What Makes an Executive?

Not long ago, as part of a university survey designed to gauge their understanding of business theories and practices, several hundred entering freshmen were asked this question:

"Assuming that you owned a large business firm, what is the principal quality, trait or qualification you would want your executives to possess?"

Among the answers were these random -- but fairly typical -- examples:

"I'd want my executives to dress well and have good personalities."

"They would have to know how to entertain important customers."

"I'd only hire executives who could keep prices up and wages down."

"I'd insist on getting executives who were able to make people work harder and faster."

Now, naive as these replies may sound, one cannot blame freshmen for being somewhat hazy about what goes on in the business world. Unfortunately, their ignorance is shared by far too many who are much older and should be much wiser.

The principles of management personnel selection are often misunderstood, even by some who have long been active in the management of businesses large and small. I have encountered more than a few supposedly experienced businessmen whose concepts of the qualities and qualifications they or other management personnel should possess are nearly as muddled as those of the students.

Take, for example, the pompous -- and obviously job-seeking -- executive who cornered me recently at a cocktail party. He complained bitterly that he had been passed over for promotion twice by the well-known firm for which he worked.

"I'm a victim of company politics," he declared, obviously believing it. "There's no other explanation. I've always performed my duties exactly as an executive should!"

"And how is that?" I inquired, my curiosity to hear what weird theories he'd propound getting the better of my good judgment.

"I keep a tight rein on the people in my department. I never let them put anything over on me or the company. If they try, I fire them on the spot!" the man replied with smug pride. "I don't question my orders and always carry them out to the letter, regardless of the consequences."

At this point, I suddenly pretended that I'd just recognized a long-lost relative across the room, disengaged myself and beat a rapid retreat. I'd heard all I cared to hear -- or could stomach.

I can readily understand why this so-called executive hadn't been promoted. What I can't understand is why he hadn't been given the sack long before. Certainly, he wouldn't remain on my payroll for five minutes. He personifies the two worst qualities anyone holding down a responsible managerial job in a modern business firm could possibly possess.

His attitude toward his subordinates is clearly that of a slave-driving martinet. His attitude toward his superiors -- at least to their faces -- is just as clearly that of a complete bootlicker utterly devoid of imagination or common sense.

Let's look at it this way. Business management may be broadly defined as the art of directing human activities so as to carry out a business firm's policies and achieve its goals.

Whether it be general or specialized management -- such as personnel, purchasing, production or sales -- the key to all business management lies in the words: directing human activities.

No one possessing the attitudes of the disgruntled executive I (continued on page 106) Executive (continued from page 95) met at the cocktail party could possibly direct human beings in any activity. His type can only drive or bully those unfortunate enough to work under him. It is hardly necessary to point out that these are not methods to which employees will respond favorably or by which they can be prevailed upon to work productively.

But our horrible example's managerial failings do not end there. His straightfaced avowal that he doesn't question his orders and always carries them out "to the letter, regardless of the consequences," brands him a toady. It also proves him to be an extremely stupid person who has no concept of the responsibilities every executive owes to his superiors and the company for which he works.

True, an executive should conscientiously and loyally carry out the instructions he receives from those above him. But this does not mean he should carry them out blindly, like some mindless automaton. If he is a good executive, it follows that he will give much consideration to "the consequences."

However exalted his position, no man is infallible. Even board chairmen are human, and thus liable to make mistakes. An alert junior executive who recognizes errors, fallacies or weaknesses in the orders he receives from his superiors and fails to call their attention to them is not being conscientious or loyal. He is simply shirking his responsibility.

Any seasoned top-level executive would much rather have his mistakes pointed out to him early by a subordinate than have those mistakes make themselves painfully apparent later in the company's profit and loss statement.

A few years ago, I had to make some far-reaching decisions regarding the operations of one of my American companies. I was in Europe at the time and had received what I thought were all the needed facts in the form of letters, memoranda and reports from the company's management personnel. I didn't know, however, that a last-minute vitally important statistical report -- which drastically amended all such reports previously sent from the U.S. -- had been lost in the mails. The report did not reach me, and thus, I unwittingly based my planning on incomplete information.

Arriving at what I considered were the correct decisions, I sent an instruction letter to the company's offices in the United States. A few days later, I received an urgent transatlantic telephone call from one of the firm's executives. He politely but firmly pointed out that I'd apparently failed to take certain important facts into consideration, and that if the program I'd outlined were implemented, the company would suffer heavy losses.

After talking at what seemed to be cross-purposes for several minutes, we both realized I had based some key calculations on outdated statistical information. A copy of the missing report was airmailed to me immediately and I revised my calculations, decisions and instructions accordingly.

The program I finally outlined eventually proved successful and profitable -- thanks to the alertness of this company-management executive. I hate to think what the results would have been if all the firm's executives were the kind who never questioned their orders and carried them out "to the letter, regardless of the consequences!"

Naturally, I -- like everyone else who owns and controls corporations -- have a great interest in management personnel selection. I believe there are certain universally applicable criteria by which a business executive's potential value to a company may be weighed.

I don't pretend that my personal yardsticks are infallible, but they are very similar to those used by a great many other successful businessmen, and they have proved fairly accurate through the years. Much of my own business success is due to my executives' loyalty and efficiency; thus I think it reasonable to assume that the criteria by which they were chosen and promoted are reliable.

How do I judge whether or not a man is -- or would be -- a good executive? I hold that the first acid test of an executive is his ability to think and act for himself. He should have the intelligence and ability to originate ideas, develop plans, implement programs, solve problems and meet situations without running constantly to his superiors for advice. In my opinion, a man who cannot do these things is not an executive. He is a glorified office boy.

Years ago, when I asked a leading American industrialist how he visualized the perfect management team, he conjured up the following picture of a businessman's nirvana:

"My executives would be men I could call into my office at nine A.M. on January first and tell them: 'Look, boys, the company has been making sausage skins for years. Last year, our profit was a million dollars. This year, I've decided that we stop making sausage skins and start turning out nuts and bolts.'

"At that, all the executives would smile, nod and file out of my office. I wouldn't see them again until five P.M. on December 31st. Then, they'd come back into my office to tell me we were producing the world's finest nuts and bolts, underselling our competitors by 50 percent -- and had tripled our profits over the previous year!"

Of course, the industrialist's happy pipe dream was just that -- a pipe dream. But it serves to illustrate the point I'm trying to make. A good executive is a man who can think and act independently and needs only the barest minimum of instruction to carry out his job.

Now, an executive's principal duty is to direct the activities -- the work -- of those under him. Direction being nothing less than another word, leadership, it follows that the good executive must, perforce, think and act as a leader.

Unfortunately, very few men are natural-born leaders. There is only one Churchill to a generation. But most intelligent, willing men can acquire or develop traits and qualities of leadership adequate to most situations they are likely to encounter in their careers.

As for the men who become business executives, some learn their lessons in leadership at college, others on their jobs, yet others in company-operated management-training courses. There are, of course, some who never learn -- but they are very much in the minority and seldom climb very high on any business-management ladder.

Wherever it may be that an individual obtains his lessons in leadership, he learns certain basic rules which apply with equal validity in a business firm or on a battlefield. If followed, they go a very long way toward qualifying any man for a position of leadership. Among them are these five which I, personally, consider especially important:

1. Example is the best means whereby one individual may instruct or inspire others. The man who shows them as well as tells them is the one who gets the most from his subordinates.

2. A good executive accepts full responsibility for the actions of the people under him. If called before his superiors because something has gone wrong in his department or office, he accepts full personal blame, for the fault is his for having exercised poor supervision.

3. The best leader is one who never asks anyone under him to do anything he is unable -- or unwilling--to do himself.

4. The man in charge must be fair but firm with his subordinates, showing concern for their needs and doing all he can to meet their reasonable requests. He treats his juniors with patience, understanding and respect and backs them to the hilt. On the other hand, he does not pamper them, and always bears in mind that familiarity breeds contempt.

5. There is one seemingly small -- but actually very important -- point that all executives should remember. Praise should always be given in public, criticism should always be delivered in private. Employees who have done a good job should be told so in front of their fellows; this raises morale all around. Employees who have done something wrong should be told so in private: otherwise, they will be humiliated and morale will drop.

I learned my own lessons in leadership many years ago in the tough, no-nonsense school provided by the Oklahoma oil fields. Virtually all the wildcatting operators -- including me -- knew the jobs of every man in our prospecting and drilling crews. We never asked a man to do anything we would not -- or could not -- do ourselves. Wherever possible, we showed our men what we wanted done and how we wanted them to do it.

"The best boss is one who knows the business better than I do, but trusts me -- even though he never lets me forget that he's the boss," an old-time rigger once told me. "That's the kind of man I'll really work my tail off for ..."

I think that basically every employee feels much the same way. Although few of today's executives are out in the field, sweating alongside their work crews, the old, tried-and-proved rules still hold. I believe that the most successful executives are those who follow them implicitly.

Yet another quality I seek in management personnel is the ability to communicate. Time is money in business; misunderstandings in the interpretation of requests, reports or instructions can prove very costly. Thus, the good executive is one who can explain things and tell people what needs to be done quickly and clearly.

Interest and enthusiasm are two more qualities a good executive must possess. No man can properly do a job in which he is not interested. An executive's interest must go far beyond the limits of his own particular department or office.

It is essential that he know what goes on in other departments and that he be completely conversant with the company's policies and overall activities. Only thus can he evaluate the role and relative efficiency of his department and relate its operations as a functioning part of a functioning whole to the other parts and to the whole itself.

Then, his interest should go even further: to embrace the entire field or industry in which his company operates. Only if he knows the field can he understand his company's strengths, weaknesses and problems.

But interest alone is not enough. There must also be a strong element of enthusiasm in his attitude. I hardly mean any hip, hip, hooray! variety of enthusiasm. I've never gone along with the school of thought that calls for sales meetings to open with rousing company songs.

What I do mean is that an executive should thoroughly like his work. He should -- starting with the operations of his own department -- actively seek ways whereby his firm's efficiency, production, sales and profits may be increased.

Loyalty -- another important quality in executives -- can only be recognized and judged after it has been demonstrated. The executive's loyalty should not be to any individual -- but to the stockholders, employees, his associates, superiors and the company as a whole.

These, then, are the characteristics which I believe are the most important for business executives to possess. Doubtless, some readers will be surprised by the fact that I've left out such things as personality, education and technical knowledge. But, on closer analysis, it should become clear that these are not really as basic or important as those qualities I have mentioned.

I'll agree that an individual with a completely negative personality can hardly expect to achieve success in any position which calls for him to work with people. On the other hand, an executive's job is to run his department, not to run in a popularity contest.

As for education, it depends largely on how one is using the term. I've found there are many top-quality business executives whose formal education stopped at high school or even grade school. What they know, they taught themselves.

There is much knowledge a good executive should possess, but he does not necessarily have to obtain it at a college or university. Although a good, solid formal education is usually a great help to a man who wants to be a good executive, I don't believe that it is essential.

Technical knowledge? I'll admit that in this day of complex industrial and business technology, every executive needs a greater degree of technical knowledge. But the kind and amount depends largely on what he is doing and where he is doing it. I can sum up my views on the subject by saying that I'd rather try to make a good technician out of a good executive who has no technical knowledge than try to make a good executive out of a good technician who has no executive ability.

Among other traits I imagine most laymen would list as being desirable in executives are such things as honesty, industry and imagination. I have purposely omitted these and several others because I consider them to be self-evident and think it is superfluous to mention them. Certainly, no businessman in his right mind would ever hire an executive if he had the least suspicion that the man was dishonest, lazy or unimaginative.

There's really no magic or secret to being a good executive. I think any man who has the qualities I've listed, sincerely wants a business career and will work and apply himself can become a good executive. Such a man would most certainly fit most successful businessmen's requirements for management personnel. He would most certainly fit into almost any firm in almost any industry. In my opinion, his career would be assured. He would, in short, have it made in the business world.