The New Stakhanovites

Nearly everyone in business talks about improving productivity, but notable breakthroughs are rare. Last year productivity in U.S. manufacturing rose 4% v. 5.8% in 1971. Lately the workers at Kaiser Steel Corp.'s continuous-weld pipe mill at Fontana, Calif., have shown that dramatic gains can be made with only minor changes in methods and machines. In the last three months of 1972 they raised their productivity by a herculean 32%.

The new Stakhanovites* had a powerful incentive. Last October Kaiser officials announced that the 4,000-ton-a-month plant was being shut down, a victim of rising costs and stiffening foreign competition; a ton of two-inch Fontana pipe that sold for $300 was being offered by Japanese mills for $240. Recalls Dino Papavero, president of United Steelworkers Local 2869: "We asked management to give us a chance to make the mill pay."

Kaiser executives agreed to postpone the closing and adopt a few worker suggestions. A traveling saw that cut pipe into sections after it left the furnace was repaired and overhauled at a cost of only $3,000. Workers had been asking for the adjustments for years; once they were made, spoilage dropped from 29% of output to 9%. In addition, a few storage racks and inspection tables were rearranged to permit a smoother flow of work. Two crucial but low-paid employees who operated a pipe straightening machine were given raises from $3.70 to $4.07 an hour. And the workers made a relatively minor change in their production schedule to prevent some machines lying idle while different sizes of pipe were being processed on others.

New Spirit. The plant's maintenance staff began repairing in a day breakdowns that formerly took a week to fix. Operators of straightening and threading machines began catching mistakes that they had previously let pass. "There is a new spirit in the mill," says Assistant Works Manager Ray Robinson. Observes the union's Papavero: "Being recognized as people who can make creative suggestions has given the men a certain dignity."

Still, the successful experiment may fail to keep the plant open. Because labor accounts for only one-ninth of the cost of making Fontana pipe, increased productivity has trimmed the price of the finished product by only some $11 a ton. "That isn't the $60 it would take to match Japan's price," says Robinson. Kaiser executives refuse to disclose when a final decision will be made on the mill's fate. For the moment, Fontana workers are hustling and hoping on a day-to-day basis.

*After Aleksei Stakhanov. a coal miner who became an early hero of Soviet labor by greatly overfulfilling his production quota.

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