Shop Management | Page 8

profit sharing, has entered the mind of every student of the subject as one of the possible and most attractive solutions of the problem; and there have been certain instances, both in England and France, of at least a partial success of cooperative experiments.
"So far as I know, however, these trials have been made either in small towns, remote from the manufacturing centers, or in industries which in many respects are not subject to ordinary manufacturing conditions.
"Cooperative experiments have failed, and, I think, are generally destined to fail, for several reasons, the first and most important of which is, that no form of cooperation has yet been devised in which each individual is allowed free scope for his personal ambition. Personal ambition always has been and will remain a more powerful incentive to exertion than a desire for the general welfare. The few misplaced drones, who do the loafing and share equally in the profits with the rest, under cooperation are sure to drag the better men down toward their level.
"The second and almost equally strong reason for failure lies in the remoteness of the reward. The average workman (I don't say all men) cannot look forward to a profit which is six months or a year away. The nice time which they are sure to have today, if they take things easily, proves more attractive than hard work, with a possible reward to be shared with others six months later.
"Other and formidable difficulties in the path of cooperation are, the equitable division of the profits, and the fact that, while workmen are always ready to share the profits, they are neither able nor willing to share the losses. Further than this, in many cases, it is neither right nor just that they should share either in the profits or the losses, since these may be due in great part to causes entirely beyond their influence or control, and to which they do not contribute."
Of all the ordinary systems of management in use (in which no accurate scientific study of the time problem is undertaken, and no carefully measured tasks are assigned to the men which must be accomplished in a given time) the best is the plan fundamentally originated by Mr. Henry R. Towne, and improved and made practical by Mr. F. A. Halsey. This plan is described in papers read by Mr. Towne before The American Society of Mechanical Engineers in 1886, and by Mr. Halsey in 1891, and has since been criticized and ably defended in a series of articles appearing in the "American Machinist."
The Towne-Halsey plan consists in recording the quickest time in which a job has been done, and fixing this as a standard. If the workman succeeds in doing the job in a shorter time, he is still paid his same wages per hour for the time he works on the job, and in addition is given a premium for having worked faster, consisting of from one-quarter to one-half the difference between the wages earned and the wages originally paid when the job was done in standard time. Mr. Halsey recommends the payment of one third of the difference as the best premium for most cases. The difference between this system and ordinary piece work is that the workman on piece work gets the whole of the difference between the actual time of a job and the standard time, while under the Towne-Halsey plan he gets only a fraction of this difference.
It is not unusual to hear the Towne-Halsey plan referred to as practically the same as piece work. This is far from the truth, for while the difference between the two does not appear to a casual observer to be great, and the general principles of the two seem to be the same, still we all know that success or failure in many cases hinges upon small differences.
In the writer's judgment, the Towne-Halsey plan is a great invention, and, like many other great inventions, its value lies in its simplicity.
This plan has already been successfully adopted by a large number of establishments, and has resulted in giving higher wages to many workmen, accompanied by a lower labor cost to the employer, and at the same time materially improving their relations by lessening the feeling of antagonism between the two.
This system is successful because it diminishes soldiering, and this rests entirely upon the fact that since the workman only receives say one-third of the increase in pay that he would get under corresponding conditions on piece work, there is not the same temptation for the employer to cut prices.
After this system has been in operation for a year or two, if no cuts in prices have been made, the tendency of the men to soldier on that portion of the work which is being