Productivity is an Attitude
After World War 2, European manufacturing and management practice was a generation behind the US. Under the Productivity Program of the Marshall Plan, several thousand European businessmen, union officials, and technicians were sent to America to study the causes of their productivity.
Productivity is a social and moral responsibility
Officially, the program went by the name of Technical Assistance. Funded by European governments, the cost of the program was roughly 1.5% of Marshall Plan capital assistance, or $300m (this has a relative inflated worth of $3,3bn today).
Europeans were organized in some 200 productivity teams and toured the country for several months. They studied the likes of foundries, stores on Fifth Avenue, automotive companies, the making of brushes, textile mills, business schools, breweries, printing companies, and labor unions.
Initially, European experts were focused on machines, tools, and specific techniques. However, they soon realized that these elements have little to do with productivity. Indeed, social organization and moral values underlie and explain America’s industrial achievements (rather than the lack of wartime destruction).
Productivity can be studied and learned
The reports of the Marshall Plan stress the importance of management and productivity as a social principle. Accordingly, productivity was found to be a qualitative, rather than a quantitative phenomenon. This relatively inexpensive idea of the Marshall Plan, to send productivity teams on field trips, increased efficiency, and labor productivity in Europe after World War II. A similar program could increase incomes and improve productivity in present-day undermanaged countries.
Books
The Marshall Plan: Dawn of the Cold War, by Benn Steil, Simon & Schuster, €16.26, 624 Pages
Articles and Reports
Technology in Society: Marshall plan productivity assistance — A unique program of mass technology transfer and a precedent for the former Soviet Union
Monthly Labor Review: BLS and the Marshall Plan: the forgotten story
Contemporary European History: Danish Study Visits to the United States under the Marshall Plan's Technical Assistance Programme
The George C. Marshall Foundation: The European Recovery Program
James O. McKinsey: Business Administration (New York, American Management Association)