The Impact of Taylorism and Fordism on Contemporary Management Approaches - Case Study Example

WORK AND EMPLOYMENT: IMPACT OF TAYLORISM AND FORDISM ON MANAGEMENT by Date Introduction Management is a very complex field and has evolved over a long period of time. Globalisation has affected every part of our lives and not even management has been spared thus forcing new approaches to management to be developed in line with global demands. The oldest school of thought was the scientific management by Frederick Winslow Taylor. His main objective was to improve economic efficiency through application of scientific principles to labour process and establish one best way to do things. Its main impact was efficiency along with deskilling and dehumanisation of workers. Fordism was another school named after Henry Ford after spending much devising ways of improving productivity of automobile companies and most especially Ford Motor Company. However, the term was popularised by Antonio Gramsci in 1930s. Ford applied most of Taylor’s ideas but concentrated on standardised mass production and mass consumption. What followed was the Post-fordism which is prevalent today characterised by use of technology, shift from manufacturing to service economy and flexibility. This essay will critically discuss the impact of Taylorism and Fordism on contemporary management approaches and practices. I will argue that both management processes led to deskilling and offshoring leading to increased labour turnover, low wages, job insecurity, deunionisation, and many other changes in work organisation. Taylorism According to Taylor (2007: 11) the main objective of Taylor when developing scientific management was to “maximise prosperity of the employer coupled with maximum prosperity for each of the employees.” In this regard, Taylor assumed that the interests of the management were similar to those of the workmen as each had something to gain from the employment relationship. The employer was to achieve low labour cost for manufactures while the employee would get high wages in return. As such, one principles of his management was equal division of work and responsibility between management and workmen (Jones 1997). Taylor was also sceptical of the repetitive tasks the workers (craftsmen) were carrying out at a very slow pace without motivation. He figured out that the pace of work could be increased by developing work processes hence the first task was to analyse work scientifically and develop principles to guide performance of that work and also obtain best initiative hence increased returns. This was based on the idea that these skills handed down from generation to generation could be combined and perfected. He claimed that the ingenuity and experience of each generation, each decade, have handed over better methods to the next and this he called traditional knowledge (Taylor 2007: 31). If this traditional knowledge is combined, then workmen would have mass knowledge which no manager can match. The work of manager was thus cut out as that of inducing each worker to use his best endeavours, hardest work and initiative to yield largest possible return. The second principle of management was thus to scientifically select and train and develop the workers and also cooperate with them according to principles so developed. The salient features of Taylorism included many rest breaks to curb monotony of work and reduce stress and fatigue as these workers did repetitive tasks. It entailed Use of work ethic, elimination of waste and standardisation of best practices. It was also characterised by division of labour and high level of managerial control as Taylor believed that workers were not capable of managing themselves. Knowledge transfer was a key component of this method if efficiency was to be achieved. In this case, workers were supposed to transfer knowledge amongst themselves and also to the tools thus improvement. However, according to Smith (2001) Taylor failed to add continuous to the improvement process so as to have continuous improvement as is evident today. To have improved economic efficiency and increased labour productivity, workers were encouraged to innovate and in return the management to appreciate the innovations by establishing formal channels of worker input and if innovation is productive, then it is incorporated into existing rules as a standard procedure (Crowley et al 2010: 426). Taylorism also entailed selecting right people for right jobs and eliminating those who are slackers or unproductive. It was introduced during the era of mechanisation and automation hence laid the ground for automation of industrial processes and also offshoring. Fordism Fordism was established by Henry Ford of the Ford Motor Company. His main aim was to make the industry productive although some scholars would attribute it to development of Taylorism as most of scientific management principles were incorporated in Fordism. Taylor developed the idea of division of labour but Ford perfected it by breaking down the production process into small segments with each segment being handled by single person in an assembly line (Beynon & Nichols 2006). Ford also eliminated the use of humans and replaced them with special-purpose machines thus perfecting the automation process started by Taylor. These machines produced standardised mass products for customers for mass consumption. By operating on regulation principle, Ford wanted to ensure workers’ standard of living are raised in proportion to their productivity hence his era was that of high-wages as also emphasised by Taylor. This high wage was to enable these workers to consume the mass products that were being produced. The system also offered job security for workers even though most had no skills or semi-skilled. Implications of Taylorism and Fordism Taylorism and Fordism had great implications for contemporary management approaches and practices. This is evident in the Post-Fordism era characterised by flexible labour arrangements and lean techniques. Coupled with globalisation, improved communication and technology management processes have changed greatly. One of the major outcomes of Taylorism and Fordism was deskilling. Taylor while developing scientific management principles did not intend to replace humans with machines but bearing in mind that it was an era of industrialisation and automation, industrialists were bound to use these principles to improve their work processes hence replacement of manual labour with machines (Taylor 2007). These machines did not require highly skilled labour hence the use of semi-skilled labour and eventually eliminating them. Furthermore, Taylor advocated for elimination of those who could not keep up the pace of work. He advocated for first class workers with mental calibre, character and fit and removal of second-class. According to Crowley et al (2010: 424-425) education, training and experience were less important for success than determination, endurance, tenacity and constructive imagination. Management approach thus changed from recruiting those with training and experience to more emphasis on selecting “right” types of individuals who do not need to be motivated as they are self-motivated and self-disciplined. The hiring process also includes elaborate procedures such as orientation, psychological profiling, and multiple interviews with much emphasis on attitude than skills. Machines do not require very high skills to handle hence skills mattered less. For Ford, employees were regarded as interchangeable parts hence not concerned about their skill development. Deskilling is the reason why most cotemporary organisations now use young inexperienced workers who are lowly paid. Another implication for management practices is the employment of young graduates and college students especially in retailing and fast-food industries. These workers are not experienced and no skills as most of them treat this job as a stop to more advanced career or to get college fees. According to Alan, Bamber and Timo (2006: 402-420) three-quarter of full time undergraduates are below the age of 25. Most of them work part-time as they do not have time to work full time and they also work on casual basis and paid junior wages especially in Australia. In hospitality industry they employed in the front-line since they are better educated and can speak English well. These young workers face many challenges in their work but since they are temporary, they are not unionised hence no one to represent their voice (Bryson et al 2005). They themselves do have a voice for fear of losing their jobs; they do not have job security. Together with employment of young people thus comes the implication for employment relations. A study conducted by Allan, Bamber and Timo to find out student experiences of McJobs in Australia revealed that most of them are dissatisfied with industrial relations and work organisation aspects of the job but satisfied with human resource management and social relations aspects of the job (Allan et al 2006). These youngsters work on low-road, low-skill, low paying, and insecure jobs and sometimes they work for long hours and denied overtime pay since they are not protected by a union. Sometimes they do work beyond their job descriptions as there is no limit to their work. Bryson et al (2005) asserts that these youngsters would like to be unionised but do not have an avenue for doing so due to limiting management practices. The fast-food managers use low-cost regimes to limit unionisation thus harsh treatment of employees. They are made to work for long even through breaks without compensation. Due to employment of young college students and graduates, employee turnover is very high in post-Fordist companies or neo-Taylorism as some scholars would prefer to call it. This is because young workers opt to adopt exit strategies rather than use their voice for fear of losing job. A study by Kuruvilla and Ranganathan (2010) on India’s Business Process Outsourcing (BPO) industry found that since these firms have a very high turnover (30%-40% P.A), the management are devising different strategies to deal with this problem. BPOs in India have a market share of 48-50 % and grow at an annual average rate of more than 5% but due turnover and their rapid growth, there is scarcity of labour in this sector hence the need to retain employees by all means. The causes of high turnover included dissatisfaction with supervisor, nature of work, Limited Avenue for career progression and demographic profile. Managers are adopting practices such as job rotation; leadership training to increase managerial bandwidth and employee royalty; outsourcing boring work and retaining high value added work; improving work environment and employee voice; higher education opportunities tied to employment and making the workplace fun place and certification among other innovative measures. All these innovative practices are due to the bad consequences of Taylorism and Fordism. Fordism and Postfordism as institutional regimes of competition also have implication for management approaches. Vidal asserts that over one-third US employment is in low-autonomy jobs and also in bad jobs in regards to quality. He also asserts that Fordism offered decent jobs which are more secure, offer high-wages and offered opportunity for training and promotion as organisation was hierarchical in nature (Vadal 588). However, there continues to be structural demand for low-autonomy work due to dominant logic of employment externalisation in postfordism. Fordism was based on internalization logic hence emphasis on competencies and union pressure for worker protection hence high-wages. Postfordist best practice or logic is externalisation. Internationalisation and competition led to low wages which are performance-related and shift from manufacturing to service sector. Workers are subjected to market pressures hence deunionisation and degradation of low-autonomy work (595). Organisations also have adopted flatter hierarchies hence reduced room for promotion and training. Crowley et al (2010) views the Postfordist era as that of neo-Taylorism as it only intensifies those management principles that were ignored by Fordism in manual work and professional work. The era is characterised by increased layoffs as right people are selected, increased outsourcing, and increased use of project-based teams. One extension of Taylorism is worker input whereby workers are asked to suggest improvements to work procedures thus increasing commitment on job and more harmonious employment relations. The implication for this is overworking and reduced peer cooperation; job insecurity; flattened hierarchies and increased chaos. There is also increased pressure for professionals to perform since they are evaluated based on reputation (Crowley et al 2010). Increased competition between peers is also apparent among professionals leading to horizontal conflict and acute stress. Taylorism and Fordism also cause changes in work organisation as evidenced by use of project-teams. Jones (2002: 19) identifies another form of organising namely Total Quality Management. Introduction of such techniques in Hotpoint organisation was to enable shop floor workers to analyse own activities. However, workers are not enthusiastic about applying such techniques as it only seeks to make them work harder. Conclusion Contemporary management approaches and practices are a culmination of principles designed by Taylor and Ford in their effort to increase economic efficiency and labour productivity. Taylor introduced two concepts of worker selection and worker innovation which affect how organisations operate and relate with employees. Selecting right people for right job is crucial even today for efficiency. Allowing workers to give their input decisions is also vital. These lead to commitment and loyalty, performance-based pay, peer competition, job insecurity and outsourcing. There has also been increased entry of young graduates and college students in the workforce thus deunionising firms. Managers are forced to devise coping strategies to deal with resulting challenges such as use of TQM, improving work environment and offering opportunities for career growth and promotion. References Allan, C., Bamber, G. J and Timo, N. (2006). Fast-food Work: Are McJobs Satisfying?. Employee Relations, 28(5), 402-420. Beynon, H and Nichols, T. (Eds.). (2006). Patterns of Work in the Post-Fordist Era: Fordism and post-Fordism. Edward Elgar Publishing. Bryson, A., Gomez, R., Gunderson, M, and Meltz, N. (2005), Youth-adult differences in the demand for unionization: Are American, British and Canadian workers all that different?, Journal of Labor Research, 263(1), 155-167. Crowley, M., Tope, D., Chamberlain, L. J., & Hodson, R. (2010). Neo-Taylorism at Work: Occupational Change in the Post-Fordist Era. Social Problems, 57(3), 421-447 Jones, O. (1997). Changing the Balance? Taylorism, TQM and Work Organisation. New Technology, Work and Employment, 12(1), 13-24. Kuruvilla, S. and Ranganathan, A. (2010), Globalisation and Outsourcing: Confronting New Human Resource Challenges in Indias Business Process Outsourcing Industry. Industrial Relations Journal, 41(2), 136–153. Smith, V (2001), Crossing the Great Divide: Worker Risk and Opportunity in the New Economy. Ithaca, NY: Cornell University Press Taylor, FW (2007), The Principles of Scientific Management. Filiquarian. Vidal, M. (2013). Low-Autonomy Work and Bad Jobs in Postfordist Capitalism. Human Relations, 66(4), 587-612. Read More