Logistics on Home Front and in War


By FREDERICK W. NICHOL, Vice President and General Manager, International Business Machines Corp., New York

Delivered before the Sales Managers' Bureau of the St. Louis Chamber of Commerce, St. Louis, Mo., March 5, 1943

Vital Speeches of the Day, Vol. IX, pp. 362-365.

IT goes without saying that I am deeply grateful to this organization for this handsome gift. I appreciate the gift for itself and in itself, but I appreciate it more for what it represents—for the warm hand of friendship which this organization has seen fit to extend to me—and I assure you that it will always remain one of my cherished possessions. I know you did not do it for that purpose, but I can assure you that no presentation was necessary to prove to me the kindliness and the friendliness of the sales Managers' Bureau of the St. Louis Chamber of Commerce. This souvenir simply cements further our very pleasant and, to me, most enjoyable relationship.

Fresh in my mind is my attendance here at your Fifteenth Annual Sales Executives' Conference in November, 1941, and I cannot tell you how much I regretted my inability to be with you last November.

Most of my previous addresses before sales executives in various parts of the country have been in happier times, and in a happier vein than my speech is going to be tonight. I should like to talk to you about sales, selling and salesmanship, but, by virtue of the fact that we are engaged in an all-out war, that will have to be postponed for a later date. I chose to speak to you tonight instead on "Logistics," a subject which is of vital importance to every man, woman and child, not only in the United States, but in the United Nations.

Elements of War

Warfare is composed of three major elements: Strategy is the planning of warfare. Tactics is the execution of those plans. Logistics, the third branch of military science, is the supplying of everything necessary to strategy and tactics-in the right amount, at the right place, at the right time.

At this point, you might well ask, "What has that got to do with me?" I hope, before I have finished, to impress on you that everything you and I do, say or think now, can have an effect on the outcome of this war, because, while Logistics normally is a military term, in total war; the part played by every citizen, in his daily life and home life, must be regarded in terms of Logistics. Today, Logistics dictates strategy and determines tactics. Logistics can properly be described as the science of survival.

This war, in large part, is a race to make things—and to get them, and the men to use them, to the place where they are needed, when they are needed.

Under-Secretary of War Robert Patterson said recently, "The Army is no less concerned about how well the war is going in the steel mills of Pittsburgh than it is about the developments in the South Pacific."

In his message the other day to General MacArthur, Prime Minister Churchill said, in part, "I have watched with particular admiration your masterly employment of transport aircraft to solve the most complicated and logistical problems." You see, our leaders, on whom we are depending to save civilization, are aware of the importance of this problem of Logistics, and tonight I am trying to bring it down to your life and my life.

Being at war, we cannot take time out to look back and admire our achievements, but we should examine them in the light of what they indicate for the future, and for the lessons they teach.

In his annual address to Congress in January, on the state of the Union, our President gave us an inspiring and detailed account of our extraordinary progress in the production of weapons of war. American business and government, working together, performed prodigious feats of production in 1942, and we are only getting started. They have proved the truth of the dictum, "Something difficult can be done immediately; something impossible takes a little longer.

What was the case a brief year ago with our men in the fighting areas—not only our men, but the other men of the United Nations? As you know, it was simply terrible! They were fighting and hiding in fox holes, mud holes and hell holes, sweating blood in the jungle, and exposed to deadly peril. They were practically unprotected. Why? Mainly because of our inability up to that time to solve a logistical problem.

What is the situation today? Almost wherever these men are, they are in superior positions. They are no longer strictly on the defensive; mainly they are on the offensive. They are protected; they have the means with which to attack and music to their ears is the rumble of our tanks, the zooming of our planes, the crack of our rifles, the roar of our cannon and the bursting of our bombs.

What a different picture as contrasted with that of a year ago! This is so because this nation is well on the way to solving the greatest problem of Logistics which has ever confronted any nation. Our soldiers have proved their mettle under fire and we are fast building up the greatest fighting force in all history.

Democracies, as such, because they comprise so many conflicting elements, are slow in getting started, but their citizens move fast. Democracies have to "tool up," as it were. Those of you who are engaged in manufacturing enterprises, or who know something about manufacturing, know that going through the design and blue-print stages, and "tooling up" processes, is maddeningly slow—but once you are properly "tooled up," production flows. So it has been with our country. We have been going through the blue-print and "tooling up" processes, and we are rapidly becoming "tooled up," both in production and in military senses, and victory is going to flow. When our people become aroused, nothing short of perfection will satisfy them.

While tremendous progress has been made, and is being made in our war effort, there is still the greatest need for vast improvement. This improvement can be accomplished by everyone's paying particular attention to wasted materials, wasted time and wasted effort, each one small in itself, but all of them together adding up to enormous figures.

Here is a simple yet startling fact—one of those simple things we are all prone to overlook: One second lost in every five seconds of time may appear negligible, but it amounts to twenty per cent of the total. Normally we think of time saved in production in terms of lower costs and therefore lower selling prices. Today, the minutes, hours, days and weeks we save are elements of time that will enable us to turn out more guns, more tanks, more planes and more ships. That is how valuable time is. Today, we must think, not of hours and dollars, but of minutes and pennies. We must forget the term "man hours" for the duration, and think in terms of "man minutes."

I should like to give you a homely illustration of what I mean by wasting valuable minutes and much-needed facilities: All of us use the telephone. Did you ever stop to think of the time it takes to say "Hello," then ask, "How are you?", and wait for a reply to that question, instead of jumping right into the conversion?

If the man you are talking to were not all right, he would not be on the telephone. So why ask him? And, anyway, it is too expensive to find out, because wasting just fifteen seconds per call, multiplied by the more than thirty-one billion telephone calls made in the United States in a year, means that over sixteen million full eight-hour days are lost. Loquaciousness is a luxury which we simply cannotafford during this war. We are rationing everything else and I think it is about time we began to ration words.

We have in our business, all through our factories and officers, a sign which reads: "We are at war—talk NET." Here is a clear example of Logistics: As I speak, a shell from an American gun thunders through the jungle. To fire that shot, the countless links in a globe-encircling chain had to be connected. The cartridge case made in Connecticut, the propellant powder in New Jersey, the body of the shell forged in Pittsburgh, machined in Detroit, and filled with explosive charge in Illinois, met at a final assembly point, a fuse and primer manufactured in Missouri. The complete round was transported by rail, truck, ship, plane, and by sweating soldiers, to the firing point—on hand and on time. Multiply that one shell by millions. Then think not only of ammunition but of tanks and planes and guns and ships—food and clothing and shelter—of fuel, repairs and medical supplies!

As the amount of time saved behind the lines is increased, the number of lives lost in the lines is reduced. We must train ourselves to think of every idle machine, every idle man, every idle minute as something subtracted from what we might have done and did not do, and therefore, a direct benefit to the enemy. The minutes and hours a machine stands idle in a manufacturing plant have a definite and deadly relationship to the minutes or hours or days a boy in the front line may be without ammunition, or without the tank or plane support he needs. In one case, it is an unsatisfactory figure on a production report. In the other, lives of American boys are at stake.

The man behind the machine gun must depend upon the man at the machine for his very life. You are not working in munitions plants and you might not think that this applies to you. When I say "at the machine," I am talking right to you, and to every man, woman and child in America. Every one of us, regardless of our vocation or avocation, is a part of the great American war machine. We all must save to serve. The man or woman who saves time or material in his or her business and daily living is contributing definitely toward winning this war. We must all think in those terms.

No one can predict the shape of things to come, but of this fact we are certain—we are living in a changed and changing world. It is always amazing to me how readily, and, 1 think in some cases without really being aware of the fact, humans adapt themselves to change. If I had told you, two years ago when I spoke here—if I had been wise enough to see that far ahead—specifically what changes would occur in the coming two years, and had pictured the American scene as it is today, I would have been shouted down—not literally, of course, because you are too polite, but mentally.

While changes in our mode of living have been forced upon us, we might look upon them in this light: We have been deprived of some things our ancestors never had, and they did a pretty good job of building up this country. We used to walk to reduce and now we are reduced to walking—and that is a good thing.

We should always be prepared for change and we might as well reconcile ourselves now to the fact that we must keep in a constant state of preparedness for change during the rest of our lives. Things are never going to be as they were before, and, as a matter of fact, we do not want them to be; we want them to be and we are going to make them better.

The late Frank Vanderlip once said, "A conservative is a man who does not believe that anything should be done for the first time." That calls for a little cogitation. We aregoing to have to do a lot of things for the first time. Under the pressure of necessity, since December 7, with our backs to the wall, we have learned a great many lessons, and we can look forward with confidence to the fact that, when hostilities have ceased, we shall be prepared to do a better job than has ever been done before.

We must plan to shape our national economic life into a well-balanced mosaic of science, industry, labor, agriculture and government. We must individually develop vision, imagination, and ingenuity to a point never before achieved, if we are going to make the most of the amazing new world of the post-war period.

The last war produced new products which added a billion dollars annually to the American pocketbook. The same thing will happen after this war, but on a vastly more extensive scale. A higher standard of living, higher social and economic standards than have ever before been reached, will be attained.

In considering the state of the world after the war and what we, as businessmen and women, are going to do about it, we must, once and for all, thoroughly learn that the oceans are obsolete, and that we are going to live on each other's doorsteps. We must face the fact that the whole world will be one neighborhood. Domestic problems will be affected by world situations. Whatever happens in one part of the world is going to have some effect on, and there will be repercussions in, every other part of the world.

Under these conditions, it will behoove us to anticipate and know, as well as we can, the happenings in the world which may affect our particular enterprises or our particular jobs, whatever they may happen to be. No longer can we confine ourselves in our thinking to terms of just St. Louis, or Missouri, or our particular businesses or positions. We must think in world terms; we must learn to think internationally, with a realization that this world is going to be closely welded together.

After this war we shall have the broadest and deepest base for an economy of abundance that we have ever had. The job can be stated very simply. We must keep this huge new production plant, which we have built, in operation.

This war has affected our economic structure more profoundly than any other event that ever occurred. We have astounded the world, and surprised ourselves, with our genius for organization under stress, strain and sheer necessity. The American people have been noted for their ability to invent, develop and produce. But, during the brief period we have been in this war, we have uncovered amazing new talents for invention, development and production.

What does all this mean to you as sales executives and salesmen? It is a challenge, a compelling challenge, if there ever was one. It puts it up to you, and I include myself with you, because I always like to think in terms of sales. It puts it right up to us. Our job, yours and mine, after the war will be to match those magnificent accomplishments with our capacity, with our ability and with our talents to sell and to distribute. Without distribution, this mammoth plant which has been built will crumble and our economy will crumble.

Sales management and salesmen are going to be challenged with the greatest opportunity to contribute to world progress, and to distinguish themselves, that the world has ever known, which puts everyone of us in the selling end in an inviable position. The period ahead can be the greatest period in all history, if we are big enough to make it so, and one way to accomplish this will be the way we have built this country—to go back to hard, direct, aggressive selling the moment hostilities cease.

Sales management, good as it has been, and it has been the best in the world, will have to sharpen its vision and expand its leadership, and salesmen and saleswomen will have to sharpen their tools of salesmanship and utilize their talents more effectively than ever before.

Even while we are putting everything we have into the war effort, we must think and plan for the huge tasks which will face us when hostilities cease. Otherwise we will not be true, we will not be loyal to the men who are out there fighting for us, expecting us to prepare a place for them.

We must so lay our plans, by company, by industry and by section of the country, that the transition from a wartime to a peacetime economy will be accomplished smoothly and with a minimum of delay. With proper planning and constructive thinking we can do away with that period of confusion and uncertainty which has always followed the close of a war, and be prepared to enter into the "boom" period which inevitably is to be expected.

America faces a post-war front, a post-war period, more exciting, more exacting and more promising than at any time in the past. Sales managers and salesmen alike must have well thought out plans and programs.

I stated, in effect, that the salesman is going to be a most important factor in the pattern of business after the war. That being the case, he should be given careful consideration, now, in all of our post-war planning.

Those of us who conduct sales organizations must see to it that our sales supervisory system is so organized and so established that our salesmen are directed in such a manner as to enable them to perform a constructive, productive day's work every day.

Of course, from experience, I realize that the best system of supervision, in the world will still contain loopholes. The intelligent salesman, who is honest with himself, knows that the most important type of supervision, and that, incidentally, applies to any line of human endeavor, is self-supervision.

A subject which is being given a lot of consideration today, particularly with the after-the-war period in view, is salesmen's compensation. That is a big subject and time will not permit of my going into it here, but it is being given consideration by forward-looking sales executives.

It is for us now, as sales executives and salesmen, to blueprint the facts and factors which will govern our postwar activities, so that we will be prepared, as individuals, executives and companies, promptly to throw into high gear the great potential distributing machinery of this country. We must always remember, and we must always sell this fact, that anything which helps sales generally, helps the country, and this will be particularly true after the war.

It lies within our power to make the end of this war the beginning of a new and vastly improved era of civilization. We have learned enough from this war to realize that never again can we afford to think in terms of isolating ourselves, because that has held us back. I hope we have learned that, just as among nations we are interrelated, so are we interdependent.

Transportation and communication have changed the face of the globe to a degree which brings us into closer relationship with every other nation on earth—geographically and physically—and that undoubtedly means mentally.

I have dwelt on Logistics and the opportunities of sales management and salesmen in the post-war period. I also have a word to say on a subject which is of vital importance but one which has been sadly neglected. Its neglect throughout the world is responsible for the world being in its present pitiful plight. I refer to human relations.

To make my point, I have to make mention of my own company for a moment, and of our President, Mr. Thos. J. Watson. When he took the reins of management of IBM, some twenty-nine years ago, he immediately put into practice human relations policies which recognized that proper relationships between management and man, and man and man, were paramount, and that, without these, no permanent success could be achieved. That is why we have a Human Relations Department in our company today and in any discussion of any proposition or any problem, the human element is always given first consideration.

If the period following the war is to be as successful as it should be, and as fruitful of the happiness of the peoples of the world as it can be, we need a new type of thinking throughout the world. Recognition must be given to thefact that human rights everywhere must be respected, and that individuals everywhere must be freed from fear and want. They must be educated and encouraged and given the opportunity to lead happy, useful lives. I think that is an obligation which is imposed on every executive in the United States today. In my opinion, there is too much talk and thought devoted to public relations and not enough to human relations.

In closing, I thank you for your fine, warm, cordial reception here tonight, and your attentiveness. I thank the Sales Managers' Bureau again for this lovely gift and for the fine thought behind it. It touched me very deeply and I am going to put St. Louis on my personal map as one of the cities which I must visit with greater frequency from now on. Thank you very much.