The Wages of Automation

In a once barren valley nestled among the green hills of Wales, Queen Elizabeth II last week pushed a button and put to work Britain's newest steel mill--the Spencer plant of the government-owned Richard Thomas & Baldwins company. The new plant is designed to produce high-quality steel by means of the fast-spreading LD oxygen process (see below). And it has one other remarkable attribute: it almost runs by computer. From receipt of customers' orders to the final finishing of bars, its operations will be scheduled and supervised by a unique corps of machinery designed by Britain's Elliott-Automation Ltd.

Elliott-Automation in barely 16 years has established itself as one of the world's most sophisticated manufacturers of automatic controls, and the largest outside the U.S. Elliott's 38 divisions and 25 factories turn out hundreds of complex products ranging from industrial computers to automatic homing heads for missiles. Since 1959 the company's sales have increased 122% to $756 million, and its annual profits have soared almost 83% to $6.6 million.

Taking Over the Buyer. Elliott owes its enviable record to the vision of one man--bushy-browed Sir Leon Bagrit, 60, its Russian-born managing director. Bagrit, who was brought to Britain by his parents during World War I, started out as a salesman for a London scale manufacturer, founded his own engineering company in 1935. In 1946 his fast-growing firm was bought up by Elliott Brothers, an old-line instrument maker with dwindling sales. Bagrit took command of the merged company. Impressed by the control systems developed to leash atomic energy during World War II, he decided that such automatic methods would also work in industry, and would be of vital importance to Britain. Lacking most raw materials, Britain must depend on the competitive price of its manufactured goods to maintain a place in world trade. "In this country," Bagrit likes to say, "automation is a matter of life and death."

He found the British government indifferent and set out to sell the country on the idea himself. To ensure that Elliott's research would not be a wasteful duplication of effort, he made licensing arrangements and agreements to exchange information with British and foreign companies in the same field. Although Elliott's own designs are impressive enough that the company has sold to U.S. firms 20 of its "803" computers (price: $84,000 apiece), over 25% of its products are made under license from such U.S. companies as National Cash Register.

Time Out for Music. Bagrit himself attributes much of Elliott's rapid rise to the autonomy he grants his division heads--a habit that has stimulated prideful competition among them. This system has the added advantage of assuring Bagrit, who as a young man picked up spare cash by playing violin in the Royal Philharmonic, ample time to indulge his taste for music, art and philosophy.

Until recently, Elliott's operations were confined almost exclusively to Britain. But Bagrit, an enthusiastic backer of British entry into the Common Market, is now turning his attention to Europe, secured a beachhead on the Continent last year by establishing Elliott-Automation Continental in Luxembourg. "The next few years," he says, "will see industrial competition between nations on a frightening scale."

This file is automatically generated by a robot program, so reader's discretion is required.