for the general superintendent of the plant, and one to be posted in the division. Any representative proving unsatisfactory to not less than two-thirds of the workers of his division may be recalled and a successor elected.

The actual working of the plan is as follows: Any man having any grievance, or any matter on which he desires to have a decision, shall first present the subject to his immediate foreman or superintendent, either in person or through his representative. If unable to secure a satisfactory adjustment, the representative shall present the matter in writing for consideration to the Plant Conference Committee. If, in the judgment of the committee the grievance is a just one, they present the matter in writing to the general superintendent, who shall then confer with them, with a view of reaching a satisfactory settlement. The general superintendent, if he so desires, may call into this conference all of the division representatives. This has not as yet occurred in our plant. If the general superintendent and representatives are unable to agree on any question, the matter shall be referred to a committee, consisting of the general superintendent of all the plants of the company and all members of the Plant Conference Committees of all the plants. The combination is known as the General Committee. On all propositions submitted to this committee, the general superintendent shall cast one vote for the company, and the conference committees shall cast one vote for the employes. If this committee can reach no agreement, the matter shall be referred to arbitration. One person shall be elected as arbitrator if all parties can agree on his election, otherwise, there shall be a board of three arbitrators, one selected by the president of the company, one by the employe members of the General Committee. These two, if unable to agree, select a third arbitrator. The decision of the arbitrator or arbitrators shall be binding on both the company and the employes. Additions and amendments can be made to this plan when changing conditions or other circumstances make such change necessary.

Thus, in this most democratic manner are grievances adjusted. As a sample of the work done in this connection since the signing of the armistice, the working force of this plant has been reduced, due to lack of work, from about 11,000 to about 4,500, entailing innumerable changes and adjustments. These were made by the

managements, with the coöperation of this committee to the entire satisfaction of all parties.

Much of the matter written on the subject of collective bargaining is pure theory. What the writer has just said in regard to a system of collective bargaining is neither an argument nor a theory; it is a fact. The plan works; indeed, it has been a success from its inception and, as the workers become more and more intimate with its details, its succcess in the future is assured.

The advantages of all this to the workers are almost incalculable: it adds much to the dignity of his job and lifts him out of the depressing rut of drudgery, by giving him a part in the management of the plant, in so far as working conditions, discipline and welfare are concerned. Its benefits to him are to be measured only by the wisdom and energy with which he grasps the opportunities and meets the obligations afforded by this plan.

The advantages to the plant are just as vital, because it results in a strongly organized, efficient, well disciplined working force, in which every confidence can be placed. Self-respecting men contented with their jobs, giving their best, with the assurance that their rights will be recognized and their wrongs redressed, will make a working force that means peak production, with a minimum of friction and a minimum loss of money due to a large labor turnover. It may be a simple matter to fill a plant with men, but to get together a smooth working force is often an extremely difficult proposition.

One of the adverse criticisms of this plan is that men meeting in company time on company property cannot truly represent their fellows, that only men favored by the company can be elected as representatives and that all their activities are inspired and controlled by the management. Criticism of this sort we respectfully submit is a severe arraignment of the capacity of the worker to govern himself. If he is not fit to govern himself in an open shop, his case is hopeless, for the law of averages applies here as it does everywhere and the workers in an open shop are just as conscientious and just as independent as they are anywhere else. A careful reading of the details of our plan should be answer enough to such criticism of the future of such a scheme.

In this age of democracy, when men everywhere are trying by all sorts of means to lift up and improve living and working con

ditions for everyone, with striking force there comes the old Biblical injunction, "Come let us reason together." This, if accompanied by mutual respect and confidence, together with a growing desire and demand for improvement at all times and the knowledge and faith that experience alone can give, will sooner or later bring us a long way toward solving the problems that have confronted employer and employe alike in the long past.

Statistical Control Including Costs as a Faetor

in Production

By HARLOW S. PERSON

1

Managing Director, The Taylor Society, New York City

General. A manager desiring to determine the best place at which to locate a particular type of retail store, considers possible locations from many points of view, including casual observations of the places where the greatest number of possible customers seem to pass. He then stations at each of these places an observer who, in a square on a tally-sheet ruled in a carefully predetermined manner, makes a mark as each person passes. After the observations have been completed and the marks in the various squares are counted, the manager is enabled to establish a number of facts pertinent to the problem such as the following: the average number of persons who pass during a day; the average who pass each hour of the day; the average number of men who pass each hour of the day; of women; of children; the number of office girls who pass during the lunch hour; etc. These group facts, discovered by recording and classifying the mass of unit facts, are of importance in helping him to decide a problem of business policy.

If a merchant sells hats for a season and keeps no record of sizes sold, he is at a loss to place precise orders for the next season. He may have a general impression that he had better place in stock more of a given size than of other sizes, but a "general impression" is not precision, control and economy in operation. On the other hand, if he has kept records, he may find he has sold 50 size 6; 150 size 62; 300 size 7; 500 size 7; 400 size 7; 150 size 7; etc.-in all some 1600 hats. He estimates that his sales will amount to 2000 hats next season and divides the order for that number in the ratios with respect to size, of .5, 1.5, 3, 5, 4, 1.5, etc., and feels certain that he is forecasting his market with precision.

These illustrations should suggest to the reader the nature, the

1A Society to Promote the Science of Management, Engineering Societies Building, 29 W. 39th Street, New York City.

purpose and the methods of statistics in business. An illustration might have been used in which facts are entered on "forms in an office, as documents resulting from operations and carrying different kinds of data (units of product; wages; sales; complaints; prices of materials; etc.) pass through the office. The magnitude of the business, the volume of the data, the number observed, recorded, classified, compared and otherwise handled, make no difference.

Nature and Purpose of Statistics. A "fact" the relations of which are obscured has little or no significance. (A single person passing the observer in the first illustration has no meaning or importance. Related to the problem of locating the store he begins to assume importance. Related to that problem as one person in an aggregate of persons passing the observer, he becomes in this relationship of great importance; but by becoming part of an aggregate of persons he is transformed into one of a mass of data so numerous as to confuse the mind, which is limited in its processes of observing, valuing, remembering and comparing separate experiences which come to it casually. The mind is unable to grasp the significance of larger summarizing facts behind or contained in the mass. Yet there are summarizing facts there, facts which result from the bringing together and analysis of the aggregate, Statistics is the science and the art of handling aggregates of facts-observing, enumerating, recording, classifying and otherwise systematically treating them-so that other "master" facts or principles or laws lying behind or contained in the aggregate are made comprehensible to the mind and become, along with the results of other methods of investigation, data for reasoning, the drawing of conclusions, the making of decisions and the determination of policy.

Statistical Methods. There have been developed many devices for the summarizing and analysis of statistical data such as the per cent and the arithmetic average. No manager of a plant of any size, for instance, could carry in his head the number of hirings and separations for two or three years. Yet if recorded these facts can be classified and summarized through the medium of coefficients, and the mind can easily reason in terms of the coefficients, which sum up group facts behind the unit facts. That labor turnover was 43 per cent in 1918 and 27 per cent in