Yesterday’s post here about med students who spend time as “patients” in nursing homes brought to mind another example of learning on the job.

It comes from the 1970 management classic, Up the Organization,  by Robert Townsend.

Townsend became CEO of Avis Rent A Car in 1962.  The company had not made a profit in thirteen years.  By 1965, Avis increased its sales 150% and had annual profits of $1 million, $3 million, and $5 million.

I’ve had my copy (see photo) for years; it originally belonged to the General Motors legal staff library.  (Maybe they never read it.)

It wasn’t much work to find this particular passage and the accompanying footnote:

Before you hire a computer specialist, make it a condition that he spend some time in the factory and then sell your shoes to the customers.  A month the first year, two weeks a year thereafter.  This indignity* will separate those who want to use their skills to help your company from those who just want to build their own know-how on your payroll.

* Everybody including the chief executive had to go through the Avis rental-agent training school.  I once saw the Ph.D. who was responsible for all Avis systems panic and run from an O’Hare rental counter at the approach of his first real customer.

Townsend was blunt, wry, and pragmatic.

Probably whenever Sitting Bull, Geronimo, and the other chiefs powwowed, the first topic of conversation was the shortage of Indians.  Certainly today, no meeting of the high and the mighty is complete until someone polishes the conventional wisdom: “Our big trouble today is getting enough good people.”

This is crystal-clear nonsense.  Your people aren’t lazy and incompetent… They’re beaten by all the overlapping and interlocking policies, rules, and systems encrusting your company….

Do you know what they have to go through to hire somebody–or buy something?… It’s your fault they’re rusty from underwork.

From the chapter on Office Hours:

Anyone who makes over $150 a week should be allowed to set his own office hours.  Many will conform to the traditional 9 to 5 but it should be their choice.  A few will set hours that reduce their effectiveness and cost them their jobs.  Overall, it’s worth it.

From Organization Charts: Rigor Mortis

[Organization charts] have uses: for the annual salary review; for educating investors on how the organization works and who does what.  [Otherwise] a chart demoralizes people.  Nobody thinks of himself as below other people.  And in a good company, he isn’t..

In the best organizations people see themselves working in a circles as if around one table.  One of the positions is designated chief executive officer, because somebody has to make all those tactical decisions that enable an organization to keep working… [But tactical] leadership passes from one to another depending on the particular task being attacked…

From People:

There’s nothing fundamentally wrong with our country except taht the leaders of all our major organizations…[have] been using the Catholic Church and Caesar’s legions as our patterns for creating organizations.

And until the last forty or fifty years it made sense.  The average church-goer, soldier, and factory worker was uneducated and dependent on orders from above.

That last chapter goes on to summarize another nearly-forgotten classic, Douglas McGregor’s The Human Side of Management. McGregor posited three assumptions he called Theory X:

• People hate work.
• People have to be driven and threatened to get them to work toward organizational objectives.
• They like security, aren’t ambitions, want to be told what to do, and dislike responsibility.

In contrast, McGregor saw (and Townsend recommended) Theory Y:

• People don’t hate work; it’s as natural as rest or play.
• If people commit themselves to mutual objectives, they’ll drive themselves more effectively than you can drive them.
• People commit themselves to the extent they see ways of satisfying their own goals (as well as those of the organization).

And just think… all this before social media.

Townsend, by the way, was the CEO who brought in the legendary We Try Harder advertising campaign.  Before you watch the next episode of Mad Men, take a look at some examples of Avis’s approach at the Sell Sell blog.