The Enterprise, the Worker and the Public

In modem business, certain relations become necessarily established between the enterprise itself and all its members, on one hand, and the public, on the other hand. These are known as "Public Relations" and "Human Relations". Based on psychological factors, they have many spheres of interaction and are even called on to complete each other. It is interesting to study them successively, and to attempt to form a synthesis.

"Public Relations"

The beginning of "Public Relations" in the United States is due to the fact that the American enterprises were threatened in their very existence by what was essentially a crisis of progress. This threat consisted of a very severe antitrust legislation which originated and can be explained in the economic changes which took place in the United States right after the War of Secession. From these economic changes, there arose a powerful movement towards the forming of trusts, mergers and large enterprises which tended necessarily toward a scattering of personal resources and to certain abuses. An opposition movement arose, which led to an extension of Federal powers over commerce and industry. The Sherman Act, voted in 1890, forbids all forms of collusion between enterprises which might affect free trading or lessen competition. The application of the Act is carried out by a specialized agent, the Federal Trade Commission.

Faced with such a system, the large American enterprises were obliged to react, to find means of defence. As these anti-trust laws were based on public opinion, it was necessary to reach the public and give it complete and understandable information. Wherever, "Public Relations" programmes have been well carried out, the people's verdict has been favourable to the enterprises. This is easily explained, as by educating the public, they appealed to a very powerful sentiment in mankind: the pride that each individual feels when he has an intimate knowledge of someone or of an organization which has a certain authority. This is what "Public Relations" try to realize, to give each one the feeling that he is taking part in the life of the enterprise. In destroying the divisions which exist inside the enterprise by creating an exchange of ideas, the "Public Relations" increased production. By making the enterprise a name known and liked, they attracted the loyalty of buyers. By continually informing the shareholders they made of them a moral force which supported the enterprise's policy in a positive manner. Finally, by discussing openly all the problems of the enterprise, they reduced greatly the bitter character of certain social conflicts. With this conception, the American industrial leaders learned by the practice of "Public Relations" that virtue and interest go together, that moral values remain the basis of all the industrial activity.

The techniques used to influence those outside depend on the information1 methods available in each country. On the other hand, the techniques used to influence the personnel of the enterprise are fairly uniform and depend especially on the size of the enterprise. The large enterprise may find that the best ways of reaching the personnel are the Company newspaper, the booklet for new employees, information bulletins, films and conference cycles. Small enterprises have the advantage of being able to use the most efficient method: this is regular meetings where the workers and the management meet and talk over in a friendly way, as fellow-workers, everything concerning the life, the reverses and the success of the enterprise. The aim must always remain the same: fight anonymity which makes the enterprise remain a great unknown for its personnel; make the ties personal which bind the worker to the enterprise. In addition to appealing to the intelligence of the employees, we must also appeal to the workers feelings by means of "Human Relations".

"Human Relation"

The movement of human relations is at the same time, the result of the Scientific Organization of Labour movement and a reaction against it. The purely mechanical system perfected by F. W. Taylor, helps and at the same time, forces the worker to improve his efficiency. This too rational research' caused excesses and gave rise to two diseases up to this time unknown: industrial fatigue and monotony. Gradually a truth that had been long forgotten began to be noticed: that there is a close relationship between the benefits a man receives and his state of mind, between efficiency and psychology.

The founder of the movement of "Human Relations" within Industry or of sociology applied to the enterprise is Elton Mayo, professor of the Harvard Business School. The first outline of the sociology of an enterprise came from a scientific study which has remained unequalled: what is called in t h e United States, the Western Electric Company experiment. The Company wished to isolate and measure the influence of different physical factors on the efficiency of the industrial worker. Average workers were picked out and put to work by separate, groups under different experimental conditions. Curiously, the experimental' conditions could be changed as much as was wanted and yet efficiency continued to improve. The results of the research work were confusing because beforehand it seemed as though there existed a relationship between lighting conditions and the output of the workers. Elton Mayo found the crux or the problem or the factor of which nobody had thought. During the research work, the whole relationship between persons and between groups of workers involved in the experiments had been fundamentally changed: their relations with their superiors, their relations between themselves, their relations with the other workers of the factory. In other words, during the experiment, the researchers had brought a revolutionary change to the usual methods of management. This change was so important that besides this, all the other physical changes remained without consequence and Elton Mayo decided to extend his experiment which over a period of twelve years eventually covered over 20,000 workers representing many different nationalities and carrying out a very great variety of tasks.

From this research is brought out the fundamental conclusion that among the motives that guide the worker in his task, the material motive is not the most important one. The efficiency of the worker depends in the final analysis on the satisfaction he feels in his relations with other men. The needs that he tries to satisfy most stubbornly are above all moral and psychological needs. Numerous inquiries carried on in other enterprises only confirmed the value of these findings. The "Human Relations" movement tries first of all to determine what needs the workers are trying to satisfy in their work. There are first of all individual needs and then social needs. In fact, the workers of the enterprise form, whether we like it or not, a live group and the relations of each individual to the group as well as the morale of the groups form the atmosphere in which work is carried on. The studies of Elton Mayo and George Lombard show that absenteeism and labour turnover in the large aeroplane factories in the United States were affected by the existence of these "informal" groups formed by the workers themselves in the factories; inside these groups are developed practices, traditions, and unwritten social code, a hierarchy of persons and values. The problem of changes is then not studied only in technical terms but also in taking into account their effects on the constitution and routine of the groups. If circumstances oblige the management to allow the technical point of view to take precedence, they will, nevertheless, take care to explain it to the workers in plausible terms and attempt to secure their cooperation.

It is especially under the impetus of the last war, and the increase of unionism in the United States, that the movement of "Human Relations" was so widely extended. This movement of "Human Relations" re-appraises in psychological and sociological terms the entirety of working conditions. It tries to assure a better psychological formation of the framework of the enterprise. In each one of its stages, it is the result of a harmonious cooperation between industry and university and furnishes business men methods with which to carry out better their function of management. This is why the exercise of modern industrial management must be done at the same time by 'Public Relations" and "Human Relations". If we only use "Public Relations" we risk missing the crux of the problems which arise inside our enterprises and only look for superficial solutions. If we only use "Human Relations" we are hiding the light under the bushel and we fail in our greater duty to society. To "Public Relations", we must give emphasis, we must enrich them by the teachings of "Human Relations". Together, they have great value because they put the social problem in a framework in which it must be solved — inside the enterprise itself. We must substitute for management by tradition, management by persuasion.

The first indispensable condition in applying this new conception of the function of the manager consists in creating inside the enterprise a system of communication. Each worker must know clearly and continually what he is doing, what place he occupies in the working of the factory and what place the factory occupies in the life of the community. This point is extremely important. The communication of certain results is desirable but not sufficient in itself, it is necessary at the same time to furnish a basis which permits them to be appreciated. This basis is furnished by the method which consists of comparing present results with past results, the results of the enterprise to those of the industry as a whole. The workers must understand in a general way the policies followed by the enterprise. Finally, the workers must know their managers. This is "downward" information, but management by persuasion supposes also that a current of communication exists from the bottom to the top in such a way that management realizes what the employees think and feel.

"Public Relations" try hard to bring together management and workers in the enterprise by making the enterprise a being which the workers know intimately and in giving the simplest tasks a wider social sense. "Human Relations" try to bring management and workers together by making communications a bond running in both directions and bringing men together by their feelings as much as by their intelligence. It is clear that in this renewal of our methods of management the social sciences are called upon to play an important role. It is necessary for the social sciences to be brought out in the light of day and for this reason industry and the universities must cooperate.