Management Information and Management Practice: A Freight Train Operation in Inter-War Britain Roy A. Edwards Department of Economic History, The London School of Economics Phd Dissertation UMI Number: U616001 All rights reserved INFORMATION TO ALL USERS The quality of this reproduction is dependent upon the quality of the copy submitted. In the unlikely event that the author did not send a complete manuscript and there are missing pages, these will be noted. Also, if material had to be removed, a note will indicate the deletion. Dissertation Publishing UMI U616001 Published by ProQuest LLC 2014. Copyright in the Dissertation held by the Author. Microform Edition © ProQuest LLC. All rights reserved. This work is protected against unauthorized copying under Title 17, United States Code. ProQuest LLC 789 East Eisenhower Parkway P.O. Box 1346 Ann Arbor, Ml 48106-1346 I Hr££ £ S F 7382. POLITICAL tOMl C & ACKNOWLEDGEMENTS A thesis always involves contributions and support from family and friends, as well as colleagues. It was my good fortune that in the writing of the thesis, colleagues became friends. In particular, my supervisor Dudley Baines provided insights both into railway operation and analysis. Mary Morgan as my second supervisor provided a critical review of early drafts which both built confidence and demolished long cherished ideas. To them both I owe a great deal. In my more desperate moments, Linda Sampson provided an insight into the correct use of Word Perfect and prevented, or at least ameliorated, a complete loss of mental faculties as the submission date drew near. I am also greatful to Rajiv Ball who helped in the final preparations for submission. The Rees Jefferys Road Fund Scholarship, awarded by the LSE, provided two years worth of funding, for which I am grateful. When the pressure of work became too much, a number of friends aided and abetted recuperation: I will be forever in the debt of Graham Collis, David Turner, Ian Claus and the ’Addicks. However, this thesis would have been IMPOSSIBLE without the support and encouragement, both financial and moral of my mother Eunice Edwards. It is to her and my late father, Douglas Edwards, that this is dedicated. ABSTRACT This thesis seeks to explore how management practices developed in the U.K. using three of the big four railway companies as case studies. It will be argued that the managers in the UK, whilst aware of the debates on "Systematic" management and US practices, pioneered their own approach. Many of these practices were begun before amalgamation in 1923, but were only fully developed afterwards. We begin by exploring the history of management with an outline in Chapter Two on management ideas from the turn of the 20th century to 1939. This is followed by an analysis of management practices from circa 1900 to the amalgamation of 1923 in Chapter Three. Chapter Four introduces the railway companies within the context of their commercial environment. Chapter Five addresses the problem of achieving control of conveyance operations was addressed using similar methods by all companies. The key difference lay in the extent to which techniques were applied: the LMS developed centralised Train Control which enabled a systematic analysis of information to be made. The GWR and LNER introduced localised Traffic Control which did not allow such systematic analysis. In Chapter Six we see how the LMS employed management consultants to study terminal work using Time and Motion studies. Both the GWR and LNER emulated LMS practice by 1939. However these techniques were not the only solution. The LMS identified particular problems after amalgamation which it was felt could be solved by such analysis. The GWR on the other had concentrated on the transhipment freight, with encouraging results. Chapter Seven examines how railways perceived and interacted with their external business environment. New services were offered on the basis of research directed at identifying customers and the services they required. Agents of all companies would investigate opportunities for business and advise customers on their best options. The LMS and GWR had sophisticated Research Departments dedicated to the collection of commercial and economic information regarding the traffic available. If we take the essence of what these were trying to achieve: a rational and scientific approach to management problems, then the railway companies appear in a favourable light. Whatever criticisms are made of the railways, it was not a failure to adopt new management methods. TABLE OF CONTENTS Chapter One The Analysis of Management Practices A Model of Management Control p4 The Business of Transportation p5 The Development of British Management p8 Early Management Practices p 10 Management Information and the Firm in the United States pl4 Chapter Two The Development of Management Practices The Scientific Approach to Management p29 Management Control p33 Management Control and the Planning Process p34 Management Control and Standardisation p36 Monitoring: Execution and Evaluation p39 Systematic Management In the Office p41 Collecting Information: The Form p43 Collating Information: The Report p46 Chapter Three Railways and Management Early Railway Management p49 The Debate on Management p53 The Ton Mile and the Departmental Committee p55 Train Control p63 The Lancashire and Yorkshire p70 The North Eastern Railway p71 The Reformers' Response p72 Terminal Services p74 Chapter Four The Post Amalgamation Railway Companies The 1921 Railway Act, Amalgamation and its Legacy p79 The Inter-War Business Environment p82 Organisational Structure and Business Information p94 The LMS and Organisation Reform p95 The GWR: Continuity without Change p98 The LNER: Area and District p99 Relating Revenue to Expenditure p i00 The LMS Goods Conference p i00 The GWR Goods Conference pi 02 The LNER Goods and Mineral Managers Conference pl04 A Summary of Railway Performance pl05 Chapter Five The Conveyance of Traffic and Management Control Centralised Train Control: The LMS pill The Trains Office p 115 Decentralised Train Control: The LNER pl21 Information and Display on the LNER p 125 The GWR: Ad Hoc Control? pl27 Control in Action: Rolling Stock Distribution p 131 Centralised Rolling Stock Distribution an the LMS p 132 Departmental Wagon Control on the LNER p i34 Decentralised Rolling Stock Control: the GWR p i37 Chapter Six The Control of Throughput: Managing Terminal Operations Terminal Work p i44 Time and Motion Studies p i49 Time and Motion: Ord's Report p 151 Time and Motion: The Results pi 56 The Executive Research Office and Terminal Mechanisation p i62 Terminal Working: The LNER p i64 Terminal Working: The GWR p i67 Transhipment pi 70 Chapter Seven Managing Commercial Policy Setting Railway Rates: Traffic Costing p 178 Railway Pricing: The General Railway Classification p i82 The Basis for Pricing: the Standard Rate p i85 The Basis for Pricing: Deviations from the Standard Rate p i85 Commercial Research p 18 9 The GWR Traffic Research Committees' p 190 Commercial Development and Area Research on the LMS p i94 The LNER: Statement of Trade in Area pi 97 The Railway Research Service p i99 The Railway Clearing House p200 The RCH Rates Conference p201 The RCH Goods Managers' Meetings p203 Road Competition p205 Responses to Competition: Road Services p210 Responses to Competition: Railhead Distribution p212 Responses to Competition: Containers p215 The RCH and the Marketing of the Container p217 Chapter Eight Conclusion TABLES AND ILLUSTRATIONS Chapter One Figure 1 A Model of Management Control p3 Chapter Three Figure 1 MR Train Control Diagram p65 Figure 2 MR Results of Train Control Chart p68 Chapter Four Table 1 Number of Goods Vehicles Licensed p83 Table 2 Traffic Lost to Road Transport p83 Table 3 GWR Percentage of Traffic p85 Table 4 LMS Percentage of Traffic p85 Table 5 LNER Percentage of Traffic p85 i Table 6 Heavy Industry Output p87 Table 7 Coal, Iron and Steel p88 Table 8 New Traffic p89 Chart 1 The GWR Organisational Diagram p91 Chart 2 The LNER Organisational Diagram p92 Chart 3 The LMS Organisational Diagram p93 Chapter Six Table 1 Train Loading pl46 Table 2 Mechanisation of Goods Sheds pl53 Figure 1 LMS Goods Shed Design pl57 Table 3 Visit of LNER (Southern Area) pl58 Figure 2 GWR Transhipment Diagram p!71 ABBREVIATIONS C&D...................................................... Collection and Delivery GCR...................................................... Great Central Railway GWR......................................................Great Western Railway L&YR.................................................... Lancashire and Yorkshire Railway LMS....................................................... London Midland and Scottish Railway LNER..................................................... London and North Eastern Railway L&NWR................................................ London & North Western Railway MR......................................................... Midland Railway NER......................................................... North Eastern Railway RCH.........................................................Railway Clearing House RRT......................................................... Railway Rates Tribunal S to S...................................................... Station to Station Chapter One The Analysis of Management Practices The role of management in generating competitive advantage is not often addressed explicitly. Relatively little is known about how management methods