k HF 1134 ^ \9l\ UC-NRLF $B 2t.S 37^ BtiSijiaB^^m George Davidson It iUSINESS DigitiZjed by the lnterne| Archive in 20p7 with funding* froni IVIicrosoft Corporation http://www.archive.org/details/forgingaheadinbuOOalexrich Forging Ahead In Business Alexander Hamilton Institute AsTOR Place New York City Cattadian Address, C. P. R. Bldg^., Toronto. Australian Address ^ 8a Castlereagh Street^ Sydney. Copyright, 1921, by- Alexander Hamilton Institute IS^S -oil CONTENTS PAGE Foreword — The Law of Success 7 CHAPTER I The Modern Business Course and Service . . 9 II The Danger of Specializing Too Early. ... 30 III Pushing Beyond the Half-way Mark 35 IV A Personal Problem 43 V The Question Before You 69 VI Descriptive Outline of the Course 72 VII Advisory Council, Lecturers and Staff .... 97 M^4552 Organization of the Alexander Hamilton Institute Advisory Council Joseph French Johnson, D.C.S., LL.D. Dean, New York University School of Commerce, Accounts and Finance Frank A. Vanderlip, A.M., LL.D. Financier T. Coleman duPont, D.C.S. Business Executive John Hays Hammond, D.Sc, LL.D. Consulting Engineer Jeremiah W. Jenks, Ph.D., LL.D. Research Professor of Government and Public Administra- tion, New York University Special J^ecturers Erastus W. Bulkley, Member of the firm, Spencer Trask and Company Herbert S. Collins, Vice-President, United Cigar Stores Company Henry M. Edwards, Auditor, New York Edison Company Harrington Emerson, Efficiency Engineer Charles Ernest Forsdick, Controller, Union Oil Company Orlando C. Ham, Chairman of Sales, National Lead Company A. Barton Hepburn, Chairman, Advisory Board, Chase National Bank, New York Frederic H. Hurdman, Certified Public Accountant Lawrence M. Jacobs, Vice-President, International Banking Cor- poration Jackson Johnson, Chairman, International Shoe Company, St. Louis Fowler Manning, Director of Sales, Diamond Match Company Finley H. McAdow, Past President, National Association of Credit Men General Charles Miller, Former Chairman of tlie Board, Galena- Signal Oil Company Melville W. Mix, President, Dodge Manufacturing Company Emmett H. Naylor, Secretary-Treasurer, Writing Paper Manu- facturers' Association Holbrook F. J. Porter, Consulting Engineer Welding Ring, Exporter Arthur W. Thompson, President, The Philadelphia Company of Pittsburgh Frederic S. Todman, General Manager, Hirsch, Lillienthal & Company John C. Traphagen, Treasurer, Mercantile Trust and Deposit Company of New York John Wanamaker, Merchant Walter N. Whitney, Vice-President, Continental Grocery Stores, Inc. 4 Authors, Collaborators and Staff Members Albert W« Atwood, A.B., The Stock and Produce Exchange Bruce Barton, General Publicity Dwight E, Beebe, B.L., Collections Ralph Starr Butler, A.B., Marketing and Merchandising Geoffrey S. Childs, B.C.S., Office Methods Edwin J. Clapp, Ph.D., Transportation and Terminal Facilities Raymond J. Corayns, B.C.S., Personal Salesmanship Herbert F. deBower, LL.B., Business Promotion Roland P. Falkner, Ph.D., Business Statistics Major B. Foster, M.A., Banking Principles Charles W. Gerstenl)crg, Ph.B., LL.B., Finance Leo Greendlinger, M.C.S., C.P.A. (N. Y.), Financial and Business Statements J. Anton deHaas, Ph.D., Foreign Trade and Shipping John Hays Hammond, Consulting Engineer Edward R. Hardy, Ph.B., Fire Insurance Warren F. Hickernell, Ph.D., Business Conditions Solomon S. Huebner, Ph.D., Marine Insurance Charles W. Hurd, Business Correspondence Jeremiah W. Jenks, Ph.D., LI>.D., Relation of Government to Business Joseph French Johnson, D.C.S., LL,D., Economic Problems; Business Ethics Walter S. Johnson, B.A., B.C.L., Commercial Law Edward D. Jones, Ph.D., Investments John G. Jones, Sales Management Dexter S. Kimball, A.B., M.E., Cost Finding; Factory Management Bernard Lichtenberg, M.C.S., Advertising Principles Frank L. McVey, Ph.D., LL.D., Economics John T. Madden, B.C.S., C.P.A. (N. Y.), Accounting Practice Mac Martin, Advertising Campaigns G. F. Michelbacher, M.S., Compensation and Liability Insurance T. Vassar Morton, Litt.B., Credit Practice Bruce D. Mudgett, Ph.D., Life Insurance E. L. Stewart Patterson, Domestic and Foreign Exchange Frederic E. Reeve, C.P.A., Accounting Principles Jesse H. Riddle, M.A., Banking Frederick C. Russell, B.C.S., Auditing Bernard K. Sandwell, B.A., International Finance William W. Swanson, Ph.D., Money and Banking John B. Swinney, A.B., Merchandising William H. Walker, LL.D., Corporation Finance THE LAW OF SUCCESS DURING the winter of 1883 a slim, studious young man was working as assistant fore- man in a greasy little machine shop at Aurora, Illinois. He was saving money with a view to spending the next year at the State University, and he was devating every minute of his spare time to thought and reading. He was not mak- ing much of a stir in the world, and only a few of his close friends ever gave a second thought to his ambitions or prospects. One of these friends was a newspaper reporter, a recent Harvard graduate. He, too, was inter- ested in study, especially of financial questions, and he found it a pleasure to guide the reading of the young foreman. Many an evening the two friends spent in the discussion of great economic and financial problems. Though both men had their ambitions and dreams, it did not occur to either one that he would ever play a big part in solving these problems. A few years later the Harvard graduate be- came financial editor of the Chicago Tribune and brought in the younger man as his assistant. 7 During their years of newspaper work together they continued to study and think, and their knowledge of business principles and methods gradually broadened. They were fitting them- selves almost without knowing it to step forward into positions of leadership. Today, the former reporter is the head of a great university school of commerce; the assist- ant foreman became the president of the largest bank in the United States. One of these men is Joseph French Johnson, now Dean of the New York Universitj^ School of Commerce, Accounts and Finance. The other is Frank A. Vanderlip, the great financier. The life histories of most men who have suc- ceeded in a large way are equally simple. They have looked ahead, they have planned, they have equipped themselves with all the business knowl- edge available, and success has followed. Success must follow. The law of success is as definite as the law of gravity. Here it is : Prepare in advance for opportunities. It is not the dramatic moments of life that count. It is the quiet planning and reading of the man who is getting ready now for what is going to happen two, five or ten years from now. 8 Chapter I THE MODERN BUSINESS COURSE AND SERVICE AS Dean of New York University School of L Commerce, Accounts and Finance, Joseph French Johnson had for manj^ years continually received letters requesting advice on what to read on business. These demands came not only from young men, but from mature and able executives, and sometimes even from the most successful business leaders. To all such requests Dean Johnson w^as obliged to reply that the only practical way to study the fundamental principles of business in a systematic manner was to attend the lectures in university schools of commerce. At that time the literature of business was scanty and for the most part of doubtful value. Working alone, a man could get but little help in his efforts to widen and deepen his knowledge of business principles. It became evident that there was a great need 9 for an organized, logical statement of the basic principles on whidi successful business is founded. It was determined to establish an institution which should meet the demand. After years of prepara- tion the Alexander Hamilton Institute was estab- lished in 1909. The name In selecting the name, it was agreed that none could be so suitable as that of Alexander Hamilton. Hamilton is perhaps chiefly remembered for his masterly statesmanship; but he was equally conspicuous as soldier, financier, author, organ- izer and practical economist. He was without doubt the greatest manager ever employed by the United States Govern- ment. When he became the first Secretary of the Treasury, he found a chaotic government, without money, without credit, and without or- ganization. He secured order, provided funds and created prosperity. He investigated the in- dustries and directed the early commercial devel- opment of the United States. "He touched the dead corpse of the public credit, and it sprang upon its feet. He smote the rock of the na- tion's resources and abundant streams of revenue gushed forth." 10 Hamilton was a great executive and systema- tizer; he himself worked out an accounting sys- tem for the United States Government which, with but slight modifications, remained in force for more than a hundred years. The plan The Modern Business Course and Service is a systematic, time-saving method of bringing to any man's office or home that business knowledge and training which he needs, but which he can- not acquire through his own experience. It is designed for the benefit of two groups of men: ( 1 ) those who already are in executive or semi-executive positions ; (2) young men who have brains and the ambition to become business executives. y^ It is intended, in general, for the men who are looking and moving ahead ; for live, keen-witted, energetic men; for men who are not satisfied to remain in the ranks or in subordinate positions. These men may or may not have had a thorough school and college training; that is not an essen- tial. They may or may not have wealth and high position; that is unimportant. But they must 11 have ability and enough serious purpose to spend a portion of their spare time in reading a^d thinking about business problems./ The organization The Modern Business Course and Service is conducted by an organization made up of busi- ness and professional men and of university spe- cialists in business subjects. Inasmuch as such an institution derives its strength almost wholly from the men who are identified with it, a com- plete list of these men, with brief biographical notes to show who they are and what they have accomplished, is given in Chapter VII, on pages 97 to 118. The Institute organization consists of four groups : / Advisory Council >l Authors and Collaborators ^b Special Lecturers Institute Staff a. Consultant Staff b. Administrative Staff Business and educational authority of the highest standing is represented in the Advisory Council of the Institute. 12 This Advisory Council consists of Frank A. Vanderlip, the financier; T. Coleman duPont, the business executive; John Hays Hammond, the eminent engineer; Joseph French Johnson, Dean of the New York University School of Commerce; and Jeremiah W. Jenks, the statis- tician and economist. The Council has general supervision and direction of the policies and activities of the Institute. No important move of any kind is made without the sanction of this bodj^ The Authors and Collaborators are men prom- inent in educational and business circles. As authors, co-authors and collaborators they are re- sponsible for the Modern Business volumes. Their writing is done under the guidance and with the cooperation of the Institute's Editorial Board. Each one is chosen because of his partic- ular training and ability in the field he covers. The Special Lecturers^ whose business connec- tions are stated on pages 111 to 118, are men of high commercial standing who have devoted time and thought to preparing written lectures for the Modern Business Course and Service. These lectures present some of the results of their successful business experience. 13 The Imtitute Staff actively conducts the Mod- ern Business Course and Service. Many of the members of the Staff are also members of the faculties of university schools of commerce. Every member of the Staff is a specialist who in some one business subject is entitled to rank as an authority. Their names, business and uni- versity connections and official duties in the Institute are stated on pages 100 to 110. (a) The Consultant Staff are the experts who do not give their entire time to the Institute, but who are called upon for special information and advice ^\iienever the occasion requires. (b) The Administrative Staff consists of the Senior and Junior Executives who are active in the administrative work of the organization. These men are heads of the departments respon- sible for the successful management of the Alex- ander Hamilton Institute. Subjects covered The Modern Business Course and Service brings to a subscriber the essential business knowledge that he does not acquire in his own experience. The subject matter of the Cour-se 14 and Service is treated under the fcdlowing 24 heads : 1. Business and the Man 2. Economics — ^the Science of Business 3. Business Organization 4. Plant Management 5. Marketing and Merchandising 6. Salesmanship and Sales Management 7. Advertising Principles 8. Office Administration 9. Accounting Principles 10. Credit and Collections 11. Business Correspondence 12. Cost Finding 13. Advertising Campaigns 14. Corporation Finance 15. Transportation 16. Foreign Trade and Shipping 17. Banking 18. International Exchange 19. Insurance 20. The Stock and Produce Exchanges 21. Accounting Practice and Auditing 22. Financial and Business Statements 23. Investments 24. Business and the Government 16 Simple, elastic, workable The Modern Business Course and Service covers the essential subjects on which every busi- ness man should be Avell informed. \^Tien an enrolment is accepted, the Institute undertakes, 1. To supply the subscriber with the Modern Business Text — the most com- plete and best organized treatment of business principles and practice that has yet been produced. 2. To guide and illuminate his read- ing of the Text by a series of Modern Business Talks. 3. To bring Mm into touch with the ideas and methods of some of the fore- most business and professional men in the country through a series of Modern Business Lectures. 4. To give him facilities for applying and testing his loiowledge of business principles through a series of Modern Business Problems. 5. To keep him informed on current business events and the trend of future affairs in the commercial world by means of Monthly Letters on Business Conditions. 6. To acquaint him with important 16 The twenty-four volumes of Modern Busi- ness Texts are printed on dull finished paper and bound in Flexible Fabrikoid. Each vol- ume is Si/s X 7l^ inches in size and contains about 350 pages. They are adapted for con- stant use, can be slipped into the pocket and carried without any trouble. The volumes in themselves constitute a complete business librarv. Cost Records as Profit Makers The business that does not watch its costs is likely to have no profits to watch. TALK No. 19 (WITH VOLUME 10) ALEXANDER HAMILTON INSTITUTE NEW YORK This shows the cover of one of the Talks in the Modern Business Series. You receive one of these Talks every two weeks with either a Modern Business Lecture or a Mod- ern Busixjpcs Problem. BUILDING AN ORGANIZATION By MELVILLE W. MIX LECTURE No. 4 ALEXANDER HAMILTON IN^ITUTB N£W YORK Prominent business men write these Modern Business Lectures, showing from their own ex- perience how the principles treated in the Texts have been successfully applied by them. The solution of the 24 Modern Business Problems is optional with the subscriber. When he sends in his solution, the subscrib- er receives in return a personal letter of crit- icism and suggcsticns, together with a Model Solution of the Prob- lem. ALEXANDER HAJIILTON INSTITUTE Model Solutiok to Problem 20 Question 1 Any of the several activities named are, when pursued without intelligence and knowledge, nothing more than gambling. The essence of gambling is guess, and the essence of guess is risk. Guess and risk are present in some propor- tion in every pecuniary activity. Business can be so con- ducted and is being progressively so conducted as to reduce them to ft negligible minimum. Investment, since it deals chiefly in bonds and preferred stocks, is still more conservative in aiming at security. Speculation involves considerable risk. It is possible, how- ever, to be 80 painstaking in gathering information, so cau- tious in buying and so moderate in profit-taking as to be virtually an investor. Comparatively few speculators arc of this conservative type. Too many fail to fit themselves to be true critics of conditions and instead give themselves over to hoping and guessing. With them, of course, the risk is high. Manipulation of the ordinary type involves small risk for those practicing it, though it is generally costly for the outsiders, the socalled "lambs." Manipulation, when at- tempted on a large scale has almost always come to grief. Gambling, as before intimated, is all risk. Its only bases are snap judgment and the law of chances. When it begins to study laws, condition*, tendencies, it ceases to be gambling. Coming as they do every month, these Letters contain so concise and authoritative a summary of all importatit factors affecting current business that they are proving of immense practical value to our subscribers. fINANGUL AND TRADE REVIEW AlexanJcr Hamilton Ia«titttt« Since Dtccmber 21, nilroad bonds have ihown mi average rceorcry of aboat 6 points foUowed bj * w Mlioa of 8 p^aU; railroMi stoclu ha** rccorcred Bcarly 8 pmaU aad Noeted fran 8 to 4 poiDU; tbe active indnitrial atoda have reco wr ed 10 to IS point* aad reacted from S to 8 pobtfc la gcMral it nay be ■aid tbat tbe reecat rcacttoa baa ttnooated to only about one^uarter of tht recoroj (iaet tbe Oeecmbir loir level Financial opinioa it leaning to*ard tbe bdicf tbat Ibcrc will be no fortber dediaei of coaeeqacaee until after tbe. iaaognration and tbat perbap* no important level Tbe reaioat for tbia eentiment aic tbat tbe large iatcmti wbo accumulated stock* quite beaviljr thruout November and December liavc no dcure to idl out until the market ba* rises tea or fifteen points evca if it ia^neeessarjr to wait for a considerable time. Meaa- wbilc tbcy will support quotation* ratber strongly against bear raids. It is expected, furtbermore, that investors who were able to bold stock* thru tbe slump in Deocinber will not be inclined to part with tb^ at an earl; date. Consequently, altbo trade report* are bud, there is Ijttlc room for any heavy slump in stock* in view of the class of people who now own most of them. There are very few speculative account* whicb arc not stron^y protected with cash. Another reason for underlying strength is tbe fact that the improvement in the combined statement of the twelve Reserve Banks has been maintained and it i* not improbable that the "reserve ratio," which ha* al- ready recovered to 49 per cent, may rise to 05 or 60 |>er cent next Summer. This barometer of general con- ditions just now is being given more attention tbaa tbe Cai>jrriyil /llnnulfr llfmillon /imIi(«<«, I9tt. local situation in New York, which is still very bad owing to the fact that Wall Street has become more and more an agricultural banking center and Its* and let* an invettmeot center during the past two yean. In WaU Street, loan* on *tock* and bonds are far be* low normal, while tbe loan* to country bankers and merdiants in the South and West are far above normal. In view of this titnatloa it it ratber surprising that tbe Comptroller of tb* Currency, in his recent and Ittt annual report, tbould tell tbe country that the high moaey ratct charged by tbe New York banks have been tbe eaote of financial ttringeacy. Tbe truth is that the Sooth and West induced tbe New York banks to go beyond normal limit* m lending by bidding higher aad higher rate* to get funds. The high rates have beta offered from the outside rather than charged in New York. The point relating to the market outlook is that credit in New York is still ediagttcd owing to *'f rotea" loan* to the interior. It it encouraging, however, tbat Bquidatioa ia tb* Wctt ha* progretted mflieiently to improve the coodi- tioa of tb* Chicago and St LooU Federal lt***rve Baakt aad it b quit* eertam that the wont of th* draia oa Wall Street from ICnneapoIis, Kansas City. Dalla* aad AtlaaU i* over. ConsequenUy, even tho tbe New York baak* are *till m a weak position, the teadeaey will b* for gradual imp rovement in the bank- ing ponttoa. For thi* reason the policy adopted by iavestor* geaerally is to boU for the long pull ia cs- pccUtioa of better price* after the bosines* diOcultit* of tb* first Jiatf of 1981 have been adjoated. Union Pacific and Atchison made tbe strongest (bowing, relative to their prices, in the fourth quarter of 1920. Southern Pacific, Canadian Pacific, and Ddaware and Hudson were able to show good profit*. lOinoi* Central made a good report. Among the roads in "fair credit," Chesapeake and Ohio and Colorado and Southern reported large profit* and *howed such a substantial margin above interest diargcs tbat they will deserve a place among the road* having "good credit" if the present earnings can b* maintained^during the next year or two. Among the roads which have traditionally belonged in the "poor credit" group, Missouri Pacific and Texas aad Pacific make tbe best showing. 3 These reviews are issued monthly. Each review covers the cur- rent security market and analyzes securities, both individually and by groups. It discusses topics of business legislation and impor- tant current events and covers the production and prices of gen- eral commodities in a way which enables one to judge the trend of commodity prices. «-^-p^^o%?TrT:«s' EXCESS MODERN BUSINESS REPORT LIST AlexancUt Hamilton Institute A»tor PiKe New York City REPORT No. 7 A--:::^^^^'" These reports cover specific problems and are replete with forms and illus- trations; they sliow how a particular problem has been worked out and are tlie result of special investigation. events covering the production and prices of general commodities and the current security market. 7. To supply him with four Modern Business Reports on important prob- lems ; the reports to be selected by him from an extensive list. 8. To render personal service through answ^ers to all inquiries in connection with his reading of the Course. An enrolment for the Modern Business Course and Service covers a period of two years. Dur- ing that time each subscriber is constantly in touch with the members of the Institute Staff. There are no rigid rules — no red tape — to restrict or annoy ; instead, there is personal guidance and sincere cooperation. The more carefully you consider the plan, the more clearly you will see how well it is adapted to the needs of busy men who must make every minute and every ounce of effort produce the greatest possible results. You will see more clearly the actual scope of the Modern Business Course and Service if you keep in view its eight main features : 1 — Text 5 — Monthly Letters 2— Talks 6 — Financial and Trade 3 — Lectures Reviews 4 — Problems 7 — ^Reports 8 — Service 17 1 — ^Text The basis of the Course and Service is a series of twenty- four text-books prepared under the careful supervision of its editors, assisted by well-known authorities. In some cases the latter appear as authors, in others as collaborators in the preparation of the Texts. Dean Joseph French Johnson is Editor-in-Chief of the Course. The managing editor is Dr. Roland P. Falkner. Associated with them is a large editorial staff which takes an active share in the writing and preparation of the Course. The authors and collaborators are specialists who rank as authorities in their particular field. The series is widely recognized as the most important contribution yet made to business literature. The volumes in the Modern Business Series are sold apart from the Institute Course only to universities for use as prescribed text-books in classroom work. Among the universities which have used the Institute's volumes as texts are: Boston University Brown University- Cedar Crest College Coe College College of the City of New York College of William and Mary Colorado College Columbia University Cornell University Dartmouth College Denver University Drake University Duquesne University Elmira College Georgetown University Georgia School of Technology Grinnell College 'iansas State Agricultural College Lawrence College Marquette University Miami University Middlebury College New Hampshire College New York University Northwestern University Ohio State University Ohio University Oregon Agricultural College Pennsylvania State College Purdue University Queens University 18 Rose Polytechnic Institute South Dakota State College State College of Washington Syracuse University Toledo University Trinity College Tulane University Vanderbilt University Virginia Polytechnic Institute University of Alabama University of Akron University of Arizona University of British Columbia University of California University of Chicago University of Cincinnati University of Colorado University of Illinois University of Indiana University of Iowa University of Kansas University of Michigan University of Minnesota University of Nebraska University of Oregon University of Pittsburgh University of Texas University of Washington University of Wisconsin Washington and Lee University Yale University There are about three hundred and fifty pages in each o£ the twenty- four volumes. Each volume is carefully indexed and contains, in addition to the text, a few review sugges- tions after each chapter which are of great value in mas- tering the subject. Questions of Commercial Law as they affect each subject are discussed in the volume pertaining to that particular unit of the Course. Business and the Man Volume 1 By Joseph French Johnson, D.C.S., LL.D., Dean of New York University School of Commerce, Accounts and Finance ; Chairman of the Advisory Council, Alex- ander Hamilton Institute. Economics — the Science of Business Volume 2 By Joseph French Johnson, D.C.S., LL.D., in col- laboration with Frank L. McVey, Ph.D., LL.D., Pres- ident, University of Kentucky. Business Organization Volumes By Charles W. Gerstenberg, Ph.B., LL.B., Professor of Finance, and Head of the Department of Finance, New York University School of Commerce, with the collaboration of Walter S. Johnson, B.A., B.C.L., Member of the Bar of the Province of Quebec, Lec- turer on Railway and Constitutional Law, McGill Uni- versity, Plant Management Volume ^ By Dexter S. Kimball, A.B., M.E., Dean, Engineer- ing College, Cornell University. Marketing and Merchandising Volume 5 Prepared by the Alexander Hamilton Institute in col- laboration with Ralph Starr Butler, A.B., Advertis- ing Manager of the United States Rubber Company, 19 and John B. Swinney, A.B., Superintendent of Mer- chandising, Winchester Stores. Salesmanship and Sales Management Volume 6 By John G. Jones, Vice-President and Director of Sales and Advertising, Alexander Hamilton Institute. Advertising Principles Volume 7 By Herbert F. deBower, LL.B., Vice-President, Alexander Hamilton Institute. "^ Office Administration Volume 8 By Geoffrey S. Childs, B.C.S., Office Manager of the Alexander Hamilton Institute. Accounting Principles Volume 9 By Frederic E. Reeve, C.P.A., and Frederick C. Russell, Controller, Alexander Hamilton Institute. Credit and Collections Volume 10 By Dwight E. Beebe, B.L., Director of Service of the Alexander Hamilton Institute, and T. Vassar Morton, Litt.B., Bursar, Alexander Hamilton Institute. Business Correspondence Volume 11 By Charles W. Hurd, Associate Editor, Alexander Hamilton Institute, in collaboration with Bruce Bar- ton, President, Barton, Durstine & Osborn, Inc. Cost Finding Volume 12 By Dexter S. Kimball, M.E., Dean, Engineering Col- lege, Cornell University. 20 Advertising Campaigns Volume IS By Mac Martin^ President of the Mac Martin Adver- tising Agency. Corporation Finance Volume 14 By William H. Walker^ LL.D.^ Dean of Duquesne University School of Accounts, Finance and Commerce. Transportation Volume 15 By Edwin J. Clapp, Ph.D., formerly Professor of Economics, New York University. Foreign Trade and Shipping Volume 16 By J. Anton deHaas, Ph.D., Professor of Foreign Trade, New York University. Banking Volume 17 By Major B.'Fostisr, M.A., Assistant to the Executive Committee, Alexander Hamilton Institute, in collabora- tion with Jesse H. Riddle. International Eccchange Volume 18 Prepared by the Alexander Hamilton Institute in col- laboration with E. L. Stewart Patterson, Superin- tendent of the Eastern Townships Branches, Canadian Bank of Commerce. Insurance Volume 19 Prepared by the Alexander Hamilton Institute, in col- laboration with Edward R. Hardy, Ph.B., Lecturer on Fire Insurance, New York University School of Com- merce, Assistant Manager, New York Fire Insurance Exchange; S. S. Huebner, Ph.D., Professor of Insur- ance, University of Pennsylvania; G. F. Michel- bacher, M.A., Actuary of the National Workmen's 21 Compensation Service Bureau, and Bruce D. Mudgett, Ph.D., Associate Professor of Economics, University of Minnesota. The Stock and Produce Exchanges Volume 20 By Albert W. At wood, A.B., Associate in Journalism, Columbia University. Accounting Practice and Auditing Volume 21 By John Thomas Madden, B.C.S., C.P.A. (N.Y.), Professor of Accounting and Head of the Department of Accounting, New York University School of Com- merce. Financial and Business Statements Volume 22 By Leo Greendlinger, M.C.S., C.P.A. (N. Y.), Sec- retary and Treasurer, Alexander Hamilton Institute; formerly Assistant Professor of Accounting, New York University School of Commerce, Investments Volume 23 By Edward D. Jones, Ph.D., formerly Professor of Commerce and Industry, University of Michigan. Business and the Goveriiment Volume 24. By Jeremiah W. Jenks, Ph.D., LL.D., Research Pro- fessor of Government and Public Administration, New York University, Member of Advisory Council, Chair- man of the Board, Alexander Hamilton Institute, in collaboration with John Hays Hammond, consulting engineer and publicist. 2— Talks The Modern Business Talks, which are sent fortnightly, are informal discussions of the principles treated in the Text. As the name indicates, these Talks bring up many specific points and cases, and show more clearly why and 22 how the underlying principles of scientific business should be applied. They are particularly direct^ practical and stim- ulating. Their periodic visits serve to keep every subscriber in touch with the Institute Staff and alive to the importance of following the Course systematically. The Talks are pre- pared by members of the Institute Staff or other authorities. In the pamphlet which contains the Talk the reading assignment for the following two weeks is suggested. On receiving the fortnightly instalment of new material, the subscriber will ordinarily read the Talk before taking up the reading assignment, and thus get a bird's-eye view of the ground that is to be covered during the succeeding two weeks. Some of the subjects discussed are: The Shortest Way to the Executive's Chair The Market Value of Brains Sharing the Product Pitfalls of Partnership A Corporate Venture Putting the Message Across The Dominance of Salesmanship Leading the Sales Force Credit, the Motive Power of Business Cost Records as Profit Makers Overcoming Corporation Difficulties The Hundred Thousand Dollar Letter Making Advertising Pay The Railway a Public Servant Building Up Your Bank Credit Cashing in on Foreign Trade Safeguards of Insurance What Do You Know About Wall Street? The Benefits of Speculation Capitalizing the Auditor's Viewpoint Basing Decisions on Facts Reading Accounting Records Saving Salesmen Holding the Watch on Your Investment Satisfying Your Foreign Customer 23 3 — Lectures The written Modern Business Lectures, which are sent to subscribers monthly during the two-year Course, have been especially prepared for the Institute by eminent busi- ness executives, publicists and accountants, and reflect the experience of these men in successfully handling business problems. They are intended, first, to show how these men have actually applied the principles discussed in the Modern Business Course; second, to give further information as to large and highly developed business concerns and their methods; and, third, to bring subscribers into closer touch with the wide circle of representative, successful men of affairs. Some of the subjects of the Lectures are: Essentials of a Successful Enterprise The Value of Trade Associations Marketing a Nationally Advertised Product Retail Store Management The Creation of a Selling Organisation Efficient Credit Management Organizing an Accounting Department Cost and Efficiency Records Marketability of Securities Building a Mail Order Business Elements of Effective Advertising The Railway as a Business Developer Selling in Foreign Markets How Banks Serve Business The Foreign E a; change Field The Day's Work in Wall Street Why Business Needs the Auditor The Investment Security Business 4— Problems One of the strongest features of the Course is the series of twenty- four Problems — such problems as accountants, financiers, bankers and business managers meet in practice 24 — especially prepared for the Course by members of the Institute Staff. Each Problem is a carefully worded statement of all the essential factors in some business situation; in other words^ the situation is presented and described just as it might be in the report of a subordinate official to the head of a busi- ness enterprise. The Problems are so arranged as to cor- respond closely to the assigned reading. For instance, after the subject of cost accounts has been discussed, a Problem is given in which a knowledge of cost accounting principles is called for. Thus, the Problems serve not merely to test the subscriber's understanding and thinking power, but also to fix in his mind and make definite the statements and prin- ciples contained in the Text volumes. When solutions to the Problems are sent in, they are criticised, graded, and returned with suggestions for fur- ther study. Solutions to the Problems are not, however, required. Some of the titles are: The President's Choice Advertising the Ayer-Hall Saws Remodeling the Rowland- J ohnson Company's Sales Organization A Question of Profits and Financial Condition Three Foreign Exchange Situations Scudder's System to Beat the Market The Reorganisation of the Industrial Realty Com- pany Embarking in Foreign Trade A Fire and Its Consequences 5 — ^Monthly Letter on Business Conditions A business executive must have a knowledge of the funda- mental principles relating to the internal organization and management of a business. He should also have a basis of judging those external business conditions over which no one group of men has control, but to the trend of which every line of business 25 must be adjusted in order to gain the maximum of profit and suffer the minimum of loss. The results of these studies are presented to the business man in a clear and concise manner in the Monthly Letter on Business Conditions. In order to keep subscribers informed regarding the state of business at home and abroad, and as a basis for applying the principles explained in the Text, the Monthly Letters will prove most helpful. The economic experts of our Busi- ness Conditions Bureau are constantly bringing together and interpreting facts and figures regarding bank clearings, pig iron production, unfilled steel orders, exports and importi?, railroad earnings, and such indices of financial conditions as the reserves, loans and deposits of the Federal Reserve Banks. The letters discuss political events and developments in the business world which have an influence upon price movements and conditions of activity or depression. The business man will find them particularly interesting, as they show him what to expect in the future by pointing out the present trend of affairs. 6— Financial and Trade Reviews The Financial and Trade Reviews are issued monthly by our Bureau of Business Conditions and are designed to cover in a timely and interesting fashion the activities in the security market by analyzing individual and group securities and by presenting statistics on prices and earn- ings of standard stocks and bonds. The Reviews cover the production and price trends o£ basic commodities and matters of interest in foreign fields. Leading articles deal with current events of note and in- terest to the business community. The Financial and Trade Review is a valuable supple- ment to the principles brought out in the regular reading schedule. 7— Modern Business Reports The Modern Business Reports are written by profes- sional and trade experts and members of the Institute Staff, 26 and cover both important business problems of general in- terest and technical subjects relating to Accounting, Sales, Office Methods, Merchandising, Production and other spe- cialized departments. From time to time a descriptive list of these Reports is sent to each subscriber. From these lists the subscriber may choose four Reports at any time during the two-year period of his enrolment. These Reports run from ten to fifty pages in length. Each one is prepared in reference to some specific problem and is the result of special investigation. The subjects cover a wide field, and every subscriber will find among them a number which are of particular interest to him. The list of Reports includes such titles as : Preparation for the Accounting Profession Profit Sharing Territorial Supervision of Salesmen Advertising American Goods in Foreign Markets Analysis of Bank Reports Promotion and Organization of a Public Service Corporation The Psychology and Strategy of Collecting Desk Efficiency How to Read the Financial Page of a Newspaper Employes' Pension Systems Evaluation of Public Utilities. 8 — Service The reading matter of the Modern Business Course is in itself of remarkable value ; subscribers have told us over and over again that one volume, or sometimes one pamphlet, or one Report, has brought them ideas worth vastly more than the fee for the Course and Service. This value is largely enhanced by the fact that back of the reading matter there is an organization of men who are anxious to cooperate in every way possible with each subscriber. This organization is equipped to render service at every stage of the subscriber's progress. 27 First of all, certain members of the Staff are assigned to the pleasant task of carrying on correspondence with sub- scribers. They make an earnest effort whenever a new en- rolment is received to get into touch with the subscriber and learn under what conditions he is working, what experience and education he has had and what objects he has in view. With this information before them they can often make sug- gestions that are directly helpful and that mean a larger in- crease in the subscriber's personal benefit from his use of the Course and Service. Furthermore, every one who thinks as he reads comes across statements and opinions which he does not fully un- derstand or which he questions* The privilege of asking about any such statements or opinions is freely open to all subscribers. There is no limit whatever to the number of questions which may be submitted, based on the Text or other reading matter of the Course, The four great activities of business There are four fundamental activities in every business — Production, Marketing, Financing, and Accounting. On the following page you will see the whole fi^l^f business charted in such a way as to show clearly the relation of various business activities to each other. Economics, the study of business conditions and business policies, is the hub of all business activity. Radiating from it are the four grand divisions of business — Production, Mar- keting, Financing, Accoimting. These in turn are subdivided into the more detailed activities which they include. The Modern Business Course and Service is a thorough treatment of all the divisions indicated. 28 COPYRIGHT 1921, BY ALEXANDER HAMILTON INSTITUTE A Survey of Modern Business Science All business activities may be classified under Production, Marketings Financing and Accounting. For purposes of systematic study, each of these may be subdivided as shown above. In addition, there are two important forces which control business — Man and Government. For that reason a dis- cussion of the relation between ^'Business and the Man" and "Business and the Government" naturally forms a part of the survey of modern business. The first two and the last two assignments in the Modern Business Course and Service cover these important subjects. The arrangement of the subjects has been care- fully planned so that the maximum benefit will be derived by following the assignments in their regular order. In the chart you see the logical arrangement of these subjects as related to the business world. Note that the order in which these subjects are treated in the Course is not according to their arrangement in the chart. On the contrary, the more general subjects are first considered; then come the more complex — the specializations and enlargements upon the foun- dation subjects. This plan permits a progressive arrangement that makes for a broad understand- ing of the science of business. Just as any university or college requires a Ivnowledge of cei'tain subjects before others can be taken up, because this more general knowledge is essential to a proper understanding of the more advanced, so we have arranged the subjects treated in the Modern Business Course and Ser- vice in a similar manner. Texts, Talks, Lectures, Problems, Monthly Letters, Financial and Trade Reviews, Reports and Service — these are the important features of the Modern Business Course and Service. 29 Chapter II THE DANGER OF SPECIALIZING TOO EARLY A GREAT many young men think they have found a quick and easy road to success by concentrating their minds wholly on the jobs they happen to hold. It is perfectly true that a business man must not underestimate the importance of details. But it is also true that large success is al- ways built upon a clear understanding of basic principles. The common fallacy that it is best for a man — especially a young man — to confine his thought and studies to his own specialty has in many in- stances proved ruinous. It is easily possible to specialize so much as to lose all sense of the importance of a broad, well-balanced business training. We all loiow the lawyer who is wrapped up in his quibbles; the accountant who sees nothing in business but a maze of figures; the advertising man who is so fascinated by "cleverness" that he 30 forgets to try to sell goods; and the technical man who knows nothing about the commercial phases of his engineering problems. Such men cannot take their places among the higher executives because they laiow little or nothing of business outside their own specialty, and they cannot laiow even that thoroughly while their general outlook remains so narrow* Only half ready Some years ago two young men of unusual promise graduated from a prominent School of Mines and went to work for a big copper com- pany as full-fledged mining engineers. They were located at an isolated camp, remote from civilization, and were given every chance to make good the prediction made for them at the time of graduation. These men soon proved that they knew a great deal about the mining of copper. Their advance- ment was rapid, and within a comparatively short time one of them was appointed General Man- ager and the other Chief Engineer. To all in- tents and purposes they were in complete charge of the company's interests in that locality. It was not long before the problems put up to these two mining experts ceased to be con- fined to the technical end of the business. The 31 handling of a large number of men, the disposi- tion of big smiis of money, the necessity of using both men and money economically, the account- ing and statistics of their operations, and a hun- dred other problems no less ''practical" demanded the exercise of judgment on their part and a knowledge of business principles that neither their technical training nor their previous expe- rience had supplied. Unfortunately, these two — the General Man- ager and the Chief Engineer — had their heads turned by their rapid advancement. They did not recognize the fact that a thorough business training would have made them well-nigh fail- ure-proof, and they even expressed contempt for scientific study of such subjects as accounting, banking, organization, cost finding, selling and finance. In course of time the operations of the com- pany made necessary the extension of its mining facilities, involving the erection of a concentrator and smelter at an expenditure of a little over $2,000,000. These men were in charge of select- ing and arranging for the sites and erection of the plants. The work had gone forward to a considerable extent when one of the executive officers of the company from the East came to inspect the properties and the progress of the new work. He was so disappointed at the lack 32 of business judgment displayed in the selection of the sites, the drawing of contracts and other matters, that he dismissed the Chief Engineer on the spot, and curtailed the authority of the Gen- eral Manager. He stated that thereafter he would select men who had some business as well as technical training. These men missed success because they lacked certain essential tools with which to build it. Equipped with an elaborate professional kit gath- ered through years of painstaking study, they still lacked that knowledge of business principles which was necessary to enable them to turn their technical knowledge into results. Every one who holds, or expects ever to hold, a position of business responsibility should be familiar with the whole field of modern business. The reasons for this are apparent to any one who has to do with the handling of large problems. It is necessary always to take into account all the important factors in such problems. No mat- ter how ably a marketing or an accounting diffi- culty may be met, the solution is worse than use- less if it affects unfavorably any other phase of the business. A business executive cannot afford to make many serious mistakes. To guard against mis- takes, he must be fortified with an all-round 33 knowledge of business practice — not merely a partial or one-sided knowledge. The principles of Production, Marketing, Financing and Accounting are fundamental and apply to all lines of business. The man who says they do not apply because his business is "dif- ferent" is simply exposing his failure to get down to rock bottom in his thinking. Every business has its points of difference, just as every man has an individuality of his own. But we know that human nature, broadly speaking, is much the same in all. In a like sense all business moves along similar lines. It all consists of pro- ducing, marketing, financing and accounting. The broad principles of modern business sci- ence, therefore, govern all business. They are related to your problems, no matter how "differ- ent" your business may appear to be on the surface. 84 Chapter III PUSHING BEYOND THE HALF-WAY MARK THERE is always a danger of half-way suc- cess. A man may be at the head of an office, a department, a sales force, or a business, and yet be only a half-way success, if what he has so far accomplished be measured against his actual ca- pacity. Most men, in fact, possess native ability sufficient to carry them forward into bigger posi- tions than those they now occupy. But to ac- complish that result it is necessary to keep con- tinually moving ahead. Chief among the characteristics that carry men past the half-way mark on the road to success is eagerness to keep on learning more about busi- ness principles and business methods. The late Marshall Field said: "The man who puts ten thousand dollars addi- tional capital into an established business is pretty certain of increased returns ; and in the same way the man who puts additional capital into his brains — information, well directed thought and study of 35 possibilities — will as surely — yes, more surely — get increased returns. There is no capital and no increase of capital safer and surer than that." The ablest men in business are constant stu- dents. Many of the foremost business executives of the United States have for this reason wel- comed an opportunity to enrol for the Modern Business Course and Service. This Course and Service brings to them in convenient, time-saving form, an explanation of working principles that have proved successful in every line of business. The kind of men enrolled Presidents of big corporations are often en- rolled for the Modern Business Course and Ser- vice along with ambitious younger men in their employ. Among the 145,000 subscribers are such men as : H. S. Kimball, President of the Remington Arms Corporation John J. Arnold, President of the Bankers' Union of Foreign Com- merce and Finance E. R. Behrend, President of the Haramermill Paper Company H. C. Osborn, President, American Multigraph Sales Company- Melville W. Mix, President of the Dodge Manufacturing Company William H. Ingersoll, Marketing Manager of Robt. H. IngersoU and Brothers Charles E. Hires, President, Hires Root Beer Company P. W. Litchfield, Vice-President of the Goodyear Tire and Rubber Company Ezra Hershey, Treasurer, Hershey Chocolate Company William A. Candler, Secretary, Coca-Cola Company George M. Verity, President, American Rolling MUl Company Charles E. Murnan, Vice-President, United Drug Company W. F. MacGlashan, President, The Beaver Board Companies H. D. Carter, General Manager, Regal Shoe Company 36 Francis A. Countway, President of Lever Brothers Company (Manufacturers of Lux and Lifebuoy Soap) E. E. Amick, Vice-President, First National Bank of Kansas City Raymond W. Stevens, Vice-President, Illinois Life Insurance Company Roy W. Howard, Chairman of the Board of Directors, Scripps- McRae Newspapers Stephen B. Mambert, Vice-President, Thomas A. Edison Industries S. L. Avery, President, United States Gypsum Company — and scores of others equally prominent. These men, and thousands of other Institute subscribers, know that a study of the principles which have brought unusual success to other men increases their own capacity for further achieve- ment. Great business organizations Officers, department heads and juniors of a large number of important companies are en- rolled for the Modern Business Course and Ser- vice. The prime purpose of the Course and Ser- vice is to develop the business knowledge and judgment of each subscriber, and the heads of these companies realize that the increased effi- ciency on the part of individuals which results from this training carries with it greater effi- ciency and profits for their companies. The tendency in large business organizations, unless the chief executives are unusually thought- ful and far-sighted, is to repress initiative and constructive thinking except on the part of the few men who direct the affairs. The Modern 37 Business Course and Service counteracts this ten- dency. It encourages thought and initiative. It develops men. It stimulates the whole organiza- tion and makes possible more rapid expansion and larger earnings. Among the progressive concerns in which a number of men have been making effective use of the Modern Business Course and Service are: Men enrolled American Radiator Company 65 American Telephone and Telegraph Company 139 Anaconda Copper Mining Company 75 Armour and Company 184 Bank of Montreal 84 Barrett Company 68 Bethlehem Steel Company 200 Burroughs Adding Machine Company 199 Canadian Bank of Commerce 143 Commonwealth Edison Company of Chicago 106 Cutler-Hammer Manufacturing Company 75 E. I. duPont de Nemours and Company 529 Eastman Kodak Company 61 Empire Gas and Fuel Company 144 Equitable Life Assurance Society 114 Fairbanks-Morse and Company 68 Federal Reserve Bank of Dallas 61 Firestone Tire and Rubber Company 164 Fisk Rubber Company 107 Ford Motor Company 353 General Electric Company 669 General Motors Corporation 802 B. F. Goodrich Company 256 Goodyear Tire and Rubber Company 439 International Harvester Company 122 Johns-Manville, Inc 123 Jones and Loughlin Steel Company 55 National Biscuit Company 64 National Cash Register Company 207 National City Bank of Nevi^ York 210 Newport Mining Company 114 New York Central Railroad Company 107 New York Telephone Company 138 Otis Elevator Company 92 38 Men enrolled Pacific Commercial Company 106 Pacific Telephone and Telegraph Company 105 Packard Motor Car Company 153 Pennsylvania Railroad Company 228 Proctor and Gamble Company 75 Public Service Corporation of New Jersey 68 Remington Typewriter Company 96 Sears, Roebuck and Companj^ 84 Singer Manufacturing Company 58 Southern Pacific Railway Company 90 Standard Oil Company 954 The Steel Company of Canada 51 Stone and Webster Engineering Corporation 125 Studebaker Corporation 97 Swift and Company 127 Texas Company 221 Underwood Typewriter Company 77 United Fruit Company 78 United Shoe Machinery Company 95 United States Rubber Company 265 United States Steel Corporation 771 Western Electric Company 254 Western Union Telegraph Company 291 Westinghouse Electric and Manufacturing Company. 501 Willys-Overland Company 191 Winchester Repeating Arms Company. 211 F. W. Woolworth Company 81 Many of the men enrolled in these great com- panies are heads of their organizations; presi- dents and vice-presidents. Most of them are im- portant officials and department heads ; a few are men with smaller responsibilities. The somid business reason which underlies the favorable action of so many great corporations is well expressed by President George M. Ver- ity, of the American Rolling Mill Company, who says : "When I learned that some fifty of our men had ^ decided to take up the Modern Business Course 39 and Service, the stock of this company rose sev- eral points in my estimation." The following expressions regarding the value of the Course to men in big corporations are typical of many that we have received: "We have been familiar with your Course of instruction ever since it was first offered, and regard it as an excellent one for men engaged in the investment security business. A large number of our men are taking the Course, and we have recommended it to many of our associates." Spencer Thask & CoMPAinYy InvestTnent Bankers, New York City. "Realizing my lack of experience, I subscribed to your Course and found it of incalculable value. It gave me quickly the funda- mentals of accounting, of which I had known nothing. It gave me a broad elementary insight into modern marketing methods. The volume on credits was also helpful. The Course saved me many expensive blunders. "Briefly, for one starting in a business of his own I consider the Alexander Hamilton Institute Course practically indispensable. In addition to its indirect value, I have been able to put a definite worth on this Course, to myself and the firm, of many thousands of dollars." J. Roy Allen, Treasurer, Mint Products Company, Inc., Mfrs. of ''Life Savers/' "The good that our people have received from the Alexander Hamilton Institute Course has been phenomenal. It is not only the most instructive and valuable treatise on live subjects for men who are training for business careers, but it is the most concise, instructive and clearly presented form of education, to our minds, that has been presented for the benefit of executives." Charles E. Murnan, Vice-President, United Drug Company, Boston. "In my long business experience I have never subscribed to any- thing from which I have received greater value, in which I have taken greater interest, and from which I have received greater inspiration for my work. I do not believe anyone can take up the work without finding it not only ef^'ective, but of great value." Charles E. Hises, President, Hires Root Beer Company, Philadelphia. 40 "My appreciation of the Alexander Hamilton Institute Coui?se is based not only upon the broad scope of its appeal and the close co-ordination of the subjects treated, but also from the benefit that I have personally derived from following the Course." Stephen B. Mambert, Vice-President and Financial Director Thomas A. Edison Industries. "It seems to me that your Modern Business Course affords an opportunity for the study of practical business methods and the acquisition of business knowledge which will be valuable to any man ambitious to succeed in business." F. W. Hills, Comptroller, American Smelting and Refining Co., New York. "We had two building sites in view. When it came to a final decision I applied the principles which were laid down in the Course; it became clear at once that the first site — which had orig- inally seemed so attractive — was actually less desirable for our purposes. "Knowing the fundamental principles, it was a simple matter to analyze the various requirements of this business step by step; as a result of this analysis we have a site even more suitable than the one originally contemplated ; and we were able to buy it not merely on more favorable terms, but at an actual saving of more than $82,000." George H. 'Ror^t, President, Twentieth Century Storage Warehouse, Philadelphia. "My experience with the Alexander Hamilton Institute leaves me only with the regret that I did not make contact with it at an earlier time." Samuel G. McMeen, PrmcZcni, Columbus Railway and Light Company, Columbus. "I have been looking for something of this kind for some time past and am more than pleased that this should be brought to my attention. R. C. NoRBERG, General Sales Manager, Willard Storage Battery Company, Cleveland. "The exceedingly interesting manner in which the subjects are treated was an agreeable surprise to me. I became so absorbed in the reading that I am reluctant to lay it down when bed-time or meal-time arrives." V. J. Faeth, General Manager, Winterroth ^ Co,, Piano Merchants, New York City. The unqualified indorsements of these success- ful executives, and the fact that a large number 41 of men in almost every nationally known organ- ization are enrolled, prove conclusively that there is a great need for training in business funda- mentals. Wlierever the wheel of business turns — the need is great. It is a matter to be reck- oned with by every man and concern in business. 42 Chapter IV A PERSONAL PROBLEM HOW is it possible that the Modern Busi- ness Course and Service should be helpful alike to the grizzled executive and to the young man who has not yet made his mark in business ? Why is it that in a great many organizations our list of subscribers begins with the president, in- cludes practically all the officers and department heads, and ends with a selected group of men who as yet are in subordinate positions? The answer is simple. The main problem of every business man is the problem of developing himself. It makes no difference how great or how small a man's position may be, the only way to enlarge his influence and his income is first to enlarge himself. The greatest business men in the country are quickest to accept and apply this truth. It may sometimes appear as though a man be- comes a bigger business man by being promoted 43 into a bigger job. The truth is just the reverse. The big job naturally gravitates to the well- trained, capable man. If the job proves too large for the man, it doesn't take long for it to shrivel until it becomes a perfect fit. On the other hand, a man who really becomes bigger than his job simply grows out of it and into another; or he enlarges the job and its re- wards to fit his measure. Where do you belong? You are a member of one or the other of these two groups : (1) those who have ''arrived'' (2) those who are on their way toward suc- cess. There is, to be sure, a third group which un- fortunately constitutes an overwhelming major- ity, the group made up of purposeless drifters who have no special ambitions and usually little native ability. To this group the Institute has nothing to offer. They might refuse indignantly to sign a con- tract to work for the next ten years at the same salary they are now receiving. Yet the end of the ten-year period will find most of them in the same position, or only a trifle ahead. 44 u 08 XI .2 X3 a o u a cs a> u (£4 Of lU e> o z UJ < z g < «2 o PRESI ERAL o s z «» u o ^ 1 1 wo g •f-« 43 NSURANCB D INVEST- RTMENT3 Staff EDIT AND I NANCE AN] [ENT DEPA o C3 «S^ a O GO 1 " ^ 1 •^ CJ 4«» ^ ^ 0= s *>> .3 OLL OE O NTS $15. "S 2- 1 l_ i! O ^ -TS OMP IN CH ACC 8,000 § >> Sta CCOUN STATI DEPAR 09 u ^ ■1 < « cJ 0) •o ^ ^ a P w ««-i en who by 1 O 00 Z Q S5 "< W RESIDE ARGE OP KETINO to $16,00 DVERTISI NDENCE ATION D VICE P IN CH MAR $8,000 a St SALES A ORRE8PO ANSPORT 1 !3 o^ "g J O Tj^ ;c! r ^ > ** 1 1 p For there is only one power in the w(M*ld that can lift a man, and that is the power of added knowledge and training. For years the Alexander Hamilton Institute has specialized in one thing; it has only one Course ; its sole business is to take men who know one department of business, and by adding to their equipment a knowledge of the other funda- mentals shown on the chart on the preceding page, to fit them for higher positions. If you already have reached a business posi- tion of large responsibility, that surely does not mean that you have stopped growing. The boundless opportunities that are open to all are beckoning you on. No noteworthy business man attains his full development until he is well past middle age. In fact, the man of real power never appears to have reached his limit. Your real achievements are still ahead of you. As you look over the pages following, you will see that the brainiest executives in the country are using the Modern Business Course and Service as equip- ment for still bigger undertakings. If you are still trudging in the ranl^, or if you have advanced only part way toward your goal, you will be keenly interested in the com- ments of those who have found the Modern Busi- ness Course and Service an immense help in has- tening their progress. These men are rapidly 46 forging ahead. They are setting a faster and faster pace. Unless you are able to keep up with them, you must drift to the rear. Because the young men of this generation are getting a better training than has been available in previous generations, the standards of business ability have risen and will continue to rise. Yes- terday, a man of limited experience and training was often able to force his way into an executive position ; today, it is much more difficult to do so ; tomorrow, it will be impossible. The business leaders of a few short years from now will be the men who today are preparing themselves for the duties of leadership. Your gains You may ask: ''What can the Institute do for me?'' The answer to your question is outlined in the "Chart of the Modern Business Course and Ser- vice" which is printed on page 49. That Chart shows how the organized knowledge about busi- ness principles and business practice which has been collected and classified by the Alexander Hamilton Institute is transmitted to subscribers through the eight features of the Course and Service — Text, Talks, Lectures, Problems, 47 Monthly Letters, Financial and Trade Reviews, Reports, and Service. In what ways can a business man cash in on this knowledge? A great many direct and prac- tical benefits that naturally follow the use of the Modern Business Course and Service might be cited. Seven of the most important are shoun in the Chart on the following page. The most obvious and direct benefit consists in a Betteu Understanding of Sound Busi- ness Principles. TTie other benefits shown on the Chart are: Ability to plan effectively Increased confidence in handling big deals Ability to make quicker and more accurate decisions More leisure for recreation and construc- tive thought Increased ability to handle men Insurance against mistakes. The inevitable results of these gains in per- sonal power and efficiency are Larger Income AND A Greater Success in Business. JsTote on the following pages what subscribers 48 Chart of the Modem Business Course and Service ORGANIZED BUSINESS KNOWLEDGE Collected and classified by ALEXANDER HAMILTON INSTITUTE ORGANIZATION (Advisory Council, Staff and Special Lecturers) TraQsmitted to Subscribers thru This knowledge as^ilated by The Wide-Awake Business Man results in LARGER INCOME and GREATER SUCCESS IN BUSINESS ^ Vi \ , \% VV ^ ii Is 5" m i \¥ H 1 \ 49 for the Modern Business Course and Service have to say in that connection. Better understanding A man cannot go far in business unless he thinks. And he must not only think, but think straight. His conclusions must be based on sound principles. Unless a man is thinking along right lines, he will have little initiative, and his judgment will be poor. The necessitj^ for every live business man to understand the principles upon which modem business is based cannot be overstated. The Modern Business Course and Service gives that understanding. It illuminates points that were obscure and it answers many puzzling questions. It lights up the road ahead, so that the business man can see more clearly the path that he should take. Mr. Wm- H. Ingersoll, Marketing Manager for the famous Ingersoll watch, says that the Modern Business Course and Service "gives the first coherent presentation of the entire subject of business. It gives one a perspective and an appreciation of essentials, as well as much knowledge regarding right and wrong methods of procedure/' As a fair example of the manner in which the Modern Business Course and Service stimulates 50 thought and leads to progressive action, even in companies that already were well organized and highty successful, take the following note from Mr. Norman W. Wilson, Vice-President of the Hammermill Paper Company: "Every moment's time I have devoted to it has been well rewarded. I want yon to know what a high regard I have for the work you are doing and to know that I make it a point to encourage our people here to study your Course." Mr. J. H. Hansen, President of the J. H. Hansen Cadillac Company of Omaha, empha- sizes the practical information that the Modern Business Course and Service has brought to him: "When I located in Nebraska as a salesman for the Cadillac automobile, a representative of the Institute persuaded me that I might just as well try for the big prizes in business as for one of the mediocre ones. The decision to enrol in the Mod- ern Business Course and Service was a turning- point in my life. "I knew something about selling already. But now I began to see business as a whole, and the relation of each department to it. Advertising and costs; accounting and office organization; the control of men, and corporation finance — all these elements, which are necessary if a man is to suc- ceed in business for himself, came to me with the Institute's help. "When the opportunity arrived I was ready for it. We organized our company and the first year did more than a million dollar business. "In my judgment, the reason why so many men never get into business for themselves or fail after 51 they do get in, is because they are not prepared for their opportunity when it comes." Mr. H. C. Smith, President, AUith-Prouty Manufacturing Company, Chicago, states why the Modern Business Course and Service is help- ful without being revolutionary: "All men who have been successful must be credited with having good business principles. Your Course does not require changing these prin- ciples, but it will broaden one's own ideas and en- able him to get greater results." Increased confidence A great many men accomplish less than their abilities and energy entitle them to accomplish, simply because they do not feel sure of them- selves. The boldest man alive becomes uncertam and timid in the face of unfamiliar difficulties. The man who follows the Modern Business Course and Service becomes acquainted at close range with business difficulties as well as with tried methods of overcoming them ; he learns how to tackle such difficulties and goes forward with- out fear or misgivings. The series of Modern Business Problems which constitute an important feature of the Modern Business Course and Service is especially in- tended to cultivate familiarity with difficult busi- ness situations and thereby to create self-confi- 52 dence. They are problems of the kind which executives are constantly meeting. The man who can solve them successfully should have no difficulty when he meets similar problems that arise in his own work. A better and broader grasp of the principles and practices that underlie all business also sug- gests ways of widening the scope of one's busi- ness activity and gives the necessary confidence to go ahead and do it. Mr. John McBride, of McBride's Theatre Ticket Office, New York, wrote us after completing the Modern Business Course: "The average man can double his faith in him- self in a few months if he will master the funda- mentals of business through your training." Mr. W. H. Schmelzel, President of the W. H. Schmelzel Company, of St. Paul, Minnesota, wrote after he had followed the Course : "It is my personal opinion that every young business man of today depends a great deal on consultation or advice from a successful and ex- perienced adviser or friend on all matters of a business nature. **In the early days of my business experience I was confronted with the task of making de- cisions preparing myself for the problems I was to solve in the years to follow. Having been born and raised in a small town in a Western State^ I was content with advice and consultation of my acquaintances in matters pertaining to the thoughts I wished to carry out. 63 "I was, therefore, eager to obtain assistance from a corps of experts in their particular line, and after giving your Modern Business Course considerable scrutiny, and being informed on the class of men, that I felt confident of their suc- cess, and I realized that such a Course had merit, and one which I could afford to consult, advise with and build my future with ideas and methods you had so ably worked out." Quicker decisions Is the ability to decide things quickly an in- born faculty? No, it is largely a habit of mind which anyone may cultivate in himself. How- ever, we must bear in mind that it is necessary not only to decide quickly; there must be very few mistakes. This requires a mind that is trained to grasp a situation and to think accu- rately as well as rapidly. The secret of quick and accurate decision is knowledge of principles. If a man knows what principle applies in handling a given case, he has no difficvilty in making up his mind and deciding what to do. If the balance sheet of a given concern were laid before you and you were asked to decide at once (assuming that the figures were correct) whether to ship a $10,000 order of goods to that company, pos- sibly you would not know what to say. But if you were familiar with the definite principles of accounting and finance which would enable you 54 to analyze that balance sheet and make it yield a vivid picture of the financial condition of the concern, you would not hesitate a moment. You would reply instantly. What decision meant to this man A young man, whose name we are not at lib- erty to give, told us of a dramatic incident which illustrates the value that keen business men at- tach to preparedness and quick decisions Up to about a year ago this young man was head ac- countant for his company. The Board of Di- rectors had been in session about an hour one afternoon when a messenger came to his desk and told him that he was wanted in the board room. As he entered the room the president snapped at him, '* Would you advise us to issue a block of collateral trust bonds to finance a new ad- dition to our factory which will cost about $60,000?" *'No," said the accountant, "the company's credit is good enough for an issue of $60,000 one to three-year notes without security. If necessary, the new building could be mortgaged after construction, and, at the present rate, the business could pay off the whole loan in five years." A rapid-fire series of questions followed, cov- 65 ering the financial, advertising and sales policy of the firm, to each of which the accountant gave concentrated thought, quick decision and con- vincing reply. The president's final question was, "How would you like to become treasurer of this com- pany at $6,000 a year?" In the letter that told of this incident this subscriber said: "I don't know whether I owe most to you or to my friend in the Carnegie Steel Company who urged me to enrol for your Course and Service. I could have answered few if any of the questions asked me without the knowledge I gained from it. I found out later that the president knew all the time I was following your Course, and wanted to prove to the rest of the directors that I could intelligently consider and discuss business prob- lems." Mr. Charles C. Chase, in the Advertising De- partment of Brown Company, of Portland, Maine, brings out another method of securing help in deciding questions that are outside the scope of his previous experience. He says : "To the fellows who have asked me about the Course and what I believe it will do for them, I have said: "Through a subscription to the Course of the Alexander Hamilton Institute you not only ally yourself with a "Board of Directors'* whose com- bined business experience probably amounts to at least ^ve hundred successful years — a Board the 56 members of which have had specialized experience in every important phase of business — but who have been assembled for the very definite purpose of helping men." This method is equally valuable to the execu- tive, according to Mr. Lynn P. Talley, Deputy Governor of the Federal Reserve Bank of Dallas : * 'Whenever I am confronted with a problem relating to fundamental economic conditions of business practice or business policy, I find great comfort and satisfaction in taking down the vol- ume relating to the subject and always find eluci- dation of the problems that confront me." Mr. James P. Robertson, of Smith, Robertson and Company, Seattle, says : "As a general reading Course on business I can truthfully say it is high grade, and can recommend it to anyone interested in the study of business." Mr. A. E. Winger, President, American Lithographic Company, writes: "I think your Course is an excellent one and am particularly impressed with the underlying thought that I find throughout the entire Course — application of principles. It has been my ex- perience that sound judgment is the most essen- tial requisite of any executive, and that the judg- ment required in business today can best be formed by a thorough knowledge of business prin- ciples." 67 Mr. Saoiuel Cochrane, President, Cochrane Chemical Company, Jersey City, sums up the argument in this remark: "If I had enrolled with you a year or two ago, I should be better able to handle the problems put up to me every day." More leisure The secret of leisure is not to do less work, but to organize work so that a greater volume can be handled in less time. No active man wishes to cut down his productive efforts. A great many men, however, are so tied to their business tasks by detail and routine that they have little time or energy left for constructive thought. Frequentlj^ they do not get enough recreation and physical exercise to keep them in prime condition. As a result, they are frittering away the best years of their life in handling small details that never bring them anywhere. To a greater or lesser extent, this is true of all of us. How to escape from the time-wasting energy-absorbing routine and details is a vital question. Being "swamped with too much detail" is in reality a kind of business disease — and a very dangerous one. It is most likely to attack the officers of rapidly expanding concerns and en- 68 ergetic, ambitious men who are constantly tak- ing on new responsibilities. Unless one can shake off this disease, it will probably go on eating away more and more of his time and energy until he loses his grip on large affairs and to his chagrin, sees other men of smaller ability rising above him. It is as bad for a man to be "too busy" as for him to be not busy enough. As a matter of fact, it is unnecessary for any man to be so harassed with details — except as a temporary condition — that he cannot give a reasonable amount of time to recreation, read- ing and thought. The company burdened by the detail-type of executive is not getting what it pays for. His natural abilities are being di- verted to things that cheaper men could do equally well. He owes it to his company, as well as to himself, to reorganize his work. Cutting out the details It is necessarily true in all such cases that many of the over-busy man's duties recur day after day. They are of a semi-routine nature and could be made wholly routine by giving the proper instructions to some one else. In other w^ords, this is a problem of organization similar to that of organizing a factory, a store, or a 59 body of men. The principles that are discussed in the Modern Business Course and Service apply to an individual just as well as to a com- pany. A man can organize his desk very much on the same plan that he would organize a fac- tory. When he does so, he invariably finds that his efficiency is increased, his work is more pro- ductive, and he himself has more leisure. Accordingly, any business man who desires to forge ahead should reduce the details of his work to routine which can be carried on with- out special thought. The Modern Business Course and Service is a direct and invaluable aid to the man who feels himself tied down by details. Of course, we must consider in this connection the man who thinks that he is much busier than he really is. There are spare moments in every man's day. There is the half-hour before or after the evening meal ; the time spent in travel- ing to and from work; the one or two evenings a week that even the busiest man should spend at home. The measure of a man's chances of success may readily be taken by learning the manner in which he uses — or wastes — his spare time. No better use can be made of these odd moments than in reading the Modern Business Course. This reading is not tiring; it is recre- 60 ative and stimulating. It will enable any man to organize his work so as to increase his leisure for reading and study. It will help him to rise to a higher level where his thought and energy will be more productive. Many of the big business executives are in- vesting their spare moments in just this way. They realize the great results that are bound to follow. It is unquestionably true that the use of one's spare moments count heavily in de- termining how much will be accomplished a year or two hence. The following also give their opinion : For a good many years as a practising mining engineer, I gradually began to realize that there was something wrong with engineers in regard to their business success. Something that seemed to stand between the most brilliant of men and success in business. After a long study of men and conditions, I subscribed to your Course. From then on I began to take greater responsibilities and larger fees because of my added confidence and business knowledge. I truly feel that your course ferried me across to that phase of professional grasp where I became successful in busi- ness as a professional engineer." GLENVILLE A. COLLINS, Consulting Engineer of Seattle. Much the same thoughts are admirably ex- pressed by another busy executive, Mr. J. H. 61 Carter, Vice-President, National City Bank of New York: "You will no doubt be interested to know that the class formed under the auspices of the City Bank Club to follow the Alexander Hamilton In- stitute Course, which you helped start about two years ago last Spring, is just completing its study. "The majority of the original enrolment of fifty members have followed the Course regu- larly. It has held the interest of the men through- out and has proved unusually stimulating and in- teresting. "The official staff of the bank has given the class its hearty moral support, and, in addition, has offered to refund a part of the fee to those completing the Course successfully. We feel that this policy has not only encouraged the men, but has benefited the bank as well. "Personally, I cannot speak too highly of the Course. I feel that the time I have given to it during the past few years could not have been employed to greater advantage." Increased ability to handle men There are just two factors that determine a man's competence to direct the work of other men: 1. His superior knowledge of the work in hand. 2. His abihty to command respect As a matter of fact, the second factor is al- most wholly included in the first. The man who really knows what he is talking about always cormnands respect. The man who is largely a 62 "bluff," no matter how "magnetic" or forceful his personality, is soon found out and retired in favor of the man of smaller pretensions, but more knowledge. The history of almost any business success demonstrates the truth of this statement. Modem business affairs are so complex that it is wholly out of the question to put an un- trained man in command. One might as well talk of putting an untrained man in charge of a modern battleship. In both positions broad- gauge knowledge and judgment are absolutely essential. ' The same principle applies equally to the minor commands. The leading business men of the country are for the most part quiet, self -controlled men, who think before they speak and who are constantly studying business prob- lems. This is the type of man best fitted to control and direct the work of others. The man w^ho develops himself, develops his ability to handle men. Through the Modern Business Course and Service the training can be secured that makes for self-development and for success. T. H. Bailey Whipple, of the Publicity De- partment of the Westinghouse Electric Com- pany, writes : **Your Course unquestionably does for men what experience and native ability alone can never do.'* 63 Mr. G. E. Lucas, Office Efficiency Engineer, Sayles Finishing Plants, saj^s : **I am indeed glad that I took the opportunity to enrol for the Modern Business Course and Ser- vice. What I have obtained has been of very ma- terial benefit to me. My own experience bears on the experience of my other colleagues who have been getting help and information from you in the past two years. All the reports that we have ob- tained have been thoroughly satisfactory and very complete." The experience of Mr. S. G, MoMeen, Presi- dent, Columbus Railway Power and Light Company, Columbus, Ohio, is equally to the point : "My experience began many years ago in technical lines and continued along them to en- gineering and construction practice. As often happens, this technical work led me into execu- tive matters. It was in them that I missed some of the advantages enjoyed by men who have spe- cialized earlier in commercial and financial work. '^Naturally I formed a habit of appropriating the needed knowledge wherever I might find it, and found much more than I could assimilate. The long-felt need, therefore, was for a source of classified information for reference and study, a source of training by the use of intelligent problems and a source of advice to which I might turn when in doubt. This source I found in the volumes, periodical literature and service of the Alexander Hamilton Institute." 64 Larger income and success As the diagram on page 49 indicates, the seven direct aids which subscribers obtain from the Modern Business Course and Service are: 1. Better understanding of business principles 2. Ability to plan more effectively 3. Increased confidence in handling big problems 4. Quicker and more accurate decisions 5. More time for constructive thinking 6. Greater ability to handle men 7. Knowledge that prevents mistakes All of these aids to personal efficiency are bound to result in increased income and greater success. Even though a man should gain only slightly in any one of the seven qualities named, he would become a far better business man. He would either advance in position or expand his business — in either case raising himself to a higher level of income and success. The effect is ail the more striking when a man in- creases his efficiency in respect to all seven qual- ities. To cite examples seems almost unneces- sary. Yet a few typical expressions from subscribers may be of interest : "It is very hard to put into words just how much good I have derived from the Alexander Hamilton Institute Course, but I do realize that as problems present themselves, thej'' are much easier to solve, and I have a better conception of the future outlook of business since having the benefit of your Course, and there is scarcely a day but what some matter comes up for which I use your Course." Mr. W. C. ROOSE, 8e&y and Gen. Mgr. Beacon Shoe Company, Manchester, New Hampshire 65 "During the past two years my salary has increased more than 400%. This has been due to the rather remarkable increase the Fuller Brush Company has had in sales. These sales are indi- rectly the result of the ideas I have received from your Course.** S. L. METCALF, J Former Vice-President and Director of Sales, Fuller Brushes, Jnc, Now President, Better Brushes, Inc., Palmer, Mass. "To the man who has had the advantage of a college education this Course opens up what might be called a vista of the business world in a very unique manner. The information obtained from this course, if acquired by the ordinary college man by actual experience, would require no less than a lifetime and it is pre- sented in such a manner as to be readily assimilated in the short space of two years, devoting only odd hours to study." Mr. E. J. BARTELLS, Manager Wood Pipe Export Company, Seattle, Washington A subscriber from a prosperous city in Iowa recently called at the New York offices of the Alexander Hamilton Institute, saying that he wanted to meet some of the men who had given him such valuable assistance. He is the controller of a large manufacturing company and a thoroughly trained and expert account- ant. The thing that impressed him most about the plan of the Modern Business Course and Service was the opportunity it offered him of increasing his already extensive knowledge of the principles of finance, management, adver- tising, selling and organization, as well as ac- counting. "Let me tell you what happened to me a few weeks ago," he said. "I found myself up against a problem that never had arisen in my 66 previous experience. I was simply stumped. I sought help from various sources in attempt- ing to find a satisfactory solution. Then it occurred to me — the most obvious things often come to mind last^ — to look in the Modern Busi- ness texts for a ray of light. To my great de- light, there I found a clear and definite state- ment of the very principles that should be applied. i ***! am frank to say to you/' he concluded, *'that this one bit of information was worth to me at least three times the price of your Course." Already this subscriber had realized a 300 per cent dividend on his investment. Of his sub- sequent gains we have no record. To the great majority of those who subscribe for the Course and Service the returns are simply incalculable. The training, the information and the ideas that they secure are a big — often an essential — fac- tor in making their business careers happier and more successful. Who can calculate the money value of a return of that kind? The moderate fee which is charged for the Modern Business Course and Service is based directly upon the cost of producing the litera- ture included in the Course and of maintaining the organization that conducts the Course and Service. The fee is small in itscK; it shrinks into insignificance when compared with the re- 67 turns. One of our subscribers was speaking only the literal truth when he said : "To the man of ability and brains^ your Course and Service offers a priceless means of develop- ing these qualities to their highest efficiency/' For the woman in business The Modern Business Course and Service makes the same appeal to the business woman as it does to the business man. Consequently a number of women are enrolled for it. Among these women are : Mrs. E. M. Simon, President, R. & H. Simon Company, Union Hill, New Jersey Miss Sara F. Jones, Mgr. Woman's Dept., Equitable Life Assur- ance Society, Chicago, Illinois Mrs. M. K. Alexander, Solicitor, Equitable Life Assurance Society, Chicago, Illinois Miss Mary R. Cass, Manager, F. N. Burt Company, Buffalo, New York Miss Louise Messner, Accountant, Petermann Stores Company, Kearsarge, Michigan Miss S. F. Troutman, Secretary and Assistant to Treasurer, First Presbyterian Church, Pittsburgh, Pennsylvania Mrs. N. M. Favor, Assistant Cashier, The Travelers Insurance Company, Manchester, New Hampshire Today women are engaged in all branches of business. A great number of women occupy ex- ecutive and other important positions in some of the large concerns of the country, and the number is steadily increasing. For the ambi- tious woman a career in business, with its great rewards and the possibilities of rendering worthy service, holds forth attractive opportunities. 68 Chapter V THE QUESTION BEFORE YOU A SERIOUS business question is now con- fronting you. It is important that you should consider it fairly and calmly and that you should promptly make up your mind for or against it. The facts are all before you. The question is whether or not you should enrol for the Modern Business Course and Serv- ice. Think over the arguments pro and con. You know that the Course and Service will bring you a better understanding of sound busi- ness principles; that it will give you increased self-confidence; ability to plan more effectively and to decide business questions more quickly and surely. You will find yourself with in- creased ability to handle men. You will prob- ably enjoy more leisure; you will certainly earn a larger income. You are well enough acquainted with the standing and reputation of the men behind the Alexander Hamilton Institute to know that the Modern Business Course and Service must 69 be of the highest quality. And for the same reason you know that it naturally is offered to you at a very moderate fee. The fee for the Modern Business Course and Service is $136 in the United States. This covers, without any additional expense, the Texts, Talks, Lectures, Problems Monthly Let- ters, Financial and Trade Reviews, Reports and all necessary personal help. The complete set of 24 Text volumes comes at once, and the other literature at convenient intervals. If the Course is worth anything at all, the fee is slight in comparison with the results that will follow. The fee may be paid in convenient terms. Make your decision Certain objections may occur to you: . .You have other uses for your money — No doubt; yet none of them is as necessary to your successful business career as the Modern Business Course and Service. You are too busy — Everybody who amounts to anything is busy ; yet never "too busy" to acquire knowledge so important as this. 70 You have a debt to pay o^, or a trip to take, or you would rather "think it over — '' These arguments are unsound from every point of view. No man, in justice to himself, or to those who may be dependent upon him, should deny himself this opportunity to make an investment that will yield large dividends one, two and three years from today. In the coming struggle for world markets, there will be a great need for men of broad, executive training. For men who are prepared, there will be more opportunities to succeed ia a big way than ever before. It is false economy, therefore, to postpone for a single day a decision that will enable you to push beyond the half-way mark and forge ahead in business. You are a business man, trained to make de- cisions. The simple facts are before you now. Weigh the arguments ; then act. 71 Chapter VI DESCRIPTIVE OUTLINE OF THE COURSE IN looking over the following detailed outline of the Modern Business Course, you will see more clearly how closely every section is related to daily business practice. The italics after each title give the actual chap- ter headings; the following matter gives a brief discussion of the purpose and scope of each sec- tion of the Course. 72 Business and the Man %ciency Personal e^ Health The efficient business man The executive Subordinate or junior officers The rank-and-file worker Personality Character Analysis Opportunity "Scientific Training for Bvm- ness," an introduction to the Modem Business Course and Service Nature and aim of business The profit problem Economics and sociology Psychology Ethics of business Vision, or the idea The most important thing in business is the human ele- ment — you. Every man must have real ambition, high ideals, and a definite goal in mind before even a correct knowledge of business principles will help him to more than a half-way success. The purpose of this first section of the Course is to dis- cuss the viewpoint of the successful business man in an inspiring way, so that you may be inspired yourself and so that you may be able to inspire others about you. "Scientific training for business" is an introduction to the whole Modern Business Course and Service. In it Dean Johnson tells you in what way you should read the Course, how to get the most out of it, and how to use the equipment so as to bring results. The Course begins with an analysis of business opera- tions. It shows briefly what are the dominant features of business life which no man can afford to neglect. It then takes up the relation of personal qualities to business suc- cess; it shows what personal characteristics are helpful and how they may be cultivated; and it also points out the traits of mind, manners and morals which hinder men in their business career. The first point in understanding business problems and business principles is to approach them with the right attitude of mind. This section of the Course serves to bring the reader into personal touch with the business problems which will engage his attention more in detail in the subsequent sec- tions and thus furnishes a useful introduction to the en- tire Course. 73 Economics — the Science of Business Money Credit Money y credit and prices Foreign trade Rent Interest Wages Profits Purpose and scope of economics Fundamental concepts Land and capital Labor and enterprise Three fwndamental laws Consumption of wealth Value and the consumer Value and the producer Value and the trader Economics is the foundation stone upon which the sci- ence of business is built. It underlies all business just as mathematics underlies all branches of engineering. It is the basic subject of the Course, and its general principles should be thoroughly understood before taking up the sub- jects treated later. The book is written for the general reader, who has little or no knowledge of economic theory. It gives a clear idea of the business problems and forces with which business men deal and enables the reader to form intelligent judg- ments of his own. This section of the Modern Business Course makes clear the laws governing the prices of goods, the wages of em- ployes, the profits of employers, the processes of exchange, the functions of money and credit, and the rent of build- ings and land. It takes up in comprehensive manner the problems raised by trade unions, by trusts, by govern- mental taxation and by the growing tendency toward gov- ernmental regulation of business. An understanding of all these live, interesting business problems is an essential part of the mental equipment of a broad-gauged business man, working imder present-day conditions. 74 Business Organization Purposes and forms of business organizations Sole proprietorship General partnerships Limited partnerships Syndicates Business trusts Corporations as business units General aspects of corporations Incorporation of companies Dissolution of corporations Stock and dividends Stockholders Meetings of stockholders Directors and officers Intercorporate relations Consolidations J sales and leases of assets Holding companies Illegal combinations If you are in business for yourself, or in some way be- come interested in a growing business^ there is nothing that is of greater interest than your rights and the rights of other men who are in the concern. The application of the correct principles of production^ marketings financing and accounting are necessary to in- sure success, as they determine the profits of the business as a whole. Every man goes into business to secure more income for himself, and the amount of his own income will depend, not only on the amount of the profits of the whole business, but on his own proportionate share of these profits. The division of the profits into shares depend almost entirely on the form of organization. Moreover, when men enter business they hazard not only their time and a definite amount of wealth in the enterprise, but perhaps other wealth that was intended to be kept separate. Indeed, embarking on a business venture may be but the beginning of the loss of the income of future years when all chance of profits has ceased and the business represents nothing but a lot of debts that remain to be liquidated. Risk is an important element that is varied by the form of organization selected. This section traces briefly the rise of the corporation through the individual enterprise, the partnership and the joint stock company, and states the advantages and disadvantages of each of these forms of conducting business, as well as those of the corporation. This section of the Course constitutes the first step in tlie study of corporate finance. 75 Plant Management The basis of modern industry Fundamental industrial 'princi- ples Characteristics of modern in- dustry Methods of organization and a dministra tion Coordinative influences Purchasing Storing material Planning and production de- partments Insuring results — securing in- dustrial data Standards The control of quality — inspec- tion Rewarding labor — older meth- ods Rewarding labor — new ^methods Comparison of wage systems — profit sharing Statistical records and reports Location of industrial plants Arrangement of industrial Practical limitations in apply- ing industrial principles Problems of employment Employes' service Science and management Modern management of industrial plants is characterized by planning and system. Old processes and old methods no longer command respect because they are old. They have been subjected to searching analysis in the hope of finding better ways of doing things. We look today not for the history, but for the reasons of every phase of plant management. This is our aspect of the general industrial changes which have transformed modern industry and made it a high-powered productive instrument. It is not an isolated thing, but just as significant a part of modern business methods as are improved transportation, increased credit and present-day banking. In this part of the Course, the relation of plant manage- ment to the characteristic development of modern life ii &st traced, and then the changes displayed which scientific methods have made in the conduct of manufacturing pro- cesses. These affect the structural organization of business, the relations of the directing and managing organs to one another. They also affect the operations of these man- aging units, the purchase and storage of materials, the routing and sequence of work, the best utilization of ma- chinery and the like. The keynote of the volume is efficiency in productive effort and the principles which underlie it. 76 Merchandising Reaching the market and the complete campaign Merchandising: The jobber Modification of the jobber's service Problems of the jobber Retail competition Retail types Chain stores Mail-order selling Training the sales force Buying Stockkeeping Cooperation for service Marketing and Marketing : Modern distribu- tion The field of marketing Study of the product Study of the market Trade channels Selling to the jobber Wholesale middlemen Selling to the retailer Selling through exclusive agencies Influencing retail sales Selling to the consumer Good-will and price mainte^ nance There are three different kinds of things that must be considered by everyone who has anything to sell. One group of considerations has to do only with personal sales- manship and sales management. Another has to do only with advertising. Still a third is concerned solely neither with personal salesmanship nor with advertising, but is common to both. Before an effective force of salesmen can be selected and trained and an advertising campaign mapped out, the plan behind the personal selling and ad- vertising campaign must be devised — the marketing meth- ods must be determined. The considerations here may be grouped under three heads: the goods to be sold, the market for the goods, and the methods of reaching that market. A number of questions must be asked and answered about the things to be sold. For example: Is there a ready de- mand or must one be created? Is the commodity a neces- sity or a luxury? Is it subject to seasonal variations? Is the trade-mark well known? And so on. The first part of the Text, Marketing, concerns the prob- lems of the manufacturer; the second part, Merchandising, treats of the problems of the dealer, both wholesaler and retailer. Between them they present a complete picture of the processes by which goods reach the consumer^ and reveal the tendencies in modern distribution. 77 Salesmanship and Sales Management Sales management: The sales manager — his qualifications and duties Building an organization — se- lecting men Building an organization — training salesmen Selling methods and the selling equipment Com,pensation and territory Sales records Cooperation with salesmen Sales contests Sales conventions Salesmanship: The power of personal salesmanship Staples, branded staples and specialties Selling process — preliminary to the interview Selling process — the interview Selling process — the agreement Selling process — miscellaneous Human appeals that sell Development of character and caliber The salesman's duties and re- sponsibilities Cooperation, influence and friendship There is no subject which is more universally interesting to everyone in business than selling. Salesmanship in its broadest sense is essentially the selling of one's point of view, the ability to start with the other fellow's point of view and lead his mind to accept yours. When an individual endeavors to influence another, he is practising salesmanship. In this broad sense, every- one will profit by a knowledge of the principles of sales- manship and selling methods. In this portion of the Modern Business Course, the sales- man is shown the necessity of learning something of his prospect previous to the interview. Suggestions are also made for getting to see the buyer. The developments in a sale are discussed in such a way as to enable the sales- man to build an effective, man-to-man transaction, and the human appeals that sell are outlined. After discussing the qualifications and duties of the sales manager, methods to be employed in the selecting, training and handling of men are detailed. The training of retail sales people is discussed. The planning of the salesman's equipment, the building of a sales manual, the apportion- ment of territory are gone into. Methods of keeping sales records and statistics are outlined; directions given for the handling of sales contests and conventions, the editing of a house organ, and the apportioning of quotas. Advertising Principles - a constructive force in business Fundamentals of advertising Getting the advertisement seen Getting the advertisement read Making the advertisement un- derstood Making the advertisement pro- duce action Human appeals in advertising Word values in advertising '^Getting the order" copy ^'Getting the inquiry*' copy ^'Directing the reader" copy '' Molding public opinion" copy Preparing the advertisement Layout of advertisements Booklets, catalogs and folders Dramings and reproductions Printing art in advertising Trade-marks, slogans and catch phrases Legal limits and restrictions on advertising Considering the large number of progressive concerns [ entering the field of advertising each year^ and profiting thereby^ the average business man's lack of knowledge con- cerning advertising principles is lamentable. Few have any ability either to write or to judge copy, and almost all are at a loss to deal intelligently with the printer. This section of the Course discusses the various classes of copy divided according to the results each is designed to accomplish. The value of word tone in writing and how to secure it are indicated. Instructions for preparing and laying out the advertisement are given. The technique of the printing art — type faces, paper, printing processes, half-tones and line-cut illustrations — is discussed. The advertising slogan, the package design and the vari- ous considerations in connection with the trade-mark are treated. The business man is prepared to correlate the principles of advertising with those of marketing methods, and to bring an understanding of both to his study of advertising problems of wholesale and retail merchandising. 79 Office Administration The office in modem business Location, 'planning and layout of the office Office equipment and supplies Office appliances Selection of employes Employment tests and records Training Stimulation of employes Filing Interdepartmental cammunica- tions Office manuals The worker's compensation Welfare Office organization Planning Office control Work reports and their use The art of management It is only in recent years that individual business enter- prises outside of the manufacturing field have grown to such importance as to bring a large number of employes under one management. Today the problems of the office are no less urgent than those of the shop. Office administration is in some respects like, in other re- spects unlike, plant management. It is alike in that it pursues the same ideals of efficiency. It is unlike in that machines and equipment fall into the background and the human element looms large in the foreground of ofiSice work. Methods of conducting clerical work have, since the ad- vent of the various office machines, of which the typewriter was the pioneer, undergone rapid transformation. Under- lying these changes there have been principles, more or less clearly recognized, which it is the aim of the Text to discover and present in an orderly and systematic fashion. In few departments of office work have standardized processes based upon scientific principles made such head- way as in the employment field. Hiring employes for office work, training them for their duties, stimulating them to their best effort, adjusting wages to work performed, and providing for deserved promotions, are no longer casual occupations of some general offices, but the work and special concern of the trained office manager. Here, as elsewhere, concentration and specialization are beginning to reveal the principles underlying successful effort. Such principles concern not only the operations, but the organization of the office and its various parts. 80 Accounting Principles Development and scope of ac- countancy Accounts and their purpose Classification of accounts Double entry bookkeeping Books of account Applying accounting principles — the original entries Applying accounting principles — the ledger records Applying accounting principles — summarizing results Columnar books I , Opening, operating and closing the books The trial balance Economic summary The balance sheet Single entry bookkeeping Continental system of book- keeping Depreciation Methods of cornputing depre- ciation Labor-saxiing devices Internal checks As business becomes more complex we are more and more dependent upon accounting methods ito show us the trend of the individual business in which we are interested. Hence a knowledge of accounting principles is indispen- sable. Yet, even among experienced bookkeepers, compara- tively few have a clear understanding of the principles which underlie all correct methods of keeping financial records. This section of the Course, therefore, starts with a clear explanation of the fundamental principles of bookkeeping, and progresses step by step until it reaches the most com- plicated cases of partnership and corporation accounting. Within recent years the great importance of proper ac- counting methods in the conduct of business has come to be fully recognized. This section of the Course should enable any executive or accountant to determine what accounting methods are best adapted to his own line of business. 81 Credit and Collections Mercantile credit KOredit management Book credit ^^'^hiyuecYing the money due Documentary credit Granting credit — personal con- siderations Granting credit — business con- siderations Sources of credit information Cooperative methods in credit investigation Analysis of credit information The credit man The collection manager and his^ work Principles underlying collection effort Collecting on a friendly basis Unfriendly stages of collection^ Credit protection Bankruptcy The role of the credit depart- ment in developing business When a bill of goods is sold, the transaction is by no means complete — that is, if the sale is on credit. The pur- chaser must pay the bill. But some purchasers cannot pay,, others will not; therefore caution must be exercised in granting credit, and pressure brought to bear in obtaining payment. Often seekers after credit are foolishly offended at the questions they must answer. They do not realize how per- sonal is the favor they are asking, nor do they usually understand the combination of factors which the credit man must consider. These factors range all the way from personal habits of the applicant to a survey of general business conditions. There is a well-organized machinery for gathering credit information both in this country and abroad. This machin- ery, however, should be supplemented by the personal ob- servation of the salesmen, many of whom now fail to co- operate in the right spirit with the credit manager. The credit operation is incomplete till the goods are paid for; collections are the complement of credit granting, and they receive an extended treatment in the Text. As a last resource, the law may be resorted to, as is evident in the treatment of credit protection and bankruptcy. • The possibilities of the credit department as an agency in building up business, which have not always been under-- stood, are set forth in the concluding chapter. 82 Business Correspondence Letters that ^et action Seeing through the reader's The spirit of the letter The proposition In the letter The proposition analyzed fundamentals of the presenta- tion The aid of formula in presenta- tion Applying formulas to the pre- sentation Routine and individual letters Adjusting complaints by letter Credit letters Collection letters Working the mailing list Planning the letter Writing the letter Mechanical form Getting fhe most out of words Nearly all of us are constantly receiving and sending letters^ and we know in our experience the common types — the nasty letter^ the sloppy letter^ the cold-as-an-iceberg letter^ and^ on the other hand^ the direct yet cordial letter which makes us feel as if we had gripped a friendly hand. The profit-making influence of good correspondence can hardly be overestimated. A good sales letter may be the means of getting thou- sands of dollars' worth of business; a poor adjustment letter may be the cause of losing a worth-while customer. To a large extent business must be carried on by means of letters^ and there are few subjects of more vital impor- tance to the business man than business correspondence. Business letters always have a direct purpose in view and there are certain underlying principles which should be observed in all business letters^ whatever their particular purpose. But these letters serve many different purposes, and some of the prominent types and their characteristics are treated. Especial attention is given to sales correspondence, which forms a most important branch of business correspondence. 83 Cost Finding The importance of cost finding Problems of cost finding Identification of costs Issuing and evaluating vnaterial Evaluation of labor costs Expense or burden Depreciation Distribution of factory expense Production centers and the sup- plementary rate Effect of volume of work on expense distribution Other features of expense dis- tribution Distribution of administrative expense — resume Assembling and recording costs Analysis and reduction of costs Predetermination of costs — ma- terials and labor Predetermination of costs — ex- pense Application of cost finding methods Of late years, and as a direct result of growing compe- tition in all branches of industrial enterprise, the subject of cost is receiving increased attention. Every year sees hundreds of progressive concerns adopt- ing methods designed to ascertain the real cost of pro- ducing and selling goods and of managing a business en- terprise. Manufacturers are no longer satisfied with merely mak- ing a profit. They want to know what lines are paying and what lines are not — not in a general way, but specifi- cally in actual figures. They want to know which depart- ments are producing economically and w^hich are not. In this part of the Course, the various methods of keep- ing track of costs are described and illustrated. Particular attention is given to the mixed question of allotting general factory expense or burden. The possibilities of predicting costs are fully discussed and the significance of this development of cost finding methods is fully impressed upon the reader. The problem of costs is one of the widest application in business management and its significance in different lines of business is pointed out. 84 Advertising Campaigns The purpose of the campaign Analysis of demand and com- petition The advertising appropriation Methods of identification The advertising department The advertising agency Advertising media Weighing circulation Weighing prestige Letters and direct advertising Sampling How periodicals are used The use of signs Campaigns to obtain distribu- tion Campaigns to obtain dealer co- operation Mail-order campaigns Public sentiment campaigns The trader's campaign The campaign as a whole In the Modern Business Course and Service the study of advertising is divided into three parts. First, in Marketing Methods there is a complete presentation of the plan be- hind the campaign — of the things that have to be consid- ered by anyone who has anything to sell, before he sends out salesmen or prepares advertising. The section of Advertising Principles shows what ad- vertising can do for business, guides one in choosing the right advertising appeal, and treats of the technique of advertising, writing the copy, preparing the illustrations, and getting the advertisement before the public. There is much more to advertising, however, than the making of a preliminary study of the writing of adver- tisements. The advertiser has to consider problems of organiza- tion, methods of identifying his goods, his relation with agencies, the selection of media, distribution, dealer co- operation, and a host of other things, all of which have an important part in the complete campaign. This section deals with the many essential parts of an advertising campaign which have not been considered in preceding sections of the Modern Business Course. It gathers together all the diverse considerations of the ad- vertiser, shows their relation one to another, and binds them into a unified whole. 85 Corporation Finance Amortization of bonds Capitalization Investment and maintenance of capital Income, dividends and surplus ProTaoting the new enterprise Promoting consolidations Sellings stocks and bonds Financing the small company Financing reorganizations The corporation; a preliminary sketch Capital of the corporation Capital stock Stock not paid in cash Trade credit and bank loans Short-term loans Mortgage bonds Collateral trust bonds Bonds secured by leases Miscellaneous bonds and pre- ferred stock The advantages of the corporation have made it the most popular form of financial organization^ and nearly all busi- ness men are now interested in one way or another in the formation or management of corporations^ or in the buying and selling of the stock and securities of corporations. The stability of practically every business concern de- pends in a very large measure upon the keenness of judg- ment used in its financial management. This section of the Course enables one to think along financial lines with accuracy and decision. The methods by which corporations are promoted and financed are fully described^ and the principles that underlie successful cor- porate management are stated. The different kinds of bonds, such as mortgage bonds, collateral trust bonds, bonds secured by leases, etc., are explained and the methods of selling them discussed. There are sections on capital and its maintenance and a full discussion of income, dividends and surplus that will be of value to the executive and to the investor. In the last three chapters the application of the princi- ples of corporation finance to the small company is fully described. TliANSPORTATION Transcontinental rates and the Panama Canal Export and import rates Special services and charges Terminal services and charges in New York Express and parcel post The Transportation Act Inland water transportation The railroads and the shipping public The Government takes the rail- roads Government reorganization of railroads Railroad rates Classifications Rates in Official Classification and Southeastern Territory Business as it is conducted today would not be possible without the railroad. The corner grocery store as well as the big manufactur- ing company is directly affected by traffic^ rates and meth- ods. The prosperity of many a business and community is largely dependent upon relations with transportation companies. Yet many business men are unfamiliar with even the elements of rate making and traffic handling. The war made great changes in railroad organization and when the railroads were returned at the close of the war to their former owners a new set of problems had .to be faced. Rail rates had assumed a new importance, labor and other costs had increased and both shipper and carrier were called upon to consider transportation in an entirely different light than before the war. All of these problems receive careful consideration in this Text, and the tendencies of the times, so far as they have been clearly revealed, are pointed out. Classifications, rates, special services, terminal facilities and charges are some of the specific questions discussed. 87 Foreign Trade and Shipping Foreign trade: Relation of for- eign trade to domestic husi- The national aspect of foreign trade The market Governmental trade promotion Private trade promotion Indirect exporting Direct exporting The conditions of sale The export department Cooperation for foreign trade Making an export shipment Importing Shipping: Principles of ocean transportation The freight service Ports and terminals Ocean freight rates Rate agreements The merchant marine The events of recent years have turned the attention of business men of America once more to the problems of foreign trade. This section of the Course describes the development of our trade with foreign countries. It describes various changes which are at work in this field and the methods by which foreign trade is conducted. Intimately associated with this subject is that of ship- ping ; the transportation problems involved in foreign trade, questions of routes, rates, registry and the like are given particular attention. The advantages and disadvantages of American and foreign shipping and the problems involved in the up- building of an American merchant marine receive careful consideration. 88 Banking Classes of banks Operations of a co»mmercial bank The bank statement Loans and discounts Establishing bank credit Bank notes Deposits and checks The clearing house Bank organization and admin- istration Banks and the government American banking before the Civil War Banking in Europe Canadian banking system The National banking system Banking reform in the United States The Federal Reserve system State banks and trust com- panies Business concerns deal in bank credit every day. They have on deposit large amounts of their capital. They rely upon their banks' stability. And yet how few can read a bank statement with real insight and judgment. The fundamental principles underlying all banking oper- ations are presented under this heading. The nature of money and its relation to credit and capital are described, and the conditions which lead to a general rise or fall of prices are set forth. The important banking and monetary experiences of the United States are reviewed and full descriptions of the banking systems- of the United States, Canada, Eng- land, France and Germany are given. In connection with banking, the source of the banker's lending power and its relation to cash on hand are indi- cated, as well as the distinction between the bank note and the bank deposit, and the factors controlling the rate of discount. Banking practice is in large part a study of the bank- ing laws and customs prevalent in the United States, includ- ing those governing Federal Reserve Banks, State banks and trust companies. The subject is fully discussed in this part of the Course, as are also the technical aspects of banking in all details. 89 International Exc&ange Domestic exchange Federal Reserve Bank clearings General aspeets of foreign ex- change Basal factors of exchange Restoration prospects for rates of exchange Foreign remittances Bills of exchange A day in an exchange box Finance bills Arbitrage Rates of interest Gold shipments Sterling exchange Gold standard Gold exchange standard Silver and paper exchanges London and New York as fi- nancial centers War and the exchanges Tables The early part of this section of the Course deals with inland exchange and describes the method by which settle- ments are made between different parts of the same coun- try. When this is fully understood the problem of foreign exchange becomes very simple. It is the application of the same principles complicated only by the difference in money units between different countries. / The "Foreign Exchange" department of banking is of such great importance and presents so many difficult ques- tions that it deserves and is accorded special treatment. The reader is given a full description of the mechanism of the exchange market and is shown how money is made in foreign exchanges. He learns how the vast amount of export and import trade is made possible through the interrelations between the foreign exchange markets of New York, London, Paris and other large centers. He also learns concretely how foreign shipments are financed and is given some valuable information concerning the infhience of gold and other factors upon foreign exchange rates. An important feature of this section is a thorough discus- sion of the best methods of handling export shipments. Many American and Canadian manufacturers are consider- ing the advisability of going after foreign trade with greater vigor. They are usually puzzled when it comes to considering how to finance these shipments, which are often a long time in transit. The growing importance of export trade makes this section of the Course particularly valuable. 90 Insurance Risk and insurance The life risks Life insurance protection lAfe policies and premiums Modification of the ordinary life policy Annuities and pensions Group insurance Functions of insurance carriers — the old line companies Assessment and fraternal in- surance Government life insurance Accident and health insur- ance Liability insurance Workmen's compensation insur- ance — general features Workmen's compensation insur- ance — rate making Fire insurance Fire insurance policies Marine insurance Other forms of insurance Insurance constitutes a form of investment in which we are all interested, as purchasers of life insurance, fire in- surance, casualty insurance, marine insurance, or of any other of the various forms which have come into existence. To buy insurance properly, one should know the principles that underlie rates and insurance operations, and should be able to judge the policy which covers these various essen- tials. Partnership and business insurance is much more used now than it has been heretofore and it is becoming an important element in adding to the stability of business. Personal or life insurance occupies a large space in the Text. The nature of the life risk is discussed as well as the means of protection through the straight life policy. The various motives which have prompted these variations and the effect of these modifications upon the premium or the price of insurance are clearly explained. Various types of business organizations with divergent business methods have been devised for the purpose of conducting life in- surance. The strength and weakness of the different or- ganization forms are pointed out. Another aspect of personal insurance is found in accident and health insurance. Obligations toward others generally for personal injuries is the basis of liability and workmen's compensation insurance, of which the latter has had an almost mushroom development of late years. Property insurance brings up diverse questions in fire insurance and in marine insurance. 91 The Stock and Pboduce Exchanges The curb market Benefits and evils of specula- tion Influences that affect stock prices Produce exchanges and functions The future contract Organized spot ^market The Chicago Board of Trade their Functions of stock exchanges Leading stock exchanges The New York Stock Exchange Stock exchange securities Execution of orders, transfers and settlements Methods of trading The .speculative transaction Relations of banks to the se- curity market Quotations and news services Almost every man in business comes into contact with some one of the exchanges. Therefore, a detailed description of the organization, operation and management of the principal security and raw material markets of the world is of inestimable value. This is the aim of this section of the Modern Business Course and Service. Speculation in goods and in stocks exists because it per- forms an economic service. It saves the manufacturer of cotton goods or flour, for example, from gambling by an operation known as hedging. Business men should under- stand how speculation performs this service. The volume closes with a discussion of corners and of the influences governing security and produce prices. 92 Accounting Practice and Auditing Accounting Practice PTTO'prietary accounts Repairs, renewals, depreci- ation and fluctuation Partnership problems at organization Partnership problems dur- ing operation Partnership dissolution Partnership dissolution il- lustrated Consignments and joint ventures Fiduciary accounting Insolvency accounts Corporations Branch accounts Auditing The auditor and his work Scope of auditor's activity Procedure and methods Classes of audits Verification of the asset side of the balance sheet Verification of liabilities Reports and certificates This section deals with the application of the principles of accounting to the complicated problems that arise in practice. The correct method of treating the proprietary accounts under the different legal tj^pes of organization are considered. The management of surplus, the treat- ment of reserves, the relation between funds and reserves and the method of handling sinking funds are discussed at length. The differentiation between capital and revenue charges is perhaps the most difficult problem which the accountant has to face. The important principles involved in this problem are treated with numerous examples taken from actual cases. The difficult problems which arise in part- nership and corporate accounting are fully explained. Auditing is taken up from the business man's point of view rather than from the point of view of the practitioner. However, many points of interest to the practitioner and student are considered. The nature of the auditor's work is discussed and the different classes of engagements which auditors undertake are explained. The auditor renders a report on his work at the conclu- sion of his engagement and the form and contents of his report are treated at length. The subscriber is shown the difference in certificates which auditors attach to balance sheets and the proper method of interpreting them is discussed. 93 FiNANCIAI. AND BUSINESS STATEMENTS Importance of classified infor- mation Statistical and graphical state- ments Auxiliary statements Analysis and interpretation of income statements Consolidated income statements Valuation and interpretation of fixed assets Valuation and interpretation of intangible assets Valuation and interpretation of current assets Valuation and interpretation of deferred assets Treasury stock and its treat- m^ent Interpretation of liabilties Surplus, reserves and dividends Sinking funds and other funds Relation of working capital and income to assets Consolidated balance sheets Private budgets Municipal budgets Interpretation of professional reports The business man must understand accounting as far as he uses accounting knowledge in interpreting the progress of his business. He wants not so much the details of accounting tech- nique as the information necessary to enable him to use his accounting records properly. No one can expect to suc- ceed in a big way w^ithout the ability to read financial and business statements — ^both on the lines and between the lines. In every business the executive deals with a great variety of reports^ statements^ statistics and charts. This volume is designed to set forth the principles and to describe the methods by which they should be interpreted. In the discussion of private and public budgets is in- cluded data that will be of the utmost value to every busi- ness man. You will find a thorough discussion of budget making and a clear outline of what should and what should not be done. Instructions for the analysis of the reports and financial statements of industrial organizations and railway com- panies are set forth. 94 Investments Farm mortgages Urban real estate Public bonds of domestic origin Bonds of foreign origin Bonds and stock contrasted Bonds and stock classified Railway securities Analysis of railroad securities Public utility securities Industrial securities Mining securities Oil securities The cycle of trade Investment barometers The dream land of finance General rules Every successful business man at some time in his career has occasion to seek gilt-edge investments — either for his own surplus funds or for those of his company. The daily losses of investors' capital are evidence of the need for a volume which aims to qualify you to make the critical analysis of securities which is necessary to an in- telligent estimate of their value. Such topics as farm mortgages and urban real estate are thoroughly discussed and the opportunities in this new field for the investor are clearly explained. Domestic bonds, foreign bonds, securities of industrials, railways and public utility corporations are analyzed in a way to help you make an intelligent estimate of their value. In this volume you will find a thorough study of the subjects of security fluctuation and trade cycles, together with information on the general rules and technique of trading. 95 Business and the Go^ternment Public service corporations Local 'public utilities Trusts and combinations The postal service Should public management he extended? The great war: its effects, its influence, its lessons Business and the public in part- nership Taxation and business Oovernment, natural resources and the farmer Oovernment encouragement of industries and commerce Public inspection of business Problems of employment The Course opens with the personal relations of a man to a business and continues with an analysis of the various activities which constitute modern business. In this sec- tion it closes with the manifold relations of business to government. Business is^ as it were, in partnership with the govern- ment. In this partnership the government is active, as there are government departments aiming to promote busi- ness in manufactures and in trading. Business, of course, cannot exist without government, and as the war demonstrated, government cannot exist without business. Business is restive, however, under the close supervision wrought of war necessities. How far is such supervision justified in times of peace? This is a question both of principle and expediency and all its aspects are brought out in the discussion of specific problems, the tariff, trusts and corporations, public utilities^ national and local, and the like. 96 Chapter VII ADVISORY COUNCIL The Advisory Council has general supervision and direction of the policies and activities of the Institute, Joseph French Johnson, D.C.S., LL.D. Dean, New York University School of Commerce, Accounts and Finance Graduated Harvard University, 1878; studied political science and economics in Europe; began newspaper work on the Springfield Republican, 1881; moved to Chicago, 1883, and became financial editor of the Chicago Tribune; established the Spokane (Wash.) Spokesman, 1890, sold his interest, 1893, and became Professor of Finance in the University of Pennsylvania; appointed Professor of Po- litical Economy in New York University, 1901; Dean of the School of Commerce, Accounts and Finance since 1903; Secretary of the Special Currency Committee of the New York Chamber of Commerce in 1906; appointed by the National Monetary Commission to investigate and re- port on the Canadian banking sj^stem, 1909; Treasurer of the Economic Club of New York since 1908; Director of the Merchants' Association of New York since 1908; re- ceived degree of Doctor of Commercial Science from Union College, 1909; member. New York Chamber of Commerce; member of Mayor Gaynor's Commission on New Sources of Revenue for New York City, 1912; mem- ber of Van Tuyl Commission to Revise the Banking Law of State of New York, 1913; received degree of Doctor of Laws from Hobart College, 1915; author of "Money and Currency," and "Syllabus of Money and Banking," and author of the Modern Business Text on "Business and the Man" and "Economics — ^the Science of Business." Frank A. Vanderlip, A.M., LL.D. Financier Educated at the Universities of Illinois and of Chicago ; after his graduation reporter on the Chicago Tribune, and later financial editor ; also part owner and associate editor of the Chicago Economist; became private secretary to Secretary of the Treasury Gage, March, 1897; appointed Assistant Secretary of the Treasury, June, 1897; appointed 97 Vice-President of the National City Bank of New York, 1901; delegate to the International Conference of Com- merce and Industry held at Ostend, Belgium, 1902; served as President of the National City Bank of New York, 1909-1919; member, New York Chamber of Commerce; trustee, Carnegie Foundation; member of the Council of New York University? Director, Union Pacific Railroad Company, and of various industrial and banking corpora- tions; author of "Chicago Street Railways," "The Ameri- can Invasion of Europe" and "Business and Education"; Chairman, Board of Directors, American International Corporation. Jeremiah W. Jenks, Ph.D., LL.D. Research Professor of Government and Public Administration, New York University Graduated University of Michigan, 1878; admitted to the Michigan Bar; graduate student, receiving degree of Ph.D., University of Halle, 1885; Professor of Political Science, Knox College, 1886-1889; Professor of Political Economy, Indiana University, 1889-1891; Professor of Political Economy and Politics, Cornell University, 1891- 1912; Professor of Government and Director of the Divi- sion of Public Affairs, New York University, 1912-1918; President of the American Economic Association, 1906- 1908; expert agent of United States Industrial Commission engaged in the investigation of trusts and industrial com- binations in the United States and Europe, 1889-1901; expert adviser to the United States Department of Labor, 1901-1902; special commissioner of the United States War Department to investigate questions of currency, labor and taxation in the Orient, 1901-1902; special expert on currency reform for the Government of Mexico, 1903; member of the commission on International Exchange to advise government of China on Currency, 1903-1904; Di- rector of the Far Eastern Bureau, since 1913; member of the United States Immigration Commission, 1907-1910; member, High Commission of Nicaragua, since 1918; author of "The Trust Problem," "The Immigration Prob- lem," "Citizenship and the Schools," "Great Fortunes — the Winning, the Using," "The Principles of Politics," "Great American Issues" (written with John Hays Hammond), and of numerous government reports; and author of the Modern Business Text on "Business and the Government." T. Coleman duPont, D.C.S. Business Executive Educated at Urbana University, Chauncy Hall School and Massachusetts Institute of Technology; later Surveyor for the Louisville & Southern Exposition and Engineer for 98 the Central Coal & Iron Company; afterward engaged in extensive coal and iron mining, construction and manage- ment of public utilities; for thirteen years President of E. I. duPont de Nemours Powder Company; President, Central Coal & Iron Company; President, McHenry Coal Company; President, Johnson Coal Company; President, Main Jellico Mountain Coal Company; President, Johns- town Passenger Railway Company; Vice-President, Gree- ley Square Hotel Company; Director, Union National Bank of Wilmington; Director, Empire Trust Company; Director, National Surety Company; member. Republican National Committee; Chairman, Republican State Com- mittee of Delaware, 1904. Launched a comprehensive plan for remodeling Central City. Chairman of the Inter- Racial Council, Interested in one of the largest hotel companies in America, controlling Waldorf-Astoria, Cla- ridge, McAlpin, New Willard. New York University, D.C.S., 1919. John Hays Hammond, D.Sc, LL.D. Consulting Engineer Educated in public and private schools; graduated from Sheffield Scientific School (Yale), 1876; appointed by the United States Geological Survey in 1880 to examine Cali- fornia and Mexican gold fields; consulting engineer to Union Iron Works, San Francisco, and to Central and Southern Pacific Railroads; has made extensive examina- tions of properties in all parts of the world; became con- sulting engineer for Barnato Bros, in 1893 and later for Cecil Rhodes, with whom he was closely associated^ con- sulting engineer, Consolidated Gold Fields Co. of South Africa and the Randfontein Estates Gold Mining Co. ; was one of the four leaders in reform movement in the Trans- vaal, 1895-1896; after varied experience in London, he returned to the United States and became associated with some of the most important financial groups in this country, purchasing and promoting mining properties in this country and Mexico; lecturer at Columbia, Harvard, Yale and Johns Hopkins Universities; President of the National Republican League; President, American In- stitute of Mining Engineers; Fellow A.A.A.S.; member National Civic Federation, and other civic and political bodies; contributor to many scientific magazines; ap- pointed by President Taft as special ambassador and rep- resentative of the President at the Coronation of King George V; President of the World Court Congress. Hon- ary degrees: Yale, A.M., 1898; Stevens Institute of Technology, D.E., 1906; St. John's College, LL.D., 1907; University of Pittsburgh, D.Sc, 1915; collaborator on the Modern Business Text "Business and the Government." 99 STAFF The members of the Staff conduct the Modern Business Course and Service Bruce Barton General Publicity Graduated from Amherst College. Managing editor Home Herald, Chicago, 1907-1909; managing editor Housekeeper, 1910-1911; assistant sales manager P. F. Collier and Son, 1912-1914; editor Every Week, 1914-1917; publicity director United War Work Campaign; Presi- dent of Barton, Durstine and Osborne, Inc., advertising agents. Author of "More Power to You," "It's a Good Old World," "The Making of George Groton," and con- tributor to leading magazines and business papers. Dwight E. Beebe, B.L. Collections Graduate of the University of Wisconsin; for three years assistant to the Sales Manager of the Westing- House Nernst Uamp Company of Pittsburgh; for three years connected with the Publicity Department of AUis Chalmers Company, Milwaukee; later associated with Charles Austin Bates, New York City; appointed Bursar of the Alexander Hamilton Institute in 1911. Director of Service since October, 1918. Collaborator on the Modern Business Text on "Credit and Collections." Geoffrey S. Childs, B.C.S. Office Methods Educated at Bryn Athyn Academy; graduate of New York University School of Commerce, Accounts and Finance. Formerly with Trackless Trolley Company; and British and American Mortgage Company, New York City. Assistant Chief Clerk, Alexander Hamilton Institu- tute, 1914-1915. Office Manager of Alexander Hamilton Institute since June, 1915. Collaborator on the Modern Business Text on "Office Administration." Edwin J. Clapp, Ph.D. Transportation and Terminal Facilities Graduate of Yale University; after graduation spent one year teaching at Hill School, Pottstown, Pa.; two years as factory assistant and traveling salesman with the 100 Robin Hood Ammunition Company; Instructor in Politi- cal Economy, Yale University, 1911-1912; Assistant Pro- fessor of Trade and Transportation, School of Commerce, New York University, 1912-1914; Special Traffic Com- missioner to the Directors of the Port of Boston, 1914; Special Adviser to the Mayor and Harbor Commissioners of Troy; Professor of Economics, New York University and Lecturer on Transportation in the School of Com- merce, Accounts and Finance, New York University, 1914; Special Adviser to the Legal Department of the New York, New Haven and Hartford Railroad in its Sound Lines Cases; author of "The Navigable Rhine," "The Port of Hamburg," "Economic Aspects of the War," "The Port of Boston," the Modern Business Text on "Transportation." Raymond J. Comyns, B.C.S. Personal Salesmanship Educated at New York University School of Commerce, Accounts and Finance; connected with branch of the Equitable Life Assurance Society, 1900-1901 ; Accessionist, New York Botanical Gardens, 1902; entered Tenement House Department, New York City, 1903; Acting Chief Inspector of Tenements, Bronx Borough, New York City, 1907; Examiner of Charitable Institutions, New York City, 1909-1910; Lecturer on Salesmanship and Sales Manage- ment, New York University School of Commerce, Ac- counts and Finance; representative in Colorado of the Alexander Hamilton Institute, 1911-1913; appointed Staff Secretary in charge of Enrolments, 1913; Assistant Direc- tor of Sales since 1915; Co-author, Modern Business Text on "Salesmanship and Sales Management." Herbert F. deBower, LL.B. Advertising and Sales Policies Business Promotion Educated in the University of Wisconsin; practiced law for two years; engaged in selling specialties for a number of years; since 1911 Vice-President, Member of the Board of Directors and Chairman Executive Committee of the Alexander Hamilton Institute; also Director of various business corporations; author of the Modern Business Text on "Advertising Principles." Roland P. Falkner, Ph.D. Business Statistics Graduate of the Wharton School of Finance, University of Pennsylvania; graduate student at the University of Paris, Berlin, Leipsic and Halle; 1891-1900, Associate Pro- * fessor of Statistics, University of Pennsylvania; 1891-1892, Statistician, U. S. Senate Committee on Finance; 1892- 1893, Secretary, International Monetary Conference; 1900, 101 Chief, Division of Documents, Library of Congress; 1903, Special Agent, Bureau of Census on Statistics of Crime; 1904, Commissioner of Education for Porto Rico; 1907, Expert Special Agent in charge of School Statistics for the U. S. Industrial Commission; 1908, Chairman of the Commission of the United States to the Republic of Liberia; 1909, Financial Representative of the Republic of Liberia; 1911, Assistant Director of the Census; 1913, Member Joint T^and Commission, United States-Panama; since 1914, Lecturer, New York University; member In- ternational Institute of Statistics and other learned so- cieties; contributor to various statistical and economic periodicals and has prepared several Government Re- ports; 1915, Associate Editor, 1918, Managing Editor of the Alexander Hamilton Institute. Major B. Foster, M.A. Banking Principles Graduated from Carson and Newman College, 1910; Principal of Watauga Academy, 1910-1911; graduate stu- dent in Cornell University, 1911-1913; Fellow in Political Economy at Cornell University, 1912-1913; Assistant Pro- fessor of Economics and former Secretary of the New York University School of Commerce, Accounts and Fi- nance; author of several of the Modern Business Reports and the Modern Business Text on "Banking." Former assistant to the Chairman of the Federal Reserve Bank of New York, now assistant to Executive Committee, Alexander Hamilton Institute. Leo Greendlinger, M.C.S., C.P.A. (N. Y.) Financial and, Business Statements Graduate of the New York University School of Com- merce, Accounts and Finance; practising accountant; member of the Accounting Faculty of New York Uni- versity, 1907-1915; formerly Editor of the C. P. A. Ques- tion Department of The Journal of Accountancy ; member of the New York State Society of Certified Public Accountants; member of the American Institute of Ac- countants; member of the Executive Committee and Board of Directors as well as Secretary and Treasurer of the Alexander Hamilton Institute; author of "Account- ancy Problems," 2 vols.; and the Modern Business Text on "Financial and Business Statements." J. Anton deHaas Foreign Trade and Shipping Graduate of High School, The Hague, Holland; 1900, Diplomas in Accounting, and French, German and Dutch commei*cial correspondence, 1902; Junior Accountant with 102 J. H. Rosenboom, Public Accountant, The Hague, Hol- land, 1901-1904; A.B. Stanford University, 1910; M.A. Harvard University, 1911; Ph. D. Stanford University, 1915 ; Special Agent in Europe of the California Immigra- tion Committee, 1914; American representative for Mag- nesiet Werken, Ptotterdam, Holland, 1916; Instructor in Economics, Stanford University, 1913-1915 ; Lecturer For- eign Trade School, San Francisco, California, 1915; Ad- junct Professor of Business Administration, University of Texas, 1915-1917; Professor of Commerce, Ohio State University, 1917-1918; Examiner, Federal Trade Commis- sion, summer 1917; Professor of Commerce, University of Washington, Seattle, Washington, 1918; Lecturer on Foreign Trade, Columbia University, New York, summer 1918; Captain U. S. A., 1918; formerly Professor of For- eign Trade at the Commercial University at Rotterdam, Holland, 1919-1920; Professor of Foreign Trade, New York University, 1920. Author of Business Organization and Administration, and of Modern Business Text on "Foreign Trade and Shipping.'* Edward R. Hardy, Ph.B. Insurance Graduate of Boston University; formerly Librarian, In- surance Library Association, Boston; for several years engaged in investigations and administrative work for various insurance organizations; Secretary and Treasurer of the Insurance Society of New York, 1909; Manager of the Underwriters' Association of the District of Columbia, 1914; Lecturer on Insurance in New York University ^.., School of Commerce, Accounts and Finance; Assistant Manager of the New York Fire Insurance Exchange; co-editor of the "International Insurance Encyclopedia"; author of "History of Fire Insurance in Massachusetts" and contributor on Fire Insurance in the Modern Business Text on "Insurance." Warren F. Hickemell, Ph.D. Business Conditions Studied Political Economy at Yale University. M.A., 1909; Ph.D., 1919. Was economic expert with the Immi- gration Commission, 1910, and the Bureau of Census, 1910-1911. From 1911 until 1916 was Managing Editor of the Brookmire Economic Service. Author of "Business Cycles" and numerous articles on business and financial conditions. Lecturer on "Panics and Depressions" at New York L^niversity School of Commerce, Accounts and Finance. Director, Bureau of Business Conditions of the Alexander Hamilton Institute, since August, 1916. 103 Solomon S. Huebner, Ph.D. Marine Insurance Educated at University of Wisconsin. B.S., 1902; M., 1908. Dr. Huebner was a special lecturer on insurance and commerce in the University of Pennsylvania, 1904- 1906; Assistant Professor, 1906-1908, and Professor since 1908. Since 1919 Dr. Huebner has been expert in Insur- ance to the United States Shipping Board and to the Committee on the Merchant Marine and Fisheries of the House of Representatives. He has had charge of the Congressional Marine Insurance investigation. While serv- ing the Committee on the Merchant Marine he had charge of the shipping investigation v^^hich led to creation of U. S. Shipping Board and played a prominent part in forming the U. S. Shipping Act. Dr. Huebner is a special lec- turer on insurance in the Columbia University School of Business. He was expert for the Committee on Merchant Marine and Fisheries of the House of Representatives. He is author of works on Property Insurance, 1911; Life Insurance, 1915 ; Steamship Agreements and Affiliations in the American Foreign and Domestic Trade, 1913; Marine Insurance, 1920, and of the sections on Marine Insurance and Life Insurance in the Modern Business Text on "Insurance." Jeremiah W. Jenks, Ph.D., LL.D. Relation of Government to Business (See Advisory Council.) Joseph French Johnson, D.C.S., LL.D. Economic Problems (See Advisory Council.) Business Ethics Walter S. Johnson, K.C. Commercixil Law Educated in McGill University (B.A., B.C.L.); mem- ber of the Quebec Bar; practising law in Montreal; Lec- turer on the Law of Agency, the Law of Partnership and Lease and Constitutional History, McGill University; col- laborator in writing the Modern Business Texts on "Credit and the Credit Man" and "Business Organiza- tion"; author of the Canadian Modern Business Text on "Commercial Law"; editor, the Quebec Civil Code. Edward D. Jones, M.A. (Hon.), Ph.D. Investments Educated in Ohio Wesleyan University; graduated in 1892 with degree of B.S., M.A., 1912; entered University of Wisconsin and received degree of Ph.D. in 1895; In- structor in statistics and Economics, 1895-1898; Assistant Professor of Economics and Commercial Geography, 1900- 1901, University of Wisconsin; United States Commis- sioner to Paris Exposition, 1899-1900; Professor of Busi- ness Administration, University of Michigan, 1902-1919; member of International Association of Arts and Sci- 104 ences, St. Louis, 1903; holder of Diploma and Bronze Medal, Paris Exposition, and Gold Medal, Buffalo Expo- sition; during the war with the General Staff of the War Department, and with the War Industries Board; mem- ber of American Economic Association, of American So- ciety of Industrial Engineers and of Industrial Relations Association of America; now in charge of Harvard University Service in Foreman Training; author of "The Economic Crises," "The Business Administration," "The Administration of Industrial Enterprises" and of the Modern Business Text on "Investments." John G. Jones Sales Management Educated in Public School and University College of Wales, Aberystwyth; came to America in 1888 and en- gaged in newspaper work and mining in Montana and Colorado; engaged in sales work since 1903; Vice-Presi- dent and Director of Sales and Advertising of the Alex- ander Hamilton Institute since 1912; also a Director and member of the Executive Committee of Alexander Hamilton Institute; Special Lecturer on Salesmanship and Sales Management in the New York University School of Commerce, Accounts and Finance; chairman of the International Committee on Business Methods and In- dustrial Relations, Industrial Association of Rotary Clubs, 1920-21; author of the Modern Business Text on "Salesmanship and Sales Management." Dexter S. Kimball, A.B., M.E. Cost Finding Practical work with Pope and Talbot, Port Gamble, Washington, 1881-1887; entered shop of Union Iron Works, San Francisco, 1887, continuing this practical work until 1893; graduated Leland Stanford University, 1896; entered the Engineering Department of the Union Iron Works, 1896; Designing Engineer, Anaconda Mining Company, 1898; Assistant Professor Machine Design, Sib- ley College, 1898-1901; Professor Machine Construction, 1904-1905; Professor Machine Design and Construction, 1905-1915; Professor Machine Design and Industrial En- gineering, 1915-1919; Dean of the Engineering Colleges, Cornell University; member of Council on Industrial Education, New York State Department of Education, 1911; member of American Society Mechanical Engineers; member of Society for Promotion of Engineering Educa- tion; author "Elements of Machine Design" (with John H. Barr), 1909; "Industrial Education," 1911; "Princi- ples of Industrial Organization," 1913; "Elements of Cost Finding," 1914; contributor to scientific press; author of the Modern Business Text on "Cost Finding" and "Plant Management." 105 Bernard Lichtenberg, M.C.S. Advertising Principles Graduate of New York University School of Coinmerce, Accounts and Finance. Two years post-graduate study in advertising at New York University. Formerly with the Clark-Hutchinson Company, of Boston; and with the Business Book Bureau, New York City; Office Manager of the Alexander Hamilton Institute, 1912-1915; Assistant Director of Advertising since June, 1915. Co-author of the Modern Business Text on "Advertising Principles." Frank L. McVey, Ph.D., LL.D. Economics Born in Wilmington, Ohio, November 10, 1869 ; educated in Ohio Wesleyan University and Yale University, receiv- ing degree of Ph.D. in 1895 from the latter; also studied in England in 1898. He became Professor of Economics in the University of Minnesota in 1896; President of the State University of North Dakota in 1909-1917; now President of the University of Kentucky; Chairman of North Dakota State Educational Commission, 1911; mem- ber of North Dakota State Board of Education; member of American Economic Association; member of American Statistical Association, and member of other commercial clubs and societies; Secretary and founder of the Minne- sota Academy of Social Sciences; member and Chairman of Minnesota Tex Commission, 1907-1909, and member of other commissions and committees. Author of numerous tracts, books and pamphlets, including "Modern Indus- trialism," "Railway Transportation," "The Making of a Town," and Editor, National Social Science Series; col- laborator on the Modern Business Text on "Economics — the Science of Business." John Thomas Madden, B.C.S., C.P.A. (N. Y.) Accounting Practice Born in Worcester, Mass.; graduate of New York Uni- versity School of Commerce, Accounts and Finance (sum- ma cum laude) ; employed with Swift & Company's sub- sidiary interests in various capacities, 1900-1909; with Leslie & Company, Chartered Accountants, New York, 1910-1911; practising public accountant; Instructor in Ac- counting, New York University, 1911-1913; Assistant Pro- fessor of Accounting, 1913; now Professor of Accounting and Head of Department of Accounting, New York Uni- versity; special lecturer in accounting. Association of Employes, New York Edison Company; Treasurer, Old Colony Club; President, American Association of Univer- sity Instructors in Accounting, 1920-21; National Presi- dent, Alpha Kappa Psi fraternity, 1919-1920; and collab- 106 orator on the Modern Business Text on "Accounting Practice and Auditing." Mac Martin Advertising Campaigns Educated in Minneapolis public schools; graduate of University of Minnesota; President Mac Martin Adver- tising Agency; Ex-President Minneapolis Advertising Forum ; Agency Service Committee, American Association of Advertising Agencies; Professional Lecturer in Ad- vertising at the University of Minnesota; author "Plan- ning an Advertising Campaign for a Manufacturer"; au- thor "Modern Methods of Merchandising"; author "Mar- tin's Merchandising Reporting Service," and of the text on "Advertising Campaigns" in the Modern Business Series. G. F. Michelbacher, M.S. Compensation and Liability Insurance Graduate of the University of California, 1912; Teach- ing fellow in mathematics in the University, 1912-1913; lecturer in Insurance and Mathematics, 1913-1915; in charge of the preparation of the California Schedule for Rating Permanent Injuries, for the Industrial Accident Board of the State of California, 1913-1914; later super- intendent of the permanent disability rating department of the Industrial Accident Commission of the State of California and superintendent of the claims department of the State Compensation Insurance Fund; a year later became Statistician of the National Workmen's Compen- sation Service Bureau in New^ York, 1916-1920 Actuary of the Bureau; Secretary of the National Council on Workman's Compensation Insurance; contributor on Lia- bility and Workman's Compensation Insurance to the Modern Business Text on "Insurance," also Secretary of the National Council on Workmen's Compensation In- T. Vassar Morion, Litt.B. Graduate Rutgers College; engaged in sales work with the American Hard Rubber Company; office manager of the Voorhees Rubber Manufacturing Company; afterward Subscription Credit and Collection Manager of Double- day, Page and Company; member of the National Associa- tion of Credit Men; appointed Bursar of the Alexander Hamilton Institute October 1, 1918. Collaborator on the Modern Business Text "Credit and Collections." Bruce D. Mudgett, Ph.D. Life Insurance Graduate of University of Idaho; one year of graduate work at Columbia University and four years at Univer- 107 sity of Pennsylvania; seven years instructor in insurance, Wharton School of Finance and Commerce, University of Pennsylvania; Assistant Professor of Insurance, School of Business Administration, University of Washington, Seattle, Washington. On leave 1918-1919 as Statistical Economist, Bureau of Research, W^ar Trade Board, Washington, D. C. ; now Associate Professor of Economics, University of Minnesota. Joint author vi^ith S. S. Huebner of volume on Life Insurance; author of "The Disability Clause in Life Insurance Contracts;" several articles in economic periodicals; contributor on life insurance to the Modern Business Text on "Insurance." E. L. Stewart Patterson Domestic and Foreign Exchange Educated in England; entered Eastern Townships Bank at Sherbrooke in 1888; acted as Accountant for this bank in Granby and Montreal, 1889-1901; became Assistant Manager at Montreal in 1902; served three years (1904- 1907) as Assistant Manager at Sherbrooke; later became Manager, and in 1909 Assistant General Manager; since amalgamation of the Eastern Townships Bank with the Canadian Bank of Commerce, in 1912, has served as In- spector at Toronto, and is now Superintendent of the Eastern Townships Branches, with headquarters at Sher- brooke; fellow of Bankers* Institute, London; of Institute of Banking of the United States; and member of the Canadian Bankers' Association. Collaborator on the Modern Business Text on "International Exchange." Frederic E. Reeve, C.P.A. Accounting Born January 3, 1886; graduate of New York Univer- sity School of Commerce, Accounts and Finance, June, 1911. C.P.A. Degree, New York State, August, 1911. former instructor in Accounting at New York University School of Commerce, Accounts and Finance. Member of the firm of White and Reeve, Certified Public Account- * ants, 1913-1917. Since that date practising as a certified public accountant in New York City. Collaborator on the Modern Business Text on "Accounting Principles." Frederick C. Russell, B.C.S. Auditing Graduate New York University School of Commerce, Accounts and Finance. Formerly accountant for Carter, Howe and Company, manufacturing jewelers; connected with the Auditing Department of the New York Tele- phone Company; formerly Instructor in Accounting, New York University School of Commerce; Controller, Alex- ander Hamilton Institute since 1916. Author of the Mod- ern Business Text on "Accounting Principles." 108 Bernard K. Sandwell, B.A. International Finance Graduated Toronto University, 1897; began newspaper work in England, but returned to Canada in 1900; edi- torial writer on Toronto News; editorial writer and dra- matic critic on Montreal Herald; specialized in economic subjects, and in 1910 was one of the founders of the Montreal Financial Times and became editor of that pa- per; resigned 1918 to take present post of Assistant Pro- fessor of Economics, McGill University, Montreal; editor of the Canadian Bookman, 1918; National Secretary Ca- nadian Authors Association; author of financial section of "Canada and the Great World War." William W. Swanson, Ph.D. Money and Banking Studied at Queen's University, Kingston, Canada, and specialized in Economic Science under Dr. Adam Shortt; graduated with honors in 1905; Fellow at the University of Chicago in the Department of Political Economy, 1905- 1908; graduated Ph.D., 1908; author of "The Establish- ment of the National Banking System"; associate editor of the Montreal Journal of Commerce, 1914; since special writer for the Journal of Convmerce; contributor to Monetary Times and other financial journals in Canada;, investigated the unemployment problem for the Ontario Government Commission on Unemployment, 1915; Asso- ciate Professor in Economic Science in Queen's Uni- versity, Kingston, 1908-1916; Professor of Economics at the Provincial University of Saskatchewan, since 1916. John B. Swinney, A.B. Merchandising Graduated at Syracuse University in 1904; previous to entering college engaged in retail merchandising; 1904- 1906, Superintendent of Schools, Springville, N. Y. ; 1906- 1908, with John Wanamaker in retail merchandising; 1908-1913, with Longmans, Green & Company, in whole- sale merchandising; Assistant Secretary in charge of Service, Alexander Hamilton Institute, 1913-1917; Lec- turer on Wholesale Merchandising in New York Univer- sity School of Commerce, Accounts and Finance, 1916- 1917; editor Harper's Retail Business Series; Professor of Marketing, College of Commerce and Business Admin- istration, Tulane LTniversity, 1917. Lecturer on Merchan- dising in Columbia University, 1919. Now Superintendent of merchandising, The Winchester Stores (Chain Sporting Goods and Hardware Stores). Collaborator on the Mod- ern Business Text on "Marketing and Merchandising." 109 William H. Walker, LL.D. Financial Problems Educated in the WhartoK School of Finance of Univer- sity of Pennsylvania; Assistant Purchasing Agent, Con- solidated Lithograph Company ; later engaged by the same company in the installation of cost systems and the organ- ization of branch plants; a number of years Superin- tendent and Assistant Manager, Erie Lithographing and Printing Company; resigned to become President of the Grape Products Company; director and ofl&cer of numer- ous other corporations ; engaged for many years in special study of finance, corporations and business efficiency; financial counsel to corporations; lecturer and v^^riter on finance and corporations; in 1913, appointed Dean of the School of Accounts^ Finance and Commerce, Duquesne University, Pittsburgh; director, Pittsburgh Commercial Club; member of Pittsburgh Tax Commission and Chair- man of its Committee on Administration; author of the Modern Business Text on "Corporation Finance." 110 SPECIAL LECTURERS The Special Lecturers have prepared written lectures for the Modern Business Course and Service, presenting results of their successful business experience. Erastus W. Bulkley Partner, Spencer Trask ^ Company Graduated from New York University in 1891; five years later receiving a degree from the New York Col- lege of Pharmacy. Following a short period of service with the Pennsylvania Railroad Company, he entered the service of Spencer Trask & Company, Investment Bankers, in 1898, as assistant manager of their Albany, New York, office. Six years later he was appointed sales manager of the New York City office; in 1906, he was admitted as a partner in that firm, and is at present an active member. He established the educational courses now in use by Spencer Trask & Company for salesmen and office employes. He is recognized among investment bankers as a close student of finance, es- pecially of the methods of distributing securities to individual investors. Governor and Chairman of the For- eign Relations Committee of the Investment Bankers' Association of America, 1912-1915; member of the Ad- visory Board of New York University School of Com- merce; member of the American Economic Association and of the American Academy of Political and Social Science. Herbert S. Collins Vice-President and General Manager, United Cigar Stores Company Born in Orleans County, New York; became a clerk in Mr. Whelan's cigar store, becoming the manager of the business; came to New York in 1900, and was one of the first salesmen of the United Cigar Stores Company; as sales manager Mr. Collins is credited with the de- velopment of window display in the United Cigar Stores; in the arrangement of goods visible from the sidewalk, he takes special interest, in order that it may dovetail with the other advertising of the store. Ill Henry M. Edwards Auditor, New York Edison Company Born in New York City; educated at College of the City of New York; had short experience in wholesale dry goods and fire insurance business; was connected suc- cessively with the office, manufacturing and selling or- ganizations of John Anderson and Company, Tobacco Manufacturers; entered the employ of the Manhattan Electric Light Company, 1889, as bookkeeper; subse- quently appointed Auditor of the company, and two years later was made Director and Secretary, which of- fice he retained until the company, in 1900, was con- solidated with the Edison Electric Illuminating Com- pany; was in charge of the financial operations incident to the consolidation of all the companies forming the present New York Edison Company, of which company he was made Auditor; has been Chairman of the Ac- counting Committee of the National Electric Light As- sociation, since 1907; author of "Electric Light Accounts and Their Significance;" has contributed to trade journals and other magazines, many papers on accounting and financial subjects and has delivered many addresses on these subjects. Harrington Emerson Efficiency Engineer Born in Trenton, N. J.; educated in Paris, Munich, Vienna, Athens; took the mechanical engineering course in Royal Polytechnic, Munich; professor in University of Nebraska, '1876-1882; after 1883 engaged in profes- sional work with C, B. & Q., Union Pacific and Santa Fe Railways; now president of the Emerson Company, Efficiency Engineers; author of various important works which have had a strong influence on business methods, including "Efficiency" and "Twelve Principles of Ef- ficiency." Charles Ernest Forsdick Controller, Union Oil Company Born at Greenwich, England; educated in the grammar schools there, later attended Morden College and the Shrewsbury Schools; came to the United States in 1888, and until 1893 was engaged in accounting work in the Southern States; then became affiliated with the account- ing department of the Lehigh Valley Railroad Company in Philadelphia, of which company he became general bookkeeper; in 1901 Mr. Forsdick became associated with Haskins and Sells, certified public accountants in New York, with whom he remained for ten years; he became 112 Associate at Large of the American Association of Pub- lic Accountants and a member of the Institute of Ac- counts, and was for four years a member of the faculty of the New York University School of Commerce, Ac- counts and Finance. Orlando C. Ham Advertising Manager, National Lead Company Born in Dayton, Ohio; educated in Ohio Weskyan Uni- versity and in Cornell University; entered business as clerk in a retail book store, afterward engaged in news- paper and trade paper work; at one time advertising manager of H. J. Heinz Company; chairman, National Advertising Commission; for two terms president of the Technical Publicity Association; was the second president of the Association of National Advertising Managers; now advertising manager and diairman of the sales com- mittee of the National Lead Company; originator of the "Dutch Boy" trade-mark. A. Barton Hepburn Chairman Advisory Board, Chase National Bank, New York Born at Colton, N. Y.; graduated from Middl^bury College and received degrees of LL.D. and D.C.L. at St. Lawrence, Columbia and Williams College. Practised law in New York State, was appointed superintendent xri the Banking Department for New York and later Comp- troller of the Currency. In 1892 he was made President of the Third National Bank of New York, then Vice- President of National City Bank, and later President of the Chase National Bank of New York. He is di- rector of a number of prominent financial, industrial and commercial organizations; trustee of Middlebury College and Rockefeller Foundation ; member of New York Cham- ber of Commerce and various scientific and literary societies. Lawrence M. Jacobs Vice-President, International Banking Corporation Born in Sturgis, Michigan; graduated from the Uni- versity of Chicago in 1899; was sent by the Government in 1900 to the Philippine Islands, China and Japan; in 1903 he entered the National City Bank of New York; in 1909 he was made foreign representative of the Na- tional City Bank; when the National City Bank acquired the International Banking Corporation and the Interna- tional Bank, he was made Vice-President of the former and the President of the latter. 113 Jackson Johnson Chairman of the Board, International Shoe Company Bom Ir LaGrange, Alabama; entered the general store business in Holly Springs, Mississippi; for five years en- gaged in the wholesale shoe business. In 1898 moved to St. Louis, and was one of the leaders in organizing the Roberts, Johnson and Rand Shoe Company; Presi- dent of tliis con^pany until 1911, when the International Shoe Company was formed by the consolidation of the Roberts, Johnson and Rand Shoe Company and the Peters Shoe Company. In 1912 the Friedman-Shelby Shoe Company was purchased and became one of the sales branches of the International Shoe Company. Mr. Johnson was elected the first president of the Interna- tional Shoe Company, a position which he held for five years, and until he was chosen chairman of the board the position which he now fills. Is director in the First National Bank in St. Louis and the St. Louis Union Trust Company; member of the Board of Trustees of Washington L^niversity. For two terms, ending No- vember, 1919, was president of the St. I^ouis Chamber of Commerce and during his incumbency the activities of tills organization were greatly extended and intensified. During the war he served the Government as regional advisor to the War Industries Board. Fowler Manning Sales Manag^^er, Diamond Match Company Born in Texas; entered business as a traveling sales- man; he left the road to join the inside sales organiza- tion of the Meyer Brothers' Drug Company, SL Louis, with a view to securing an insight into the methods em- ployed in the sales management of a large successful business; specialized in sales organization and sales re- organization to broaden still further his experience in connection with specialty lines. Finley H. McAdow Past President of the National Association of Credit Men Born in Ohio; educated in Ohio; entered Chicago Branch of Clias. Scribner's Sons as bookkeeper; two years later he became Assistant Superintendent and Cost Ac- countant for Racine (Wis.) Hardware Manufacturing Company; Secretary and Treasurer of Staver Brothers Carriage Company of Chicago; has long been associated with the National Association of Credit Men, having served vvith honor as Director, and President of the Chicago Local Association, and as Director, Vice-Presi- 114 dent and for two terms President of the National Asso- ciation of Credit Men. He is a Lecturer on Credits in Central Y. M. C. A. of Chicago and Credit Manager of Skinner Brothers of Chicago. General Charles Miller Former Chairman of the Board, Oalena-Signal Oil Company Born in Alsace, France, Educated in France; given de- gree of A.M., Bucknell University; entered oil business^ 1869, and had been President Galena-Signal Oil Company since its organization; director in over forty industrial corporations ; entered the Civil War vi^hen twenty years of age; formerly Mayor of Franklin, Pa.; commissioned in National Guard of Pennsylvania, 1880, as Major; pro- moted to Brigadier General and Major General command- ing the National Guard, retiring in 1906; decorated by French Government as Chevalier of Legion of Honor for eminent services to industry and commerce. Melville W. Mix President j Dodge Manufacturing Co. Born in Atlanta, 111.; at the age of twenty-one en- tered employ of Dodge Manufacturing Company of Mishawaka, Ind., and held various positions in the com- pany; in 1894 he was elected Vice-President and Gen- eral Manager, and in 1896 President of the company; was formerly President, American Supply and Machinery Manufacturers' Association; Vice-President from Indiana of National Association of Manufacturers; served two years as Mayor of Mishawaka, and later as member for Indiana of Louisiana Exposition Commission; was sub- sequently appointed by the Governor of Indiana as mem- ber of commission to investigate laws and conditions of woman labor and to recommend proper legislation in connection therewith. Emmett Hay Naylor Secretary-Treasurer, Writing Paper Manufacturers' Association Educated in Dartmouth College, New York Law School, and Graduate School of Harvard University; for four years Secretary of the Springfield (Mass.) Board of Trade; held honorary offices of President of the New England Association of Commercial Executives and Sec- retary-Treasurer af the American Association of Com- mercial Executives; later Secretary-Treasurer of the Western New England Chamber of Commerce; now Sec- retary-Treasurer of the Writing Paper Manufacturers' Association; also Secretary-Treasurer of the Cover Paper and Tissue Paper Manufacturers' Association; special 116 lecturer before the graduate schools of Dartmouth Col- lege, Harvard and New York Universities; author of various magazine articles concerning the principles and possibilities of commercial organization vv^ork. Holbrook F. J. Porter Consulting Engineer Born in New York City; educated, Lehigh University; served successively with several industrial corporations, 1878-1894; western representative, Bethlehem Steel Com- pany, 1894-1901; eastern representative, 1901-1902; Vice- President and General Manager, Westinghouse-Nernst Lamp Company, 1902-1905; consulting industrial engineer in independent practice in New York since 1905. Welding Ring Exporter Born in Cornwall, N. Y.; entered business in 1864 as clerk in an importing house; after spending a year in the importing establishment, spent several years in a grain and flour commission business; since that time has been engaged in exporting to Australia, New Zealand, South Africa and Europe; has visited all these countries, as well as China, Japan -and the East Indies, and has studied their problems at close range; now senior mem- ber of the exporting firm of Mailler and Quereau; Direc- tor and Vice-President of the United States and Aus- tralia Steamship Company; member of the New York Chamber of Commerce and Chairman, Executive Commit- tee of the Produce Exchange and Maritime Exchange; ex-President, Exporters and Importers' Association; Di- rector, Foreign Trade Council; Trustee, Williamsburg Savings Bank. Arthur Webster Thompson President^ Philadelphia Company of Pittsburgh Born in Erie, Pa.; graduated in 1897 from Alle- gheny College with the degree of Civil Engineer; was rodman on location work for the Pittsburgh, Buffalo and Lake Erie Railroad; was appointed Assistant Division Engineer of the Baltimore and Ohio Railroad at Pitts- burgh in 1900 and gradually rose until in July, 1916, he became Vice-President of this railroad in charge of Traffic and Commercial Development; is President of the Board of Trustees of Allegheny CoUege and a member of the following scientific societies: American Railway Asso- ciation (Vice-President) ; American Society of Civil En- gineers; American Railway Engineering Association; En- gineers' Society, Western Pennsylvania; American Acad- . emy Political and Social Science; is a director of the 116 National Bank of Commerce and of the Citizens Company of Baltimore, and Chairman of the Board of Managers and Director of the Washington (D. C.) Terminal Com- pany; member of the Special Committee on National Defense, of the American Railway Association; appointed by the Governor a member of the Maryland Preparedness and Survey Commission. Frederick S, Todman General Manager Hirschy LilUenthal ^ Company Born in New York City; educated in New York Uni- versity, which institution later bestowed upon him the degree of Master of Commercial Science; Mr. Todman early specialized in the subject of finance with particular reference to the work of Wall Street and the Stock Ex- changes. On these subjects he has written extensively for the magazines and the public press; author of "Brokerage Accounts;" in 1914 identified with the Finan- cial Department of the New York University School of Commerce, Accounts and Finance. John Conselyea Traphagen Treasurer, Mercantile Trust and Deposit Company of New York Educated in New York University; became manager of statistical department, Standard Statistics Company, 1910; elected a director, 1914, and Vice-President of this company in 1915; became Assistant Secretary of the Franklin Trust Company of New York, 1916. He is now the treasurer of the Mercantile Trust and Deposit Com- pany of New York; he is a trustee of the American Sav- ings Bank, and secretary to reorganization committees of some of our largest railroad and street railway systems. John Wanamaker Merchant At the age of fourteen was errand boy in a book store; later he became salesman in a clothing store; and at twenty-four founded a small clothing establishment in Philadelphia; in 1876 he established his general store in Philadelphia, and in 1896 revived the business of Mr. A. T. Stewart in New York; today the Wanamaker stores in New York and Philadelphia are among the largest of their kind; has been actively interested in politics and was Postmaster-General of the United States in President Harrison's cabinet, where his capacity for organization won him marked distinction; he has always been inter- ested in philanthropic, religious and educational work; he founded the Presbyterian Hospital, and also the Beth- any Presbyterian Church Sunday School; in 1912 he was 117 given the aecoration of OiHicer of the Legion of Honor by the French Government. Walter N. Whitney Vice-President, Continental Grocery Stores, Inc. Born in Elniira, N. Y.; educated in the Public Schools of Buffalo, N. Y. ; began his business career in the Central Railway Clearing House; three years later he entered the service of the l^arkin Company. Subsequently Mr. Whitney found his sphere in the advertising and sell- ing departments, working his way through the various branches; in 1916 he originated and conducted an adver- tising and selling campaign that is said to have been one of the most successful campaigns in the history of Larkin Company. More than $3,000,000 worth of business was credited to that campaign. I>ater he was associated with the mail-order work of Merrell-Soule & Company, manu- facturers of food products at Syracuse, N. Y. He is now Vice-President, Continental Grocery Stores, Inc. 118 Summing it up: Isn't It true that many of the interests in your life are centered on your business progress? So much depends on your success or failure in business. Your daily bread, your social position, your ambition, the welfare of your family, every- thing you expect to be and have may be decided for or against you by your accomplishments in business. Do you consider as seriously your plans of how you are to succeed as you do your plans of what success you hope to attain? Surely, since so much depends on it, isn't it your duty to take advantage of every possible opportunity to better your conditions right now? Briefly stated, the Modern Business Course and Service offers you a thorough training in practical business knowledge — a training that prepares you to become a better business man. It is helping thousands of other men in a dollars and cents way. It can help you too. Our subscribers do succeed faster, do accom- plish more, do make more money than the aver- age business man. The evidence is overwhelm- ing. The value of the Course and Service is established. No thinking man can doubt it. The question is, are you willing to override the countless insignificant objections and con- 119 sider the one big fundamental reason why you should enrol? Are you willing to sacrifice a little time, a little money, a little effort in order to attain success in the biggest factor in your life — business? If you have confidence in your ability, if your ambitions are sincere — you can't decide against it. You will take this first step toward bigger business success now by joining the 145,000 other progressive men who are following the Modern Business Course and Service. PRESS OP ANDREW H. KELLOGG CO., NEW YORK 120 14 DAY USE RETURN TO DESK FROM WHICH BORROWED LOAN DEPT. This book is due on the last date stamped below, or on the date to which renewed. Renewed books are subject to immediate recall. ^PR 6M \0\ M^a^C^ RECP I P DEC 1 9 1 61 v^ ^ ^ LD 21A-50m-12,'60 (B6221sl0)476B ^ 75 ^(^ General Library University of California Berkeley YB 06049 ivi501553 AGA3