Higher Education and Business Standards

by Willard E. Hotchkiss

His response to the first question revealed to me an intensely natural but nevertheless complex motive. He said, substantially, that he was confident that standardized employment was the only acceptable policy, from the standpoint of the general manager. Given the necessity of standardizing, it was necessary for the general reputation of the business to standardize upward rather than downward. He wanted his business to be regarded as one in which the best standards of employments obtained. Furthermore, he added, "California will soon have a minimum wage law, and I want this business to be well in advance of any wage standards which may be imposed by law."

Answering the second question more specifically, the manager recognized the advertising value of a reputation for having good conditions of employment. He had discovered no tendency for general profits to diminish or for the rate of increase to be retarded more than temporarily. In the absence of definite facts to the contrary he considered it safe to assume that as soon as the business should become adjusted to the new standards, standardization of wages upward would be profitable for the business as a whole. He wanted to make the change voluntarily and to commence operating successfully on the new basis in advance of competitors.

It is scarcely possible to discuss this sort of business situation with a progressive manager, without feeling that he does not approach business exclusively from the standpoint of gain; in other words, to use the phrase of Adam Smith, he is not exclusively an "economic man." The manager of a modern business, on the contrary, is a man very much like the rest of us, and being such a man he is first of all desirous of conforming to whatever standards are in way of acceptance by that part of society in which he moves. Obviously, these standards are made up of both selfishness and altruism, with selfishness tending all the time to become more enlightened as society advances.

As we come to distinguish more clearly between reward for service and mere one-sided gain, there occurs a parallel change in men's motives; they become more sensitive to social disfavor and to social esteem and less and less willing to devote their lives to activity by which no one but themselves is benefited. In this reaction of altruism with enlightened selfishness there emerges in men's minds a new concept of their own interest and a better understanding of the kind of business policy that in the long-run brings them the greatest reward. Of course, this does not mean that enlightened selfish interest has ceased, or that it will ever cease, to be a motive force in business. But there is a vast difference between selfishness untempered with other motives and selfishness eager for the esteem of one's fellows.

Clearly it is a task of higher education to help promote response to the more enlightened motives. The difficulty which even men of advanced university training have in taking full account of human factors indicates something of the nature and importance of the task. The so-called "scientifically trained" manager tends to undervalue the human factor of his equation. His analysis is likely to be overweighted on the material side. When the university starts—as it is starting and should start—to train future executives, it needs to analyze its own problem, and take full account of the dangers against which it has to guard. Otherwise the training itself will be overweighted on the material side and will perpetuate the weakness that it ought to correct.

The greatest danger in this connection, as I see it, arises out of the distinction between the so-called "cultural" and the "vocational" point of view. This distinction comes to us with a large mass of traditional authority, and we have classified subjects and erected barriers on the assumption that the distinction is real. As far as the training of business executives is concerned, I am confident that the distinction is one which ought never to be made. It is a great misfortune, when young men and women who are preparing for a serious career are permitted to think of culture as a non-functioning ornament; equally unfortunate is it for them to think of their prospective vocations as activities devoid of cultural association.

A few days ago a student who had already selected his profession and was anxious to be about it confided to me, as many others have done, how distasteful he was finding the task of "working off his culture." Does any one really suppose that the sophomore who is "working off his culture" under faculty compulsion, in order to get his college degree, is really absorbing from his study anything which, as the faculty assumes, makes him a better man and yet, as he himself believes, contributes nothing to effectiveness in his profession? Or take the case of the man who devotes himself with professional earnestness to his two, three, or four years of college work—will he find that he has invested his time and his money on a purely ornamental luxury that has no relation to his later work?

The first great element of training which the university can give to future business men is a mastery of scientific method as a means of analyzing problems and synthesizing results. Quite as fundamental as this is the development of an intelligent and sympathetic approach to questions of human relationship. Only the beginning steps in the direction of business efficiency can be taken while attention is confined to the material and mechanistic side of business organization. No secure basis for permanent efficiency can be established until we are prepared to go deeply into the question of human motives and to understand something of the complex reactions that come from individual and group associations. Without such a basis we cannot hope for a nationally effective business organization.

Business is a form of coöperation through which men exercise control over natural forces and thereby produce things with which to satisfy human wants. Any subject well taught, which gives an insight into human relations or into nature and man's control over it, will help prepare a person to deal with the intricate problem of human relations in business—that is, if the student has studied the subject in an attitude of mind to see its bearing on what he is preparing to do.

The question is not so much one of too few or too many so-called culture subjects, but rather of the attitude of mind in which all subjects are undertaken. It is a question of getting such a survey of the great facts of human experience and of so pointing their significance as to enable men to approach a problem of human relationship with sympathy and something of a long-time dynamic viewpoint. When this is accompanied by a mastery of scientific method, the foundations are reasonably secure. Without such foundations, secured either in college or out, analysis of problems in a specialized business field is almost sure to be one-sided and incomplete.