Thanks to Henry Ford and his meticulous methods to increase the productivity of workers on his assembly line, the economy transformed from one of craft production to one of mass production. In addition to “Fordism,” the past 100 years in the US economy can be explained by using “Levittownization,” “McDonaldization,” and “WalMartization.”
Ford perfectly implemented Taylor’s ideals of rational organizations in order to provide cars to the masses. Taylor’s scientific management proposed that scientifically determined procedures would allow employees to work at peak efficiency, in return for top wages. In addition to standardized labor, Ford added specialized machines, interchangeable parts, and conveyor belts. In 1914, after the assembly line had brought Ford much success he came up with a new idea in order to cut down on the wear and tear of workers; he began paying employees $5.00 a day (more than doubling the average worker’s pay) and cut the workday down from nine hours to eight. By standardizing the product, Ford was able to cut costs substantially (from $780 in 1910 to $360 in 1914) giving the common man the opportunity to buy a car.
As Ford had minimized the per unit cost of a car in the early 1900’s, William Levitt did so with the price of houses in the 1950’s. Levitt’s vision of suburbia transformed America to how we know it as of today. Before WWII home building was a part of the dying art of craft production, each home having a unique design. As soldiers returned from war, families dreamed to own their own homes away from the congested cities. Levitt made these American Dreams happen by standardizing home building. In Levittown, there were two styles of homes offered and could be built at a rate of 18 in the morning and 18 at night. For $100 down, a family could have a house outfitted with heat, a garage, a washer, and a stove.
In the 1950’s the common man could already own a car and a house affordably, and soon he would also be able to go out to eat, all on a tight budget. Ray Kroc founded McDonalds in 1955 and it spread like wild fire across the United States. McDonalds did for the food industry what Ford and Levit had done for the automobile and housing industries, and what Sam Walton would shortly do for retail.
WalMart is the most recent company to revolutionize the United States’ economy. The company is able to offer affordable retail products and groceries to many Americans.
Wal-Mart’s prices are about 14 percent lower than other groceries’ because the company is aggressive about squeezing costs, including labor costs. Its workers earn a third less than unionized grocery workers, and pay for much of their health insurance.
Each employee executes a specific task that allows the company to run efficiently. Competitors often have a tough time matching the prices of WalMart because it is difficult to keep their costs down.
Ford’s model gave rise to giant organizations built upon functional specialization and minute divisions of labor. These companies are each rational organizations as Weber has defined. Each has a clear hierarchy with defined goals, and workers have specialized tasks. But how “rational” (using the layman’s definition of the term) are the employees? Barbara Ehrenreich describes how difficult it is to work for such a company in Nickle and Dimed. Every day performing a monotonous specialized task all for a mere minimum wage. Is there really nothing else? What will it take for these workers to break the cycle? And, are companies like WalMart and McDonald’s just making it harder for minimum wage workers to get out?