Most persons display a like instinctive tendency to make collections and hoard articles. This is particularly apparent in collections of such things as canceled postage stamps, discarded buttons, pebbles, sticks, magazines, and other non-useful articles.

When this hoarding instinct is not controlled by reason or checked by other interests, we have the miser. In a less degree, we all share with the miser his hoarding instinct. We all like to collect money just as the squirrel likes to gather nuts. The octogenarian continues to collect money with unabated zeal, even though he be childless. He is probably not aware that he is collecting merely for the pleasure of collecting.

_Since the wage is the means ordinarily employed to awaken in workers the three instincts_

_of self-preservation, of social distinction, and of hoarding, it is not strange that an industrial age should regard it as the chief means of increasing efficiency_.

The employer has not attempted to discover what instincts were appealed to by the wage, or the most economical method of stimulating these instincts. He has not undervalued the wage in securing efficiency, but rather has assumed that the service secured must be in direct proportion to the amount expended.

Such an assumption is not warranted. Of two employers with equal forces and payrolls one may receive much more and better service than the other. It is not a question merely of how much is spent but how wisely it is spent. The wage secures service to the degree in which it awakens these fundamental instincts under consideration.

It is apparent, therefore, that other factors than the amount of money expended in wages are to be considered by every employer. Without increasing the pay roll he may increase the efficiency of his men. The employer who has

determined the number of men he needs and the wages he must pay has only begun to solve his labor problem.

In the preparation of the present chapter a large number of business men were interviewed personally or by correspondence.

One of the questions asked was: ``How do you make the most of the wages paid your men?''

As subsidiary to this general question three other questions were asked: ``In paying them do you base the amount to be received by each man upon a fixed salary? By some of the men upon actual output--commissions or piecework rates? By some upon a combination including profit-sharing or bonus?''

The answers to these latter questions were not uniform even among employers engaged apparently in the same business and under very similar conditions. Some reported that all the methods suggested were used in their establishment. Factory hands were employed on piecework or on a premium or bonus basis where conditions permitted; office assistants

on fixed salaries; department managers upon a combination including profit sharing. The results reported, however, were far from uniform. The astounding feature was the diversity of opinion among successful managers of employees. By various houses one or more of the systems had been tried under apparently favorable conditions and had been discarded. On the other hand each of the systems was advocated by equally successful business firms.

In judging of the relative merits of fixed salaries as compared with other methods the experiences of individual firms offer no certain data. The relative merits and demerits are best disclosed by a psychological analysis of the manner in which the various devices appeal to the employee's instincts and reason.

_When wages are based on commission, piece rate, or a bonus or premium system, the stimulus to action is constantly present. Every stroke of the hammer, every sale made, every figure added, increases the wage. The wage thus continuously beckons the worker to greater accomplishment_.

All other considerations lose in importance, and the mind becomes focused on output. The worker is blinded to all other motives, and invariably sacrifices quality unless this be guarded by rigid inspection.

Increasing Efficiency in Business Page 36

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