Increasing Efficiency In Business
Walter Dill Scott

Part 2 out of 6

photographs reproduced in the house bulletin.
This honor and publicity was the chief reward
received by the great majority of contestants,
and was adequate. Minor prizes were offered
on conditions, allowing a large number to qualify,
and tempting virtually everybody to make
an effort to win one. The value of the prizes
did not need to be great, for each man was
impressed with the idea that his comrades were
watching him, that they observed every advance
or retrogression. Success in the contest
meant ``making good'' in the eyes of the
other salesmen as well as in the eyes of his

_This desire for social approval and the spirited
comment of the editor had a marked influence
on the efficiency of many of the younger

These special contests were conducted
chiefly during the ``rush'' seasons, when
activity and efficiency of salesmen meant
greater returns to the house. Because of
their varied forms the contests did not become
monotonous, and thus fail in their effect.
During the three or four ``big'' selling months
when special quotas were announced, an individual
pocket schedule was mailed to each
man, showing how much business he must close
each day to keep pace with ``Mr. Quota,'' the
constant competitor.

_The most industrious and ambitious men are
stimulated by competition; with the less industrious
such a stimulation is often wonder working
in its effects_.

For many positions in the business world a
hypothetical bogy should be created after the
style of the quota referred to above.

To increase the feeling of comradeship and

promote coperation between the men the
entire organization or single sections of it
occasionally should be made the unit of competition.
This is perhaps the most helpful
form of competition, but it is hard to execute.

Valuable prizes should always be given to
the winners. This ``need'' may not necessarily
be monetary.

Promotion should not depend upon success
in contests, but such success may be well
reckoned in awarding promotions.

Public commendation for success in competition
costs the company little and is greatly
appreciated by the winner. There seems to
be no reason why the head of the house should
not assist in the presentation.

The most essential factor in creating interest
in a contest is the skill of the ``sporting
editor'' in injecting the real spirit of the
game into each contest, thus securing wide
publicity, and enlisting the coperation of
large numbers of participants.

Prizes should be widely distributed, so that
the greatest number may be encouraged.

A fair system of handicapping should be
adopted in every case where equal opportunity
to win is not possessed by all. Previous records
often make successful bogies, and should be
more extensively employed.

It is possible to carry on contests between
individuals in the same department without
jealousies, but skill is required to conduct
them. There is the danger that individuals
will seek to win by hindering others as well
as by exerting themselves. Where it is not
possible to carry on a contest and retain a
feeling of comradeship between the men, no
competition should be encouraged.




DELAYED by a train of accidents, a
big contractor faced forfeiture of his
bond on a city tunnel costing millions
of dollars. He had exhausted his ingenuity
and his resources to comply with the terms of
his contract, but had failed. Because public
opinion had been condemning concessions on
other jobs on flimsy grounds, the authorities
refused to extend the time allowed for completing
the work. By canceling the contract,
collecting the penalty, and reletting the task,
the city would profit without exceeding its
legal rights.

In his dilemma, he called his foremen
together and explained the situation to them.
``Tell the men,'' he said. Many of these

had been members of his organization for
years, moving with him from one undertaking
to the next, looking to him for employment,
for help in dull seasons or in times of misfortune,
repaying him with interest in their
tasks and a certain rough attachment.

He had been unusually considerate, adopting
every possible safeguard for their protection,
recognizing their union, employing three shifts
of men, paying more than the required scale
when conditions were hard or dangerous.

A score of unions were represented in the
organization: miners, masons, carpenters,
plasterers, engineers, electricians, and many
grades of helpers. Learning his plight, they
rallied promptly to his aid. They appealed
to their trades and to the central body of
unions to intervene in his behalf with the city

_How One Considerate Employer was protected
by his Men_

As taxpayers, voters, and members of an
organization potentially effective in politics,

they approached the mayor and the department
heads concerned. They pointed out--
what was true--that the city's negligence in
prospecting and charting the course of the
tunnel was partly responsible for the contractor's
failure. They pleaded that the city
should make allowances rather than interrupt
their employment, and that the delay in the
work would counterbalance any advantage
contingent on forfeiture. They promised also
that if three additional months were given the
contractor, they would _*do all in their power to
push construction_.

The mayor yielded; the extension was
granted. And the men made their promise
good literally, waiving jealously guarded rights
and sparing no effort to forward the undertaking.
The miners, masons, carpenters, and
specialists in other lines in which additional
skilled men could not be secured labored frequently
in twelve-hour shifts and accepted
only the regular hourly rate for the overtime.
With such zeal animating them, only one conclusion
was possible. The tunnel was entirely

completed before the ninety days of grace had

Here was loyalty as stanch and effective
as that which wins battlefields and creates
nations. It increased the efficiency of the
individual workers; it greatly augmented the
effectiveness of the organization as a whole.
It was developed, without appeal to sentiment,
under conditions which make for division
rather than coperation between employer
and employee. The men were unionists;
wages, hours, and so on, were contract matters
with the boss. Yet in an emergency, the tie
between the tunnel builder and his men was
strong enough to stand the strain of the fatiguing
and long-continued effort necessary
to complete the job and save the former from
ruin. Like incidents, on perhaps a smaller
and less dramatic scale, are not uncommon;
but the historian of business has not yet risen
to make them known.

_Loyalty, to Nation or Organization, shows itself
in an Emergency_

As with patriotism, business loyalty needs
some such crisis as this to evoke its expression.
In peace the patriotism of citizens is
rarely evident and is frequently called in
question. In America we sometimes assume
that it is a virtue belonging only to past
generations. But every time the honor or
integrity of the country is threatened, a multitude
of eager citizens volunteer in its defense.
Likewise, many a business man who has
come to think his workmen interested only in
the wages he pays them, discovers in his hour
of need an unsuspected asset in their devotion
to the welfare of the business, and their willingness
to make sacrifices to bring it past the
cape of storms.

Study of any field, of any single house, or
of any of the periods of depression which have
afflicted and corrected our industrial progress,
will convince one of the unfailing and genuine
loyalty of men to able and considerate em-

ployers. So generally true is this, indeed, that
``house patriotism,'' ``organization spirit,'' or
``loyalty to the management'' is accepted
by all great executives as one of the essential
elements in the day-by-day conduct of their

Striking exhibitions of this loyalty may wait
for an emergency. Unless it exists, however,
unless it is apparent in the daily routine, there
is immediate and relentless search for the
antagonistic condition or method, which is
robbing the force of present efficiency and
future power. Coperation of employees is
the first purpose of organization. Without
loyalty and team work the higher levels in
output, quality, and service are impossible.

_Loyalty on Part of Employer begets Loyalty in
his Workers_

The importance of loyalty in business could
not readily be overestimated, even though its
sole function were to secure united action on
the part of the officers and men. Where no
two men or groups of men were working to

counter purposes, but all are united in a common
purpose, the gain would be enormous, even
though the amount of energy put forth by the
individuals was not increased in the least.
When to this fact of value in organized effort
we add the accompanying psychological facts
of increased efficiency by means of loyalty,
we then begin to comprehend what it means
to have or to lack loyalty.

The amount of work accomplished by an
individual is subject to various conditions.
The whole intellect, feeling, and will must work
in unity to secure the best results. Where
there is no heart in the work (absence of
feeling) relatively little can be accomplished,
even though the intellect be convinced and the
will strained to the utmost. The employee
who lacks loyalty to his employer can at least
render but half-hearted service even though
he strive to his utmost and though he be convinced
that his financial salvation is dependent
upon efficient service. _The employer who
secures the loyalty of his men not only secures
better service, but he enables his men to accomplish_

_more with less effort and less exhaustion_. The
creator of loyalty is a public benefactor.

Such loyalty is always reciprocal. The
feeling which workmen entertain for their
employer is usually a reflection of his attitude
towards them. Fair wages, reasonable hours,
working quarters and conditions of average
comfort and healthfulness, and a measure of
protection against accident are now no more
than primary requirements in a factory or
store. Without them labor of the better,
more energetic types cannot be secured in the
first place or held for any length of time.
And the employer who expects, in return for
these, any more than the average of uninspired
service is sure to be disappointed.

If he treats his men like machines, looks
at them merely as cogs in the mechanism
of his affairs, they will function like machines
or find other places. If he wishes to stir
the larger, latent powers of their brains and
bodies, thereby increasing their efficiency
as thinkers and workers, he must recognize
them as men and individuals and give in

some measure what he asks. He must identify
them with the business, and make them
feel that they have a stake in its success and
that the organization has an interest in the
welfare of its men. The boss to whom his
employees turn in any serious perplexity or
private difficulty for advice and aid is pretty
apt to receive more than the contract minimum
of effort every day and is sure of devoted
service in any time of need.

_The Effect of Personal Relations in creating
Loyalty in a Force_

It is on this personal relationship, this platform
of mutual interests and helpfulness, that
the success and fighting strength of many one-
man houses are built. As in the contractor's
dilemma already cited, it bears fruit in the
fighting zeal, the keener interest, and the extra
speed and effort which workers bring to bear
on their individual and collective tasks. All
the knowledge and skill they possess are
thrown into the scale; their quickened intelligences
reach out for new methods and short

cuts; when the crisis has passed, there may be
a temporary reaction, but there is likely to be
a permanent advance both in individual efficiency
and organization spirit.

On the employer's side, this feeling is expressed
in the surrender of profits to provide
work in dull seasons; in the retention of
aged mechanics, laborers, or clerks on the
payroll after their usefulness has passed;
in pensions; in a score of neighborly and
friendly offices to those who are sick, injured,
or in trouble. A reputation for ``taking care
of his men'' has frequently been a bulwark of
defense to the small manufacturer or trader
assailed by a greedy larger rival.

Personality is, beyond doubt, the primitive
wellspring of loyalty. Most men are capable
of devotion to a worthy leader; few are
ever zealots for the sake of a cause, a principle,
a party, or a firm. All these are too abstract
to win the affection of the average man. It is
only when they become embodied in an individual,
a concrete personality which stirs our
human interest, that they become moving

powers. The soldiers of the Revolution fought
for Washington rather than for freedom;
Christians are loyal to Christ rather than to
his teachings; the voter cheers his candidate
and not his party; the employee is loyal to the
head of the house or his immediate foreman
and not to the generality known as the House.
Loyalty to the individuals constituting the
firm may ultimately develop into house loyalty.
To attempt to create the latter sentiment,
however, except by first creating it for
the men higher up is to go contrary to human
nature--always an unwise expenditure of

_Human Sympathy as a Factor in developing
Loyalty in Men_

In developing loyalty, human sympathy is
the greatest factor. If an executive of a
company is confident that his directors approve
his policies, appreciate his obstacles,
and are ready to back him up in any crisis,
his energy and enthusiasm for the common
object never flag. If department heads and

foremen are assured that the manager is
watching their efforts with attention and regard,
approving, supporting, and sparing them
wherever possible, they will anticipate orders,
assume extra burdens, and fling themselves
and their forces into any breach which may
threaten their chief's program.

If a workman, clerk, or salesman knows that
his immediate chief is interested in him personally,
that he understands what service is
being rendered and is anxious to forward his
welfare as well as that of the house, there is
no effort, inconvenience, or discomfort which
he will not undertake to complete a task which
the boss has undertaken. Throughout the
entire organization, the sympathy and coperation
of the men above with the men below
is essential for securing the highest degree of
loyalty. No assumed or manufactured sympathy,
however, will take the place of the genuine

_Personal Relationship with Workers as Basis
for creating Loyalty_

The effectiveness of human sympathy in
creating loyalty is most apparent in one-man
businesses where the head of the house is in
personal contact with all or many of his employees.
This personal touch, however, is
not necessarily limited to the small organization.
Many men have employed thousands
and secured it. Others have succeeded in impressing
their personalities, and demonstrating
their sympathy upon large forces, though
their actual relations were with a few. The
impression made upon these and the loyalty
created in them were sufficient to permeate and
influence the entire body. Potter Palmer, the
elder Armour, Marshall Field, and Andrew Carnegie
were among the hundreds of captains
who made acquaintance with the men in the
ranks the cornerstone on which they raised
their trade or industrial citadels.

When the size of the organization precludes
personal contact, or when conditions remove

the executive to a distance, the task of maintaining
touch is frequently and successfully
intrusted to a lieutenant in sympathy with
the chief's ideals and purposes. He may
be the head of a department variously styled,
--adjustments, promotion and discharge,
employment, labor,--but his express function
is to restore to an organization the simple
but powerful human relation without which
higher efficiency cannot be maintained. In
factories and stores employing many women
this understudy to the manager is usually a
woman, who is given plenary authority in the
handling of her charges, in reviewing disputes
with foremen, and in finding the right position
for the misplaced worker. Whether man
or woman, this representative of the manager
hears all grievances, reviews all discharges,
reductions, and the like, and makes sure that
the employee receives a little more than absolute

Many successful merchants and manufacturers,
however, disdain agents and intermediaries
in this relation and are always ac-

cessible to every man in their organizations;
holding that, since the coperation of employees
is the most important single element in
business, the time given to securing it is time
well spent.

Even though human sympathy may well
be regarded as the most important consideration
in increasing loyalty, it is not sufficient
in and of itself. The most patriotic citizens
are those who have, served the state. They
are made loyal by the very act of service.
They have assumed the responsibility of promoting
the welfare of the state, and their
patriotism is thereby stimulated and given
concrete outlet. A paternalistic government
in which the citizens had every right but no
responsibility would develop beggars rather
than patriots.

Similarly in a business house ideally organized
to create loyalty, each employee not
only feels that his rights are protected, but
also feels a degree of responsibility for the
success and for the good name of the house.
He feels that his task or process is an essen-

tial part of the firm's activity; and hence is
important and worthy of his best efforts. To
cement this bond and make closer the identification
of the employee with the house many
firms encourage their employees to purchase
stock in the company. Others have worked
out profit-sharing plans by which their men
share in the dividends of the good years and
are given a powerful incentive to promote
teamwork and the practice of the economies
from which the overplus of profit is produced.

_Loyalty may be developed by Education in House
History and Policies_

The stability of a nation depends on the
patriotism of its citizens. Among methods
for developing this patriotism, _*education_ ranks
as the most effective. In the public schools
history is taught for the purpose of awakening
the love and loyalty of the rising generations.
The founders, builders, and saviors of the country,
the great men of peace and war who have
contributed to its advancement, are held up
for admiration. From the recital of what

country and patriotism meant to Washington,
Jefferson, Lincoln, Grant, and a host of lesser
heroes, the pupils come to realize what country
should, and does, mean to them. They
become patriotic citizens.

_Grounding the New Employee in Company
Traditions and Ideals_

In like manner the history of any house can
be used to inspire loyalty and enthusiasm
among its employees. Business has not been
slow to borrow the methods and ideals of
education, but the writer has been unable to
discover any company which makes adequate
use of this principle. That this loyalty may
be directed to the house as a whole, and not
merely to immediate superiors, every employee
should be acquainted with the purposes and
policies of the company and should understand
that the sympathy which he discovers in
his foreman is a common characteristic of the
whole organization, clear up to the president.
The best way to teach this is by example--
by incidents drawn from the past, or by a

review of the development of the company's

To identify one's self with a winning cause,
party, or leader, also, is infinitely easier than
to be loyal to a loser. For this reason the
study of the history of the firm may well include
its trade triumphs, past and present;
the remarkable or interesting uses to which its
products have been put; the honor or prestige
which its executives or members of the
organization have attained; and the hundred
other items of human interest which can be
marshaled to give it house personality. All
this would arouse admiration and appreciation
in employees, would stir enthusiasm and
a desire to contribute to future achievements,
and would foster an unwillingness to leave the

Some companies have begun in this direction.
New employees, by way of introduction,
listen to lectures, either with or without
the accompaniment of pictures, which review
what the house has accomplished, define its
standing in the trade, analyze its products and

their qualities or functions, sketch the plan and
purpose of its organization, and touch upon the
other points of chief human interest. Other
companies put this information in booklets.
Still others employ their house organs to recall
and do honor to the interesting traditions of
the company as well as to exploit the successful
deeds and men of the moment. An organized
and continuous campaign of education
along this line should prove an inexpensive
means of increasing loyalty and efficiency
among the men. To the mind of the writer, it
seems clear that the future will see pronounced
advances in this particular.

Personality can be overdone, however.
Workers instinctively give allegiance to strong,
balanced men, but resent and combat egotism
unchecked by regard for others' rights.
Exploitation of the employer's or foreman's
personality will do more harm than good unless
attended by consideration for the personality
of the employee. The service of more than
one important company has been made intolerable
for men of spirit and creative ability

by the arrogant and dominating spirit of the
management. The men who continue to
sacrifice their individuality to the whim or the
arbitrary rule of their superiors, in time lose
their ambition and initiative; and the organization
declines to a level of routine, mechanical
efficiency only one remove from dry-

_How Efficiency and Loyalty of Workers may be

Conservation and development of individuality
in workers may be made an important
factor in creating loyalty as well as in directly
increasing efficiency. Great retail stores put
many department heads into business for
themselves, giving them space, light, buying
facilities, clerks, and purchasing and advertising
credit as a basis of their merchandising;
then requiring a certain percentage of profit
on the amount allowed them. The more successful
of Marshall Field's lieutenants were
taken into partnership and, as in the case of
Andrew Carnegie and his ``cabinet of young

geniuses,'' were given substantial shares of the
wealth they helped to create.

Some industries and stores carry this practice
to the point of making specialized departments
entirely independent of the general
buying, production, and selling organizations
whenever these fall short of the service offered
outside; while the principle of stock distribution
or other forms of profit sharing has
been adopted by so many companies that it
has come to be a recognized method of promoting

Regard for the employee's personality must
be carried down in an unbroken chain through
all the ranks. It may be broken at any step
in the descent by an executive or foreman
who has not himself learned the lesson that
loyalty to the house includes loyalty to the
men under him.

It is not uncommon, in some American
houses, to find three generations of workers
--grandfather, father, and apprentice son--
rendering faithful and friendly service; or to
discover a score of bosses and men who have

spent thirty or forty years--their entire
productive lives--in the one organization.
Where such a bond exists between employer
and employees, it becomes an active, unfailing
force in the development of loyalty, not only
among the veterans, but also among the newest
recruits for whom it realizes an illustration of
what true coperation means.

_Many Examples of the Loyalty of Executives for
their Men in Danger_

This double loyalty--to the chief and to
the organization--is not a plant of slow
growth. Few mine accidents or industrial
disasters occur without bringing to merited,
but fleeting, fame some heroic superintendent
or lesser boss who has risked his own life to
save his men or preserve the company's
property. The same sense of responsibility
extends to every grade. Give a man the
least touch of authority and he seems to take
on added moral stature. The engineer who
clings to his throttle with collision imminent
has his counterparts in the ``handy man''

who braves injury to slip a belt and save
another workman or a costly machine, and in
the elevator conductor who drives his car up
and down through flames and smoke to rescue
his fellows. Such efficiency and organization
spirit is the result of individual growth as well
as the impression of the employer's personality
upon his machine.

_A Disloyal Sales Manager and his Influence on
his Force_

On the other hand, lack of loyalty on the
part of employers towards their men is almost
as common as failing devotion on the part of
workers. Too many assume that the mere
providing of work and the payment of wages
give them the right to absolute fidelity, even
when they take advantage of their men. The
sales manager concerned in the following incident
refused to believe that his attitude
towards his men had anything to do with the
lack of enthusiasm and low efficiency in his

An experienced salesman who had lost his

position because of the San Francisco fire
applied to the sales manager for a position.
He was informed that there were fifteen applicants
for the Ohio territory, but that the
place would be given to him because of his
better record. The manager laid out an
initial territory in one corner and ordered the
salesman to work it first.

Working this territory, the salesman secured
substantial orders, but refrained from
``over-selling'' any customer, gave considerable
time to missionary work and to cultivating
the acquaintance of buyers. His campaign
was planned less for immediate results
than for the future and for the effect on the
larger field of the state. Having no instructions
as to pushing his wider campaign, in
about sixty days he asked for instructions.
In answer he was ordered home and discharged
on the ground that business was dull and that
he had been a loss to the house. During the
sixty days he had been working on a losing
commission basis with the expectation of
taking his profits later. Investigation dis-

closed that he was but one of five salesmen to
whom the Ohio territory had been assigned
simultaneously. Of the five, one other also
had made good and had been retained because
he could be secured for less money.

This multiple try-out policy is entirely
fair when the applicants know the conditions.
But to lead each applicant to believe that he
has been engaged subject only to his ability
to make good is manifestly unjust. The facts
are bound to come out sooner or later and
create distrust among all employees of the
house. Loyalty is strictly reciprocal. If an
employee feels that he has no assurance of
fair treatment, his attitude towards the firm
is sure to be negative. Even the man who
secures the position will recognize the firm's
lack of candor and will never give his employers
the full measure of coperation which produces
maximum efficiency.

The ``square deal,'' indeed, is the indispensable
basis of loyalty and efficiency in an
organization. The spirit as well as the letter
of the bargain must be observed, else the work-

men will contrive to even up matters by loafing,
by slighting the work, or by a minimum production.
This means a loss of possible daily
earnings. On the other hand, employees never
fail to recognize and in time respect the executive
who holds the balance of loyalty and justice
level between them and the business.

Fair wages, reasonable hours, working quarters
and conditions of average comfort and
healthfulness, ordinary precautions against
accidents, and continuous employment are
all now regarded as primary requirements
and are not sufficient to create loyalty in the
men. More than this must be done.

The chief executive should create such a
spirit that his officers shall turn to him for
help when in perplexity or difficulty. The
superintendent and officers or bosses should
sustain this same sympathetic relationship
toward their men that the executive has toward
his officers. A reputation for taking care of
his men is a thing to be sought in a chief
executive as well as in all underofficers.

Personal relationships should be cultivated.

In some large organizations the chief executive
may secure this personal touch with individuals
through an agent or through a department
known as the department of ``promotion and
discharge,'' ``employment,'' or ``labor.'' In
others, occasional meetings on a level of equality
may be brought about through house picnics,
entertainments, vacation camps, and so
on, where employer and employee meet each
other outside their usual business environment.

It is not worth while to attempt to develop
loyalty to the house until there has been
developed a loyalty to the personalities
representing the house. Loyalty in business is
in the main a reciprocal relationship. The
way to begin it is for the chief to be loyal to
his subordinates and to see to it that all officers
are loyal to their inferiors. When loyalty
from above has been secured, loyalty from the
ranks may readily be developed.

The personality of the worker must be
respected by the employer. ``Giving a man
a chance'' to develop himself, allowing him

to express his individuality, is the surest way
of enlisting the interest and loyalty of a
creative man.

To identify the interests of employees with
the interests of the house, various plans of
profit sharing, sale of stock to employees,
pensions, insurance against sickness and accident,
and so on, have been successfully applied
by many companies.

So far as possible, responsibility for the
success of the house should be assumed by
all employees. In some way the workmen
should feel that they are in partnership with
the executives. We easily develop loyalty
for the cause for which we have taken responsibility
or rendered a service.

_Creating Loyalty to Firm itself by Educational

A perpetual campaign of publicity should be
maintained for the benefit of every man in the
employ of the house. In this there should be
a truthful but emphatic presentation of acts
of loyalty on the part of either employers or

workmen. Everything connected with the
firm which has human interest should be included
in this history. This educational campaign
should change the loyalty to the _*men_
in the firm into loyalty to the _*firm_ itself. It
should be an attempt to give the firm a personality,
and of such a noble character that it
would win the loyalty of the men. This could
be accomplished at little expense and with
great profit.




THE owner of one of the largest and most
complex businesses in America handles
his day's work on a schedule as exacting
as a railway time-table. In no other way
could he keep in touch with and administer
the manifold activities of his industry and a
score of allied interests--buying of the day's
raw materials for a dozen plants in half as
many markets, direction of an organization
exceeding 20,000 men, selling and delivering
a multitude of products in a field as wide as
three continents, financing the whole tremendous

Every department of his business, therefore,
has its hour or quarter hour in the daily program
when its big problems are considered

and settled on the tick of the clock. This
schedule is flexible, since no two days bring
from any division of production, distribution,
or financing the same demands upon the owner's
attention. Yet each keeps its place and
comes invariably under his eye--through
reports and his own mastery of conditions
affecting the department.

_To secure the high personal efficiency required
for this oversight and methodical dispatch of
affairs, the owner-executive is not only protected
from outside interruptions and distractions, but is
also guarded against intrusion of the vital
elements of his business--both men and matters
--except at the moment most advantageous for
dealing with them_.

Analysis and organization have determined
these moments--just as they have eliminated
every non-essential in the things presented
for consideration and decision. Except when
emergencies arise there is no departure from
the rule: ``One thing at a time--the big
thing--at the right time.'' The task in hand
is never cheated, or allowed to cheat the next

in line. Management is as much a continuous
process, organized and wasteproof, as the
journey of raw materials through his plants.

This is an illustration of remarkable individual
efficiency attained by concentration
--the power of the human mind which seems
inseparable from any great achievement in
business, in politics, in the arts, in education.
Through it men of moderate capacities have
secured results apparently beyond the reach
of genius. And in no field has this power of
concentration been displayed more vividly by
leaders or been more generally lacking in the
rank and file than in business. Analysis of
the conditions may suggest the reason and the

_The modern business man is exhausted no
more by his actual achievements than by the
things which he is compelled to resist doing_.

Appeals for his attention are ceaseless.
The roar of the street, the ring of telephone
bells, the din of typewriting machines, the
sight of a row of men waiting for an interview,
the muffled voices from neighboring offices or

workers, the plan for the day's work which is
being delayed, the anxiety for the results for
certain endeavors, suspicion as to the loyalty
of employees--these and a score of other distractions
are constantly bombarding him.

Every appeal for attention demands expenditure
of energy--to ignore it and hold
the mind down to the business in hand. The
simple life with its single appeal is not for the
business man. For him life is complex and
strenuous. To overcome distractions and focus
his mind on one thing is a large part of his
task. If this single thing alone appealed to
his attention, the effort would be pleasing and
effective. It is not the work that is hard; the
strain comes in keeping other things at bay
while completing the pressing duty.

_He is exhausted, not because of his achievements,
but because of the expenditure of energy
in resisting distractions_.

He is inefficient, not through lack of industry,
but from lack of opportunity or of ability
to concentrate his energy upon the single task
at hand.

All sources of illumination--from the candle
to the sun--send out rays of light equally
in all directions. If illumination of only _*one_
point is desired, the loss is appalling. The rays
may be assembled, however, by reflectors and
lenses and so brought to bear in great force
at a single point.

This brilliancy is not secured by greater
expenditure of energy, but by utilizing the
rays which, except for the reflectors and lenses,
would be dissipated in other directions.

_As any source gives off equally in all directions,
so the human intellect seems designed to respond
to all forms and sorts of appeal for attention_.

To keep light from going off in useless directions
we use reflectors; to keep human energy
from being expended in useless directions we
must remove distractions. To focus the light
at any point we use lenses; to focus our minds
at any point we use concentration.

Concentration is a state secured by the mental
activity called attention. To understand
concentration we must first consider the more
fundamental facts of attention.

In the evolution of the human race certain
things have been so important for the individual
and the race that responses towards
them have become instinctive. They appeal
to every individual and attract his attention
without fail. Thus moving objects, loud
sounds, sudden contrasts, and the like, were
ordinarily portents of evil to primitive man,
and his attention was drawn to them irresistibly.
Even for us to pay attention to such
objects requires no intention and no effort.
Hence it is spoken of as _*passive_ or _*involuntary

The attention of animals and of children
is practically confined to this passive form,
while adults are by no means free from it.
For instance, ideas and things to which I
have no intention of turning my mind attract
me. Ripe fruit, gesticulating men, beautiful
women, approaching holidays, and scores of
other things simply pop up in my mind and
enthrall my attention. My mind may be so
concentrated upon these things that I become
oblivious to pressing responsibilities. In some

instances the concentration may be but momentary;
in others there may result a day
dream, a building of air castles, which lasts
for a long time and recurs with distressing

_Such attention is action in the line of least
resistance. Though it may suffice for the acts
of animals and children it is sadly deficient for
our complex business life_.

Even here, however, it is easy to relapse
to the lower plane of activity and to respond
to the appeal of the crier in the street, the
inconvenience of the heat, the news of the ball
game, or a pleasing reverie, or even to fall
into a state of mental apathy. The warfare
against these distractions is never wholly
won. Banishing these allurements results in
the concentration so essential for successfully
handling business problems. The strain is
not so much in solving the problems as in retaining
the concentration of the mind.

When an effort of will enables us to overcome
these distractions and apply our minds to the
subject in hand, the strain soon repeats itself.

It frequently happens that this struggle is
continuous--particularly when the distractions
are unusual or our physical condition is
below the normal. No effort of the will is
able to hold our minds down to work for any
length of time unless the task develops interest
in itself.

This attention with effort is known as _*voluntary
attention_. It is the most exhausting act
which any individual can perform. Strength
of will consists in the power to resist distractions
and to hold the mind down to even
the most uninteresting occupations.

_Fortunately for human achievement, acts
which in the beginning require voluntary effort
may later result without effort_.

The schoolboy must struggle to keep his
mind on such uninteresting things as the alphabet.
Later he may become a literary
man and find that nothing attracts his attention
so quickly as printed symbols. In commercial
arithmetic the boy labors to fix his
attention on dollar signs and problems involving
profit and loss. Launched in business,

however, these things may attract him more
than a football game.

It is the outcome of previous application
that we now attend without effort to many
things in our civilization which differ from
those of more primitive life. Such attention
without effort is known as _*secondary passive
attention_. Examples are furnished by the
geologist's attention to the strata of the
earth, the historian's to original manuscripts,
the manufacturer's to by-products, the merchant's
to distant customers, and the attention
which we all give to printed symbols and scores
of other things unnoticed by our distant ancestors.
Here our attention is similar to passive
attention, though the latter was the result
of inheritance, while our secondary passive
attention results from our individual efforts
and is the product of our training.

Through passive attention my concentration
upon a ``castle in Spain'' may be perfect
until destroyed by a fly on my nose. Voluntary
attention may make my concentration
upon the duty at hand entirely satisfactory

till dissipated by some one entering my office.
Secondary passive attention fixes my mind
upon the adding of a column of figures, and it
may be distracted by a commotion in my vicinity.
Thus concentration produced by any
form of attention is easily destroyed by a
legion of possible disturbances. If I desire
to increase my concentration to the maximum,
I must remove every possible cause of

_Organized society has recognized the hindering
effect of some distractions and has made
halting attempts to abolish them_.

Thus locomotives are prohibited from sounding
whistles within city limits, but power
plants are permitted by noise and smoke to
annoy every citizen in the vicinity. Street
cars are forbidden to use flat wheels, but are
still allowed to run on the surface or on a
resounding structure and thus become a public
nuisance. Steam calliopes, newsboys, street
venders, and other unnecessary sources of
noise are still tolerated.

In the design and construction of office

buildings, stores, and factories in noisy neighborhoods,
too little consideration is given to
existing means of excluding or deadening
outside sounds, though the newer office buildings
are examples of initiative in this direction;
not only are they of sound-proof construction,
but in many instances they have replaced the
noisy pavements of the streets with blocks
which reduce the clatter to a minimum. In
both improvements they have been emulated
by some of the great retail stores which have
shut out external noises and reduced those
within to a point where they no longer distract
the attention of clerks or customers
from the business of selling and buying. In
many, however, clerks are still forced to call
aloud for cash girls or department managers,
and the handling of customers at elevators is
attended by wholly unnecessary shouting and
clash of equipment.

Of all distractions, sound is certainly the
most common and the most insistent in its appeal.

The individual efforts towards reducing
it quoted above were stimulated by the hope

of immediate and tangible profit--sound-
proof offices commanding higher rents and
quiet stores attracting more customers. In
not a few cases, manufacturers have gone
deeper, however, recognizing that anything
which claims the attention of an employee
from his work reduces his efficiency and cuts
profits, even though he be a piece worker. In
part this explains the migration of many industries
to the smaller towns and the development
of a new type of city factory with sound-
proof walls and floors, windows sealed against
noise, and a system of mechanical ventilation.

The individual manufacturer or merchant,
therefore, need not wait for a general crusade
to abate the noise, the smoke, and the other
distractions which reduce his employee's
effectiveness. In no small measure he can shut
out external noises and eliminate many of
those within. Loud dictation, conversations,
clicking typewriters, loud-ringing telephones,
can all be cut to a key which makes them virtually
indistinguishable in an office of any
size. More and more the big open office as

an absorbent of sound seems to be gaining in
favor. In one of the newest and largest of
these I know, nearly all the typewriting machines
are segregated in a glass-walled room,
and long-distance telephone messages can be
taken at any instrument in the great office.

_Like sound in its imperative appeal for attention
is the consciousness of strangers passing
one's desk or windows_.

Movement of fellow employees about the
department, unless excessive or unusual, is
hardly noticed; let an individual or a group
with whom we are not acquainted come within
the field of our vision, and they claim attention
immediately. For this reason shops or factories
whose windows command a busy street
find it profitable to use opaque glass to shut
out the shifting scene.

This scheme of retreat and protection has
been carried well-nigh to perfection by many
executives. Private offices guarded by secretaries
fortify them against distractions and
unauthorized claims on their attention, both
from within and without their organizations.

Routine problems, in administration, production,
distribution, are never referred to them;
these are settled by department heads, and
only new or vital questions are submitted to
the executive. In many large companies,
besides the department heads and secretaries
who assume this load of routine, there are
assistants to the president and the general
manager who further reduce the demands
upon their chiefs. The value of time, the
effect of interruptions and distractions upon
their own efficiency, are understood by countless
executives who neglect to guard their
employees against similar distractions.

_Individual business men, unsupported by
organizations, have worked out individual methods
of self-protection_.

One man postpones consideration of questions
of policy, selling conditions, and soon until
the business of the day has been finished, and
interruptions from customers or employees are
improbable. Another, with his stenographer,
reaches his office half an hour earlier than his
organization, and, picking out the day's big

task, has it well towards accomplishment
before the usual distractions begin. The foremost
electrical and mechanical engineer in the
country solves his most difficult and abstruse
problems at home, at night. His organization
provides a perfect defense against interruptions;
but only in the silence, the isolation of
his home at night, does he find the complete
absence of distraction permitting the absolute
concentration which produces great results.

This chapter was prefaced by an instance
where protection from distractions through
organization was joined with methodical
attack on the elements of the day's work. This
combination approaches the ideal; it is the
system followed by nearly all the great
executives of America. Time and attention are
equably allotted to the various interests,
the various departments of effort which must
have the big man's consideration during the
day. Analysis has determined how much of
each is required; appointments are made with
the men who must coperate; all other matters
are pushed aside until a decision is reached;

and upon the completion of each attention is
concentrated on the next task.

A striking instance of this organization of
work and concentration upon a single problem
is afforded by the ``cabinet meetings'' of some
large corporations and the luncheons of groups
of powerful financiers in New York. There
are certain questions to be settled, a definite
length of time in which to settle them. In the
order of their importance they are allotted so
many minutes. At the expiration of that time
a vote is taken, the president or chairman
announces his decision, and the next matter is

_There is no royal method of training in
concentration. It is in the main developed by
repeated acts of attention upon the subject in

If I am anxious or need to develop the power
of concentration upon what people say, either
in conversation or in public discourse, I may
be helped by persistently and continuously
forcing myself to attend. The habit of
concentration may to a degree be thus acquired;

pursuing it, I should never allow myself to
listen indifferently, but I must force myself to
strict attention.

Such practice would result ultimately in a
habit of concentration upon what I hear,
but would not necessarily increase my power
of concentration upon writing, adding, or other
activities. Specific training in each is essential,
and even then the results will be far short
of what might be desired. Persistent effort
in any direction is not without result, however,
and any increase in concentration is so valuable
that it is worth the effort it costs. If a man
lacks power of concentration in any particular
direction, he should force concentration in that
line and continue till a habit results.

Our control over our muscles and movements
far exceeds our direct control over our
attention. An attitude of concentration is
possible, even when the desired mental process
is not present. Thus by fixing my eyes on a
page and keeping them adjusted for reading,
even when my mind is on a subject far removed,
I can help my will to secure concentration. I

can likewise restrain myself from picking up a
newspaper or from chatting with a friend when
it is the time for concentrated action on my
work. By continuously resisting movements
which tend to distract and by holding myself
in the position of attention, the strain upon
my will in forcing concentration becomes less.

_Concentration is practically impossible when
the brain is fagged or the bodily condition is far
below the normal in any respect_.

The connection between the body and the
mind is most intimate, and the perfect working
of the body is necessary to the highest efficiency
of the mind. The power of concentration is
accordingly affected by surroundings in the
hours of labor, by sleep and recreation, by the
quality and quantity of food, and by every
condition which affects the bodily processes

Recognition of this truth is behind the very
general movement, both here and abroad, to
provide the best possible conditions both in the
factories and the home environment of workers.
Employers are coming more and more to un-

derstand that conservation of physical forces
means maximum output. The foundation,
of course, is a clean, spacious, well-lighted, and
perfectly ventilated factory in a situation which
affords pure air and accessibility to the homes
of employees. In England and Germany the
advance towards this ideal has taken form in
the ``garden cities'' of which the plant is the
nucleus and the support. In America there is
no lack of industrial towns planned and built
as carefully as the works to which they are

Some have added various ``welfare'' features,
ranging from hot luncheons served at
cost, free baths, and medical attendance to
night schools for employees to teach them how
to live and work to better advantage. The
profit comes back in the increased efficiency
of the employees.

_Even though the health be perfect and the
attitude of attention be sustained the will is
unable to retain concentration by an effort for
more than a few seconds at a time_.

When the mind is concentrated upon an

object, this object must develop and prove
interesting, otherwise there will be required
every few seconds the same tug of the will.
This concentration by voluntary attention is
essential, but cannot be permanent. To secure
enduring concentration we may have to
``pull ourselves together'' occasionally, but the
necessity for such efforts should be reduced.
This is accomplished by developing interest
in the task before us, through application of
the fundamental motives such as self-preservation,
imitation, competition, loyalty, and
the love of the game.

If the task before me is essential for my
self-preservation, I shall find my mind riveted
upon it. If I hope to secure more from speculation
than from the completion of my present
tasks, then my self-preservation is not
dependent upon my work and my mind will
irresistibly be drawn to the stock market and
the race track. If I wish my work to be
interesting and to compel my undivided attention,
I should then try to make it appeal
to me as of more importance than anything

else in the world. I must be dependent upon
it for my income; I must see that others are
working and so imitate their action; I must
compete with others in the accomplishment
of the task; I must regard the work as a service
to the house; and I must in every possible
way try to ``get into the game.''

_This conversion of a difficult task into an
interesting activity is the most fruitful method of
securing concentration_.

Efforts of will can never be dispensed with,
but the necessity for such efforts should be
reduced to the minimum. The assumption
of the attitude of attention should gradually
become habitual during the hours of work, and
so take care of itself.

The methods which a business man must
use to cultivate concentration in himself are
also applicable to his employees. The manner
of applying the methods is, of course, different.
The employer may see to it that as far as
possible all distractions are removed. He cannot
directly cause his men to put forth voluntary
effort, but he can see to it that they re-

tain the attitude of concentration. This may
require the prohibition of acts which are distracting
but which would otherwise seem indifferent.
The employer has a duty in regard
to the health of his men. Certain employers
have assumed to regulate the lives of their men
even after the day's work is over. Bad habits
have been prohibited; sanitary conditions of
living have been provided; hours of labor
have been reduced; vacations have been
granted; and sanitary conditions in shop and
factory have been provided for.

_Employers are finding it to their interest to
make concentration easy for their men by rendering
their work interesting_.

This they have done by making the work
seem worth while. The men are given living
wages, the hope of promotion is not too long
deferred, attractive and efficient models for
imitation are provided, friendly competition is
encouraged, loyalty to the house is engendered,
and love of the work inculcated. In addition,
everything which hinders the development of
interest in the work has been resisted.

How will a salesman, for instance, develop
interest in his work if he makes more from his
``side lines'' than from the service he renders
to the house which pays his expenses? How
can the laborer be interested in his work if he
believes that by gambling he can make more
in an hour than he could by a month's steady
work? The successful shoemaker sticks to his
last, the successful professional man keeps out
of business, and the wise business man resists
the temptation to speculate. Occasionally a
man may be capable of carrying on diverse
lines of business for himself, but the man is
certainly a very great exception who can hold
his attention to the interests of his employer
when he expects to receive greater rewards
from other sources.

_The power of concentration depends in part
upon inheritance and in part upon training_.

Some individuals, like an Edison or a Roosevelt,
seem to be constructed after the manner of
a searchlight. All their energy may be turned
in one direction and all the rest of the world
disregarded. Others are what we call scatter-

brained. They are unable to attend completely
to any one thing. They respond constantly
to stimulation in the environment and to
ideas which seem to ``pop up'' in their minds.

Some people can read a book or paper with
perfect satisfaction, even though companions
around them are talking and laughing. For
others, such attempts are farcical.

Many great men are reputed to have had
marvelous powers of concentration. When
engaged in their work, they became so absorbed
in it that distracting thoughts had no access
to their minds, and even hunger, sleep, and
salutations of friends have frequently been
unable to divert the attention from the absorbing

_There are persons who cannot really work except
in the midst of excitement_.

When surrounded by numerous appeals to
attention, they get wakened up by resisting
these attractions and find superfluous energy
adequate to attend to the subject in hand.
This is on the same principle that governs
the effects of poisonous stimulants. Taken

into the system, the whole bodily activity is
aroused in an attempt to expel the poison.
Some of this abnormally awakened energy
may be applied to uses other than those intended
by nature. Hence some individuals
are actually helped in their work at least
temporarily by the use of stimulants. Most
of the energy is of course required to expel the
poison, and hence the method of generating
the energy is uneconomical.

The men who find that they can accomplish
the most work and concentrate themselves
upon it the most perfectly when in the midst
of noise and confusion are paying a great price
for the increase of energy, available for profitable
work. To be dependent on confusion for
the necessary stimulation is abnormal and expensive.
Rapid exhaustion and a shortened
life result. It is a bad habit and nothing more.

_Many persons seem able to disregard the common
and necessary distractions of office, store, or

Other persons are so constituted that these
distractions can never be overcome. Such

persons cannot hear a message through a telephone
when others in the room are talking;
they cannot dictate a letter if a third person is
within hearing; they cannot add a column of
figures when others are talking. Habit and
effort may reduce such disability, but in some
instances it will never even approximately
eliminate it. Such persons may be very
efficient employees, and their inability to concentrate
in the presence of distractions should
be respected. Every business man is careful
to locate every piece of machinery where it
will work best, but equal care has not been
given to locating men where they may work to
the greatest advantage.

By inheritance the power of concentration
differs greatly among intelligent persons. By
training, those with defective power may improve,
but will never perfect the power to concentrate
amidst distractions. To subject such
persons to distractions is an unwise expenditure
of energy

_Concentration by voluntary attention should be
avoided, but concentration by secondary passive_

_attention cultivated. Organized business interests
should eliminate such public nuisances as
surface street cars, elevated trains, venders of
wares, screeching newsboys, smoking chimneys,
and the like_.

In individual establishments walls may be
deadened to sounds, telephones may be muffled,
call bells may be replaced by buzzers with indicators,
clerks may have other methods than
that of calling aloud for ``cash'' or for floor
walkers, typewriters may be massed with a
view to reducing the general commotion, the
illumination at the desks may be increased,
discomforts should be reduced to a minimum,
work may be so systematized that only one
task at a time demands attention.

At least the attitude of concentration should
be habitual. The bodily condition favorable
to the best concentration may make profitable
such devices as firm lunch rooms, the
building of industrial villages, and so on.

Concentration is secured positively by bringing
into activity the various motives which
affect most powerfully the different individu-

als. There should be a universal taboo on
horse racing and all forms of gambling. Even
``side lines'' should be completely discouraged.
Some individuals are so hindered by the ordinary
and necessary distractions of business
that special protection should be granted to




FIFTY years ago works on psychology
were devoted largely to discussion of
ideas and of concepts. To-day the
point of emphasis has changed, and we are
now paying much attention to a study of
``attitudes.'' It is doubtless important to
analyze my ideas or concepts, but it is of
much more importance to know my attitudes.
It is vital to know how to influence the ideas
of others; but to be able to influence their
attitudes is of still greater significance.

We all know in a general way what we
mean by an attitude, but it is difficult to define
or to comprehend it exactly. I have one attitude
towards a snake and a totally different
one towards my students. If when hunting

quail I happen upon a little harmless snake,
I find that I respond to the sight in a most
absurd manner. Dread and repulsion overcome
me. I can hardly restrain myself from
killing the snake, even though doing so will
frighten the birds I am hunting. I am predisposed
to react in a particular way towards
a snake. I sustain a particular attitude towards

In the presence of my students I find that a
spirit of unselfish devotion and a desire to be
of assistance are likely to be uppermost.
That is to say, I sustain towards my students
an attitude of helpfulness, a predisposition
to react towards them in such a way that their
interests may be furthered. In fact, I find
that we all take particular attitudes towards
the people we know and towards every task of
our lives. These attitudes are very significant,
and yet they are often developed by circumstances
which made but little apparent impression
at the time, or may have been altogether
forgotten. I cannot recall, for instance,
the experience of my boyhood which developed

my present absurd attitude toward harmless

When witnessing a play, my attitude of
suspicion towards a particular character may
have been promoted by means of music and
color, by means of the total setting of the play,
or by some other means which never seemed to
catch my attention. These concealed agencies
threw me into an attitude of suspicion, even
while I was not aware that such a result was
being attempted.

This modern conception of psychology
teaches us that in influencing others we are
not successful until we have influenced their
attitudes. Children in school do not draw
patriotism from mere information about their
country. Patriotism comes with the cultivation
of the proper attitude towards one's
native land.

_Success or failure in business is caused more
by mental attitude even than by mental capacities_.

Nothing but failure can result from the
mental attitude which we designate variously
as laziness, indifference, indolence, apathy,

shiftlessness, and lack of interest. All business
successes are due in part to the attitudes
which we call industry, perseverance, interest,
application, enthusiasm, and diligence.

In any individual, too, these attitudes may
not be the same towards different objects
and may be subject to very profound changes
and developments. A schoolboy is frequently
lazy when engaged in the study of grammar,
but industrious when at work in manual
training. A young man who is an indolent
bookkeeper may prove to be an indefatigable
salesman. Another who has shown himself
apathetic and indifferent in a subordinate
position may suddenly wake up when cast
upon his own responsibility.

Few men of any intelligence can develop
the same degree of interest in each of several
tasks. Personally I find that my shiftlessness
in regard to some of my work is appalling.
Touching my main activities, however, I
judge that my industry is above reproach.

The preceding chapters (particularly the
chapters on Imitation, Competition, and Loy-

alty) were attempts to discover and to present
the most effective motives or factors in producing
in workers an attitude of industry.
Based on a study of psychology and of business,
methods were presented which may be
utilized with but little expense and yet are
effective in awakening instinctive responses in
the worker and hence greatly increasing his
efficiency. The present chapter will deal with
an even more effective means of securing an
attitude of industry since it appeals to three
of the most fundamental and irresistible of
man's instincts.

_With most of us the degree of our laziness or
our industry depends partly upon our affinity
for the work, but chiefly upon the motives which
stimulate us_.

For our ancestors, preservation depended
upon their securing the necessary means for
food, clothing, and shelter. In the struggle
for existence only those individuals and races
survived who were able to secure these necessary
articles. In climates and regions removed
from the tropics only the exceedingly

industrious survived. In warm and fertile
lands those who were relatively industrious
managed to exist. Because of the absence of
the necessity for clothing and because of the
abundance of available food, races have developed
in the tropics which are notoriously
lazy. The human race, individually and collectively,
works only where and when it is
compelled to.

The energetic races, those which have advanced
in civilization, live in lands where the
struggle for existence has been continuous.
Necessity is a hard master, but its rule is
indispensable to worthy achievement. The instinct
of self-preservation and the industrious
attitude are responses which the human race
has learned to exercise, in the main, only in
case of need. Self-preservation is the first
law; where life and personal liberty are
dependent upon industry, idleness will not be
found. Wealth removes the obligation to
toil; hence the poor boy often outdistances
his more favored brother.

Individuals work for pay as a means of

self-preservation, and unless that is satisfactory
other motives have but little weight
with them. The needs of the self which preservation
demands are continuously increasing.
The needs of the American-born laborer are
greater than those of the Chinaman. Regardless
of this higher standard of living and
the ever increasing number of ``necessities,''
the instinct of self-preservation acts in connection
with them all.

_Almost without exception the interest of workers
centers in the wage. If they could retain
their accustomed wage with less effort, they would
do so. If the retention and increase depend on
individual production, they will respond to the

Every student of psychology recognizes the
fact that the wage is more than a means of
self-preservation. Man is a distinctly social
creature. He has a social self as well as an
individual self. His social self demands social
approval as much as his individual self demands
bread, clothing, and shelter. In our
present industrial system this social distinc-

tion is most often indicated by means of monetary
reward. The laborer not only demands
that his toil shall provide the means for self-
preservation, but he seeks through his wages
the social distinction which he feels to be his
due. His desire for increase of wages is often
partly, and in some instances mainly, due to
his craving for distinction or social approval.

In such instances the wage is to be thought
of as something comparable to the score of a
ball player. The desire for a high score is
sufficient motive to beget the most extreme
exertion, even though the reward anticipated
is nothing more than a sign of distinction and
without any relationship whatever to self-

In common with some of the lower animals
man has an instinct to collect and hoard all
sorts of things. This instinct is spoken of
in psychology as the hoarding or proprietary
instinct. In performing instinctive acts we
do so with enthusiasm, but blindly. We take
great delight in the performing of the act,
even though the ultimate result of the act

may be entirely unknown to us. The squirrel
collects and stores nuts with great delight and
industry. He has no idea of the approaching
winter, but gathers the nuts simply because
for him it is the most interesting process in his

Most persons display a like instinctive
tendency to make collections and hoard articles.
This is particularly apparent in collections
of such things as canceled postage
stamps, discarded buttons, pebbles, sticks,
magazines, and other non-useful articles.

When this hoarding instinct is not controlled
by reason or checked by other interests, we
have the miser. In a less degree, we all share
with the miser his hoarding instinct. We all
like to collect money just as the squirrel likes
to gather nuts. The octogenarian continues
to collect money with unabated zeal, even
though he be childless. He is probably not
aware that he is collecting merely for the pleasure
of collecting.

_Since the wage is the means ordinarily employed
to awaken in workers the three instincts_

_of self-preservation, of social distinction, and of
hoarding, it is not strange that an industrial
age should regard it as the chief means of increasing

The employer has not attempted to discover
what instincts were appealed to by the wage,
or the most economical method of stimulating
these instincts. He has not undervalued the
wage in securing efficiency, but rather has
assumed that the service secured must be in
direct proportion to the amount expended.

Such an assumption is not warranted.
Of two employers with equal forces and payrolls
one may receive much more and better
service than the other. It is not a question
merely of how much is spent but how wisely
it is spent. The wage secures service to the
degree in which it awakens these fundamental
instincts under consideration.

It is apparent, therefore, that other factors
than the amount of money expended in wages
are to be considered by every employer. Without
increasing the pay roll he may increase the
efficiency of his men. The employer who has

determined the number of men he needs and
the wages he must pay has only begun to solve
his labor problem.

In the preparation of the present chapter a
large number of business men were interviewed
personally or by correspondence.

One of the questions asked was: ``How do
you make the most of the wages paid your

As subsidiary to this general question three
other questions were asked: ``In paying them
do you base the amount to be received by each
man upon a fixed salary? By some of the
men upon actual output--commissions or
piecework rates? By some upon a combination
including profit-sharing or bonus?''

The answers to these latter questions were
not uniform even among employers engaged
apparently in the same business and under
very similar conditions. Some reported that
all the methods suggested were used in their
establishment. Factory hands were employed
on piecework or on a premium or bonus basis
where conditions permitted; office assistants

on fixed salaries; department managers upon
a combination including profit sharing. The
results reported, however, were far from uniform.
The astounding feature was the diversity
of opinion among successful managers
of employees. By various houses one or more
of the systems had been tried under apparently
favorable conditions and had been discarded.
On the other hand each of the systems was
advocated by equally successful business firms.

In judging of the relative merits of fixed
salaries as compared with other methods the
experiences of individual firms offer no certain
data. The relative merits and demerits
are best disclosed by a psychological analysis
of the manner in which the various devices
appeal to the employee's instincts and reason.

_When wages are based on commission, piece
rate, or a bonus or premium system, the stimulus
to action is constantly present. Every stroke
of the hammer, every sale made, every figure
added, increases the wage. The wage thus continuously
beckons the worker to greater accomplishment_.

All other considerations lose in importance,
and the mind becomes focused on output.
The worker is blinded to all other motives,
and invariably sacrifices quality unless this
be guarded by rigid inspection. The piecework
or task system thus influences the worker
directly and incessantly without regard for
the particular instinct to which it may be appealing.
Every increase in rate adds directly
to the means of self-preservation, of social
distinction, and of the accumulation of

_The worker with a fixed salary or wage does
not feel as continuously the goad of his wage.
It is less in mind and does not control his attitude
toward his work. The man on a fixed
salary, therefore, will not produce so much_.

If he be a workman, he may take better
care of his tools, keep his output up to a higher
standard of quality, prepare himself for more
responsible positions. If he be a salesman, he
may be more considerate of his customers and
hence really more valuable to his employer;
he may be more loyal to the house and hence

promote the ``team work'' of the organization,
and he may because of his more receptive state
of mind be preparing himself for much greater
usefulness to his house. If he be a superintendent,
he may be more thoughtful of his
men, or more scrupulous for the future of the

Production methods or labor conditions
are often such that piecework is impossible.
There are many functions and processes which
thus far have not been satisfactorily adjusted
to task systems; there are others (the inspection
service in a factory, for instance) where a
premium on increased output would defeat
the first purpose of the service. Where results
can be accurately measured, however, and the
quality of the service can be automatically
secured or is not sacrificed by concentration
upon quantity, the task system--whether
it take the form of piece rates, premiums, or
bonus--has such superior psychological advantages
that it will probably come more and
more into use.

Under the general heading quoted above--

``How do you make the most of the wages
paid your employees?''--the following question
was asked: ``What special method do
you employ to make men satisfied or pleased
with their wages?'' The answers were most
interesting and instructive. One manager
having many thousand men in his organization
narrated various methods by which he
kept in personal touch with his men, and
turned this personal relationship to the advantage
of the house.

One illustration will make clear the line he
pursued. In the card catalogue of the employees,
the birthday of each is noted, the
executive recognizing that for the average
man this is an anniversary even more important
than New Year's.


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