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Works committees and Joint industrial councils. A report

Albert Benedict Wolfe · 1919 · Scanned text · Free in the US

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About this book

Author
Albert Benedict Wolfe
Language
English
Published
1919
Length
118,215 words · about 8 h 17 min
Sections
29 reader sections
Text
Scanned text, read from page scans by OCR; may contain errors
Rights
Public domain in the United States

 

Contents (29)

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Front matter

(lass H J157, 5

Works Committees

AND

Preface to First Edition

If the war had continued for several years, its continuance would undoubtedly have been attended by serious strain in the relationships between employers and employees. Having. in mind such a. possibility, a branch of the Industrial Relations Division was organized for the purpose of analyzing and making available to American manufacturers both English and American experience in industrial relations under war-time conditions.

Many lines of inquiry were started, but only a few of these inquiries had been concluded at the time of the signing of the armistice. Gne of these which' was concluded is now presented as a report on Works Committees and Joint Industrial Councils. It has seemed best to present the report as prepared by the investigator in charge in order that it may be promptly available. In so far as opinions are expressed in the report, they are the opinions of the investigator, unless otherwise indicated. The United States Shipping Board Emergency Fleet Corporation assumes no responsibility beyond that of presenting the report.

L. C. MARSHALL,

Manager, Industrial Relations Division.

Preface to Second Edition

The report on Works Committees and Joint Industrial Councils, setting forth the English and American experiences in industrial relations under war-time conditions, was published with the hope that it would prove beneficial to those interested in American industry.

The requests for the report have exceeded our expectations many times, with the result that the first edition is practically exhausted, in spite of the fact that it has been out only three months.

It is most gratifying to note that the American business man is giving serious thought to the more advanced methods of dealing with matters of industrial relations and is desirous to learn of the best practices.

We take pleasure, therefore, in publishing the second edition, for which it has seemed wise to make a nominal charge, and trust that it may continue to play its part in helping to develop a better understanding, more sympathetic co-operation and greater harmony in our industrial fabric.

R. W. LEATHERBEE,

Manager, Industrial Relations Division.

United States Shipping Board

Emergency Fleet Corporation

philadelphia, pa.

April I $, IQIQ.

MR. L. C. MARSHALL,

Manager of the Industrial Relations Division,

United States Shipping Board Emergency Fleet Corporation, philadelphia, pa.

Sir: —

I submit herewith a report on Works Committees and Joint Industrial Councils, the materials for which have been gathered during the past four months in the intervals of other duties. Problems involved in the organization and functioning of works committees are dealt with in some detail. The recommendations of the Whitley Committee and the general movement toward joint industrial councils and works corncommittees as agencies of so-called ''co-operative management" are explained. Some attempt is also made to set forth the theory upon which the advocates of co-operative management or industrial representation base their program. Special attention is given to the psychological basis and to the relation between industrial democracy and management responsibility.

Many letters of inquiry have been sent to American manufacturing establishments, but no attempt has been made to secure complete information concerning the extent to which works committees or their equivalent have been introduced into American plants, nor has any intensive study of American industrial representation plans been attempted. Enough first-hand information has been obtained from American companies, however, to indicate that the trend toward industrial representation in shop and works committees is under way and gaining momentum.

Cordial acknowledgment is made of assistance rendered in various ways by Mr. Montague Ferry, Head of the Information Branch; Mr. Arthur Fisher, Mr. Paul Douglas, Mr. F. E. Wolfe, Mr. John J. Casey, Miss Mary B. Wesner, Miss Helen Olson, and Miss Caroline Shaw. Thanks are also due the various companies and individuals who have kindly given permission for the publishing of their experience and views with regard to works committees. The Department of Labor Library, Washington ; the Free Library of Philadelphia, and the Library of the University of Pennsylvania have rendered valuable aid in making available important documents and sources.

Respectfully submitted, INDUSTRIAL RELATIONS DIVISION.

By A. B. Wolfe, December 16, 1918. Head, Investigation Branch.

Contents

PAGE

Introduction 11-14

The Nature of Management 11

Chapter I. The Human Factor in Industry 15-24

1. Three Phases of Industrial Evolution : 15

The Industrial Revolution 15

Scientific Management 16

Recognition of the Human Factor 16

The shortcoming of Scientific Management 16

Importance of the Psychology of the Worker 17

Conciliation and Mediation — Their Shortcomings 18

2. Our Contentment with Industrial Peace 20

3. The Demands of Labor 21

The English Labor Party 21

The Conflict — Attitude of American Labor 22

Its Causes 22

Co-operative Management not a Substitute for a Square Deal

in Wages, etc 23

The Demand for a Voice in Industrial Government 23

Chapter II. Psychology, Democracy, and Efficiency 25-34

1. Psychology in Relation to Industrial Management 25

Behavior 25

Instincts 25

Balked Dispositions 26

Repression of the Instincts of Workmanship and Self-Exprassion 26

2. The Psychology of Industrial Unrest 28

Development of Hostile Community Instincts 28

Lack of Confidence 29

Summary 29

3. The Demand for Industrial Democracy 30

The Content of Democracy 30

Application of the Principles of Democracy to the Industrial

Situation 30

The Content of Industrial Democracy 31

4. Democracy and Responsibility 32

Some political analogies 32

Administrative Responsibility and Policy-Determining Function 32 Administrative Responsiblity Must Remain with the Manager 32 Syndicalist Works Committees, not to Be Confused with Co-operative Management under Private Ownership 34

Chapter III. The Whitley Committee Recommendations 35-63

1. The Whitley Committee 35

Instructions to the Committee 35

Its Membership 35

Causes Leading to Its Appointment 36

The Garton Foundation Memorandum 36

Industrial Council in the Building Trades 36

Convention of Iron and Steel Manufacturers 38

Chapter III. — Continued page

2. Reports of the Whitley Committee 39

The Interim Report 39

Recommendations 39

Works Committees and Joint Standing Industrial Councils 40

Suggested Questions for Industrial Councils 41

The Second Report 42

Classification of Industries on Basis of Degree of

Organization 42

Recommendations for Unorganized and Partially Organized

Industries 43

Memorandum of the Minister of Reconstruction and the Minister of Labor, Rejects the Recommendations of

the Second Report 43

The Supplementary Report on Works Committees 44

Recognition of Organized Labor 44

Works Committees not to Be Used in Opposition to

Organized Labor . . 45

The Report on Conciliation and Arbitration 45

Compulsory Arbitration Opposed 45

Industrial Councils to Co-operate with Existing Machinery

for Conciliation and Arbitration - 46

The Final Report 46

3. The Government and the Whitley Recommendations ........ 47

The Interim Report Submitted to Trade Unions and Employers'

Associations and to the Committee on Industrial Unrest 47

October Letter of the Minister of Labor 49

No Increase of State Control Intended , 49

Rigidity of Organization not Intended 50

Councils not to Usurp the Functions of Trade Unions and

Employers' Associations 50

Compulsory Arbitration not Desired 50

Need of a Representative Body for Government Consultation with the Industry 50

4. Progress of the Formation of Industrial Councils 51

Councils Established, in Process of Formation, and Contemplated 51

Councils for Public Utility Industries 52

Demand for Councils in Government Departments 52

Councils Established by the Admiralty and Post Office Department Criticised 53

5. Criticisms of the Whitley Plan 53

Might Mean Compulsory Arbitration 54

Technical Experts and Office Force not Represented 54

The National Alliance of Employers and Employed 56

Its Principles 56

Its Criticisms of the Whitley Plan 57

Fear of Governmental Interference ... 57

The Industrial Reconstruction Council 58

The Federation of British Industries 59

Its Purpose 59

Its Fear of Governmental Interference . 59

Its Proposals 60

Trade Councils 60

Councils of Industry 60

A National Industrial Council .......-........*... 60

Its Attitude Towards Works Committees 60

6. The Government's Purpose . . . . 62

To Prevent the Rise of Industrial Disputes 62

To Give the W'orker a Voice in Industrial Government 62

To Devolve Industrial Government into Industry Itself 62

To Develop Responsible Representation for Government

Conferences 62

To Insure Efficiency and Competitive Industrial Capacity .... 62

PAGE

Chapter IV. Works Committees 64-111

1. Nomenclature 64

2. The Origin and Development of Works Committees 64

Organized Labor 64

The Shop Steward 66

Shop Meetings • 66

Piece-rate Committees 67

Pit Committees 67

Importance of Co-operation on Employer's Part 68

The Stimulus of War Conditions 69

Dilution Committees 69

Non-union Collective Bargaining 70

3. Functions 70

Demarcation of Function Between Works Committees and

District Councils 70

Functions Always Consultative 71

Functions Vary with Type of Committee 72

Wages . 73

Piece-rates 73

Examples of Piece-rate Committees 73

Overtime 75

Joint Committee on Overtime 75

Grievances . 76

Procedure in Hearing Grievances 77

Changes in Process, etc 77

War Conditions, Demobilization, etc 77

Absenteeism 78

Committees on 78

Labor Turnover 81

Technical Training 81

Business Education 82

Suggestions 83

Suggestion Committees 84

Production Committees 86

Appointment and Promotion 89

Welfare Committees 90

4. Organization and Procedure 90

A. Problems of Organization 90

Constitutional Questions 90

No General Answer Possible 91

(1) Types of Committees .91

Welfare Committees 91

Industrial Committees 92

Joint vs. Separate Committees 92

Advantages and Disadvantages of Joint Committees 93

Representatives of Firm Should Be of High Rank 93

The Open Door 94

(2) Relation to Organized Labor in the Plant 94

Composition of Committees , 94

Safeguarding the Interests of both Union and Non-Union

Men 95

Tendency Toward Election of Union Men 96

(3) Arrangement of Constituencies 97

Elections in Closed Shop 98

(4) Skilled and Unskilled 98

Foreign-born Laborers 98

Negro Laborers , 100

(5) Representation of Women 100

(6) Tenure of Office of Committee Members 102

Chapter IV. — Continued page

(7) Other Constitutional Questions 102

Secret Ballot 102

Minority Representation 102

Recall 103

Officers ■ 103

Secretary 103

Pay of Secretary 104

Size of Committee 104

B. Procedure 104

(1) Time and Frequency of Meetings 104

(2) Amount of Time the Management Should Spend in Meetings 105

(3) Place of Meeting 106

(4) Procedure in Meetings 106

(5) Agenda 107

(6) Minutes 107

(7) Referendum 107

(8) Relation of Works Committee to Foremen 107

Foremen's Committees 109

General Principles which Should Govern Procedure 110

Chapter V. Works Committees in the United States 112-138 Interest in Co-operative Management 112

American Federation of Labor 112

Executive Committee of Socialist Party , 113

Chamber of Commerce of the United States, Committee on

Industrial Relations 113

Pronouncements from Government Agencies 115

Department of Labor, Information and Education Service

War Industries Committee 115

War Labor Policies Board 115

Shipbuilding Labor Adjustment Board 116

Provisions for Shop Committees in the Earlier Decisions 116

Provisions in Later Decisions 117

National War Labor Board 122

Other Boards and Decisions 122

The Loyal Legion of Loggers and Lumbermen 125

Works Committees in American Firms 128

Size of Plant in Relation to Committees 129

Relation of Works Committees to Trade Unions at Large .... 130

Problems of Works Committees in Non-union Plants 131

Conflict of Opinion as to Success of Non-union Industrial

Representation Schemes 131

Desirability of Building on a Union Basis where Possible 134 The Business Agent — Effect of Works Committees on His

Position and Functions 135

The Results of Works Committees 136

Chapter VI. Conclusion 139-146

Appendix I. — Model Constitution of a Joint Industrial Council,

Drafted by the British Ministry of Labor 147-149

Appendix II. — Rebuilding Trade — An Olive Branch to Labor 150-151

Appendix III. — Agreement Between the Engineering Employers'

Federation and Trade Unions in Great Britain 152-153

Appendix IV. — A Non-union Collective Bargaining Plan 154-157

Appendix V. — Works Committees and other Industrial Representation Plans in Operation in American Establishments, together with Opinions on Works Committees 158-237

Appendix VI. — Lost Time in Munition Factories, a New Way of

Dealing with Offenders 238-241

Appendix VII. — Provisions for Works Committees in the Awards of

the National War Labor Board 242-247

Bibliography 248-254

Introduction

The nature of management — Industrial management involves (1) organization, (2) financing, (3) marketing, all to the end of creating a product or service and selling it for a price. Financing includes the procurement of business' capital (money or credit) for construction of plant and meeting expenses for material, power, and labor which cannot be met out of current income. Marketing includes the buying of material, labor, etc. to the best advantage, and the selling of product or service to the greatest profit. Organization comprises the structure and operation of the labor, the land, the plant, machinery, and materials which constitute a going concern. In a general sense, organization also includes, it is true, both financing and marketing, since a machinery and method for these processes have to be set up and kept in effective running order. But it is convenient to take the term organization in the narrower sense. In this sense it marks what may be called, broadly, the engineering aspect of management. The manager has to fit together material things and human forces into a productive organism, be it mine, farm, factory, or shipyard.

Co-operation between the different factors of industry — Co-operation characterizes all industry. It is a truism to say that the captain of industry would be helpless and useless in the absence of labor — a fact which laborers recognize and utilize on occasion by refusing to co-operate, that is by striking. The laborer is helpless also without the manager — some manager — and he recognizes this by submitting usually in good spirit, sometimes sullenly, to direction and orders.

Antagonistic co-operation — But the co-operation which characterizes industry is not infrequently antagonistic co-operation, marked on the manager's side by distrust of labor, class consciousness, autocracy, and cold calculation; and on the laborer's by constraint, withholding of effort, ill-will, unrest, and hostility. Being in the nature of an engineering function — fitting things together — management, especially in our modern impersonal industrial organization, has had a tendency to neglect the human element, which neglect is about as disastrous as it would be for an engineer to forget to oil the bearings of his machine. With the oil of the co-operative spirit lacking or too thin, the industrial machine produces grinding, rasping, and heat, and has to stop for repairs — the patched-up work of mediation or arbitration.

The part labor plays in antagonistic management — In recognition of the human element in industry, the phrase human engineering has been coined, and in the hope of oiling the bearings and eliminating stoppages the idea of co-operative management is evolving. Labor has long demanded a collective voice in the making of the wage contract and the determination of work conditions. Employers on the other hand have generally stood out against these demands as far as they could. The result is an industrial plant arranged into two hostile and suspicious camps. The effect is essentially that of a divided management warring against itself. While the workers, denied a recognized and constitutional voice in plant organization and conduct of industry, do not seem, on the face of things, to have any part in management, they really do, under present conditions, play an important part in it. indirectly and under the surface. The man who thinks he is "managing his own business without the interference of labor" and who thinks he is getting efficiency out of his plant even if his employees are restless and discontented, is probably laboring under an illusion ; his workmen may be taking every opportunity to "get even" and "put one over on him," by all the semi-unconscious and intangible tricks and practices to which any aggrieved class or person will become habitually addicted; his foremen will not know the joy of wholehearted, cheerful work on the part of their men; his superintendents will find things going at cross purposes in a variety of ways hard to explain and harder to remedy. The "labor agitator" of the bad type will have a fruitful field of operation, and in general, compulsion and sullenness will prevail where confident cheerfulness and steady industry should be the normal day-in and year-out condition.

Industrial representation — Industrial representation, or co-operative management, as some prefer to call it. means the elimination of antagonistic management. It means the recognition that the workers not only have a stake in industry and should have something to say about it. but that the denial of a consultative voice to them is responsible for much, if not for most, of our industrial unrest and inefficiency. Industrial representation means at once specialization and co-operation. It means that matters which concern employees only shall be discussed and decided by employees only, meeting in constitutional assemblies — shop and works committees; matters that concern the employers only they shall decide ; but matters that concern both shall be discussed in joint conference (joint works committee, joint industrial council) and decided upon the basis of open diplomacy. Generally speaking, workmen will have no interest in the financing and marketing ends of management, except in those cases where the financing of the companv and its selling, buying, and price policies have important bearing on wage issues. 1 Co-operative management, therefore, does not contemplate that the workers shall have a voice in financing and marketing. It may mean in certain instances, however, that the company must stand ready freely and frankly to throw its books open to inspection by properly authorized representatives of its own employees. 2

The agencies of industrial representation — -The agencies of co-operative management are (1) within the plant, shop committees and a works committee, 3 (2) in the industry as a whole, district and national joint industrial councils, 4 and special collective bargaining conventions or conferences between employers' associations and trade unions.

The motives to industrial representation — The movement for co-operative management is today one of the livest movements in England and it bids fair to become a lively issue in America, and this on four grounds: (1) Industrial unrest is everywhere threatening— where it has not actually already overturned the established basis of industrial control. (2) Even if unrest does not go to syndicalist or Bolshevistic extremes, it seriously impairs industrial efficiency and makes the task of management infinitely harder than it should be. (3) There is a general feeling that industrial efficiency must be increased (a) in order to rebuild the war-devastated wealth of the world, (b) to meet the intense international economic competition the coming of which, while dreaded, seems to be taken as a matter of course. (4) Everywhere a new ethical spirit is developing, recognizing the worker as a human being and his right to a voice in industrial as well as in political government.

Co-operative management, in short, is an aspect of industrial democracy, and aims at a compatible combination of democracy and efficiency in the organization of industry.

Works committees — With regard specifically to works committees, the thought underlying the proposal of the advocates of industrial representation for their institution in American industrial establishment's, following their actual existence in many English factories and the official encouragement which the English government is directing to their further extension, is that American employers, especially in large establishments, should permit and encourage their employees to elect representative committees whose function it will be to consider not

1 As in the case of the railroad companies vs. the railroad brotherhoods. On November jl, 1918, the photo-engravers of New York City announced a new price list to their customers. This list was made up by the Photo-Engravers Union and accepted by the employers. This is an exceptional and highly interesting case where co-operative management touches financing and price-fixing. The photo-engravers have, with union co-operation, fixed a scale of selling prices that will permit the payment of a living wage. — See the Survev, Nov. 16, 1°1S. pp. 192, 193.

2 This is the understood policy of one well-known American firm which two years ago instituted the works committee system in its plant.

8 See Chapter IV. * See Chapter III.

•-"■ grievances but problems of works organization, production methods, shop rules and regulations, and in short all matters which afreet the welfare and spirit of the workers and the tone of the relations between them and their employers. It is a further thought that the work of these committees, while so far as possible organized and conducted by the w : rkers themselves, should have not only the friendly interest and backing of the employers but their cordial co-operation

ell.

The motive for this proposal is the conviction, in the mines : thoughtful employers and students of the industrial problem, both in America and abroad, that industrial unrest can be allayed only by measures which will appeal, to rational and not too selfish employers and workmen, as embodying the principles of a square deal. Those who sponsor the committee plan are ready to grant freely that, like other expressions and methods of democracy, it may not produce : appearance of speed and accuracy in decision and organization which characterize, superficially at least, more autocratic methods of indi - trial control; but the}' believe that in the long run industrial efficiency must be based upon a square deal, and that what is a square deal can be defined even to the approximate satisfaction of all concerned only :o-operative discussion and deliberation. Back of the movement : : ro-operative management lies the belief that there is a vast fund of

I will, and of productive energy, which has hitherto largely been allowed to g: fcc }-5;e — or even turn sour, to produce industrial unrest and ferment — because the old-time individualistic methods and auto- :::.::: ideals of industrial management have failed to take account of the psychology of the worker as a real human being. The motive to co-operative management, in other --iris, is fcc aid in securing industrial efficiency as well as industrial justice through a rational organization of industry which shall treat men as men and not as machines It is backed up by the belief that a square deal and maximum efficiency are mutually cause and effect, and inseparable.

Chapter I. The Human Factor in Industry

1. Three Phases of Industrial Evolution

The phases of industrial evolution — Since the beginning of the industrial revolution, in the eighteenth century, three phases of industrial development are to be distinguished. The first was constituted by the industrial revolution itself ; the second by the activity of efficiency experts and their attempt to perfect industrial organization through so-called scientific management; and the third, just now developing, by recognition and understanding of the great part which the psychology of the workman plays in industrial peace and efficiency.

The first phase, the industrial revolution — The nineteenth century, "the wonderful century," as Alfred Russell Wallace called it, was devoted to the study of the laws of material nature and to the development of physical equipment. No preceding period in the history of the human race began to equal it in scientific discovery and invention, and it is doubtful if any succeeding period will surpass it in this regard. For the first time in the world's history the human mind was really free to devote its rational capacity to the discovery of nature's methods of action. As this great scientific achievement gradually unfolded it was more and more utilized by practical men in the re-organization and advancement of economic production, a process of change which may be said to constitute the first phase of modern industrial evolution. Steam, electricity, the development of chemistry, and many other applications of scientific advancement, all contributed to the transformation of the industrial process, a transformation brought about on the one hand by the energy and effort of captains and sub-captains of industry, whose whole life-interest was wrapped up in securing that greater efficiency of the physical organization of their plants, which together with low wages, they conceived to be the chief factor in productive efficiency, and hence in profits ; and on the other hand by those men of perhaps less driving energy, but more constructive imagination, whose satisfaction it was to provide the practical inventions without which the physical re-organization of industry would have been impossible. 1 This great task of organizing the purely physical productive forces — the material nature factor — involved, at the beginning of the century, the change from hand to machine processes and from the domestic to the factory system ; at the end of the century it had brought us to the more exact tasks of effective planning

1 See Taussig, Inventors and Money Makers.

of plant and shop, economical routing of material, more minute subdivision of labor and specialization of calling, and to the larger task of co-ordinating our extractive, manufacturing, and transportation systems. All this involved radical changes in the position of labor. Labor became more than ever a cog in a mighty and intricate machine, and like other parts of the machine, had perforce to be in the right place at the right time, very much regardless of the desires or feeling of the laborer, either as an individual or as a class.

The second phase, scientific management — The second phase in the evolution of industrial management developed at about the beginning of the present century when the efficiency expert, or industrial engineer, as he now prefers to be called, put in his appearance. So-called scientific management had its birth in Taylor motion-study schemes and "scientific" wage bonuses, and production managers were led to study the labor factor in their establishments. But they were left, from the whole point of view of scientific management authorities, to regard labor practically in the same light as that in which they regarded their machinery and raw material, namely, as something to be shaped, manipulated, adjusted, put in its proper place, and left to perform its allotted task with automatic regularity and monotony.

The third phase, recognition of the human factor — A third phase, now, we may hope, being entered upon, will be characterized by the development of a type of industrial management which will be keenly and truly cognizant of the part which human nature plays in industrial organization and which will clearly understand that the needs, real or fancied, of the workingman — his instincts, prejudices, emulations, ambitions — are as important in the weaving of the industrial fabric as is the quality of steel which goes into a cutting tool, the effective routing of material, or the most scientifically devised cost-keeping system. In other words, this third phase will be one in which full recognition is given to the human factor, and in which, if labor makes impossible or unreasonable demands, the employer will seek to understand the cause of those demands rather than flatly refuse to consider them or offer a take-it-or-leave-it compromise.

The shortcoming of scientific management — The great shortcoming of the scientific management expert, as well as of the average industrial engineer or production manager, was, and is, his sometimes sublime unconsciousness of the importance of the second great factor, the mental attitude of the worker, or rather, perhaps, his failure to see the worker's attitude as it really is. The efficiency experts have been too much in the habit of regarding the workingman as a purely mechanical means to physical ends. That this conception has been detrimental to the very objects which the experts wish to accomplish is shown by the almost universal hostile attitude of labor, whether organized or unorganized, toward scientific management, even in its milder forms. Scientific management is only pseudo- or semi-scientific in that it fails really to "manage" the human nature involved in production. 1

Importance of the psychology of the worker — However much of a "rough-neck" the workingman may be, however crude his intellectual processes, his mental machinery is nevertheless infinitely more complex and delicate than that of the finest chronometer. We reserve the adjustment of chronometers to men who understand delicate machinery, but too often the adjustment of this complex human factor to the industrial process is left either to the blind power of conflicting and passionate forces or to the tender mercies of experts who have slight perception or knowledge of the real psychological elements with which they have to deal. The average business man or captain of industry prides himself upon being a good judge of human nature. He usually is so, in all those matters which have to do with the financing and marketing phases of his enterprise, which involve his own reputation among other business men and the reputation of his goods among consumers. In the task of surrounding himself with an able and loyal personnel in management and office force, he has to be a keen, quick judge of temperament and capacity. In securing and holding the good will of the purchasing public he has to approach human nature from another side — its wants, its emulations, its vanities, its demand for low prices, its reactions under the varied types of suggestion embodied in advertising. But in his relations to labor, especially in the larger plants where direct contact between the higher management and the rank and file of workers is a physical impossibility, the American business man often fails, from lack either of ability or of time, to inform himself with regard to the real psychology of the worker. The ever-recurring conflicts between labor and capital, with all the incalculable loss they incur for both, not only in money, but in the perpetuation of ill will and hard feeling, are sufficient evidence that the managers of industry have been unable or unwilling to secure a smooth running co-ordination between the mechanical factor and the human factor in production. Their failure to do this is proof that they do not understand the mental make-up of labor, and consequentlv do not. manage effectively its co-ordination with plant machinery and raw material. In their concentration of attention upon the technicalities of physical organization of plant and the psychology of the

1 See John R. Commons, Labor and Administration, 1913: R. F. Hoxie, Scientific Management and Labor, 1915. "In spite of the development of Big Business, human nature has remained the same, with all its cravings and all its tendencies toward sympathy when it has knowledge and toward prejudice when it does not understand. The tact is that the growth of the organization of industry has proceeded faster than the adjustment of the in'errelations of men engaged in industry." — John D. Rockefeller, Tr.. in the At Monthly, Jan., 1916.

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