The Principles of Industrial Management - John C. Duncan (D. Appleton and Company, 1911) PDF

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Curru'll UiKV.-iMtv L ilu TS 156. D84 Trio principals of induslri.il ii).in,iqt.'mrnl. i':)j-i [){).' :-\H S.l Digitized by Microsoft® THE LIBRARY OF THE NEW YORK STATE SCHOOL OF INDUSTRIAL AND LABOR RELATIONS AT CORNELL UNIVERSITY Digitized by Microsoft® This book was digitized by M...

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Curru'll UiKV.-iMtv

TS

L

ilu

156. D84

Trio principals of induslri.il ii).in,iqt.'mrnl.

i':)j-i

[){).'

:-\H

Digitized

S.l

by Microsoft®

THE LIBRARY OF THE

NEW YORK

STATE SCHOOL OF

INDUSTRIAL

AND LABOR

RELATIONS

AT

CORNELL UNIVERSITY

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THE PRINCIPLES OF INDUSTRIAL MANAGEMENT

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THE

PRINCIPLES

OF INDUSTRIAL

MANAGEMENT BY

JOHN

C.

DUNCAN,

M.S., Ph.D.

ASSISTANT PROFESSOR OF ACCOUNTANCY, treiVERSITV OF ILLINOIS

NEW YORK AND LONDON D.

APPLETON AND COMPANY Digitized

t>i'9^ksoft®

Copyright,

D.

19Z1,

by

APPLETON AND COMPANY

Printed in the United States of

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America

THIS

BOOK IS DEDICATED TO ITS TWO

MOST INTERESTED WELL-WISHERS-

MY PARENTS

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PREFACE The

writer has long felt the need of a scientific treatment

of industrial

of affairs,

Hundreds

management.

in our schools

and

and

of

young men are now

colleges intending to engage in the world

it is

exceedingly important that they gain a

clear conception of the principles underlying the successful

conduct of industrial enterprises.

The material in

this

book

is

gathered from

many sources.

Merely to mention the people to whom the author for data within these covers

would

The writer has endeavored

names.

text for the drawings, plates,

fill

is

indebted

several pages with

to give full credit in the

and diagrams, and, unless

cidentally overlooked, all books

and

articles

received assistance have been cited.

ac-

from which he has

In the

text, however,

there is no mention of his obligations to Judge Elbert H. Gary

and Mr. Richard Trimble, tion, to

Mr.

Wm.

C. Folger, Jr. Jr.,

,

of the United States Steel Corpora-

Laughlin, of Armour and Company, Mr. H.

of the Standard Oil

Company, Mr. E.

Collins,

of the Sauquoit Silk Manufacturing Company, Mr. L.

A. Osborne, Vice-President of the Westinghouse Electric and

Manufacturing Company, and Mr. H. E. Neise, of the American Sugar Refining to thank

them

for

Company;

so he takes this opportunity

their many favors.

to his colleagues in the departments of vii Digitized

by Microsoft®

He

is

further indebted

Economics and Engi-

PREFACE

viii

neering of the University of Illinois, to his former associates at the University of Pennsylvania

Professors E.

and Ohio State University.

H. Waldo and E. L. Bogart, his colleagues

at the University of Illinois, have been very helpful;

former read

all

the

the chapters pertaining to the engineering

matters, in addition to

many of

the others. Professor

Emory

E. Johnson, his former teacher at Pennsylvania, read the entire manuscript,

and expression.

and made many improvements in

style

This paragraph would be incomplete with-

out special mention of his

sister, to

whom

the writer

is

indebted for the work of preparing the manuscript for the printer.

many

In addition to that onerous task she has given

suggestions as to form, expression, and selection of

contents,

which have been of very great

assistance.

In registering his thanks, however, the writer does not

wish to have anyone but himself blamed

for

any

deficiencies

which exist in the volume, as the plan and treatment are his own. It is his

hope that the book will be of service to the stu-

dents of accountancy as well as to those of general business.

The accountant should have knowledge mere methods of making of

entries in

financial statements therefrom.

of

more than the

books and the drafting

He

should be able to

appreciate the kind of information which the needs,

management

and the extent "to which accounting records can gather

the various types of information.

The book

is

written to

give both the accoimtant and the general student of business

a

brief presentation of the underlying principles of the sci-

ence of management.

In teaching the subject the writer has found

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it

exceed-

PREFACE

ix

ingly helpful to the instructor and profitable to the student to have frequent visits to

modern

fully written reports presented

which contribute its failure.

plants

and then have

which discuss those

care-

factors

Such

to the success of the enterprise or tend to trips should be

with some competent guide, and

made with the teacher or be made the basis

may well

of interesting class-room discussion.

John Univeesity of Illinois, Ukbana, December 1, 1910.

Digitized

III.

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C.

Duncan.

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—

CONTENTS PART I.—THE ECONOMIC ENVIRONMENT CHAPTER

I

THE PROBLEMS Introduction

—Factors

—

Affecting Prosperity of Plant Economic Environment Manufacturing and Distributive Policy Organization and Management Problems of Business Management: (1) Location of Plant; (2) Integration and Concentration of Business ; (3) Specialization; (4) Building; (5) Power; (6) Management; (7) Selling

—

—

PAGES

—

CHAPTER

3-4

II

GENERAL THEORY OF INDUSTRIAL LOCATION Survey of Concentration and Localization of Industries Reasons for Localization Census Classification (1) Materials; (2) Market; (3) Water Power; (4) Climate; (5) Labor Supply (6) Free Capital (7) Early StartFour Primary Reasons for Localization (1) Market (2) Raw Materials (3) Labor (4) Power Importance of

—

:

;

;

:

;

;

—

;

Latter Factors

5-23

CHAPTER

III

THEORY OF PLANT LOCATION Factors Other than the Ideal Industrial District Affecting Success of Plant Location, Layout, Equipment Location with Respect to Selling, Buying, Manufacturing Importance of Nearness to Labor Population, Repair Shops, Banking and Credit Considerations Affecting

—

—

—

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xii

PAGES

Needs of Industry (2) Space for Expansion; (3) Low Rent and Taxes; (4) Freedom from Restrictive Ordinances; (5) Adequate Building of Plant :

(1) Special

;

24r-38

Fire-Fighting Facilities

CHAPTER

IV

THE IDEAL SITUATION

—

Country, City, and Suburban Plant Situations Advantages and Disadvantages Location of Plants Suited to Each Kind of Situation Extra Inducements Offered: (1)

— —

Free Land; (2) Free Building; (3) Exemption from Taxation; (4) Stock Subscription; (5) Cash Bonus; (6) Miscellaneous Favors General Rules for Location in

—

Any

39-48

Situation

CHAPTER V BUSINESS CONCENTRATION AND INTEGRATION Classes of Consolidations: (1) Integration of Process from Raw Material to Finished Product (2) Integration and Concentration of Factories ; (3) Integration and Concentration of Distributing Houses (4) Integration by By-Product Utilization ; (5) Integration and Concentration by Control of Patents and Market Ownership Illustrations of Each Form of Consolidation Showing Types of Integration and Concentration Used Determination of the Advisable Type of Consolidation. 49-70 ;

;

—

.

CHAPTER VI BUSINESS SPECIALIZATION

Growth of

—

Reasons (1) Reduction of Preliminary Cost ; (2) Use of Specialized Equipment ; (3) Simplification of Managerial Problems (4) Greater Value of Small Savings Illustrations of Methods of Saving The Interchangeable Part Limitations to SpecializaSpecialization

—

:

;

—

tion

71-80

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CONTENTS

PART

II.—THE

xiii

EQUIPMENT OF THE PLANT CHAPTER

VII

CONTINUOUS INDUSTRIES, SYNTHETICAL PAGES

—

Determination of the Type of Plant Two Kinds of Manufacturing (1) Continuous (2) Assembling Classes of Continuous Industries (1) Synthetical (2) Analytical ^A Continuous Synthetical Industry of Non-By-Product Type Effect upon Plant Structure A Continuous Industry of By-Product Type ^Effect upon Plant Struc:

—

;

:

—

;

—

—

—

81-100

ture

CHAPTER

VIII

CONTINUOUS INDUSTRIES, ANALYTICAL

Cheap Conveying Apparatus by Analytical InTypes of Analytical Industries, Non-ByProduct and By-Product Non-By-Product Industry, Sugar Refining Characteristics of a Sugar-Refining Building Utilization of Gravity Conveying Apparatus in Flour Milling By-Product Analytical Industry, Meat Packing Steps of the Process Ideal Layout for a 101-114 Packing House.

Utilization of dustries

—Two

— —

—

— —

— —

.

CHAPTER

IX

ASSEMBLING INDUSTRIES

Two Groups

of Assembling

Industries:

(1)

Direct Pro-

—

Producing Characteristics of Assembling Industries— Two Questions in Assembling Plant Layout: (1) The Arrangement of Departments; (2) The Building of the Plant— Direct Producing Industry: Shoe Manufacturing— Ideal Layout— Indirect Industry Ship Building—Type of Machinery and Equipment Needed Ideal Layout for a Machine Shop and Foundry—Ideal Layout for a Ship Building Establishducing;

(2) Indirect

:

—

115-134

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CHAPTER X FIRE PRECAUTION, AND

EFFECT ON LAYOUT AND STRUCTURE

ITS

PAGES

The

Plant— Large Changes in Plant Layouts Neces(2) sitated by Fire Precautions (1) In Oil Refineries In Gas Works— Causes of Fire: (1) Common Hazards; (1) Pre(2) Special Hazards— Fire Protective Devices Ideal

:

;

:

ventives of Fire; (a) Slow-Burning and Fire-Proof Structures; (2) Fire Extinguishers: (a) Automatic Sprinklers, (b) Fire Hose, (c) Fire Buckets, (d) Chemical Extinguishers, (e) Hand Buckets ; (3) Fire Alarms (a) The Watchman and the Time-Recorder, (b) Thermostats Outside Fire Protection: (1) Water Curtains; (4) Fire Engines (3) Fire Alarms (2) Fire Hydrants Safety Devices for the Protection of Life: (1) Fire 135-152 Escapes ; (2) Fire Drills

—

;

;

—

CHAPTER XI THE BUILDING AND THE WORKERS Five Essentials to Comfort: (1) Light; (2) Heat; (3) VenLighting tilation (4) Space (5) Conveniences (1) Skylight (2) Windows (3) Saw-Tooth Lights (4) Artificial Light; (5) Elimination of Shadows Heating: (1) Hot Air (2) Hot Water ; (3) Steam (4) Combination of Hot Air and Steam Humidifiers Schemes for Ventilation Importance of Sufiicient*. Space Toilet and

—

;

;

;

;

;

—

—

—

Wash Rooms.

:

;

—

;

—

153-162

.

CHAPTER

XII

THE POWER PROBLEM

—

—

Water Power Advantages of Purchased Power Other Forms of Power Direct Combustion and Indirect Combustion Engines ^The Gas Engine Two Types of Steam Engine (1) Turbine (2) Reciprocating Economies in a Steel Plant: (1) Making Water Suitable for Steam (2) Increasing Boiler Efficiency (3) Increasing Engine Efficiency Comparison of Boiler Compounds

— —

:

;

—

—

;

;

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XV FACES

with Water Softeners— Economizers and Superheaters The Automatic Stoker—The Condenser—Kinds of Power Transmission: (1) Steam; (2) Belt; (3) Rope Drive; (4) Electrical (5) Air Pressure 163-180 ;

PART

AND MANAGEMENT

III.—ORGANIZATION

CHAPTER

XIII

THE THREE TYPES OP ORGANIZATION

—

Duties of the Ideal Manager Three Types of Management (1) Military; (2) Functional; (3) Departmental—Advantages and Disadvantages of Each Type. 181-195 .

.

CHAPTER XIV THE LABOR FORCE Three Kinds of Laborers (1) Men (2) Women (3) Children Male and Female Labor Compared Children as Employees Classes of Labor from Standpoint of Education and Training Apprenticeship Systems Baldwin Locomotive Works Westinghouse Manufacturing Co. 196-213 Advantage in Training Apprentices :

—

—

;

;

—

—

— —

CHAPTER XV THE PAYMENT "OF THE WORKMAN

—

Maximum

Product Systems of Wage PayTime; (2) Piece; (3) Gain Sharing; (4) Premium (5) Halsey and Rowan Modifications (6) Differential Piece Rate; (7) Emerson; (8) Bonus Dan214-232 ger of Cheap Labor

Obtaining the

ment:

(1)

;

;

—

CHAPTER XVI RECORD OF THE WORKERS

—

Necessity of Accurate Records Work of the Labor Bureau (1) Selection of Employees (2) Record of Their Status —Necessity of Considering an Employee's Health, Age, ;

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xvi

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Education, and Experience Sources of Information The Form Letter Qualifications of a Good Employee: (1) Regular Attendance ; (2) Diligence ; (3) Efficiency— Time-Recording Systems (1) Inboard, Outboard Check (2) Drop Box Check (3) Call Number ; (4) Distribution

—

:

;

Check (5) Recording Clock— Proof of Each System's 233-261 Accuracy— Record of Spoiled Work ;

CHAPTER XVII RECORD OF RAW MATERIALS

—

Direct and Indirect Materials Care of Raw Materials (1) Prevention of Waste and Losses on Direct Material ; (2) Prevention of Undue Expenditures for Indirect Material Consideration in Development of the Greatest Economy: (1) Market; (2) Quality; (3) Quantity; (4) Delivery ; (5) Housing ; (6) Waste (7) Losses Departments: (1) Purchasing; (2) Testing; (3) Receiving and Store-room The Perpetual Inventory Arrangement of Stock Prevention of Waste and Loss Requisition 262-280 Scheme—The Budget System :

—

—

;

—

—

—

CHAPTER

—

XVIII

RECORD OF FINISHED AND UNFINISHED GOODS

—

Necessity for Record of Unfinished Goods Two Kinds of Manufacturing: (1) For General Stock; (2) For Specific Contract ^Accurate Records of Partly Finished Goods The Production Order The Summary Cost Sheet Relation to the Production Order 281-293

—

—

—

CHAPTER XIX RECORD OF EQUIPMENT Divisions of Equipment : (1) Tools (2) Patterns (3) Drawings and Plans (4) Power Machinery Arrangement arid Classification of Tools Record of Patterns Record of Drawings Dewey Decimal System Record of Machines Types of Recording Instruments Machine Inventory for Fire Purposes 294-316 ;

;

—

—

—

Index

;

—

—

—

—A

317

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LIST

OF ILLUSTRATIONS FAGB

Map

of the United State...