The interface of disciplinary practices and accounting: the case of the Royal Tobacco Factory of...

Introduction

Many studies have emphasised the role played by calculation techniques as means of facilitating business management. Although there is no agreement on exactly when they first arose, it is clear that they were very important as procedures for exercising control. On the one hand, significant studies have been made of the British Industrial revolution, particularly those by Edwards (1989), Edwards and Newell (1991), and Fleischman and Parker (1990, 1991, 1992), in which the origin of cost accounting is explained in terms of economic utility; it is also associated with the role of the entrepreneur or businessman, motivated and concerned about reducing cost levels and maximising profits, in exploiting new technologies and defending himself against competition.

However, alternative research studies, based on the propositions of the French social theoretician Foucault (1992), abandon strictly economic approaches and explain the utility of accounting in terms of discipline. Hoskin and Macve (1986, 1988, 1994, 2000) explain the origin of double-entry and cost accounting as the consequence of the changes that took place in the field of education. On the origin of double-entry, they maintain that the development of new writing and examination practices was the factor that allowed the design of the double-entry format. They also explain the origin of cost accounting, taking the case of Springfield Armory in the United States during the nineteenth century as a reference. They argue that the efficiency improvements that took place in the armory are explained by the education that its directors received under the disciplinary regime of the West Point military academy. Subjected to pedagogic practices based on the constant development of the use of written work, examinations and their classification according to the results that they obtained, the graduates interiorised and transferred these concepts to their places of work. In this way they made accounting into a disciplinary practice, put at the disposal of the management, that enabled managers to know and control the activity of the employees in their centres of work.

Miller and O'Leary (1987, 1994) focus in particular on the study of standard costs and of budgets. They identify standard costing with a disciplinary accounting technique that allows the behaviour of the individual within the organisation to be known, for purposes of controlling, training, examining and valuing this behaviour in terms of the standards established and deviations from those standards. They also stress the capacity of accounting to guide individuals towards the kind of behaviour that is considered optimum for the interests of the organisation, within the concept that the authors term "the governable person". Loft (1988, 1994) considers cost accounting as a disciplinary technique that allows the individuals within an organisation to be controlled and supervised. In these studies, she indicates that the distinctive characteristic of accounting is its capacity for replicating the process of production on paper, transforming it into monetary terms. This author also emphasises the importance that accounting had in translating the actions of individuals into monetary terms. Carmona, Ezzamel and Gutirrez (1997) emphasise the capacity of accounting to monitor and influence the behaviour of individuals at a distance and indirectly.

The change from home to factory-based production called for a set of practices that would enable the activities of a large number of workers or operatives to be adapted to the requirements of factories. It was necessary to modify life-styles in general and working habits in particular to suit the new social and economic circumstances. For example, the physical concentration of a substantial number of operatives in one single workspace spurred entrepreneurs to devote much attention to means of controlling productive activity and employee behaviour. In effect, this new context made the discipline of work essential.

In the present study, the meaning given to the term "discipline" is taken from the conceptualisation of Foucault, who identifies this concept with the set of methods that allow control of the human body, that ensures the continuous subjection of its strengths or capabilities and imposes on them a relationship of docility-utility (1992, p.188). This general concept of discipline is made particular when the area of application is specified. Thus it is possible to speak of industrial discipline understood as the multiple and complex strategy directed towards making the behaviour of the workers favourable for productive purposes (Gaudemar, 1991), which implies the modelling of individual conduct at all levels. The ultimate objective is to reconstruct the person in a form suited to productive needs, both mentally (where conscientiousness, subordination, obedience, morally correct behaviour, even refraining from idle conversation, are what count), and physically (gestures, movements, attitudes, speed). The intention is to make morality (understood as the set of socially accepted values) into a means of work (Gaudemar, 1991, p.74). Therefore, discipline is a fundamental part of the process of organising, managing and planning the productive life of the company.

Historically the use of various types of discipline has been most clearly seen in the military, in religious orders in monasteries and convents, and generally in any situation where there is collective coexistence. In any collective grouping of individuals, it is necessary for their separate behaviours to be channelled towards a specific purpose; there must therefore be some mechanism to prevent each individual from acting in accordance with individual desire or interest, instead of cooperating for the common good (Fernndez, 1991, p.21). The central problem for any organisation is to find the effective means to allow the efforts of a group of different persons to be directed towards a common purpose, utilising for this controls over behaviour, among other types of control (Macintosh, 1991, p.171). The exercise of such controls implies the direct and personalised observation of the work performed by individuals and the way in which they form it. This thus leads to the development of a disciplinary system that involves vigilance or supervision as its executive element. Thus disciplines arise out of the operational needs within organisations. The accounting system can be regarded as representing and providing a system of control at a distance, configured with the capacity to regulate, sanction and reward various types of behaviour.

However, although the existence of disciplinary systems has been known since antiquity, the take-off of industrial activity during the seventeenth and eighteenth centuries facilitated its development as a general formula for domination (Foucault, 1992, p.141). Such formulas were aimed at making humans, seen essentially as manpower or potentially strong or efficient bodies, into docile and manageable beings that could be utilised to obtain economic returns.

This paper undertakes an analysis of the role played by discipline as a technique of management control in the Royal Tobacco Factory of Seville (Real Fabrica de Tabacos de Sevilla, or RFTS) during the second half of the eighteenth century. Under the perspective of Foucault, three previous studies have been undertaken on this Factory by Carmona et al. (1997, 2002) and lvarez et al. (2002). Carmona et al. (1997) analyse the system of cost accounting established in the RFTS in 1773, with the conclusion that its objectives were to minimise the possibility of fraud and to make more visible the various activities that were being carried out inside the building. Carmona et al. (2002) study the implications that the transfer of the productive activity of the Factory of San Pedro to the New Factory had on the accounting system. They argue that the design of the new premises allowed the accounting practices to become a mechanism capable of putting spaces and times in order, for the purpose of watching over the operatives and establishing discipline in the Factory. lvarez et al. (2002) analyse the use made of accounting techniques as a contributory element to quality products control. For these authors, a strategy for quality control was formulated which involved the punitive control of the individuals whose work determined the level of product quality. Accounting served as an information system and played an important part in this strategy.

Although this paper has several aspects in common with other research dealing with accounting from the point of view of discipline, the detailed study of the Regulations reveals the parallelism existing between the disciplinary authority of the written rules, reflecting the socially-accepted values in eighteenth century Spain, and the accounting system in a production entity managed by a State agency. This question has not previously been considered in depth from a historical perspective. The Regulations defined patterns of behaviour based on discipline and standardised almost all aspects of daily life within the confines of the Factory. It is argued that the accounting system comprised a variety of procedures that translated the fundamental social feature of disciplinary control to the particular area of economic or productive activity. It will thus be shown that accounting records and standards performed the function of imposing, at a distance and more or less indirectly, a necessary discipline on the productive behaviour of a large number of operatives, particularly to prevent theft and wastage of a valuable raw material, tobacco.

This study is structured as follows. After this introduction, the second section considers aspects relating to the consumption, trade and processing of tobacco. Then the regulation and accounting of this activity are discussed with particular emphasis of the disciplinary aspects of both. Lastly the conclusions obtained are analysed and presented.

Historical references to tobacco-related activities

The RFTS is a good example of the State promoting a revenue-generating industrial activity, in the second half of the eighteenth century. Following the introduction of the consumption of tobacco in Europe by Christopher Columbus in 1491 (Goodman, 1994), the Spanish Crown granted to the city of Seville the privilege of importing American tobacco. This then lead to the development of the tobacco-processing industry and the accumulation of valuable knowledge of the productive processes involved in the high value-added end-products. Exploited in the form of a royally-granted monopoly, initially the productive activity was ceded to certain private individuals and carried out in small family or domestic workshops. However, this system was superseded, between 1702 and 1730, through a series of Regulations. In September 1731, the organisation of tobacco production passed to a State monopoly managed by a Government Agency, the Tobacco Revenue (Renta del Tabaco). It was at this time that the Royal Factory was established, fundamentally in order to increase the revenues of the Crown from the production and distribution of tobacco products.1

These revenues were threatened by the existence of contraband; tobacco smuggled illegally into the country, which represented a source of cheaper products, although usually of poor quality, on which duty or taxes had not been paid. Revenues were also reduced by the tendency of those directly involved in the manufacturing activity to steal tobacco from their place of work. Apart from addiction caused by tobacco consumption, this tendency for losses due to theft can also be explained by the widespread poverty of the times. Wages, particularly of the ordinary operatives, were very low, and the application of tax on consumption increased the selling price of tobacco products; these factors encouraged the growth of fraudulent activities. The sale of contraband or stolen tobacco outside the legal distribution system allowed those responsible to obtain additional income and to alleviate their precarious economic situation, in conditions when the majority of the population lived in extreme poverty. This situation of economic penury became even worse for the city of Seville in the second half of the eighteenth century as a consequence of the loss of its rights to handle Spanish trade with the Indies. The official agency responsible for this trade, the Casa de Contratacion, was transferred from Seville to Cdiz in 1717. Another result of economic decline was the movement of many rural day labourers from the countryside, especially in times of harvest failures, to the towns in search of work. This resulted in a "crime wave, particularly of the commonest offences of drunkeness, brawling and armed robbery" (Aguilar, 1989, p. 145). Robberies were frequent and continuous in the houses of Seville, and one proof of this was "the various overflowing prisons that existed in the city" (Aguilar, 1989, p.151).

Although relatively little is known of the actual extent of smuggling, some studies have demonstrated that it was a common practice in the eighteenth and nineteenthh centuries (Rodrguez-Gordillo, 1994), most likely because it was a quick way to make a lot of money. For this reason, the long struggle of the Revenue against tobacco fraud was based on a strategy of control, both outside the Factory with customs controls and police deployment, and inside the Factory, by means of the monitoring, evaluation and control of the productive activities. The internal control methods comprised a system of vigilance set up and managed in accordance with official Regulations, known as "Instrucciones".

The Regulations

These official Regulations appeared as a consequence of the Tobacco Revenue assuming control of the State monopoly in 1731. This led to the Directorate General of the Revenue taking steps to control in increasing detail the functioning of the RFTS. During the period covered by this study, three separate Regulations were issued by the Revenue, in the years 1761, 1779 and 1790; in 1769 there was also a supplement issued to the first Regulation of 1761. Each Regulation was in reality a substantial document consisting of a series of often very specific regulations and instructions.

Initially, in 1731, productive activity commenced in the Factory of San Pedro in Seville, but after several extensions in size, its capacity became insufficient for the increased scale of production. This limitation was overcome by transferring the activity to the so-called New Factory. This was authorised in the Regulation of 1761 promulgated with the objective of regulating and adapting the activities to the new installations since the buildings had been designed for a different form of organising the productive processes, under a different organisation structure. This Regulation gives definitions and descriptions of the functions and responsibilities of each member of the organisation, each of the 21 chapters dealing with this subject being devoted to one particular function. Of special relevance are the aspects related to the discipline and control of the workforce.

With the productive activity now being undertaken in the New Factory, the General Directorate (or Board of Management) of the Revenue occasionally sent Commissions to Seville for the purpose of inspecting and verifying compliance with the Regulation. The reports to the Crown made by the Commission sent in 1776 revealed serious deficiencies affecting many of the productive tasks and the disorder and lack of discipline in the behaviour of the operatives:

Most notable is the deplorable state in which the Factories were found when Your Majesty, in the year 1776, directed the Commission to resolve what was still outstanding (in terms of complying with the Regulation). Much damage, and many bad habits and abuses were verified ... . There were excessive rejections of tobacco leaf and powder (snuff) to be worked, much of the material being rotten and useless, and the rest dissipated, without any fragrance or substance through not receiving any treatment, just being left piled up in the same bundles and in the same condition in which it had been gathered ... .

Various malpractices were confirmed in the processing ... incorrect methods and working of unusable, unacceptable materials; and finally even the order and discipline of the employees and operatives was found to be very deficient (1.1779, 6).

In this situation, and because a decreasing trend had begun to be observed in the consumption of snuff, the Regulation of 1779 was issued with the objectives of eliminating the malpractices found and to impose a change in the methods of production. But this decision did not slow down the decline in snuff consumption in favour of cigars, which instigated the issue of a new Regulation in 1790. In this, the old method of snuff production, known as the "Losada", that had been the subject of the Regulation of 1761, was re-established. It was also recognised that they had an excessive number of employees, due to the reduced amount of work needed for the level of snuff production. For this reason, many of the installations dedicated to snuff production were re-allocated and converted to suit the production of cigars. Therefore, the principal reason underlying the issue of new Regulations was the need to correct the defects observed and to introduce improvements gained by experience.

The production of snuff and cigars

During the period analysed in this study (1761-1790), two products - snuff and cigars - were produced on he same site. However, each of these activities were carried out in separate, independent workshops termed Factories. These were independent in respect of both the form of organisation and the generation of information, as well as being differentiated in the characteristics of the activities carried out and the labour employed for these activities.

The production of snuff was a complex process that allowed the division of labour. Seven stages of production were required, designated respectively: the "azotea", the "monte", the "moja", the "entresuelos", the "repaso", the fermentation and finally distribution. The first stage of the process involved the exposure of the tobacco leaves to the sun in order to dry them; this was carried out on the roof patio (the azotea) of the Factory building. This phase was done once the newly-arrived shipments had been classified by grade of quality. In the Monte stage (literally, the original heap or pile), the dried tobacco was milled, an initial product of tobacco powder being obtained after sieving to remove the stalks and veins. This powder then passed to the Moja or wetting stage, in which it was mixed with water and other substances, which imparted colour and aroma. In the next stage, the Entresuelos, the powder was spread over the floor (suelo) of darkened, well-aerated rooms, in a process known as oreo or weathering. The Repaso or re-working stage involved a second finer milling. Next, in the Fermentation stage, the final very fine powder was packed in tins of different capacities and then stored in the warehouse of the Distribution operation, from which it was shipped for consumption. The complexity of this production process required a considerable labour-force that was contracted on a daily basis; moreover, the labourers required physical strength to handle the horses (the mills were horse-powered) and to lift the heavy sacks and other containers of tobacco.

The production of cigars was very much a craft activity. First the leaves of tobacco were distributed among the operatives; then each individual worker cut the leaves and rolled them to form the final product, the cigar. This required specialised workers, who were remunerated on a piecework basis.

The regulations and disciplinary control

The disciplinary system that was put into practice in the RFTS was based on a rational distribution of the individual workers in the workspace.2 For this the authorities defined a space closed to the exterior in which the disciplinary system would be applied, thus delimiting the area and the individuals within it who would be subjected to discipline. In this case, the actual building of the RFTS represented the space. It is therefore important to consider the characteristics of its construction: it was a building surrounded by a moat or ditch, and situated at strategic points around the perimeter were look-out posts or checkpoints, manned by a force of security guards (Gutirrez, 1993, p.376).

The physical conditions were complemented by the Regulations issued, which contained obligatory rules assigning a specific place to every individual for the main purpose of identifying who was present or absent from their work, thus constituting a mechanism for monitoring individual behaviour. A good example is offered by the production system for snuff, in which the process was divided into distinct phases, each with a defined space and with a specific allocation of labour; in the case of the fermentation stores and general distribution, this allocation was specified at 20 hands (mozos) and two foremen (tenientes) (1:1761, 5, 16). The various activities apart from the direct productive work were also included in this planning, such as the tasks undertaken in the accounts department: these were assigned a physical space independent of the rest of the activities, and it was forbidden for those working in that department to enter inside the Factories (1:1779, Regulation in respect of the inspector of goods in and out, 20).

This practice made it easier to individual workers subjected to the same obligations, thus also facilitating comparison and differentiation among them. The imposition of a specific spatial arrangement of individuals also extended to regulating the times of entering the Factory each day to work: the first group allowed to enter were the weight inspectors and their deputies, followed by the ordinary workers (peones) of each stage of the productive process, then the craftsmen including carpenters, metalworkers (herreros), stonemasons (picapedreros), fabric workers (empanadores de telas), supervisors of the packaging can workshop, bricklayers and finally the old men (ancianos) (1:1790, Regulation for the good management, finances and policy of the Royal Factories of Snuff and Cigars of Seville, 13, 113).

Another significant feature was the prison that was situated inside the Factory. This was utilised to punish workers who committed serious infractions, and can therefore be considered another space that, by its very function and existence, served to identify, mark out and differentiate those delinquent individuals imprisoned there from the rest. This prison came within the personal jurisdiction of the Factory Superintendent (the executive with ultimate authority in the two Factories).

The spatial distribution of individuals according to their jobs was completed by the definition of an organisational hierarchy in which individuals could be classified by their job category. An example is the various levels or scales of remuneration that enabled individuals to be differentiated not only by the amount of wage they received but also by the length of time for which they were contracted: indefinitely, in the case of the staff and craftsmen, weekly for the cigar rollers, or daily for the operatives of the Snuff Factory.

This detailed regulation that permitted the physical identification of individual workers was also intended to establish acceptable standards of behaviour. Various different aspects of behaviour were considered in the Regulations, from stipulating the correct treatment and use of the equipment, tools and the tobacco, to the ways in which each of the activities, productive or administrative, should be carried out. However there were frequent references to moral behaviour. Allusions can be found to the subordination the workers should show to their superiors; to the need for a conscientious approach to one's work, and to maintaining harmony and good conduct; to the conversations among workers, that were not permitted; to the prohibition of card games at work, of bringing daggers and liquor into the factory, or to the suppression of gambling. Such examples of immoral behaviour serve to paint a picture of potentially rebellious workers, amoral by nature, who contravene the norms if discipline was not imposed.

Another characteristic of any disciplinary system is the articulation of the whole of the company in different elements, that is, the workers as bodies, seeking a perfect synchronisation between the movements and actions of a single body and among all the bodies with each other. Only in this way can the strength exerted individually be combined to obtain the strength of all the individuals as a group, to achieve a result that is more than proportional. It is in this context that discipline in respect of time plays an important role. Time control means not only that the individual should avoid losses of working time due to lack of punctuality or to being absent from his place of work, but also that the time the worker does spend working should be productive, giving good quality results; this means seeking a degree of coordination between time and body so as to allow an adequate work rate to be established. This was reflected in the Regulations regarding the distribution of tasks, since operatives of similar characteristics were required for performing similar work. For example, the old men were in charge of the unbundling of the raw tobacco, and other jobs that did not cause undue fatigue (1:1779, Regulation to be observed henceforth in the office of the Azoteas, 73). In the case of the Snuff Factory, this synchronisation was necessary because it was a line production process that required not only the coordination of the individuals engaged in the same stage of the process but also the coordination of the various different stages. In respect of the Cigar Factory, the objective of achieving a good level of output required that each unit of time should be used productively. Whatever their job, the time the individual was actually present in the factory had to be dedicated to fulfilling his obligations. The payment of the salary or wage had to be justified:

You will make sure that the supervisors ... are not idle and employ the stipulated working hours in the exercise of their responsibilities ... (1:1761, 7, 3).

Sanctions and punishments

Sanctions are what make the individual aware of the consequences of the disciplinary power underlying the rules. They are the specific public manifestation of the disciplinary system, and represent the configuration of the disciplinary authority as power to punish (Fernndez, 1991, p.227). To sanction means to impose a charge, obligation or deprival of a benefit on a person, in this case a worker, for having failed to comply with a collective norm. Its purpose is to avoid a repetition of the non-compliance or infraction, not only by the worker sanctioned but also by the rest of the workforce (Fernndez, 1991, pp.227-32). In the Regulations of the RTFS a variety of sanctions are provided for, to penalise forms of behaviour not acceptable under the rules laid down. The sanctions range from those of the monetary type, through to loss of employment and even imprisonment in Spanish prisons in the country's African colonies.

In respect of the monetary sanctions, the intention behind them was to create a sense of duty in the worker through financial stimulus (Gaudemar, 1991, p.67). In the case of the RFTS, this type of sanction affected those at the lowest levels in the organisation and penalised the loss or incorrect use of equipment and tools in the performance of productive activities. The efficacy of this type of sanction was ensured since it was applied exclusively to those individuals with the lowest wages, thus implying a very considerable valuation for not observing the rules, in terms of high cost/low benefit, for those affected. A representative example was the case of the powder sifters (cernedores) of the "monte" stage of snuff production; their remuneration was set at six reals per day worked, and they were penalised with a fine of two reals if they did not treat the fabric of the sieves carefully enough (Regulation to be observed in the "Monte" section, 47).

Another sanction laid down in the Regulations was dismissal or loss of employment. Historically, dismissal has been the maximum sanction provided in any labour management scheme (Fernndez, 1991, p.247). Below this maximum there are a wide range of options open to the authorities for imposing sanctions appropriate to the offence, as clearly dismissal is considered excessive for less serious infractions. In the case of the RFTS, expulsion from the Factories was ordered for disobedience to superiors, and for not fulfilling obligations. It was also used as a sanction for those workers who repeatedly committed infractions:

Whenever it is discovered in the workshops that the sieved materials have been adulterated ... the Superintendent will be notified, so that a warning can be given for the first time, but if they repeat the offence, their job position will be eliminated and they will be excluded from the Factories for ever ... (1:1761, 7, 11).

It can be deduced from these references that repeated offending was a criterion utilised to assess the moral quality of the individual. It also served to measure the seriousness of the offences committed and to typify a new offence, of a higher order, originated by the accumulation of less serious offences. In this sense, the repetition of offences reflects an atypical configuration of disciplinary power, to the extent to which this, as a general rule, is configured as a mechanism of sanction for unacceptable deeds, for conduct contrary to the rules of the company (Fernndez, 1991,p.l77).

In respect of the punishments laid down in the Regulations, it is notable that it was the sanctions that were subject to a greater degree of arbitrariness. Not only was the correspondence between the sanction and the offence committed not expressly regulated but, in addition, the application of the sanction was left to the decision of the senior levels of management of the organisation:

... the operative who fails to attend work, without these requirements, will be punished at the discretion of the Superintendent and the works managers, depending on the case (1:1779, Regulation to be observed in the Cigar Factory, 61).

In some cases, this arbitrariness goes against the principle of equality that should be sought by any disciplinary system, thus putting its efficacy at risk. Admitting that there could be malice in the behaviour and actions of individuals (judgments left in the hands of the superiors), or the regulation of the correspondence between sanction and offence only for the case of workers at the lowest levels of the organisation, when the offence is not that of theft, provides evidence of an intent to leave a gap in the regulation.

Lastly, another relevant aspect is that the efficacy of the system of sanctions in the RITS was reinforced with additional practices. One of these was the periodical reading of the Regulations to the operatives (1:1761, 11, 97). This was to ensure that the individuals subject to the system knew the rules they had to obey and the particular sanctions that would be imposed for each type of infraction. Thus the workers could not claim ignorance of the rules in their defence, on being accused of breaking them. Also the proportionality between the penalties and the offences was set out explicitly in the Regulations, hence the workers were informed in advance, as an additional means of justifying the possible sanction:

The operatives of the Azoteas will not be permitted to take apart the bags, sacks or wrappings of bales, etc. to makejackets or other clothing ... and those who fail to observe these rules will be notified to the chief inspector (fiel principal) of the Azoteas, so that this can be brought to the attention of the Superintendent, who will apply the corresponding remedy according to the scale of the offence ... (1:1761, 6, 4).

The offence of theft

The direct management of the tobacco monopoly by the Directorate of the Revenue 1730 encouraged smuggling; this increasingly represented competition by making the product available at lower prices, although also of lower quality. This phenomenon has been studied by Rodriguez (1994) but no conclusive results were obtained to reveal the quantitative importance of tobacco smuggling. However, this author also refers to the punishments imposed on the superintendents of the Factory if they were found to be involved in contraband tobacco; the operatives who stole tobacco were also severely punished. These punishments give some perspective on the relevance of the problem.

The theft of tobacco was considered by the Directorate General of the Revenue to be the gravest of all offences, and was penalised by both dismissal and imprisonment. This is the only circumstance in which both the more senior employees and the ordinary operatives were sanctioned in the same way, which emphasises the importance attached by the regulators to this offence:

If any of the employees is apprehended with tobacco that has been removed furtively from the Factories, he will be put in custody, tried and dealt with most severely, and he will receive the same penalty as any operative or simple day labourer ... (1:1779, Regulation to be observed by the Superintendent, 14).

This equality of disciplinary treatment for all the various members of the organisation when the offence was the theft of tobacco or of equipment is significant, especially considering that, in respect of other offences, they received different sanctions for the same infraction depending on whether they were ordinary operatives or employees of the more senior level, known as the Plana Mayor:3

Those who steal linen fabric, equipment or any utensils will be expelled from the Factories (1:1790, Regulation for the good management, finances and policy of the Royal Factories of Snuff and Cigars of Seville, in respect of finances, 29, 237).

No employee of the plana mayor will be able to make use of these (equipment, linen and utensils) for their own personal purposes or to remove them from the premises, and if this is not observed they will be punished by the superintendent (1:1790, idem, idem, 238).

Vigilance against the theft of tobacco required a physical control of the operatives at the time of leaving the Factories through the register or personal inspection. Although initially this control affected a large number of members of the organisation, with the passage of time, a certain degree of relaxation in this practice was observed, and the employees of the Plana Mayor were exempted (1:1779, Regulation in respect of the inspector of entrances, 24). It represented a visible disciplinary practice and consisted of a thorough examination of the operatives' clothing and any part of their body where they could conceal tobacco or other property of the Factories (1:1779, Regulation to be observed by the Superintendent, 14). Performed by the gatekeepers, it was stipulated that the examination would be performed publicly and with witnesses (1:1761, 14, 16), and in this way any sanction resulting from an infraction would be justified and the spread of infractions would be deterred. To make this control more effective, the possibility existed of performing a "counter-inspection" which involved making a second examination of operatives who had already been inspected and passed by another of the gatekeepers; if any tobacco was found in this second examination the first gatekeeper was punished and the person who had performed the second counterinspection could occupy his post (1761, 15, 12). The possibility of filling the vacancy of a slack or corrupt gatekeeper became another mechanism for increasing the efficacy of the disciplinary system, by making rivals of the employees who were equally subject to the system.

Having described the different sanctions, a classification can be made of the offences according to the importance attached to them by the Directorate General of the Revenue. The theft of tobacco or of equipment stands out as the worst offence, incurring the maximum sanction. Second in severity for operatives were disobedience towards their superiors, failure to perform their duties, or showing a tendency to repeat offences. On a third level was the misuse of the equipment utilised in the Factories. On the fourth and least serious level were a series of non-specified forms of misbehaviour that were subject to punishment in general terms; in effect, any behaviour that did not conform to that required by the Regulations.

Rewards for good behaviour

Rewards were established in the Regulations for the lower levels, the operatives, as incentives and a means of publicly recognising various classes of good conduct and establishing patterns of good behaviour:

... the deputies and supervisors of the operatives should be nominated from among the most skilful and hard-working operatives, and by the same order, this invariable rule will be observed with the individuals of the second, third, fourth and fifth pay grade, as well as with the hands of the stores and the Cigar Factory (...) this being the means by which, from the hope of reward, they should apply themselves to gain the advancement that the possession of intelligence may lead them to... (1:1761, 20, 19).

Behaviour that was considered exemplary was rewarded in the RFTS by two procedures: promotions and the possibility of obtaining a higher wage or salary. Promotions of individuals to higher positions were made if their behaviour surpassed what was normally expected of them:

... the Works Manager will make proposals to the Superintendent regarding the persons he believes most suitable to fill vacant posts and as a general rule ... he will give especial consideration to those of outstanding merit, who will be assigned first to the vacancies, over the rest... (1:1790, Regulation for the good management, finances and policy of the Royal Factories of Snuff and Cigars of Seville, in respect of good management, 8, 83).

It is interesting to note that this procedure was used as reward in the counter-inspection, to promote those who identified the gatekeepers permitting tobacco or other utensils to be smuggled out of the Factories (1:1761, 15, 12). The incentive of occupying the post of the guilty gatekeeper strengthened the disciplinary system.

The opportunity of gaining a higher remuneration was linked to achieving a good productive performance, to maintaining the stipulated levels of product quality, and was only applicable in the Cigar Factory where the production of the final product was the responsibility of the individual operative involved:

... the operative (of the Cigar Factory) who exceeds the set number for production (i.e. the target), competently and correctly, will be allocated, in the following week, two pounds of tobacco above the amount usually given to him ... (1:1779, Regulation to be observed in the Cigar Factory, 44).

To summarise, the Directorate General of the Revenue rewarded the trustworthiness of the individual workers when this was not guaranteed for reasons of their job function, as in the case of the counter-inspection, or for the low level they occupied in the hierarchy, such as the ordinary operatives. This explains why promotion to the senior positions (superintendent, accountant or works manager) was not specifically regulated. These appointments, made by the Directorate General of the Revenue, were awarded to persons of recognised value and social position, who were thought more likely to be trustworthy.

The accounting system as discipline

Control over the tobacco itself was exercised by various procedures, and in particular by the accounting system. The information relating to the flows of materials was recorded in credit and debit books, in which accounts were kept of receipts, dispatches (input and output) and stocks of tobacco produced at every stage of the production process. Control over the movements of the tobacco was by means of the credit and debit technique, according to which credits represented all those transactions involving the receipt of material by the "accounting centre", and debits represented all the dispatches or deliveries. Figure 1 constitutes an example of this procedure, in which the summary of credit, debit and calculation of final stocks in the stage of the "Monte and repaso" is detailed. The section corresponding to the "wastes of the department" is also incorporated in this table to quantify the value corresponding to the scraps and remains from the process of cutting or chopping the tobacco. It was important to moisten the tobacco just enough to minimise the losses from the cutting process without affecting the quality of the final product. Turn now to Figure 1 (see over).

The information relating to the movements of tobacco was prepared independently by the person in charge of each stage of the production process, the manager/inspector (fiel), and the books had to be stamped and signed by the accountant. This regulation was very precise in order to avoid confusion, and specified which categories should be considered credits and which debits, in each process stage:

The manager (in this case of the Moja section) must have a bound notebook, the pages of which will be signed by the accountant, in which he will record the credit and debit of the tobacco for which he is responsible. These will be divided into five orders, to account for first the leaf tobacco with the first milling and sieving for producing the best quality, the exquisite grade snuff, second idem for the fine grade, third tobacco powder of "monte de indias" milled and sieved, fourth idem for fine, and fifth for coarse tobacco. In another book, to be similarly signed, these five grades of tobacco must be sub-divided by classes showing with equal separation the precise quantity of each, recording under the credits of the corresponding class the amounts received that comprise this quantity, and under the debits the amounts that are removed for whatever reason ... (1:1779, Regulation to be observed in the "Moja" section office, 4).

The tobacco accounts were kept in duplicate. A parallel set of credit and debit books were kept by the officers of the Accounting department, from the lists of data supplied by the managers, and by the controller (interventor), this latter person being responsible for witnessing and recording the exchanges of tobacco made between the various stages of the snuff production process. This information formed the basis of the accounts and reports sent periodically to the Directorate General of the Revenue. It is important to note that the controller played a relevant role in the verification of the accounting information. Equivalent to an internal auditor, his duties included, among others, the witnessing of all the receipts into and dispatches from the Factory of all tobacco and equipment, recording these in the corresponding books he had to keep. He also had to audit the lists prepared by the heads of each department once these had been checked against the entries that he personally made in the books kept for this purpose. The controller acted as the verifier of the information prepared by others, and represented another control mechanism to which they were subjected.

The credit and debit books were supplemented by the record cards, known as little boards, that had to be placed on the piles of tobacco to give immediate information on the receipts, dispatches and stocks in respect of the piles. Although this information was also recorded in the respective credit and debit books, the use of these cards enabled the operatives also to identify the different consignments. In this way, the Directorate General of the Revenue hoped to avoid errors and facilitate the tasks of control.

But the accounting system not only served to control the internal movements of the raw material, but also the quality of the production. For this purpose, fixed production standards were established that determined the quantities that should be produced in each of the Factories with the objective of maximising efficiency in the use of the raw material. With this stipulation on quantities, there was the obligation of producing according to established product characteristics. From all these rules it can be stated that the production standards served to monitor the productive behaviour of the operatives remotely or at a distance. In other words, the operatives in Seville could be controlled by the Directorate General of the Revenue in Madrid. Two examples taken from the Factories of Snuff and of Cigars respectively illustrate this point:

On this assumption and given that the tobacco must be well milled, sieved and fine, each production machine Supervisor (capataz) must be allocated, on a daily basis and from the first of April to the end of October, a quantity of 250 pounds weight of tobacco leaf, and from the first of November until the end of March, a quantity of 220 pounds (I: 1779, Regulation to be observed in the Monte or milling workshop, 93).

The number of rolled cigars that each operative must deliver duly completed is three for each pound weight of tobacco received, whether Havana or from the Island of Santo Domingo. The managers must take great care that the manufacture of the rolled cigars is legitimate and corresponds to the quality of the leaf and its circumstances, (i.e. that Havana cigars are actually made from Havana leaf, for example ...) (1:1779, Regulation to be observed in the Cigar Factory, 44).

This normalisation of the productive behaviour by means of the standards of production was completed with mechanisms of sanctions to penalise those operatives who did not perform their work as laid down in the Regulations. The following example indicates that the supervisors and assistants of the Monte section could be punished if productive output did not meet specifications:

The senior Supervisors will visit very frequently all the machines and stables, observing that the milling process complies with the corresponding method and good order, that the output from the mortars is correct ... that the siftings after being milled are passed through the hand-operated sieves of cloth before being sieved through those of the trolleys ... that the sieved tobacco is fine and consistent throughout the whole sack ... and that any fault or defect they notice in respect of any of these matters will be reported to First Works Manager ... so that the supervisors and their assistants who have been lax and deficient are duly punished (1:1779, Regulation to be observed in the Monte or milling workshop, 60}.

In the Cigar Factory, unlike that for snuff, the sanction mechanism was through the payment system of piece-work and monitored through the accounting system. The production standards served to verify individually if the operative had manufactured the cigars in accordance with the stipulations given in the Regulations; the penalty was loss of pay by the operative who failed to meet the predetermined specifications:

... this should be done by the method of noting in the lists the number of pounds weight (of leaf) issued to each operative, against the number of rolled cigars produced, and since the quantity of leaf is always the same for each operative, when differences are found in the number of cigars, a most careful examination will be made to discover whether the increased output of one operative is due to more humidity in the material (than permitted). In such cases, a deduction will be made from the earnings of the responsible operative of an amount equal to the cost of making the (defective) cigars (1:176/, 13, 3).

Figure 2 shows the quantities of raw material handed individually to each operative, the output obtained in terms of the numbers of rolled cigars made and the deviations from standard. Turn now to Figure 2 (see over).

In this case there were two teams or "huts", each comprising a leader and a group of operatives working at a table. The leader was placed at one end of the table with the rest of the operatives who were working on a single shift sat around the table. The operators were expected to make 2.7 bunches of cigars per pound of tobacco leaves. The Cigar Trusty was responsible for control of tobacco production and variation analysis. Figure 2 reports positive variations. Arguably, the long period of training of cigar workers (9 months) before entering proper production might ensure the necessary skills to meet production standards.

The accounting system also fulfilled the function of compensating the good productive behaviour of individual operatives. When Cigar Factory workers produced a quantity of cigars in excess of that stipulated, and to the set quality standards, they were "rewarded" with an additional amount of raw material in the following week, thus enabling them to earn more money by making more cigars (1:1779, Regulation to be observed in the Cigar Factory, 44). For this reason, in Figure 2, it can be seen that not all the operatives received the same quantity of tobacco leaf. It is possible that those with greater skill, gained from their experience, would benefit from this possibility, although their higher productivity would be restricted by the need to maintain the quality of the cigar; quality was measured in terms of humidity, because too much humidity would reduce the quality of the product.

The production standards thus served in this case to assess the productivity of the operative in terms of the norm and any deviations from it. They were thus converted into techniques for measuring the efficiency and, indirectly, the conduct of the operative in the respect of productive work.

The setting of standards in respect of efficient utilisation of raw material, together with the credit and debit books, allowed the authorities to have access to information on the productive performance of the two factories, without having physically to be present: to know if this was satisfactory in both quantitative and qualitative terms; to know if the variations in the levels of production established were due to technical factors or to the negligent actions of the operative (for example, whether the increase in the snuff production volume was due to the addition of too much water or to the incorrect milling of the tobacco); to know if the various activities were being performed lazily, with due application, or with enthusiasm; to know if the raw material received and the equipment was being correctly treated; and to be able to compare, identify and differentiate the operatives who participated in the various productive processes, since the deviations from the norms observable from the data recorded provided this detailed evidence. For example:

In the page for the workshop, the amount of leaf credited will be that matching the amount recorded as dispatched from the stores and distributed to the operatives, in the accounts. The amounted debited will be the number of rolled cigars manufactured and dispatched to the distribution store, plus the residues wasted in the manufacturing, and the material destined to be burned (Regulation 1779, Regulation to be observed in the Accounting dept. 53).

By this order, the stocks resulting at the end of each month in the cigar workshop will be known, and any increase that the work in the cigar shop may have produced. At the same time, it will be demonstrated if the operatives have made correct use of the tobacco, as required and specified in the production rules in accordance with what is stated must be done in the cited Regulation4 (Regulation 1779, Regulation to be observed in the Accounting dept., 54).

In this situation, it would be expected that the labour force would be aware of the information that their superiors were going to receive, and of the effects, in form of sanctions, that could result if the production was not satisfactory, either in quality or in quantity, and would adjust their behaviour as required. In effect, the norms would be interiorised, and thus be converted into automatic mechanisms that, jointly, would ensure the achievement of the global objectives.

Analysis and conclusion

In general, it is accepted that the objective of any disciplinary system is to codify, regulate and normalise behaviours (Gaudemar, 1991, p.83). In the case of the company, this means establishing norms of behaviour in relation to the work process and to the treatment and conduct that the individuals (either of the same or different organisational rank) should maintain among themselves when they are inside the factory. This implies the creation of a system of authority, dominance and hierarchy applied to the production.

Although at first sight this is the objective of discipline at work, there exists another more subtle objective: the economic returns sought by the company's owners. The disciplinary system acts to promote this interest also. In other words, the aim of discipline at work is to ensure compliance with the obligations assumed by the "debtor" of the work, the employee (Fernndez, 1991, p.45). This proposition also has relevance within a historical perspective, as shown in the case of the RFTS.

To fulfil this purpose, the normalisation of behaviour is necessary but not sufficient. The application of sanctions and punishments is necessary to prevent undesirable forms of conduct from arising, and to correct any anomalies that do occur. The disciplinary system has the function of straightening out conduct (Foucault, 1992, p.175). When this objective is achieved, in the long term, the result is subjugated and trained bodies, docile bodies (Foucault, 1992, p. 142). In turn, this process contributes to the consolidation of the norm or rule as a mechanism of power, since it gives the capability to impose certain criteria over the rest, regardless of particular characteristics and circumstances. Normalisation or regulation has two advantages for the authorities: on the one hand it is capable of homogenising behaviour and, on the other, it can individualise misbehaviour, indicating and identifying those who break the rules. Thus the disciplinary system is configured as a set of techniques and procedures that permit the authorities to monitor the behaviour and specific actions of individuals and, in consequence, to exercise power over them.

For the case of the RFTS, the proposition was basically the same, although one must take into account that it involved a productive activity undertaken as a monopoly, with the company's owners being the State or Crown, acting through the Tobacco Revenue in this case. Effectively, as stated before, it is the organisational necessities that give rise to the creation of a disciplinary system. It is important to remember that this was a Factory which, in the second half of the eighteenth century, employed around 1,400 workers. Hence in terms of size alone, it was necessary to deploy disciplinary mechanisms for so many individual workers, to remind them at all times and in all situations how they should behave and act, in such a way that over the longer term the workers would adopt the appropriate conduct as a reflex action, having interiorised the rules that were initially imposed on them. In this framework, the fundamental issue was the reaction of each individual to observing the effects, that is, the sanctions, on those who failed to comply with the various norms. The essential principle underlying the system was that of deterrence.

Following the analysis of the various Regulations, it is concluded that the disciplinary mechanism was a system of control during the period of study, 1761-1790. At the external level, the aim was to meet the requirement for control over the tobacco production activity demanded by the Directorate General of the Revenue. At the internal level, the establishment and operation of the disciplinary system had the purpose of deterring the theft of tobacco and maximising the taxation revenues of the Royal Treasury.

Given the circumstances described, the case of the RFTS constitutes a good example of a system designed to produce both goods and individuals. The first, snuff and cigars, in accordance with certain established specifications; the second, hard-working and trustworthy individuals, in function of a moral and productive behaviour adjusted to the objective of maximising revenue.

This is the purpose underlying the issue of the Regulations, and the accounting system contributed to this purpose. There are many aspects of management covered by the Regulations, including rules for the treatment and use to be made of the tobacco and the equipment and tools for its processing, rules on how each of the associated direct productive and indirect administrative functions should be performed, and rules for generally maintaining the relationships and dealings between individuals inside the Factory. The moral aspect was also regulated. In general the classes of behaviour that were normalised in the Regulation are those considered desirable according to the conventions of Spanish society in the eighteenth century. The Regulations also specified the corrective measures to be applied to those not complying.

The accounting system also assisted in normalising, sanctioning and rewarding the productive behaviour of the operatives. The setting of standards for the most productive utilisation of the raw material, together with the keeping of credit and debit books, allowed those in charge of the Factory and the management of the Revenue to determine if the production was satisfactory in quantity and quality. From the accounting data, they were able to compare, identify and differentiate the operatives involved in the various areas of productive work, since the deviations from the established norms were evident from the records. Accounting performed its traditional function of valuing objects and materials goods that intervene in the productive process, like, for example, the raw material. But beyond this, accounting practices were extended and directed towards the assessment of human behaviour, making it possible to take decisions on how to make better use of the physical and human assets within an organisational structure of accountability (Hoskin & Macve, 2000, p.95). In this respect, the case of the RFTS constitutes an example in which accounting fulfills its traditional role but, at the same time, acquires a new significance and takes on a new dimension, that of "Human Accounting" (Hoskin & Macve, 2000, p.96). In addition, the wages paid in the Snuff Factory and the piece-work payments in the Cigar Factory provided the means for imposing financial sanctions for offences against the norms, which strengthened the role of the accounts as an integral part of the disciplinary system.

Accounting, in its new dimension of human accounting, provided both discipline and economic incentives to the operatives at the same time, to make them internalise the objectives of the organisation and to transform them into "governable persons" (Miller & O'Leary, 1987). The evidence from the archives of the RFTS therefore demonstrates that the accounting function contributed to the spirit of the discipline, aimed at ensuring that the behaviour of the individuals complied with that required under the Regulations. The accounts and the accounting procedures made the behaviour of the individuals fit what was considered "right" with respect to the levels of production that had previously been calculated and that justified the wages that the operatives received and the sacrifice this represented for the State in paying them. The kind of knowledge represented by the accounts was transformed into power and translated into assessments, decisions and analyses of the behaviour of the individual workers. The accounting system was converted into a technology of government (Miller & O'Leary, 1987) that participated directly in the coordination and control of the productive process, period after period.

This study demonstrates how the accounting and norms specified in the Regulations were complementary, in order to impose discipline on the productive behaviour of the operatives. However it must be taken into consideration that the capacity of the accounting system as a procedure for controlling and evaluating the individual behaviour of the operatives came to be determined by the characteristics of the productive activities (lvarez et al, 2002, p.271). In concordance with Whitley's (1999, p.521) contentions, different technologies bring about different control mechanisms. Accordingly, division of labour and routine in the snuff factory made it easy to effect the deployment of management by sight. All this, combined with the employment of non-specialised labour in the productive activities, encouraged the development of detailed regulation of the way each of the steps of the productive process should be carried out. The production standards acted as control mechanisms on the use of the raw material. In the case of the cigar Factory, the situation was different. Because this was an activity that required specialised labour to manufacture the product individually from beginning to end, the standards played only a secondary role as a mechanism of control. In this case, the production standards and the piece-work system served to control the raw material and to watch, sanction and reward economically the individual behaviour of the operatives. They essentially initiated the development of management by accounting numbers (Carmona et al, 1997).