The Machine That Kept Them Honest


Into this traditional business environment Patterson introduced several startling new concepts. He began by building (with borrowed money) a model plant on the old family farm. It was a revolutionary concept in industrial architecture, a “daylight” building with eighty per cent of its walls made of glass and with ampélopsis climbing up the brickwork; the grounds were landscaped and dotted with flower beds. Inside, the revolution was just as complete. There were lockers and showers, swimming pools and other recreational facilities, hot lunches, medical care, and inspirational lectures to give wings to the mind.

These pioneering efforts in industrial welfare—and the high rate of pay at “the Cash”—attracted so much attention locally, nationally, and even internationally that Patterson, who explained gruffly, “It pays,” hung a sign by his office door: “Be Brief—Omit All Compliments About Welfare Work.”

In exchange for his unusual attentions to the N.C.R. employees, Patterson exacted absolute obedience and a high rate of productivity. In a day when good management meant cost-cutting, Patterson took the opposite tack—the way to make money, lie believed, was to spend it. Secrecy, too, was highly regarded as a competitive weapon. But Patterson welcomed visitors to his plant and even wined and dined—no, just dined- competitors and would-be competitors. He inevitably showed them “the Gloom Room,” where they were urged to gaxe upon piles and piles of rusty registers, the products of bankrupt companies that couldn’t stand the pace set by National. It was unforgettable evidence of the folly of bucking John H. Patterson.

Patterson soon demonstrated his native flair for showmanship. One day when he was escorting some friends through the factory, he stopped before a shiny new register that had been checked out for shipment. He started to point out the model s special features. One key stuck. Another wouldn’t depress. Patterson reached for a hammer and reduced the register to a mass of junk.

“That is how we take care of faulty machines,” he said casually.

But the glory of N.C.R. was what Patterson called “the American Selling Force.” With nothing in hand but the legal right to make a mechanism for which there was no demand, but with an almost apocalyptic vision of a universal market of prospective purchasers who needed a cash register and didn t know it, Patterson put together the most aggressive corps of salesmen the world had ever seen. He argued witli his men, coaxed and criticized, often lashed them with biting sarcasm, preached and exhorted. He supported the Force with aggressive advertising, and tried to generate in each man an incentive equal to religion’s fear of damnation and hope of salvation. It was the missionary spirit of spreading the gospel to the heathen, hooked up with American boosterism.

A man who looked like a comer was often taken by Patterson to New York at company expense to stay at a luxury hotel, get measured for a good suit, visit the finest hatters and custom shirt shops, see a couple of shows, and generally, in Patterson’s words, “get the hayseed off him.” A taste of the Heshpots, Patterson figured, was a sure-fire way to spark the imagination of a good man who would like to have a new davenport and join the local country-club set. Patterson introduced the idea of the guaranteed territory and paid straight commissions on which a man could really make money. Refusing to follow the common practice of the times, he did not cut back the commissions when business was good. “If you can sell a million dollars in a week,” he declared expansively, “we’ll hire a brass band to take your commission to you.”

The idea of the sacrosanct commission took hold slowly. Years afterward Thomas J. Watson, brilliant leader of the International Business Machines Corporation and a member of the distinguished body of Patterson alumni, remembered how back home in Painted Post, New York, when a local man boasted that he had made thirty dollars selling a cash register, he was deemed to be the biggest liar in the Cohocton River valley.

One of Patterson’s early formulations now regarded as an invaluable business tool was the establishing of sales quotas, based upon an objective analysis of potential opportunity in a territory. The quota system ironed out the inequities, applied the same measure to all salesmen, meant the same thing in Portland, Oregon, as in Utica, New York, in Indianapolis as in Bangkok.