Two Paths to the Top

This Past Fall, it was estimated that there were some 120,000 millionaires in the United States --105,000 more than there had been in 1948. This astounding 700 percent jump in the number of American millionaires in 21 years forcefully underlines what I have so often reiterated in my articles in Playboy: There is more opportunity to achieve success in business today than at any previous time in history.

Countless business leaders agree, predict even bigger and better things yet to come and are banking immense amounts of capital on their predictions. The essence of all such prophecies has been boiled down into two simple, but striking, sentences by Charles Bates ("Tex") Thornton. "There's really no place to stop," he has declared. "We will never reach our destination."

Thornton's statements can hardly be taken lightly. He is the head of Litton Industries, a titan of the business world that, according to published accounts, "made him a millionaire 40 times over ... and made millionaires of 20 other Litton executives" in a single decade.

It should be obvious what these statistics and prognostications mean for the beginner in business. Today's college graduates and budding executives can embark on business careers confident--if a play on words is permitted--that in this space age, the sky is no longer the limit.

Not only does our present era offer unprecedented opportunity but the tyro is given an infinite choice of immediate opportunities for starting and building his career. The worried college grad of yesteryear who, diploma in hand, wandered forth from the groves of academe to search desperately for a job--almost any job--is but a faded memory. Nowadays, corporate mountains come to seek matriculated Mohammeds long before graduation day. Management recruiters for the nation's executive-hungry companies are familiar figures on college campuses--and they scrutinize likely candidates as covetously as professional-football scouts eye star quarterbacks.

A promising young man can all but write his own ticket. A dozen or more firms will vie for his services, offering him starting salaries that may well go into the five-figure range. There is certainly no need for him to grab blindly; he need only accept the offer that attracts him most.

On the job, the novice may expect to receive every aid and assistance, not only in acclimating himself to his new environment but also in training and grooming himself for rapid promotion. If he demonstrates ability, he soon finds other companies and executive head-hunters wooing him with promises of more pay and perquisites, greater responsibility and better prospects for even further promotion.

In over 50 years as an active businessman, I've never seen anything to equal the currently prevailing climate of opportunity. But there is little need for additional prefatory comment. I assume anyone reading this article is already aware of the range and number of employment opportunities available to young executives.

However, although the ointment is rich and practically fly-free, the tyro is confronted by one very important choice even before he gets up to the starting line: Is he a big- or a small-business type? It is this problem--which has received comparatively little general attention--that I intend to explore.

Where would the budding executive function best and most fully realize his potential--in the highly organized, structured work situations found in most giant corporations or in the less formal environment usually characteristic of smaller companies?

These questions are seldom asked and even less frequently (continued on page 142) Two Paths to the Top (continued from page 133) probed and analyzed to the extent they deserve. Each year, very large numbers of men leave college and go automatically into big business.

"One reason why seniors prefer big business is that the big companies go after them and the small ones don't," William H. Whyte, Jr., has written.

Furthermore, it has been my experience that both executive job seekers and recruiters are often prone to ignore varying individual potential quotients vis-à-vis big versus small business.

True, there are many men who, because of their nature, intellectual and emotional patterning and a host of other factors, are best fitted to work for large corporations. They function more efficiently, advance more rapidly and are personally more content in structured work situations, interacting with others as part of a complex organization. They are content to be cogs until they can become progressively larger gears--and, hopefully, at last the generator--in the intricate machinery.

There are multitudes of fine big-business executives, and innumerable large and eminently successful companies would not consider employing managers of any different stripe. Like it or not, the combination of organization man and structured organization does often work very well. Some of the nation's most tightly compartmented corporations are among the ones that show the highest earnings and profits and continue to grow steadily.

An able executive suited to structured work situations has an excellent chance of achieving success in a large company. If nothing else, the depth and definition of the vertical lines on the organization chart guide his course, preventing him from straying into unmapped--and, for his nature and temperament, alien and hostile--terrain. Although I have no statistics, it is a certainty that a sizable number of America's millionaire businessmen reached the magical seven-figure bracket step by step, via the strictly structured path.

On the other hand, there is a diametrically opposed species of individual much more likely to succeed in a small business environment. The Harvard Graduate School of Business Administration is one leading educational institution noted for recognizing and encouraging men of this type. Its Student Small Business Placement Program (S. S. B. P. P.) has done yeoman work separating the small-from the big-business types and helping the former find their way into work situations for which they, their personalities and potentials are best fitted. The underlying principle of the program is that many an executive whose qualities would make him an outstanding small-business manager is stultified and rendered impotent in a big-business atmosphere.

S. S. B. P. P. spokesmen argue there are three general categories of small-business executives: those who excel in small business per se; those whose forte is small management, in big business or small; and those who'd do best buying equity in a small firm and managing it themselves.

Professor Myles L. Mace, of the Harvard Graduate School of Business Administration, maintains that many business students abhor the thought of "becoming nothing more than serial numbers in a large organization." And, he says: "They have an abiding fear that they will not have a chance to demonstrate their abilities in an environment that will recognize their contributions. They don't think this can be done in a large company.... It is not entirely true, but ... they think it is."

Frank L. Tucker, dean of the Faculty for External Affairs of the same institution, declares: "It is my firm belief that some people were born to be in small business. They have a certain kind of personality that wants a wide scope for its abilities ... a strong desire for freedom and independence and, at least sometimes, a desire to make a lot of money fast."

Obviously, every aspiring executive cannot attend the Harvard Graduate School of Business Administration and benefit from its Student Small Business Placement Program. However, just about any intelligent neophyte manager can go a considerable way toward determining for himself whether he is best fitted for big business or small.

He may avail himself of the sophisticated aptitude and psychometric tests that can provide insights into the size and kind of business operations that would be most compatible and offer the greatest degree of dovetailing corporate and personal needs and motivations--and, hence, the best milieu in which to grow. These personal audits, voluntarily and privately taken, are a very far cry from the automated and mechanized tests that seem to reject men of independent spirit and, instead, favor specimens of that stock figure, the organization-man drone.

In any case, the tyro should make a careful, detailed--and, above all, honest--study and appraisal of himself. During the five decades of my own business career, I have frequently observed that all too many men know less about themselves than they do about almost any subject under the sun. And, whatever knowledge they do possess about themselves, they are virtually inarticulate when it comes to describing or discussing it. Long ago, I hit upon a variant of an old childhood game to gain some insight into the personality of applicants for executive positions. Once an interview with an individual began, I asked the following question:

"If you were required to describe yourself and your views and attitudes on business in three sentences and no more, what would those sentences be?"

The answers I have received have run an encyclopedic gamut, and spate doesn't permit the digression that would be necessary to discuss them even in the sketchiest manner. However, they provided reliable indications of the individual's true personality and innermost thoughts--if for no other reason than that it is human under such circumstances to state first things first. And the replies generally showed whether the applicant was basically more inclined to thrive in structured or in less formal work situations.

An aspiring business executive's personal inventory should be complete. For. as one management consultant was quoted in Nation's Business as saying: "If you do not have a carefully detailed career plan, and most people don't, you will do well to analyze all phases of your situation as objectively and completely as possible."

And, I might add, the analysis should be examined in light of the two contrasting work situations offered by big business and small. Naturally, if the personal inventory is to have any value, the individual must be familiar with the key characteristics of each sector of business. I've already touched upon a few. It might be well to examine these and some others more closely.

Let's start with big business. Unquestionably, large companies offer more safety, security and shelter than small ones. All other things being equal, it stands to reason that a corporate behemoth with annual sales of a billion dollars is less likely to have worries about the future than a firm that grosses, say. $1,000,000 a year. The former is better fixed than the latter to roll with the punches of temporary setbacks or to ride out economic storms.

The security factor extends all the way down to the most junior executive. In many giant corporations, even a manager of mediocre ability may enjoy a considerable degree of job security. Being one among many, his faults and failings will not be too noticeable. In some huge companies, an executive who survives his first two years or so just about enjoys job tenure. He may not get very high on the ladder, but he can cling to some rung with relative ease. Then, many large firms offer virtually automatic pay raises, bonuses, profit sharing, long vacations, stock options, hospitalization plans, retirement plans and other benefits appealing to the security minded. Admittedly, some of these aren't of paramount interest to truly enterprising men, but there are more positive attractions for them.

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Bigness itself often exerts a strong draw. Some years ago, I was much impressed by the evident potentials of a young man who intended making a business career, and I offered him a job with one of my firms. "No, thanks," he shook his head. "Since I've made up my mind to climb, I want to tackle the biggest pyramid I can find."

He obtained a bottom-layer executive job with one of the nation's ten largest corporations--and is now one of its vice-presidents. We've remained friends and, when he was in Europe recently, he stopped to see me in England. He told me he never regretted his original decision. "At each stage, I felt I'd accomplished more than if I'd reached the next higher level in a small organization," he said. "Maybe the competition hasn't been as stiff as it would have been in a small firm--but there was much more of it, and that's always made each success seem greater and more gratifying."

Most huge companies have widely scattered branches and subsidiaries. More than a few executives state that this aspect appeals strongly to them. It is understandable. There is excitement, even adventure in being rushed out to take over the Tokyo office or to clean up the mess that has suddenly developed in the Caracas plant. Other advantages enjoyed by big-business managers are the facilities, expert advice and scientific and technological aids at their disposal. These are seldom equally available in small companies.

But big business has drawbacks, too. The executive must, to some degree, submerge his individuality in that of the organization; while he need not become a faceless number, he will not give many virtuoso performances, either. Cog, little gear, big gear or even generator, he remains part of a complex apparatus that, by its very nature, cannot always function with optimum speed and smoothness.

A familiar big-business handicap and source of executive frustration is that, even at best, the structured organization is still likely to be cumbersome. For example, in such a company, it's seldom possible to find one man who can quickly give an answer or make a decision. "In a big outfit, it takes three days to round up the three committees that'll spend the next three weeks mulling the question at hand," a veteran entrepreneur grumbled to me not long ago. This, of course, is an exaggeration; but the behemoths do frequently get bogged down in procedural rules, committee meetings and other forms of folderol that cause able, imaginative managers to lose--or tear--their hair.

Organization also tends to proliferate administrative departments, paperwork and red tape, reducing flexibility and eventually leading to hardening of the company arteries.

Small business offers the success-seeking executive an entirely different mix of advantages, disadvantages, problems and challenges. For instance, the small-business executive won't be a specialist for long, since the company's size will not permit honeycombed compartmentalization. He may spend a year in production, then shift to merchandising. Or, after he has acquired a little seasoning, he may well find himself wearing several hats at the same time.

I know this from the early days of my own career. After having gained a bare sufficiency of all-round experience, I became a small--a very small--businessman in the oil fields. As such, I was my own drilling superintendent, purchasing agent, salesman, bookkeeper and just about anything else one could imagine. Had they actually existed, my various hats would have filled my cubbyhole office from floor to ceiling and wall to wall.

The small-business manager seldom enjoys as much security as his big-business counterpart, but he usually has more independence. This is not pure blessing, for he consequently carries a greater load of personal responsibility, with attendant risks to his job and career. He will frequently need to make his own decisions and may often feel very much out on a sagging limb if he has made a serious mistake.

Withal, there is liable to be greater operational efficiency in a small firm than in a large one. In the former, it is usually possible to find that one man who can say yes or no on the spot. The individual in small business has a far greater chance to exercise his individuality and initiative and to innovate and improvise. The small company is seldom wagged by its administrative tail; a telephone call or a five-minute chat will often accomplish what would require endless memorandums and committee meetings in a giant-sized firm.

Parenthetically, it is interesting to note that some huge concerns concede all this and are seeking to find happy mediums. "Many [large corporations] are doing effective concrete things to stimulate the creative atmosphere of small business," says Harvard Graduate School's Professor Mace.

Often cited as examples are W. R. Grace and Company and Thiokol Chemical Corporation. The former has many divisions, subsidiaries and partly owned companies, each of which is said to enjoy a remarkable degree of autonomy. The latter is credited with wedding the best of the big and the small through a project-management method.

Let me emphatically state that I acknowledge the achievements of the nation's great, structured organizations and am aware of the many production and distribution miracles they have performed. However, I, personally, have always remained at heart a small businessman. My associates and I have consistently sought to maintain small-business flexibility, creativity and efficiency. As an example, one of the companies in which I hold a substantial interest employs an over-all total of 450 people. A competing firm does about five times the gross business--but has 400 paper-pushing employees in its administrative offices alone. The difference is that the executives of my company operate in a loosely organized, highly flexible manner. Believe it or not, the firm does not even have a formal organization chart. Each manager knows his job, does it and couldn't care less what title, if any, is painted on his office door.

But what works well for J. Paul Getty and his associates may not work at all for the next man. Each person must determine which type of business shoe fits him best and will carry him farthest. Unfortunately, there arc no infallible gauges for the novice; but I do think that some reasonable, helpful departure points can be provided. An intelligent young man may check these against his personal inventory and begin to form some conclusions about which of the two paths--the big- or the small-business route--he wishes to follow.

1. As a rule, giant corporations tend to offer structured work situations. Employed by such firms, the young executive will have greater security than in small firms, but he must keep a rein on his individuality. He will, in most cases, be required to conform, to play the game according to the book. He must, at least in the beginning, accept the fact that he is more or less anonymous and should not be dismayed to find himself in the type of work situation Professor Mace has called "the civil service of big business."

2. Generally, structured organizations produce specialist executives. Big companies offer ample opportunity for advancement, but prospects of gaining wide experience or a broad business perspective are not as good as in smaller companies.

3. The average manager in the average large corporation needs to restrain many of his impulses to make independent decisions or to take unilateral action. He is always restricted to some degree by company policy that may well be formulated in a home office located 2000 linear miles away and 1,000,000 light-years away insofar as his immediate problems are concerned. Such restrictions are counterbalanced by the fact that if something goes wrong, the chances that his head will roll are greatly reduced.

4. The small company will usually allow the neophyte manager to show and exercise his individuality. The executive will be bound by fewer rules--and he will encounter many situations in which he will have to make his own rules as he goes along. But remember, the smaller the group, the more clearly visible is each individual in it and the easier it is to observe his actions, good, bad or indifferent.

5. In a small business, a manager is likely to learn quite a bit about what goes on in departments other than his own. His experience will be much broader than that of the specialist; but even this presents dangers. A man establishing an excellent record in, say, two different departments and then, for whatever reason, failing in a third may find his earlier achievements forgotten and learn that his one strike is enough to put him out.

6. In sum, the manager in a small business will have to do much of his own thinking, decision making and implementing of those decisions. But, while he may get credit for his accomplishments, he will certainly have to take all the consequences for his blunders.

There are advantages and disadvantages to any work situation. Only the individual himself can make up his mind which sector--the big or the small--appeals to him most and promises him the best chance of proving himself and achieving success.

Luckily, under the business conditions that prevail--and that I believe will continue to prevail throughout the foreseeable future--the beginner's initial decision does not imply a lifetime commitment. Nowadays, the executive who spends all or even a major portion of his career with the same company is a rare bird, indeed. It is a universally accepted fact of business life that modern managers maintain a high degree of job mobility, particularly in the early stages of their careers. "Changing jobs is part of one's own selective process," declares Alan Wolfley, financial vice-president of Scovill Manufacturing Company.

Personnel-selection specialist Jack H. McQuaig went as far as to write: "It is perfectly normal for a man to try four or five different jobs in his first three or four years at work." Frankly, I think that's carrying the job-mobility concept a shade too far. I'd be inclined to view a manager who'd held five different jobs in three years with skepticism, if not downright suspicion. However, the young executive will move around during his first few years; and, as long as he does it within reason, no prospective employer will think the less of him for it.

Thus, if a budding executive adds up all the credits of big and small business and he still cannot arrive at a clear-cut decision, he can certainly accept what appears to be the happier compromise in either sector. If, after having given both the job and himself a fair trial, he finds he'd rather work in a structured organization than in a small company, or vice versa, he can always shift.

After trying both the big and the small, he should have a clear picture of what he has to gain or to lose in each type of work situation and which fits his nature and personality better. The same holds true for the man who does make a definite initial decision and chooses, for instance, small business and then discovers that he's made a mistake. He, too, can always change.

Once the individual finally determines which of the twofold paths to success will allow him to travel the farthest and fastest, he is well on his way to the top. Provided he has what it takes to make the climb, he will reach his goals along either route.

The opportunities are all there, waiting for those--be they big- or small-business oriented--who will make the most of them. America's rapidly multiplying millionaires prove that beyond the shadow of a doubt.