How George M. Verity's Corporation Produced True Steel
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Published June 9, 2021
Updated February 8, 2022 |
20th Century Definition of True Corporate Steel: Organizations where employee engagement, passion and enthusiasm provide the necessary tensile strength to withstand competition, recession, and depression.
Producing True Corporate Steel in the 21st Century
- Introduction
- B. C. Forbes' Humanizer of Industry Award
- The Author's Opinion
Introduction
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When Ida M. Tarbell wrote The Life of Elbert H. Gary about the chief executive of the United States Steel Corporation, she described it as the only time in her life when she considered herself truly “courageous.” This was from the woman who, over a period of years, challenged the business practices of the Standard Oil Company and John D. Rockefeller Sr.—at the time, the most powerful man in the country, inside or outside of government.
Her articles shone a light on the predatory, monopolistic business practices that contributed to the government bringing Rockefeller’s company to heel. Unfortunately, she also knew that to write anything positive about anyone in the railroad, oil or steel industries was to incite personal animosity, criticism and bigotry, because the public knew that there were no good men in leadership positions in these abhorrent industries. [Footnote #1] |
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So, she initially resisted writing the biography of Judge Gary [read review here]. She accepted the task only after he gave her full access to any information and any individuals needed to write a factual accounting. Judge Gary’s openness won her over, but she was roundly criticized.
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She appears to have been most affected by an article in her favorite newspaper entitled, “The Taming of Ida M. Tarbell” [see sidebar].
It seems the public and her peers had typecast Miss Tarbell as a muckraker: a person who should seek out and only focus on the evil in a thing. Miss Tarbell saw it differently. She felt that the muckraking profession had replaced individuals who had a “passion for facts,” with publications which had a “passion for subscriptions.” So, she broke the muckraking mold. It seems, though, that there were at least two honorable steel men: Elbert H. Gary and George M. Verity. Ida Tarbell wrote Judge Gary’s biography in 1925, and Christy Borth picked up the challenge to write George Verity’s biography, True Steel, which went to print in 1941. It is only in last few pages of the last chapter that Christy Borth reveals the meaning of the title of his book: |
"His [George M. Verity’s] chief pride lay in the fact that, in more than forty years, misunderstanding between management and men had not cost his company one ounce of lost production nor his men one cent of lost wages. … He achieved the distinction of having made steel without strife. It is a rare distinction. … That it has been done in—of all places—the steel industry, which has furnished all too many dark and sordid chapters in industrial history, seems to indicate that there may be many additional possibilities … to produce true steel by alloying honesty with iron [emphasis added]."
Of any industry, the steel industry and its associated businesses experienced open warfare between labor and capital. Yet, B. C. Forbes presented the “Humanizer of Industry” award to George M. Verity for his leadership of the American Rolling Mill Company (Armco).
B. C. Forbes in his day enjoyed breaking molds too.
Of any industry, the steel industry and its associated businesses experienced open warfare between labor and capital. Yet, B. C. Forbes presented the “Humanizer of Industry” award to George M. Verity for his leadership of the American Rolling Mill Company (Armco).
B. C. Forbes in his day enjoyed breaking molds too.
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B. C. Forbes' Humanizer of Industry Award On July 4, 1940, B. C. Forbes spoke to 15,000 residents of Middletown, Ohio while presenting the Humanizer of Industry award to George M. Verity. He said:
"It is very fitting that this little celebration should be conducted on Independence Day. We hear a lot about independence, but, without economic independence, we can’t enjoy any other kind of independence long. In other words, the man who is out of a job does not feel very independent. You are extremely fortunate that there came to your midst 40 years ago a man of such talents and such business ability. "Yes, he has done a great business job, but he has done something far more important than that. He has shown an example to all other employers throughout the country as to how folks should be treated." [emphasis added] |
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In a meeting after the award ceremony, B. C. Forbes told a group gathered at Mr. Verity’s home:
"I don’t think I need to remind anyone here that the steel industry has had a particularly unsavory reputation for having been headed by tough babies. I’ve known most of the heads of this industry personally. Seeing you workmen in this [George Verity’s] home, I’ve been thinking how utterly unlikely such a gathering would have been in the homes of some of the autocrats I’ve known.
"I don’t think I need to remind anyone here that the steel industry has had a particularly unsavory reputation for having been headed by tough babies. I’ve known most of the heads of this industry personally. Seeing you workmen in this [George Verity’s] home, I’ve been thinking how utterly unlikely such a gathering would have been in the homes of some of the autocrats I’ve known.
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"Ever since I started Forbes’ Magazine, I’ve striven to show industrialists the value of the line of conduct typical here. At the masthead of every issue I’ve put the biblical admonition: 'With all thy getting get understanding.'
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" If only fifty-one per cent of the nation’s industrialists could learn the value of the Verity formula, and apply it, we should not have to fear for the future of America."
American Rolling Mill Company was a part of the despised steel industry, but according to Mr. Forbes and Christy Borth, George M. Verity, his executives and the men they worked with rose above it all.
But are our 21st Century chief executives rising “above it all?”
American Rolling Mill Company was a part of the despised steel industry, but according to Mr. Forbes and Christy Borth, George M. Verity, his executives and the men they worked with rose above it all.
But are our 21st Century chief executives rising “above it all?”
The Author's Opinion
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The question this author has is this: “Should we fear for the future of America when we look past the promising words and analyze the actions of some of America’s 21st Century chief executives?” What percentage of our chief executives are guided by a concept within their corporations as simple, applicable and, yes, spiritual as The Golden Rule?
Perhaps the answer is found in the rhetorical questions that B. C. Forbes asked in his column the month after he recognized George Verity:
The editor of Forbes asked the right questions eight decades ago, and, at the time, he recognized three men as having found the right answers: George F. Johnson of Endicott Johnson Corporation, George M. Verity of American Rolling Mill Company [see sidebar], and Thomas J. Watson Sr. of International Business Machines Corporation. [Footnote #2]
Does IBM still have the right answers? |
The performance of IBM’s 21st Century chief executives suggests not, or as George M. Verity describes in the sidebar above" the corporation hasn't had the proper corner office "management" to ensure that "the investor's cigar is properly lit."
Here are a few examples at IBM:
Will we wait for the next economic downturn to find out?
That seems so … nineteenth century, doesn’t it?
And so foolhardy.
Here are a few examples at IBM:
- Read about IBM resource actions
- Visualize IBM's 21st Century benefit reductions
- Read about IBM investing in paper instead of people, processes and products
- Read about an IBM work slowdown
Will we wait for the next economic downturn to find out?
That seems so … nineteenth century, doesn’t it?
And so foolhardy.
[Footnote #1] On May 15, 1911, The U.S. Supreme Court ordered Standard Oil Company dissolved within six months. On July 31, the company made public its plan for dissolution to take effect on December 1.
[Footnote #2] B. C. Forbes wrote, “I can still see Tom Watson surrounded, at the lunch hour, by a crowd of his workers. It began by one employee, who spotted him, shaking hands with him, on the sidewalk in front of one of IBM’s factories. Soon others assembled. There was a continuous hand shaking, talking, fraternizing.”
[Footnote #2] B. C. Forbes wrote, “I can still see Tom Watson surrounded, at the lunch hour, by a crowd of his workers. It began by one employee, who spotted him, shaking hands with him, on the sidewalk in front of one of IBM’s factories. Soon others assembled. There was a continuous hand shaking, talking, fraternizing.”