Carbons to Computers

A Short History of the Birth and Growth of the American Office

The locally oriented American economy of the early 1800s did not need offices as we know them today. Business was run then much as it had been run for half a millennium. Goods were made, transported, and sold. With the help of a few clerks, merchants ran their small companies as family businesses. Few differences distinguished the merchants in early-nineteenth-century Boston from those in thirteenth-century Florence.

The early nineteenth-century merchant was his own importer, exporter, banker, wholesaler, retailer, and possibly shipowner. All businesses--even export businesses--were local. The merchant himself oversaw every aspect of his business, and his clerk posted his accounts in a ledger book or copied out his correspondence to a buyer. Even if he was a very successful merchant, or ran a large textile mill, he had no more than three men helping him with administrative tasks.

With the arrival of the railroad, however, the general merchant's business and the entire nature of American commerce changed forever. The railroad not only united the states, changed how and where we lived, and dramatically altered the country's image, it also transported goods almost anywhere. Suddenly, coal and the steam engine made it possible for business fortunes to increase as rapidly as they could be expanded westward. Using the railroad, local businessmen could do business nationally. And they could no longer do their business in their heads. Once the stakes for business increased, so did the logistics.

Railroads and the Birth of the Modern Office

If the small office of a textile merchant would be administratively overwhelmed by expanding trade, imagine the problems for the new railroad companies. For the first time in American business, the financial investment in an enterprise was too large for one owner or even for a small group of owners. Hardly a mom-and-pop company, the railroad was a multimillion-dollar corporation of stockholders and bankers that had to supervise hundreds of employees and its investment.

Railroads employed conductors, ticket sellers, engineers, construction workers, accountants, clerks, and payroll officers. Their employees were distributed across the country, serving the entire transportation network and offices along the way. Administering this corporation profitably meant developing not only an entirely new system of organization but also a vast interoffice communication system.

The stockholders and board members could not run the railroad's day-to-day operations. Instead, full-time employees were needed to make decisions and supervise the monies and staff necessary to keep the corporation profitable. The railroad needed men who were willing to and capable of acting like owners for the owners without any chance of ever being owners. The railroad needed managers just as much as it needed rails and boxcars and a reliable and safe transport system to sell. Coordinating the movement of people and goods, maintaining roundhouses, rail line, and stations, and making a profit were now the manager's job.

As demand for the railroads' services increased, more and more managerial employees were hired and a hierarchy of managers took its place on the corporate organizational chart. Owners and board members soon had little say in the operation of the railroads. They may have set fiscal policy, but their employees in offices throughout the country put the policy into practice and ran their company. By 1840 or 1850, management was a permanent part of the railroads' organization, and managers began to think of railroading as a lifelong career with chances for advancement. This was the beginning of modern business and its offices.

Mid-level managers oversaw central offices, supervising bookkeepers and clerks. These offices kept in close contact with each other by telegraph and daily mail carried by the trains. The mid-level managers reported to top managers, who reported to the board of directors.

By the 1880s, this organization and hierarchy would be duplicated by Western Union, the banking industry, and insurance companies. These businesses, like the railroads, were big, complex, geographically dispersed, and responsible for huge amounts of money not owned by one person or family. Their success was replicated by large manufacturers, importers, and chain stores. The railroads' administrative organizations had successfully proved that they could increase productivity, volume, and profits. Every other large business followed their example.

By the turn of the century, business administration was a profession. Harvard, Wharton, and the University of Chicago were already offering MBAs (master's degrees in business administration).


Workers today take for granted the structuring of authority in the workplace. "Boss," "supervisor," "overseer," and "manager" are seen as interchangeable terms. We may think there were always bosses, certainly before the coming of the railroad. But for the purposes of this project, it is important to see the manager as a historical development that can be dated to the 1830s.

Senior workers represented a familiar concept before that time. Agriculture had overseers; business had superior clerks. Some prosperous banks and insurance companies had men who were differentiated from other clerks by the trust and status their employers gave them. They supervised the work of one or two other clerks and often met clients.

But none of these highly regarded employees were true managers, because none of them could make business decisions for the owners. They had duties and responsibilities but not authority. They acted for the owner by directly fulfilling his wishes.

The railroads, on the other hand, needed people to act in place of the owners and stockholders. When the railroads hired professionals to coordinate and control their business, to keep up with the railroad's day-to-day finances, these managers quickly took charge. They reinvented the system of keeping books and created departments to do the office work.

They introduced daily balance sheets and operating ratios, divided responsibilities among accounting offices, marketing offices, personnel offices, executive offices, and mailrooms. The clerical jobs in each of these different offices were specialized, reflecting the rational compartmentalization of the corporation. The managers had succeeded in creating a whole and functional organization out of thousands of parts and people.

Just as the conductors worked only with passengers on the trains, clerks in the receiving office worked only with incoming receipts. Clerks in the accounting office only posted entries in ledgers, and so forth.

By the 1890s, managers had so completely modernized business methods that they would have been more comfortable in today's offices than in the offices of the 1820s. By 1930, the organization and particularization of work was even further refined, in large part due to Frederick Taylor.

Scientific Management

Frederick Taylor began what was known as scientific management. In the 1880s, when most workers still labored in agriculture or factories rather than in offices, Taylor developed techniques in the steel industry that taught factory managers how to save money and increase productivity by making their employees more efficient. How the job was to be done was thought out by management; workers were mere instruments to execute the tasks.

Throughout the nineteenth century, as American capitalism built its industrial base, the factory system drew its labor force from the peasant and village cultures of Europe. The huge wave of immigrants who entered this country in the 1800s became the backbone of developing mass production.

Taylor's principles were meant to separate the worker from his Old-World artisan culture--the idea that one person created an object, according to tradition and his own skill. The new order divided skills into a sequence of simple procedures to be taught to workers and monitored by management.

The rigidity and dehumanizing aspects of scientific management, from its beginning, engendered widespread working-class hostility. Nevertheless, it provided a general strategy which, in the long run, became the basic American approach to the structuring of labor processes.

Scientific management's success in industry led to its adoption in the office. Office managers knew too that time was money. Soon there were clerks who only opened letters all day, clerks who only typed, clerks who only filed, and couriers who picked up and delivered files from one person to the next. Typists did not take shorthand, and clerks who took shorthand (stenographers) did not file. Theoretically, valuable company time was wasted when a stenographer left her desk to file.

As only one way was seen to do a job, individual approaches to tasks were discouraged. Standardization made it easy for managers to keep a close eye on all workers and work flow, counting the typists' strokes or the number of letters opened per hour. Offices were often open spaces, without partitions, where desks could easily be watched.

Workers were kept to their jobs, which they pursued in silence. They were not allowed to talk because conversation cut down work time. Some employers put partitions between desks to keep talking to a minimum, even though they then had to patrol the floors.

By the 1920s any real difference between some office work and the factory production line had disappeared. The office, like the factory, was tedious and stressful for the worker and closely monitored by the manager.

Why did people tolerate these working conditions? As America entered the Great Depression, people would do anything to keep their jobs.

The Postwar Economy and the Office

When World War II ended, management and the office environment changed radically and quickly. Workers on the homefront, including many women who were filling in for the men at war, had essentially maintained the status quo during this period of national upheaval. But with the war over, American industry tooled up to satisfy pent-up demand for consumer goods after the long war years of scarcity. Factory jobs were paying far more for unskilled and semi- skilled labor than were office jobs.

Employers had to make office work more attractive. Instead of increasing clerical salaries, however, management emphasized the respectability or status of office work. Scientific management was modified to make jobs less routine, and the look of the office began to change to outwardly show this functional change.

Advertisements for jobs described "friendly" offices and bosses. Attractive health insurance and retirement plans became part of the financial rewards for working.

Physically, offices were being "landscaped." No longer cousins to the factory production line, offices became color-coordinated with comfortable and attractive furniture. While executive and upper management offices had always conveyed the good taste of their inhabitants, general offices now gave out the same message: a clerk who worked in pleasant surroundings was obviously someone enlightened if not culturally superior. For many workers, their office environment was far more luxurious than their homes.

The role of status in American culture is a complex topic better treated elsewhere. Within this context it should be recognized, however, that in the booming postwar years Americans were able to fulfill long-held dreams of home ownership, higher education for their children, and the acquisition of objects and symbols of wealth. Factory work with its lower-class or working-class connotations thus became less attractive to many people than the clean, gracious environment of a corporate office.

In the postwar era of change, scientific management was replaced with human relations. Management had discovered from experience that people restricted to their desks doing repetitious tasks became fatigued before the end of the day. By giving workers breaks in their day, more varied work to perform, and coworkers to work with rather than alongside of, they actually became more, not less, productive. People generally no longer just typed or filed all day. If they did, such activity at least took place in a friendly office with plants. The humanitarian style of management worked, and company loyalty and productivity increased.

By the 1960s, most offices were carpeted and relatively well furnished. Some workplaces piped in music; most were softly but effectively lit. Equipment was "the latest," and workers began to see their work as important to the company.

Offices Today

Today's workplace design is no longer dictated by the product or service produced; nor is it a matter of "looking good." Rather, it is driven by increased competition, rapid technological advances, and shifts in working styles. In the 1990s, functionality based on the actual process of work seems more important than corporate image.

Increased competition and shrinking profits have forced corporate America to slim down. The 1990s workplace has become lean and mean, opting for smaller and less private spaces and more powerful, versatile technology. The walls are tumbling down: Managers and even some CEOs who once presided over their employees in large, private, wood-paneled offices have moved onto "the floor," joining their subordinates in a maze of cubicles meant to foster equality, increased communication, and teamwork.

The "office landscape" concept, which was introduced in the early 1960s, dictates that workspaces should be organized to reflect the flow of information and communication patterns. More than thirty years later, an estimated forty million Americans, nearly 60 percent of the white-collar workforce, work in cubicles. Modern corporate management is learning to adapt to a new business culture in which teamwork and communication are becoming much more important to worker productivity.

Smaller workspaces also save corporations money. Rising real estate, utilities, and equipment costs have forced many companies to review their bottom lines and to reconsider where they put their shrinking resources. Whereas it was once important to have impressive offices--which was often intended to inspire confidence in a company's prestige and "staying power" the current trend is toward modest facilities, which are thought to foster a perception of cost consciousness.

The corporate reality may differ from the perception, however. Despite the physical changes in the modern office, inequalities in rank, talent, and pay still exist in the workplace. And for some offices, the changes may simply represent what management would like workers and customers to believe about the company.

Not everyone appreciates the office cubicle culture. Some workers feel uncomfortable without doors that they can close, and although communication between colleagues may rise, so do distractions. Certain specialized workers whose tasks require focused concentration might be particularly sensitive to the distractions that often exist in the cubicle culture, preferring to work in private offices.

Technology, too, has had a significant impact on the design of the workplace. Desktop computers have replaced typewriters, adding machines, and file cabinets. E-mail and voice mail have all but eliminated the stackable "in-box" and telephone message slips. Fewer offices maintain onsite libraries and publications departments, opting instead for online databases and desktop publishing. The result is lower overhead, less clutter, and higher worker productivity.

Many office computers are linked together through local area networks (LANs), enabling employees to share files and resources. Many of these desktop systems are networked with other offices via intranets and with systems around the world via the Internet. Networking fosters rapid communication, enables collaboration among workers regardless of geography, and permits access to the wealth of information posted on the World Wide Web.

Changes in society, such as a more mobile workforce and workers' demands for flexibility, have fueled the development of portable office equipment. Laptop computers, cellular phones, and facsimile machines now equip a growing telecommuting workforce and, in some cases, have eliminated the need for central offices altogether. The option of telecommuting has become a valuable tool for companies competing for skilled employees who are tired of commuting long distances from the suburbs.

In addition, the ready supply of independent contractors, many of whom maintain fully equipped home offices, has enabled many businesses to employ freelancers for certain tasks that previously would have required hiring more staff and purchasing specialized equipment. The cost savings for many of these companies can be substantial.

Offices of the future will likely continue to tailor the physical conditions of workers to the work being done, with more focus on the work "process." Office technology will continue to evolve toward more versatile and compatible systems in response to global information demands and more complex data management tasks.

Introduction || Birth and Growth of the American Office || Office Equipment
Office Organization || Global Office || Conclusion
Historical Timeline || Lesson Plans || Resources || Site Contents
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