Neverisms Page 22

  In the early 1900s, an increasing number of graduates of the Massachusetts Institute of Technology were enjoying great success in the business world. The American economy was expanding at a rapid rate, and the demand for new products and improved manufacturing methods greatly enhanced the prospects of highly trained engineers. As many MIT graduates became business owners and factory managers, however, they began to vent a common frustration when they got together at alumni gatherings. While their alma mater had provided them with exceptional technical training, it had inadequately prepared them for the issues that now kept them awake at night, particularly the complex management decisions and thorny personnel issues. In 1913, an ad hoc committee of the MIT Alumni Council was formed to study the problem. Later that year, they formally recommended that the university create a new program “specifically designed to train men to be competent managers of businesses that have much to do with engineering problems.”

  The next year, in 1914, faculty members from several MIT departments began to lay the groundwork for a new program of study. Following the university’s longstanding tradition of designating programs by numbers instead of names, they began designing Course XV, a planned concentration in what they were calling “Engineering Administration.” After a few initial courses were filled up by eager students, it became apparent that a more substantial effort was going to be required. In 1916, three new faculty members were hired. In 1917, Erwin H. Schell, an MIT alum from the Class of 1912, was hired as the first formal head of Course XV, formally renamed “Business Management.”

  Almost immediately, Schell began to prove the truth of Emerson’s famous observation that “An institution is the lengthened shadow of one man.” Under his leadership, the program flourished, and he became one of the college’s most popular and respected instructors.

  When Schell came out with The Technique of Executive Control in 1924, he almost singlehandedly formulated the concept of the modern manager, a major step up from the factory boss mentality that was common at the time. Schell’s book was revised and updated many, many times over the decades. I have a copy of the 1950 edition, and it contains one of the best management quotations of all time:

  Remember that when an employee enters your office he is in a strange land.

  He feels the atmosphere of authority; he is constrained and hesitant.

  Make him feel at ease.

  The book is also filled with many very helpful neverisms, all of them ringing as true today as when they were written so many decades ago:

  Never let personal pride stand in the way of getting the right answer.

  Never use underhanded methods in retaliation for covert opposition.

  Never upbraid an employee in an emotional manner;

  under no circumstances should you direct profanity at a workman.

  Never make a man obey you against his will,

  unless the act you require is to compensate for a wrong

  which he knowingly committed.

  Never ride roughshod over the feelings of another.

  Such acts are not constructive; they arouse harmful resentment.

  Never hold a man back on the basis that he otherwise

  will outgrow his job and find a better position elsewhere.

  Make it a rule never to say anything about any individual

  that you would not say to him personally.

  Never treat a new employee as a suspicious character

  who requires watching until he has proved his honesty and worth.

  In 1930, Schell was approached by Alfred P. Sloan, an 1895 graduate of MIT who had recently become president of General Motors. Sloan felt that many of GM’s highly trained engineers were lacking in management skills, and he wondered if Schell could help. Sensing a major opportunity, Schell began designing the world’s first university-based executive education program for mid-career engineers. The next year, “Sloan Fellows” from GM were sitting alongside regular MIT students, and within a few years, business schools around the country were attempting to replicate the model.

  In 1952, a year after Schell retired as dean, a grant from The Sloan Foundation formally established the MIT School of Industrial Management. It was later renamed the Alfred P. Sloan School of Management, but there are many who think it might have been more fitting to name the school after Erwin Schell.

  If the topic of managing people is the most popular topic in business literature, then the subject of investing would probably come in at second place. Many of the best investment quotations have been expressed neveristically, with many cited as examples of “Wall Street Wisdom”:

  Never invest on impulse.

  Never trade to pay your bills.

  Never fall in love with a stock.

  Never confuse brains with a bull market.

  Never invest more than you can afford to lose.

  Never invest on the basis of recommendations from friends.

  Never invest on the basis of information

  from chat rooms or Internet sources.

  Some of history’s best-known investors have also weighed in with stern cautionary warnings:

  Never invest in a business you cannot understand.WARREN BUFFETT

  Never invest in any idea you can’t illustrate with a crayon.PETER LYNCH, offering “Peter’s Principle #3” in

  his 1993 investment classic Beating the Street

  Never invest on sentiment. Never invest solely on a tip.JOHN TEMPLETON

  My all-time favorite investment quotation, though, comes not from a famous investor or money-managing wizard, but from one of the great names in show-business history. The theatrical impresario Billy Rose once famously advised:

  Never invest your money in anything that eats or needs repainting.

  In the remainder of the chapter, you’ll find many more management and investment admonitions, but you’ll also find warnings about a variety of other things you should never do if you want to achieve success and avoid failure in the business arena.

  Never rest on your laurels.

  Nothing wilts faster than a laurel sat upon.MARY KAY ASH

  Resting on one’s laurels is a saying that can be traced to the ancient Olympic games, when a laurel wreath was placed on the head of a victorious athlete. The saying has now become a cliché, but Ash’s clever tweaking of it sidesteps that problem and earns her extra points for being a CEO with a sense of humor. “The Mary Kay Way,” as it is commonly called, also includes these other straight-talking neverisms, which she refers to as “Timeless Principles” in her books and lectures:

  Never Give Criticism in Front of Others.

  Never Give Criticism Without Praise.

  Never Make a Promise You Can’t Keep.

  Never Hide Behind Policy or Pomposity.

  Never coddle a malcontent.PETER BAIDA, from a “Manager’s Journal” column

  in the Wall Street Journal in the early 1980s

  Never pay the slightest attention to

  what a company president ever says about his stock.BERNARD M. BARUCH, advice to investors

  After graduating from CCNY in 1898, Baruch got a job as a Wall Street office boy for $3 a week. A decade later, his investments had made him a millionaire. In WWI, Woodrow Wilson named him to his war council, and over the next four decades he served as an adviser to every American president. He is also credited with these investment rules:

  Never follow the crowd.

  Never play tips from “insiders.” They can’t see the forest for the trees.

  Never punish a learner.KEN BLANCHARD & SPENCER JOHNSON,

  in The One Minute Manager (1982)

  Never do anything with an employee

  that you would not do with your firm’s number-one client or customer.W. STEVEN BROWN

  Brown offered this guideline for boss-employee relations in his 1997 book 13 Fatal Errors Managers Make and How You Can Avoid Them. In the book, he also advised:

  Never confront in anger.

  Never call your group
on the carpet

  through the use of a “hot” letter or memo.

  Rule Number One: Never lose money.

  Rule Number Two: Never forget rule Number One.WARREN BUFFETT

  For more than twenty-five years, Buffett has been citing these as his two most important investment rules. In his many speeches and “Chairman’s Letters” (as chairman of the board of Berkshire Hathaway), Buffett has shown a gift for expressing himself in straightforward and memorable ways. He has also advised:

  Never ask a barber if you need a haircut.

  Never be afraid to ask for too much when selling

  or offer too little when buying.

  Never arrive on time; this stamps you as a beginner.HARRY CHAPMAN

  This tongue-in-cheek advice first appeared in a 1963 issue of The Greater Kansas City Medical Bulletin. Since that time, Chapman’s rules for serving on committees have been reprinted in scores of publications. Details about the author’s identity have been lost to history, but his rules have held up remarkably well. Here’s the remainder of his advice:

  Don’t say anything until the meeting is half over;

  this stamps you as being wise.

  Be as vague as possible; this avoids irritating the others.

  When in doubt, suggest that a sub-committee be appointed.

  Be the first one to move for adjournment;

  this will make you popular; it’s what everyone is waiting for.

  Never oppose a high-ranking man in public.NINA DISESA, in her 2008 book Seducing the Boys Club:

  Uncensored Tactics from a Woman at the Top

  DiSesa called this “The Cardinal Rule of Male Confrontation.” In 1999, after becoming chairman and chief creative officer of the ad agency McCann New York, DiSesa made Fortune magazine’s list of the “50 Most Powerful Women in American Business.”

  Never give someone two weeks notice that they are fired

  and keep them in the company.LINNDA DURRÉ, in Surviving the Toxic Workplace (2010)

  In her book, subtitled Protect Yourself Against the Co-Workers, Bosses, and Work Environments That Poison Your Day, Durré added:When you fire someone, do it humanely, have their severance check ready, get their keys and passcards turned in, let them clean out their desk, and escort them to the exit, wishing them well. Otherwise you will have a paid enemy on the staff.

  Never buy farther than you can walk.JOSEPH DURST, on purchasing real estate

  When Durst arrived at Ellis Island in 1902, he had $3 sewn into the lapel of his ragged coat. A garment manufacturer in his native Austria, he worked hard, saved every penny, and bought his first office building in 1915. When he died in 1974, the Durst Organization was one of Manhattan’s most influential real estate developers.

  Never criticize at the end of the week because you’ll kill his weekend.MORTIMER R. FEINBERG

  This advice appeared in a 1965 article “How to Criticize an Employee.” Feinberg added:If you criticize at night, around five o’clock, the guy goes home, he’s unhappy. He doesn’t eat supper. He doesn’t sleep. He tells his wife and she can’t sleep. When he comes in the next morning, he’s ready to kill you.

  Feinberg said his advice was inspired by Frank Boyden, the longtime headmaster of Deerfield Academy, who once offered a similar thought about criticizing students: “Never reprimand in the evening. Darkness and a troubled mind are a poor combination.”

  Never respond to a customer’s outburst with one of your own.P. M. FORNI, in The Civility Solution (2008)

  Never cancel plans with your children

  because of a workplace request unless your job is on the line.

  Even then think twice.LOIS E. FRANKEL, in Nice Girls

  Don’t Get the Corner Office (2004)

  Frankel, whose book was subtitled 101 Unconscious Mistakes Women Make That Sabotage Their Careers, also offered these additional warnings:

  Never sit with your foot tucked beneath you.

  Never accept any assignment before first checking it out.

  Never volunteer to make coffee or copies for a meeting.

  If asked, suggest the responsibilities be rotated.

  Never comb your hair or apply lipstick in public.

  If you can’t resist, excuse yourself and go to the ladies’ room.

  Never “tell it like it is” in company meetings.MARK GAUTHIER, advising Westerners,

  in his 1993 book Making It in Japan

  Gauthier, an American travel writer, added: “Speaking your mind and gushing out frank statements displays immaturity and is bad for group harmony.” He also wrote:

  Never visit a Japanese company without tons of business cards.

  Basically, no “meishi” (business cards) means no existence for you on this earth.

  Never fail to astonish the customer.MARGARET GETCHELL

  This statement, which is now a staple of customer-service seminars, was originally authored by Getchell as part of a motto for employees of Macy’s Department Store. Getchell, the niece of the founder of Macy’s and his first store manager, was the first woman in retailing history to be promoted to an executive position. She was also an ardent believer in customer service. The complete motto went this way: “Be everywhere, do everything, and never fail to astonish the customer.”

  Never try to make all the money that’s in a deal.J. PAUL GETTY, quoting his father

  Getty’s father added: “Let the other fellow make some money too, because if you have a reputation for always making all the money, you won’t have many deals.”

  Never confuse a hunch with a hope.MAX GUNTHER, in The Zurich Axioms (1985)

  After graduating from Princeton University in 1949 and serving a two-year stint in the army, Gunther worked as a writer and editor at Business Week and Time before embarking on a career as a freelance writer. In addition to writing magazine articles, he wrote nearly a dozen books on a variety of subjects before coming out with The Zurich Axioms in 1985. A compilation of investment secrets Gunther had learned from his father, a longtime investment strategist for the Swiss Bank Corporation, the book became a surprise bestseller. Many axioms were expressed neveristically:

  Never make a move if you are merely optimistic.

  Never lose sight of the possibility that you have made a bad bet.

  Never hesitate to abandon a venture

  if something more attractive comes into view.

  Never follow speculative fads.

  Often, the best time to buy something is when nobody else wants it.

  Never ignore a gut feeling: but never believe that it’s enough on its own.ROBERT HELLER, in The Super Managers (1984)

  Never hire or promote in your own image.

  It is foolish to replicate your strength and idiotic to replicate your weakness.DEE W. HOCK, founder and CEO emeritus

  of Visa International

  For more than twenty years, Hock has been advocating a “chaordic” approach to life and work, a philosophy that attempts to blend chaotic and ordered into one word—and one business philosophy. In his 2000 book Birth of the Chaordic Age, he also wrote:

  Never confuse activity with productivity.

  It’s what comes out the other end of the pipe that’s important,

  not what you push into it.

  Never borrow money unless you can get it paid back.H. L. HUNT

  When oil tycoon H. L. Hunt’s sons—William and Bunker Hunt—assumed an enormous debt burden in their failed 1980 attempt to corner the silver market, William was asked about his father’s advice. He replied ruefully, “I guess I didn’t listen well enough.”

  Never let your memories be greater than your dreams.DOUGLAS IVESTER, former CEO of Coca-Cola

  Never fear the want of business.

  A man who qualifies himself well for his calling

  never fails of employment in it.THOMAS JEFFERSON, in a 1792 letter to Peter Carr,

  using the word want in the sense of lack

  Never play by the rules. Never pay in cash. And never tell the tr
uth.F. ROSS JOHNSON, on “The Three Rules of Wall Street”

  Johnson, who enjoyed his reputation as a ruthless businessman, said this while serving as CEO of RJR Nabisco in the 1980s. Johnson was featured in the 1990 bestseller Barbarians at the Gate: The Fall of RJR Nabisco, by Bryan Burrough and John Helyar. The book was made into a 1993 HBO film, with James Garner in the role of Johnson.

  Never acquire a business you don’t know how to run.ROBERT W. JOHNSON, founder of Johnson & Johnson

  Never be intimidated by male bravado.CATHERINE KAPUTA, in her 2009 book The Female Brand:

  Using the Female Mindset to Succeed in Business

  Never value anybody based on position and title alone.HERB KELLEHER, citing a lesson from his mother

  Kelleher, the founder of Southwest Airlines, said this in his Charles A. Lindbergh Memorial Lecture, delivered at the Smithsonian Institution’s Air and Space Museum in 2008. In 1943, the twelve-year-old Kelleher’s father passed away, and shortly after that his older brother joined the army and his sister took a job in New York City. Left alone in their New Jersey home, Herb and his mother formed an extremely close-knit bond. He once said, “We would stay up till three, four, five in the morning, talking about business, politics, ethics.” She offered this lesson late one night when they discussed the embezzlement conviction of one of their town’s most distinguished citizens—a local bank president noted for strolling up and down the street in a regal way.