company culture. The directors of Thomas Firth and Sons recognised that given the shifts in the business environment and, in particular, the low purchasing power of world markets, there was "a temptation to try to produce at a lower price by reducing quality.”46 However, because their firm had "always taken a pride in the quality of the goods supplied and the service rendered to customers", the directors dismissed competition on the basis of price as unworkable, given the "traditions" or cultural proclivities of the firm. Thus, as Scholz argues, "the process of strategy formulation does not only have to consider the capabilities of the company and the market situation, but also the restrictions which derive from the existent corporate culture...(and) The stronger the corporate culture the more it limits the feasible space for strategy decisions."47 For example, Edgar Allen's directors emphasised that "In the past our business has been built upon the quality of our products and we think that it will apply even more strongly in the future....It is doubtful whether it would be possible for us to compete against overseas manufacturers in cheap products as ...their machinery has been adapted to these ends...while we can produce the same steels we cannot produce them so cheaply because our plant has not been designed for that purpose."48 Thus, Edgar Allen's machinery, an artefact of its culture, constrained strategic change and, moreover, the directors believed that their employees were so committed to product quality that they would "rather go where they could use their skill to the utmost than be compelled to do shoddy work."49 The directors of both firms therefore considered that they were bound by their culture which, in consequence, shaped their business strategy between the wars.
This strategy continued to be based upon the production of a wide range of high-quality steels, and steel products which were tailored to exacting customer requirements, using skilled and flexible labour. The directors considered that the advantage of this strategy 46 The Bombshell, vol. 12, no. 12, (Dec. 1928), p.454.
47J. G. Gonyea & O. M. Westall, '"Make Business Culture a Family Affair", Works Study, vol.43, (Sept/Oct. 1994), pp.9-10; Nelson and Winter have argued that the formulation o f business strategy “reflects at any moment...the historically given routines governing the actions o f a business firm...(and that)...firms are bound by precedent”, cited in S. Zukin, "Introduction", S. Zukin & P. Dimaggio (eds.),
Structures o f Capital: The social Organisation o f the Economy (Cambridge, 1990), p.6. In other words, as Zukin phrases it, economic decision-making is “culturally embedded”, that is “shared collective understandings" will shape business strategies and business goals, Zukin, "Intro.", p. 17. This means that the "same demographic, economic and social trends will be differentially noticed, interpreted and acted upon by individual companies", Gonyea, "Business Culture a Family Affair", pp.9-10; thus, as Casson points out, “it is the perception as well as the reality o f environmental change that is important...(and) ...Solutions are subjective because of...the model or mental map used.” Company culture, “a collective subjectivity, a shared set o f values norms and beliefs” will influence “the meanings that key executives or decision-makers attribute to changes in their business environment and the linkages they draw between these changes and the development and survival o f their firm”, M. Casson, "Entrepreneurship and Business Culture", in J. Brown and M. B. Rose, Entrepreneurship, Networks and Modern Business
(Manchester, 1993), p.34; Gonyea, "Business Culture a Family Affair", pp.9-10.
48Edgar Allen Works and Sports Magazine, no.60, (Sept. 1925), p. 12; no.95, (Aug. 1928), p.2.
was that "it reduced the field of competition...as they could produce products which...bulk manufacturers could not find time to handle."50 However, they recognised that to be successful, they must be capable of switching form one market niche to another, and they therefore remained committed to flexible specialisation. Edgar Allen's, for example, acknowledged that "Our Engineers Department...realises perfectly well that there must come a time when the productive capacity of cement plants all over the world will equal the demand...and as the market for this type of machinery approaches saturation point, it will have to...switch over to some other specialised line."51
Of crucial importance to this strategy however, was the development of a range of specialist steels which could be tailored to diverse needs. In particular, Firth's built upon its invention of stainless-steels, developing a bewildering variety of heat- and corrosion-resistant alloys, which were marketed under the brand-name 'staybrite'.52 Firth's and Edgar Allen's research laboratories were therefore even more important to their business strategy after World War One than before.53 Nevertheless, Firth's considered that research into specialist steels alone would not suffice in a hostile business environment, and it therefore sought to forge closer links with John Brown's. In 1930, their steel interests were finally amalgamated to form a new company, Thomas Firth and John Brown Ltd. 54 This amalgamation was accompanied by a rationalisation programme which resulted in the closing down of inefficient shops, and the installation of the largest electric arc furnace in Europe and the largest high- frequency induction furnace in Britain. This latter furnace, pioneered by Edgar Allen's in 1927, produced steels that were free from impurities and homogeneous throughout, and it was therefore ideally suited to the manufacture of specialist alloys.55 Of course, Firth's and Edgar Allen's technological strategy was not unusual - product quality was a core-value of the industrial district. Most manufacturers considered that product quality was their "sheet anchor" and the one thing they must never give up. This encouraged them to install high-frequency furnaces and manufacture top quality
50Edgar Allen Works and Sports Magazine, no.95, (Aug. 1928), p. 1. 51 Ibid., no.98, (November 1928), p.2.
52 The Development o f Staybrite Steel (Sheffield, 1930), pp. 1-4. Tweedale, "Science, Innovation and the Rule-of-Thumb: the Development o f British Metallurgy to 1945", in J. Liebenhau (eds.), The Challenge o f New Technology: Innovation in British Business Since 1850 (Aldershot, 1988), p.74; Edgar Allen heat- resistant steels were marketed as 'Maxhete', Edgar Allen Trade Catalogue (Sheffield, 1934), p.23. 53 The Brown-Firth Research Laboratories, (Sheffield, 1938), p.6; Edgar Allen Works and Sports Magazine, no.29, (Feb. 1923), p.26.
54 Souvenir o f a Visit to Firth-Brown Ltd., March 14th 1957 (Sheffield, 1957), p.47.
55 The Bombshell, vol.15, no.4, (April 1931), p. 123; Firth-Brown Souvenir, 1957, pp.51-54; G. Tweedale, Steel City, Entrepreneurship, Strategy and Technology (Cambridge, 1995), p.253; Edgar Allen News, vol.6, no.68, (Jan. 1928), p.99.
stainless steels.56 However, in their continuing commitment to education and training, Firth's and Edgar Allen's were quite unique. Indeed, in what follows it will be argued that policies of education and training, were not only integral to the business strategy of these firms, but that, along with other industrial welfare measures, they were also used by the management as a tool to recapture the loyalty and trust of the workforce, which had finally broken down during World War One.
In chapter 4, it was argued that the 'social glue' which held firms such as Firth's and Edgar Allen's together was the reciprocal relationship between management and workers, based upon notions of loyalty, trust and obligation.57 During the early 1920s, both these firms experienced unprecedented labour troubles, which suggests that this 'glue' was coming unstuck. The directors of both companies recognised that the rapid expansion of their business activities during the war had undermined their personal relationship with the workers and, in particular, it had rendered "one to one verbal communication", which chapter 4 identified as a key mechanism for the development of trust, extremely difficult.58 Firth's chairman for example expressed his regret that: "during the war the number of employees had increased so rapidly and the duties of direction had become so much greater, that the personal relationship previously existing between the management and the employees had unavoidably suffered...."59 Indeed, as the firm grew developing various departments and functions, it culture began to lose the homogeneity of the founder period, which was explored in chapter 4. In particular, there developed a clear sub-culture based upon a nascent shop steward's movement, known as the Firth Workers' Committee. In view of this sub- or counter-culture, the management recognised that "more and more conscious thought and direction was needed, in keeping alive confidence between employees and a more aloof management...to promote a feeling of common endeavour."60 Thus, in terms of the metaphor of culture as 'social glue', in a larger, more functionally oriented company, the glue required more careful maintenance and repair work.
56Quality was a core-value o f the business culture o f the industrial district, thus, the Sheffield Chamber o f Commerce emphasised that "for generations, the name o f our city had been associated...with production o f the highest quality o f material and craftsmanship on which the reputation o f our industry has been built up", Quality, v o l.l, n o.l, (Oct. 1929), p.l; vol.3, no.7, (April 1932), p. 16; vol.3, no.6, (March 1932), p .l. 57For a discussion o f culture as 'social glue', see chapter 1 o f this thesis and M. Alvesson, Cultural Perspectives on Organisations (Cambridge, 1993), p. 19.
58 The Bombshell, vol.3, no.3, (March 1919), p.91; Edgar Allen's directors claimed that during the war the works had grown so large that their personal relationship with the workers was beginning to break down, Edgar Allen Works and Sports Magazine, n o.l, (June 1920), p.23.
59 The Bombshell, vol.3, no.l, (Jan. 1919), p.l 1.
60 Cited in H. Jones, "Employers' Welfare Schemes and Industrial Relations in Inter-War Britain",
In order to promote the feeling of a common endeavour, and to foster a company culture based upon reciprocal loyalty, both Firth's and Edgar Allen's looked to their company journals, The Bombshell (established 1916) and The Edgar Allen’s Works and Sports Magazine (established 1920) as a means by which they could communicate with their workers and maintain a personal relationship with them.61 The case-studies lend support to Alvesson's argument, that it is possible to be, at the same time, constrained by culture and yet attempt to manage it.62 In other words, the directors of both companies were bound by the core-value of product quality, which circumscribed the scope for strategy formulation, but nevertheless, they attempted to maintain and nurture the loyalty and trust of the workforce.
Both journals stressed the importance of the human element in industry. Edgar Allen's magazine for example, identified "skilled and educated workers" as a "definite business asset."63 In addition, they promoted the ideology that the interests of employers and employees were identical, and that they should work together in order to combat foreign competition. We are back therefore, to the assumption discussed in chapter 4, that human relationships should be characterised by co-operation. Indeed, a typical passage in the Bombshell claimed that "All Firth's workers must pull together....Whatever our position, whether as director, clerk or workmen, we all have our part to play, and can either help or hinder the running of the industrial machine."64 Nevertheless, at Firth's in particular, the management were not the only ones attempting to project their ideology in order to capture the hearts and minds of the workers. The Firth Workers' Committee, for example, published its own magazine, The Firth Worker, expressly as "an antidote to the one issued by the firm."65 It argued that the interests of capital and labour were diametrically opposed and characterised by conflict.66 It sought to undermine the assumption of co-operation between workers and management, and it encouraged Firth's employees to take "a much wider outlook on industrial matters than the four walls of the firm."67 In other words, it claimed that the
61 The Bombshell, vol.3, no. 1, (Jan. 1919), p. 11; Edgar Allen Works and Sports magazine, no. 1, (June 1920), p.23; Firth's use o f The Bombshell was identical to the use that Lever Brothers made o f their magazine, which, as J. Griffiths has pointed out, "figured as an important medium to communicate with the Lever Brothers workforce", J. Griffiths, "Give My Regards to Uncle Billy: The Rites and Rituals o f Company Life at Lever Brothers, c. 1900-1990", Business History, vol.37, no.4, (Oct. 1995), p.28. 62Alvesson, Cultural perspectives, p.90.
63 The Bombshell, vol.3, no.3, (March 1919), p.95; Edgar Allen News, vol. 11, no.126, (Nov. 1932), p. 167; according to Helen Jones the emphasis on the human element in industry acted as an antidote to the growth o f the firm, Jones, "Welfare Schemes", p.72.
64 The Bombshell, vol.3, no.3, (March 1919), p.95; Edgar Allen Works and Sports Magazine, no.2, (July 1920), p.21.
65 The Firth Worker, no. 16, (1917), p.9. 66 Ibid., no. 14, (1917), p.2.
workers' interests lay with workers at other firms and attempted to undermine the old notion of the firm as an organic and harmonious whole, and in order to drive its message home, it parodied certain of The Bombshell's monthly features, for example, "Is It A Fact": "Is it a fact that the firm again showed their love for workers by summoning a discharged soldier for losing time." 68
In order to counteract the messages transmitted by The Worker, the directors embarked upon a concerted campaign of cultural intervention. It is, for example, no coincidence that Firth's official history was written in 1924. In terms of the metaphor of culture as 'clan', this history, excerpts of which were printed in The Bombshell, can be viewed as a means of "providing members with the intellectual tools and a long memory which guarantee the perception and evaluation of fair reward and which over the long-run discourage opportunistic behaviour."69 Nevertheless, if the directors were to overcome the challenge of the Firth Workers Committee, something more than words was required.
Various studies of industrial welfare have suggested that the primary aim of welfare schemes was the development of an efficient workforce. That is, a workforce which was disciplined, healthy and trained to whatever degree of skill was required.70 In what follows, it will be argued that both Firth's and Edgar Allen's used welfare to achieve all three ends, and a particular accent was placed on acquiring discipline through the promotion of an ideology of reciprocal loyalty and obligation, in which management acted to inspire the loyalty which they demanded. Through the medium of their works magazine for example, Edgar Allen’s directors informed the workers that "We believe...that we have certain duties to our employees. One of these is to ensure they are given facilities for healthy recreation which will improve their physical constitution."71 Workers provided with such facilities were, in turn, expected to be loyal to the goals of the firm. Thus, The Bombshell urged workers that "if a man pays you wages which provide your bread and butter, work for him; if besides he treats you well, speak well of him, stand by him and the firm he represents."72 Both firms
68 Ibid., no.8, (1917), p.2.
69This history contained organisational stories, which reveal and promote the managerial ideology, and role-models for the workers to follow. For a discussion o f culture as 'clan', see chapter one o f this thesis and Alvesson, Cultural Perspectives, p. 18. O f course Firth's and Edgar Allen's problems were part o f the general worsening o f labour relations in British industry in the early 1920s, leading up to the General Strike o f 1926.
70H. F. Gospel "Managerial Structures and Strategies: An Introduction", in H. F. Gospel and C. R. Littler (eds.), M anagerial Strategies and Industrial Relations (London, 1983), p. 14 ; J. Melling, "Employers, Industrial Welfare and the Struggle for Workplace Control in British Industry, 1880-1920", in Gospel & Littler (eds.), Managerial Strategies, pp.57-8 . H. Jones, "Employers Welfare Schemes", pp.61-75.
71 Edgar Allen Works and Sports Magazine, no.83, (Sept. 1927), p.28. 72 The Bombshell, vol.4, no.8, (Aug. 1920), p.284.
explicitly set out to use welfare to harness such loyalty. Indeed, they provided canteens, large sports grounds and pavilions and encouraged the formation of football and cricket teams, athletic clubs, fishing clubs, and choral societies. They emphasised that these actions were "not wholly inspired by the sordid motive of keeping men and boys in good condition in order that they may do their work better," rather as men, they "preferred to see their workers fit and well and were willing to do something to ensure this."73 Nevertheless, recreation facilities, together with safety-first committees and ambulance classes, were a method by which the firms could invest in the health of their human resources and contribute to their efficiency. In addition, combined with annual sports days and works trips, they were also a method of fostering worker loyalty and co operation. Indeed, in 1925, Firth's directors explicitly stated that "the sports club, the garden society, choral society and orchestra were all doing their educative work...developing the co-operative spirit"74 and, in 1928, following a trip to Blackpool, they expressed the opinion that "there is no doubt that these gatherings maintain that friendly personal relationship amongst our work people"75 Thus, in terms of the metaphor of culture as ’manager-controlled rites', the annual trips were a key mechanism for reinforcing loyalty and trust.76 Indeed, Edgar Allen’s directors considered that annual trips in particular, and welfare in general, gave each man "the feeling that he was regarded as something more than a mere cog in the industrial machine" and developed "mutual confidence and co-operation between management and employees."77 A confidence and co-operation that was galvanised by enabling each and every employee to become a shareholder in the company.
The available evidence suggests that the firms were successful in their efforts to foster a company culture based upon reciprocal loyalty and obligation, and this lends support to J. Griffith's claim, that cultural values and symbols may be manipulated to desired ends.78 For example, The Worker appears to have ceased publication in the mid-1920s, and both Firth's and Edgar Allen's were noted for the long-service of their employees and for the cordial relations between capital and labour. Indeed, in 1939 a Sheffield newspaper ran an article entitled "Firms Pride in Workers' Long Service." This article reported on a ceremony in which Firth-Brown’s Managing Director personally presented certificates of long-service to 952 workers, each of whom had been employed by the firm for over twenty five years.79 This ceremony can be analysed as a 'social 73Edgar Allen Works and Sports Magazine, no. 83, (Sept. 1927), p.28.
74 The Bombshell, vol.9, no.8, (Aug. 1925), p.285.