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From Managing Factories to Managing Knowledge Networks

Less than a decade after Henry Ford reshaped manufacturing with an automated assembly line and $5-per-day wage, the Wharton School created its first research center to address the challenges of the industrial era. The Industrial Research Unit (IRU) was founded in 1921 (then called the Industrial Research Department) "to study the economic and social problems of business." It conducted pioneering studies of industrial relations, analyzing problems and economics of diverse industries and a variety of issues, including employment of African-Americans, strikes, measuring the cost of training, and airline mergers. It later became known for its research into pricing history, labor migration and mobility, and productivity.

One early leader of the IRU, Wharton faculty member George W. Taylor, left behind a legacy of leadership in the field of labor and industrial relations, which he founded as a young scholar in his late twenties. A staunch believer in the equality of the parties in collective bargaining, Taylor led the field with his work in labor arbitration, mediation, and other sophisticated forms of alternative dispute resolution.

During the Depression, Wharton turned its attention to studying the challenges of unemployment. President Herbert Hoover appointed Professor Joseph Willits to serve on the President's Emergency Committee for Employment, where he advocated a national employment service. When Franklin Roosevelt became president in 1933 and set up the National Recovery Administration (NRA), he asked George Taylor and several colleagues to help design NRA codes in their industry.

Under the direction of Professor Herbert R. Northrup, chairman of what was then called the Department of Industry (today's Management Department), Wharton became the largest academic publisher of industrial labor relations and personnel materials. The Labor Relations and Public Policy Series published dozens of monographs on collective bargaining, labor conditions, and the regulation of labor/management disputes. A separate series published between 1967 and 1975 called "The Racial Policies of American Industry," analyzed African-American employment policies and problems in 31 industries.

As large corporations began to emerge, Wharton established a new center to study the concerns of the CEO and top management team in the 1980s. The Reginald H. Jones Center for Management Policy, Strategy, and Organization was founded by General Electric in honor of its distinguished former CEO and Wharton alumnus. In 1983, Professor Edward (Ned) H. Bowman came to Wharton as the first Jones Professor, a title he held until he passed away in 1998.

As the challenges facing business shifted from "industry" to "human resources," the IRU was transformed into the Wharton Center for Human Resources. This center, under the current direction of Professor Peter Cappelli, has been at the forefront of examining the changing nature of work and the workforce, including increased mobility of the workforce and the decline of organized labor. In addition, Wharton founded the first center to study leadership and change management and has been at the forefront of studies on work/life balance.


Dr. Edward (Ned) H. Bowman, renowned scholar of management who was founding director of the Reginald H. Jones Center for Management Policy, Strategy, and Organization and first holder of the Reginald H. Jones Professorship of Corporate Management at the Wharton School, died in 1998. He was one of the world's leading scholars of management policy and corporate structure. He also served as Wharton's acting Deputy Dean for Academic Affairs from 1989 to 1991.


Dr. Howard E. Mitchell, a respected teacher, scholar, and mentor, became only the second African-American professor at the University of Pennsylvania when he was hired in 1955. In 1986, the Black Wharton Undergraduate Association established a scholarship in his honor. In addition, the Howard E. Mitchell Fellowships, awarding graduate fellowships and internships for minority students, were established in 1992. Mitchell remained active in teaching until he passed away in the fall of 1999.

"The most significant human resources issues facing companies today have to do with the collapse of the older order. The big challenge now is the breakdown of traditional corporate career paths where job security and internal promotion were expected. Companies need to find ways that harness the power of the market and rethink what they really need from an employee. Lifetime loyalty, for instance, is perhaps not needed today. Human resources issues and intellectual capital are much more crucial now that labor markets are tighter. Human resources will become a bigger and bigger issue as long as this tight labor market continues."
Professor Peter Cappelli, George W. Taylor Professor of Management, Co-Director of Wharton's Center for Human Resources, and author of The New Deal at Work: Managing the Market-Driven Workforce

Former Dean Joseph Willits outlines a policy for national employment service in a handwritten draft of a speech at Princeton in 1934.

Wharton Professor George W. Taylor, called the "father of American arbitration," is credited with helping to settle more than 2,000 strikes during his career. He was appointed to serve under five presidents, including Lyndon Johnson. In 1995, Taylor was inducted into the U.S. Labor Hall of Fame.

Professor Michael Useem (center), founding director of Wharton's Center for Leadership and Change Management, discusses leadership issues with Executive MBA students.

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