February/March 1987 | Volume 38, Issue 2
In 1921 Wilson & Company, a Chicago meat-packer, was hired by Arthur D. Little, founder of the management consulting company that bears his name, to throw one hundred pounds’ worth of sows’ ears into a big pot, cook well, and provide him with ten pounds of the gluey goo that came out. Little squeezed the goo through a spinneret to turn it into thread. He soaked the thread in a glycerin solution to soften it, and then, on a special loom, he wove the thread into a silky material. Out of that he made two purses, thus proving that an ingenious chemist could, in fact, make a silk purse out of sows’ ears.
Little did not stop there. He was not only a good chemist but a good businessman, and he ordered the preparation of a promotional booklet: “Does it not seem reasonable to you, dear Sir and Reader, that an organization which includes chemists that can make silk purses out of sows’ ears, just for the fun of doing it, is also qualified to do other things? To solve problems for instance which hold back the progress of industry … ? Who says it can’t be done? Let’s dig in and find out.”
One of the two purses that Dr. Little made in 1921 has been on display for many years at the Smithsonian Institution in Washington. The other, now insured for forty thousand dollars, remains the property of Arthur D. Little, Inc., which celebrated in 1986 its centennial anniversary. The story of this unusual enterprise—the story of one hundred years of digging in and finding out—has been told in detail in a new book, The Problem Solvers: A History of Arthur D. Little, Inc. , by E. J. Kahn, Jr. (Little, Brown).
Any comprehensive history of consulting would have to begin with the Delphic oracle. It is only in the twentieth century, however, that business consulting has itself become a big business. Top firms like Arthur D. Little (ADL), McKinsey & Company, Inc., and Booz, Alien & Hamilton Inc. employ thousands of people, operate in dozens of countries, and generate revenues of well over a hundred million dollars a year.
What exactly do these organizations do? ADL describes itself blandly as an “international research, engineering and management consulting organization” whose business is “to help industry, governmental agencies, and institutions throughout the world solve the problems and exploit the opportunities inherent in change.” Its professional staff, ADL goes on to explain, includes experts in “food and agribusiness, chemical industries, petroleum, utilities, metals, health care, construction, banking and other financial industries, electronics, automobiles and transportation.”
An ad published in 1907 was more concise: “Other people’s troubles are our business.” More recently ADL defined its business as the “application of research principles to solution of the problems of people who are willing to pay to have them solved.” Broad as it is, that definition seems to fit.
ADL’s headquarters are located on a forty-acre site named Acorn Park—staffers call it the Nut Park—in Cambridge, Massachusetts. Dr. Little was fond of the saying, “Great oaks from little acorns grow,” and for years the company’s symbol was a winged acorn. The history of the company bears out the adage.
Born in Boston in 1863, Arthur D. Little attended the Massachusetts Institute of Technology, but financial considerations forced him to leave after three years. The lack of a degree did not stop him from serving eventually as president of the MIT Alumni Association and as a life member of MIT’s board. Nor did the lack of an earned doctorate (he had plenty of honorary ones) stop other people from calling him Dr. Little.
Little went to work as a journeyman chemist for the Richmond Paper Company in Rumford, Rhode Island. There he met an exceptionally able young man, Roger Griffin, with a decade of experience in chemical analysis.
In the fall of 1886 Little and Griffin formed a partnership. An ad was placed in the New England Grocer : “Examinations of Chemicals, Drugs, Paints, Oil, Grease, Soap-Stock, Soaps, Fertilizers and Fertilizing Materials, Minerals, Iron and Steel, Water Analysis, Analysis of Foods and Food Products, and all kinds of general analyses made in the SHORTEST POSSIBLE TIME and at the lowest price compatible with Accurate and Reliable work.”
The firm of Griffin & Little, Chemical Engineers, was located in cramped quarters on the sixth floor of a dingy brick building at 103 Milk Street in downtown Boston. The firm had an initial capital of twenty-five hundred dollars, raised by Little. In its first year it managed a net income of six hundred dollars on sales of eighteen hundred dollars. Seven years passed before the combined earnings of the partners reached forty-four hundred dollars in one year—exactly the amount that Little alone had earned at the job he had quit to become his own boss.
The work required patience and precision. Between 1888 and 1893 Roger Griffin analyzed fifty thousand samples of sugar, at seventy-five cents per sample, for a single chocolate manufacturer.
The work could be dangerous too. In 1893 Griffin took a moment to tighten the stopper on a flask that was leaking slightly. The flask broke, and flaming vapor leaped to cover the unlucky chemist. He died the next day.
The application of chemistry to commercial problems might seem obvious to us, but it was not obvious to most Americans in the last decades of the nineteenth century. The American Chemical Society was founded in 1876, and it had only 241 members when Griffin & Little was formed.
In those days, Little wrote later, “industry and science were comparative strangers, and industry had little desire for closer acquaintance. … In such a setting, the new laboratory stood like an outpost of pioneers in a forbidding land. For many years its essential business was that of blazing trails and inducing reluctant manufacturers to use them.”
A vivid example occurred early in the history of the firm. Griffin — Little had obtained an option for the American rights to a process for converting cellulose into a viscous liquid ( later given the name viscose) that chemists then could turn into nonflammable film and artificial silk.
With what he later described as the “destructive humility of chemists,” Little went to a number of bankers, including J. Pierpont Morgan and Bernard Baruch, in a vain effort to get the backing he needed to develop the patents.
“While every chemist will admit he needs a banker,” Little wrote later, “the fact that every banker needs a chemist is not yet recognized in financial circles. … It was the scarcity of educated money in this country in 1901 which caused the viscose patents for artificial silk to be sold at auction for $2,500, and which for many succeeding years diverted into English pockets the enormous profits of rayon manufacture in America.”
Little never tired of complaining about the waste that resulted from the failure to apply science to industry. In the years before World War I, he calculated, the practice of throwing away old pencil stubs cost the nation 150 million tons of wood, 1 million tons of flax straw, 13 million board feet of lumber, and 365 billion cubic feet of natural gas each year. “The United States,” he wrote, “is an aggregation of undeveloped empires, sparsely occupied by the most wasteful people in the world.”
Slowly the message got through. In 1911 a young company named General Motors hired ADL to organize its first research laboratory. Through most of the 1920s and 1930s, ADL drummed up enough work to support a staff of about fifty. It was not until 1944, nine years after Little’s death, that gross revenues reached a million dollars a year.
The firm gave good value for the money. For Hires, ADL came up with a substitute for sassafras and safrole when the government banned those ingredients in root beer. Cream of Wheat might never have found a huge market if ADL had not devised a technique to reduce its cooking time from one hour to five minutes. From ADL, the Great Southern Lumber Company learned that every day it was throwing away material that could be turned into 794 tons of paper, 60 tons of resin, 6,000 gallons of turpentine, and 12,000 gallons of ethyl alcohol.
The U.S. government has contracted with ADL for a great deal of military work. When the Chemical Warfare Service was created in 1918, it hired ADL to work on gas masks. Robert V. Kleinschmidt, an ADLer with a Ph.D. in chemical engineering from Harvard, developed in 1939 a still to convert salt water into fresh water. By the end of World War II, enough stills had been placed in service, mostly on submarines and with Marine Corps units, to provide ten million gallons of fresh water a day.
After the war ADL engineers designed the propellant-loading systems for the Atlas and Titan missiles, and ADL helped develop the Navy’s Trident program for submarine surveillance. For the Apollo program, ADL has worked on meteor bumpers for spacecraft, lubricants to enable telescopes on satellites to work for ten thousand hours, and a quartz thermometer to measure lunar temperature to within one-thousandth of a degree Fahrenheit.
ADL has been described by a summer intern from the Harvard Business School as “a kind of kindergarten where everybody is playing with his own blocks or finger paints”; by one of its senior managers as “a crazy place that’s also a supermarket of expertise”; and by the chairman of its board as “a floating flea market.” It has described itself as “the last place on earth where private enterprise really works.”
Making fun of experts is a popular sport. A trade journal, Consultants News , has defined a consultant as someone who is “brought in to find out what has gone wrong, by the people who made it go wrong, in the comfortable expectation that he will not bite the hand that feeds him by placing the blame where it belongs.” A consultant also has been defined as someone who borrows your watch to tell you the time, someone who can tell you how to blow your nose better, and someone who knows a hundred ways to make love but doesn’t know any girls.
No doubt each of these definitions has its grain of truth, but it’s true, too, that a consultant may be someone who can turn a sow’s ear into a silk purse or can fly a lead balloon. The balloon of lead foil that was launched by ADL staffers on May 16, 1977, was last seen heading east over the Atlantic, at a height of four thousand feet.