312 APPENDIX. 



management was generally on a par with their facility in pro- 

 curing supplies. 



But in seeking better methods where the permanent personal 

 responsibility of profit tends to whittle off excrescences of 

 administration which lead to wasteful delay, I found that much 

 had been sacrificed to immediate advantage ; that records were 

 too often kept by memory, so that, as the manager of an estab- 

 lishment employing 1,400 men once told me, "The trouble is, 

 not in foreseeing necessities, nor in starting the work to meet 

 them, but in constantly running over the back track to see that 

 nothing ordered had been overlooked, and in settling disputes 

 as to whether such and such an order was or was not actually 

 given and received. Superintendence," said he, " would be 

 very different work if I were sure that an order once given 

 would go of itself through the works, leaving a permanent trail 

 by which I could follow it and decide positively where and 

 by whom it was stopped. As it is, I spend so much of my 

 time in ' shooing ' along my orders like a flock of sheep, that I 

 have but little left for the serious duties of my position." 



These were familiar words, and when I went further down, 

 and saw how much foremen's time and memories were taxed for 

 means of attending at once and finally to their daily wants, I 

 became convinced that the government methods, though bad 

 enough, were not the only ones to be criticised. 



In the matter of costs, too, I found great uncertainty. I 

 found one business which had been exposed to expensive litiga- 

 tion, involving $6,000,000, to determine what was the true cost 

 of machinery sold by its agents at a commission based upon its 

 cost of production. I found another entire trade based upon 

 costs determined, as one of its members writes me, by "thumb- 

 sailing," large establishments suffering from the competition of 

 ignorant free lances, who, in ruining themselves, also injured 

 their neighbors. 



II. 



The proposed system of shop accounts is based on two com- 

 pensating principles. 



I. The radiating from a central source, let us say the office, of 



