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On the Track of Efficiency: Scientific Management Comes to Railroad Shops, 1900–1930

Published online by Cambridge University Press:  14 April 2011

Mark Aldrich
Mark Aldrich
Affiliation:
Professor of Economics at Smith College
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Abstract

In 1910, Louis Brandeis claimed that scientific management could save the railroads a million dollars a day and avoid a rate increase. While Brandeis's claims are well known, historians have neglected the influence of scientific management on the railroads. In 1904, Harrington Emerson introduced repair scheduling techniques in the locomotive shops of the Santa Fe. Scheduling revolutionized repair, and–esponding in part to the regulatory pressures Brandeis helped create–by 1925 most major railroads employed it. In the 1920s, the carriers imported a second new management technique–the “progressive” system that focused on material flows, and introduced batch production techniques to car and locomotive repair. Collectively these methods prevented transportation bottlenecks, raised labor productivity, and reduced capital requirements.

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Articles
Information
Business History Review , Volume 84 , Issue 3 , Autumn 2010 , pp. 501 - 526
Copyright
Copyright © The President and Fellows of Harvard College 2010

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References

1 See Interstate Commerce Commission, Evidence Taken by the Interstate Commerce Commission in the Matter of Proposed Advances in Freight Rates by Carriers, August to December, 1910, vol. 4, 61st Cong., 3d sess. (Washington, D.C., 1911), 2620Google Scholar. Emerson's testimony is in the same volume, 2823–37.

2 Martin, Albro, Enterprise Denied: The Origins of the Decline of American Railroads, 1897–1917 (New York, 1971), ch. 7 andGoogle ScholarKanigel, Robert, The One Best Way: Frederick Winslow Taylor and the Enigma of Efficiency (New York, 1997), pt. 6, ch. 1, quotation on 443.Google Scholar“The able railroad managers” is from “Railroads Forbidden to Take More,” Literary Digest 42 (4 Mar. 1911): 389Google Scholar.

3 See the following by Nelson, Daniel: Frederick Winslow Taylor and the Rise of Scientific Management (Madison, Wisc., 1980)Google Scholar ; “Scientific Management, Systematic Management and Labor, 1880–1915,” Business History Review 48 (Winter 1974): 479–500CrossRefGoogle Scholar ; “Scientific Management in Retrospect,” in A Mental Revolution, ed. Nelson, Daniel (Columbus, Oh., 1992), 5–39Google Scholar ; “Scientific Management and the Workplace, 1920–1935,” in Masters and Managers, ed. Jacoby, Sanford (New York, 1991), 74–89Google Scholar. See also Haber, Samuel, Efficiency and Uplift (Chicago, 1964)Google Scholar and Kanigal, One Best Way. Two writers focus on Emerson's work on the Santa Fe: Graves, Carl, “Applying Scientific Management Principles to Railroad Repair Shops–The Santa Fe Experience, 1904–1918,” Business and Economic History 10 (1981): 124–36Google Scholar and Quigel, James, “The Business of Selling Efficiency: Harrington Emerson and the Emerson Efficiency Engineers, 1900–1930,” PhD diss., Pennsylvania State University, 1992. A contemporary discussion isGoogle ScholarThompson, C. Bertrand, “The Literature of Scientific Management,” in Scientific Management, ed. Thompson, C. Bertrand (Cambridge, Mass., 1914), 3–48Google Scholar

4 , Quigel, “The Business of Selling Efficiency,” 126.Google Scholar

5 United States Bureau of the Census, Thirteenth Census of Manufactures, 1909, General Report and Analysis (Washington, D.C., 1913)Google Scholar , Table 1. The 20 percent figure is for 1906 from ICC, Statistics of Railways (Washington, D.C., 1907)Google Scholar.

6 During the 1890s, most issues of the American Engineer and Railroad Journal (hereafter AERJ ) had a section “Among the Shops.” Concern with geographic location and work concentration is from Berg, Walter, American Railway Shop Systems (New York, 1904)Google Scholar and Haig, Maham et al. , Railway Shop Up to Date (Chicago, 1907)Google Scholar. For centralization and specialization, See Jacobs, Henry W., Betterment Briefs (Easton, Penn., 1909)Google Scholar. Litterer, Joseph, “Systematic Management: The Search for Order and Integration,” Business History Review 35 (Winter 1961): 461–76CrossRefGoogle Scholar and his “Systematic Management: Design for Organizational Recoupling in American Manufacturing Firms,” Business History Review 37 (Winter 1963): p369–91Google Scholar. The index of the Proceedings of the American Railway Master Mechanics for 1868–1900 reveals no awareness of the systematic management literature.

7 Stromquist, Shelton, A Generation of Boomers (Urbana, Ill., 1987)Google Scholar and Licht, Walter, Working on the Railroad (Princeton, 1983)Google Scholar. The widespread use of piecework is from “Car Shops, Old and New,” Railway Age 48 (4 Mar. 1910): 467–68.Google Scholar For strikes on the Santa Fe see Graves, “Applying Scientific Management.”

8 Forsyth, William, “The Cost of Locomotive Repairs and the Efficiency of Machine Tools,” Railway Age 29 (14 May 1897): 334–35Google Scholar. In “Electric Shop Equipment,” Railroad Gazette 33 (21 June 1901): 442Google Scholar , the editor complained that “railroad shop equipment as a whole is antiquated and out of date.” “Cars, Steam Railroad,” United States Bureau of the Census, Twelfth Census of Manufacturers, 1900, Part IV, Special Reports on Selected Industries (Washington, D.C., 1902), Tables 7, 10, and 11Google Scholar.

9 On Emerson's personality See , Nelson, Frederick Winslow Taylor, which contains the “more interested” quotation on page 130Google Scholar. “Over-equipped” is from “Some of Harrington Emerson's Experiences,” 22 Dec. 1930, file 11, box 3, Emerson Papers, Paterno Library, Pennsylvania State University (hereafter EP, PSU). “Create an organization” is from John W. Kendrick to A. Lovell, 28 Oct. 1904, file 6, box 15, EP, PSU. Emerson emphasized staff work in his Efficiency as a Basis for Operation and Wages (New York, 1909), esp. ch. 4Google Scholar.

10 Contemporaries referred to schedule and routing systems, suggesting a focus on both the timing and location of production. In fact, in this context routing usually referred to the path of paperwork, not material or product. As shown below, concern with parts or production flows largely arrived later.

11 Graves, “Applying Scientific Management.” Quigel, “The Business of Selling Efficiency.” Jacobs, Betterment Briefs. Going, Charles B., “Methods of the Santa Fe: Efficiency in the Manufacture of Transportation,” Engineering Magazine 36 (Mar. 1909): 909–30Google Scholar ; 37 (Apr. 1909): 9–36; (May 1909): 225–48; (June 1909): 337–60. Morrison, C. J., “Locomotive Repair Schedules,” AERJ 80 (Sept. 1906): 338–39Google Scholar. “Betterment Work on the Santa Fe,” AERJ 80 (Dec. 1906): 451–76Google Scholar. For fuel economy See Aldrich, Mark, “Energy Conservation on Steam Railroads: Institutions, Markets, Technology, 1889–1943,” Railroad History 177 (Autumn 1997): 7–42Google Scholar.

12 For belting see “Betterment Work on the Santa Fe” and Quigel, “The Business of Selling Efficiency,” ch. 3, which contains “a belt was as much a track” on 152. “No good belts” is from Emerson to Roy Wright, 29 Dec. 1930, file 16, box 3, EP, PSU. Nelson, ed., A Mental Revolution.

13 Early time studies on the Santa Fe are from “Theory of Compensation of Labor,” AERJ 76 (Mar. 1902): 81–82Google Scholar. “Meeting among Foremen, Bonus-Time Keepers and Storekeepers… Raton,” 26 Jan. 1908, file 4, box 15, EP, PSU. Broader functions of the compensation scheme are from John W. Kendrick to Edward P. Ripley, 24 June 1910, file 4, box 15, EP, PSU.

14 Nadworny, Milton, Scientific Management and the Unions, 1900–1931 (Cambridge, Mass., 1955)Google Scholar , ch. 4. Aitken, Hugh, Scientific Management in Action: Taylorism at Watertown Arsenal, 1908–1915 (Cambridge, Mass., 1960)Google Scholar. For strikes on the Santa Fe, See , Graves, “Applying Scientific Management” and Quigel, “The Business of Selling Efficiency,” 319Google Scholar

15 Scheduling of freight car repair is from “Betterment Work in the Car Department,” AERJ 82 (June 1908): 208–9Google Scholar. Emerson's remarks are in Symons, Wilson, The Practical Application of Scientific Management to Railway Operation (Philadelphia, 1912), 87Google Scholar.

16 “Shop Scheduling vs. Old-Fashioned Methods,” Railway Mechanical Engineer (hereafter RME) 94 (May 1920): 289–90Google Scholar. It typically took “from three weeks to two months” for a general overhauling and repairing ( , Jacobs, Betterment Briefs, 108)Google Scholar. On the Wabash in 1912, locomotives requiring heavy repairs spent an average of 115 days in the shop. See Kendrick, John W., Report on the Wabash Railway (Chicago, 1912), 136–40Google Scholar

17 The North Western is from “A Shop Schedule for Locomotive Repairs,” AERJ 78 (Feb. 1904): 58–59Google Scholar. For the B&M See “A Shop Schedule for Locomotive Repairs,” AERJ 79 (May 1905): 159–60Google Scholar.

18 For Emerson's system of cost accounting See Morrison, C. J., “The Surcharge Problem,” AERJ 80 (Oct. 1906): 376–77Google Scholar. For modern discussions See Epstein, Marc, The Effect of Scientific Management on the Development of the Standard Cost System (New York, 1973)Google Scholar , and Oakes, Leslie and Miranti, Paul, “Louis D. Brandeis and Standard Cost Accounting: A Study of the Construction of Historical Agency,” Accounting, Organizations and Society 21 (Aug. 1996): 569–86CrossRefGoogle Scholar.

19 , Graves, “Applying Scientific Management,” 131Google Scholar. Nelson, Daniel, Managers and Workers: Origins of the Twentieth-Century Factory System in the United States, 1880–1920 (Madison, Wisc., 1995), ch. 3Google Scholar.

20 “Mistakes of the Efficiency Men I,” Railway Age 50 (6 Jan. 1911): 29Google Scholar ; “Mistakes of the Efficiency Men II,” (3 Feb. 1911): 230–31; “Mistakes of the Efficiency Men III,” (3 Mar. 1911): 391–92. For earlier applications of Emerson's ideas See “Scientific Management,” Railway Age 50 (6 Jan. 1911): 18–19Google Scholar. “Relation of the Emerson Company to the Baltimore and Ohio Railroad Company,” in Report on Efficiency Work Baltimore and Ohio Railroad, book B, box 15, EP, PSU. “Mechanical Department Records –The Graphical System,” AERJ 79 (Dec. 1905): 451–55Google Scholar.

21 Kendrick, John W.: Report on the Chicago, Rock Island & Pacific Railway (Chicago, 1915)Google Scholar ; Report on the Minneapolis & St. Louis Railway (Chicago, 1915)Google Scholar ; Report on the Missouri, Kansas & Texas Railway (Chicago, 1917)Google Scholar ; Report on the Wabash Railroad (Chicago, 1912)Google Scholar. Evidence on Jacobs and Rice as well as Kendrick is from “Custody of Materials on the Frisco,” in Report on Efficiency Work on the Baltimore and Ohio Railroad Company, book A, box 15. Mudge is from “Some of Harrington Emerson's Experiences,” 22 Dec. 1930, file 11, box 3. Both in EP, PSU.

22 Emerson Engineers worked for the North Western, Chicago Great Western, New York, Ontario & Western, Buffalo & Susquehanna, and Wheeling & Lake Erie. See Quigel, “The Business of Selling Efficiency.” Industrial engineering firms are from “Locomotive Scheduling at the Silvis Shops,” RME 97 (Aug. 1923): 579–80Google Scholar and “A Straight Line Method for Locomotive Shops,” Railway Review 73 (8 Sept. 1923): 339–45.Google ScholarNelson, Daniel, “Industrial Engineering and the Industrial Enterprise,” in Coordination and Information: Historical Perspectives on the Organization of Enterprise, ed. Lamoreaux, Naomi and Raff, Daniel (Chicago, 1995), 35–54Google Scholar.

23 Quotation from Report on Efficiency Work Baltimore and Ohio Railroad, n.p., book B, box 15, EP, PSU.

24 The range of Emerson's work on the B&O is revealed in Report on Efficiency Work Baltimore and Ohio Railroad, books A–D, box 15, EP, PSU. For the Buffalo, Rochester & Pittsburgh see “Progress Report of Shop Improvement Committee, Du Bois, Pa.,” 30 Mar. 1917, file 10, box 16, EP, PSU. For Emerson's interest in personnel work see Quigel, “The Business of Selling Efficiency.”

25 “Hundreds of” is from “Efficient Management,” Railway Age 51 (3 Nov. 1911): 886Google Scholar. “An inspiration” and “it is not hard” are from “Scientific Management,” Railway Age 50 (6 Jan. 1911): 18–19Google Scholar. The visits from the Pennsylvania, Lehigh Valley and Reading are reported in Mason, Alpheus, Brandeis: A Free Man's Life (New York, 1946), 333Google Scholar.

26 “Systematic Management in Railroad Shops,” RME 94 (Nov. 1920): 681Google Scholar. “Efficient Shop Production,” Railway Age 57 (6 Nov. 1914): 835Google Scholar. Vrooman, David, Daniel Willard and Progressive Management on the Baltimore & Ohio Railroad (Columbus, Oh., 1991)Google Scholar. Brandes, Stuart, American Welfare Capitalism, 1880–1940 (Chicago, 1976)Google Scholar , emphasizes conflict between Taylorism and welfare work. Nelson, Daniel and Campbell, Stuart, “Taylorism versus Welfare Work in American Industry: H. L. Gantt and the Bancrofts,” Business History Review 46 (Spring 1972): 1–16CrossRefGoogle Scholar , show that the systems merged after World War I. See also Black, Paul, “Reluctant Paternalism: Employee Relief Activities on the Chicago, Burlington & Quincy Railroad in the Nineteenth Century,” Business and Economic History 7 (1977): 120–34Google Scholar and Aldrich, Mark, “Train Wrecks to Typhoid Fever: The Development of Railroad Medical Organizations, 1850–World War I,” Bulletin of the History of Medicine 75 (Summer 2001): 254–89CrossRefGoogle ScholarPubMed. Person, H. S., “The Development of the Policy of the Taylor Society,” Bulletin of the Taylor Society 17 (Feb. 1932): 41–43Google Scholar.

27 “Readville Locomotive Shop–The New York, New Haven & Hartford Railroad,” AERJ 84 (Apr. 1910): 121–32Google Scholar. New York Central and Lake Shore are from “Shop Scheduling and Routing System,” AERJ 86 (Oct. 1912): 539–40Google Scholar. Gardner, Henry, “Schedules for Locomotive Repairs,” Engineering Magazine 44 (Dec. 1912): 417–21Google Scholar. “Recent Developments on the Frisco,” RME 88 (Nov. 1914): 588–93Google Scholar. For the Rock Island See “Reducing the Cost of Locomotive Repairs,” RME 94 (Aug. 1920): 540–44Google Scholar. “Scheduling and Routing Systems for Locomotive Repairs,” Railway Age 68 (11 June 1920): 1916–20Google Scholar. Fifteen carriers is from “Scheduling and Routing Systems for Locomotive Repair Shops,” Railway Review 66 (12 June 1920): 968–71Google Scholar. The B&O under Emerson attempted time studies and standard costing, as did the Canadian Pacific. The Canadian Pacific is from “Graphic Production Control in Railway Shops,” RME 94 (Apr. 1920): 227–30Google Scholar.

28 Gardner, Henry, “Railroad Locomotive Repair Shop Organization,” Railway Age 59 (15 Oct. 1915): 697–99.Google Scholar

29 Cordeal, Ernest, “Scheduling Work in the Railroad Repair Shop,” Engineering Magazine 44 (Nov. 1912): 197.Google Scholar

30 Nelson, “Scientific Management in Retrospect,” claims that where scientific management consisted exclusively of scheduling and routing, employees “were essentially onlookers,” and “their own activities were unaffected” (p. 12). As the text suggests, I disagree. For a view similar to mine see Litterer, “Systematic Management: Design for Organizational Recoupling.”

31 In Figure 3 the thin solid line on engine repair (for example) indicates standard costs for the first six days of October 1919, and the broken line above it additional costs. The thick line is total costs to date. Thus engine repair costs are above schedule, the powerhouse is right on schedule, and store orders are below.

32 “Practically revolutionized” is from “Shop Efficiency and the Scheduling of Work,” Railway Age 53 (20 Sept. 1912): 498Google Scholar , which also contains the claim that output was increased by a third.

33 The block quote is from “Common Sense Locomotive Repairs,” Railway Age 62 (16 Mar. 1917): 431–32Google Scholar.

34 For locomotive and manpower shortages See “Railway Mechanics to be Brought East,” New York Times, 17 Jan. 1918, 3Google Scholar ; “Freight Movement Slightly Improved,” New York Times, 25 Jan. 1918, 20Google Scholar ; and Hines, Walker, War History of American Railroads (New Haven, 1928)Google Scholar , chs. 1 and 2. “The Breakdown of Our Railway Transportation,” Scientific American Supplement 85 (1 June 1918): 344–45CrossRefGoogle Scholar.

35 Kerr, K. Austin, American Railroad Politics, 1914–1920: Rates, Wages and Efficiency (Pittsburgh, 1968)Google Scholar. Direct measures of shop productivity are unavailable. However, the increase in employment was not matched by a rise in either equipment or tonmiles. In addition, the carriers testified that productivity declined. See Willard, Daniel, “The Present Difficult Transportation Problem,” Railway Age 69 (9 July 1920): 71–73Google Scholar and “Results of the Abolition of Piece Work,” Railway Age 70 (29 Jan. 1921): 297–99.Google Scholar

36 “Railroads' Mechanical Facilities Inadequate,” RME 94 (Jan. 1920): 5–10Google Scholar. The Central is from “Why We Were Forced to Contract Locomotive Repairs,” Railway Review (25 June 1921): 969–73.Google Scholar

37 The USRA committee is from “Unified Shop Record and Management Conditions,” Railway Age 66 (18 Apr. 1919): 104Google Scholar ; “One of the handicaps” is from “Wage Systems and Shop Efficiency,” RME 93 (Oct. 1919): 567Google Scholar ; “Establish real schedules” is from “The Piece Work Question,” RME 93 (May 1919): 229Google Scholar ; “Practically all” is from “A Century of Progress in Car and Locomotive Maintenance,” RME 106 (Oct. 1932): 424Google Scholar.

38 Davis, Colin, Power at Odds: The 1922 National Railroad Shop Men's Strike (Urbana, Ill., 1997)Google Scholar. See also Nadworny, Scientific Management and the Unions; Wood, Louis, Union-Management Cooperation on the Railroads (New Haven, 1931)Google Scholar ; and Vrooman, Daniel Willard.

39 “Shopping Union Pacific Locomotives,” RME 105 (Aug. 1931): 408–9Google Scholar. “Maintaining Rail Motor Cars on the New Haven,” RME 104 (Jan. 1930): 28–35Google Scholar. “Gas Electric Rail Car Maintenance on the Reading,” RME 104 (Aug. 1930): 454–56Google Scholar. The MKT is from “Standard Practice in Locomotive Maintenance,” RME 104 (Aug. 1930): 459Google Scholar. That periodic maintenance was common is from “How Changing Conditions Affect Shop Equipment,” RME 103 (June 1929): 289–91Google Scholar.

40 “Results of Scheduling at Milwaukee Coach Shops,” RME 96 (Feb. 1922): 82–83.Google Scholar

41 For evidence on the spread of outside contracting See “Contracts for Car Repairs,” RME 68 (Oct. 1922): 665Google Scholar.

42 “Is the Average Railroad Shop as Efficient as the Average Industrial Plant?” Railway Review 71 (11 Nov. 1922): 674–75Google Scholar. “What's Wrong with the Railroad Shops,” American Machinist 57 (2 Nov. 1922): 677–80Google Scholar ; (16 Nov. 1922): 755–57; (7 Dec. 1922): 879–81; (21 Dec. 1922): 955–57; and 58 (4 Jan. 1923): 1–3.

43 “J. J. Tatum,” in Who's Who in Railroading, 1930 Edition (New York, 1930)Google Scholar. Tatum's patent was number 1,560,878. Tatum, J. J., “Freight Car Classified Repair Shop and Shop Tracks, Unit Organization…” Jan. 1, 1922Google Scholar , in Shop Improvement Programs file, box 103, Otto Beyer Papers, Library of Congress. “The Spot System of Repairing Freight Cars,” RME 102 (July 1928): 396–99Google Scholar. Lord, Chester, “Three a Day,” American Machinist 73 (24 July 1930): 149–54Google Scholar ; (31 July 1930): 199–202; and (7 Aug. 1930): 231–35. On labor's response to the spot system see Vrooman, Daniel Willard, ch. 3. See also “If Interested in Railway Shop Efficiency and Output–ead This,” Railway Review 70 (30 Dec. 1922): 927–34Google Scholar.

44 The quotation is from “If Interested,” 932. As noted the terms “spot” and “unit” and “progressive” system were used interchangeably; it was also termed the “straight line” system.

45 “Conclusions and Recommendations,” RME 101 (July 1927): 432Google Scholar. For the New Haven See “Unit System of Repairing Freight Cars,” RME 97 (Aug. 1923): 56–72Google Scholar. The bonus system on the New Haven is from G. A. Moriarty to Gentlemen, 5 June 1930, file 48, box 1, Emerson Papers, Kheel Center Archives, Cornell University. The B&O is from “The Spot System of Repairing Freight Cars,” RME 102 (July 1928): 396–99Google Scholar. “New Car Repair Facilities for the D. & R.G.W.,” RME 98 (Sept. 1924): 540–46Google Scholar. “Burlington Rebuilds Eight Box Cars a Day at Aurora,” RME 99 (May 1925): 284–87Google Scholar. “Pennsylvania Rebuilds Steel Freight Cars at Enola,” RME 100 (Feb. 1926): 97–102Google Scholar. The Missouri Pacific is from “Progressive Car Repairs at Little Rock,” RME 100 (July 1926): 439–40Google Scholar. For the Bessemer & Lake Erie See “Repairing Freight Cars by the Progressive System,” RME 100 (Mar. 1926): 167–70Google Scholar. “Practically all” is from “How Changing Conditions Affect Shop Equipment,” RME 103 (June 1929): 291Google Scholar.

46 Daito, Eisuke, “Railways and Scientific Management in Japan, 1907–1930,” Business History 31 (Jan. 1989): 1–28CrossRefGoogle Scholar. See also Tsutsui, William, Management Ideology and Scientific Management in Twentieth Century Japan (Princeton, 1998)Google Scholar.

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48 For the North Western See “Passenger Shop Work Organized,” RME 102 (Mar. 1928): 145–50Google Scholar. For the Valley, Lehigh see “Assignment of Locomotives for Engine House Repairs,” RME 99 (June 1925): 325–30Google Scholar and “Lehigh Valley Has Well Organized System Shops,” RME 100 (Dec. 1926): 759–64Google Scholar.

49 Application of the progressive system to locomotives along with the savings in investment is from “A Straight Line Method for Locomotive Shops.” “Interest Well Directed,” Railway Age 78 (20 June 1925): 1503, claims that the new methods influenced repair shop designGoogle Scholar.

50 Nelson, “Scientific Management and the Workplace, 1920–1935,” employs incentive wage plans as a measure of the extent of scientific management during that period, although he notes that such an approach has drawbacks. As seen, such an index fails to capture the extent of scientific management on the railroads.