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Systematic Management: Design for Organizational Recoupling in American Manufacturing Firms

Published online by Cambridge University Press:  24 July 2012

Joseph A. Litterer
Joseph A. Litterer
Affiliation:
Associate Professor of Business Administration, University of Illinois
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Abstract

In developing techniques and guides for many of the regular or routine activities of managers, the Systematic Management movement of the late nineteenth century performed an important service for American business. The movement's response to breakdowns in the internal co-ordination of manufacturing firms was especially significant and forms the basis for Professor Litterer's analysis of the relevant literature.

Type
Research Article
Information
Business History Review , Volume 37 , Issue 4 , Winter 1963 , pp. 369 - 391
Copyright
Copyright © The President and Fellows of Harvard College 1963

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References

1 Atkinson, Edward, The Distribution of Products (New York, 1885), p. 62Google Scholar; Orcutt, H. F. L., “Machine-Shop Management in Europe and America,” Engineering Magazine, vol. XVI (January, 1899), p. 549 (February, 1899), p. 706, vol. XVII (June, 1899), p. 384Google Scholar; “A French Engineer on American Shop Management,” American Machinist, vol. XXI (January 20, 1898), p. 45Google Scholar; Outerbridge, A. E. Jr., , “The Future of American Industries,” Journal of the Franklin Institute, vol. 143 (1897), p. 110CrossRefGoogle Scholar.

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3 Lewis, J. Slater, “Works Management for the Maximum of Production: Organization as a Factor of Output,” Engineering Magazine, vol. XVIII (October, 1899), p. 59Google Scholar.

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7 Tregoing, John, A Treatise on Factory Management (Lynn, Mass., 1891), p. iiiGoogle Scholar.

8 For more detailed examination of the conditions facing firms at this time and what the authors of the period thought to be wrong with management, see Litterer, Joseph A., “Systematic Management: The Search for Order and Integration,” Business History Review, vol. XXXV (Winter, 1961), pp. 461–76CrossRefGoogle Scholar.

9 See for example, Perronet, Jean Rudolphe, “Art de l'epinglier par M. de Resumuir, avec des remarques de M. Duhame du Monceau et des remarques et traités des Memoires de M. Perronet, Inspecteur General des ponts et chausśees,” in Descriptions des arts et des metiers, Faites et approuvés par Messieurs de l'Academie Royal des Sciences (vol. I, Paris, 1861)Google Scholar; Smith, Adam, Wealth of Nations (London, 1776)Google Scholar; and Babbage, Charles, On the Economy of Machinery and Manufacturers (London, 1832)Google Scholar.

10 With so much of current managerial practice and techniques having been developed and/or studied in manufacturing industries (e.g., the work of Taylor and the Scientific-Management movement, the Hawthorne studies by Mayo and Roethlisberger) the student of management history has reason to look for the roots of current practice in these industries. Actually, examining the company contacts of the authors writing the literature referred to in this paper, identifying the firms referred to, and the illustrations used in this literature, it should perhaps be more specifically described as dealing with the manufacturing industries most concerned with the design and manufacture of metal products; i.e., machine-tool manufacturers, metal-household-appliance manufacturers, such as sewing machines, hardware manufacturers, armament manufacturers, and the like. It should also be noted (as will be established in later portions of this paper) that the practices and techniques described as Systematic Management arose in response to conditions which could occur in almost any industry and are not the unique properties of the manufacturing industries, let alone unique to metal-working industries.

11 Litterer, “Systematic Management: The Search for Order and Integration,” pp. 462–68.

12 Orcutt, H. F. L., “Machine-Shop Management in Europe and America, VI: Comparison as to Efficiency of Machinery and Methods,” Engineering Magazine, vol. XVII (June, 1899), p. 384Google Scholar.

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14 Op. cit.

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16 Op. cit.

17 Op. cit.

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19 Op. cit.

20 See for example Metcalf, “The Shop-Order System of Accounts,” p. 441.

21 Roland [Arnold], “An Effective System of Finding and Keeping Shop-Costs,” p. 77.

22 Some of this is stated directly and clearly in the literature. Other aspects of this vertical breakdown are inferred from statements made as to what should be improved or created in business firms. See for example, Litterer, op. cit., pp. 469–71; Robinson, Austin, “The Problem of Management and the Size of Firms,” Economic Journal, vol. XLIV (June, 1934), p. 242CrossRefGoogle Scholar; Rolf, N. F., “Management and the Size of the Firm,” Review of Economic Studies, vols. XVIII–XIX (1949–1953), p. 148Google Scholar.

23 Admittedly, this linking is not always as direct as in the illustration. However, even when much more indirect or round about it always exists.

24 Although using different terms this general point is made by Homans, George in The Human Group (New York, 1950), esp. pp. 101–103Google Scholar.

25 The journals surveyed in this study were examined back to their inception or at least until 1820 if that occurred later.

26 “Shop Systems of the Yale Lock Mfg. Co.,” American Machinist, vol. V (February 18, 1882), p. 6Google Scholar.

27 Ibid., p. 7.

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29 R. F. Van Doom, “A Complete System for a General Iron Works,” in Arnold, The Complete Cost-Keeper, p. 143.

30 Tregoing, Treatise on Factory Management, p. 1.

31 Diemer, Hugo, “The Commercial Organization of the Machine Shop, II: The Production Department — Bills of Material,” Engineering Magazine, vol. XIX (July, 1900), p. 511Google Scholar.

32 Op. cit., p. 83.

33 Metcalf, Henry, Cost of Manufacture and the Administration of Workshops, Public and Private (New York, 1885), chap. 12, esp. pp. 152–56Google Scholar.

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37 Church, “The Meaning of Commercial Organisation,” p. 391.

38 Arnold, The Complete Cost-Keeper, p. 16.

39 Shaw, A. J., “Machine-Shop Time and Cost Accounts,” American Machinist, vol. IX (April 3, 1886), p. 3Google Scholar.

40 Op. cit., chap. 12, pp. 151–67.

41 Binsse, op. cit., p. 380.

42 It should be noted here that we are examining the use rather than the formulation of policies.

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48 For some discussion of these limitations, see Schloss, David F., “The Basis of Industrial Remuneration,” Economic Journal, vol. II (December, 1892), p. 608CrossRefGoogle Scholar; Lewis, J. Slater, “Work Management for the Maximum of Production, II: The Labour Factor in the Intensification of Output,” Engineering Magazine, vol. XVIII (November, 1899), p. 201Google Scholar; Gilman, Nicholas P., Profit Sharing Between Employer and Employee (New York, 1891), p. 44–45Google Scholar.

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51 For an interesting early history, the reader is directed to Taylor, Sedley, Profit Sharing (London, 1884)Google Scholar.

52 This more cumbersome term, “Administrative Systems,” is used rather than just “systems” to avoid confusion with many other uses of this word, such as social “systems.”

53 Lewis, J. Slater, The Commercial Organization of Factories (New York, 1896), p. 209Google Scholar.

54 Arnold, The Complete Cost-Keeper, chap. 4, esp. pp. 24–26.

55 Van Doom, “A Complete System for a General Iron Works,” p. 143.

56 Diemer, “The Commercial Organization of the Machine-Shop, II: The Production Department — Bills of Material,” p. 511.

57 See for example Burton, C. A., “Machine Shop Cost and Time Accounts,” American Machinist, vol. IX (May 8, 1886), p. 6Google Scholar or “Shop Accounts and Management,” American Engineer, vol. XII (December 22, 1886), p. 236Google Scholar.

58 See for example Van Doorn, “A Complete System for a General Iron Works,” p. 143.

59 Diemer, op. cit.

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64 In addition to earlier portions of this paper, see Litterer, op. cit.

65 Gunn, James N., “Cost Keeping: A Subject of Fundamental Importance,” Engineering Magazine, vol. XX (January, 1901), pp. 703–704Google Scholar.