Advice to Young Men Entering Business


By MAJOR FREDERICK W. NICHOL, Vice President and General Manager of International Business Machines Corporation

Delivered at Commencement Exercises of Babson Institute, Babson Park, Wellesley Hills, Mass., June 14, 1941

Vital Speeches of the Day, Vol. VII, pp. 668-670.

I FEEL the weight of the responsibility which I assumed when I agreed to address a group of serious young people who are going out to take their places in the business world.

I must say that all of my statements to you today are based on what I know of what has occurred in the past, and what 1 expect will occur in the future. In view of the cataclysmic changes which are taking place in the world, no man today can predict our future state with any degree of accuracy.

In many respects, you young men who are developing yourselves for business careers today are more fortunate than any generation of young men which has preceded you.

Business administration develops in effectiveness, not when everything is going smoothly, but when problems pile up on every side to tax the imagination, resourcefulness and ability of the executive.

Then business, like the individual who has to face adversity, develops character and stamina, initiative and courage.

For the past several years business administration has been thoroughly tested and sorely tried. It has had to face more difficulties—it has been confronted with more new types of obstacles than businessmen have ever had to tackle before. In its struggle to keep its head above water, business has learned not only to stay afloat, but also to swim against the current.

It is, possibly, a radical statement to make, and many sufferers from depressions will not agree with me, but it is my considered opinion that, in the long run, our depressions have promoted rather than retarded our general progress, because they awakened us to realities, and stirred us to action.

You, I, everybody in the world today, is deriving benefits from things which would not be in existence if we had not had our depressions, and if executives had not been literally forced to wake up and think, and create something to overcome depressions and to try to prevent further ones.

I mention depressions only because of what we learned from them, which has undoubtedly been passed on to you young men here, and because they forced us to develop our powers of original thinking—and, as we all know, original thinking is the secret of progress in any human endeavor.

You men who are going into business at this time have not only a recent and valuable experience to draw upon; in addition, you have all the accumulated experience of all previous generations of businessmen.

You are, therefore, in a position to avoid many of the mistakes of the past, and to adopt all of the things which have been tried and found beneficial. This is a wonderful heritage.

With severe depressions in immediate retrospect, you have learned to have no false illusions regarding the permanence of prosperity, either within a given business or industry, a section of the country, or throughout the country as a whole.

You realize, and this is most important, that, simply because business is booming at a given time, there is no certainty that it will continue to remain at its peak; that, in fact, with rare exceptions, a period of unusual prosperity

is followed by reaction, and that, therefore, when things are good, those in business administrative work should be constantly on the alert, and thinking in terms of what should be done to insure stability during the post-boom period.

Today's demands are for "economic realists." I didn't say "economic royalists."

We have heard a great deal of loose talk to the effect that our leaders have failed.

It is simply necessary to review a few simple facts to realize something of what has been accomplished in the short span of our country's history since Civil War days.

At that time industrial workers labored from twelve to fourteen hours a day and in some cases as high as sixteen hours a day, six days a week, for a total of from seventy-two to ninety-six hours a week, at an annual wage of two hundred and eighty-eight dollars. In the eighteen eighties, hours ranged from ten to twelve hours a day, for a total of from sixty to seventy-two hours a week, and the average annual wage was up to three hundred dollars.

In nineteen hundred, hours were down, generally, to ten a day, or sixty a week, and the average annual wage was up to four hundred and twenty-six dollars. Today the hours are down to eight a day, the number of days worked in many industries is five a week, for a total of forty hours a week, and the average annual wage is running at the rate of $1,350. Any time worked in excess of forty hours weekly is overtime, and is paid for accordingly. (Of course, with today's feverish activity, this figure of $1,350 is increasing, but we are in an abnormal period.)

These figures show more eloquently and convincingly than anything I could say that our leaders, in the main, have been promoters of progress, and one of the results of their efforts has been to materially raise the standard of living of all of our people. That is an achievement which fundamentally distinguishes this country and its leaders from those of the rest of the world.

The "American Way" of life is not just a fine phrase. It is a condition. It is another way of saying "the rewards of a democracy."

If you think of all of the comforts, conveniences, and luxuries we enjoy in this country, it becomes abundantly clear how tangible these rewards are, and how definitely worth while they are.

As young men taking up where older men have left off you will have an opportunity and the responsibility and obligations which inevitably go with opportunity of adding your own contributions to our country's progress in the development of this advanced way of life.

I am a staunch believer in the future of this country and in its youth.

It is unnecessary for me to dwell upon the tremendous resources which we possess in our land, and the native ability and zeal of Americans.

There are more frontiers to conquer than existed in your father's or grandfather's day, although they are of a different nature and call for use of the brain rather than of brawn. Research, invention, science, engineering and new discoveries open up new fields and continue to widen opportunities.

When I say "research" I mean product research, market research, methods research—all types of research.

Here is a definition which struck home with me when I first heard it, and which has stayed with me ever since: "Research is to find out what we are going to do when we can't keep on doing what we are doing now." There is no saturation point in opportunities. As always, they will be seized by those who are prepared to seize them—those whose thinking and attitudes are constructive and optimistic. They will be made the most of by those who are willing to pay the price and make the sacrifices which all true success exacts.

I should like to suggest that you do not leave here with the idea of being made president of a big corporation immediately. I am not exaggerating when I say that I have met too many young men during the past few years who thought they were entitled to big executive positions promptly, simply because they had a good scholastic record behind them.

Aim high! Aim at the Presidency! You cannot be too ambitious—but don't expect miracles to happen. They do but not with too great frequency.

It is really a good thing for you and for your ultimate progress that life is as it is—that the worthwhile positions have to be earned, and that they are worth studying, sacrificing and working for.

Of the greatest importance to one who would scale the heights of success in business is an understanding—a warm understanding—of human beings, because it is the human beings with whom you will work—be they under you or over you—who will decide how far you will go, and how long you will last after you get there. Parenthetically, I must remind you that getting there is one thing, and staying there is another. After you win a big position you are going to have to fight to hold it.

The most enlightened, the most intelligent, of our business executives know that the greatest problems with which they have to deal is the personnel problem, involving, as it does, human relations—which can become very involved.

It is with people that ideas are executed. It is with people that plans, policies and principles are carried out. Therefore in business it is people who count most. Personalities are paramount. Men are vastly more important than markets, material, machines or money. This is so for the simple reason that without people of the proper type and training and of the proper spirit your markets, material, your machines, your money, your plans, your policies, your principles, avail you nothing.

Business management is primarily a matter of man management, and, I must add, man-handling. In this matter of people—personnel—men and women—the subject of selection is vital. If you select the right kind of men and women in the first place, assuming that your principles and policies are sound and fair, your personnel problem is greatly simplified, which means that the running of your business is greatly simplified.

Now, if it is important for a corporation to select wisely and well, how much more important is it to you, as an individual, to select with the utmost care the business with which you are going to cast your lot.

I always advise young men seeking employment not simply to look for a job, but to select the type and kind of successful companies that are good enough for them to affiliate themselves with, and then to carefully plan and conduct a campaign, the object of which is to obtain employment in one of the selected companies.

In selecting a company, the main thing to be sure of is that the men at the top—the men who hold the reins ofmanagement—are men of the highest moral character, and that they are men of warm hearts and high ideals. (It is assumed that they have ability, or they would not be at the top.)

I cannot over-stress the importance of this fact to you—and probably, because it is so obvious, it is one which is generally overlooked.

Show me the head of a business enterprise and I will show you the type of person with whom you are to be associated, day in and day out, for the rest of your business life—which today means practically the rest of your life.

Kind attracts kind. Men of the right type naturally surround themselves with people of the right type, and men of the wrong type quite as naturally surround themselves with people of the wrong type.

We are all products of our environment. We are all affected by the people with whom we come in daily contact. We are all a part of all we have met. How vital it is, then, that our working associates—with whom we spend so many of our precious days—be of the finest character—of the fullest caliber—that they be guided by clean ideas and high ideals.

It has been suggested that I might be able to give you a few thoughts as to the kind of men business organizations are looking for as potential executive timber.

No doubt, most of you have already formed conclusions of your own on this subject, based on the biographies of successful men which you have studied, as well as what you have been taught here, and on the contacts you have had and the observations you have made of your own accord.

Successful businessmen combine many qualities and characteristics in varying degrees. Even the specialist, possessing the highest degree of technical skill in his own field, reaches maximum success only as he possesses certain personal traits and qualities.

A few years ago Mr. B. C. Forbes, publisher of "Forbes" magazine, and noted columnist, posed a most interesting question to a group of our giants of industry, including such men as Charles M. Schwab, Alfred P. Sloane, Eugene Grace, Walter Chrysler, and Thomas J. Watson. He asked what was the most important—the most valuable—the most desirable quality of all in a man. The answers included: Courage; Loyalty; Honesty; Industriousness; Integrity; Reliability; Intelligence.

The one quality on which these business leaders all agreed as being the most important single quality was the quality of character. Character has been defined as being like an inward and spiritual grace, of which reputation is, or should be, the outward, visible sign. Without it all the other fine qualities, or education and other advantages which a man may possess, will be worthless to him.

Character, like an actual structure, is built. It may be said that the building of one's character starts even before birth. Certain hereditary qualities are bequeathed to us by our forebears. This inheritance is supplemented, or augmented, by the teachings, precepts and examples of our parents. They profoundly influence the habits we form during the impressionable years of childhood. These habits are important factors in shaping the course of our lives, and in the development of character.

From our homes We go to school, and you men here are fortunate enough to have come to the Babson Institute. At school we come under the influence of our teachers, who try to teach us good habits, and to build up our character, but when we take the next big step, which you are about to take, leaving the shelter of home and school to enter the world of business, we find that we must stand on our own feet. Our future is now pretty much out of the hands of ourparents and teachers. We must make our own decisions, and shape our own destinies.

Dr. Nicholas Murray Butler has said that there are two things without which no man can ever hope to have an education, and those two things are: character and goodmanners.

I should like to speak of another qualification for success which, from my observation, cannot be emphasized too strongly, or too often. That is the willingness and ability to think, and I must admit, as I say this, that thinking is the hardest work in the world.

Mental lethargy is the rock upon which most promising careers are wrecked.

Thinking is something we must do by ourselves. No man ever attained greatness who did not think for himself. It is possible to get by for a while by letting someone else do your thinking for you. Getting by is one thing—getting ahead is quite another.

Now, what kind of world are you about to face? In your lifetime you have heard a great deal of pessimism about the state of the Union and of the world generally, and with good reason, but we have been hearing the same pessimistic predictions since the world began.

Ralph Waldo Emerson, in his essay, "The Conservative," written in 1841, just a hundred years ago, divided the world and individual nations into two parties—the party of Conservatism and that of Innovation. "The battle of patrician and plebeian," he wrote, "of parent state and colony, of old usage and accommodation to new facts, of the rich and the poor, reappears in all countries and times. . . . On rolls the old world meantime, and now one, now the other, gets the day, and still the fight renews itself as if for the first time, under new names and hot personalities."

As long as we are apparently always to have the parties of Conservatism and Innovation with us, it is for you young men to decide on which side you will align yourselves.

When I think of conservatism, I like to think of the late Frank Vanderlip's definition of a conservative. "A conservative," he said, "is a man who does not think that anything should be done for the first time."

If we were to list all of the things which we enjoy today because of the Innovationists who have preceded us, and then pictured the world as it would be without the changes which they have wrought, we would find ourselves back at the beginning of things, with our only comforts and conveniences those which unharnessed nature provides.

There is no mystery about the course we should take.

The reason we have not solved some of our problems is that too many people think along certain specific lines—in a groove, so to speak. That is where you young men can be of tremendous assistance—applying your fresh viewpoint to the old problems, and directing our thinking into new channels.

I urge you not to have any preconceived ideas about some of the things you know you will face. Keep the windows of your minds open.

There is nothing absolute in business—nothing that does not change. The altering trend of business must be considered. For business is constantly changing, and every change demands an equivalent compensation and adjustment.

Changing tastes, inventions, discoveries, new modes and conditions of living—all bring with them new requirements, and that spells progress.

I mentioned research previously, and now I wish to stress it, because I am firmly convinced that our problem in this country has never been one of over-production, but of underconsumption.

The only way we can create wealth is by keeping people busy—by production—and then by selling that production.

Research can show us ways to reduce the cost of our products, so that they can be brought within the reach of more people, and thus increase consumption.

I have not attempted to discuss here the more technical phases of business administration. I know that at Babson Institute you have made a comprehensive study of those aspects of the work for which you have been fitting yourselves. But I should like to dwell for a moment on one very important requisite of good management.

Among the significant trends of recent years is the increasing appreciation of the importance of facts.

In your studies here at Babson you have learned what every executive knows from experience—that knowledge is power, and guess-work is disastrous.

The slogan, "Don't Guess—Know," sums up in three words a rule which every potential executive should place near the head of his list.

The young businessman should make up his mind that he will never take anything for granted—that before he makes decisions he will get all the facts and base his decisions upon his interpretation of those facts.

I know that this will not apply to you, but I have seen too many young men in business aiming at nothing and hitting it. I have seen too many who are guided by "stop" signs within themselves, instead of "go" signs.

There is no reason why every one of you young men, with the great advantages which you enjoy, should not carve out signally successful careers for yourselves.

There is one point I must make. Regardless of how well informed you may be, regardless of how brilliant you may be, regardless of your background, if you are to succeed—and every one of you can and should succeed—you must continue to study, and you must work hard. You cannot escape that old, cold, hard fact.

As I stated at the beginning of this talk, the present world situation is far too complicated for any one of us to make predictions regarding the future. All we can hope to do is to use our best judgment in all circumstances, acting promptly, but always after proper and mature thought.

We must learn to do the things we should do, and to avoid the things we should not do. This is very simply expressed, but it contains a world of meaning.

Victor Hugo said, "Short as life is, we make it still shorter by the careless waste of time." None of us lives more than twenty-four hours a day, seven days a week, twelve months a year. Every waking hour is made up of precious minutes which we live but once.

While we are alive, each of us has as much time as the other fellow. There is no competition in this respect. But there is competition for the high places to which you aspire, and the use you make of your time will determine where you will be ten, twenty, or thirty years from now.

Unless the form of civilization which we represent, changes—and I am not one who thinks it will—you young men, with the greater part of your lives before you, face a wonderful future. You have a better opportunity for accomplishment than any preceding generation has ever had.

There are scores of new fields of activity which were unheard of a few years ago, and present and future circumstances will bring more.

The demand for brains is constantly multiplying. The young men of today, as I have stated, has more to start with, a better accumulation of knowledge, is better trained and prepared, and can go farther, more quickly, than in any previous time in the history of the world.

All of you who are of the right character and who are willing to make the necessary sacrifices for success will achieve it.