RATIONALISATION

Auckland Star, Volume LXI, Issue 164, 14 July 1930, Page 19

RATIONALISATION

N.Z. INDUSTRY'S NEED. PUTTING HOUSE IN ORDER. PREVENTION OF WASTE. Industrial rationalisation, meaning {he rational organisation of production a nd distribution applied to entire industries or national economy, was the subject chosen by Dr. E. Marsdeu, secretary of the Department of Scientific and Industrial Research, in an address jn Wellington. Discussion on 'the eub- ' iect, lie said, seemed to lie highly necessary, as the economic progress of the United States was threatening difficulty to the Empire. Tie World Economic Conference at Geneva. 1927, lie said, defined rationalisation as "the methods of technique and organisation designed to secure the minimum Waste of either effort or material." It included: (1) The scientific organisation of labour; and (2) the standardisation of both raw materials and products, simplification of processes and improvements in the system of transport and marketing. Opportunity for Unions.

Rationalisation should not be the competition of organised capital against labour or labour unions. Indeed, in rationalisation, a trade union may well ji'iid a magnificent opportunity of seeing how legitimate are its aspirations to take part in the development and prosperity of industry. The scientific organisation of labour, for success, must involve plenteous and stable labour conditions, with men -well paid, and with non-fatiguing labour.

Rationalisation presupposed a great intellectual effort on the part of the brains of an industry, the central offices and the research department. Nothing was more characteristic of modern business and industry than the way in which control based on power and ownership was giving place to authority based on knowledge, qualification, and skill; and the greatest of all needs in industry was leadership.

Quotin" as examples the cotton and woollen industries in Great Britain Dr. iJiiarsden pointed out that here we had a multitude of small factories distributed among many small towns, each v-ith its management and sales organisation separate. "The various operations of turning cotton or wool into cloth were further subdivided into separate factories. These conditions had-grown up at a time when industrialism was at the source of power, i.e., coal, and far from tie source of raw supplies. To-day conditions were changed, and if these industries were to commence de novo the present organisation would not be considered the most efficient. , Conditions in Dominion. After quoting American examples of rational organisation in industry, Dr. Marsden turned to conditions m New Zealand. "Can anyone say," he asked, "that our transportation systems are sufficiently rationalised, when seed bailey purchased on the farm m Oamaru at 3/6 sells on the pig farm in the-Waikato at 7/? Take , the mining industry. We are importing coal when do industry in New Zealand need use other 1 than local coal, one of the mam factors being the organisation of the industry, which could be made a dependable, stable industry, instead of an irre<mlarlv functioning one. For example, at Ohai, 6n the southern coalfield, there are four main niinee bringing up their coals to one main point, with' four separate organisations, four separate sets of screens, bins, etc., four sets of offices and selling organisations, for prac tically the same class of coal; and the same duplication is repeated in other mines. Moreover, all of these multitudinous organisations lead to national waste, in that in the effort to mine cheaply under this irrational organisation, only the easily-obtained coal is mined, and far too much is left in the mines, lost to us for ever. "It is true that there are some efforts towards rationalisation, as, for instance, the Waikato slack pool is an example of horizontal combination, and, as an example of vertical combination, the ownership of a mine by t/e New Zealand Co-operative Dairy Company for the production of coal for their own purposes.

Woollen Industry. "Take the woollen industry. This industry is capable of a much larger output for local consumption apart from possible development into an export industry, because of its ready connection with certain types of raw material. "A multitude of factories, each with a multitude of products, cannot be eaid to be rationally organised, I agree that combination as* a step towards rationalisation may involve the consolidation of some small relatively initial business on economic terms, and a merger would lave high interest to pay on nonprodttcin<r units; but this would be largely compensated by more increased economic production. Moreover, a rationalised industry could maintain a live research or technical department — in my opinion, essential Tinder the changing conditions of utilisation of products and essential if we are to develop against foreign competition in lines suitable for export.

/'Similarly, take the boot manufacturing industry,~or the tanning industry; in the latter case the industry has obtained many of the benefits of consolidation by forming a research association. The etandard of leather produced has been raised, as has also the efficiency of production, and the industry has derived much benefit from improved co-operation between tanners and consumers."

;, Standards." . %• Marsden then dealt with rationalisation ' ae'applied to New Zealand's ,'primary industries. Having indicated how one of the principles of rationalisation, the standardisation of raw material a nd finished product, is unconsciously taking hold of our industrial system, he concluded: "To rationally grip the various aspects we must think in standards—standard grasses, standards ,of production of animals, standard butter, meat, cheeee, and wool, standard foodf™n*s; and while these have a direct bearing on production their influence in Marketing is even more pronounced. . "Can_we i oo k at the details of our industrial organisation in terms of rationalisation and standardisation, or i≤ ™>s point of view abhorrent to human which often instinctively pr.efers * gamble to steadily ordered progress? New Zealand public always have °wn a spirit of progressive readiness ohtv Up new metii ods and ideas and t" m them the maximum utilisa- { "• *? the long run it is the human *«or that Xothing can integrate lead V° re thau bold ' en ter P risiD S