,
Chapter 7
The ‘Americanisation’ of
productivity, 1948–51
Periodically in the twentieth century British firms and governments, conscious of the economy's relative decline, have turned to the USA for a model of how things might be done better.1 The late 1940s was one such period. As on previous occasions, looking across the Atlantic for ideas to improve efficiency and productivity was conditioned by a range of short-term factors, and these also shaped what was seen as relevant in the US model. This chapter focuses on the causes and effects of the Labour Government's attempts to encourage British industry to adopt features of American production techniques, especially but not only via the Anglo-American Council on Productivity (AACP).
It should be emphasised that this was by no means the only aspect of ‘Americanisation’ in the period. Private sector companies without any government role were, albeit to a largely unknown degree, attempting to borrow from US practice. As Clark notes: ‘American influences in Britain were continuous from the 1890s onwards and their presence went through successions of peaks and troughs. British firms did track American developments and create fragile and particularistic channels of learning about products, processes and work organisations.'2
Another source of American impact on British industry was US multi-national investment in Britain. Whilst the main initiative here was of course private, it was facilitated by a general policy of encouragement from British governments, including those of Attlee. In 1949, the Cabinet Economic Policy Committee reasserted that position, ordering that US direct investment proposals be encouraged ‘provided that they contribute either (a) to our dollar viability by dollar saving or dollar earning, or (b) to our general economic recovery by supplying US techniques, know-how, patented processes’.3
The content of ‘Americanisation’ was always ambiguous, and its precise meaning in the debates and initiatives of the late 1940s is considered later. But one notable feature of Americanisation in other countries at this time was strikingly absent from Britain — vigorous anti-trust policies. In the defeated enemy countries of Germany and Japan anti-monopoly and anti-cartel measures were central, at least initially, to Americanisation. By contrast, in Britain anti-monopoly policy was a very damp squib, notwithstanding the passing of the Monopolies and Restrictive Practices Act 1948. As Helen Mercer shows, the Act's impact was reduced to very little largely because the Board of Trade, which both filtered applications to the Monopolies Commission and adjudicated upon its reports, was effectively influenced by business interests.4
The creation of the AACP in 1948 reflected the convergence of both the British and American administrations’ concern with productivity. The origin of the British Government's involvement has been dealt with in earlier chapters. For the American side the creation of the AACP was closely linked to the general policy of economic aid to Western Europe under the Marshall Aid programme. Marshall Aid's overall objectives and effects have been much debated,5 but in the present context the most important point to note is that, as well as giving immediate aid in order (allegedly) to stave off economic collapse and Communism, it embodied a ‘politics of productivity’. This rested in part on the belief that increases in productivity had ameliorated social conflict in the USA itself, which in turn led to the idea that the long-run stability of Western Europe could be secured if growth and productivity were to be encouraged by US policy. Thus, Marshall Aid became to some extent about exporting American techniques of production in order to secure the perceived benefits of an American-style social peace.6
In this broad context the specific idea for the AACP emerged from a meeting between Stafford Cripps and Paul Hoffman (head of the European Co-operation Administration) in the summer of 1948. The note of this discussion is quite revealing about the attitudes which the British Government held at this time:
The Chancellor said that he recognised the great interest which the Americans took in productivity. He had himself taken a lead in this matter over the last three years and it was indeed vital for the U.K.
He therefore welcomed the suggestions that the US should help us in this matter; but it was vital, if the conservative outlook of both employers and labour was to be broken down, that any arrangements should be made by industry itself and not imposed upon industry by action of the two Governments.7
Cripps's reaction was conditioned not only by his prior interest in productivity but also by his recognition of US sensitivities about how far European countries were making their own efforts at economic expansion and adjustment and not just relying on Marshall Aid to bale them out. Thus, whilst the AACP was never a formal condition for the receipt of Marshall Aid, it was based on a recognition by the British Government that the giving of Marshall Aid was a contentious issue in the USA, so that it would be foolish not to respond to US initiatives which might ease its political passage in Congress.8
Cripps was clearly also very sensitive to the politics of the proposal in Britain. He secured the support of the official representatives of the employers and unions, but both bodies interpreted the matter in the light of their own concerns. The FBI had already been alerted to the very unfavourable view being taken in the USA about British industry's performance. The head of the US Department of Labour Productivity Division, L. Silberman, had visited Britain in early 1948 and, ‘although very friendly’, had ‘formed a devastatingly adverse view of British productivity’ which compared ‘even worse with American than he had been led to expect’. The FBI's response was therefore to welcome the AACP as an opportunity for correcting ‘ill-informed or self-interested’ criticisms of British industry by Americans, and, at the same time, reducing the Labour Government's role in the productivity issue by placing ‘the whole of this question firmly in the hands of industry itself.9
Similarly, the TUC had its own views as to why the AACP should be supported. At the General Council meeting when the proposal was approved, Jack Tanner of the AEU argued that ‘criticism has been levelled by certain Americans on semi-official visits to this country not against British workers but against managements, and he thought it would not be harmful for American industrialists to realise the difficulties which British industry was facing’. Like the FBI, the TUC had earlier been hesitant about the Government's proposals for a renewed productivity drive in the autumn of 1948, involving direct official contact with workers and employers via local and national conferences. Both bodies to a certain extent wanted to keep government at arm's length, away from ‘their’ members, and saw the AACP as means of achieving this.10
Endorsement by the peak associations of capital and labour did not mean unanimous support for the AACP. A letter from Hornsey Trades Council to the TUC reflected an extreme version of what was, perhaps, a widespread view on the Left: ‘The introduction of American methods such as the Taft-Hartley anti-T.U. bill, the use of tear gas against strikers, lynching and the Ku Klux Klan, will not increase productivity.'11
The AACP proposal in fact touched a raw nerve of anti-American sentiment, evident across the political spectrum.12 In announcing the idea Cripps went out of his way to stress the agreement given by the FBI and the TUC, and emphasised that the AACP was proposed ‘not on the basis of our industries being inferior to those of other countries’, but because ‘an exchange of experience and knowledge of production would be of great benefit to this country’.13
Given this endorsement, if not enthusiasm, the AACP was established in 1948 as a bipartite body, with representatives from the BEC as well as the FBI, the TUC and employer and union representatives from the USA, but no government members. It was intended that the organisation's life would be coterminous with Marshall Aid, that is, ending in June 1952. In the early stages the AACP established a five-part programme of work for itself: (i) plant visits and exchange of information on production techniques; (ii) an enquiry into maintenance of productive plant and power; (iii) productivity measurement; (iv) an examination of specialisation in industrial production; and (v) the collection of economic information. The last four of these objectives spawned committees, all of which reported rather inconclusively in 1949. This reinforced the dominance of team visits to America as the AACP's main activity (in fact the only one for which it is usually remembered). By the end of its existence the Council had arranged 49 team visits in specific industries, and 17 on specialist subjects (for example, management education). Three visits of US teams to the UK were also organised.14
The role of the AACP in the productivity drive of the late 1940s must be partly seen in the context of the agenda set by its major participants, the peak associations. Certain areas, notably restrictive practices (by both firms and labour), were ruled out as specific objects of enquiry by the British participants, despite the Americans’ view that these were likely to be important in explaining Anglo-American differences in productivity. Such questions were simultaneously said to be a ‘purely British matter’, to be fairly unimportant and, in any case, to be welcomed where they existed by both employers and unions in Britain because they encouraged ‘stability through organisation’.15 Parallel to this kind of exclusion was a pact not to consider anything to do with labour relations: ‘all agreed that there was to be no interference with the normal negotiating machinery and procedure of industry’.16 However, none of these issues could be effectively excluded from the team reports, a point considered later.
More positively, both the employers and unions had various ideas as to what they thought the AACP should focus attention upon. The FBI, in setting out its ‘fundamental considerations’ in agreeing to the AACP, emphasised three points. It argued that:
(a) lowest cost should be the criteria of efficiency rather than production per man hour;
(b) greater efficiency was constantly barred by restrictions on capital developments;
(c) the big problem in efficiency is bottlenecks in materials and supplies.17
The first point related to the FBI view that production per man hour comparisons with the USA were, despite their popularity, unfair and inappropriate because they did not reflect the higher capital intensity of US production and thus distorted the overall efficiency differences. This was a highly important issue for the whole productivity drive and will be considered several times in the following pages. It clearly links to the second point, the belief of the FBI that, under Labour, investment had become the ‘residual legatee’ of resources rather than the first call. The Government's view was that, contrary to this assertion, it was giving a high priority to investment, but that, especially because of the need to divert resources into exports, there was a limit to what might be achieved on this front, and in any event much more could and should be done to raise output with existing capital equipment. The last point was a staple complaint of the FBI in this period, linked to the belief that controls were excessive and should be removed more rapidly. Thus, from the FBI point of view, the AACP was largely a forum for pressing a pre-existing and well-known agenda of issues which it saw as crucial for productivity.18
However, there was also recognition that by involving unions the AACP could function to raise questions in a rather different way than the normal diet of FBI representations to the Government. An FBI draft report on the AACP in 1950 argued that productivity was basically an issue of ‘men and machines’. Given that machinery was largely outside the AACP remit, the focus should be on men. In this context it was argued that the Council could ‘influence the psychological approach and affect the climate of opinion':
Productivity consciousness is a long step towards the realisation of high productivity. It is in helping to promote this that the Council believe that its work has been and is of the greatest potential value.19
There is a clear parallel between the FBI and TUC approaches to the AACP. On the one hand they both wanted to use it to press their own hobby-horses; for example, in the case of the TUC, the importance of Joint Production Committees. Equally, both were convinced that in the long run higher investment was the crucial element in raising productivity. But the TUC, like the FBI in its more reflective moods, accepted that in the short run the level of capital equipment had to be taken as given. What, therefore, was left? With restrictive practices and industrial relations ruled out, the TUC, like the FBI, tended to end up with a rather vacuous psychologism. Thus, Tanner from the AEU argued that: ‘if we are going to get any immediate results it does mean improved and increased co-operation between management and work people’. Naesmith from the cotton weavers saw this co-operation as being something to be spread from the peak associations to the shopfloor: The issue with us is how to get the people in the mills and factories and the workshops themselves lined up on the need for change and the way in which the changes should go.'20
The sectoral teams sent from Britain to the USA all consisted of representatives of both employers and employees, with the latter supposed to include supervisors, technicians and those from ‘workshop level’, including operatives and shop stewards. In practice, the composition of the teams was a persistent bone of contention. Early in 1949 Harries at the TUC wrote that the whole idea of team visits was ‘going badly’ because some trade associations were insisting on sending non-trade unionists.21
It was subsequently agreed that the procedure would be for the AACP to invite employers’ associations to ask firms if they wished to nominate people for the teams; that they would be requested to do this in collaboration with trade unions; and that they would also be questioned as to whether the unions agreed to the nominations. This looks like, and seems to have functioned as, a rather uneasy compromise between the supposedly bipartisan character of the AACP and the fact that much of the non-dollar cost of the visits was borne by employers. The composition of the teams was also affected by the Americans screening-out communists on security grounds.22
Only one detailed account of a team visit seems to have survived. This is a case study relating to the making of the Cotton Spinning Report, by P.H. Cook of the Tavistock Institute. In this instance the worker members were nominated by the unions, and the eventual report was strongly endorsed by the employee side. Cook saw the team's efforts as making a ‘serious and important contribution to its industry’ and emphasised the importance of good communications within the team for its perceived success — a very Tavistock point of view.23
Like all of the other teams, that on cotton spinning was sent around factories in Britain before it went to the USA. This ‘briefing tour’ involved visiting 17 companies over a fortnight, before a six-week tour of the USA which covered 35 plants. On the team's return, 29 meetings were held to publicise its report and findings, and the average attendance at these was said to be in excess of 100 people.24
This pattern was similar to that for most of the teams, though whether all were quite so easily co-operative is unclear. Cotton spinning was perhaps atypical in the collaborative character of its industrial relations, though in most cases the ‘screening’ process seems to have ensured a minimum of discord amongst team members. Controversy arose most explicitly in cases where the unions felt that team membership had been ‘fixed’ by employers in order to secure a report favourable to themselves. For example, the Foundry Workers’ Union protested ineffectively about the composition of the Steel Founding Team. When the team's report was published the union produced its own counter-report, which earned it a dressing-down from the General Council of the TUC on the grounds that ‘[the union] had obviously sought to influence shop stewards to take an antagonistic view of the Report’.25
What message did the majority of team reports carry about the sources of Britain's low productivity compared with the USA? With 66 reports on diverse industries, and the politically charged nature of the issue, it is not perhaps surprising that different authors have drawn rather different conclusions on this subject. For example, Broadberry and Crafts have tended to emphasise the overmanning and restrictive practices that were ‘revealed’ by the reports.26 Carew, by contrast, stressed the general social-psychological approach of the reports, with their belief that the particular character of American labour was vital. Coupled to this, for Carew, was an emphasis on the need for ‘scientific management’ as in the American model. In this account, therefore, the most important aspect of the AACP was its ‘ideological challenge to basic labour movement values’.27
Though having very different views about the accuracy of the AACP diagnosis of Britain's productivity problems, both Broadberry and Crafts and Carew tend to focus attention on issues concerning labour. Is this a fair portrait of the reports? It must be conceded at once that the reports did contain a great deal of rhetoric about the alleged differences in labour attitudes and industrial relations between the USA and Britain. This derived partly from the ‘lowest common denominator’ kind of approach of the FBI and TUC to the AACP, and was no doubt encouraged by the bipartisan nature of the teams.
Much of this material was by its very nature ill-focused and lent itself to vacuous generalisation. As a contemporary critic noted:
The teams, it seems, have found the real secret of high productivity; it lies not in machinery, not in factory layout — in short not primarily in technical improvements, but in the American Way of Life. If only the American Way (the reports suggest) could be transferred to Britain, how hardworking, how comfortable everyone would be.
This approach perhaps reached its nadir in the Grey-Iron Founding Report, which remarked upon the observed great energy of New Yorkers, and noted: ‘Several members of the Team were infected by this energising atmosphere and enjoyed a greater capacity for activity and less need for sleep than was customary for them in Britain.'28
Rather little detail was given about industrial relations in the team reports. Whilst much is said about the technical aspects of production, the allegedly ‘central’ issue of workers’ attitudes and behaviour is ill-supported by evidence. Oddly enough, the only report to have comparative figures on industrial relations showed more days lost by strikes in the USA than the UK.29 This may, of course, partly reflect the desire of the employers and TUC to keep restrictive practices and the specifics of industrial relations off the AACP agenda.
A detailed contemporary study compared the assertions of the AACP reports with evidence from American industrial relations literature to see how far US practices were as presented in the team reports. The overall conclusion was that the American worker appeared much less different from the British worker than the AACP suggested: ‘We can see, then, that the Productivity teams, excellent though they were on the technical aspect of production, gave a misleading picture of the American worker and his trade union.’ The study went on to speculate how this misrepresentation might have arisen, given the union involvement in the teams. It noted the short time spent in the USA, the desire that some had to ‘shake-up’ British labour, the selective nature of the firm visits within the USA (with four out of five firms approached by the AACP withholding co-operation) and the psychology of intensive visits in a collaborative team framework.30
In part, therefore, the AACP can rightly be seen as just one more instalment in ‘the British Worker Question': the long-standing process of blaming labour for the ills of the British economy.31 Certainly the TUC was alive to the extent to which a certain kind of essentially anti-union propaganda could be read off from the team findings. It responded very critically to the ‘Fleming-Waddell’ report, an internal AACP summary of the first fifteen team reports, which it saw as ‘overweighting atmosphere and psychological factors’ and playing down the machinery and investment aspects of higher US productivity. This indeed was a general problem for the TUC, as it tried to balance support for the AACP with criticism of those who used the reports only for propaganda.32
However, it is worth emphasising that the reports generally contained a good deal of substantive material which is not about workers and their attitudes. Carew, whose main interest is in labour relations, and who relies largely on TUC sources for his discussion of the AACP, rather glosses over this other material, simply saying that it focused on ‘scientific management’. Broadberry and Crafts similarly mention the AACP critique of British management, but focus on the restrictionism of labour since this fits in more with their economists’ assumption about the importance of competition in labour and capital markets.33
An analysis of 58 team reports prepared in 1952/3 shows that the main factors that they deemed responsible for the US lead in productivity were as follows. Heading the list were ‘extensive use of mechanical aids’ and ‘appreciation by work people of need for higher productivity’, followed closely by three questions of ‘managerial technique’ — ‘modern methods of costing’, ‘production planning and control’ and ‘work study’.34
Thus, alongside the almost mandatory reference to workers’ attitudes, emphasis was placed on a range of factors which related either to low levels of investment in Britain (which, as we have seen, both the TUC and FBI accepted but regarded as unchangeable in the short run) or to managerial practices broadly defined. This was not, of course, the kind of finding which the FBI wanted from the AACP, though it had always been anxious that this might happen. As Middlemas remarks: ‘In this sense, the FBI's fears were justified: the long-term thrust of the Marshall Aid experience highlighted management inadequacies, not those of the workforce.'35
The critique of management even comes across quite strongly in Hutton's We Too Can Prosper, despite the TUC's feeling that the author of this book had succumbed to the AACP disease of broad psycho-logistic generalisation without supporting evidence. Hutton's first substantive chapter was called ‘Better management, higher productivity’ and cited as evidence of the superiority of American management the summary of 22 team reports in the appendix of the AACP's Education for Management.36
The AACP concern with management raises a much broader issue about the forms of management that ‘Americanisation’ was held to entail in the late 1940s. This issue is considered later in the discussion of other components of government activity which also aimed at encouraging British industry to adopt (perceived) American methods. In many ways the questions raised there fell outside the institutional character of the AACP. However, that institutional character needs first to be considered in a little more detail.
General questions about the impact of Labour's initiatives on productivity, together with an overall assessment of the AACP, are considered in Chapter 8. Here the focus is on the peculiarities of the AACP as an agency for raising productivity. As so often with the impact of an institution, there are great difficulties of interpretation, because no one criterion can be applied. Clearly different actors hoped for different things from the AACP. The Government hoped to appease American criticism of British economic policy and performance and so help to secure the continuation of Marshall Aid, while at the same time encouraging union and employer enthusiasm for the productivity effort. The USA had high hopes of the AACP and felt that these were being realised. Its participating representatives recognised that the AACP formed a ‘temporary defensive alliance’ between the FBI and TUC rather than an enthusiastic partnership. This stemmed from what was seen as the defensiveness of the British participants about the causes of Britain's lagging productivity — allegedly demonstrated by the refusal to confront restrictive practices, the ‘over emphasis’ on higher investment as the key to progress and the general refrain of ‘British practice is suited to British conditions’.37 However, these drawbacks were never serious enough to threaten what was seen as the major gain, the acceptance of the need to raise British productivity by following the American example.
Politically, the Government was committed to a ‘hands-off’ approach to the AACP. The difficulty with this from the Government's point of view was how to respond if the Council was seen to be insufficiently active or doing inappropriate things. This issue came to the surface in the autumn of 1949 when the US Government put forward proposals aimed at increasing technical assistance to Britain. The issue for the Government was how far this was to be channelled via the AACP. Doubts on the desirability of using the Council were voiced by some senior civil servants, who noted that the AACP had not supplied government departments with its minutes, and indeed seemed to be working very hard to minimise any kind of liaison or contact. So the technical assistance proposal raised a dilemma: should the government reconcile itself to the various disadvantages of handing the whole thing over to the Council or should it think out some way of enabling the official machine to work openly with the Council and find a formula acceptable to industry to explain this state of affairs?38
In the event the Government channelled the increased assistance via the AACP, maintaining the earlier proposition that the Council was more likely to engage British producers, as well as to maintain America's support, if it were seen to be clearly working apart from Whitehall.
For the FBI, to repeat, the AACP was a means of getting government ‘off its back’. The FBI used the Council as a basis for resisting the taking of decisions on productivity elsewhere. For example, it remained aloof from the work of the Ministry of Supply's committee on standardisation by arguing that this work should be done by the AACP. Similarly it suggested that the vexed issue of data gathering for productivity measurement should come under the Council — though this did not lead to any greater co-operation by industry in producing reliable data.39
Overall, therefore, it would seem right to characterise the FBI's response to the AACP as minimalist and defensive. It welcomed the Council as a means of combating US misperceptions of Britain and keeping the Government at a greater distance, rather than as a significant initiative in the battle to raise productivity in British industry.
Some of the same attitudes were shared by the TUC. But the productivity issue was more complex for the union side than for the employers. On the one hand, it was ‘their’ government which was setting so much store by raising productivity, and, as a central component of the Labour Movement, the unions could hardly ignore the political emphasis given to this objective. On the other hand, many union officials understood that Anglo-American comparisons were being used to attack trade unionism. The broad character of the TUC's response to this dilemma is clear. In public, it embraced the AACP with great enthusiasm. Yet, in private, it acted to try to restrain both the wilder rhetoric of the ‘American Way of Life’, with its usual anti-union implications, and the Left's criticism of some of the AACP material. Hence the TUC became politically committed to the idea of the AACP to a much greater extent than the employers.
As indicated in earlier chapters, the TUC was willing to go to unprecedented lengths in support of the productivity drive. Though not strictly part of the AACP, this support is well illustrated by the TUC's own Team Visit’ to the USA in 1949. What was striking in the report which emerged from this initiative was the extent to which unions were encouraged to see productivity as their responsibility. As the document put it, the ‘real problem confronting trade unions was to find ways and means of increasing productivity’. In pursuing this theme the role of American unions seems to have been substantially exaggerated, as when the report claimed that unions there made ‘a major contribution to increasing the efficiency of less competent companies’.40
As Carew has persuasively argued, such conclusions were poorly supported by the evidence unearthed by the TUC. In fact, US pressure had produced a rather more ‘up-beat’ report which in effect recommended ‘American’ practices to the British even though these were rarely actually pursued by US unions. One result of the visit was the creation in early 1950 of the TUC's own Production Department, which focused attention on spreading the gospel of productivity amongst rank and file trade unionists, especially by providing training in management techniques for such people.41
In sum, union leaderships to a striking degree in this period saw their role as encouraging the productivity drive, though they often believed that this could be done more effectively by the unions themselves than by the heavy hand of government. Nevertheless, this attitude did not lead to a significant radical ‘productionism’, involving a challenge to managerial prerogatives on the grounds of management inefficiency. As the Director-General of the FBI reported:
I must say I have been much impressed by the recognition by the T.U. members of that Council that each side has its own distinct function, and I feel there is no danger there of collaboration leading to encroachments by the trade unions on to the field of management.42
The AACP was created for a political purpose as much as directly to raise productivity. Equally, the support of the peak associations for it was part of a political ‘deal’ between them and the Government. Its economic impact (considered in Chapter 8) must be seen in the light of this political situation. In particular, the FBI continued to be quite successful in using the Council to keep government out of certain areas related to productivity, whilst resisting any enlargement of the unions’ role in this issue. In this sense the AACP may be seen as a case study of the problems that were encountered by the Attlee Government in its pursuit of policies via ‘corporatism structures of close co-operation and indeed significant dependence upon the peak associations.43
For many, the crucial issue in the attempts at ‘Americanising’ British industry in the immediate post-war period revolved around ‘scientific management’.44 Carew's discussion of the AACP, for example, presents the key ‘success’ of that body in terms of the growing acceptance amongst British labour of scientific management, which it had previously resisted. Like many authors, Carew does not offer a definition of scientific management but tends to treat it as synonymous with Taylorism, in other words as concerned with the direct role of the worker in production, or what in recent years has often been called the ‘labour process’.45
Whilst this equation of scientific management and Taylorism is appropriate for much of the early period of the scientific management movement before and after the First World War, it is very much less so in relation to the 1940s. Writers such as Urwick and Brech, for example, had incorporated much of the contemporary human relations approach into what they called scientific management.46 Similarly, a major managerial ideologue such as de Haan could remark of scientific management that: ‘increasing output and raising efficiency are its technical and economic goals, while its social purpose consists of careful treatment of the human factor in industry and of the raising of the standard of living of the community’.47
Even where the definition of scientific management did not include the whole human relations package, it usually referred to a range of issues beyond the focus on labour. It might therefore embrace subjects such as production organisation, production control and managerial techniques which fell between ‘the labour process’ on one hand and human relations on the other.
This background to the events of the 1940s is important because, in order to understand the significance of the debate about scientific management and Americanisation in that period, it is necessary to define the meaning and connotations of these terms with some care. To that end this chapter will schematically divide the package that was being proposed into three: standardisation (or, with simplification and specialisation, what were often called ‘the three Ss'), standard costing and budgeting, commonly seen as a crucial accompaniment to standardisation; and work study, including time and motion study. Together, these techniques would seem to define the main thrusts of the Americanisation of production in this period, along with the human relations perspective, which was dealt with in Chapter 5.
,Perhaps the longest standing adverse comparison of British and American industry was in terms of the scale of its units of production. The argument that British firms were too small to compete effectively with those in the USA goes back to at least the First World War, but came to prominence in the ‘rationalisation’ movement of the 1920s and 1930s. Very generally put, this movement proposed inter alia that Britain suffered from too many small units which were unable to realise the economies of scale that were available to larger scale firms. A key corollary of rationalisation was mass production of a standardised product.48
In the inter-war period the main focus of the rationalisation movement was on the depressed staple industries such as iron and steel, coal and cotton. But in the Second World War attention shifted somewhat to the consumer goods industries, encouraged by the policy of concentrating their production in fewer units, and only allowing the manufacture of utility (i.e. standardised) goods.49
This latter orientation was carried over into the Working Party investigations of the 1945–7 period. As Chapter 4 demonstrated, these were enquiries by tripartite (employer/union/independent) bodies into a range of consumer goods industries. Some proposed programmes of rationalisation or ‘re-equipment and consolidation’ in order to gain the (alleged) economies of scale from larger units producing larger runs of output, and this was most strikingly so in the case of cotton.50
The cotton recommendation is a classic example of the proposed ‘Americanisation’ of an industry which was based in part on previous comparisons with US experience. The relevance of the American model was also vigorously disputed by a dissenting member of the Working Party, the economist John Jewkes. He argued that the production economies of scale in the industry were quite limited, and that the danger of inflexibility stemming from mass production was high. In sum, he felt that it would be ‘a fatal mistake to allow the claims for mass production, standardisation or bulk selling to conceal the increasing reliance which ought to be placed upon the disposal in the markets of the world of quality products, fashioned in detail to suit the demands of the consumer’.51
Whatever the merits of the ‘Americanisation’ proposals in cotton or elsewhere, the idea of standardisation of production as a major route to productivity increase informed a great deal of the Government's policy in this period. For example, it was a major part of the idea behind Development Councils, Labour's most distinctive proposal for the reorganisation of the private sector.
Development Councils sprang in part from the Working Parties, several of which proposed a permanent tri- or bipartite organisation for their industry. One element in the Development Council proposals was that they would encourage ‘rationalisation’, in the sense of amalgamations and concentration of production. However, partly because of the very strong opposition of most employers (and the FBI) few Development Councils were actually created, with those that were being largely restricted to common service functions — research, marketing and the like. Thus, the high hopes held by both civil servants and some Labour Ministers of Development Councils as major instruments of industrial change were dashed. The whole episode had demonstrated a commitment to standardisation, but this was largely gestural.52
Whilst Development Councils were Labour's most original policy initiative for private industry, and an important channel for ideas on standardisation, they were by no means the only important initiative in this area. The Ministry of Supply had pursued standardisation in its military hardware purchasing during the war period, and carried this idea over into the Attlee years. The direct leverage of the Ministry declined as the volume of government purchases fell off, but standardisation continìied to be pursued in such forums as the Engineering Advisory Council, which was dominated by the employers but in fact reluctantly created under union pressure.53
These efforts became focused on the Lemon Committee, which was set up to look at the whole issue of standardisation in engineering. Its report came out strongly in favour of the benefits to be gained from increased standardisation, and in particular advocated an expanded British Standards Institute (BSI) to pursue this objective. Whilst employers seem to have generally welcomed the Lemon findings, they were emphatic that any enhanced role for the BSI should not encroach on the voluntary nature of standard setting. Their insistence was based on two points. First, they argued that if standardisation were pressed too far it would threaten innovation and technical change. Second, it was felt that the BSI could become an agency for increasing government control of the private sector, about which employers were, of course, extremely sensitive, not to say paranoid, in this period.54
The BSI was expanded in the late 1940s, and this involved further government money pro rata with money from industry. The Ministry of Supply used the Lemon Committee to cajole engineering employers; some responded, but they continued to insist that this was a matter for the industry itself, and in particular the trade associations. Some of these associations had an existing concern with the issue, which may have been accentuated by government pressure. For example, the associations of locomotive manufacturers and aircraft constructors continued to be active in this area.55
However, these two examples point to a major issue in the standardisation debate. Locomotive manufacturers, almost entirely, and aircraft producers, to a significant extent, were dependent on the public purchasing of their output. Thus, in both industries standardisation was encouraged by the purchaser. In the case of the railways this occurred because of policies adopted by the newly created British Railways Board. In the case of aircraft, the position was more obscure; on the one hand, the aircraft trade association, the Society of British Aircraft Constructors (SBAC), stressed its independence from government while, on the other hand, there was a mandatory requirement by the Ministry of Supply for the use of SBAC standard parts in aircraft bought by the British government.56
There was a general attempt at Cabinet level to try to get public purchasing used as an instrument of standardisation, but the results seem to have been very uneven. Standardisation was successfully achieved in electricity generator sets, though how far this was economically desirable is debatable. For the full benefits of standardisation to be achieved there must obviously be utilisation of the most efficient design, without any inhibition of technical change. This is always a difficult balance to achieve.57
The publication of the Lemon Committee Report was timed to coincide with an AACP enquiry into Simplification in Industry. This, like so much of the material during these years, argued that ‘any organised and determined effort to reduce our manufacturing variety still further could make a rapid and major contribution to increasing productivity and lowering costs in British industry’.58
The AACP document was followed up in 1950 by a report on progress over simplification. This gave a very general overview of activity in relation to the ‘3 Ss’ which suggested that much was happening. Yet its recommendations also noted that ‘a campaign should be launched at once in every industry in which a policy of simplification can be applied’, which implied a need for very much more action.59
Another initiative concerned with standardisation was organised by the Special Research Unit (SRU) of the Board of Trade. This was a unit which was designed to apply operations research to industrial problems and which did a lot of work on productivity, particularly looking at how standardisation might improve efficiency. One of the most interesting SRU studies was of Glacier Metals, which also figured in the discussion
Table 7.1 Estimated savings from increasing batch size of bushes and bearings
| Batch size | % Saving/unit |
| 1–150 | 0 |
| 151–1,000 | 27.8 |
| 1,001–10,000 | 43.2 |
| 10,000–40,000 | 75.2 |
| 40,001 + | 80.8 |
Source: BT 64/2316
of human relations in Chapter 5. Here, the managing director, Wilfred Brown, approached the SRU with data on cost savings available from standardisation. He presented a table which was very much grist to the mill of the standardises (Table 7.1). But it was also made clear that the achievement of such economies would require a radical change in the structure of demand for the products, in this case a change in the components policy of the car industry. Car manufacturers were, in fact, commonly regarded as slow to pursue component standardisation, though there was some movement towards model standardisation.60
Hutton called standardisation, simplification and specialisation ‘the three charmed Ss of high productivity’. Alongside this went an equally hyperbolic emphasis on American management as essentially about cost measurement. American management ‘is measurement’, he argued, adding that ‘all measurements are part of the planning, costing or reaching of targets … because only these measures are made which have relevance to these operations’. However, this was merely an extreme version of a common refrain about the deficiencies of British cost accounting, and the absence in particular of systems of standard costing and budgeting. Thus, almost all of the Working Parties reported unfavourably on the position in this regard. In cotton, for example, enquiry revealed that the industry as a whole lacked ‘adequate knowledge of its cost structure’. A survey of the Working Party publications by the SRU concluded: ‘The Reports find the system of costing in British industry to be, on the whole, hopelessly inadequate.'61
This was a theme, too, of many of the AACP industry reports. The AACP in fact sent a specialist team to the USA to report on management accounting. It argued that the key to American efficiency was US manufacturers’ costing and budgeting procedures, and recommended that British management ‘in considering the future and preparing plans, should make the fullest use of budgeting and forecasting, based on accounting and costing data’.62
The question of economic measurement and productivity engaged a great deal of attention in this period. Much effort was devoted to formulating and then proselytising direct measures of productivity at factory level for use as a management tool. However, this seems to have been largely a dead-end, meeting resistance from many managers who regarded cost rather than productivity measures as more helpful, a view that was supported by the AACP team, which emphasised that in the USA ‘industry makes little attempt to measure productivity, preferring to rely on unit costs’. The AACP report went on to stress that what the Americans had was not different measurement techniques, but much keener attitudes on the intensity and speed of deployment of cost information, and its central role in everyday management activity. The keys were accurate costing, standard costing, and an understanding of their focal role in making production decisions.63
The response of British industry to this propaganda on costing does not seem to have been very enthusiastic. One letter to the FBI commented on the AACP report:
It seems to me to have been compiled by a bunch of rather third rate accountants wearing the blinkers traditional to that profession, with the sole object of trying to magnify the importance of the accountant in industry.
There were more positive reactions, but overall the evidence suggests little changed. During the war costing seems to have improved in areas where cost-plus contracts required more accurate calculations, but after the war ‘the thought in many entrepreneurs’ minds that cost accounting was just another new-fangled administrative overhead could not easily be dislodged’.64
In his survey of British management at the end of the 1950s, Granick argued that:
The single major managerial development of post-war Britain does not really violate the proposition that managerial professionalism is still rejected. For this development has been concentrated in the area of production efficiency and on the lowest level of managerial hierarchy. It is old-fashion work study, bearing the new name of ‘O. & M.'…. While this is undoubtedly highly important for efficient operations, it represents a managerial movement which was revolutionary in American industry during the first decade of this century — but had been routinised into standard operating procedure in the US by the 1920s at the latest.65
Thus, work study represents the one clear ‘victory’ for Americanisation of the early post-war period, and one strongly encouraged in the late 1940s.
The major channel of such encouragement, was, like so much in the area of productivity, the brainchild of Stafford Cripps. Whilst Minister of Aircraft Production during the War he had become an enthusiast for motion study, and set up a Production Efficiency Board in the Ministry to propagate this. Post-war, he had pressed for transforming this into a Production Efficiency Service (PES), offering free and general management consultation to small firms, but with a considerable dose of motion study.66
Cripps's enthusiasm was very much for motion study, that is ergonomics, which he wished to keep sharply separate from time study, a much more contentious technique involving questions about the pace of work and wage calculations. In part this division reflected the peculiar if explicable desire to keep separate ‘wage’ and ‘production’ issues, as discussed in Chapter 5. But whilst motion study was being encouraged by the PES in the late 1940s, time study was also spreading, basically as part of the growth of piece-rate systems, encouraged by the British Institute of Management as a good management practice.67
The SRU was less inhibited about linking the two elements, and made investigations of time and motion study in the context of its research into productivity. A report by the SRU argued plausibly that most advocacy of time and motion emphasised the motion/ergonomic aspect, but that most adoption of it occurred as a basis for wage payment systems. In its view the discussion of time and motion as a device for aiding productivity had been bedevilled by the linkage with pay bargaining, as this involved controversial issues about how far unions would accept a ‘scientific’ basis for wage setting to displace collective bargaining. Generally the SRU saw merit in time and motion, but regarded claims that it was a crucial and scientific technique to be overblown.68
Work study emerged strongly in the 1950s, partly as a result of the example of particular firms, notably ICI, and partly because of the growing enthusiasm for piece-work systems. Nevertheless, it was also linked to the productivity drive of the 1940s and to the idea of Americanisation. Carew treats the spread of work study as a key index of the success of Americanisation, in the sense that it secured the support of workers for American-style scientific management, aimed at the subordination of labour. This general thesis is considered in the conclusion below, but it is important to note that by itself, work study was rather less radical in its implications than Carew suggests, because so little else in the package of ‘scientific management’ had been adopted. Enthusiasm for work study in the 1950s did not herald a radical restructuring of work and production organisation, but was more of an ‘add-on’ to existing production systems. As Granick implies, it was therefore rather limited in its implications for British firms, rather akin to the take up of just-in-time systems by British firms in the 1980s and 1990s.69
The clear implication of this chapter, to conclude, is that the extent of ‘Americanisation’ of British industry in the early post-war years was very limited. Whilst the precise content of what Americanisation might mean is disputable, it is difficult to argue that any of the possible aspects connected with such a process — standardisation of components or products, standard costing and budgeting, ‘mass production’ techniques in general — went very far in this period. Work study was, at most, a very pale imitation of Tayloristic practices and its significance remained largely confined to wage bargaining procedures.
Given the scale of Government and other efforts which went into propaganda for Americanisation, this very limited impact requires some explanation. Central here is the fact that many British industrialists were sceptical about the relevance of the American model for British conditions. No doubt in part this stemmed from a common gut reaction to the American model. But there was also a reasoned case which more than one authority made. The Engineer, for example, the trade paper of the engineering industry, was far from vitriolically anti-American, yet on a number of occasions it questioned just how relevant the US example was for British industry. One editorial thus argued:
Britain, manufacturing for the world rather than for its home market alone, has to take into account … national tastes and likings. The consequence is that mass production methods cannot be so highly developed as in America, and output per worker is necessarily lower. Furthermore, many of the heavier engineering products of this country are made to special orders and designs, so that not even group productive methods are applicable.
On another occasion it pointed out that obsession with the American model had led to the neglect of the fact that, in many areas, Britain's competition came from Europe, not the USA: ‘Much of real value to the industries of this country would, we believe, be learnt from a study of plants in Western Europe, which are confronting problems much more similar to our own than are those facing American producers’. 70
Such scepticism was also evinced by some economists. Jewkes's view on cotton has already been noted, and he made similar points in a more general article in 1946. Another economist, G.C. Allen, expressed a parallel argument, though emphasising that he was not against learning from abroad. For Allen, the lesson was that ‘an uncritical acceptance of foreign types of organisation as the norm’ seemed ‘as foolish as insular complacency’.71
But if a case can be made for the logic of some resistance to Americanisation in the 1940s, this line of argument has its dangers. Thus, for neo-classical economists (and historians who follow them), it is all too likely to lead to a Panglossian view that whatever industrialists did was for the best. This is a little hard to accept even in relation to cotton, where the significance of ‘Americanisation’ can be seriously questioned, but it is all the more so in areas where the most obvious forms of such ‘Americanisation’ would appear to have been only too relevant. For example, it is hard to believe that the engineering firm able to produce 20,000 different types of bearing would not have benefited from a dose of the ‘3Ss’.72
The simple point is that ‘Americanisation’ was differentially applicable to industries in Britain. In some cases markets could have been exploited with standardised products, in other cases this might have been a problem. In particular, standardisation of components would seem to have offered a much more fertile field for economies of scale than standardisation of some final products. This is brought out quite strikingly in the contrast between the clear market limitations in the standardisation of diesel locomotives in Britain as opposed to the possibilities in valve manufacture.73 The important fact is how little this differential applicability was taken into account in the discussions — for example, it hardly seems to figure in FBI deliberations.
Finally, there is the question of ‘Americanisation’ in the more specific sense of work practices, and the idea that the AACP and other initiatives successfully sold an ideology of managerialism to the unions and the Labour Party in Britain, on the back of which ‘Tayloristic’ work practices were then introduced. It has already been suggested that work study, although undoubtedly popular in the 1950s, was a rather limited change in British industry. It was not a sign of ‘Taylorism’ being widely deployed. British resistance to Taylorism in the sense of systematic de-skilling, work fragmentation and machine-pacing of production seems to have remained strong. In part, this was because of the absence of the necessary parallel changes in product mix and production techniques.74
On an ideological plane, too, resistance to Taylorism was also significant. Carew is undoubtedly right in arguing that the AACP and Americanisation generally reinforced the spirit of ‘class compromise’ under the Labour Government. But this process surely had largely domestic roots, relating to the basics of Labour's electoral strategy, and can therefore be traced to the 1920s rather than the 1940s. Similarly with the trade unions, the acceptance of the productivity drive and its implications by union leaders was undoubtedly a striking feature of this period. But it seems much less clear that this owed much to American influence, as it fitted in with the whole union movement's conception of its role from, at least, 1941. So whilst Carew is right to suggest the importance of Marshall Aid for the political divisions in Western European Labour Movements in the late 1940s, it is much less apparent that it fundamentally affected the stance on economic and production issues that was taken by either the Government or the unions.