Creativity and Performance in Industrial Organization

Andrew Crosby, Andrew Crosby

• Publisher: Routledge
• Year: 2013
• ISBN:
  9781136436567
• Edition: 1
• Topic: Medicine
• Subtopic: Health Care Delivery

Tavistock Press was established as a co-operative venture between the Tavistock Institute and Routledge & Kegan Paul (RKP) in the 1950s to produce a series of major contributions across the social sciences.
This volume is part of a 2001 reissue of a selection of those important works which have since gone out of print, or are difficult to locate. Published by Routledge, 112 volumes in total are being brought together under the name The International Behavioural and Social Sciences Library: Classics from the Tavistock Press.
Reproduced here in facsimile, this volume was originally published in 1968 and is available individually. The collection is also available in a number of themed mini-sets of between 5 and 13 volumes, or as a complete collection.

Part I
The nature of industrial problems

One
Introduction

The development of this book's subject wiil be in the context of the manufacturing industries. This group of industries is extensive, both in size and in variety of work done. In highly industrialized countries, the proportion of the work force engaged in manufacturing typically ranges from 20 to 40 per cent. The category 'manufacturing' includes wide differences in work content and patterns, from primary materials production to small-scale fabricating operations. Consequently, we shall be forced to choose specific areas to illustrate our discussion, but there should be much scope for making valid inferences in respect of other work situations both within and outside manufacturing.

Our interest is directed mainly to the level of the individual firm. What is the situation found there? Consider a representative firm. It was originally formed as a private concern engaged in work reflecting the proprietor's particular talents. Success and growth brought 'outsiders' into the firm. The proprietor eventually retired and ownership became public. Control of the firm's activities grew more impersonal. Integration of these activities became less pronounced. They gradually became 'functions', with formal specifications of content and of relationship one with another. Persons were chosen to man these functions, but the functions themselves became the permanent, definitive feature; they remained, while a succession of men brought their different attitudes and actions to bear upon them.

This final picture of the firm touches on an interesting field of study regarding the effect of organizational structure on the employee's performance, but our immediate concern is with the nature of the operational problems encountered in each function. These problems have an infinite variety in content, but we shall attempt to group them according to form.

Current Patterns of Organization

The organization of a typical manufacturing firm is shown in Figure I. It represents the four main functions of a firm; they arise from the concept of producing and selling an article, using as resources money and people. We are not concerned here with the relative significance, in the managerial sense, of these

Figure 1 ORGANIZATION OF A TYPICAL MANUFACTURING FIRM

functions, and no rigid interpretation should be made of the arrangement or levels of the subdivisions in the diagrams in this chapter.

It must be stressed that the forms of organization depicted are essentially composites of the wide variety found in different firms. For example, a firm operating in a very competitive consumer goods market, which requires little technical sophistication in product design, would have a strong marketing function. A capital goods producer would have relatively more highly developed technical units.

Figures 2, 3, and 4 present a detailed breakdown of each function. These charts will serve as a basis for describing the range of tasks and, therefore, the problems involved. To examine this range we shall indicate a few examples of work done under each subdivision in the charts. These examples are listed according to an arbitrary classification system, for reference purposes.

Marketing

A. Sales

1. Field Force

(a) Using market research information to find individual prospective customers.

(b) Composing and delivering the sales presentation to suit each prospect.

(c) Planning the most effective use of time according to the progress of each day's events.

2. Service

(a) Analysing and correcting faults of products in use.

(b) Advising the product-design sections m Engineering and in Market Research of patterns of faults and operating conditions that have been observed.

B. Market Research

I. Market Information

(a) Compiling and analysing past sales data from records.

(b) Selecting relevant data from outside sources (economic surveys, industrial statistics, psychological findings, competitor's activities, etc.) and analysing.

(c) Devising market surveys and conducting them.

2. Product Planning

(a) Using market information, determining the range ot demand for sizes, brands, qualities, specialities, etc.

(b) Studying the firm's capabilities and long-range policies to determine limitations.

(c) Determining the general specifications of the range of products and the relative emphasis to be placed on each from the point of view of balancing sales strategy and technical aspects of production to maximize profit.

Figure 2 ORGANIZATION OF THE MARKETING FUNCTION

3. Product Design

(a) Extracting relevant information from market information reports to develop a design brief for each product from the viewpoint of maximum customer satisfaction.

(b) Working with technical personnel to achieve a satisfactory detailed compromise design suiting the policies developed by Product Planning.

4. Market Testing

(a) Devising and conducting tests of the product, ensuring validity by proper selection of subjects participating, appropriate method of testing, controls, etc.

(b) Analysing test results to form a basis for decisions.

C. Advertising

1. Programme Design and Media

(a) Using market information and market-testing results as guides in devising advertisements of form and content intended to increase sales.

(b) Choosing the most effective media to disseminate advertising material, and determining the quantity and timing of advertising appropriate to each of these media.

2. Sales Promotion

(a) Devising and executing programmes of product display and other point-of-sale advertising in cooperation with the salesman.

(b) Organizing and presenting displays and similar representations at public and trade exhibitions.

3. Public Relations

(a) Gathering information and impressions that reflect the attitudes and opinions of the general public, particularly on issues affecting the firm's activities.

(b) Keeping in touch with the attitudes and opinions of those who have a special relationship with the firm, such as employees, customers, shareholders, suppliers, etc.

(c) Making available advice based on this information to persons in other sections of the firm who deal with areas such as advertising, product design, and personnel.

(d) Maintaining contact with the press, broadcasting, and other opinion-forming agencies in order to represent the firm's interests most effectively as occasions arise.

Personnel

A. Welfare

1. Cafeteria

(a) Planning to provide meals and refreshments to meet varying needs.

(b) Adapting, developing, and applying suitable catering methods.

2. Medical Services

(a) Providing facilities and standing procedures for medical treatment.

(b) Administering general health programmes (X-ray, vaccination, etc.).

3. Safety

(a) Providing a coordinated service of information and publicity to encourage safe working practices.

(b) Advising on the design of equipment and processes to ensure adequate attention to safety.

B. Education and Training

1. New Employees

(a) Training for specific job assignments.

(b) Evaluating early performance on the job.

2. Special Skills

(a) Devising training schemes for skills peculiar to the firm or industry.

(b) Maintaining an appropriate pool of skills in the firm.

3. Managerial Training

(a) Devising programmes of job assignment and training to develop the necessary background.

(b) Evaluating progress through reports, tests, and interviews.

Figure 3 ORGANIZATION OF THE PERSONNEL AND FINANCE FUNCTIONS

4. Liaison with Colleges, etc.

(a) Maintaining information on available external training and relating this to internal needs.

(b) Designing joint training schemes with the cooperation of schools and colleges.

C. Employment

1. Selection

(a) Maintaining forecasts of personnel requirements and developing policies of recruitment.

(b) Exploiting suitable sources of personnel and applying valid selection tests.

2. Placement

(a) Testing further to determine specific abilities, interests, etc.

(b) Evaluating, continuously, employee performance and development.

3. Wages and Salaries

(a) Administrating wage payments and records.

(b) Designing wage structures, seniority systems, etc.

Finance

A. Management Accounting

1. Product Costing

(a) Assessing the material, labour, and overhead content of existing products.

(b) Deriving cost standards for these elements in repetitive production conditions.

2. Financial Accounting

(a) Maintaining records and classifying details of all purchases and sales.

(b) Ensuring that cash is available to meet specified requirements.

3. Budgetary Control

(a) Planning items of expenditure in general and in detail for an estimated level of production and sales.

(b) Comparing actual expenditure with planned figures and analysing variances to aid in control.

B. Administrative Services

1. Legal Counsel

(a) Ensuring that the firm's obligations are satisfied in legal and insurance matters, and in other regulated external relationships.

2. Organization and Methods

(a) Providing a service of investigation, design, and installation of methods for increasing efficiency in all company activities other than the production work that is the province of Work Study.

3. Office Services

(a) Providing appropriate centralized or departmental services for storing, retrieving, and disseminating information.

Production

A. Planning and Control

I. Planning and Scheduling

(a) Calculating time and quantity aspects of work requirements and capabilities.

(b) Issuing a coordinated production plan to guide manufacturing supervision.

2. Progressing

(a) Monitoring the progress of production with reference to the plan, and advising supervision of deviations requiring correction.

B. Work Study or Industrial Engineering

1. Methods

(a) Developing detailed procedures for carrying out new work efficiently.

(b) Critically examining existing work procedures and improving them.

2. Measurement

(a) Assessing work done in terms of its time pattern and duration to provide information for critical examination.

(b) Obtaining records of time associated with work for purposes of product costing and wage payment.

C. Operational Research

(a) Providing insight into basic areas of industrial activity by devising models that may suggest new work procedures.

(b) Providing quantitative and qualitative information by the use of specialized techniques to solve operational difficulties in present work procedures.

D. Factory Management

1. Manufacturing Departments

(a) Interpreting information given to transform raw materials into finished product.

(b) Supervising operatives, machines, and material movement to achieve the planned output in terms of quantity, quality, and time.

2. Stores

(a) Maintaining correct supplies of materials and tools, and making them available to authorized users as required.

(b) Maintaining records that represent accurately the movement of all materials handled.

3. Maintenance

(a) Providing skills and resources, when needed, to repair and restore to working order plant, machinery, and services.

Figure 4 ORGANIZATION OF THE PRODUCTION FUNCTION

(b) Carrying out a programme of preventive maintenance to reduce failure of equipment and services.

E. Inspection

1. Quality Control

(a) Establishing surveillance procedures that will give the required sensitivity in comparing product quality with a chosen standard.

(b) Making this information available in the most effective way to correct quality deviation.

2. Standards and Testing Methods

(a) Considering sales, design, and production aspects to establish the optimum quality standards to be imposed.

(b) Developing testing methods that give the information required and are compatible with production techniques.

F. Purchasing

1. Supply Sources

(a) Obtaining materials and plans of appropriate specification, at the lowest cost and at the time required.

(b) Negotiating supply of non-standard items which require technical coordination between supplier and customer.

G. Engineering

1. Product Design and Development

(a) Formulating a tentative product design on the basis of market information, within the limits of appropriate function and cost.

(b) Carrying out necessary testing and modification cycles to achieve product characteristics that satisfy all criteria imposed.

2. Process Design and Development

(a) Evaluating and modifying existing manufacturing processes for new products.

(b) Designing and developing new processes.

3. Job Estimating

(a) Developing estimated cost information on work for which standard data are not available.

Classification of Industrial Work

Several approaches can be taken in an attempt to group industrial problems. One might be guided by the kinds of element that make up the problems: thus one would distinguish between problems involv...