECHANISM 285 No. 11 (Dll). See Figures 5 and 6 for the manner in which this is treated on the route sheets for the individual pieces. As the two bearings GTB4M and GTB5M are quite similar, it is desirable that the several operations be performed on both at the same time — this is what is meant by the note " Summar- ize all operations with B5M " shown in connection with the first operation on GTB4M. (See Route Sheets Figures 7 and 8.) The differences in the work on these two bearings, which it will be noted are made according to different drawings, will be cov- ered in detail by the instruction card. This brings out the point that two or more different articles may be handled on the same route sheet as a single job where they follow the same route path, i. e., when all or most of the operations are similar and may be done at the same machine or work-place. Such a procedure may be desirable from a mechanical standpoint or to decrease the cost and trouble incident to putting through a number of small jobs routed separately, whereas they may be combined to gain some of the advantages of production in larger quan- tities. In some industries the combination of a number of more or less similar articles into one manufacturing lot is the only course economically feasible. The interdependency of operations on various parts com- mented on above is shown by notes on the route sheets for the parts concerned, and the Shop Order of Work Supervisor and his assistants are governed thereby in regulating the performance of the work in the shop. Any one who has had experience as foreman or superintendent of a shop handling a variety of work will appreciate the difficulties and danger of errors, where, as under the old way of doing things, such matters had to be planned largely on the spur of the moment amid the bustle in- cident to shop operation and often perforce left to be taken care of by the individual workmen who might or might not be sufficiently familiar with the products to understand the re- quirements. Even under the best of circumstances lowered production was inevitable. To these men the value of orderly planning in advance such as we have been discussing will be at once and fully apparent. The question may be raised as to why the paint, putty, and - V- i? odcdScDu o r -7 1- ?3 l-l-l-HI- H-l-t- i-i-i- OO^O CD O U) O O O U) CD i35 ii D < to or bJO -•p o S5s e c t e c K I— LJ > oj 1-rt "^ uj (D (■-■ <5 is cflr Ul > 5; gQ H 10 O «& ^ > >>> en CO o CO !^ !n 5 S - 3.S y 1 1 } ! ■J K oi % i i i oS s Si S »> W« - « M fi I Bi X CO 3 1 . 2 o . ^< ■o a: ■ fc* 1 J 2fe 1 - ? _J z CifTififinn : c J ^ If i! E 'J I .5 « ;« Si" Jd r^ ?° •' i« »J t.» «? ^' o H O s Q tn n w « ^ Q ?^ & P O Ph H O O Q O s (H n P3 p Q « W m O tf a o o fe « H Ph U § n (N u H O n (^ o tf fo o w 291 292 ROUTING and Stores issue No. 1), which according to the symbol MC3HA constitute the Arm Division of the Brush Holder Group and of a "Miscellaneous Division" consisting of parts (not assembled), which are attached as a result of operations M1C3H and M2C3H. On the chart for final assembling it will be seen that there are four other groups MC3A, MC3B, MC3F, and MC3G, in addi- tion to the Brush Holder Group. For each of these groups there is a chart as in the case of MC3H, while on the final chart they appear as single manufactured units. EVOLUTION OF THE PROGRESS SHEET BY H. K. HATHAWAY T^! ^HE routing mechanism developed by Taylor and his . earlier associates involved, when I became acquainted X with it, the use of a "Progress Sheet" as a connectmg link between the route sheets governing the work on the individ- ual parts (piece route sheets) and those for assembling the sec- tions, divisions, groups to which the parts belonged, ihe assembling route sheets, which were in form and manner of use essentially the same as the piece route sheets, did not indicate whether or not stock parts to be drawn from stores for use m assembling were apportioned, assigned (on hand and reserved), or issued; nor did they show what parts made specially tor the order were completed. Hence, if he were to be governed by the route sheets in starting assembling operations the Shop Order of Work Supervisor would be obliged to go frequently through the piece route sheets pertaming to the assembled units to learn when the last of the parts had been finished and deliv- ered to the Assembling Department, and then to send the Stores and Worked Material issues to the storeroom. Quite often the storekeeper would report back that he could not supply all of the items called for and this later on led to the "assignment of materials from the quantities shown by the balance sheets to be on hand, as explained in previous articles. The Progress Sheet Figure 1, was intended to and did in some measure bridge the glp between the piece route sheets and their assembling route sheet, but there were too many instances m which all ot the parts for an assembled unit were finished, but through an oversight the operation orders for assembling had not been is- sued I recall that during the early days at the Tabor Manu- facturing Company, the Gang Boss in charge of assembling, an exceptionally alert and competent man who was quick to avail himself of the advantages afforded by the system, made a prac- 293 294 ROUTING tice of checking up deliveries of parts with his copies of the route charts and frequently, if the stock parts did not come along from the storeroom or the operation orders for assembling appear promptly on his bulletin board, he would call the attention of the Planning Department to its shortcomings in the vigorous if sometimes inelegant language of the old-time machine shop foreman. This was real cooperation — and while, of course, the system ought and does in perhaps 90 per cent, of all cases func- tion properly, it is the duty of a Gang Boss to check up the Planning Department, reporting such things, for example as materials in his department for which the operation orders do not appear in a reasonable time upon his bulletin board, jobs which are not promptly moved upon the completion of an oper- ation, etc., etc. Even though in many instances it may be found that there is a satisfactory reason for the condition re- ported, the Shop Order of Work Supervisor should give each case prompt and courteous consideration. No system, however well devised, will function perfectly — it is human to err, eternal vigilance and checking up is the price of success. The early Progress Sheets referred to had a two-fold object: First, to show in condensed form on a single sheet the stage to which the building of a machine had progressed without the necessity of looking through the large number of route sheets pertaining to the parts and assembled units. Second, to in- dicate to the Shop Order of Work Supervisor or his assistant the Recording Clerk when all the parts for a division or group had been finished and the operation orders for assembling might be issued. The first of these objects they served very well and in the Planning Department of a large works with many manufacturing orders in progress they are still desirable in one form or another as they facilitate the keeping track of progress by the Production Superintendent and others concerned to a great extent without interfering either with the working mechan- ism or those who must be constantly using it in running the shop. They add, however, the work of "checking" to record progress at certain stages on sheets filed separately from the route sheets which has its objectionable features and they, as I have pointed out, were not entirely satisfactory in the accom- 95 ag et •e- si- he n- to irt la- >se ch he ay nt ite >nt ag he ler he r's ce ile res ice 1 is ip- leral /ORK OPER- ATION 'DATE TO BE FIN. HOURS WORK OPER- ATION DATE TO BE ■m HOURS WORK GROUPS DATE TO BE FIN. HOURS WORK KEIY TO LLTTERS INDICATING OPERATIONS CtiRRESPONDElNCE MO >■ o r MO MO MO Beise MI2I84.PB B-Borln(? Mill Work lMfORMAfN,"roDWG.RM. MR MR MR MR Heac< MI2I64PH C- Carpenter it DRAWINGS o ID M M X Yoke MI3I84PY D- Drill Press " BLUE PRINTS =:fn L B LO 1 Misc'l M 131 84PM G- Grinder " CHARTS aa B P D RA Complete MCH. 1 - Inspect inq " ROUTE. SHLET 'S LO LO C L-Lcithe Work 2D D 1 LO-Lciyinq Out ^,^ 1 2M RA M -Milling Mcicti. Work o-^- RA 1 MO-MateHcil Orderec) RA MR -Material Received c o Qfl MO OX 1^ Mo P -PIciner Work MR MR RA-Ready to Assemble 1 ID M V-Vice Work 1 L ID X - Pipe Cutter Work LO L u^ ZV LO rfl — B 2D M G 1 V RA 1 1 RA 1 2 •SOQ -•■=t MO 1 = MO HLAD GROUP Continued 1 MR MR LO M D P 1 1 -- LO S£ MO 1 p2 RA D MR 1 (B 1 P cr- BC RA M 1 BB >■ MO 11 D MR V 3 < b P X LO 1 > D RA L E < HH 1 HG RA HS h- MO HK ^k IMR HT Q^U^ HC ^* D u (^ 1 RA AW/" £?/■ /7Rr/ Column. — . ■ . JL 1 1 , Fig. 1. E.\RLY Form of Progress Sheet n .V,'!,T !.l'!" r""''''"""" *\f "'1 of « Siven class of work in the various parts pertaining to an Assembled Unit— PS indicat. a c lu c k mark was made in the appropriate space on the Progress Sheet. for thrfir«l'T« -?.Ti'-* had thus been ch-awn opposite all of the operations to be performed on the parts of a div tor ttie hrst assembling operation was issued. ndicated by the route sheets — ision the operation order ing route sheet and progress sheet illustrated in previous 29 tic ch th« pri PL SO] foi syi tie PL m£ no wt ati foT po pr< we Ff] wL ne< pe: die th( ha' be an ms for by gn isn sh< pr< roT II EVOLUTION OF THE PROGRESS SHEET 295 plishment of the second object — that of controlling assembling operations. The combined assembling route sheets and progress sheet developed by Mr. John Carter, which has been described in pre- vious articles, overcomes the objections cited, but still necessi- tates the Shop Order of Work Supervisor having recourse to the Route Charts — which are not in his principal working mechan- ism, the Route Files — ^for certain information that may be es- sential to planning to the best advantage. To overcome the disadvantages and shortcomings incident to using the older form of separately filed progress sheets, as a part of the working mechanism as well as to make all of the informa- tion contained by the charts conveniently available to those using the route files, Mr. Carl G. Barth devised a method which presents some novel features while retaining virtually all of the advantages aimed at by the earlier methods. And here it may well be noted that Mr. Earth's is the only marked development that has been made in Taylor's original scheme of routing. Essentially what Mr. Barth did was to draw up his Route Charts in such form and size, as: a. To permit their being placed in the Route Files in front of the piece route sheets to which they pertained. b. To make them serve the dual purpose of assembling route sheets and progress sheets. Through the courtesy of Mr. Barth I am able to produce the charts for final assembling of the Telescope Group of a Warner and Swasey Azimuth Instrument, which were made during the time he was engaged in directing the application of Taylor's methods in the Arsenals of the United States Army Ordnance Department. The student of Scientific Management will find it worth while to read the report of General William Crozier* in which he gives a most interesting account of the results achieved in the face of obstacles such as are unknown to civilian industry. This is indeed a strange case of human inconsistency — one would sup- *Report of the Chief of Ordnance to the Secretary of War, 1911, 1912, 1913; ako an address by General Crozier, "Scientific Management in Government Establishments," Bulletin of the Taylor Society, Vol. 1, No. 5, October, 1915, and Report of Hearings before Special Committee of House of Representatives to In- vestigate Taylor and Other Systems of Shop Management. 296 ROUTING pose that every citizen would be vitally interested in having government plants operated economically and efficiently as General Crozier's report indicates conclusively that they were in those cases where Scientific Management had been applied; and yet shortly thereafter the people's representatives in Con- gress passed legislation, the object of which might only be in- terpreted as to prevent the continuation and further develop- ment of those methods-of management to which Crozier credited the savings and increased production shown by his report. Contrast this with the order issued by the French Government requiring the application of the same methods in shops produc- ing munitions of war.* Present high tax rates and changed conditions may lead the citizens of the country and their repre- sentatives to take a different view and action. "Mais retour- nons a nos moutons." It will be seen that the diagram for the Telescope Group has been broken up and is shown on three sheets of a size suitable to be placed in the route file instead of being shown as a contin- uous diagram on a single sheet — as In the diagrams illustrating the preceding article. If it were to be so shown the arrange- ment would be as drawn on the skeleton diagram, Figure 2. Of course, some of the chart's graphic value is lost through this process of breaking up into smaller units — which bears out the old adage that there is "no great gain without some small loss." However, If it seems worth while, there is nothing to prevent supplementing the charts as drawn by Mr. Barth with skeleton charts showing the fiow and relationship of components and assembled units. Under certain circumstances it might even be justifiable to have two sets of charts — one of the type under discussion for the route files and the other drawn along the origi- nal lines developed by Taylor and showing all details. Mr. Earth's charts do not show In the case of parts made especially for the order, the primary material from which they *BuUetin of the Taylor Society, Vol. IV, No. 3, June, 1919. In extenuation of this action it may be said that those who urged the passage of such legislation were prompted by a fear of abuse growing out of un- pleasant experience in the past with piece work and other incentive schemes as administered under the old style of management, the unfairness and evils of which Taylor's life work aimed to eliminate from industrial life. Fortunately, to-day, there is an increasingly better understanding of scientific management by all parties interested in industry. EVOLUTION OF THE PROGRESS SHEET 297 are to be made nor the operations to be performed thereon. This information being shown only by the piece route sheets which must consequently be made up as the routing progresses instead of being copied by a typist from the route chart. Whereas, the charts as described previously furnish a complete record of the routing and it is unnecessary to file for use in the manufacture of possible future lots of an article anything more than in route charts; in the case of those developed by Mr. Barth, it is necessary to file the piece route sheets which are complementary to the charts as well. The parts manufactured specially for the order may, however, be distinguished from stock parts drawn from worked material stores, this being in- dicated by a supplementary letter placed under the worked material issue number. For example, the letter F under W 21 indicates that the parts included, NMSATD and NM3ATF, are made for the order and will be found in the custody of the " stockkeeper " on the "Floor"; the letter S under W 22 shows that parts NM3AT1M and NM3AT2M are to come from "Stores." The lines of flow are indicated by the letters enclosed in cir- cles — for example, on Figure 3 at the extreme right of the sec- tional diagram including operations 1NM3AT and 2NM3AT is the letter A which also appears at the extreme left of the sec- tional diagram covering operation 3NM3AT, indicating that the latter continues where the former leaves ojff. It just hap- pens in this diagram that the assembling is entirely in pro- gressive sequence — that is to say, there are no units in the final assembling of the group which may be independently assembled at the same time and united by a subsequent operation, all of such units having been treated as "divisions" and appearing as single items on the chart for the "group." For purposes of illustration let us suppose that the lower section on Figure 3 consisted of two or more parts to be assembled independently, and then united by the fourth operation with the preceding section. In that case the letter A in a circle would appear not only at the right of the first section, but at the right of the second as well. It would also appear at the left of the top and bottom lines of the section enclosing the operation or operations and 298 C O f- *-- _ - " c ^ 3 ^ a o ^1 ^ » a o al 3 r^ U « rt s:! t- » ei « « fl> r-1 » ^J3 C U « C^ o L. -^ V 4> T? o • a to c -^ * ta o • w<^ c c 5 - . ^ M p fcu n « ^ tN - , 5 P C « M M-4 < 3 a C ii If si ^ f ^^'- %^ o =^ ::s C =» -* 2r 3 5^ 3 « U bOu. 3 o a, o c o o o u. -^ ^ o ^ is;* U< O £ 299 300 ROUTING any miscellaneous parts uniting the two sections. This course as has been intimated would only be followed if the units in question were comparatively insignificant in the number and character of the parts and in the work involved in their assem- bling. Otherwise they would be treated and given symbols as divisions instead of unsymbolized sections in the group. Provision is made for checking to indicate the completion and delivery to the Assembling Department of the parts made specially for the order as will be seen on Figure 3, following the symbols of the components NM3ATD and NM3ATF preceding W21. Here a full check mark would be drawn as soon as the route sheet for each division showed it to be finished and moved. It will be noted that on Figure 5, upon completion of the assembling of the Telescope Group, checking upon the chart for final assembling of the instrument is called for. There this group appears as one of the units or elements making up W68. In the case of the parts from "Stores" — ^W22, a half check mark would be made opposite each item when the "worked material issue" with the move order for its delivery is sent to the storeroom and the check mark completed upon the move order being returned, showing the material delivered to the assembling department. The practice of assignment had not, I believe, been adopted at the time these charts were drawn and to provide for it, there should be an additional checking space to show material on hand and reserved for the order. As it is, the sheet could be used, a half check mark indicating material assigned and a full check mark its issue and delivery — this would not, however, indicate those cases in which the move order and the "issue" had been sent out and not yet returned. Near the right-hand margin of each sheet will- be seen the spaces for recording in the same manner as on the ordinary route sheet the progress with respect to each operation and for indicating the bench or work-place number at which the opera- tion is to be performed. This may be expanded if desired to show for the guidance of the Order of Work Supervisor the number of hours' work represented by the operation and the scheduled date at which he should aim to have the operation or series of operations "finished. (So- *- ^ a O (71 B vJ -) tH o o oo •q® ffARHER AHD SWASEY AZIMUTH IHSTRUMENT Part ot Tela Order inia'AT (g)= Asaombllng Dr. 22-30-; 4N}J3AT 1 NMaATli. Pit Splaol , Splash Scalo Po r NM3ATL2L 1: im3V3 Pointo. ,or N'JSATIL r NU r UH3AT31, . NM3ATL HM3ATB Dra* Tube Scri J 24 Division NH3ATB Aaaemble Lamp Sleeve HM3AT2D. Rovolv* Sla llcromatsr tJjnp Slev/^ IU3AT2B in Draw Tub* o anJriocate Sleeve r Opatiins9, >n Draw T W 9IIU3AT \Z7 "^rtt.i Cr „w Hil.3AT8U \\C.f I N)J3AT7U and 4 Dra« Tubs ' Case and Splash Pointer 10NU3AT Taot Ey« Piafle X 10 Divii HWSATf and B/o Piocg X 15 Division KU3ATC In Adaptor Diviaiio HJUATA ( W mSATD and pa 25 fitting 31..^ ing Hut rniSATlU b uK 12NU3AT Kii3ATR J< 1 9ro\9e\ Lt propwly. istor Divislor 1 KX3ATD Vith » HU3AT1)M in INM3AT ^rn Lena asat In ObJoctW* Cell Vy. Holder HiiJATlJ to suit thd dotorninod focal ^i length of Objoctlva NUSAflOU; alaa cut / thread In sann for Call Ring ra3A?2; as par / 16rai3AT or N113ATJ NJI3AT2J P Call Holdtr KUSATX; iva niSATlOU in Hold- a ea4 (ms $R2. I^r|«rt xi^ lf11«UB t IMK-Slka Z-Sb. tap. fort «, ASStMBUNS^MKS^lAB Ho,,L[ft UPPER* miK FROinS^ RlCHT UPHS'lMR FRONTS SR3. fWigr,,.fl,mKS18 2.-flrtt$ ^iil ^jnp opt5 Jl. fW^fln^ wrf" 2MK'StB it^oii i> iArii SRJ 4'FVCT(iori sud, opm Ji 5-PI|)e sme sun, Mi|n SRI ftrjorr, wiH 3fWSIA |L4tWRxJt!tWtJt |lfl4MSi*()xJ»tHcn |Si4iFii|>a>,if of »«J) tocM fn"*!)!! i'Turi) H.n uo«.).MiKi,r, euiK SR3. T Turi, bnq) )«»n «> ood )»i(<;ij aJoi;^ scan) lwT< Sg3 I L£fr FRONT IRMTFRONT MKSCIAB 2 " zia- HBr«u» Fbcktt Piccci ■ Br>«t RkKO Welt MK-SFIEB MK-Sf2EB iLEFTSIOEPOCIfETDiv MK-SFSl rRlCHT SIDE POCKET OiV MK-«,S I ISIDE POCKET STAYlNCSm-SfJAl i-SfxWtUtLiNiNcrAcmq ioon»«.'w<4 poan PitCt 5R3. 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A5Se:m6linq_ mk-sB 4-&HlfiOPStoCOATE*)DY SR7 5"Rt« pocket ieariji. jrnjiiole tafc, $i4stii). dS ■wmiii kepple. front f6orroii) to side se4n). RIO 6'5tilth tr«ids 67 9-Tnti) poiijt> j^j corners. BT lO-Tunjcodtrtjtirjitfe o«f 67 II" PaJte eif^e an^t) {rojjf "n't ootton) turqup. Sffil. 12' Bute {acjg^ to front dbouT r' I7si4e ed<)e. also across t»p t aXoiyt ehqe of li'ijinni 54itf tuojoiro- C7f skirt al«i)9 vei)' "I't botlonj 68. 15' Tikk f>aci95 iiloo^ lim^ seoiij. 0' 14' Tdck f«in) on.rtjfir sW« BIO. 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This Chart Is Somewhat Differently Drawn and Less Complete Th.yn It Would Appear When Finally Worked Out for Purposes of Planning and Control Toward Which It Represents a Stage of Development < a O « o H H 12; o 303 304 ROUTING general manager of the company down to tlie workers with re- gard to customs, methods, and tradition that have grown up through many years. Consequently, the routing and the system of planning and control might have to pass through several progressive stages before reaching the form which might at the outset be considered the goal. INSPECTION— ORGANIZATION— MANAGEMENT Organizing and Managing an Inspection Department ORGANIZING AND MANAGING AN INSPECTION DEPARTMENT BY GEORGE S. RADFORD LET US first think of the inspection department as a machine or an instrument for producing the control of quahty, •^ together with certain secondary duties to be combined therewith as a matter of economy. Then, if you please, we may consider the organization of the inspection department as comparable to the design of the machine, and the administration or management of the inspection department as comparable to the operation of the machine thus designed. Organization develops through the following process, which may be analyzed into three elements, namely : 1st. There is a union or grouping of individuals for a com- mon purpose; the necessity for organizing arises from this fact, whereupon there begins: 2nd. A division or distribution of the work necessary to accomphsh the purpose, so that each group of individuals per- forms the work allotted to it with undivided authority and in- dividual responsibility. This division of duties tends to become more complex as the number of persons involved increases or as the scope of the work broadens, and the resulting interde- pendence demands. 3rd. A coordinating of the work of the separate parts or groups, in order to secure cooperate action, and thus to weld them into one coherent whole, so that all work harmoniously toward the common objective. Organization begins with the first of these conditions, is de- veloped by the second, and is completed and perfected by the last. The higher the type of organization, the more intricate is the distribution and division of labor, and this fact, in turn, calls for better coordination, together with closer and stronger cooperation. 307 308 THE MANAGEMENT OF INSPECTION With these general observations as a guide we may proceed to design an organization for the inspection department, re- membering always that we are designing with men as our ma- terial, hence the design must conform to the capabilities of the men that are available, and furthermore it must be suited to the conditions imposed by the character of the work to be performed. The discussion that follows applies, as will be noted, to the organization of an inspection department for a large factory doing high-grade, interchangeable manufacturing, but the same principles apply in simpler cases, and the organization may be readily and suitably simplified for such situations. THE CHIEF INSPECTOR It is almost begging the question to say that if you have the right man at the head of the inspection department, your worries about the organization and management of that depart- ment are over. But what type of man is called ioi? The posi- tion is one of trust, hence character is an indispensable. Good judgment is requisite, not only the judgment that flows from "mechanical sense" and skilled ability as an engineer, but also plain "horse-sense." In addition, the man must be an execu- tive of no mean ability. Many persons have been so accustomed to regarding inspec- tion as one of the secondary features of manufacturing, that they fail to realize what complex and extensive organizations have been evolved for the inspection departments of large fac- tories. It is by no means an uncommon thing nowadays to find an inspector for every ten to twenty workmen, and the proportion may be much higher. In the Wahl Company, of Chicago, which manufactures, among other things, the "Ever- sharp" pencil, the proportion of inspectors is 1 to 8.6 workers.* In the S. K. F. Ball Bearing Co.'s plant at Hartford, where every operation is 100 per cent, inspection, 27 per cent, of all the productive workers are employed in the inspection department.! *Furnished through the courtesy of C. A. Prary, General Manager. tCourtesy of R. F. Runge, General Factory Manager of S. K. F. Industries, Inc. ORGANIZATION OF INSPECTION 309 Under difficult war conditions, the inspection department of one of the munition plants reached a total figure of 2,200 employees, and possibly there were larger inspection forces in other plants. But even under normal conditions, it will be recognized from the above figures that the head of the inspection department has an executive job of no mean size. The duty is very greatly enlarged and complicated, moreover, by reason of the fact that the inspection department is not concentrated into one definitely bounded shop, like the various production departments. On the contrary, its work reaches into nearly every part of the factory, and its personnel is widely scattered in consequence. The character of the work is at least as diversified as the processing, which fact still further complicates the problem; for the inspection force will have one group of workers in the wood- working department, for example; while at the other end of the plant it will have another group engaged in the inspection of metal parts made to standards of accuracy so precise as often to split thousandths of an inch. Therefore the Chief Inspector should be generally familiar with all shop processes, rather than a speciahst in a hmited number of them. Concurrently with selecting a man to take charge of the inspection department there arises the problem of outlining what this department is to include. Conversely, the amount of work that it is expedient to include will determine how big a man should be selected to head the work. The two things always go together, and the resulting solution is usually a compromise. The duties of the inspection department obviously will comprise a number of things that are not inspection, not even speaking strictly; but they will all be related to inspection, in the sense that it is economical to include them, and often wise to do so, in order to secure a more complete control of quality. In the first place, there will be the separate inspection forces for each main group of the factory's work, as in the case of an automobile factory making both trucks and passenger cars. Each of these main groups will be subdivided into an inspection force for each shop, or smaller factory unit,- including the assem- 310 THE MANAGEMENT OF INSPECTION bling shops. In addition to this inherent duty we may list the following: (a) raw-material inspection, including the necessary labo- ratories, chemical and physical; (b) heat-treatment inspection, including the metallurgical and metallographic laboratories; (c) tool-inspection, especially if the factory maintains a tool-making shop; (d) gage-checking and the verification of measuring stand- ards — all in close cooperation with the chief engineer; (e) general supervision of the assembling department, in some instances, where inspection in this department is of unusual value in guiding the work of the parts- making-shops; (f) general supervision of the factory salvage department, when it is specially desirable to safeguard production from the return of defective work into flow. The inspection of machine tools and similar factory equipment and buildings and their appurtenances has not been included as a possible assignment of the inspection department, for the evident reason that this constitutes, with the maintenance of such things, the principal duty of the works engineer. It will be carried out by the latter with due regard to the fact that every department in the plant will be "on his trail" if he over- looks anything that requires attention. The general test for deciding whether a particular branch of factory endeavor should be included in the inspection depart- ment will be simply this — "Will the Chief Inspector handle it to the advantage of the entire plant or not.^^ " — which, of course, depends, among other things, upon who and what the Chief In- spector is. Granting that you have settled upon the man and his job, the least important question of all is what you are going to call him, for the greater one's experience in factory work, the less will be the emphasis placed upon titles. Undoubtedly, the term in widest use to designate the head of the inspection de- partment is that of Chief Inspector. It has grown up in much the same way as the title of Chief Engineer, and it is possibly ^ S ul h 9 u S kl h- ^ ^0- 0:0 z S! iS - i 1 - ■^ r— 1 Z tf « z % z p INSPtCTlO G uJ ^&< u Sll 312 THE MANAGEMENT OF INSPECTION just as well to retain its use; although there are many organiza- tions in which the strict following of the plan used in the general factory organization chart would result in the more definite title of Manager of Inspection, or possibly that of Director of Inspection. This is a matter, however, as just stated, that is of little weight. But there is one of marked importance which should not be overlooked for a moment if the control of quality is to be assured — the Chief Inspector should report directly to, and only to, the highest executive authority in the manage- ment. THE LINE ORGANIZATION In outlining the organization under the Chief Inspector's jurisdiction, it is believed that the best result will be obtained by a combination of line and staff, as in the case of the general organization of the factory itself. The line organization will consist of the usual executive heads of the different groups of workers; i. e., general-foremen-inspectors; foremen-inspectors; subforemen or crib bosses, and so on, making up the "chain of command " through which instructions will pass from the Chief Inspector to the individual inspectors at the bench. It is to be understood that the Chief Inspector's Staff will consist of a few carefully selected specialists who have no execu- tive authority over the line executives other than that which naturally belongs to them by reason of the moral effect of their close association with the head of the department. It is generally conceded that no executive should have more than a limited number of subordinates reporting directly to him. This number varies with circumstances, but should not exceed ten or twelve at the outside in work of this kind, as there is such a volume of small questions requiring prompt settle- ment, to say nothing of the demands on the Chief Inspector's time for continuous constructive work. Therefore in a concern making several lines of product there should be an inspection superintendent (or a general foreman-inspector) in general charge of each such group of shops. The principal assistant to the Chief Inspector may very well be one of these superin- tendents. The above chart should have any other depart- ORGANIZATION OF INSPECTION 313 ments that may be assigned to the care of the Chief Inspector (such as the laboratories for raw material inspection, the gage checking dept., etc., added, as separate main divisions, on the line "a-b." The line "c-d" of the chart provides for a foreman-inspector in charge of each production department, and since inspection is best performed when strictly specialized according to classes or kinds of work, it is suggested that there be a separate foreman for each different kind of production department in the group, even if this results in considerable disparity in the sizes of the forces reporting to the various foremen-inspectors. Thus the foreman-inspector of the wood-working department in a small- arms factory may have several shop floors under his care, while the heat-treatment department's foreman-inspector has only one. In other words, the inspection organization should par- allel the production organization in this respect, rather than attempt to equalize the jobs by combining small departments under one head. It is specially essential in inspection work that foreman-in- spectors and their more important assistants have understudies designated. This arises from the fact that the personnel of the inspection department's supervisory force must be relied upon, to a large extent, to see that standards of quality do not shift. This statement holds good even when every care has been taken already, to fix the working standards as definitely as possible. In the work of keeping standards from shifting, the inspection foremen accumulate a large body of knowledge in the form of small details, which cannot be quickly passed on from man to man. They must be absorbed from contact with the work. It is, therefore, very important that the or- ganization provide for continuity in this respect, so that what might be called the complete standard will be carried along from shift to shift, and the gaps caused by the absence of any mem- ber of the supervisory force, safely bridged. If a foreman-inspector has a department which comprises several floors or shops, he will need an assistant in each shop. This man's duties, in addition to maintaining discipline, will involve a continuous checking-up of the inspection work going 314 THE MANAGEMENT OF INSPECTION on in the shop, deciding doubtful eases arising principally in the re-inspection of rejected work, overseeing the care of gages, and attending to the orderly storage of work in process. Each in- spection crib should have a working inspection boss — that is to say, one of the ablest inspectors working in the crib should be designated to assume general charge of all the work going on in the crib. The working force in each crib will consist generally of inspectors, counters, and a common laborer or two, especially if the boxes of work are heavy and if the flow of work is rapid. The counters are, of course, engaged in the work of checking up the quantity of work performed on operations that are not inspected, and are listed separately merely to indicate that this work should be performed at a lower rate of pay from inspection proper. In this connection it may be noted that a misunderstanding sometimes arises when the employment department hires men as inspectors, and the inspection department subsequently places them in central inspection cribs where they may have to do more physical handling and hfting of boxes of work than they do inspecting. The individual thinks he is going to be an inspector, but finds diflSculty in distinguishing between his work and that of a shop laborer. It is suggested that this trouble may be lessened by creating the position of assistant inspector, as an intermediate step between common labor and bench inspectors. If the employment department is careful to make clear to the applicant what his duties are to be, there is less chance of a misunderstanding later on. Central inspection is usually reinforced by a small group of floor inspectors. These men should be of a higher grade than the bench inspectors in the crib, and probably even more so than the working foreman of the crib, since their duties are more independently performed. Consequently, they should report directly to the assistant foreman in charge of inspection in the shop, and not to the crib foreman. THE CHIEF inspector's STAFF At the beginning of the preceding section of this chapter mention was made that the Chief Inspector's staff should have ORGANIZATION OF INSPECTION 315 no executive authority other than that which accrues to them by reason of their close association with the Chief Inspector. The latter fact will naturally give them all the prestige their work requires. The staff organization should be laid out along functional lines so as to provide a general service for the help and guidance of the hue executives. It must secure also, for the assistance of the Chief Inspector, an inspection of inspection, without destroying the individual responsibility or dividing the authority of the Chief Inspector's subordinate executives, which is one of the greatest dangers in large organizations of combined Hue and staff type. Thus each staff assistant will be a carefully selected specialist, combining the work of an instructor in his Hue of work with that of assisting the Chief Inspector in checking up his assigned part of the work throughout the entire department. In Hsting, just below, the staff duties to be performed, it is to be under- stood that some of them may be combined under one individual where the vohime of work warrants it : (1st) Personnel, including the investigation of questions affecting pay, promotion, discharge, assignment of new em- ployees, etc. This work usually requires the entire time of one man. . (2nd) Follow-up of technical instructions from the Chief Inspector's office to the inspection force, including checking up the adherence to prescribed standards. (3rd) Care, use, and custody of gages, including making sure that all gages pass through the gage-checking department as scheduled. (4th) Analysis of trouble reports from the foremen-inspectors, especially those relatmg to technical difficulties encountered in the parts-making shops and in the assembling department. This work includes the further investigation of some of the reports, also seeing that the more important ones are placed before the Chief Inspector to bring to the attention of the proper authorities in the general factory organization. (5th) Liaison duty with the production engineer to see that the inspection department is collecting production data for him in a satisfactory manner. 316 THE MANAGEMENT OF INSPECTION In addition, the Chief Inspector frequently has small techni- cal matters requiring the services of a junior engineer to con- duct the preliminary investigation. It is suggested that such men be taken from time to time from the rank and file of the inspection force, or from the laboratories. This practice will help broaden the men in question, and will accomplish the pur- pose just as well as if they were permanently assigned to the staff of the Chief Inspector's office. THE INSPECTION DEPARTMENT PERSONNEL Probably you have noticed that little has been said as yet about the qualities to be sought for, in choosing men for the duties of foremen-inspectors, their assistants, and the working inspectors. The problem is not one of choosing the kind of men you want, but rather one of making the best use of the men that are available. There is "history" in the statement, as more than one Chief Inspector can testify from sad experi- ence in recent years. The men who take employment in the inspection department may be classed along general lines as those who have previous experience in technical matters, and those who have not. If the experience of the former class has resulted in a self-sufficient knowledge, they should be replaced by men of the class who have no such technical experience, and know that they haven't it; because you must have inspectors who will follow your stand- ards without modifying them in the light of their previous ex- perience. In other words, obedience to orders is the prime de- sideratum. In assigning duties in the inspection department organiza- tion, therefore, it is necessary to place the personnel so as to grade the amount of discretion to be allowed in matters requir- ing the exercise of judgment. One might say that the amount or quantity of judgment to be applied by any individual mem- ber of the inspection force should be decreased as we go down the line from foreman-inspector to the inspector working in the crib. The inspector applying gages at the bench, or inspecting fin- ish as to sample, should be the kind of person who has reason- ORGANIZATION OF INSPECTION 317 ably good eyesight and tactile sense; but more tban this he must be temperamentally suited to doing exactly what he is told to do. This will consist in sorting the work he is inspecting into work that is clearly according to standard, work that is clearly not according to standard, and work about which he is doubtful; leaving the decision as to the latter class of work to his imme- diate superior. As stated before, this process implies reason- ably definite standards of quality in the first place. The floor inspector should be of an entirely different class. He has the important duty of first-piece inspection before he authorizes a machine to begin a run of work. In addition, he may be given the right to order a machine stopped if the work is not to his satisfaction. This calls for good judgment backed up by practical experience, hence the floor inspector is usually a first-class machinist to whom the title and duties of inspector may make an appeal, or who views this work as a step in the direction of a foremanship of some sort. Practically every large inspection department possesses a unique characteristic, and a very happy one. It is a veritable gold mine of men possessing unusual native ability and good character, but lacking experience in factory work. Every once in awhile, and for various reasons which do not matter, some man decided to make a radical change in his work. lEs very unacquaintance with factory life may be the source of his desire to try it, so he presently appears at the factory employment oflSce. Having no knowledge of machinery, he hesitates to attempt machine operation, even if the way is made easy for him to acquire the necessary sldll; but the title of inspector may make a special appeal both as a dignified occupation and as an opportunity to study manufacturing methods at close range. This is one explanation of why you find such men in the inspection department . The answer to where you will find them is, obviously, at the bench, usually working quietly but never- theless with their eyes open to what is going on around them in the shop. Unless the foreman is an unusually human sort of executive, he will fail to see the possibihties in these subordi- nates. Consequently, it usually is up to someone higher up to 318 THE MANAGEMENT OF INSPECTION find such men, and to see that they are given the chance they hoped for when they entered your employment. The circumstances just referred to may be well known to you already. It came to my attention for the first time a few years ago, in the course of reorganizing an inspection service of some two thousand employees, where an excessive labor turn- over in this department was considered to be one of the primary reasons for defective control of quality. The problem of reduc- ing the turnover was attacked by direct action — the Chief In- spector had a personal talk with every man entering or leaving the department. The experience was somewhat arduous, but this was more than offset by the results, which were felt almost immediately. One foreman-inspector, especially, complained regularly and frequently that the men supplied him were "no good." The foreman himself was a man of long experience in the business, and by reason of this fact seemed unable to adjust himself to circumstances under which he must train the men supplied him rather than expect to find them already skilled in their work. Most of the men leaving his department gave every reason but the right one for quitting, probably in the factory spirit of being good losers. Presently, however, a man appeared in the Chief Inspector's ofBce on his way out. Character and personality were written plainly on his face. Under pressure he told the story, and in a detail that showed a keen grasp of conditions. His story, briefly, was this: After leaving a semi-technical college course, he had taken a political job, and by an unlucky swing of the political pendulum, about fifteen years later, found himself under the necessity of seeking other means of support- ing his family. So he turned to this particular factory because he had heard of possible opportunities there. It looked to him like a fresh start with good chances for a satisfactory career. After three months at the bench as an inspector he confessed that he knew little more about the intricacies of the business than when he started. What he did know, he had been forced to dig out by himself without encouragement from above. On the other hand, he knew what was basically wrong in that shop better than the foreman-inspector himself. ORGANIZATION OF INSPECTION 319 This experience was the cause of starting a school for such men under an old foreman who possessed a heart as well as a head, and who passed on enough of his practical knowledge to enable his pupils to qualify as tool-setters and gang-bosses. After this, promotion was up to the individual, but he was al- ways encouraged to bring his problems back to the foreman- instructor for helpful advice. The man whose case was just referred to became assistant superintendent of a large produc- tion department in about six months from the time that he was ready to give up in disgust and discouragement. Several other men found, or perhaps I should say discovered, in the same way, were developed into excellent foremen instead of being lost to the organization. All of which goes to show that while the individual unit of an organization may be part of a machine in one sense, he nevertheless is a man, with all of the perfectly natural limitations and variable potentialities of a human being. I venture to say that there is nothing in the entire work of organizing and running your inspection depart- ment (not to mention the rest of the factory) that will yield so large a return, both in actual accomplishment and in personal satisfaction, as the study of the men themselves. (a) The Task The chief end to be sought in the management of the inspec- tion department is to obtain a firm control of quality by holding the work to definite, pre-determined standards; and to accom- plish this with the maximum of economy. The task presents at least two essential differences from the management of a production department of commensurate size: (1st) The working force is widely scattered and the work unusually varied. Coordination is diflBcult. (2nd) The pay of inspectors is nearly always low in propor- tion to their responsibilities, with attendant difficulty in attract- ing and keeping the right kind of labor. (6) Coordination The first step in coordinating the work of the inspection de- partment is to see that the Chief Inspector's office is located as 320 THE MANAGEMENT OF INSPECTION nearly as may be in the center of the plant. The inspection force is concerned with every manufacturing process going on in the factory, and with many of the general service depart- ments. It reaches into every part of the plant. Questions arise every hour of the day that call for settlement by personal conference with the Chief Inspector or some member of his staff. Much time and effort will be saved by lessening the average distance to the point of trouble. Furthermore, it is greatly to be desired that both production and inspection de- partment executives feel that the Chief Inspector is one with themselves in close contact with the work, as well as being readily accessible to them. His job is not in the front office, but rather is it in the very heart of the work. In coordinating the efforts of his own executives, the Chief Inspector will find use for all of the ordinary devices of good management. He will find conferences with his superintend- ents and foremen of special value. Incidentally, the main purpose of the conferences will be obtained more surely if the Chief Inspector does not do all the talking. The men in the room will be brought together better if they come to accept the conference as an opportunity to obtain the help of several minds in working out their immediate and most baffling problems. The Chief can soon develop good fellowship and a common interest in the work of the entire in- spection department by a little adroit steering. A conference with his immediate subordinates once a week will be sufficient under ordinary circumstances, but it is sug- gested that this practice be supplemented by an occasional conference with the inspection executives of each inspection group, for the principal purpose of developing a closer personal contact and acquaintance between the subordinate executives and the chief of their department. For the inspection depart- ment should be in harmony with the Chief's policies and there- fore quick to react to his instructions as they are passed down the line. Such flexibility of control will be strengthened more certainly by personal acquaintance; and by frequent contact, the personality of the head of the department will be reflected by the department as a whole. ORGANIZATION OF INSPECTION 321 It will be found to be an excellent plan, in coordinating the various units, if each foreman and stail employee is supplied with a simple letter-size binder for keeping a file of department bulletins. These bulletins should be issued from time to time from the Chief Inspector's office as a quick means of conveying his executive instructions to the entire organization, defining his policies, and supplying technical information. The book should be kept on the foreman's desk for the sub-foremen to read, and it should be the duty of one of the staff assistants to question the sub-foremen occasionally, so as to encoiu-age them to keep in touch with the plans and policies of the department. The scheme will not work unless it is closely followed up, but it can be made a most potent force in keeping men "on their toes" and working harmoniously, especially if the bulletins or in- struction notices are explained and discussed in conference. Finally, it is in the general work of helping to keep the entire department pulling together smoothly that the members of the Chief Inspector's staff will justify their employment. To make their work most effective, the Chief should encourage them to confer with him. Whenever practicable they should make their headquarters in the Chief's office. (c) Reduction of the Turnover No matter how thoroughly standards of quality are specified, there is a certain amount of incompleteness that is bridged only by the accumulated experience of the inspector. Then, again, it requires a varying length of time for any inspector to acquire the technique necessary to apply a given gage with the desired accuracy and skill; or to satisfactorily conduct any given in- spection operation. Because of these reasons it is important that the personnel of the inspection force be as permanent or more so than that of other departments if standards of quality are to be prevented from fluctuating. This is in addition to the usual loss in quantity of work performed due to excessive labor turn- over in any class of work. The disparity in pay already referred to is a disturbing element; and the turnover in a large inspec- tion department is likely to be unduly high in consequence. Obviously, the primary action to take in order to stabilize 322 THE MANAGEMENT OF INSPECTION conditions is to employ people for inspection work who are most likely to take to it kindly. For example, the inspection work is usually less strenuous then the operation of manufactur- ing machines; which indicates the employment of people (frequently women) who cannot stand the physical strain of the heavier production work, and know it. When a relatively high degree of experience and skill are re- quisite, as in the case of floor inspectors, there should be assur- ance that the inspection force will share in promotions to assis- tant foremanships in the production departments, so that the inspector has something to look forward to when higher vacan- cies are to be filled. Then, again, resort must be had to every possible non-financial incentive, since the easier way of the direct financial incentive is barred. That is to say, in brief, that the inspection depart- ment must be handled so that it will come to be recognized as an excellent place in which to work; and, more important yet, a force that a man should be proud to belong to. The work can be made pleasant if the inspector is treated by his executives with just a little more friendliness and courtesy than is custom- ary in shops. I do not mean to imply, however, that his job should be made a soft one. On the contrary, the spirit of the organization, and hence the dignity of the work, will be greatly enhanced by stressing the value of character, by cultivating a pride of achievement in terms of accuracy, and by a rigorous demand for personal responsibility. But all of this should be tempered by a very obvious interest, on the part of the Chief Inspector and his assistants, in the personal welfare and interest of everyone in the department. If this takes only the form of an evident willingness to help the other fellow to help himself, the object sought will be attained. All parties gain: the executive by having a more contented and efficient force, and the subordinate by having a conscious increase in satisfaction in his work, through the knowledge that his value to himself and to others is increasing. (d) Wages and Working Hours Owing to the fact that it rarely is practicable to measure the ORGANIZATION OF INSPECTION 323 work performed by inspectors, it is the general practice to pay them on the day- wage or hourly-wage basis. It frequently occurs that the inspection work must be performed in a shop where the machine-operators are paid on a piece-work or similar system based upon the quantity of work performed. Hence it is not unusual to find a situation arising where ordinary machine- operators are paid at rates considerably in excess of the men who inspect their work; and under such circumstances, there is more than the usual diflSculty in keeping the inspection force in a contented frame of mind. The easiest apparent cure is to raise the wage scale for in- spectors, but that way is not open, in spite of the fact that they perform work that is worth enough to warrant a higher scale in many cases. An economy in total cost might conceivably be attained thereby; but in nearly every plant inspection is regarded as a necessary but regrettable and non-productive expense. Consequently, the Chief Inspecior is faced with the problem of doing the best he can with a strictly limited pay- roll, and therefore is forced to use the lowest rate of wages that will keep him supplied with a grade of labor that will do. As a result the Chief Inspector and his foremen will be be- sieged with requests for raises in pay, and a relative degree of contentment can be obtained only by having a definite rate of promotion with graded rates of pay based upon length of ser- vice, in combination with efficient work. This, I believe, has been found to be the best solution under the day-wage system for all kinds of work. I have seen the labor turnover actually decreased by the flat announcement that no increase in pay would be considered for sixty days; and this, in the face of in- sistent demands for raises. In this instance, however, there had been no systematic arrangement for graded increases, so that the practice of asking for raises had grown up, with the net result that the granting of one request only served to encourage others. It is believed that inspectors working on small pieces can be paid piece-work to advantage in many more cases than would ordinarily be supposed; but this system, obviously, can only be used to advantage when the work warrants a check inspection, or inspection of inspection by sampling all work after the piece- 324 THE MANAGEMENT OF INSPECTION working inspectors have gone over it. When this can be done without sacrificing quahty, the usual economy inherent in the piece-work system will be experienced, although the individual worker makes more money. Inspectors employed on piece- work, however, must be penalized strictly by non-payment for any boxes of work found to contain defective parts; and, less heavily, for the rejection of good parts. Another potential source of discontent arises from the fact that some of the inspection force, at least, should be on hand both before and after the regular working hours. It is espe- cially important that the inspection cribs be ready to issue work before the beginning of work in the shop, in fact, sufficiently early to see that all machine operators are supplied with work well ahead of time. Otherwise, the production force have a valid cause for complaining that they are delayed in getting to work promptly. Then again, it is often desirable to clean up the inspection of work that is turned in at quitting time. "When choke-points occur this may be imperative. The sugges- tion is offered that much unnecessary hard feeling can be stopped by a definite understanding, at the time of employment, that the working hours of inspectors will be staggered a little out of phase with the regular shop working hours. The total time can be adjusted by allowing a longer time for lunch and by a reasonable leniency in days off. The time outside of regu- lar hours need not exceed fifteen minutes in most cases, so that adjustments of total time are not difficult. Needless to say, overtime should be avoided with care, as both costly and con- ducive to the creation of needless overtime. {e) The Cost of Inspection Most Chief Inspectors will agree that the average foreman- inspector, by reason of his being a foreman-inspector and con- currently with his assumption of that duty, at once acquires an unusual ability to ask for more inspectors, and for better in- spectors, and for more gages. Now as all of these things cost money, which is a relatively rare commodity in so far as the Chief Inspector's disbursements are permitted to go, some other way out must be found. For example, the foreman may be ORGANIZATION OF INSPECTION 325 shown that "more men" does not necessarily mean a correspond- ing increase in the amount of work performed. Thus in Fig. 2 (in which the abscissae represent the total number of men in the working force, and the ordinates represent the total amount of work performed) it is not unnatural to assume that output will increase in direct proportion to the number of people en- gaged in the work, as shown by the line OA. As a matter of fact, a little consideration will show that the curve O B C is more nearly true for any given job; for Number of men employed Fig. 2. This chart demonstrates that there are definite limits, for a given output of an in- spected product, control] ing the number of inspectors that may be profitably employed the reason that a point B is soon reached where additional help only interferes with the people already at work, until at C the shop is so crowded that no one can move, and the output returns to zero again. Hence it follows that for any given output O D there are two limiting numbers of men, D E and D F, It is the painful lot of the inspection de- partment to work a little inside of the number of men indicated by the point E {i. e., at P). This may not be entirely convinc- ing to your foremen, but it at least shows them what they are up against in asking for more men. Rather than more men, then, it is a matter of increasing the eflSciency of the allowable force; at which point, it may be noted as a fortunate circumstance, that inspection work lends itself readily to very marked economies in the way of greater output per man, through the appUcation of many of the devices of 326 THE MANAGEMENT OF INSPECTION modern methods of management. This is especially true of bench inspection, under the conditions of central inspection. The first of these is a carefully planned use of sampling; so that no more work i? done than is necessary. Next comes the mat- ter of instruction in the work of inspection, to see that each in- spector knows just what he is trying to do, and the quickest and easiest way to do it. There are so many operations in inspection work that seem very simple that there is a strong tendency to show a new employee what he has to do in a very general sort of way, and then leave him to his own devices. The application of a gage or two, or a viewing for surface finish appears to be transparently easy; but the mental attitude that views any piece of work as simple is a danger signal, for it is time to recall that time and motion study began with handling pig- iron and shoveling earth. It is not unlikely, in fact, that their most striking economies are realized in the most simple opera- tions. The instruction of inspectors is a staff job — that is, it should be, if the best results are to be obtained. Perhaps this flows from the proverbial truth that work that is left to everybody is rarely done right. It should be combined with the work of one of the technical men on the Chief Inspector's staff, as it fits in well with a critical examination of each inspection point taken seriatim and carried on in accordance with a programme somewhat as follows : (1st) Is the measuring device, gage, or what not, such that true results can be obtained .^^ (2d) Is the gage being applied so as to obtain true results.'' (3d) Is the work being done in a way to secure the greatest economy of inspection .^^ The first two questions are vital, naturally, since money spent upon inspection is worse than wasted if the results are not close to the truth. The third question opens up the whole field of possible increase of efficiency. Frequently, in fact very fre- quently, the most cursory use of motion study reveals large possibilities for saving time in inspection, especially if the in- spector considers himself under the necessity of hurrying. The most frequent loss arises from improper placing of the boxes of ORGANIZATION OF INSPECTION 327 work, so that unnecessary and crossing motions are made. Then there are the losses that arise from awkward posture and clumsy holding of the gage. It sometimes happens that a separate support for the gage will help matters by leaving both hands free. If so, then attention should be given to seeing that the support is flexible enough to permit automatic adjustment of a close limit gage to the work. Right here is a good place to mention the big saving that such a staff assistant can secure by spreading the message of careful handling of both work and gages. Precision instru- ments and fine work call for a certain amount of gentleness, of the type that a certain French fencing master referred to, when he said "Hold your foil as you would a bird, firmly, so it will not escape; gently, so it will not be hurt." I recall an experience in a munition plant, where a room full of foreign help was engaged in the inspection of high-grade work. The gages were applied with such enthusiasm, and highly finished parts were thrown into tote boxes with such vigor, that the anvil chorus would not have had a chance to be heard. The ordinary bench-inspector or machine-operator in our larger factories will easily fall into almost as bad habits, unless he is cautioned from time to time. Turning now to one of the greatest economies in inspection, especially in central inspection as previously stated: it is not necessary (except in certain kinds of floor inspection) to have mechanics skilled in the work of inspection. In fact, it is quite inadvisable to employ such people when you are trying to limit the use of judgment and to hold to a close standard. But the employment of unskilled help again indicates the necessity of providing adequate instruction; not alone by teaching, which always should be a large factor in management, but also by providing accessible reference data, such as samples, large-scale drawings with gaging points distinctly marked, gage instruction cards, and so on. It should not be necessary to mention, except for completeness, how important it is to begin this educational work as soon as the new inspector is employed. There are obvious advantages in "catching them young." The work will be done more certainly, and probably better and quicker, if it is followed up by a staff assistant. 328 THE MANAGEMENT OF INSPECTION (/) Female Labor for Inspection Work In speaking of the use of unskilled labor as a measure of "econ- omy in inspection, the question of using female labor deserves serious consideration. In fact, if female labor is carefully se- lected with reference to the adaptability of the individual to the class of work involved, it will be found that women are able to do many more kinds of inspection work than might be sup- posed, also that they almost invariably perform it better. You will be able to secure a higher grade of tactile sense and skill for the same investment, together with a stricter compliance with your instructions in the matter of holding to standards. The advantage to be gained in greater contentment of the inspection force alone makes the employment of women highly desirable whenever possible. It is realized that many factory executives hesitate to intro- duce women into the inspection department in shops where none but men are employed at the machines, and this for reasons quite apart from their suitability for such inspection work. It may be stated as a fact, however, that the feeling is not war- ranted, if proper measures are taken at the start to maintain discipline; for the presence of women may be made to secure an elevation of the tone of the entire establishment. To do this requires that the subordinate inspection bosses be chosen from among the most dignified inspectors, and that they be duly impressed with the importance of their work. It should be made a fixed rule also that questions affecting inspection be taken up by the production bosses with the male foremen only. In a large factory employing at the time none but men in the shops, female help to the number of several hundred were intro- duced into the inspection department in the endeavor to stabil- ize labor turnover in the department as well as to secure better control of the technique of inspection. The class of labor in the plant was such that the management realized that matters might arise that would be reported to them more certainly, and perhaps more easily and gracefully, if the women could carry their troubles to a woman rather than to a man; for it was recognized that a high standard of character in the inspection ORGANIZATION OF INSPECTION 329 department was worth a great deal in controlling the quality of the factory output. With this in mind, one of the secretaries in the main office, who had been a working-girl and who possessed rare good judgment combined with a very human sym- pathy for her associates, was asked to take the time to become acquainted with at least one or two girls in each inspection group. The plan proved to be an unqualified success, although it resulted in separating a foreman or two and a few of the in- spection force from the organization very shortly after the facts began to come in and investigations were made. It was not very long, however, before that particular plant achieved the reputation among working people of being the safest factory in the state to which to send their daughters for employment. Women as inspectors will be found to work faster than men, especially if their strength is conserved by providing men to do the heavier work of lifting and moving tote-boxes. The amount saved is sufficient to pay for the greater comforts in the way of chairs, recreation and rest rooms, etc., that must be provided for women. It should be remembered, however, that women inspectors should be required to adapt their dress to secure personal safety, by wearing caps and suitably protected sleeves, as in the case of female machine-operators; for inspect- ors are occasionally passing near machinery in motion. From the technical standpoint, there are many kinds of work not ordinarily inspected by women that could be so handled to advantage, even in the case of comparatively heavy pieces. This requires that the individual be chosen for the job and given a preliminary course of training. The inspection of the interior of rifle barrels has been performed by women to great advantage although it is technically difficult, and the physical work of holding them up to the light is tedious, to say the least. In the case I have in mind, the inspectors were chosen from among a number of obviously robust and sturdy individuals, whose eyesight measured very nearly perfect. They were then in- structed in the art by an expert foreman who believed that women could he taught to do the work. It took ten days to grad- uate them, and it only remains to be stated that they developed a proficiency that set too high a standard at first. It would. 330 THE MANAGEMENT OF INSPECTION in fact, have tied up production if prompt measures had not been taken to re-inspect their rejects, until they could be taught to hold to a more reasonably commercial standard. And in spite of this experience, the scheme was nearly wrecked by their inspection foreman (a man of long experience and great skill in the business) who stubbornly refused to believe that women could learn in so short a time work requiring such skill. From this you may deduce the reason for emphasizing certain words in this paragraph, or possibly confirm your own conclusion that there is more than a modicum of "bunk" about many "skilled" operations, so called. (g) Morale No treatment of the management of the inspection depart- ment should close without stressing the special value of a high morale. Just as the accuracy of measuring instruments is fundamental in determining the degree of mechanical accuracy that may be attained, so must the inspection force's fidelity to truth be developed to secure the predetermined standard of quality that is desired. Thus character is the first desideratum, and as a part of it, impartiality, thoroughness, and accuracy in developing the real facts; and courage in bringing them to light. The Chief Inspector must train his people to secure this result; and then, lest he lose the advantage, he must back them up when they are right, and must, in his turn, be backed up by his superiors in the management. Concurrently, the inspection force should be disciplined to a strict obedience in carrying out the Chief's instructions, if for no other reason than to secure a quick flexibility and certainty of control in developing the standards of quality, with freedom from disturbing influences arising outside of the inspection department. The presence of this same discipline, administered always with personal courtesy, will build up the individual's sense of the value of his work to the entire organization; and with the resulting realization of personal dignity and knowledge of trust, there will come a feeling of responsibility and pride in the work of the whole department — ^that is to say, an esprit de corps. INDEX Albro, William H., on idleness, 267 Analysis, Improving shop methods by, 185 Annual inventory. Methods of takmg, 60 Balance-of-stores clerk's duties, 75 Balance-of-stores record. Operating, 75 Balance-of-stores sheet. Use of, 78 Bennie, J. A., on time-study, 109 Bernstein, Philip, on group time-studies, 155 Bernstein, Philip, on time-study, 138 Bullard, S. H., on organization, 1 Bullard Machine Tool Company organiz- ation, 1 Bullard maxi-pay bonus plan, 8 Bullard maxi-pay wage plan, 8 Chief inspector. Duties of, 308 Cost of inspection, 324 Coxmcil, plant executive, 2 Cubberley, A. H., on time-study, 130 Culver, H. G., Stock system, 52 Department system. Planning, 215 Departmental organization, 209 Design, Discovery of faults in, 190 Employing department. Function of, 6 Equipment department. Function of, 4 Estes, L. v., on analysis, 185 Estes, L. v., on "Patrolling supervision," 173 Estes, L. v., on shop order system, 224 Expense orders. Use of, 101 Factors effecting shop order system, 239 Farnham, Dwight T., A moderate-sized factory, 10 Farnham, Dwight T., on piu-chasing, 89 Fatigue factors, 207 Foimdry department. Function of, 5 Fimction of plant executive council, 3 Functions of an industry. Splitting up, 26 Gerber, Samuel R., on time-study, 117 Green, J. D., on inventory, 74 Hathaway, H. K, on progress sheets, 293 Hathaway, H. K., on routing, 279 Idleness, Preventing man and machine, 267 , . Inspection, Coordinating with production, 255 ... Inspection department, Organizmg and y managing, 307 Inspection department personnel, 316 Inspection, Line organization of, 312 Inspection, Planning for, 198 Inspection trouble reports, 256 Inspectors' wages and working horn's, 322 Instruction cards for operators, 178 Inventory, Checking record with physical, 59 , „ Inventory, Correcting by "Double-bm system, 87 j »> Inventory, Correcting by "Item-a-day system, 87 Inventory, Cost of taking, 72 Inventory, Methods of summarizing, 67 Inventory organization and instruction. Inventory, Policy in valuing, 98 Inventory, Preparing for, 70 Kist, Charles, on stores system, 43 Machinery, Analysis of, 194 Material, Choice of by analysis, 191 Mental specialization, 21 Metallxu-gical department, Fvmction of, 5 Method of mapping routine, 222^ Moderate-sized factory. System in, 10 Monthly inventories. Methods of taking, 60 Operation analysis, 229 Operations, Analysis of, 201 Operations, Quantitative measurement of, 201 , . r^ , Organization, Bullard Machme Tool Company, 1 Organization, Errors in, 23 Organization, Main factors to be con- sidered, 28 S31 J32 INDEX Organization service department. Func- tion of, 6 "Organizing," Distinction between "or- ganization," 18 "Patrolling supervision" — a new fore- manship, 173 Perpetual inventory, 50 Perpetual inventory from cost record cards, 70 Perpetual inventory. Margin of error in, 86 Perpetual inventory. Method of checking, 100 Planning, Fimdamental principles govern- ing, 228 Plant operation department. Function of, 5 Production department. Function of, 3 Production order routine. Graphic plan- ning of, 218 Production quantities. Determining, 197 Production, Time-study as the basis of, 109 Progress sheets. Evolution of, 293 Pm-chase order. Form of, 45 Pm-chase requisition. Form of, 44 Piu-chase requisitions. Requirements of, 32 Purchased material. Maintaining proper stock of, 36 Pmchased materials. Reporting received, 56 Purchases, Bonus and penalty for de- livery, 32 Piu:chasing department, organizing, 29 Piu-chasing, Following up orders, 30 Purchasing fimctions shown geograph- ically, 219 Purchasing, Requirements for smooth deliveries, 31 Purchasing, Standard practice for, 89 Purchasing to specification, 38 Quality control, 211 Quantity control, 210 Radford, George S., on inspection, 255, 307 Reorganization of small plant, 11 Routine of stores department, 43 Routing multi-part mechanism, 279 Russell, H. A., on inventory, 60 Shop functions. Defining, 208 Shop layout. Arranging, 197 Small, G. Sumner, on organization, 18 Small, G. Sumner, on purchasing, 29 Special equipment. Avoiding, 192 Special orders. Detriment in, 27 Specialization of operations, 19 Specialization of operations. Dangers of, 21 Specialization of products handled, 20 Standard practice instructions, 176 Standard practice instructions. How to write and use, 165 Standard practice. Methods of instituting, 166 Standards department. Function of, 4 Standards, Determining time-studies, 110 Standardization of parts, 189 Standardization of tools, 241 Standardized processes, Using, 193 Starker, C. W., on tool organization, 240 Stock chasers. Experiences with, 104 Stock, Factors affecting the ordering of, 83 Stock goods pm-chased. Determining or- ders for, 37 Stock materials. Methods of ordering, 53 Stock, Standard maximmn and minimum, 102 Stock system. Basis of success of, 50 Stock system. Requirements of, 52, 92 Stores credit slip, 81 Stores, "Double-bin" system of inven- tory, 87 Stores, inventory value of, 98 Stores, "Item-a-day" system of inven- tory, 87 Stores system. Details of, 43 Superintendent, Relief from routine, 12 Supervision, Comparison of types of, 180 Technical processes. Analysis of, 198 Time-studies, Group, 155 Time-study, A four-watch board, 130 Time-study, Analyzing design and meth- ods, 113 Time-study as a basis for production, 109 Time-study, Detailed example of, 114 Time-study, Detailed investigation in, 120 Time-study, Filing and burring, 149 Time-study, Improvements in, 130 Time-study in small-part manufacture, 138 Time-study, Instructing the operator, 138 Time-study man. Obtaining confidence, 137 Time-study man. Qualifications of. 111 Time-study of automatic screw machines, 151 Time-study of cornering and polishing, 150 Time-study of drilling, 141 Time-study of drop forging, 150 Time-study of hand milling, 149 Time-study of inspection, 149 INDEX 333 Time-study of power milling, 145 Time-study of profiling machines, 143 Time-study, Reading continuously run- ning watches, 133 Time-study, Routine procedure for, 118 Time-study, Six fimdamentals of, 117 Time-study, Writing up the analysis and instruction, 127 Tool cost. Reducing, 253 Tool department operations, 240 Tool supervisor. Duties of, 254 Tools, Analysis of, 196 Traditional supervision, 174 Travel-line charts, 221 Van De venter, John H., on department systems, 215 Worcester, Willard S., on standard prac- tice instruction, 165 Works engineer, Function of, 5 THE COUNTRY LIFE PRESS GARDEN CITY, N. Y. A-. I ff L1 4lll ''Iff ^^ rf 4'i!CT ' ''mm i I 4. .i.|||^4i|ij,.f!|tj,^,|,; 'if