ORGANISATION OF INDUSTRY

Hokitika Guardian, 1 July 1929, Page 2

ORGANISATION OF INDUSTRY

PROFESSOR TOCKER’S . , ADDRESS. < . CHRISTCHURCH, June 28. Professor A. H. Tocker, who occupies the chair of Economics at Canterbury College, addressed members of the Canterbury Advertising Club at their luncheon yesterday. His subject was “Rationalisation” . a comprehensive term covering recent developments in ’the more rational organisation of. industry;*l Rationalisation as a modern movement, said the speaker, aiming at organising industry for the best output'.at the lowest cost. It included many of the advantages of mass production. The changes which led up to it were to be found in the Great War which meant the loss of overseas trade to Britain and other European countries, since, while European manufacurers were more or less out of action textile industries were developing in America and Japan. Upon this change in the markets there came also a change in demand. Oil and electricity took the place of coal. Consumption of many textiles fell away and the demand for others grew. At least £15,000,000 was spent every year on motor transport in New Zealand which meant that the amount was not being spent on other products. When the depressed countries looked for fresh markets after the war, they found competition was strong, and they had to reduce prices. To do this they had to attend to the internal organisation for thqir industries leading to a search for a more rational basis of organisation. Industries grew up much like Topsy —they just grew, very often piecemeal and disrelated, in a higgledypiggledy way. The layout of factories was frequently hopeless. There were hundreds of small factories which produced small outputs of a great variety of goods—an uneconomical style, ?ince it needed much more plant and labour than would a rationally organised industry. There followed the formation of combines and trusts. Although a big trust or combine made big profits, it did not make them out of exploitation of consumers, but from the benefits of large scale production. Very much more exploitation resulted from small scale production and over-competition. Combination cut out waste in market-, ing.

The next step as to get down to the problems of production by means of simplification, standardisation aihd investigate certiain (industries (they found, for instance, that many more varieties of shovels were turned out than were needed for all purposes. In America the varieties of range boilers were reduced by 90 per cent, and eighty varieties of hospital beds were reduced to one. The reduced

number of articles -was next agreed on, stamjarised and maue' interchangeable. This meant less expense in replacement and repairs as far as- customers were concerned as well as reduced cost of plant, of maintenance, of testing and inspection, of technical staffs, storage space and capital locked .up. The demand for wire rope in Christchurch was comparatively small, but there was enough in store to supply the whole needs of the Suth Island for the next ten years

The next step was specialisation, through organising a group of manufacturing businesses and setting each lo specialise in the production of a single material. Organisations of this type were developing all rover the world, such as Sir Alfred Mohd’s merger in international chemical production. The cotton manufacturers of Lancashire were at present discussing a plan for reorganising their whole industry on this basis. Such a combine aimed to make better profits by giving better service and stabilising its market.

Consumers had little to fear from monopolisation. Their greatest protection was that manufacturers realised that cheaper goods were the best means of keeping their markets.

There was room fqv this rationalisation of industry in New Zealand. Trade associations could direct their attention to organising their business in more efficient ways of production, for they were at present heavily over capitalised. Professor Toclcer was accorded a hearty vote of thanks . /