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MANAGEMENT: Case History

3 minute read

W. (for William) Harold Rea, 47, president of Canadian Oil Companies Ltd., was a logical choice for guest speaker at last week’s meeting of Toronto’s National Sales Executive Club. Rea’s company, a 98.7% Canadian-owned firm, is one of Canada’s fastest-growing oil and gas companies. Its 1954 report showed a $2,000,000 sales increase and a 20% rise in net profit over 1953.

As his topic, Speaker Rea chose to tell “a true story of a business problem faced by the chief executive of a medium-sized company.” The executive, said Rea, was deeply worried about the state of his company’s business, as well as the efficiency of his own office and the top men around him. On a friend’s recommendation, he took his problem to a psychologist.

The company president underwent a series of IQ and aptitude tests and personality studies. Then his ten chief aides were called in one by one for confidential interviews about their relations with the boss. When it was all over, the psychologist summoned the president. “You’re asking for it,” he said. “It has to start with you.” With frankness he ticked off the president’s business faults, portraying him as a penny-pinching worrier about small details, an employer who refused to delegate authority to his staff, an indecisive person who would not let underlings make decisions. “It’s an afternoon I’ll never forget,” the company president said afterward. “Never before have I paid out so much to feel so miserable.”

The president’s first impulse was to resign, but the psychologist talked him out of that and persuaded him to begin correcting his executive faults. He scrapped his rule of passing personally on every cost item over $1,000, and let his assistants handle anything up to $20,000. Each executive’s job and responsibilities were carefully defined, and each man was given a free hand to run his own department. As a result, they took more interest in their work. The president’s desk was magically cleared of all the picayune problems that once piled up. He had more time for long-range planning and overall policy, and the company’s sales and profits rose in gratifying fashion.

Harold Rea’s surprise ending to his true story made it Topic A in Toronto business circles for days afterward: “The company I have been talking about is my own company. The chief executive I have been talking about was your speaker.”

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