Thursday, March 15, 2012

Career Change

A couple of “whistle blowers” have been making the rounds recently, one from Goldman Sachs and one from Google, asserting that they quit their companies due to disgust with the manner in which those companies had changed policies. I can relate. As my profile says, I worked in the steel industry for many years, and changed to a career in landscaping. That change was for reasons not unrelated to the feelings expressed by these whistle blowers.

After working for 6 years on the floor of a steel plant as a member of the Teamsters union I moved the office and then, after several years, into plant management. I later formed my own company installing machinery in steel plants and remained in the steel industry until the mid 1980’s.

As production (sheer volume) and productivity (efficiency) increased in the 1960’s labor and management had a rather interesting relationship. Outwardly adversarial, it actually worked rather well since productivity gains were pretty much matched by wage gains and it remained a win/win situation. Along with that, as production needs increased the industry engaged in capital spending, procuring more and more modern equipment to sustain the faster production that was needed.

Then two things went bad. The industry reduced capital spending, merely working the existing equipment harder and at higher than design parameters to achieve more production and running it longer hours and often without proper maintenance. And for reasons of globalization and government regulation the unions lost their ability to assure that increases in productivity were matched by wage gains.

So now you have equipment running at speed it was not designed for, without the regular maintenance it needs, with operators who cannot keep up because their operations were designed for a slower speed line, and whose job satisfaction has been diminished by minimal or no pay increases for significantly increased workload.

For me, none of this was abstract. By 1977 I had become manager of a steel plant in Atlanta. Upper management was demanding that I run my equipment beyond it’s capacity. I would argue, telling them that a machine was rated at 14ga for instance and that using it for 12ga material would specifically damage it, and they would order me to use it for the 12ga material. I would tell them I needed to shut a line down for one day to perform maintenance because otherwise it would certainly produce product that was out of tolerance, and they would order me not to shut it down. As an inevitable result of management decisions, our defect rates were climbing and I was utterly unable to prevent that from happening.

I knew how to prevent that. I knew how to ship 300 tons/day out that door with zero or nearly zero defects, but management cost saving and/or output target decisions prevented me from doing that. That’s why I left to form my own company and later, as the steel industry foundered on the rocks of its own bad decisions, to become a landscaper.

1 comment:

bruce said...

Is that what happened to the auto industry as well? Also, I have read that the steel industry has a resurgance in later years (prob well after you had left it).

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