HF 1101 129 A A sou 1 DO 6 GIONALL 8 5 1 FACII 8 THE LIBRARY OF THE UNIVERSITY OF CALIFORNIA LOS ANGELES s lINIVERSlTY'orCALIFORNIA, LIBRARY, tJOS ANGELES, OAHF, e'- i UNIVERSITY OF ILLINOIS Conference on Commercial Edu cation and Busmess Progress in connection with the dedication of the Commerce building, April Sixteen and Seventeen, Nineteen Hundred and Thirteen URBANA-CHAMPAIGN, ILLINOIS PUBLISHED BY THE UNIVERSITY 1913 SOUTHERN BRANCH. UNIVERSITY OF CALIFORNIA, LIBRARY, <-OS ANGELES, CALIF. 65232 Copyright, 1913 By the University of Illinois •^ CONTENTS PAGE Introduction i FIRST SESSION BUSINESS ADMINISTRATION IN ITS RELATION TO PUBLIC AND PRIVATE WELFARE The Public Concern in Improved Business Administration ii Harry A. Wheeler, President of the Chamber of Commerce of the United States Some Business Tendencies i8 S. T. Henry, IVestem Manager of the Engineering Record The Business Problems of Agriculture 24 Charles A. Ewing, Attorney SECOND SESSION BUSINESS ADMINISTRATION IN ITS RELATION TO PUBLIC AND PRIVATE WELFARE What a Budget May Mean to the Administration 35 Frederick A. Cleveland, Chairman of the Commission on Economy and Efficiency Origin and Progress of Business Education in the United States.... 51 Edmund J. Ja?.ies, President of the University of Illinois THIRD SESSION COMMERCIAL EDUCATION AND BUSINESS SUCCESS Commencing Right 69 Alexander H. Revell, President of Alexander H. Revell &• Company The Relation of a School of Commerce to the Practical Problems OF Business 84 Leon C. Marshall, Dean of College of Commerce and Administration, University of Chicago The Questionnaire of the Illinois Manufacturers' Associ.\tion on College Courses in Business Administration 92 Julius W. Hegeler, Chairman, VV. E. Clow, John E. Wilder, Com- mittee on Education FOURTH SESSION DEDICATION OF THE COMMERCE BUILDING The College Graduate a Business Tyro — A Matter of Adjust- ment lOI Howard Elting, President of the Chicago Association of Commerce Schools of Commerce and Improvement of Business 119 David Kinlev, Director of the Courses in Business Administration, Uni- versity of Illinois Presentation of the Commerce Building to the President of the University 133 W. L. Abbott, President of the Board of Trustees, University of Illinois Acceptance and Address — University Instruction for Business Men 136 Edmund J. James, President of the University of Illinois Presentation of the Portrait of the late E. J. Parker of Quincy, Illinois 151 B. F. Harris, Representing the Illinois Bankers' Association Joint Banquet, Dedication of the Commerce Building, University of Illinois 153 The Commercial Club of Urbana and The Chamber of Commerce of Champaign INTRODUCTION The dedication of the Commerce Building at the Uni- versity of Illinois, which was erected during the year 1912, was made the occasion of a Conference on Commercial Education and Business Progress extending over two days, April 16 and 17, 1913. The papers and addresses that were presented on this occasion constitute the present volume. Acknowledgment should be made at this point of the in- debtedness of the Director and Faculty of the Courses in Business Administration to the many persons, especially the speakers, whose generous co-operation made this occa- sion a success. The Commerce Building is the most recent of several new additions to the physical plant at the University of Illinois, and is devoted to the study of economics, com- merce, public and private finance, railway administration, money and banking, business organization and manage- ment, accountancy, insurance, statistics, and related sub- jects. In explanation of the significance of the erection and dedication to such uses of this building, a circular was published upon this occasion, which may properly be quoted at this point. The Courses in Business Administration The University of Illinois showed an early interest in the training of business men. The first circular of infor- mation published in 1868 declared it to be one of the aims of the institution to prepare men "for the arduous and riskful responsibilities of the merchant and business man." The original nine departments of the University included one of "Commercial Science and Art," in charge of which was placed Captain Edward Snyder, subsequently Pro- fessor of German and Dean of the College of Literature and Science. In 1870, the University rearranged its 1 2 COMMERCIAL EDUCATION AND BUSINESS PROGRESS whole curriculum, and the commercial department was thereafter called the "School of Commerce." Book- keeping, commercial calculation, and commercial corre- spondence were the principal subjects of the course. In 1878, an attempt was made to raise the standards of the School of Commerce by adding a second year's course, but there was little call for such a development, and on Septemeber 10, 1879, the Board of Trustees passed a resolution to the effect that "the course of studies in the 'School of Commerce' is more extensive than is practicable to teach at the present time.'' On June 10, 1880, the Board voted to discontinue the school. The attempt to construct a university school of commerce along the lines of a "busi- ness college" had proved unsuccessful. The school had done little more than to prepare clerks and bookkeepers. It had not been realized that the function of a university school of commerce was to prepare for future leadership in economic enterprise, not for clerkships. Twenty-two years passed before interest in university commercial education was revived. The abandonment of the first school of com- merce was an inauspicious event but, in reality, a beneficial one, since it put an end to the "business college" conception of university commercial education, and offered a clear field for the re-establisliment of the work on its only proj^er basis, that of economic science. About 1899-1000, several of the leading universities of the country had become convinced of the desirability of a more systematic organization of courses that should pre- pare students for careers in commerce. To phice the Uni- versity of Illinois in line with this movement, an appropria- tion wiis asked for. It was obvious to iho Tionrd of Trus- tees that an excellent foundation for such ex})ansion had already been laid by the department of economics, and, accordingly, an appeal for funds was made to the legisla- ture. An appropriation was iiiMde nnd, in 1902, the Scliool of Coninicrce was re-established under the title of "The Courses of Training for Business," Professor Kinley being aytpoiritcd Director. Two ndditional ])rofessorsliips were INTRODUCTION 3 established — one in commerce, and the other in industry and transportation. The effect of the new policy was immediately apparent. The total number of registrations in courses in economics had been 253 for the two semesters of 1901-1902. In 1902-1903, this increased to 309 ; in 1903-1904 to 735 ; by 1900-1907, it liad reached 1,143. This striking increase came about not only because a larger number of students elected a full four-years course in business, but because many sought some of the courses to supplement their other studies. The success achieved by the courses led, in 1907, to an increase of appropriation, which enabled expansion to be made in the following groups of work : railway adminis- tration, accountancy, and industrial history. The con- tinued interest of the general administration of the Univer- sity in the work of business training had been insured by the election of Edmund J. James, at one time Director of the Wharton School of Economics and Finance at the University of Pennsylvania, to the presidency of the Uni- versity, in 1904. The growth in enrollment since 1907 has been marked. The registration in the courses has increased to 2,125 for the year 1912-1913, representing about 1,500 individuals, of whom 225 are registered for full four-year courses prepar- ing specifically for business careers. The rapid increase in courses and students early brought into prominence the urgent need of special accommodation for the work in commerce. The business interests of the state soon saw that, to secure full service from the courses, a special build- ing was required. With their help, the legislature was con- vinced of the necessity, and, though the amount requested by the Board of Trustees was not granted, an appropriation of |125,000 was made, in 1911, for the erection of what will be known in the future as the Commerce Building. The building was sufficiently completed by February, 1913, to be ready for occupancy, and most of the work of the busi- ness courses was transferred to it. 4: COMMERCIAL EDUCATION AND BUSINESS PROGRESS The anticipated advantages of the new building are being fully realized. The students in business adminis- tration are beginning to feel an individuality previously unknown, the unprofessional character of their training seems to become more distinct, the instructors have been brought into more intimate touch with one another and with their students, much to the advantage of all concerned. The work in accountancy, statistics, banking, railway administration, commerce, and in other subjects is now capable of being developed, and will be developed, to a degree of practical eflBciency unattainable in the past. And it is not an unpleasing thought to the citizens of Illinois, as Avell as to the members of the University, that, in develop- ing its facilities for the training of men to fill positions of responsibility in both public and private administrations, the State of Illinois has placed itself in the vanguard of educational progress. Much has been done, during the past eleven years, in the development of the courses in business administration, but much still remains to be done. There are already indications that the accommodations of the new Commerce Building will not be adequate to the demands that will be made upon it. It is not merely a case of the provision of recitation rooms. Modern methods of instruction in what may fitly be termed business technology call for generous provisions of museums, laboratories, instrument ror)iiis, and so forth. To meet the actual needs of the busi- ness world, it will be necessary to expand the courses in accountancy, business organization and practice, commer- cial law, and other subjects, and new courses in such subjects as salesmanship, advertising, and secretarial work are being called for. Two years have elapsed since the building was antliorized. The enrollment of students taking work in ccoiiomics and commerce during these two years has increased forty per cent. Such progress shows a lively appreciation of the benefits of training in IniKincss sul)jects, throws a corresponding obligation upon the University and the State to see that this desire for INTRODUCTION 5 economic eflQciency on the part of the youth of the State is met by provision of proper and adequate facilities. The Commerce Building The new Commerce Building is centrally located on the University Campus, standing a little south of University Hall, and facing on Burrill Avenue. In its architecture, the building harmonizes with the other structures on the south Campus, though differing from them considerably in style. The first story and the cornice are constructed of white stone, while the rest is in brick of the type used in the adjacent buildings. The east facade is the only part of the present structure which will show when the building is completed. This facade is somewhat more elaborate in its detail than is the case of any other build- ing on the Campus. Its most striking feature is the broad entrance, flanked by large stone pylons supporting massive bronze lanterns. The spacious but simply designed entrance hall, with marble w^ainscot and low vaulted ceiling, leads directly to a large lecture room seated in amphitheater fashion, which furnishes comfortable accommodations for several large lecture courses. The room is well lighted and ventilated and will be equipped with the most improved type of lan- tern for stereopticon illustration. Corridors leading north and south from the entrance liall give access to two otlier large lecture rooms, to the offices of the Director and Assist- ant Director of the Courses in Business Administration, and to the stairways leading to the upper floors. On the second floor are located the offices of the pro- fessors of railway administration and commerce, a large lecture room, seating about one hundred, and equipped with a lantern for the special use of the courses in commercial subjects, and two smaller class rooms for the use of advanced classes in business administration. The statistics and commerce laboratories and the commerce reading-room are also located on this floor. The statistics 6 COMMERCIAL EDUCATION AND BUSINESS PROGRESS laboratory is being equipped with the machines, apparatus, and books necessary for the most advanced statistical inves- tigation along all lines. The commerce laboratory is fur- nished with an extensive collection of commercial products, maps, charts, etc. In the reading room, current financial and trade newspapers and periodicals, as well as general reference works in commerce, will be kept on file. On the third floor are the accountancy rooms, addi- tional class rooms, and the offices of the professors of indus- try and accountancy and of the instructors in the business courses. The rooms for the use of the courses in account- ancy consist of a laboratory and a machine room. The accountancy laboratory, about eighty feet long and thirty feet wide, is the largest room in the building. It is fur- nished with drafting tables for the use of students in designing accounting forms and handling the books used in the accounting courses. Eventually, the accountancy machine room will be more fully equipped with the various machines used in business and accounting offices. Many of these machines are electrically operated and the neces- sary connections have been installed in the room. As a whole, the building is substantially constructed, simple in plan, and convenient and well adapted to the jjurpose for which it is intended. Program The program of the Conference on Commercial Educa- tion and Business Progress consisted of three parts. On the first day the general topic was Business Administration in its Kelation to Public and Private Welfare, and in the papers read at the two sessions held, the twofold aspect of business Mduiinistration was clearly brought out. On the morning of Thursday the second conference was held on the general subject of Commercial Education and Business Ruccoss; here the need of training for business was empha- sized. In the afternoon the formal exercises of the dedica- tion took place at a general University convocation. In INTRODUCTION 7 the evening a successful and largely attended dinner was given at the Armory, under the auspices of the Chamber of Commerce of Cliampaign, and the Commercial Club of Urbana. The keynote of the evening's addresses was co- operation. The following is the program of the conference as a whole: I. Conference, Wednesday,, April i6 "Business Administration in Its Relation to Public and Private Welfare," W. B. McKinley, President of the Illinois Traction System, Chairman. Afternoon Session, The Commerce Building, 2:30 p.m. "The Public Concern in Improved Business Adminis- tration," Harry A. Wheeler, President of the Chamber of Commerce of the United States. "Some Business Tendencies of the Day," S. T. Henry, Western Manager of the Engineering Record. "The Business Problems of Agriculture," Chas. A. Ewing, Decatur, Illinois. Discussion. Evening Session, Morrow Hall, 7 130 p.m. "What a Budget May Mean to the Administration,'^ Frederick A. Cleveland, Chairman of the President's Com- mission on Economy and Efficiency. "Business Administration," Edmund J. James, Presi- dent of the University. II. Conference, Thursday, April 17 "Commercial Education and Business Success," W. L. Abbott, President of the Board of Trustees, Chairman. The Commerce Building, 9:30 a.m. "Commencing Kiglit," Alexander H. Bevell, President of Alexander H. Revell & Company. "The Relation of a Scliool of Commerce to the Practi- cal Problems of Business," Leon C. Marshall, Dean of the College of Commerce and Administration, The University of Chicago. 8 COMMERCIAL EDUCATION AND BUSINESS PROGRESS The Report of the Committee on College Courses in Business Administration. Presented by Charles L. Stew- art, Research Assistant in Economics, University of Illinois. Discussion. III. Convocation The Dedication of the Commerce Building, the Presi- dent of the University, presiding. The Auditorium, 3 :oo p.m. Prelude, the University Band. Invocation, Reverend Doctor McClelland, President of Knox College. "The College Graduate a Business Tyro — a Matter of Adjustment," Howard Elting, President of the Chicago Association of Commerce. "Schools of Commerce and Improvement of Business," David Kinley, Director of the Courses in Business Adminis- tration. Presentation of the Commerce Building to the Presi- dent of the University, W. L. Abbott, President of the Board of Trustees. Acceptance and Address, President Edmund Janes James. Presentation of the Portrait of the late E. J. Parker, of Quincy, Illinois. Presented by Mrs. Parker. Address on Behalf of the Illinois Bankers' Association by B. F. Harris, Past President of the Association. Recessional March, the University Band. Adjournment to the Commerce Building. Prayer of Dedication, Reverend Doctor McClelland. IV. Dinner The Armory, 6:30 p.m. Sul)Hcriy)tion Dinner, in honor of the Dedication, given by the ('liniiibcr of Commerce of Ciianipjiign and the Com- mercial Club of Urbiina. FIRST SESSION BUSINESS ADMINISTRATION IN ITS RELATION TO PUBLIC AND PRIVATE WELFARE The Public Concern in Improved Business Administration Harry A. Wheeler President of the Chamber of Commerce of the United States The public concern in improving business administra- tion may mean the interest or concern which the public has in improving business administration, or it may mean the interest or concern which the public should have, I am not quite clear in my own mind as to which Avas intended by the committee in opening the program with this topic. It may be presumed that the public is deeply interested and concerned regarding an improvement of eflSciency in business administration. But as yet, so far as I have been able to observe, there has been no definite evidence of public interest in this question to the end of hearty public co-operation. Now by that I do not mean that there has been any lack of giving of public funds for the construction of buildings like this for the maintenance of commercial and industrial efficiency courses, for money has been given freely out of public funds for this work in order that a higher scale may be evident in every branch of human endeavor; but if production due to the increased efficiency is on the other hand offset by new elements of cost that are in no wise related to the intrinsic value of the product — if efficiency in production, efficiency in salesmanship, effi- ciency in accountancy and financing, are obtained by devis- ing systems whose expense of maintenance must be consid- ered as an offset to these things, the new element of cost balancing efficiency due to the actual value of the prod- uct — then efficiency has failed in its true aim and pur- pose. For the true aim of efficiency can be only to maintain the highest standard of a product and to cheapen its cost of production so that it may be offered to the general pub- lic, the ultimate consumer, at a lower price than heretofore. Obviously, all the efficiency that may be taught, if it leads ^ 11 12 COMMERCIAL EDUCATION AND BUSINESS PROGRESS to no more than to increase the elements of expense, if the new elements of expense cater to the taste or please the eve, or if in the distribution the cost of distribution is made sufficiently great to offset the savings of efficiency in pro- duction, then you have absolutely lost the value of effi- ciency. Now I am not taking this particular point of view for the purpose of following it out to any logical conclu- sion or argument as to whether we are in the day of unwise efficiency through the cutting off of certain elements of ex- pense in one direction and adding in another, so that we find ultimate equalization. That would be too narrow a subject for us to consider this afternoon. Neither am I inclined to pursue the topic, which would perhaps be rather negative, but I bring it to your minds for this reason: there can be no efficiency of production or of distribution, unaccompanied by public co-operation, that will ultimately aid the work for which money has been spent and courses have been founded. Our difficulty in this country today is the endeavor not to induce the manufacturer to adopt efficient methods of production, nor the distributer to adopt efficient methods of salesmanship and accounting, but rather to impress upon the people at large the necessity of co-operation in all of these efficient methods in order that after all, in the final analysis, the cost of living may be reduced, the value of production may be increased, and good may come to the people at large. It is a matter of public education, or of education of the public, quite as much as it is a matter of study. There is a question whether the manufacturer will find as he pursues the policy of efficiency in production, that labor, as a part of the public, is altogether in sympathy with the efficiency methods that are adopted and introduced. There is a question in the mind of labor today as to whether the efficiency that comes from getting the highest production out of a given piece of machinery is or is not in the interest of labor. Running through the entire realm of efficiency ojicratioTi, in shop, or in the mill, or in the office, or in the mine, or in ihc field, there is the same general element to PUBLIC CONCERN IN BUSINESS ADMINISTRATION 13 contend with; the agriculturist cannot see that it is to his advantage to introduce high efficiency unless he has first had the demonstration that it will increase his profit, and from a selfish point of view he has been inclined to judge from old time methods. All along the realm of our eco- nomic life, in our agricultural pursuits, and so up and down the range of production of those products which are natui'al and those products which are converted, we find the same difficulty that efficiency must be a double-barreled proposition and must have its base in the production of the farm or the production of the mill, and must have its co-operation in the hearts and the minds and in the will of the people themselves. For there is no ultimate value in reducing the cost of an article in the mill unless you have certain advantages of co-operation with the people at large to incline them to accept this particular article without frills and without favors — things that make for intrinsic value and that reduce cost, and therefore reduce cost of living. I was told to speak for twenty-five minutes. If I were to try to pursue the advantages of administration in re- duced cost of production, or of distribution, I could not cover one single point of either of these phases of this sub- ject in the time allotted. I am going to take an entirely different course than that because, as President James has said, the conference is for the purpose of ascertaining what may be done with this plant which you have created here at the University of Illinois to make it effective and to make it useful to the people of the State and the people of the country. It can be of the greatest service if it is used to create a healthy public sentiment that shall be co-opera- tive with the desire for greater efficiency and for better business methods. There is no one source of instruction that will reach the public so well as through the organiza- tion known in this State and in other states as chambers of commerce, or boards of trade, or trades organizations. In a decade there has come a change over the commercial life of this country. Organizations, originally established 14 COMMERCIAL EDUCATION AND BUSINESS PROGRESS for the purpose of stimulating trade, have broadened the scope of their action until today their work is largely civic and secondarily commercial. After all, only as civic condi- tions are ideal can commercial conditions be made ideal. These organizations in ten years have sprung up all over the country in great numbers. Every city of any mag- nitude has many; every town has several, oftentimes, and one surely — organizations where the citizens in business pursuits join together for the purpose of stimulating in- terest in their city, of increasing its industrial prosperity, and its commercial prosperity, and of making it a better place to live. These organizations have become educative factors not only to the industrial community, but likewise to that community which has to do with production, whether it be of the field, or of distribution whether it be of farm products, or natural products, or products of the mill. And it is the most helpful and most hopeful sign in our country that business men, through these organizations, have come to see their duty to the general public in an entirely' different light. It is not a question, ladies and gentlemen, of whether a product is produced at the lowest possible price, or the mill is kept running at the lowest pos- sible cost, or whether salesmanship is of the highest possible order ; but the true essence of progress in business adminis- tration, of eflSciency in production, and efficiency in distri- bution, comes from a knowledge of the relation of business to tlie government of the state, and of the city, aud of the nation, of relating the affairs of one's daily life in mill, or in shop, or in the store, to the broader things that have to do with public concern; to find the relationship that exists between legislation and business, and to help those who have to do witli our legislation by the counsel and the wise advice of those who have to do with the actual production of our fommoditios, and tlioir distribution ; the broader out- ]of)k rather than tliat solely from the selfish point of view of cIVK'iency in administrative methods, or in production, solely for the sake of being able to gatlier a few more dol- lars at the end of the year. These chambers of commerce PUBLIC CONCERN IN BUSINESS ADMINISTRATION 15 have for their purpo.se the broader development of the business men, with respect to all things that relate to effi- ciency of production and distribution; and, carrying out that idea, men usually have a broad vision and see beyond the lines of their own particular concerns into the concerns that are of the nation, and in so doing they not only be- come better producers and better citizens, but they have the broader sympathy wliich will lead them into a kindlier relationship with others and a more cordial consideration for legislators, and in the end to better economic conditions for our entire country. I bring these views of the question to you for this rea- son: I hope you will discuss in this college of commerce the necessity for creating a strong force of men who can lead in the movement of which I have spoken. There are thousands of organizations in this country today of busi- ness men. There are many hundreds of them that are effi- cient and enthusiastic in so far as they have leadership, but there is an absolute dearth of men who have been trained to lead in these particular fields of action. There is a profession awaiting those who have to do with the making of men to fill places of prominence and of power in this country, a profession that is just as real as the law or as medicine. The profession is that of the civic secre- tary, the civic commercial 'secretary, who may pass through the various stages of his own profession from small to large organizations in cities of small size, and then on up through the scale, filling places that are as important as any office or any place that a man can be called to fill in this country. This school, joined with others of like character in this country, should, in my judgment, seek to establish a course that shall prepare the men who go through this college and througli this School of Commerce, to take the places that are so freely opened and to fill the places that are so badly in need of being filled today. In the work of the Chamber of Commerce with which I am connected there is not a single week passes that we do not have applications from organizations all over this 16 COMMERCIAL EDUCATION AND BUSINESS PROGRESS country asking if we can indicate to them men who are trained in this particular work, men who can occupy a place not only close to the municipal government of their city, but close to its industrial development, men who will stand in the community as high as any citizen, the impor- tance of whose work cannot be over-estimated in the devel- opment of the community. There is no more honorable profession ; there is none more sadly needed at the present time. The graduate school of business administration in Harvard is at the present time seriously taking up this question. Northwestern University has been discussing it. Other universities will take it up from time to time, and after all there is where the need lies today. EflQciency that shall be broad enough not only to cover the selfish need, but the unselfish needs of the great public concerns of this country, that shall teach the business men that efliciency has to do not only with the better production of his particu- lar product, or of the making of a cheaper product, but that will make for better conditions in his city, and education of the people under his jurisdiction. If this School of Commerce will undertake to lay down a course that shall contain municipal government and ad- ministration — for efficiency there is as greatly needed as in tlie manufacturing plant — that shall undertake to study state government and efficiency in the disposition of state funds ; that shall undertake to do what Mr. Cleveland has done so well in Washington in national efficiency and the national budget; down through all the questions that have to do with commerce and with the general civic conditions of our country, and you will find that there are studies wliicli can be jjrepared, subjects which can be taught, that will train men for positions that will be more lucrative than other ])rofossi(ms now are. Men so trained can render not only a service to tliemselves but a gi'eat patriotic serv- ice to their country as a result of the years of study wliich they may give to these subjects, transportation and Kubjects of like character, in addition to the subjects which PUBLIC CONCERN IN BUSINESS ADMINISTRATION 17 students would naturally take, such as accountancy, etc. Now my ambition in this matter is that there should be created as a result of the upbuilding of these schools of commerce within the large universities of our country, a corps of young men who are willing to train themselves for this important service, who are willing to study deeply the problems of our day — and they are serious economic prob- lems that now confront us, perhaps more serious to our business and commercial interests than have confronted those interests in any previous time — who will carefully prepare themselves for those places and fill them, and ren- der a patriotic service to country while doing this, doing great things for themselves, for no more creditable place can be found than that of leadership in organizations that are meant for building up the civic, commercial, and indus- trial interests of the community. Some Business Tendencies of the Day S. T. Henry Western Manager of the Engineering Record Many tendencies of a decade ago towards new meth- ods in tlie business world are today recognized fundamen- tals of business success. The combination of scattered competing industries, the standardization of i^roduction and the complete utilization of by-products have had devel- opment in this country only during the last fifteen to twenty years. The tremendous value of thorough studies of efficiency promotion in all branches of business are not even yet fully appreciated. Other business tendencies of at least as great importance as any that have been mentioned are now working to the front. Close co-operation between the manufacturer and the consumer, generally termed service, is one of the strongest of these tendencies under- lying present-day business. Many a manufacturer has in the past given what is now called service to the consumer without appreciating fully just what he was doing. The efficiency of many a factory likewise has long been high, simply on account of the wonderful natural ability of some individual or indi- viduals responsible for tlie organization of that factory. But today conditions governing the efficiency of a factory may be determined and analyzed with utmost certainty. The manner in which service work may be developed by tlie manufacturer's sales department is subject to as close analysis as is any established business method. Indeed, many an aggressive producing organization already has its service policy as tlioroughly established as are its credit methods. The undeveloped possibilities of such service sales work are so vast, however, and so much remains to be done in determining the manner in which service work can best be undertaken in many industries, that this work may truthfully still be called a tendency of our business niefliods. But it is a tendency that force of competitive circiinistances will mold into most concrete form in the very near future. 18 PRESENT BUSINESS TENDENCIES 19 Service to tlie consumer generally first requires a study of the conditions of tlie industry in whicli a manufacturer's products are used. Continual development of products to keep pace with the changing needs of an industry is the next step. And finally, the producer must so thoroughly demonstrate to the consumer how to adapt his products to the consumer's conditions that satisfaction is assured. The success of such a service method of selling has been proved so conclusively, that in many fields competitors realize that no other methods of selling can meet it. The ramifications of the service-to-the-consumer sales method are extremely wide. Mr. McAdoo demonstrated one extreme of it in a remarkable way in his operation of the Hudson tunnels connecting Manhattan with the Jersey shore. He built those tunnels, he equipped them, and he operated his trains to meet the demands of the traveling public. As conditions changed, he changed to meet them. Not a protest was made when his company, because the investment in the tunnels was not earning a fair dividend, increased the fare from five to seven cents for a maximum ride of four miles. But other New York City lines cannot get more than five cents for a twenty-six mile ride. Another concrete example of the success of service to the consumer in selling is the results obtained by a certain large manufacturing organization with electric-railway motors. Several years ago this company began a most ex- haustive study of conditions to be met by the equipment of electrically operated cars for all classes of service. The situation was most thoroughly investigated. The best methods of generating and distributing electrical power for each general situation were selected. The most efiicient design of motor that would meet the extremely exacting conditions was developed. The right way to install these motors was determined. The data on which were based the many conclusions that had to be reached as this work progressed were obtained first-hand in the field by the manufacturer's men. These data came from the managers, the operators, the motormen, the repairmen, and in fact, 20 COMMERCIAL EDUCATION AND BUSINESS PROGRESS from all electric-railway employees who could furnish a single element by which efficiency of the car motor equip- ment could be increased. Engineering features naturally controlled very largely. But financial, operating, and maintenance ideas had to be given equal weight in devel- oping many details. The work of this company on electric-railway motor improvement extended over several years. Advances were made slowly. But always the consumer understood that the wliole effort of the campaign was to give him the best electric-railway equipment that could be built. The men of the manufacturing organization who made these studies had to be far more than ordinary salesmen. And they soon became recognized experts in their field. Consequently, the position occupied today by this company and its elec- tric-railway motor salesmen is such that the company scarcely recognizes any competition. This enviable posi- tion was built on service to the consumer. Another example may help indicate the certainty of results from service work in sales. A contract for one of the large dry docks built by the federal government was awarded some years ago. The contractor failed on the job. A second and then a third contractor were unable to handle the construction work. The contract finally was awarded a fourth time. The first three contractors em- ployed material-handling equipment generally used on otlier similar work. A salesman of a large manufacturing concern made a thorough study of the reasons why the first three coiitractorK had failed. He and other men of his organization studied the situation from every point of view. They gave full recognition to the labor, financial, and Tiianagement conditions, and to the rigid government s[)('(ili('ations, as well as to the physical situation involved. Tliey demonstrated conclusively that tlie equipment used had been tlie jn-iiiiary cause of tlie previous failures. Then, based on their investigations, they developed a better metliod of handling the work with equipment built by their company. After this idea was worked out in complete de- PRESENT BUSINESS TENDENCIES 21 tail, it was presented to the fourth contractor. He imme- diately saw the value of the suggestion and gave the com- pany an order for over $100,000 worth of its equipment. He had been sold an idea. It was service to the consumer which secured that business without competition. And service of a similar sort continued since then has procured for this company nearly $400,000 worth of business from this single customer. The work of the association of manufacturers in vari- ous allied industries is an illustration of a combined effort to give service to the consumer. An effort thus induced must, in most cases, be continued by the individual manu- facturer with his own customers. The investigations made by the association of the paving brick manufacturers of this country show what can be done in this direction. To the layman there appeared to be little opportunity for changing materially the manner in which brick pavements formerly were laid. But years of investigation of the be- havior of brick pavements were conducted by this associa- tion, in conjunction with engineers who designed and con- tractors who laid such pavements. These investigations went into the most minute details. As a result of them, it is now practicable to build a brick pavement that will give many times more years of service than did brick pavements constructed in the old way at about the same cost. The manufacturers of paving-brick have thus expanded their field tremendously simply by service to the consumer. And today, nearly every paving-brick manufacturer in the United States is oversold. The examples of service which have been mentioned refer largely to work done by manufacturers of mechanical equipment and technical products. The manner in which this same service idea is being carried out by manufactur- ers and distributers in every line of industry could, how- ever, readily be shown. In the class journal publishing field, with which I am particularly familiar, this service idea has become an accepted part of the business. The pub- lications which are not in a position to offer it are going 22 COMMERCIAL EDUCATION AND BUSINESS PROGRESS backwards. Those which have developed it most com- pletely are making the largest success. And so it will most certainly be ere long in most lines of industry. One immediately noticeable feature of this modern method of selling has been the demand it creates for trained men af large natural ability. The salesman of the old school fortunately is passing. Men who sell machinery and equipment particularly have felt the need for a broader knowledge of their field. This need is growing at a remark- able rate as the service method of selling becomes more common. Sales managers in other lines of industry have sensed the potentiality of properly trained men in their selling organizations; men who can study the needs of their field; men who can assist in the development of products to anticipate these needs; and who can accompany and follow sales with expert advice on how products can be used most efficiently. A very casual study of the list of men who have gone forth from the Engineering School of the University of Illinois since 1900 shows a surprisingly large number in sales work. The same holds true for the alumni of other technical institutions. The reason is very easy to find. The manufacturer of products more or less technical who uses service-selling metliods finds he must train very much longer a salesman with a purely academic education than he must a man whose education has been along the purely technical side. Young engineers are by no means properly trained for such sales work. But as a class, they have proved beyond question to be the best trained men avail- able for quick development in service-sales methods. The great need of progressive manufacturers and distributers generally is for men trained to develop rapidly in their ser- vice sales departments. This need for trained men in selling work offers oppor- tunities beyond the immediate appreciation of those not fully conversant with the situation. The selling end of any producing or distributing organization is the end which pjiys tlie best salaries. And it is the most direct route to PRESENT BUSINESS TENDENCIES 23 the executive positions and to financial control. With the rapid growth of service-selling methods that is at hand, this opportunity for the properly trained young man is most promising. How men are best to be trained for specialized service sales work remains to be proved. The situation is quite comparable to one which existed in the engineering profes- sion only twelve to fifteen years ago. About that time, there began the now strong demand for better public water supplies, better waste disposal, better housing, and better sanitation generally. There were no men specially trained to design, install and operate tlie vast works required. On the one hand was the engineer with his knowledge of mate- rials and mechanics; on the other hand, the chemist and biologist with their knowledge of the natural processes involved in the purification of water, the disposal of sew- age and the like. Keen minds in many engineering schools saw the demand for men with a training that embraced engineering, biology, and chemistry as applied to sanitation. As a result, we have now^ sanitary engineering as a fully recognized branch of the engineering profession. And in tliis brancli the details of engineering, biology, and chem- istry involved have unquestionably been advanced more rapidly than would have been the case if sanitary engineer- ing courses liad not been established. Furthermore, sani- tary engineers are receiving continually better salaries and are in greater demand than are engineers of any other training. In some similar manner the departments housed by the building w'e are to dedicate tomorrow will meet the need of properly trained men for service-sales work. Tliis recently developed need, of such large opportunity to the men who will be fitted by tliese departments to take advan- tage of it, is merely one of the many tendencies in our mod- ern methods of doing business. These trained men will have a chance through such tendencies to work with as much imagination, with as much enthusiasm, and with as much satisfaction as any artist ever enjoyed. The Business Problems of Agriculture Chas. a. Ewing When I received the program arranged for this occa- sion, and saw the names and number of distinguished and scholarly men who were to address you, I felt embarrassed. You will not, I am sure, think me so presumptuous as to lay claim to any part of your attention for myself. I am content to remain obscure that you may devote your undi- vided attention to my subject; for it, I have no apologies to offer; it needs none. In its importance agriculture stands easily first. With its welfare our own, whether as private individuals, or as a commonwealth, is indissolubly linked. We are here today to mark a new epoch in its de- velopment, and can rejoice in common over its progress. The man with the hoe has cut a wide swath of recent years. He has been industriously working in many differ- ent fields, turning over much that is new and interesting. You will not be surprised to see him looking over the pal- ings at this new field of endeavor, trying to find a gap in the fence, and wondering how it had escaped his notice so long. It is less tlian a dozen years since the late Honorable L. H. Kerrick here dedicated to the master science of agri- culture one of the largest buildings in the world ever de- voted to that work. Only nineteen students were at that time enrolled in the agricultural course. Tliink of the vision of tlie men to wliom it appeared wise to commence on such a scale, and their faith in its justification! Who would Imve believed then, that in the brief span of a decade that great l)uil(ling would be full and overflowing, wholly iiuuhMjuale to accommodate the students crowding through its doors; yet such is the case. Not by any moans the least of the agricultural prob- lems of the last, and of the next ten years, has been, and will be, affording the opportunity to all seeking instruc- 24 BUSINESS PROBLEMS OF AGRICULTURE 25 tion along these lines; where to find the teachers and pro- fessors, and where to get accommodations and equipment for their work. Our turning from this Art of Arts to this Science of Sciences has been the educational phenomenon of our his- tory. The discovery of this young giant slumbering quietly in our midst affected us a good deal as did Gulliver the Lilliputians. We set about capturing him with all possible haste, and making him fast before he awakened. Teachers, writers, and editors combined their forces and trained their batteries on him. Special trains were pressed into service to carry news from the front. So it still goes on. The progress made has been as remarkable as the work itself. All that has been learned about soil and fertility, crops and tillage, the breeding and feeding of our domestic animals, has added wonderfully to our store of knowledge, and it is a source of just pride that our own state institu- tion has been in the forefront of the contributors. All this you say may be true; even so, why mention it on this occasion? it you will refer to the booklet in re- gard to this building you will notice on the cover it says : "University of Illinois, Commerce Building, devoted to the study of Economics, Commerce, Public and Private Finance, Railway Administration, Money and Banking, Business Organization and Management, Accountancy, Insurance, Statistics"; then there follows a row of little dots. They confuse some who do not know what they mean, but to those who are familiar with this institution, the con- tents of its charter and intention of its founders, the mean- ing is clear. They refer to the foregoing subjects, and should be translated thus: "in their relation to agricul- ture." It would have been better to print that instead of dotting it, as it has been intimated that agriculture did not belong in this department; that these other subjects needed the space; but that a corner might be found, provided it would come in quietly and create as little disturbance as possible. This reminds one of the story of the Arab who let the camel put just its nose inside his tent ; and you all 26 COMMEKCIAL EDUCATION AND BUSINESS PROGRESS remember how it ended. The development of the business side of agriculture will be commensurate with its scientific development, and in ten years — yes, in five, this building will not accommodate you all. It is agriculture that affords the largest field of op- portunity to all these subjects. Studied in their relation to it, let us hope that Economics will help us eliminate the great waste of time, labor, equipment, and produce which now occurs on our farms; that Commerce will aid us in solving the perplexing question of distribution, so that the farmer may receive a fairer share of the consum- er's dollar, and still let the consumer's dollar buy more of what the farmer has to sell; that Finance will discover a way to overcome the fluctuation in value of from thirty to one hundred per cent of the great staple crops of corn and cattle, wheat and oats, which now occurs in a few months' time — usually the lower figure when the producer parts with it, and the higher before passing into the hands of the consumer; that Railway Administration will find how to relieve us from the car shortage "\j''hich now seems to be coincident with the harvesting and moving of a crop. The time will come when the development of our waterways will be fostered by our railways. They will be glad to turn over to them, so far as possible, the big bulky freights, and devote their equipment more largely to the rapid, higher- priced freights — a benefit to all parties concerned. No less an authority than James J. Hill is quoted as saying: "For the expense of moving one ton of bulk freight one mile on wlic'ols he could move it twenty-six miles on water; and equipped with proper terminal facilities, a boat would beat a box car to death !" In addition, this development would minimize our enormous annual loss from floods, and create a vjist niintiint of j)ower. Let us liope tliat Money and Hank- ing will be able to extend credit to farmers on more reason- able rate of interest than tliey enjoy at present, as is done in other countries; that Business Organization and Man- agement may get out into the country and revolutionize tlie |>r('sent methods of doing business, introducing the BUSINESS PROBLEMS OB^ AGRICULTURE 27 benefits of co-operation and teaching the value of the finished product over the raw material, and how to market it to better advantage. Everything that touches our lives, every enterprise in which we engage, whether we live in town or in the coun- try, sooner or later goes back to the industry which sus- tains us. The one petition common to us all, rich and poor alike, is the one standing first in our Lord's Prayer : "Give us this day our daily bread"; this one is fundamental to all the rest ; on it they depend ; about it they revolve. We see everywhere about us the successful business of today studying its operations to render them more efficient. It must do so to survive. The degree to which it solves these questions largely determines the measure of its suc- cess. This is what will be done here. The various enter- prises which are the subjects of investigation are studied to the end that people may engage in them with less dan- ger of mistakes or failures; that they may be more pru- dently and efficiently conducted. We all commend the wisdom of providing a place such as this, where the laws of commerce, finance, economics, and business methods can be studied and applied to various great enterprises such as railways and banking, in which we are all interested. Far better learn about them here than in the old expensive school of experience. We have more railway mileage than any other state in the Union, but one, and the development of all these rail- ways has much to do with the leading position we occupy. They affect directly the public safety, comfort, and business throughout the state, and we look to their officers, those men having control of their administration, for their safe and successful operation. So with banks, modern business is impossible without them. They extend the boundaries of our operations enor- mously and open up avenues of trade which would other- wise remain closed. They operate so smoothly and quietly that we take them for granted, and seldom consider how great is the service thev render. 28 COMMERCIAL EDUCATION AND BUSINESS PROGRESS Other enterprises there are as worthy of mention and investigation in a department of this kind as railways and banks, but like them are already highly organized as com- pared with agriculture; for greatly as we have increased our skill in its art, and much as we have added to our knowledge of its science, we have till now largely neglected the development of its business side. If these already highly organized enterprises are in need of such a building as this, how great must be the need of agriculture? Not for the sake of an invidious comparison, but that we may the better judge these relative needs and more fully realize the scope and importance of this work, permit me to call your attention to the following: Illinois has about two thousand banks; the last report of the Interstate Com- merce Commission estimates that we have less than one thousand railway officials; while according to our Depart- ment of Agriculture, Illinois has over two hundred and fifty thousand farms. The farmer on each one has charge of its administra- tion. He is more responsible for its management than the railway officer is for the management of the railway, or the bank director for the bank. Each farm has its advan- tages and disadvantages, particular type of soil, and fitness for this or that branch of farming. Each is a factory, if you please, engaged in transforming the sunsliine and rain and elements of the soil into the loaf for tomorrow. Each one is subject to classification and organization according to business methods and economic farm management, and each is ripe for investigation by sucli a department as tliis. Imagine if you cfin a railway, a bank, or a factory, trying to conduct its business without a set of books, with- out an inventory or yearly balance, without figuring profit and loss. Yet tliis great complex business of agriculture knows but little of these things; it is trying to get along without them. Hut few of those two hundred and fifty thousand far- mers know what their overhead charge amounts to, or the per cent of dividend their investment is paying them. Pay- BUSINESS PROBLEMS OP AGRICULTURE 29 ing satisfactory dividends is a problem which has not been simi)lified by a tremendous rise in land values and labor costs. But few figure the value of their own time and labor, or the cost of their equipment and its maintenance, the expense of keeping a team of horses, or the amount of labor they do in a year; and the great problems of buying and selling are practicality untouched; so on ad infinitum. The American farmer has had a tremendous task on his hands, and has won for himself the distinction of being the most productive man in the world per capita. He has had no opportunity for studying these things before, and therefore could not be expected to know them; but they demand his attention now. Pressing as is the need of this work we have not heretofore been ready to take up the sub- jects of Agricultural Economics and Farm Management ; first, because we did not know enough about them. The very data which our experiment stations and colleges have been gathering in regard to the science of agriculture must necessarily come first, for of such is the foundation on which they rest; second, the realization of their need has not been sufficiently general. The prevailing opinion seems to be that the young man coming over here to take a course in the science of agri- culture will naturally acquire all the information he needs concerning farm management, and should be able without further instruction to select for his own use that informa- tion best adapted to his needs. Such a plan is not wise; that this may more fully appear let us consider the matter a little further. In its beginnings agriculture was as simple as the primitive men who practiced it; nothing could be more so. In its higher development nothing could bo more complex. Like a great body attracting those smaller about it, so agriculture draws unto itself the various sciences, and ren- ders them subservient to its purposes. Enter any depart- ment in the college — soil, agronom3\ horticulture, or any other you may choose (there are quite a number of them now and they will continue to increase) — they will trans- 30 COMMERCIAL EDUCATION AND BUSINESS PROGRESS port you to the outer confines of knowledge on that particu- lar subject; for that is their specialty, and in the very na- ture of things they become specialists and see each and every farm problem through their particular shade of spec- tacles. To that extent they lose their perspective of the whole. Investigators at our experiment stations patiently carry on their search, the results of which are disseminated in the class room. The amount and diversity of this infor- mation is astonishing. You surely would not expect the young student to catalogue and arrange all this for him- self. The State of Illinois has invested freely in agricultural education and has never found a better investment ; but if it is to reap the full measure of its reward, the information we have acquired must be made to flow back from our college and experiment stations through the channels of agricultural economics and business management, into practical operation on the farms. The place to begin is here. Start now, and it will take a generation to get it on the farms; for this is new wine and new wine must have new bottles. We all think too much of the old bottles in this case to want to risk bursting them ; and besides, many of their stoppers are in pretty tight when you approach them on these subjects. There is need, great need, of a department wherein the many facts and figures of the different branches of agriculture can be brought together, combined and put into operation to the best advantage. Certain of them have strong natural afifinities and are best adapted to particular conditions, just as every farm lias peculiarities of topogra- phy, fertility, and accessibility to market. The questions pertaining to these subjects are without number. Every new invention or discovery affects them. This department is destined to become one into which all the fruits from the cornucopias of the others are emptied, sorted out and packed ready for distribution. Every student of agriculture will deem it essential to his course. I do not expect it to solve every problem he will BUSINESS PROBLEMS OF AGRICULTURE 31 encounter when he gets back on the farm, but it will teach him to keep a record, to strike a balance, to take an inven- tory, to look for waste, to figure profit and loss, and thus to solve his own problems when he meets them. He will choose more wisely what he devotes himself and his farm to producing. It will make him more efficient and his farm more productive. The last census shows an increase of twenty per cent in our population, and no increase to speak of in our farms. We are feeding this increase almost entirely out of the surplus which we formerly had for export. The present decade will see our transition from an exporter to an im- porter of foodstuffs — we, who only yesterday, were the granary of the world. It is hard to believe. Within the last few days you have seen the tariff com- ing off our agricultural products in an effort to reduce the cost of living. So long as we had a big surplus this tariff reminded me of a tax on coals brought to Newcastle. It has this to recommend it, however ; if it has not afforded us protection we will not miss it when it is gone. As our surplus disappears the farmer will be placed in competition with the cheap land and cheaper labor of other countries. These are some of the facts bearing on our present agricul- tural situation. There was a time, and not long ago, when a man could be a failure on the farm from a business standpoint, and yet continue in business. He could farm so as to deplete the fertility of his soil and then move to a fresh farm. There was always new land to bring under the plow, and this took away the fear of competition. Land was so abundant and cheap that people were spoken of as being "land poor." This was a common complaint, but these days are passed and gone. Our farms are now occupied. Land is no longer cheap. Competition is sharpening its spurs for the farmer and he must hence forth stand up and be measured by the rule of modern business efficiency. He must be able to cope with these changed conditions; if he falls short he will have to give way to some one more capable. No matter who farms it the land will 32 COMMERCIAL EDUCATION AND BUSINESS PROGRESS belong to the man who can manage it profitably. Therein lies a danger of his being exploited as farmers have been in some countries, even in the southern part of our own country; if not exploited, he must descend from owner to tenant, or from tenant to hired man. In the face of these conditions it vrould be well to profit by the experience of those older agricultural coun- tries. From the French w^e can learn a great lesson in economy ; from the Germans, intensive methods and rural credits; from the Scotch, thrift; from the Danes, the value of co-operation ; from them all, much about marketing. But in some of these countries the acre, so to speak, has become the standard; in our own may it ever remain the man! For man does not live by bread alone, and with no country I have ever seen would I exchange our standard and ideals of rural life. To preserve these and afford the opportunity for their continued development and elevation is our chief concern. All other agricultural problems are of minor importance. Accomplish this, and you accomplish all ; for whether or not the answers to the questions which now per- plex us are difficult, depends most largely and directly upon the kind of men who undertake to solve them. Show me a community where the problems of the country church, the country school, or country road have become acute, and I will show you a community where the short-term tenant farmer predominates, and which is largely made up of agricultural "stand-patters" instead of "progressives." The best farm community exists where the men who own the farms live on and operate tliem. There you find the sort of farm homes tliat constitute the backbone of our country. They are the cradle of its best citizonsliip. There is something about tlieir environment tliat gives tlicm a higli educational value, and develops habits of industry, economy, patience, and perseverance — traits of rliaracter which are inestimable. It is this life we would preserve in its highest and best. We are now lifting the latch on the door to its new oppor- tunity. Tlie way lies here. SECOND SESSION BUSINESS ADMINISTRATION IN ITS RELATION TO PUBLIC AND PRIVATE WELFARE What a Budget May Mean to the Administration Frederick A. Cleveland Chairman of the Commission on Economy and Efficiency Before going into this subject I wish to emphasize the fact that the budget, as the term is understood where real budgets are used is essentially an executive document, and as such is to be clearly distinguished from an act of appro- priation. It is to the Government what the annual report of a president of a board is to a private corporation. The hudget an executive document. — The primary pur- pose of a budget is to provide a means whereby the officers who are in everyday contact with the business may give information to other officers who do not have everyday contact, but who meet periodically as a body for the pur- pose of considering and deciding questions of policy. In government it is the evolutionary product of a democratic regime which has insisted on : Accountability for funds granted, and a declaration of purpose before further grants are made. — In other words, it is a statement and declaration by means of which respon- sibility for infidelity, inefficiency, and waste may be located. Responsibility is to the electorate. Accountability is to be enforced through critical review by the legislature. The declaration of purpose must be made to a group of repre- sentatives of the people who hold the purse strings. Re- sponsibility to the electorate can be protected and en- forced only through knowledge of facts, and the Executive is called upon to furnish them. Knowledge of facts can be obtained by the Executive only through records and re- ports, and for liis own protection he must know that these are complete, accurate, and up-to-date. It is essential to a declaration of purpose that plans must be made and esti- mates of cost must be submitted. Through a budget the Executive may also be made responsible for recommending how revenues are to be raised. In any event, he must 35 36 COMMERCIAL EDUCATION AND BUSINESS PROGRESS determine that his plans fall within the range of possibility of accomplishment. All of these processes or steps are incidental or collateral to the preparation and submission of a budget. Collateral steps to a budget procedure. — In this coun- try we have had all of the incidental or collateral steps to a budget procedure, but we have never had a budget, i. e., in the sense that the term is used abroad. We have never had a definite statement of affairs and a definite statement of executive proposals submitted by the responsible head of the administration in budget form. Each of the collateral processes or steps has at one time or another, or in one place or another, been called a "budget." Departmental summaries of estimates prepared by some irresponsible administrative officer or board ; bills of appropriation pre- pared by committees of the legislative branch ; acts of ap- propriation by the legislative branch, unassociated with revenue measures ; revenue measures combined with acts of appropriation — these are among the collateral steps of a budget procedure, each of which in this country has been given the name of "budget." From all of these procedures, however, the real and only effective means that has ever been devised by democracy for locating and enforcing re- sponsibility — the budget itself — has been lacking. Our Government irre^ponsihle. — And so in this coun- try we have not had responsible government. We have tried all the methods that have been worked out in coun- tries where a budget practice obtains except tlie budget itself. In our effort to locate and enforce responsibility we have provided for the separation of governing powers ; for the centralization of executive power in a single elec- tive officer; for the centralization of executive power by making practically every head of department elective; for the consolidation of both legislative and executive powers that theretofore had been separated; for the utilization of agencies outside and independent of both of these and in 8ome instances outside of the Government itself — we have done everything to locate and enforce responsibility except MEANING OF A BUDGET TO THE ADMINISTRATION 37 to adopt the very simple and practical expedient of requir- ing that the legally responsible head of the administration shall submit each year a statement which shall be used by the legislative branch as a means whereby the administra- tion may be actually held responsible for rendering a satis- factory account and for judgment in the preparation and submission of plans for future expenditure — a basis for considering whether or not the Executive is entitled to confidence and further deserves the support which is asked for by him. Constitutional prescriptions violated. — In this rela- tion it may be helpful to reflect a moment on the fact that the reason for the absence of the budget system in this country is not to be found in our fundamental law. Each of the elements essential to a budget has been definitely provided for in the Constitution of the United States. Taken together, the mandatory provisions of the Constitu- tion on the subject will almost in exact words define a budget. The Constitution prescribes the means for enforc- ing accountability by requiring that "a regular statement and account of receipts and expenditures of all public money shall be published from time to time" ; it prescribes the means whereby responsibility for judgment in executive planning may be enforced, by requiring that the President "shall from time to time give to Congress information on the state of the Union and recommend to their considera- tion such measures as he shall deem necessary and expedi- ent." Lest the powers of the President to obtain the infor- mation needed might be impaired, the Constitution gives to him the power to "require the opinion in writing of each executive officer in each of the executive departments re- lating to the duties of their respective offices." Thus responsibility for the preparation and submission of a bud- get is definitely located, and the Chief Executive is given the power by means of which he can enforce this upon his subordinates. The power of the President as the responsi- ble head of the administration, to obtain the information necessary, is placed beyond the control of Congress, as is 65232 38 COMMERCIAL EDUCATION AND BUSINESS PROGRESS also his duty to submit to the Congress and the country- such information with such recommendations as by him may be thought "necessary and expedient." He has been given all the powers of a Prime Minister; he has the powers of a real Chief Executive instead of a nominal one, both in administration and in budget making. And the first acts of Congress, following the British precedent, evidently contemplated that we would have in this country a budget which would be prepared and submitted by the executive branch. Notwithstanding this fact, a budget was never prepared and submitted until the last days of the last session of Congress and then as a belated product of a retiring Executive. Why we have not had a budget. — Why have we not had a budget? There is no charter reason for not following the British precedent. The broad theory of the Constitution of the United States and of the Constitution of Great Britain is identical. Both assume that the Government as a corporation holds the properties and administers the public funds as trustee; both assume that the officers of govern- ment are merely agents or public servants, without any rights of their own that are incompatible with service — that they are responsible to the electorate for serving the public with fidelity, for developing efficiency in the organization, and for giving to the people the best possible service at the lowest possible cost. The essential differences between the English and American Constitutions are to be found in two features of organization : 1. In England there is a divided Chief Executive, whereas in tlie United States all executive power is vested in the President. 2. In England the Prime Minister, as the responsible head of tlie adininistrntion, has an indefinite tenure subject to recall by the King or by the House of Commons, while in the United States the President has a fixed tenure, and succession is made to depend on popular vote. 'to* MEANING OP A BUDGET TO THE ADMINISTRATION 39 Our system well adapted to executive leadership. — In these differences, however, no reason is found for not hav- ing a budget. The fact that we have a single executive gives to the President greater power as a leader and, there- fore, greater reason for employing the means necessary to becoming eflScient. In his power of appeal to the people he has been given a great tactical advantage over Mem- bers of Congress. He is the one person regarded as repre- senting the dignity and power of the Nation ; he is the one person who can claim the attention of every man, woman, and child ; when he speaks, the President is heard by every citizen elector. The fact that the President has a fixed tenure still further fortifies him for leadership. Under such circumstances a great constructive leader may under- take measures that he would not dare to propose if he were subject to recall by the legislative branch. If his budget proposals are denied by Congress, then he may carry on a campaign of education and force the members of the lower house and at least one-third of the Senate to stand for re-election before he must again go before the country for electoral support. If during his tenure he can demonstrate that he is right, the country has the advantage of his con- structive effort and will support the policies which he represents. At the same time if he is wrong the constitu- tional barriers against usurpation of power are adequate to prevent the President doing anything for which he can- not obtain a majority following. Reasoning from British analogy. — Those who would argue against the budget as an executive document may urge that the primary reason for a budget in England arose from the difficulty experienced in dealing with a hereditary ruling class — a class which has obtained its status by conquest. This may be admitted. There, a hereditary class having been incorporated into both the legislative and executive branches of tlie Government, the most difficult problem that the Briton had to solve was to provide tlie means for making Government responsive with- out frequent appeal to revolution. The organic method 40 COMMERCIAL EDUCATION AND BUSINESS PROGRESS of solving his problem was to divide the personnel of both branches and enforce responsibility through the non- hereditary or elected official class. The means of enforc- ing responsibility on the hereditary class was to give to the elected personnel of the legislature, who had a limited ten- ure, control over the purse and to make the Prime Minister as the responsible head of the administration subject to recall either by the King or by the House of Commons. But the Briton went one step further. Since the elected personnel of his Government was to be held respon- sible to the people, a procedure was also devised for clearly defining the issues to be discussed. And with this in view the Prime Minister was compelled each year to submit a budget. If the Commons did not controvert the proposals of the Executive, then no issue could be raised until the next parliamentary election. But, if the Commons refused to accept any material part of the Government's program as submitted then the issue would be clear. The result was to develop in Parliament a pro-administration and an oppo- sition party. And since the Executive was without a fixed tenure, if the opposition constituted a majority of the Commons then either the Prime Minister must resign or the King could prorogue the Parliament and force the issue before the country. The budget a procedure for defining 'political issues. — The budget therefore is to the political court of first in- stance (the legislature) and of final appeal (the electorate) what established judicial procedure is to courts of law and equity. That is, a budget is an orderly means whereby issues between contesting parties may be defined, and with reference to which facts may be adduced and arguments made before decision is asked for at the liands of those who are responsible for the expression of public opinion on matters of government. Historic reasons for not hariug budget procedure. — Our reason for not having developed a procedure for clearly defining political issues in this country must be found in historic facts rather than institutional principles. The MEANING OF A BUDGET TO THE ADMINISTRATION 41 first historic fact that confronts us is an assumption on our part that our Constitution is so far different from that of European countries that officers will necessarily be made responsive to public will without a legal procedure by means of which political issues may be defined. We did away with the hereditary class in both branches of the Government, we made our Prime Minister (the President) elective — not by the more popular house of the legisla- ture but by an independent electoral college; we gave to officers of both branches a fixed tenure which would auto- matically return them to the people. This constitutionaf provision was deemed all sufficient. A second historic fact also confronts us, namely, that the dominant attitude toward the Government was that it should be controlled by ideals of laissez faire. Since the Government was to do notliing except to look after matters of diplomacy, provide for national defense, operate a few general utilities such as the post office, and raise revenues, there was no administrative policy at stake. The matters of policy which engaged popular attention had little to do with expenditures. The questions to be settled were those of constitutional interpretation, taxation, the disposition of the public domain and the like. And, so long as laissez faire remained the dominant theory in political discussion. Congress had the advantage. Congress held the purse strings. Since we were without executive leadership, Con- gress came to decide all questions as an incident to mak- ing appropriations. It decided what should be done ; what organization and equipment would be provided; what amount of funds would be voted to the Executive; how many persons could be employed and at what salaries; what could be bought ; matters of promotion and demotion ; con- tractual relations — practically every subject of administra- tive discretion came to be hedged about with legal condi- tions or personal understandings, so that the legislative iniii()n])lace and yet in its higher manifestations rare? Of course, I but travel in a circle if I say that cliaracter is personality, but trite as the truth is, I must stick to it and reiterate it and then go back and do it again. 104 COMMERCIAL EDUCATION AND BUSINESS PROGRESS What the business world expects of you is the having and doing of the virtues that have always made real men. Bring them to us with what you have got from book and laboratory and we will do more than look up and nod when you enter the office for the first time. We will go down to the street door and assure you that we have been holding a place for you. What should you bring? A spirit of subordination; a will to take a humble and hard job — for no great time perhaps — and hold it with cheerfulness and grit; a consciousness of your own shortcomings but with resolute confidence in yourself and courteous appre- ciation of the worth and prowess of fellow-workers who are from the "University of Hard Knocks" ; patience, when misunderstood or underestimated. To adjust yourself to a business you will have to keep everlastingly at it. Work and more work and on top of that more work will be the first requisite. No thought of the clock; no thought for some time of the salary you are paid. Kemember that your employer is as anxious for you to succeed as you are yourself. He will be watching you without talking about it, especially if he is not a col- lege man. I could multiply instances of failure because the college graduate did not have the "sand" to stick. Seventeen-year-old boys may cut rings around you at first, but you should have the feeling that with your college experience you should pass them before long, and you will, provided you combine with your technical training those homely virtues which all truly great and successful men have possessed. One of the functions of a university is to discover talent; in some business organizations departments have been established where talent is discovered by the pro- cess of taking cjiro of the misfits in tlie organization. Men taken from one department where they have failed to make good, have been found to bo successful when clianged to other work. Do not get discouraged. Develop the latent talent that is within you and then "saw wood." Keep your eyes COLLEGE GRADUATE A BUSINESS TYRO 105 open and keep thinking. Your particular job may never have been properly developed. You may correlate certain processes of manufacture in such a way as to save tliou- sands of dollars for your company. In other words, you should be thinking ahead while you are working at your daily task. Gentlemen, I frankly confess that until recently I did not know how extensive and intensive were the plans in our greater institutions of learning for training for business administration. I did not realize that so much is being done to make the graduates of the schools of commerce, business men in fact, call them though you may tyros. I did not realize that the University of Illi- nois had in its enrollment for business courses over two thousand registrations, nor that the University of Penn- sylvania, the University of Chicago, the University of Wisconsin, the University of Michigan, and Harvard Uni- versity were advancing in the broad constructive way, putting these institutions into this new and practical field of service. In reminding you of the pioneer work of the great universities in the development of schools of higher com- mercial education, I do not forget to say, that to that staunch old New England college, Dartmouth, we all owe a debt, in its establishment in 1900 of the first system of post-graduate instruction in business administration, commerce, and finance. No school of its kind antedates the Amos Tuck School of Dartmouth College. With confidence and satisfaction I note the develop- ment of evening extension courses in commerce in various universities, and refer with special pride to the School of Commerce of Northwestern University, founded upon guarantors of prominent members of the Chicago Associa- tion of Commerce, and now planning developments, ex- tending the course of instruction to five years. It is an eye opener to the employer today, to read the final examination papers of your university or from those 106 COMMERCIAL EDUCATION AND BUSINESS PROGRESS of the post-graduate school of Harvard University. I quote from the final examination papers of Harvard on the : Economic Resources and Commercial Organization of Central and South America 1. On the accompanying outline map of South America locate and name the following: a) The mountain systems. b) The four chief river systems. c) The chief trunk lines and international railroads. d) The constituent countries of the continent. i) Their capitals. 2) Their chief cities. 3) The chief port or ports of each. e) The source of the chief exports. 2. a) Name and discuss the various South American periodicals on file at the Business School Reading Room. How would you rank them as to their advertising value for the Ameri- can products and why? b) From your reading what have you gathered as to the place or influence of the following in the development of South America — Balmaceda, the sertao, the gaucho, the "camp," the Gran Chaco, Roca, mate and Ceara. 3. "The population of Western Colombia and of Ecuador, Peru, Chile and Bolivia is approximately 11,000,000, dwelling chiefly along the sea coast. It has been assumed that only this long slope of almost con- tinuous mountain wall from Panama to Patagonia is subject to the direct influence of the canal, and that the barrier of the Andes makes all the rest of the South American Continent dependent on Atlantic outlets. The assumption is presumptuous." "As one result of the Panama Canal a measure of Amazonian com- merce will flow to and from the Pacific." "The world's hunger for crude rubber is a growing one." "The grain fields and pastures of Argentina lie close to the Pacific. The pressure of the agricultural population is westward. A generation — perhaps a decade — will bring it to the slopes of the Andes." (Pepper, Panama to Patagonia, pp. 4-7.) Discuss these excerpts, relative to the Panama Canal, carefully, state- ment by statement. 4. Taking up Argentina and Brazil both as to their products and their exports show how the trade between them and the United States is affected COLLEGE GRADUATE A BUSINESS TYRO 107 and the bearing it has on the United States, east coast shipping, and on the establishment of an American bank. 5. a) Explain succinctly the valorization of coffee. b) A conference was held in Rio de Janeiro in August, 191 1, to consider the valorization of rubber. Discuss its feasibility. c) Discuss similarly the practicability of valorizing nitrate. 6. a) You are an American manufacturer of sewing machines. You have decided to enter the Latin-American market. How shall you proceed and why, bearing in mind the nature of your product, its potential consumption and the location of the market. b) Substituting flour for sewing machines, how would your answer vary? c) And how with shoes? We in Chicago have recently become interested in the building up of trade in South America. We have sent our own representatives to Buenos Aires to open up a sample room and make business connections for us. How we would welcome employees who were able to pass the Har- vard examinations bearing upon the Economic and Com- mercial Organizations of Central and South America! How helpful a man, with such preliminary training, would be as a sales manager in charge of foreign business. Or to quote from the same papers, how fortunate a manufacturer who could pick up a man familiar with industrial organization and able to answer the following: Industrial Organization 1. Prepare a chart for a combination line and staff organization for either a textile mill, a shoe factory, an engineering plant, or a leather plant, giving suitable titles to the various officials. 2. How would you arrange the buildings for a ship-building estab- lishment, including foundry, forge shop, pattern shop, pattern storage, power plant, boiler shop, machine shop, carpenter shop, paint shop, erecting shop, tool shop, storehouse and offices, on a rectangular plot of ground, one end on the harbor, and with a railroad running diagonally across the other end? In such papers, prepared under the eyes of Professor Kinley, a man of Pan-American knowledge and fame, or 108 COMMERCIAL EDUCATION AND BUSINESS PROGRESS proceeding from the Harvard training school for business executives, we find hope that the new type of university man who comes to us for employment may come not so much as a learner but as a teacher. Indeed, I would advise that this School of Administra- tion, unless such practice is already in vogue, issue special advertising advices to employers in large business, inform- ing them what this institution is doing to fit the new man for the new twentieth-century job. It is not enough to send a catalogue when someone requests it. It is not a catalogue that a business man wants. He wants to know what you are selling and he wants the information given to him with the brevity and pungency of a business letter. Then follow up with the goods — with the new business boy. With this impressive growth in mind — a service meeting the requirements of modern business and offering the instrumentality of its expansion and regulation — I desire to lay before you certain interesting thoughts from leaders in Chicago business, the range of their experience embracing most of the courses offered in this great uni- versity. Letter from a Superintendent of Motive Power of a Large Railroad System What are the characteristics of the young man applying for work, who has had some business education at college or university? A college or university is part of a young man's environment, but in speaking of a young man's characteristics, it must be borne in mind that heredity as well as environment is an important factor in the for- mation of these characteristics. Oftentimes, a university is blamed for the lack of qualities which it could never supply. Environment is proba- bly the more powerful factor though and has produced what might be called two classes of college graduates. One class consists of fellows who have worked their way through school, either wholly or partly, and the other class consists of fellows who have been lavishly supplied with money and in many cases are in college so as to be out of the parent's way. Fellows who have had to work hard will be careful, ambitious, considerate of the man who has to earn his living, will have initiative, be able to take hard knocks without becoming discouraged. They will COLLEGE GR.VDUATE A BUSINESS TYRO 109 have a high moral sense and be very clean livers and in general, will choose an occupation to which they are adapted. The other class of men often lose sight during their college career of the serious side of life work and often train for positions to which they are not adapted, having been led astray by a promising financial outlook. These men will not be so well informed on the technicalities of their position and oftentimes have developed tastes which lead them to devote time to pleasure which should be given to studying their job. If put into a position where they come into contact with men whom they consider beneath them, they will lose many valuable points concern- ing detail. However, it is hard to form a general case, and there are many exceptions in either class. Then, too, the advent of the college man into the business world is of such comparatively recent date, that the univer- sities have not had a chance to study the results of their work and strengthen the weak points. How does he excel? The college man will excel one who has not had that advantage in the following ways : His knowledge of fundamentals, such as the sci- ences, mathematics and English, gives him an ability to read intelligently current literature bearing on his position. Especially is this important in the case of a man who is employed in the engineering field. The training a college man gets inclines him to look beyond a minor position he may be filling as a starter. He is more inclined to view his own position as it relates to the organization of the company as a whole. He is also able to solve problems which are out of the ordinary routine. In what does he lack? Perhaps the chief failing of the college man is the restlessness due to the knowledge that he is only filling a subordinate position. He desires promotion too soon and minor positions are not paid so as to enable him to live as he might desire. He often does not realize the full significance of the knowledge the practical man has gained from experience. If he knows his direct superior officer is not a college man, he is inclined to think himself superior, which is sure to start trouble, to say nothing of the many valuable points which may be picked up by experience, and which a superior attitude always loses. // he has moral stamina does he eventually advance the standards and efficiency of your business? Possessing moral stamina, he undoubtedly advances the standards of efficiency because he will not propose anything without a reason, and will prove his results with figures. His training allows no factors to escape which should enter into the solution of a problem. Is he desired as a new employee or are you indifferent to his coming? That a certain percentage of new employees shall be college or tech- nical men is very desirous and instead of being indifferent, we look for them. 110 COMMERCIAL EDUCATION AND BUSINESS PROGRESS Does his academic training need only the technical training of your road to make him the new business man? This question cannot be answered by "yes" or "no" on account of the heredity characteristics of the man. Some men might go to a univer- sity a lifetime and then be a flat business failure. Given equal business ability to start with, the college man will undoubtedly excel the non- college man in business. Is his spirit towards his job right? The answer to this question concerning a college man's attitude to- ward his job is contained in the answers to the previous questions. He will take great interest at first, but interest lags and he becomes dissatis- fied as he comes to a realization of the long, hard path it is to the top. Many subordinate positions have a degree of sameness and monotony connected with them which causes a spirit of unrest. I think, however, that the average college man is very conscientious about his work and has a tendency to give all that is in him. Are the leaders of modern business to be found anywhere else than in the applicants from our schools of commerce, who sincerely and per- sistently seek adjustment with the condition of business? To say the leaders of modern business are to be found only among the graduates of our schools of commerce is against the very institutions of our country. So many factors enter into the proper man for the proper position that merit alone should be the basis for the final judg- ment and all men should have equal opportunities regardless of whether they are graduates of schools of commerce or not. The answers to these questions can only be considered general. It is the experience of one man but the experience of some other may be entirely different, as well as the personal opinions. The problems of mod- ern business are becoming more and more complex, so that for the logical and scientific solution of these problems, reasoning powers are demanded, which can be developed only by a course of training such as a college or university gives. Many problems involve not only a knowledge of busi- ness principles but also a knowledge of economics and even psychology. All these elements can be properly studied only in a school or university, but the student must be made to realize the immense importance of the practical side and not get the idea that when he obtains a diploma he has no more to learn. The business he engages in is in reality a school. He begins at the foot or primer in such business and should go through every department and thus attain a detailed knowledge that will assist materially when he reaches the more important position of manager, etc., in handling the business and forming policies that will make for success. COLLEGE GRADUATE A BUSINESS TYRO 111 From the President of a Railroad It seems to me obvious that one cannot make an absolute statement that college men are better than non-college men, or that the reverse is true. Generalizations are dangerous. I regard college experience as like a little world which gives a man a good many of the same sort of experiences that he will meet in the real or big world. In the colleges that I know most about he will find all sorts and conditions of men, not only in respect to wealth, but also attitude of mind, morality, etc. If a man is weak he is liable to be swept away by temptation ; but it is at least a question whether this man, going into the world without this experience, would have been safe. It is generally conceded that college education means a good deal more today than what is learned out of books. If schools and colleges do not prepare boys and girls for life, they are a failure. To my mind, the most important things that a college can teach are methods of work and ideals. If men are going to be judged simply on the basis of accomplishment, regardless of the methods they employ, I presume one hundred men, taken at random, without a college education, will show up quite as well as one hundred men, taken at random, who have. Any man of experience knows that there are always opportunities to "cut cor- ners" and to reach the goal you are striving for without strictly adhering to the rules of the game. Some men think that if the umpire is not looking it is all right to do this ; and I do not pretend to claim that the college men are wholly above reproach ; but I do believe that as a rule their ethical and moral standards are higher. When it comes to scientific work or technical work of any kind a college man has a tremendous advantage over one who has not had the advantage of a college education. Even if a man knows absolutely noth- ing about the subject he is investigating, but from having absorbed the correct method of undertaking any scientific investigation he goes to work at the new problem to learn the facts, and will not try to form conclu- sions until he has considered all the facts. The method too often fol- lowed by the man who has not had the advantage of training in scientific methods is to select those facts which prove what he desires to show or re-enforce a preconceived notion. With this preface, I will answer your queries : 1. How does he excels If at all, he excels through greater knowledge of life. 2. In what does he lack* I do not think any general statement would fit the case. 3. // he has moral stamina, does he eventually advance the standards and efficiency of your busincssf I think he does. 112 COMMERCIAL EDUCATION AND BUSINESS PROGRESS 4. Is he desired as a new employee, or are you indifferent to /it4 coniingf It is an old saying that "You can't make a silk purse out of a sow's ear." The desirability of a man depends even more on his personality than on the training he has had. 5. Does his academic training need only the technical training of your road to make him the new business man? I would rather have a broadly educated man, unfamiliar with tech- nique of any trade or business, than to have a man who had simply the technique without the foundation. Of course, in some lines (engineering^ for instance) it is absolutely necessary to have the technical knowledge ; but a man who has a technical training without a broad foundation doesn't get very far unless he has sufficient persistence and ambition to educate himself in the great university of life. 6. Is his spirit towards his job right? This depends largely on the character of the man. It is quite the fashion to make jokes about college men being vain or conceited about their knowledge of things, but it is not my experience with them as a class. Of course, individuals may have these faults, and nothing will eradicate them. But school and college is as likely to eradicate this sort of vanity as any experience. 7. Are the leaders of modern business to be found anywhere else than in the applicants from our schools of commerce, who, sincerely and persistently, seek adjustment zvith the conditions of business? I am not sure that I could give an affirmative answer to this leading question, but I believe that the necessity for well-trained men is increas- ing, rather than diminishing. The door will never be closed to the man of unusual ability, persistence, ambition, and grit who gets along in spite of lack of education or who educates himself in spite of inadequate opportunities. Letter from an Accountant 1. Characteristics. He regards theories with too much respect and knows not enough of practical things. Frequently he regards himself as superior to his fellow-workers, who have had no college education, and sometimes seems convinced that he knows more about the business than its managers. 2. How does he excel? In deportment towards customers and visitors, in a quick grasp of explanations made to him, and frequently in being resourceful when there are no precedents to follow. 3. In zvhat does he lack? By all means his greatest lack is practical information concerning business affairs. He also frequently lacks a knowledge of the importance of promptness and of giving attention forthwith to anything which needs such attention. 128 COMMERCIAL EDUCATION AND BUSINESS PROCJRESS 4. A knowledge of the markets at home and abroad and the cus- toms of the trade. 5. To understand foreign tariffs, foreign weights, measures, and moneys and the exchanges. 6. To be acquainted with the technicalities of commercial documents, such as bills of exchange, bills of lading, insurance policies, etc.; and to have some knowledge of commercial law. 7. To know the principles of bookkeeping and accountancy. 8. A knowledge of economics bearing upon commerce; and the use of trade statistics. Tims hastily described is the kind of training needed for leaders in business under the new conditions. The schools of commerce are furnishing it more or less com- pletely, more or less successfully, and young men cannot now get it in the way advocated by the old-fashioned busi- ness man. Doubtless even yet, as we may gather from the report made this morning, many business men think that a minimum of school training is desirable. Many of them still think that the blue overalls and hammer are tlie mark of the engineer rather than the diploma for skill in higher mathematics. Even yet I think there are a few lawyers who believe that the best training for the prospective young lawyer is sweeping out their offices rather than pass- ing the examinations of a law school. For the most part, however, in engineering and law these opinions liave dis- appeared. "So, too, I believe," remarks Mr. Vanderlip, in the address already referred to, "we will in time come to recognize, though perhaps not to so full an extent, that the door to commercial leadership will be through doors of those colleges and universities which have developed courses especially adapted to the requirements of commer- cial life." A complete system of commercial education will pro- vide in the lower schools for the stenography and bookkeep- ing, and all the other kinds of work for which tliero is so widespread a need for routine positions. But for the future leaders of business, we need preparation of a different or at any rate, an additional kind. The courses in commerce in colleges and universities should supplement and be built upon properly organized SCHOOLS OF COMMERCE AND BUSINESS IMPROVEMENT 127 which we have to work, and to secure a knowledge of the customers with whom we are to deal. In the next place, the leader of the business world in many cases must know how to handle men, how to get on with those he does business with. I believe it was Lincoln who made the homely remark that you can catch more flies with molasses than you can with vinegar. We have had a little too much in this country of the notion that business should be promoted by favoritism, yet we cannot have too much of the notion that business success depends upon proper appreciation and treatment of the men with whom one has to do business. Finally, as has been repeatedly remarked, we need in the conduct of our home business truer notions and better standards of the relations of business to public welfare. Now the imparting of knowledge of all these subjects and training in the application of the principles which underlie them are the work which the schools of commerce have set themselves to do. So far as they are successful, their gradu- ates will be enabled to improve business practice, estab- lish higher business ideals, enlarge the volume of industry and trade, broaden their scope, devise new methods, find new markets, win larger personal successes, and make the community more prosperous. So far as these schools suc- ceed in all or any of these respects, they justify their sup- port. What they can do for our domestic trade they can do in large measure to promote tlie expansion of our foreign trade. As illustrating the training needed by a man who is to go into forci(/i) trade as a leader, I (piote the following requirements laid down by an English writer as necessary for tlic r.ritisli merchant doing a foreign trade to conduct his l)usiness j)roperly : 1. An effective knowledge of foreign languages. 2. A knowledge of the modern methods of importing or exporting goods, including freightage and modes of transport. 3. A thorf)ugh knowledge of the goods in which he deals, and of the sciences bearing on his trade. 126 COMMERCIAL EDUCATION AND RTSINESS PROGRESS training we give in them, the more young men we turn out who are capable of enhir^inj; and iTiii)i'(>vin^ husiiK'ss. Technical knowledge, moreover, implies a knowledge of our own resources and how best Id utilize them. The wholesale grocer, or dry-goods man must know something about the sources of growth and the manufacture of the goods he handles if he is to buy in the best markets and get the best products. Indeed, the wholesale grocer and the great dry-goods merchant scour the world now for this very purpose. In the next place, the successful leader in trade must have a knowledge of the principles of organization and administration, and of social and industrial economics. One of the most common remarks in discussions of currency reform in recent years is that the ordinary banker knows no more about the matter than other men; yet the banker, dealing with money matters, would be supposed, according to our older standards, to be the man who should know most about such a subject. But it is one thing to be able to pass upon applications for loans by scrutinizing the conditions of personal credit, and it is quite another thing to be able to grasp the principles that control the banking system as a whole, and its relations to the economic life of the people. Again, in the matter of efficient organization we are woefully lacking. We have heard much of efficiency in industry, but it is the efficiency that comes from the better application of labor. We need it as much if not inorr in the wga)uzntion and a^trntion of business. A more efficient organization is neces.*t for public opinion and the ruthlessness of competition, and the general attitude of business men, 122 COMMERCIAL EDUCATION AND BUSINESS PROGRESS our banking, our sliipping, our finance, and in large meas- ure, prescribe the regulations under which we should do foreign business at all. The training, character, and ideals of our business men of the past generation reflect the conditions that have been described. In some respects they have been the ablest men in the world. The stimulus of great opportunity de- veloped an unequaled native ability in certain respects, which made our business men contemptuous of the slower, more exacting and more careful methods of their foreign brethren. They called for no special training for business life, because no special training was needed to cope with the difficulties they met. No special training is necessary against competitors to fill one's bucket with water at a well whose rim is large enough to give plenty of room to all who liave buckets. These conditions developed a group of men self-reliant, daring, contemptuous of restraint, virile in the pursuit of their own ends, careless of refined methods, and without a proper appreciation of their duties either to the existing public at large, or to coming genera- tions. That is to say, our business methods and policy have been wasteful, crude and, in a waj", harsh. They have wasted the natural resources which are the heritage of the whole people; they have developed too large a contempt for the interests of the public, and too little sense of obli- gation to tlie public, and have not always drawn finely in their business relations distinctions of honesty wliich in personal relations were scrupulously observed. The past generation has seen a rapid change in the situation thus roughly outlined. Less than fifteen years ago the world saw witli astonishment our impetuous inroad into the field of foreign trade. We ourselves felt, as our people had never felt before, tlie stirring impulse of the sense that we were a world power, not ony in a naval, military, and diplomatic way, but in the field of trade. We needed an outlet and we felt ourselves industrially and commercially strong enough to seek it. Within that short period we have awakened to a realizing consciousness of SCHOOLS OF COMMERCE AND BUSINESS IMPROVEMENT 121 could supply all that we ourselves consumed and have a surplus to sell without getting something in return. In other words, we have followed persistently the policy of the development of home industry in manufactures, and have seen with satisfaction the upspringing of industrial activity in almost every line of human effort. Here again, as on the agricultural side, success was comparatively easy. A market of indefinite and growing extent was as- sured in the first instance for pretty nearly everyone who undertook to go into manufacturing or into trade. We did not need to bother ourselves in the early days about seeking an outlet for our surplus manufactured products, for we had none. Our manufacturers and merchants had more than they could do in supplying the markets which a growing population with boundless natural resources furnished them. It is not to be wondered at that under such circum- stances the character of the business developed should hardly accord with conditions that have arisen since; that the standards and ideals of business conduct developed under such a system should be looked on askance in the different regime that prevails today; that men still living who have succeeded under such conditions should not see that their success is not an assurance that others, who lack proper preparation, in the future will succeed equally well, or that the relation of business to the public and the responsibilities of business men to the public welfare should in time become very different. With reference to our foreign trade and its methods under the conditions which have been described as pre- vailing until within the last twenty-five or thirty years, it may be said that we had no foreign trade methods. Re- garding the country as a whole, our position was that of the lucky farmer who had a larger crop than he needed for his own consumption and had sometliiiig to sell to a neighbor, who, without any effort of his, stood at liis door ready to buy. No attention was given to the princi- ples of foreign excliange. We have let the foreigners do 120 COMMERCIAL EDUCATION AND BUSINESS PROGRESS The principal work of the people of the United States during the first century and more of their existence was the conquest of the natural resources of the continent. We have been blessed with abundant resources. We have had and still have a sparce population scattered over an im- mense fertile territory, yielding to a little labor far larger results than the greater efforts of men in older communi- ties could hope to get. Until a short time after the Civil W^ar we were almost exclusively an agricultural country. Our wealth consisted almost exclusively in agricultural products. Comparatively speaking, industry was little de- veloped, and our foreign trade for a country of our extent was negligible. W^e contented ourselves principally with exporting raw materials which were secured abundantly by slight labor. We aimed to be self-sufficing, in the sense that we discouraged attempts to supply our wants from other countries. Then, too, there was plenty of elbow room. Every man could push on to his individual success without crowding his neighbor; the rules of the game of competition, so to speak, it was scarcely necessary to ob- serve. Indeed, many scarcely realized their existence, for there is little danger of fouling in a race in which the track is so broad that the competitors scarcely come into contact with one another. Moreover, there was enough for all. However great the success of one, another was not excluded from securing at least a comfortable livelihood. Under such conditions not only was it not necessary to devote much attention to preventing possible injury of one competitor by another, but it was also unnecessary to lay down rules concerning the relation of individual ef- fort to public welfare. Our economic policy, deliberately adopted, accorded with the conditions described. We set our faces towards the development of home industry. We adopted a system which, as we hoped, protected us against the competition of the people of other countries in lines where we thought ourselves weak, for the purpose, as has been repeatedly said, of supplying all our own wants; as if, forsooth, we Schools of Commerce and Improvement of Business David Kinley Director of the Courses in Business Administration, University of Illinois Some years ago the Honorable Frank A. Vanderlip, formerly Assistant Secretary of the Treasury, now Presi- dent of the National City Bank of New York, made these remarks: "With the limitless wealth of resources which we have had in America, the successful conduct of a busi- ness enterprise has been a comparatively easy matter. Nothing short of egregious error has been likely to lead to failure. Any ordinary mistake in judging conditions or in the application of principles has, as a rule, been obliterated by the rapidity of the country's growth and the extent of its industrial and commercial development. If some of the men who have made notable commercial successes had been forced to face the harder conditions that exist in the old world, the measure of their success might have been very different. Had they been confronted by a situation where population was ])ressing upon the means of subsistence, where all the soil Avas under culti- vation, where the mineral resources were meager, and where there was lacking the wealth of the virgin forests, they would have needed greater abilities and better trained faculties in order to achieve marked success One should not lose siglit of the fact that the lavishness of opportunity has brought commercial success to many wlio liave come into (he field illy prepared and with small ability." TIh'sc statements describe a situalion I lie full impor- tance of VN'liicli few of our business men fully realize. Too many of them are accustomed to depreciate the importance of ediie.'ition for business life on the ground (hat they have gotten on widiout it. As has just been remarked, however, it was comparatively easy to get on without it as things have been. 119 118 COMMERCIAL EDUCATION AND BUSINESS PROGRESS From all these letters from prominent and successful men in different walks of life, you may see that they think the college graduate should have a tremendous advantage over the non-graduate, provided he realizes that certain fundamentals are to be taken into consideration, besides that which may be learned from books. These letters bring out certain traits and these I now summarize. It seems to be the judgment of the business world that among applicants for employment from our colleges there appear the following negative traits of character: 1. Impatience to succeed 2. Lacking in persistence 3. Tendency to snobbishness 4. Lacking in industry 5. Lacking in thrift 6. Lacking in technical training (has more than old college type) 7. Lacking in appreciation of time 8. Easily discouraged Upon the other hand, it is most encouraging to note from these judges of employees that the college graduate has: 1. More concentration 2. Knows where and how to look for information 3. Reasons from one step to another 4. Is more adaptable 5. Is more conscientious 6. Has keener appreciation of the duties of life and its responsibilities 7. Is able to solve more difficult problems 8. Has higher ethical and moral standards 9. Has larger view of life My trial balance would be the new college boy is adaptable to the place he seeks and his problem of adjust- ment is on the way to solution. COLLEGE GRADUATE A BUSINESS TYRO 117 2. Where college graduates have worked their way through college, especially by canvassing during vacation periods, they have taken to the business more readily and get satisfactory returns more quickly. 3. When a college graduate who has had no selling or business experience consults us, we advise him to seek an opening where he will get general business experience and have a chance to learn the ordinary methods of procedure in business life. If a young man would spend from three to five years gaining such experience he will, with the added ma- turity, be much better qualified to make a success in selling insurance. 4. As in everything else the man must be adapted to the business temperamentally and otherwise. In our opinion there are many young men with brains and ability who for temperamental or other reasons are unable to adapt themselves to the requirements of the business. These points together with the general observation that a college man finds it difficult to start where his friends who did not go to college started four years before would seem to cover all that occurs to me at this moment. From the President of a Bank What are the characteristics of the young vian applying for work, who has had some business education at college or university f He is not hurt by such education but is apt to think he knows more than he really does and has something to unlearn usually. How does he excel? By being able to bring a partially trained mind to bear upon the work. In what does he lack? Nothing, except perhaps the experience of having to work for his food and clothing, which a boy of the same age who has not been to college has had. // he has moral stamina, does he eventually advance the standards and efficiency of your business? Yes. Is he desired as a nezu employee or are yoji indifferent to his coming? Very few enter the banking business, and as a rule we do not seek them. Does his academic training need only the technical training of your hank to make him the new business man? No, nothing but actual experience of failure and success make a business man. Is his spirit towards his job right? Yes, in most cases. Are the leaders of modern business to be found anywhere else than in the applicants from our schools of commerce, who sincerely and per- sistently seek adjustment with the conditions of business? Some of them come "from the ranks." 116 COMMERCIAL EDUCATION AND BUSINESS PROGRESS survival of the fittest will carry the college man of right ability far beyond the grammar or high-school graduate, unless the latter is of exceptional mentality. Letter from a Manufacturer I favor the college man in business, for I believe he begins to work with a keener appreciation of the duties of life and its responsibilities and that he enters into his work with a great deal of zeal and enthusiasm in consequence, which must of necessity result in success. The simple fact that a young man has passed through a college or university is evidence in itself that he has ability and application ; that he is not an unknown quantity, for he has already made a record that is recognized. The college boy or man has learned one thing that I feel is all important and that is application. My experience and observation teaches me that the one thing in particular that most boys or young men lack on entering a business life is application, or perhaps it might be better to say concentration on their job, and I firmly believe that a college training is of very material benefit in correcting this. Adjustments Involved on the Part of a College Man in Entering THE Life Insurance Business 1. To try out and true up the application of his training in college to the real problems of life, which involve economic, social, and moral factors. To take the qualifications involved in "making the team" and use them in making a "touch down" in real life against the opposition of ignorance and indifference as they appear in connection with the human problems involved in life insurance service. 2. If the college man has neglected to seriously consider the problem involved in becoming a man, who is to be admitted to society, with all of its privileges and responsibilities, his first big adjustment will be to solve this problem for himself. For one cannot hope to be of service in helping the other fellow solve the problem, if he has not solved his own. 3. To appreciate that success in life, and especially in the business of life insurance, depends upon self -management, plus the proper use of time- as it is valued in real life. Letter from an Insurance Firm I. The average college graduate who has had no previous business or selling experience, is as a rule not adapted to early success as an insurance salesman. Progress is so slow and returns are so small that he does not stay with it. How many would ultimately succeed if they could be carried along it is, of course, impossible to state. COLLEGE GRADUATE A BUSINESS TYRO 115 cause of their having had mental training, they progress much more rapidly than the man who begins with an untrained mind. The opportuni- ties for such young men are many. There never has been a time in the last twenty-five years but what our house alone could take on a score or more of such men and where they have moral stamina, good common sense and are tireless workers and backed by their academic training, their success is assured. Unfortunately, all of the above combinations are seldom found in a man. I think one of the principal difficulties is that the process of develop- ment necessitates the beginning at the bottom and the process is too slow for the average college man. With such impressions it is impossible for one to have the right spirit towards his job. Strange as it may seem, a large per cent of our staff is made up of men who have had little, if any, college experience. The young man with the spur of necessity prodding him and with habits of industry and thrift well established and full of strength of body as well as mind is the natural one to make progress. Letter from a Manufacturer I am in receipt of your letter in regard to the college man in busi- ness. First, he excels in his general knowledge of men and affairs. He lacks the technical training in the industry and for the first six months must necessarily spend all of his time in the acquiring of it. If he is of the right moral stamina and is with Us at the end of six months, he will start to grow and will grow far beyond and in a shorter time than the fellow who comes in with the high-school training. I am speaking now from the distributing end of the business, where in my judgment the college graduate should excel, and also from the standpoint of a superintendent of a manufacturing plant. I do not con- sider it against the college man if at the end of six montlis he does not stay with the industry with which he first attaches himself upon gradua- tion. The botanist Gray defined a weed as a plant out of place. Too many men are weeds in industry, who would become roses if placed in the right rose garden. Too many college graduates accept the first job which is offered, whether they are fitted by nature or talents to the position ; that such men should change after their first six months in an industry, if they or their employers find they would be better somewhere else, in the writer's judgment, should not 1)e charged against the college man. Too many of our generation have forced themselves to fit in square holes, where they would have done better in round ones, had they been in position to make a better choice at the beginning of tlieir business careers. I am a hearty believer in the college man in industry. The natural jealousy on the part of the fellow who starts from the grammar or high school for the college man must always be met with, but the law of the 114 COMMERCIAL EDUCATION AND BUSINESS PROGRESS to grasp details with the result that he was not forced to leave details entirely to the man under him, and while in many instances the modern way of doing business is for the man at the helm to turn details over to his subordinates, still if he has a mind trained for details it is of great benefit to him. This might answer your question "How does he excel?" This, of course, is an isolated case where a man has an opportunity of being placed immediately at the head of a business and probably would not apply to the men you are thinking of. In our own particular line of business we have noted at least fifty to seventy-five men who started at the bottom with us, who are today earning either with us or someone else, salaries of from five to ten thousand a year, and they had no college training. I personally believe the whole matter rests with the individual. We have had a number of young men graduates from college apply for positions, all of whom remained with us a short time only, the difficulty being they are not willing to start at the bottom and work up through the ranks; this is one objection that I have noted in college men. He feels, so to speak, a little above the average fellow and believes it is due him to start at the top, with the result that those whom I have come in contact with are at the age of forty still working in minor positions, because they have jumped from pillar to post in an eflfort to get at the top quickly. This is an answer to your question, "What does he lack?" As to the other questions. I can only repeat that from my personal experience it rests entirely with the individual. We have no objections to employing college men. I only speak with reference to the retail mer- chandise line on State street, and I believe if you will make an investi- gation, you will find that ninety per cent of the department store men who are making from five, ten, and fifteen thousand a year started at the bottom on salaries of from Wve to six dollars a week — or a little higher^ say twelve or fifteen dollars weekly. In every case they have been willing to work along for five or ten years until they have been gradually ad- vanced. I have often remarked upon this condition and wondered why so few of our great department stores are conducted by college men. I refer particularly to department managers, superintendents, and like posi- tions. From a Wholesaler We have comparatively few applications from men who have had some business education at college or university. Occasionally a young man who has graduated from college or university makes application with the idea that he is competent to do almost anything; therefore does not expect to begin at the bottom and work up. Such applicants must of necessity be turned down. Occasionally we find a man having a college education who is ready to take hold as a beginner and is perfectly willing to take his chances on the future. Almost without exception such men make good, and be- COLLEGE GR.AJ)UATE A BUSINESS TYRO 113 4. Does he advance the standards of efficiency? His influence eventually becomes beneficial to the organization of which he is a part. 5. Desirability as a new employee. He is more desirable than one who has not had his training and will more rapidly become expert in the performance of his duties than will an employee who has not had the benefit of college education. 6. Technical training the one need. I should say that he needs more than the mere technical training of the house by which he is engaged to fit him as a business man. He needs to mix with business men and acquire their point of view in matters that are common to all lines of business. 7. Spirit towards his job. The spirit of the college man towards his job is not very diflferent from that of employees who have not had college advantages. He may have a higher conception of the duty he owes to his employer and may be quicker to discriminate where nice questions of conduct and duty are involved. 8. Leaders found in the applicants from schools of commerce. Unquestionably the graduates of schools of commerce eventually become the leaders in the lines with which they affiliate, assuming of course that they have the elementary requirements of perseverance, indus- try, and integrity. I can hardly think of further comment to make which would be of use. If the graduate of the school of commerce can be convinced that the preparation which he has received at college is only partial and does not turn him out a finished product, and that his finishing is to be accom- plished in the business with which he engages, his success will be much quicker and much more pronounced. In the accounting business, we find that graduates of schools of commerce, who seek to enter our line of work, are prone to believe that they have learned from books a very great deal which is only to be acquired by experience. It is true that all they have learned from books is useful, but in this particular line of work experience without book learning is very much more valuable than book learning without experi- ence. Letter from a Large Retailer Inasmuch as I did not attend college, I fear that my answers to the questions submitted would be of no particular benefit to you. I entered business at the age of nineteen and have been actively engaged since that time. My brother, general manager of our business, spent two years at Cornell. We have noticed since he has been with us during the last four years that his academic and technical training have been of particular benefit to him pertaining to details. His mind has been trained' SCHOOLS OF COMMERCE AND BUSINESS IMPROVEMENT 129 and equipped commercial high schools and secondary schools of still lower grade. It is the province of the uni- versity courses to train, if I may say so, the race horses of business life, the leaders — not those whose time is to be absorbed in routine. That this can be done is the belief of a growing number of business men, and is already prac- tically an accepted doctrine in higher educational circles. If our home industry and trade are to expand and improve under the harder conditions that now confront our business men, it can do so only under the leadership of trained men, and, as I remarked a few moments ago, they cannot get their training in the offices or the shops. The apprentice system has passed away. No young man can get an ade- quate idea of the organization of a whole business or its methods in various departments by going into one of these departments. How much banking does a boy learn who goes into a large city bank? He is merely a tooth in a cog of a great machine. The managers and directors and presi- dents of great business concerns have no time to teach boys. For these reasons it has become necessary for the universities to provide the courses of training in commerce similar to those which liave already become well estab- lished in engineering and in law. It is the purpose of these courses to send to the business houses young men without, indeed, the experience of their office boys — and also witli- out their assurance — but with a knowledge of the princi- ples and to some extent of the practices that prevail in their business. They come with a knowledge of the prin- ciples of business organization, of accountancy, of elemen- tary law, of finance, of money and credit, of markets, routes and methods and rates of transportation and com- munication, and other subjects, according to the character of the business they aim to enter. Now it is true that in every calling, be it preaching or banking, a certain amount of what is called practical experience is necessary for tlie highest success. But practical experience, after all, is only the application of known principles to specific condi- 130 COMMERCIAL EDUCATION AND BUSINESS PROGRESS tions. It is foolish to say that the highest success can be attained by the person who tries to make this practical application of known principles to specific conditions with- out knowing the principles to begin with. Such a view may be likened in an extreme way to the claim that the porter of a parlor car could build one because his duties make him familiar with its internal arrangements. It took a Newton to give us great laws of the universe, yet Newton could not add a column of figures correctly. It was Napo- leon who made anew the science of warfare, yet it is ques- tionable whether Napoleon could have fired a cannon and hit the mark. In other words, the great need for business expansion at home and abroad today is leadership of a trained and broad-minded kind ; leadership with organizing ability and wide knowledge. This is true, too, of the lead- ers of divisions and departments as well as of entire busi- ness establishments. The foreign representative of an export house must know his language, must be familiar with the habits and point of view, if you like, the psychol- ogy, of the people he deals with; with their laws, tariffs, ways of doing business, trade routes, and a variety of other things which can be obtained only by preliminary study in the college course. Here, then, is the function of the uni- versity courses of commerce in the improvement and ex- pansion of our trade. It is to furnish courses of study that will train men for the more important positions of leader- ship in every division and branch of trade. But the universities have another duty in training the young men of the coming generation of business men. Wliile giving them the training and knowledge necessary to their personal success as business leaders, and neces- sary to the improvement and expansion of business, the university colleges and schools of commerce must also teach tliein to sot \^) liighci- ethical standards in business. There has been in our business life in the past too much of the thought that everyone should take care of himself, what- ever tlie consequence to his competitors or to the public. SCHOOLS OF COMMERCE AND BUSINESS IMPROVEMENT 131 We need to develop in our young men imagination and the spirit of investigation, the capacity and desire for gen- erous leadership, and a high sense of moral obligation to their fellow business men and to the public at large. It is often said that the ideal of the American business man differs from that of his European competitor in this way. It is the ambition of the American to build the biggest and most powerful business of its kind in the world. He has an ambition, not for the money that is involved, but for the power that that money represents. His European confrere, on the other hand, often says that his ambition is to build a business which will yield him a respectable competence so that he can retire while his mental powers are still unimpaired, and devote himself to a life of culture, leisure, and public service. Doubtless, we need men with botli ideals, but we certainly need more of the latter kind than we have had in the past. It is true that there are leaders in business who care as little about their personal reward as do many men engaged in scientific research. They are devoted to the attainment of certain ideals, com- mercial ideals it is true, yet ideals. Their ambition is to expand and develop business so as to discover new fields of operation, new and better methods, and to perfect an organization or system which will stand as models for tlieir competitors and successors. This is the spirit of the investigator and the public servant. It is no more likely to miss the goal of rendering public service than is that of the man who devotes himself in his laboratory or his study to an investigation which brings no personal reward aside from the distinction of telling the world something new. To put the matter in another way, our university courses in commerce are aiding business by training our young men in what President Hadley has called the sense of trustee- ship in business. The development of this sense of obliga- tion to the public, the acceptance of the ideas that personal success in business is to be best secured by conducting business as a service to the public, and that success which 132 COMMERCIAL EDUCATION AND BUSINESS PROGRESS is achieved by the exploitation of the public is not a worthy success, is one of the most important needs in American life. The university schools of commerce are training young men to this ideal. They are turning out graduates who will not regard a railroad as their private property, but who will know from their study of the fundamental principles of economics and of railway transportation that a railroad is a public belonging in a very important sense, and must be managed in ways that will promote the public welfare as well as the private interests of the men who have invested their capital in it. To teach how to achieve personal business success through service to the public rather than by exploiting the public is the aim of our university schools of commerce; the studies relating to business are their subject-matter ; training in the principles which underlie and constitute these studies and in the application of these principles to practice, is their method. Their result, in the measure of their success, will be better business, bigger business, larger-minded business men, and a more prosperous and better-ordered community life. And thus our schools of commerce are related to business expansion. Presentation of the Commerce Building W. L. Abbott President of the Board of Trustees, University of Illinois It is indeed a far cry from the time when the Univer- sity of Illinois Avas grudgingly given a pittance of twenty thousand dollars a year, to cover all its expenditures, to the time when it is cheerfully given two million dollars for the same purpose, and a like period from the first twenty- five years of its existence, when the total of the state's ap- propriation for buildings amounted to only two hundred and seventy-five thousand dollars, to the present biennium, when the building budget alone amounts to more than twice that sum. To me and to others here who have seen and who have been a part of all of this, the question arises, "What has brought about the change in the sentiment of the people of the State toward the University, and why do they now gladly give a hundred times as much as they formerly be- grudged?" The answer might be that it is because the State is now more wealtliy aud because advanced education is now more popular than formerly. Although these are contributing conditions which the University itself helped to bring about, the prime factor in the University's popu- larity and prosperity undoubtedly is that while it has al- ways maintained high ideals and has been a leader for progress, it has in addition been intensely practical. The people of the State now look to these departments for authoritative information concerning the various prob- lems which arise in their several callings, and the state government is relying more and more upon the University for technical advice and work; but beyond all that it has become generally known that young men and women edu- cated here are able to do well many things that need to be done. This last was not always generally recognized. 133 134 COMMERCIAL EDUCATION AND BUSINESS PROGRESS Who, of the older ones here, has not heard cynical remarks passed concerning the proposition to teach far- mers how to farm, housekeepers how to keep house, and teachers how to teach? All of this opposition and incre- dulity has been met and disarmed by actual demonstra- tion, and now comes the still more startling proposition to develop a business man in college — a School of Commerce for instruction in business theories and methods! The old-time business man, who has achieved a measure of suc- cess through native shrewdness, good luck, and hard knocks looked askance at the proposition to teach to a young man during the short period of a college education the funda- mentals of business, which he himself did or did not learn during a long life of experience. The farmer, the house- wife, the mechanic, the clerk, and the pedagogue, would each entertain similar views regarding his own calling, but with the swift progress of present-day conservation we have discovered mines of wealth everywhere, the farmer in his soil, the mechanic in hi« hands, the teacher in the minds of his pupils, and now b-asiness learns that the more the moods and habits of the seemingly capricious god of commerce are studied and humored, the more he will give from his unlimited resources to those who ask his aid. To me it has always seemed that this School of Com- merce instead of being a branch of the College of Liberal Arts should be transferred to the College of Engineering, and tliere form the major part of a post-graduate course. I have known engineers and engineers in practical af- fairs, and I have noticed that those who command the larg- est salaries are the men who, after liaving done work of the conventional sort in designing, constructing, or oper- ating, are now doing post-graduate work in the executive positions requiring broad knowledge of tlie fundamental priiicijth's wliicli are tauglit in the course of tlie School of Commerce. Tlie greatest strides which have been made in the field of conservation of natural resources have been made PRESENTATION OF COMMERCE BUILDING 135 in those departments which involve the conservation of human effort. The man who studies the underlying princi- ples through which these efforts are put forth and proposes new procedures which will increase the efficiency of that effort is an engineer, and so too is the man who studies the principles of commerce for the purpose of learning and charting its hidden currents, who removes obstructions and straightens the channel that the difference in level between producer and consumer may be reduced, that the toll on business between these two may be abolished, that the cost of the consumer's living may be lowered and the returns to the producer made liigher. The man who does this is also an engineer, and wliile the direct results of his labors are a great blessing to humanity, the indirect re- sults may be even greater, for next to the tie of blood that binds is the tie of profitable business; and when the streams of commerce shall flow strong and unrestricted between nations, peace on earth and good will toward men will become too valuable business assets to be disturbed. The University, in adding department after depart- ment, and in justifying such development has led the peo- ple of the State from one advanced position to another. It was because of such sound leadership in the past that the appropriation for the School of Commerce building was granted at a time when the practical utility of the enterprise was perhaps not clearly recognized by the peo- ple. The obligation now rests upon the University to justify, as it has in the past, the continued liberality of the State, and it is with perfect confidence in the University's ability to "make good" that I now place the School of Commerce building and plant in tlie hands of the President of the University and of tlie faculty of the College of Liberal Arts. University Instruction for Business Men Edmund J. James President of the University of Illinois Those of us who had our college and university train- ing in the middle of the 70's of the last century have seen a marvelous change take place in American higher educa- tion. We are apt to gauge our national achievements and our rate of national progress by the striking signs of material improvement. The growth of our railway system, the increase of our imports and exports, the ever-mounting agricultural product, the equipment of our mines and factories, the erection of sky scrapers — these are the most common means by which we measure the difference between the condition of things today and that of thirty-five or forty years ago. But the change and, as we believe, progress of the American people is no less remarkable in the field of education, elementary, secondary, and higher. The Ameri- can university of today is as different from the institution which passed under that name in the year 1870 as the modern leviathan which drags the twentieth-century train between Chicago and New York is different from the small, in some respects insignificant, locomotive which puffed across our prairies forty years ago. This change has taken place even in our oldest institutions; those which had the longest history behind tliem. Harvard University has changed more in its essential character in the last forty years than it had changed in the preceding two hundred and twenty-five. For tlie Harvard of 1870 was still in essence the college of 1636, with the annex in a more or less loose relation of two or tliree professional schools, which were themselves in turn the mere embryos, so to speak, of the corresponding institutions today. What was true of the change in the oldest and greatest American 136 UNIVERSITY INSTRUCTION FOR BUSINESS MEN 137 university is, of course, still truer of the newer institutions like our own, which were born about the time at which the change began to pass over American higher education. This change has taken place not merely in the institution as a whole but in individual departments of the same. Harvard University medical school is today as different an institution from the Harvard medical school of 1870 as the combined mower, reaper, self-binder, and thresher of the great northwestern wheat fields is different from the rude and ineffective machine which had not yet in 1870 entirely displaced the rude methods of cradling which had prevailed for countless ages in the reaping of wheat. Even the law school of Harvard University today, an institution which serves the purposes of the most conservative and slow-moving profession of all — that of law — is as different from the law school of Harvard University in 1870 as the electric light of today from the kerosene lamp of the former period. Of course great lawyers were born, secured their training, ran their careers, before either the older or the later Harvard law school was organized and developed. And great lawyers would be born and educated and run their careers today if we had no law schools at all. But so if we had no electric-light society would still continue. We should still do our work by artificial light, great quantities of it at any rate, and society Avould maintain a high degree of civilization if we should forget entirely our intellectual and manual cunning wliich has given us the electric bulb. But just as the latter has increased enormously the comfort and eflSciency of life, so the former has done its part to pave the way at any rate for an entirely new era in the practice of the law and the administration of justice. But this change in American education has come about not merely in the old institutions and the new through a change and, as we believe, an improvement in the content and metliods of instruction in the old subjects, but all grades of education have been quickened by an 138 COMMERCIAL EDUCATION AND BUSINESS PROGRESS enormous extension in the purpose to be served and en- largement in the number and kinds of schools correspond- ing to the new purposes or new insights of society. Not only have the lawyer and the physician and the dentist and the engineer and the teacher found new and improved institutions in which to seek the appropriate training but entire new departments, new spheres, new territories, so to speak, have been added to the scope of university instruction. Most significant, and most impor- tant perhaps, in the long run, of all these newer institu- tions, of all these later attempts to furnish facilities for higher education, has been the great movement toward making the universities the centers of instruction which the future business man would as inevitably seek in prepa- ration for his calling as the future lawyer or physician or engineer or teacher has already become accustomed to look for in these great centers of learning and teaching. I think it safe to say that twenty-five years ago prac- tically no man in the United States whose boy intended to go into business had any thought of sending him to the university because of any special preparation which he might there obtain for his future career as a business man. He might, as many others did, send his son to college for the sake of the liberal training, for the sake of the social advantages, because of tlie acquaintance it might bring to him in his own circle of society, but not because he thought there was anything in the college or university curriculum which had any specific and definite relation toward the work which his son expected to do. And he was entirely justified in such a view by the fact that no institution in this country, except one, namely, the University of Penn- sylvania, had up to that time tried in earnest the project of organizing a department or institution or school, or whatever you may call it, of university grade whose prime fnnrtion should be the special, effective, teclmical training of the young man who souglit its facilities for the active career of business and commerce. UNIVERSITY INSTRUCTION FOR BUSINESS MEN 139 Things are changing today! The leading universities of the country have finally made up their minds, to judge as to their intentions from what they are actually doing, that adequate provision must be made within the scope of university organization for the technical training of men who are looking forward to business pursuits; and even the oldest, most conservative, and for a long time, on this sub- ject, the most recalcitrant university of all — Harvard — has finally become so enthusiastic and as committed to this general proposition as the youngest of our newer insti- tutions. The struggle for the accomplishment of this purpose, which was a long and in many respects a bitter one, has ended in the definite victory of the idea and its acceptance by editors, by business men, by the colleges and univer- sities; and the dedication of this building here upon the campus of the University of Illinois is one of the most striking testimonies to the victorious outcome of this great struggle. We are now face to face with the equally difficult problem of making good, to use a slang term, by demon- strating that we are able to develop in the University a center of instruction, training, and research which will have the same relation toward the great sphere of business life which the law school has to legal life, the medical school to medical life, etc. In other words, we must demon- strate that we have in this field of instruction the conditions of a true professional school and that we are able to develop the content of our subjects of instruction in such a way as to work out a trul}^ professional curriculum — a curricu- lum which we can recommend to tlie young fellow look- ing forward to a business career as something which it would be as well worth his while to spend time and money and effort to complete as it is worth the while of the future lawyer or physician to complete the corresponding curri- culum of their respective schools. And having worked out such a curriculum, and having developed such an insti- 140 COMMERCIAL EDUCATION AND BUSINESS PROGRESS tution, our next problem is to convince the average business man that we have done what we set out to do and that we have something here which he can conscientiously advise his own son to take as a part of his preliminary prepara- tion for the career of a business man. I desire, therefore, on this occasion to submit a few brief considerations upon this proposition. Can we de- velop a college or school of commerce or business here in the University of Illinois which shall be essentially profes- sional in its character? The first question is : What is a profession? The term is sometimes used as a synonym with learned profession, and I have no objection to take the whole phrase. What is a learned profession? Briefly defined, a learned profession is a calling which requires for its most successful pursuit a liberal education as a preliminary training and a special professional course in the sciences underlying the practice of that calling with such applications as may be reasonably made within the time properly assigned to school prepa- ration. You will note the term, for the successful practice of whicli, I mean by successful here, not merely for the suc- cess which involves making a pecuniary profit out of the business; tliat is only one element in the successful prac- tice of a calling which is to be called a learned profession. An important element, it is true, but not by any means the only one. That man is not successful in the practice of such a calling as I have described who accumulates money, if that is done by the violation of law and ethics, if that is done by the merciless exploitation of tlie other members of society, either individual or collective. It is not successful if one of its incidental results is the destruction of other valuable elements in the society of which it is a part. A man may make money, in other words, and yet from any social or ethical or even legal point of view in a large sense, his business and he himself may not only be an absolute failure but may be a curse to the society which has made UNIVERSITY INSTRUCTION FOR BUSINESS MEN 141 his financial success feasible. Now I maintain that to the highest success, success in a true sense of any business man belongs not merely financial accumulation, but belongs such a relation to all the otlier forces at work in his society that the work he has done has been a contribution to the success and advance of every good force and of every good element in the society at work within the range of his influence. Now to make a successful business in this sense a man must have broad views and broad sympathy ; he must see the end from the beginning; he must see how his work fits into the work of other men and helps them at the same time that it lifts himself. For this particular phase of his work, for this broad view and large vision, the element of liberal education and liberal training which I have indi- cated as a part of the definition of a learned profession is very necessary and very vital. Another important element in a calling, which is to be termed a learned profession, is to be found in the definite training in the sciences under- lying the successful pursuit of that calling, and this im- plies that there are sciences, that there is a body of knowledge relating to these subjects which can be systema- tized and put into shape and organized for the purpose of training the youth to a better perception of the princi- ples underlying successful work in this particular calling. A calling which is to be a learned profession and to be cultivated and cherished by society as such must also affect large interests, must have large social bearings, com- prehensive social relations. Tried by these tests the career of a business man cer- tainly measures up today to this standard. In the first place, taking our tests in a somewhat reverse order, the world of business in which this calling of a business man is to be exercised is certainly one of the most important spheres of activity in our modern society; so important is it indeed that at times this activity threatens to swallow up everything else, threatens 142 COMMERCIAL EDUCATION AND BUSINESS PROGRESS to set the sole standards by which men judge of what is feasible or desirable, nay, even of what is ethical. An activity so all pervading that it dominates, controls, gives tone to the thought and feeling of an entire people. The American people today are, in the mind of the world, essentially not an artistic people, not a scientific people, but a business people. We are caricatured not only in our own comic papers but in those of every other country as the dollar savers, as if a business life and business standards were the only ones whicli had for us any specific significance. I am sure I need not dwell upon this point at any great length. The sphere of commerce and merchandising, the interchange of commodities, is so im- portant to the development of our national life that we measure our prosperity sometimes by our exports and im- ports, by the arrivals and departures of wheat and corn and beef and pork in the Chicago and other markets. A nation certainly cannot be a great nation nowadays unless its com- merce and merchandising is highly developed. It cannot achieve the highest success unless these elements are de- veloped to the highest extent and along the right lines — whatever they may be. Surely the great world of banking and money and credit represents a sphere of just as great importance to a liighly developed society like our own as the agriculture or mining or manufactures by which national prosperity is so often gauged. If we could not develop a money system our civilization would be little more than inchoate, em- bryonic, very little above the level of barbarism itself; and if we could not develoj) a credit system we should be confined within very narrow limits for the development of our industry, our commerce, our agriculture. Men talk sometimes about the ])rimary industries — those without wliich society couldn't live, those without wliich it couldn't exist, and attempt to secure for these a sfjccial consideration and a special treatment. In one sense, of course, it is true we could not carry on business for a week unless we had the food furnished by agriculture; UNIVERSITY INSTRUCTION FOR BUSINESS MEN 143 and in this cold climate in the winter time unless we had the coal and wood; nor could we get very far beyond the level of barbarism unless we had the system of com- merce and merchandising. But, after all, if these were all we had, our civilization would fail to rise above a very low type of civilization. To our civilization in its present form and to its future higher developments the discovery and organization of a reasonable money system and rea- sonable credit system are just as necessary as the produc- tion of crops or the mining of coal, or the buying and sale of these and other commodities. Nay, without this higher development of money and credit we could not obtain the agricultural products or the yield of the mines for the purpose of developing this higher society. So in the great field of transportation, the movement of men and commodities from one part of the country to the other and from one part of the world to the other, and the proper organization of this business as society develops upon an ever higher and more effective form, is absolutely necessary to human progress. There are some signs already abroad in this country that we have almost reached the limit of our powers of organization in this great field of national life and endeavor. There are signs that our transportation system has outgrown the ability of men to handle, at least of the men which our society can produce, and it is perfectly evi- dent that if we cannot improve our transportation system on the business and organizing side of the same it will make but little difference to us how many improvements we are able to work out in the detail of the steam engine or in the application of other kinds of mechanical devices to the work which is to be done. Tlie same thing is true of course of the money and banking system which I have just mentioned. You are all familiar with the fact that we have now for a generation in this country been quarrel- ing over the fundamental principles and the practical applications in the world of money and banking. Many of jou can remember how, only a short time ago, you couldn't 144 COMMERCIAL EDUCATION AND BUSINESS PROGRESS get your own money out of your own bank because of the practical breakdown of our whole banking and credit sys- tem, in the face of widespread alarm and panic. It is per- fectly evident to the thoughtful observer that the develop- ment of our industry and that the development of our so- ciety are limited or confined within narrow bounds unless we can progressively work out a better scheme of organiza- tion than that which we have thus far elaborated. Surely those fields must be important fields of human effort, upon the successful cultivation of which depends the whole prob- lem of a continuously advancing civilization. I haven't time, of course, to mention other spheres, and yet perhaps I might at least name one other, and that is the great field of insurance. I don't know that anything is more charac- teristic of our modern society than the tendency to protect the members of human society from the effect of overwhelm- ing disasters of one kind and another over which they can have, in their individual action and in their individual capacity at any rate, and sometimes in their collective ca- pacity, little or no influence. We must all die! But by the proper kind of an industrial scheme we may be able to protect our families from immediate want through the device of life insurance. We may not be able to protect our houses absolutely from destruction by fire, but we may at least mitigate some of the material suffering, some of the material consequences of such disasters by the device of fire insurance; and now we are going forward to the various forms of social insurance against sickness, against the helplessness and dependence of old age, against the evil results of lack of employment, etc. Now here is a great, largely undeveloped, field of liuman activity waiting for men of brains and energy to develop in the interest of society. Surely then we have here in this world of busi- ness, so to speak, an important field ; and tlie calling of a business man has one of the characteristics of a profession, therefore, in that it is exercised within a great and im- portant field of human activity. Many causes have been assigned for tlie destruction of the Roman empire. I tliink we know very little about the UNIVERSITY INSTRUCTION FOR BUSINESS MEN 145 real reason why the Roman state decayed, any more than we know the real reason why man grows old or a tree runs its course ; but it is perfectly evident that one of the signs of degeneration, whether fatty degeneration or not, I am not sure, one of the signs of national degeneration in the period of the decay of tlie Roman empire was the progres- sive inability of the Roman state to organize its business on a continuing and sound basis. Its money and credit sys- tem both broke down quite as sadly and quite as positively as its agriculture and its industry. And it is perfectly evident tliat unless we can secure the necessary brains, so to speak, the necessary intellect of the country concentrated upon the solution of the greater problems of business organization and development we shall reach the limit of our advancing civilization at a comparatively early stage of possible human development. Another characteristic of a learned profession is the existence of a science or group of sciences — by which I mean groups of organized knowledge — the study and in- vestigation of which form the basis of a systematic train- ing. Now has the world of business such underlying sciences, or are we in the way of developing them? I think myself we have this fundamental basis for the development of a learned profession. I should say that the most fundamental science, though not by any means the only one, is economics, using that term in a large sense. If we take the old definition of economics, which for our immediate purpose is correct enough, that economics is the science of the production, distribution, and consumption of material wealth, and con- fine ourselves to the subject even as marked off in this rather narrow and limited definition we still have a definite valuable body of doctrine wliich may be used as a basis for intellectual training, and as a means of practically equip- ping the student witli what may be called an instrument of investigation. We liave in connection with this subject, using it in its larger sense, a scientific literature which has been developed and elaborated by some of the most 146 COMMERCIAL EDUCATION AND BUSINESS PROGRESS acute minds of the human race; and this possession of a scientific literature, which is the outcome of thought by really able minds, is one of the necessary characteristics of a career which can be called in any sense a learned pro- fession. I defy any man to wrestle with the doctrine of marginal utility, of rent, of wages, of international trade, of the value of money and credit, without feeling that he is up against as serious and difficult intellectual problems as are opened in the whole range of physics or mathematics or chemistry or engineering; and the consideration of these doctrines is fundamental to any intelligent opinion in regard to the desirable development of business in its large scope and outlines. One may say, of course, that the •class of questions, to the settlement of which a knowledge «of these subjects is necessary, belongs rather to the work of the statesman than to the business man; but in my conception the business man, if he is going to practice a successful profession in the sense in which I have used that term, ought to be and must be a statesman and must have the statesman's point of view. The names of Smith, Malthus, Kicardo, Mill, Cairns, Marshall, Patten, Kinley, Seager, are mere examples in our own English literature of men, the following of whose thought is a liberal educa- tion in itself and the mastery of whose ideas will lay the foundation for the highest quality of intellectual effort in any department. Ramifying out from economics as a science, branching and spreading in countless directions, other subjects are springing up, other sciences are developing which go to make up the content of the course of study which the future man may well follow as a special technical prepa- ration for his calling. We speak now of the science of finance, of the science of money and banking and credit, of the science of transportation, of the science of account- ing, of the science of insurance; in each of these cases there is already a collected body of doctrine which may be made the l)asis of an intellectual and practical training of use to anyone who is willing to give the time and energy UNIVERSITY INSTRUCTION FOR BUSINESS MEN 147 to its acquisition ; and the study of all these subjects, aside from giving definite information which would be of value to the business man, would open his eyes, enlarge his vision, train his judgment, quicken his initiative enterprise. In otlier words, make him a liberally and technically trained man for the work which lie is about to pursue. My first proposition then is, that the establishment of such courses of training as these and the investigation of the subjects utilized for this instruction is clearly desir- able in the interest of more efficient training of the business men themselves in order to enable them to be more surely successful, and successful in the largest sense, in the life which they propose to enter upon. There is another im- portant side of this question which I wish to mention, at any rate, before closing. If such a system of education is desirable in the interest of business and the business man on the one hand, it is equally desirable on the other that business men receive such an education in the interest of society in general. Nothing is more remarkable in the development of modern social life than the ever increasing importance of the business classes of the community. Even in Europe where the nobility, the army, the civil service, the learned professions, still occupy the leading social and political positions, the social status of the business classes is con- tinually changing for the better; the business classes themselves are acquiring a continually increasing influence in politics and society. In our own country where busi- ness was from the beginning the occupation of a leading portion of the community, the business classes were never beyond the pale of society as in Europe ; but even here, the relative position of business men in politics and society is rapidly changing to the disadvantage of the classes for- merly looked upon as social and political leaders. The heroes to whom our children look up, whose deeds are related with admiration, are today the great captains of trade and industry, as the great orators, preachers, and lawyers were of a former period. Whether for weal or 148 COMMERCIAL EDUCATION AND BUSINESS PROGRESS woe, the dominating tone of American society, tlie ideas of American youth, are set to an ever-increasing extent by the great railroad manager, the insurance director, the banker, the merchant, the manufacturer. What should be the characteristics of a model business man? I need not stop to speak of those absolutely funda- mental qualities which are so often recommended to us in prose and verse — such as sobriety, industry, perseverance, honesty, etc., qualities which are generally acknowledged to be necessary to all classes of men. I would, however, especially emphasize initiative enterprise, broad views of industrial problems and possi- bilities; a sense of the nobility of business and the possi- bility of usefulness to society through ordinary business channels; an esprit du corps which feels to the quick any base or stupid action of a fellow business man as a dis- grace to the calling — that fine sense of honor which should characterize every profession. The business classes of a community should follow the injunction of the Apostle, and magnify their calling by adorning it with all those qualities which call forth the admiration of the best men. No one can study the history of civilization from an economic standpoint without becoming convinced that scant justice has been done in our literature and history to the fundamental importance of trade and industry to the progress of civilization itself. We trace the history of politics and political divisions, of wars and kings and generals, of law and theology and medicine, of science and literature and art, and think we have a fairly complete view of human liistory. Tlie progress of mankind, however, is nowliere more clearly reflected than in the invention and perfection of money; or in the establislmient and develop- ment of banks; or in the origin and growth of insurance; or llic development of clearing-houses, and the other thousand and one devices of our credit and monetary sys- tem. Let us recognize clearly that an imi)rovement in business — a new device or a new application of an old one — is of ;is iinuli interest to humanity as a discovery in medi- UNIVERSITY INSTRUCTION FOR BUSINESS MEN 149 cine, or an improvement in law, a new formulation of a theological creed or the invention of a new motive power. The promissory note in all its various ramifications is perhaps as important to human welfare as the microscope itself, while the invention of money is even more important than the printing-press or the steam engine. There is an opportunity in the dull round of business not merely to earn a living, not merely to provide for one's family, not merely to heap up wealth which may be used to found a hospital or a college, but to confer blessings of incalculable benefit upon mankind by improving the processes of busi- ness itself. No thoughtful man can look around him in any branch of business without seeing numerous points at which it may be improved, and the history of other branches of human life show how much individual men may accomplish by giving their thoughtful attention to such things. Such work is as truly scientific in character and philanthropic in its results as the search for the cholera bacillus and its remedy. Sucli a mode of viewing business would not only tend to improve the character of business methods, but it would raise the whole level of business thought and feeling, in- crease the interest of business men in their work and react beneficially on society in general in countless ways. It would tend to beget an esprit du cot'ps, wliich would do away with countless abuses of our business life growing out of the bitter competition of our modern economic system. I take it there will be little difference of opinion upon these points. My experience as a teacher leads me to be- lieve that much may be done by a systematic school training to develop the above mentioned qualities in the future business man. The aim of commercial education, such as I am plead- ing for, is to awaken a profound interest in business as such; to train youth to an appreciation of the functions of business and business practice in our modern life ; to inform him as to the history of industry and trade; to awaken 150 COMMERCIAL EDUCATION AND BUSINESS PROGRESS his interest in its future; to train him to keep his eyes open as to business possibilities; to inspire him with a healthy respect for business in all its various branches; to arouse a determination to become not only a success- ful business man in the ordinary sense of the term, but a useful one as well; to beget a public spirit; to excite an interest in the higher welfare of society ; in a word, to be- come a public-spirited, intelligent, well-educated, and suc- cessful man of affairs. ^^gTsV^^^yy^^i ^L„ Presentation of the Portrait of the Late Mr. Edward Jarvis Parker to the School op Commerce B. F. Harris Representing the Illinois Bankers' Association With all the ceaseless moil and toil of the countless captains of the numberless industries and enterprises that constitute what we call commerce, there is all too little sentiment or all too little of the things that make for inspiration. With all our various vocations we are overlooking or omitting the avocations which would add so much to our own life and the lives of those about us. It is particu- larly necessary in these days, that the modern school of commerce should make many-sided men, tliat sentiment should have its proper bearing and citizenship loom larger. Perhaps the best sign of the times is the change in public attitude which brings moral purpose to public as well as private affairs, it requires more of consistency and less of expediency, and, in a word, holds some higlier hope than mere dollars. In short, the day and dictum of dollar diplomacy are in the discard, and days of real progress are come, "for man liveth not to himself alone nor by bread alone." One of the best object lessons and inspirations in this direction will lie in the gathering together here in a Hall of Fame, the portraits not simply of men who attained eminence and renown in their devotion to the various departments of commerce, but withal were helpful, force- ful citizens, loading or working with every movement con- cerned with the making of a bigger, better, broader, and fuller civilization. This portrait, the first we are to place, is most happily chosen. Edward Jarvis Parker, banker, typified all that the term good citizenship comproliends. A little more than a year ago, after practical!}' fift}' years spent in 151 152 COMMERCIAL EDUCATION AND BUSINESS PROGRESS building up and directing the largest bank in the state outside of Chicago, Mr. Parker went to a certain reward, mourned as the first man of Quincy. He had shown that the rare qualifications of the exceptionally able banker and business man could be combined with the unusually versatile and public-spirited attributes of citizenship in a most successful and helpful, active business life, reach- ing in numberless directions that touch the human side of things. His activities in the public welfare, in legislation, in art, in benevolences were nation-wide, but his greatest pride was in the Park Boulevard System which he con- ceived and carried out in Quincy. The banker should be the bravest man in town, and the least afraid of criticism. That Mr. Parker met these requirements, my personal acquaintance with him made certain. He had in a large degree, that splendid spirit and conception of public duty that we call virtue, that makes good citizenship, and so makes good government and the things we have referred to possible and enduring. It is this spirit of good citizenship, that must pene- trate the nation, that it is the duty of our University to spread abroad, that the School of Commerce must breathe into its graduates, and that the story and portrait of Edward Jarvis Parker and others who are to follow will exemplify and inspire. JOINT BANQUET, DEDICATION OF THE COMMERCE BUILDING UNIVERSITY OF ILLINOIS The Commercial Club of Urbana and The Chamber of Commerce OF Champaign Armory, April 17, 1913 Program Invocation Rev. S. E. Fishee J. M. Kaufman — President of the Chamber of Com- merce C. D. RouRKE — President of the Commercial Club Brief Talks Edmund J. James, President of the University of Illinois David Kinley . . Dean of the Graduate School H. I. Green Urbana Dr. W. F. Burres Urbana B. F. Harris Champaign J. R. Trevett Champaign Honored Guests W. L. Abbott . President, Board of Trustees, U. of I. Thomas McClelland . . President, Knox College S. T. Henry . Western Manager, Engineering Record L. C. Marshall, Dean^ College of Commerce, University of Chicago H. EltinG;, President, Chicago Association of Commerce music^ courtesy of the University of Illinois Band A. A. Harding, Director 153 INDEX Abbott, W. L., 133-135, 153- Accountancy, 3, 4, 95, 98, 146. Advertising, 4, 95, 98. Agriculture, 24-32, 119, 120. Agricultural Building, 24. Agricultural economics, 29, 30, 31. American Bankers' Association, 51, 56, 57, 58, 59, 60. Amos Tuck School, 105. Atkinson, Edward, 57. Banking, 27, 28, 126, 142, 143, 146. Banquet program, 153. Boards of trade, 13, 14. Bolles, Albert S., 53. Budget, its nature, purpose and effect, 35-50. Burress, Dr. W. F., 153. Business Administration in its Relation to Public and Private Welfare, 6, 11-32, 35-66. Business ethics, 71, iii, 122, 124, 130, 140. Business organization and practice, 4. Business Problems of Agriculture, 24-32. Business training, factors in, 94-98. Butler, George A., 59. Chamber of Commerce of Champaign, 7, 153. Chamber of Commerce of the United States, 11. Chambers of Commerce, 13, 14. Chicago, 92, 107, 142. Chicago Association of Commerce, lOi, 105. Civil Service Commission, 48. Cleveland, Frederick A., 16, 35-50. Clow, W. E., 92. College graduate, characteristics of, 108-118. College Graduate a Business Tyro — a Matter of Adjustment, 101-118. College of Engineering, 22, 133. Commencing Right, 69-83. Commerce, professorship of, 3. Commerce Building, i, 3-6, 25, 133, 135, 139. Commercial Club of Urbana, 7, 153. Commercial clubs, 13, 14. 154 INDEX 155 Commercial education, demand for, 15, 93, 94, 95, 97> 98; development of, 51-61, 65, 90, 105, 138; in Germany, 86, 125 ; in the University of Illinois, 1-4, 105; necessary, 15, 22, 23, 27, 70, 87, 102; purpose, 16, 17, 66, 85, 86, 88, 89, 106, 107, 125, 127, 128, 130, 131, 134, 147. 149; relation of, to Agriculture, 26, 28, 29, 30; result of, 86, 109, 112, 113, 114, 115, 116, 117, 118; support of, 2, 3, II, 125, 135- Commercial Education and Business Success, 6, 69-98. Commercial lavif, 4. Commission on Economy and Efficiency, 35. Committee on Education, Illinois Manufacturers' Association, 92. Conference on commercial education and business progress, i, 6. 13. Congress, 37, 38, 39, 41, 42, 43, 44- Constitution of Great Britain, 38, 39, 40. Constitution of the United States, ZT, 38, 41, 44. Convention of the American Bankers' Association, 56, 57, 58, 60. Convocation, 8. Dartmouth College, 105. Dedication of the Commerce Building, 6, 101-152. Department of Commercial Science and Art, i. Economics, registrations in department of, 3. Education in the United States, development of, 61, 62. Education of Business Men, 57. Efficiency in business, 11-16, 18, 31, Elting, Howard, 101-118, 153. Ewing. Charles A., 24-32. Executive responsibility, 45, 46-50. Export trade, 122, 123. Farm management, 28, 29. Federal government irresponsible, 36. Fisher, Rev. S. E., 153. Green, H. I., 153. Harding, A. A., 153. Harris, B. F., 151, 152, 153. Harvard University, 16, 60, 105. 106, 136, 137, 139. Hegeler. Julius, 92. Henry, S. T., 18-23. 153. 156 COMMERCIAL EDUCATION AND BUSINESS PROGRESS Hill, James J., 26. Hudson tunnels, 19. Illinois Manufacturers' Association, 92. Industry and Transportation, professorship of, 3. Insurance, 144, 146. James, Edmund J., 3, 5i, 53, 56, 57, 58, 60, loi, 136-150, I53- Kaufman J. M., 153. Kinley, David, 2, 60, loi, 107, 1 19-132, 146, 153. Letter from: Accountant, 112; Bank president, 117; Insurance firm, 116; Manufacturer, 115, 116; Railroad president, 108; Railroad super- intendent, 108; Retailer, 113; Wholesaler, 114. McClelland, Rev. Thomas, 8, 153. McKinley, William B., 7. Marshall, Leon C, 84-91, 146, 153. Medical School, Harvard University, 137. Medical School, University of Pennsylvania, 62. Morgan, J. Pierpont, 71, 80, 103. Normal schools established, 62. Northwestern University, 16, 105. Origin and Progress of Business Education in the United States, 51-66. Parker, Edward Jarvis, 151, 152. President of the United States, 36, 37, 38, 39, 41, 42, 43, 44, 49. Presentation of the Commerce Building, 133-135. Presentation of the portrait of Edward J. Parker, 151, 152. Program of Conference on Commercial Education and Business Prog- ress, 7. Pujo Commission, 80, 103. Public Concern in Improved Business Administration, 11-17. Questionnaire of the Illinois Manufacturers' Association on College Courses in Business Administration, 92-98. Railway administration, 3. Railway mileage of Illinois, 27. Relation of a School of Commerce to the Practical Problems of Business, 84-91. Resolution of the American Bankers' Association, 57, 59. Responsibility to the electorate, 35, 36, 44. INDEX 157 Revell, Alexander H., 69-83. Rhawn, William H., 51, 55, 56, 57, 59. Rourke, C. D., 153. Salesmanship, 4, 22, 23 95, 96, 98. School of Commerce, University of Illinois, 2. Schools of Commerce and Improvement of Business, 1 19-132. Secretaryships, 4, 15, 16. Service sales work, 18-23. Snyder, Capt. Edward, i. Some Business Tendencies of the Day, 18-23. Stewart, Charles L., 92, n. i. Success in business, 27, 74, 75, 76, 79, 103, 127, 140, 141. Tariff, 31, 43. Trades organizations 13, 14. Transportation, 143, 146. Trevett, J. R., 153. University Instruction for Business Men, 136-150. University of Cambridge, 66. University of Chicago, 60, 84, 105. University of Illinois, loi, 133; College of Engineering, 22; Commerce Building, i, 3, 4 5, 6; commercial courses in, i, 2, 3, 60, 61, 97, 105, 140. University of Michigan, 60, 105. University of Pennsylvania, 3, 51, 52, 57, 60, 105, 138. University of Wisconsin, 60, 105. Vanderlip, Frank A., 119, 129. Vocational training, 62-66. Wharton, Joseph, 51, 52, 56. Wharton School of Economics and Finance, 3, 51, S3, 54, 55, 56, 57, 58, 59. What a Budget May Mean to the Administration, 35-50. Wheeler, Harry A., 11-17. Wilder, John E., 92. the i^st date stamped belc UNIVERSITY OF CALIFORNIA LIBRARY Los Angeles This book is DUE on the last date stamped below. Form L9-Serie8 4939 UC SOUTHERN REGIONAL LIBRARY FACILITY AA 001 006 851 8 PLEAfif: 00 NOT REMOVE THIS BOOK CARdS University Research Library J n n I. .; r^