Engineering
Library
SHOP MANAGEMENT
AND SYSTEMS
SHOP MANAGEMENT
AND SYSTEMS
A TREATISE ON THE ORGANIZATION OF
MACHINE BUILDING PLANTS AND THE
SYSTEMATIC METHODS THAT ARE ESSEN-
TIAL TO EFFICIENT ADMINISTRATION
BY
FRANKLIN D. JONES
AND
EDWARD K. HAMMOND
ASSOCIATE EDITORS OF MACHINERY
FIRST EDITION
SECOND PRINTING
NEW YORK
THE INDUSTRIAL PRESS
LONDON: THE MACHINERY PUBLISHING CO., LTD.
IQ2O
Engineering
Library
COPYRIGHT, 1918,
BY
THE INDUSTRIAL PRESS
NEW YORK
COMPOSITION AND ELECTROTYPING BY F. H. GILSON COMPANY, BOSTON, U. S. A.
PREFACE
THE purpose of this book is to give definite information on
various systems that have been adopted, particularly in ma-
chine-building plants, to insure orderly and effective methods
of procedure in the administration of manufacturing, designing,
and purchasing departments. Practically the entire volume is
filled with specific examples showing the exact details of different
working systems and just how they are applied under various
conditions. The fact that concrete examples are given rather
than general and abstract theories is regarded as a commendable
feature of the book. While the systems described may not be
directly applicable to other industrial organizations without
modification, they form a definite basis upon which to work, and
enable the student of management to see more clearly the
relation between the system and that branch of work to which
it may be applied.
Most of the systems described are used to assist in the control
of manufacturing processes. They include means of recording
what has been done and methods of systematically governing
different departments so that concerted action may be obtained
and work be done efficiently and in accordance with necessary
requirements. The general subjects treated include methods
of ordering materials, accounting for materials in stock, follow-
ing the progress of work during manufacturing processes, in-
suring the prompt delivery of tools or parts to various depart-
ments, controlling the purchase or manufacture of special tools,
caring for and maintaining small tool equipment, insuring ade-
quate inspection of manufactured products, and other subjects
related to efficient industrial organizations. The various forms
and blanks used with different systems for recording useful
data and as a means of governing manufacturing processes are
included to show more clearly the exact methods of procedure.
V
414893
VI PREFACE
This treatise is not only intended for works managers and
shop superintendents, but for everyone who aspires to an execu-
tive position in industrial plants. The fact that the most
modern equipment in machine shops or other manufacturing
establishments cannot be used efficiently without systematic
methods of control, is generally recognized, and it is believed
that students of engineering and manufacturing methods, whether
in the shop, drafting-room, or college, will find helpful informa-
tion in this book.
Many of the articles which have been published in MACHINERY
on the general subject of shop systems have been included in
this volume, and we are especially indebted to Ralph E. Flanders,
Alfred Spangenberg, William B. Wessels, C. W. Thayer, and
A. L. Valentine for valuable contributions descriptive of different
systems that have been employed in connection with shop and
factory administration.
THE AUTHORS.
NEW YORK, January, 1918.
CONTENTS
CHAPTER I
INDUSTRIAL ORGANIZATION AND MANAGEMENT
PAGES
Forms of Industrial Organizations Systems of Manage-
ment Management based on Preliminary Planning
Control of Manufacturing Operations Organization of
Planning Department Work of Functional Foreman
Importance of Establishing Standards 1-17
CHAPTER II
GENERAL SHOP SYSTEMS
Records of Costs and Manufacturing Conditions Re-
quisitions for Material and Systematic Methods of Ordering
Parts System of American Machine and Foundry Co.
Accounting for Jigs and Fixtures Following Progress of
Work in Shop Time Records Stock-keeping System
Methods of Locating Officials in Manufacturing Plants
CHAPTER III
GENERAL TOOL AND SUPPLY SYSTEM FOR
LARGE PLANT
System of Cadillac Motor Car Co. Function of Tool
Service Department General Operation of System
Procedure in Ordering Tools and Supplies Examining
Records to Guard against Shortage Replacement of
Worn-out and Broken Tools Repair of Commercial
Tools Market Prices and Grades of Materials 56-79
viii CONTENTS
CHAPTER IV
ORDERING, MANUFACTURING, DISTRIBUTING, AND
ACCOUNTING SYSTEM FOR SPECIAL TOOLS
PAGES
Procedure when Special Tools are Needed Ordering
Patterns and Castings Assigning Toolmaking Work
Records of Labor Costs Records of Special Tools and of
Repair Parts Sets of Tools for Special Operations
Transfer of Tools between Different Departments 80-109
CHAPTER V
FOLLOWING PROGRESS OF WORK IN MANUFACTURING
DEPARTMENT
Advantages of a Follow-up System Causes of Delay
in Manufacturing Plants Value of Surplus Stock and
Equipment An Effective Follow-up System Racks
and Charts which show Progress of Work in all Depart-
ments i 10-134
CHAPTER VI
INSPECTION SYSTEM FOR MACHINE SHOPS
Organization of an Inspection Department Extent of
Inspection Disposal of Defective Parts Complaints
Relation of Inspection Department to Management and its
Control Duties of Chief Inspector Cooperation be-
tween Inspection and Other Departments 135-145
CHAPTER VII
STORAGE AND MAINTENANCE OF SMALL TOOLS
Location and Plan of Tool Supply Room Classes of
Tools and Supplies kept in Store-rooms General Arrange-
ment of Storage Fixtures Cabinets and Racks for Differ-
ent Classes of Tools Maintenance of Tools Deter-
mining Causes of Tool Breakage Tool Supply Systems
in General Use '. 146-168
CONTENTS IX
CHAPTER VIII
TOOL CHECKING SYSTEMS
PAGES
Single-check System Use of Checks and Tool Tags
System for Keeping All Checks in Tool Supply Room
Double-check Systems Checks to Show how long Tools
have been out Written Receipts for Tools Check-
boards for Tool Supply Rooms 169-177
CHAPTER IX
METHODS OF DELIVERING AND IDENTIFYING
TOOLS
Delivery of Tools in Sets Portable Cabinets for Sets
of Tools Tool Lists Stamped on Jigs and Fixtures
Storing Special Tools Separately Sets of Tools kept by
Workmen Identification of Special Tools Tool Symbols 1 78-191
CHAPTER X
TOOL SUPPLY SYSTEM UNDER SCIENTIFIC
MANAGEMENT
Classification of Tools and their Arrangement according
to Classification Delivery of Tools to Manufacturing
Departments Return of Tools to Place of Storage
Systematic Method of Maintaining Tools in Good Condition 192-204
CHAPTER XI
TOOL ENGINEERING DEPARTMENT
Qualifications of Tool Engineer Procedure in Design-
ing Special Tools and Order of Tool Engineer's Work
Organization of Tool Designing Department Import-
ance of Checking Drawings Filing Systems for Draw-
ings List of Machine Tool Equipment 205-217
X CONTENTS
CHAPTER XII
ORGANIZATION OF AN ASSEMBLING DEPARTMENT
PAGES
Importance of Analyzing Conditions Stock Tracing
System Inspection and its Relation to Assembling
Arrangement and Equipment of Assembling Room
Methods of Routing the Work Delivery of Parts for
Assembling 218-237
CHAPTER XIII
SYSTEM OF PURCHASING DEPARTMENT
Requisition or Supply Order Purchasing Agent's
Authority Records of Purchasing Department Plac-
ing and Tracing Orders Receiving System Ordering
Small Tools and Supplies Balancing Production with
Sales Efficient Buying Methods . . . 238-257
CHAPTER XIV
WAGE SYSTEMS
Day Wage System Piece Work System Premium
System Rowan Modification of Premium Plan Bonus
System Differential Wage System Emerson Wage
System Contract System Profit-sharing Methods .... 258-271
CHAPTER XV
DRAFTING-ROOM SYSTEMS
Standard Drawing Sizes Numbering Parts and Draw-
ings Dimensioning and Checking Drawings Changes
in Design Index System Drafting-room System of
American Locomotive Co 272-298
SHOP MANAGEMENT AND
SYSTEMS
CHAPTER I
INDUSTRIAL ORGANIZATION AND MANAGEMENT
WHILE management and organization are essential in all in-
dustrial enterprises, there is a great difference in the way organ-
izations are formed and directed. These variations in practice
may be due to differences of opinion on the part of managers or
to variations in the conditions under which work is done. The
organization, in any case, is composed of individuals having dif-
ferent duties to perform, and a certain number of executives with
varying degrees of authority. The exact duties of each member
of an organization may be clearly defined or there may be con-
siderable latitude in this respect or independence of action. It is
quite evident that the form of the organization is not related to
the individuals composing it, although the efficiency of an organ-
ization or its effectiveness as a means of production may be
decidedly affected by the intelligence, experience, and skill of each
member in the organization.
The primary object of every manufacturing organization is to
produce work of the required standard of quality, on a more
efficient basis than would be possible without an organization.
The formation of an organization, then, involves selecting the
individuals composing it, denning their relations to one another,
and determining their responsibilities and duties. The type or
exact form of an organization must, of course, be governed in
part by such factors as the size of the plant, the number of varia-
tions in manufacturing processes, the nature of the work, the
number of trained specialists that may be necessary for control-
ling manufacturing operations, the extent to which cooperation
2 SHOP MANAGEMENT
is necessary between different departments, and the type of
management which is directing the organization. Because of
these and other factors, it is not practicable to lay down fixed
rules which can be used as a guide in planning the exact details
of an organization, although there are general principles under-
lying different systems of management that are capable of wide
application.
Line Organization. The simplest class or form of organiza-
tion and the one most extensively applied, at the present time,
especially in the smaller shops or factories, is known as the
" line " or " military " organization. The relation of different
members of such an organization is shown graphically at A in
Fig. i. This diagram, however, is not supposed to represent a
complete organization, but merely the principle upon which it is
based, since the exact arrangement and extent depends upon
variable conditions. The characteristic feature of a line organi-
zation is that the authority is direct from the highest executive
through the different lower executives down to the workmen.
Each employe is responsible to the foreman of his particular
department, and each department foreman is directly under a
higher authority, such as the general superintendent or works
manager. The foreman of one department has no authority
over a foreman of another department and the methods of han-
dling work in any one department and by any one workman may
be governed partly by the department foreman or some other
executive and partly by the workman himself. For instance, in
a machine shop, the exact method of performing a certain opera-
tion may be decided beforehand by the general superintendent
or chief draftsman, and possibly a special jig or other tool is made
to insure doing the work exactly as planned. Ordinarily, how-
ever, under line organization, the workman has considerable
latitude, and he may decide as to the method of procedure, more
or less assistance being given in some cases by the department
foreman.
With this form of organization, the responsibilities are clearly
denned and each executive knows what he is supposed to do and
just where his authority begins and ends. The line organization
INDUSTRIAL ORGANIZATION
may be very strong and effective, if each executive is competent
to govern properly every branch of work under his supervision.
If the organization is large and the work of manufacturing in each
department requires a special knowledge of different subjects, it
may be impossible to secure foremen competent to operate the
SKILLED AND UNSKILLED WORKMEN
A
SKILLED AND UNSKILLED WORKMEN
B
Machinery
Fig. i. Diagram illustrating Line and Staff Organizations
various departments on an efficient basis. Because of this de-
fect, organizations which conform strictly to the plan illustrated
at A in Fig. i have been largely replaced by modified forms,
especially where the plant is large and complex conditions exist.
The effect of these modifications is to relieve certain executives
4 SHOP MANAGEMENT
of duties which are of a decidedly different character and which
they may not be entirely competent to assume. While the term
" military organization " has been applied to the form previously
described, this name has become a misnomer, because modern
military organizations have also been modified to some extent,
the same as those which are commercial or industrial.
Staff Organization. A form of organization which differs
entirely from the one described in the foregoing is known as the
" staff " or " functional " organization. The object of this kind
of organization is to focus expert knowledge on every department
of a shop or factory, by employing specialists whose authority,
instead of being confined to any department, extends wherever
the knowledge of each specialist can be utilized effectively. The
principle is illustrated by diagram B, Fig. i. The general super-
intendent or works manager, instead of attempting to directly
control the foremen of different departments, has under him two
or more specialists having equal authority. The diagram shows,
by way of illustration, a chief engineer, a production engineer,
and a chemist. The chief engineer may control all matters per-
taining to designing, testing, etc.; the production engineer is re-
sponsible for the actual work of manufacturing; and there may be
some other executive, such, for example, as a chemist, to see that
materials (either being purchased or in the process of manu-
facture) such as metals, lubricating oils, etc., are up to the re-
quired chemical standards. Between these executives and the
workmen there are special or functional foremen to instruct the
workmen in whatever branch of work is under their supervision.
The advantages of the staff organization, when composed of
competent men, is that each workman is guided and assisted by
several experts. The chief disadvantages cited against the staff
organization are the overlapping of authority because of so many
executives having equal authority, and the lack of discipline.
These objections, however, have been overcome where the staff
organizations have been so thoroughly developed that each man's
duties and responsibilities are clearly defined, by preliminary
planning based on scientific investigation of all the factors affect-
ing the problems of management.
INDUSTRIAL ORGANIZATION 5
In many manufacturing plants, the line and staff principles of
organization are combined, although frequently this is not the
result of a deliberate plan but is simply a natural development
brought about by conditions which obviously require a modified
form of organization. For example, if an attempt were made to
adopt a strict line organization, it would soon be apparent in
most cases that there was not sufficient cooperation and that
more efficient results could be obtained by employing to some
extent, at least, the good features of the staff or functional organ-
ization.
Advisory Committees. Another variation which is regarded
very favorably by some authorities on organization is known as
the " committee " system. This plan, which is intended for
comparatively large concerns, is based on the old adage that
" two heads are better than one." Committees are formed to
advise regarding policies of management, changes in manufac-
turing practice, etc. For instance, there may be a manufacturing
committee which would consider general policies, a tool com-
mittee to discuss the design of new tools or the improvements of
existing tools, a safety and welfare committee, and so on. These
committees would be composed in each case of men best fitted by
training and experience to suggest changes or improvements.
For example, a tool committee might include a tool designer, the
tool-room foreman, the shop superintendent or department fore-
man, and anyone else whose experience or special knowledge
might prove helpful. The committee is simply intended to
advise or suggest, and it has not been advocated as a substitute
for a strong executive.
General Types of Management. Management may, in a
general way, be classified either as (i) unsystematic, (2) system-
atic, or (3) scientific. It does not follow, however, that the
entire management of any one plant belongs entirely to one of
the classes mentioned. The unsystematized form of manage-
ment is based upon personal experience, judgment, and initiative,
and its success depends largely upon the ability of both executives
and employes. The tendency with unsystematic management
is to follow along conventional lines, and methods of doing work
6 SHOP MANAGEMENT
are chosen either by executives or workmen and are selected be-
cause past experience has demonstrated that a certain method
of procedure will accomplish the desired result. Whether any
particular method could be improved is not investigated in a
systematic manner, and the results of experience are not recorded
(except probably in a haphazard way), in order to serve as a
guide for future reference.
Accounting under the unsystematized form of management
generally includes an annual or semi-annual statement as to the
assets, liabilities, profits, and losses. If the statements indicate
an unsatisfactory financial condition, the cause has probably
existed for some tune before it is discovered and an attempt is
made to eliminate it. The purchase of materials may not have
been done in accordance with specifications that are essential,
nor the amount of stock regulated strictly with reference to the
demands of the manufacturing departments.
Systematized Management. Systematized management is
based on classified information and records of performance. The
object, in part, is to improve present practice, whenever this can
be done by the substitution of one method for another which is
inferior, according to the record of a similar operation which has
been performed in a different manner. The accounting is more
complete and data are available showing cost of materials and
labor, relative annual cost for a given department or product,
proportion of overhead charges, etc. In brief, systematized
management aims to secure correct costs in order to establish
selling prices and determine where costs may be reduced. The
purchase of materials and their storage is also done systemati-
cally, and a perpetual inventory is kept showing the amount of
material in stock at any time. Written orders are issued for
manufacturing operations and records kept of the time expended,
in order to determine labor costs. The workmen in a machine
shop under systematized management are not necessarily directed
as to the precise manner of performing work. For instance,
general manufacturing processes on a machine like a lathe or a
planer may be done in different ways by different workmen. The
same method of procedure, however, may be followed in pro-
INDUSTRIAL ORGANIZATION 7
during duplicate parts, especially if special jigs, fixtures, or other
tools are used, but, in general, the manufacturing practice is
based largely upon the personal opinions and experiences of the
foremen and workmen. This general method of manufacture is
entirely eliminated under the plan of management to be described.
Scientific Management. What is generally known as
" scientific management," or the Taylor system (because of the
pioneer work of Frederick W. Taylor), may be defined as a
system of management which aims to govern every department
of an organization in accordance with demonstrated facts and
the results of scientific investigation, instead of relying upon rule-
of- thumb methods and individual opinions. Methods of per-
forming work are carefully analyzed in order to eliminate useless
efforts and make every stroke count. When a superior method
of performing work has been found, it is embodied in the organi-
zation just as a new and more efficient machine would be installed
in the shop. While scientific management substitutes definite
and accurate information, as far as possible, for individual judg-
ment and experience, judgment must, of necessity, have a place
in any system of administration, either because it may not always
be possible or feasible to obtain accurate information or because
to obtain it would cost more than it is worth. According to
H. L. Gantt, a system of management to deserve the term " scien-
tific " should aim to meet the following four conditions:
1. It should provide means for utilizing all of the available
knowledge concerning the work in hand.
2. It should provide means for seeing that the knowledge fur-
nished is properly utilized.
3. It should award liberal compensation for those who do use
it properly.
4. It should provide liberal means for acquiring new knowledge
by scientific investigations with adequate rewards for success.
Time Study. One of the important and fundamental
branches of scientific management has to do with time study.
One object of applying time study to a method of performing
work is to determine what movements are useless, or what is
wrong with an existing method and how the same work can be
8 SHOP MANAGEMENT
done with an expenditure of less physical effort and time. This
is the first step in the application of a scientific system of mana'ge-
ment, and is commonly referred to as " motion study." Time
study is also an analysis of every element or phase of a process.
It is not merely determining the length of time for performing a
given operation, but a study of every detail which enters into
that operation and the recording for future reference of the exact
time required for each motion or element connected with the
work. One of the difficulties connected with the application of
scientific management is in properly classifying, tabulating, and
applying such data, especially where the work is greatly diversi-
fied. After time studies have been made, it is necessary to cor-
rect, as far as possible, faults in materials, methods, and mechani-
cal appliances, and this part of the work requires judgment and
ingenuity. Standards must also be established and systematic
methods be adopted for maintaining those standards.
Preliminary Planning. A basic principle of scientific man-
agement is to first determine a good method of performing work
and then to follow it. In order to apply this simple principle,
preliminary planning is necessary and the time study previously
referred to constitutes a very important part of this work.
Every machine-building plant equipped with a drafting-room
has one kind of planning department, since indicating on a draw-
ing what is to be done is nothing but preliminary planning. The ,
planning department under scientific management represents a
further development in that it decides how and when work is to
be performed.
With any system of management, some one must determine
what procedure is to be followed, and under an ordinary system,
as applied to machine shops, the judgment and experience of the
foreman or workmen is largely relied upon, excepting where the
work is merely that of operating a special tool or machine which
entirely controls the manufacturing process. The object of a
planning department is to avoid guesswork and to control an
entire manufacturing plant in accordance with definite plans and
schedules. The classified data in the planning department cover-
ing every phase of work make preliminary planning practicable
INDUSTRIAL ORGANIZATION 9
and economical; moreover, by planning in advance, any special
tools or materials that may be required can be obtained before-
hand, thus avoiding delay. Planning at the time work is done
means, in many cases, that a machine must remain idle while the
method of procedure is being considered. The planning depart-
ment of a machine shop operated in accordance with the prin-
ciples of scientific management not only specifies the time in