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BELL SYSTEM TECHNICAL JOURNAL 



carried on under commercial conditions. As the black sectors in the 

 pie charts decrease in size, indicating progress in the removal of as- 

 signable causes, we find simultaneously a decrease in the average frac- 



RAW MATERIAL 



INSPECTION 



TO REDUCE COST 



OF PRODUCTION 



PARTS 



PARTS 



too <Vb INSPECTION 



TO 



PROTECT CONSUMER 



PARTIAL ASSEMBLIES 



FINISHED PRODUCT 



GOOD 



UNITS 



Ro] TELEPHONE 



AND 

 LINE 



Fig. 12 — An economic production scheme. 



tion defective from .014 to .008. Here we see how control works to 

 reduce the amount of defective material. However, this is such an 

 important point that it is perhaps interesting to consider an illustration 

 from outside the telephone field. 



Recent work of the Food Research Institute of Stanford University 

 shows that the loss from stale bread constitutes an important item of 

 cost for a great number of wholesale as well as some retail bakeries. 

 They estimate that this factor alone costs people of the United States 

 millions of dollars per year. The sales manager of every baking cor- 



