For a long time, engineers and office workers of various types, as well as factory workers, were active in Ericsson's main plant at Telefonplan in Midsommarkransen. As production was rationalized and the products became increasingly technically sophisticated, the percentage of white-collar workers grew at the expense of factory workers. Traditional technology lost ground and, when new technology and IT had definitely taken over in the 1990s, traditional industrial operations ceased at Ericsson. The factory worker disappeared and was replaced by IT personnel. However, the changeover from traditional telecommunications and mechanical technology to "pure" IT was a drawn-out process that extended over a number of decades.
The shortage of both skilled and unskilled factory employees became very clear in the early 1960s. Ericsson was doing well and had to recruit new workers for its production plants. To solve the problem, the Company shifted production from the main plant at Telefonplan to factories in Söderhamn, Örebro and Visby. Despite these moves, the number of workers in the main plant continued to grow.
Ericsson's production required a large workforce. In the early 1960s the factory union (Verkstadsklubben) had more than 2000 members and the company – in an expansive period that would continue – had notably strong order bookings. This was during the so-called record years. Swedish industry was prospering and well-being increased in the country.
Ericsson employed workers from other countries and the factory union developed a program to accept the new members. A Finnish union was formed for the Finnish workers. Employee turnover in the plants was rather high and Swedish-language courses were arranged for the immigrant workers.
An important step was taken in the mid-1960s when a data center was placed in service. It processed inventory routines, as well as incoming shipments and outgoing deliveries. It meant that traditional office work could also begin to be rationalized. The stress in the plants attracted attention: 500 male workers were asked to respond to questions dealing with time-pressure, relations with work supervisors, and other matters related to their jobs.
The company and the unions also conducted a mental health campaign that represented an attempt to correct "comfort" problems in work life through information and participation. For most persons, work in the factories was rather monotonous. Few jobs were challenging.
New, fast factory machines were installed in the early 1970s to handle the increasing production demands. The company received a number of large orders and also introduced a new type of intercom telephone that was small and light.
During this period the Swedish Employers Federation and the Swedish Trade Union Confederation concluded a rationalization agreement which was applied at Ericsson. The new data technology was now about to have an impact. The Company purchased its first numerically controlled (NC) machine in 1973. Dr. Marcus Wallenberg, chairman of Ericsson's board of directors, declared that the Company had to invest in new technology; it was the wave of the future, he said.
A Group Corporate Council was formed at the main plant to deal with problems of employment and relocation that Ericsson knew would become major issues in future years as a result of the technical and organizational trends within the company and the industry.
A watershed event occurred during the latter part of the 1970s. The new AXE exchange system was introduced, resulting in substantial successes for Ericsson. It soon became clear that the system was a great success. With improved production methods, the percentage of factory workers was further reduced and some of the production shifts also caused changes in plant layouts.
Traditional industrial jobs were about to disappear and the new concepts had a powerful impact. The Company implemented a thorough reorganization in the early 1980s. At the same time Ericsson started a quality-improvement campaign that was conducted by Ericsson Quality, a newly formed company. Sales of mobile telephones now also began to accelerate.
A few years later – in the mid-1980s – the market for mobile telephony exploded and Ericsson was one of the leading players. Industrial operations had now virtually ceased in the main factory. But the production of cabinets continued to create substantial employment in the plants. There were also some other typical industrial jobs. To encourage and promote new ways of thinking, and to create self-reliance in the plants, the Company started a project to produce AXE cabinets in a more efficient way. The project was appropriately christened "MAXE."
Aided by the new, lightning-fast information technology, the restructuring program was well under way, however, and the quality-improvement and organizational programs were continued during the 1990s. Beginning in the middle of the decade, the Company sold off the remaining parts of its traditional production, including relays and cabinet mechanics. As a result, there were in principle no traditional industrial jobs left in the main plant at Telefonplan. The old L M Ericsson had become part of industrial and labor history.
Author: Bill Sund