Being a Few Facts About Herbert J. Daly

J. L. RUTLEDGE March 15 1920


Being a Few Facts About Herbert J. Daly

J. L. RUTLEDGE March 15 1920


Being a Few Facts About Herbert J. Daly


WHEN a man has shown a certain facility in getting any manner of work done and done successfully, the odds are, that there will be plenty of that kind of work thrown his way. There are a lot of people who want work well done, and have a very keen appreciation of how it should be done, who will turn work his way, because they have confidence that he will get it done according to specifications. There are an almost equal number of people who don’t know how to do it themselves, and know very little about how it should be done, and are only eager to bridge the responsibility. In either instance it is a case of “Let George do it.” So if you can locate “George” you will probably find one of the busiest people in the community.

The “George” in mind at the moment happens to be named “Herb”—Herbert J. Daly; but anyone who has watched him buzzing from one job to another, each succeeding job entailing more knowledge, more executive ability and more work, would recognize him at once as a typical ¡‘George,” the gentleman who is accustomed to doing things. He is an energetic gentleman, whose advancement has come through the appreciation of those who have seen his work. Having found the makings of a new real, eight-cylinder “George,” they were in no wise contented to let him escape. The only difficulty has been that, no sooner was he carefully sewed up in one job, than another one turned up, and somebody had to be sent out to page “George” once more.

Such has been the career of H. J. Daly.

At the age of 37 he is a director of three departmental stores that are among the largest in Canada, a director as well of sundry other important industries, ex-director of Repatriation and president of the Home Bank. Now it isn’t so much the importance of these various interests of his, though they are unquestionably important enough to warrant notice, but the simple fact that he arrived there at the age of 37, when the average young man is whetting his wisdom teeth with the idea of starting out to get a large and juicy bite of fortune.

Far be it from us to suggest that abomination of desolation, the precocious child. Daly wasn’t, isn’t and probably never will be a marvel, infant or otherwise. He had talents, not particularly more than the average, but he used what he had, and he eternally got down and dug for what he got. That’s why he got it, of course. It’s no secret. It’s anybody’s chance. Daly seized it, that’s all.

He Started as a Traveller

IF there is any impression that his first feeble gurglings were impeded by a silver spoon, such impression is wrong. He wasn’t born with the spoon. He has acquired it since.

He was born in Peterborough, Ont., and got his early education there and in Orillia, where he matriculated from the High School. There ended his academic education, and there his business-training started. His first venture was as a traveller for a wholesale grocery house in Quebec. Whether it was that he left too soon or that his admitted business acumen had not developed to any marked extent at that time, the fact remains that the business failed shortly after his departure. Peregrinating around among grocery stores he got the idea that strikes us all once or twice in a lifetime, that the grocer is in a fair way to make a fortune. Most of us resist the temptation to try our hands. Daly didn’t. He started a grocery store in Parkdale, Toronto. Again history is a little cloudy in regard to the details as to whether that grocery store gave a particularly rosy promise or not. Probably he hardly waited long enough to enquire. He sold out and went with the Dominion Permanent Loan Co. for a while; and, while there, made a devastating hole in his supply of midnight candles, by studying auditing.

It was round about this time that he noticed an advertisement of the National Cash Register Company for an office manager. What Daly didn’t know about office management was about all there was on the subject. However, he was never one of those to worry too much over problems before they had actually arrived, and he figured that it would be time to worry over the details, when they were sure enough to warrant worrying. So he dropped in and had his boots polished and started after that job. It

was a moment of some importance, for here, or hereabouts, was where the “George” part of his existence began.

The young gentleman in the office met him with an “And-what-can-I-do-for-you-my-young-fellow” look. That was disconcerting, for at the back of Daly’s mind was the thought that office management was a somewhat untried field in his experience. However, he asked for the general manager, and he saw him. He told what experience he could claim, what he thought he could do, and what he thought he couldn’t, the former items being very considerably in the preponderance. The manager liked him, liked his looks, and his very evident confidence, that, given the chance, he could look after the job. But the applicant hadn’t any experience behind him, and he was only a boy. The manager couldn’t just see it, and told him so in as kindly a manner as he could. Daly wasn’t discouraged. He hadn’t expected to get the place.

Daly Gets the Job

SEVERAL office managers were engaged at the plant after the Daly proffer had been rejected. They came and went. None seemed to suit. Finally there came a moment of desperation.

“Hang it all,” said the Manager, “where’s that chap Daly who applied for this job? He looks the likeliest fellow I’ve seen. Get hold of him, will you, and get him on the job here.” *'

So “George” came on the job. He stayed on that job till three years ago; first as office manager, then as factory manager, later sales manager and finally general manager for Canada.

It has been mentioned that this was the crucial point in his career; and clearly it was. Here he got his training, and his opportunity to test that training in actual operation; and here he came in contact with that unique business genius, John H. Patterson of The National Cash Register Company. Now while his association with the company is entirely ended the training that he obtained there is being put to work, and made to apply to a multitude of other interests; and the impress of some of the startling lessons taught by John H. Patterson still remains.

It may seem like a digression but here are a couple of instances of the methods Patterson adopted to teach a lesson. These and a thousand other instances caught the attention of Daly, and taught him to put the emphasis where the emphasis was due. John H. Patterson was

going through the factory one day at Dayton. Coming to one department he stopped.

“And now what is this department?” he asked.

“This is the costing department,” he was informed.

“Ah, yes. And how many men are employed here?”


“And what do you do?” he asked one of the clerks.

“Well, sir, I keep a record of costs on such and such a line.”

“Ah, yes, very good, very good.” "And what do you do?” he asked another. “I keep a record of labor costs.” “Very good, very good.”

And so he went on with his enquiries, apparently pleased with the result. Finally he turned to the head of the department.

“And, now,” he said, “we’ll get some trucks, and we’ll pile all these records on them and take them down to the furnace.”

And he did. What’s more he disposed of the whole department. It was John H. Patterson’s way of saying that the machinery had become more important than the product, that the equipment for doing the thing was interfering with getting the thing done.

it was a striking lesson, and not one that the employees of that company are likely to forget. Certainly Daly has not forgotten it. Machinery to achieve an end he believes in, but the machinery must be limited to the absolute needs, and not introduced for the sake of its shiny parts or the pleasant whirr of its wheels.

Not so many years ago, there developed in the company a feeling of antagonism between [the sales managers of the various districts and the executive officers of the company. There was nothing outwardly seen, just petty annoyances, petty irritations and some larger grievances that made the selling end feel that they were not being fairly treated. Patterson heard of the disaffection.

“Call them all in,” he said, “and let’s talk the matter over.”

They came to Dayton, and they talked. Two months later every one of the head executive officers, with one exception, was paid a year’s salary and dismissed. The sole survivor of that wholesale destruction happened to be H. J. Daly.

Where He Got His Training

npHIS dissertation regarding a particular firm is inter-*• jected, because no discussion of Mr. Daly can leave out of account the training that he obtained while associated with this firm. He frankly admits his indebtedness. He is ready to admit also that what measure of success he has had is due to training perhaps and hard work rather than to any phenomenal ability.

The company he was working for wanted to know, to know of the inner working of plants and Daly had a penchant for finding out. That suited everyone. He studied factories everywhere on behalf of the company. When he heard of any factory that seemed to have a new slant on any system of operations he went to visit it. By doing so he collected and arranged a wide variety of data on the operating machinery and operating systems and costs. This collected information became an asset for the company, but it remained an asset for Daly also, and one that has done a good deal to help him. A man who knows shop-practice and administration is worthy of consideration at any time. His investigations and later experience brought him other knowledge, an understanding of the sources, handling, and possibilities of the raw materials used by the company. He knew, in fact, a good deal that there was to know regarding steel and wood and brass and iron. He knew also something about the retail business, because not only had he been a retailer himself, but because, while he was studying factory management, he was also studying the problems of the retailer, large and small. And in addition to that he had, at least, a fleeting knowledge of the jobbing business from his brief sojourn as a wholesale grocery traveller.

Perhaps someone at this juncture will arise in his place to demand what all this has to do with the presidency of the Home Bank. Let us hasten along with the retort: It has everything to do with it, and was unquestionably one of the outstanding reasons for his appointment to that position. The good old days when the banks were institutions that stood more or less aloof from business, thought of themselves as institutions in fact instead of businesses, have passed away. Modern conditions have changed all that. The bank is interested in business because its own existence is tied up with the success or failure of modern commercial enterprise. The money it carries must be loaned in great_ commercial enterprises, and the security of these investments depends on the soundness of the business methods of the borrowing concerns. There you have the reason why the banks are more and more turning to those who have a real knowledge of business conditions; the main reason for the appointment of H. J. Daly as the president of the Home Bank.

Continued on Page 50

Continued from page 23

He Breaks In as a Specialist TT is impossible to trace exactly how H. J.

Daly made his first connection with the bank in question and this is unfortunate because the whole course of a very spectacular career hinges on that point. As far as the narrator has been able to learn, however,^ the connection came about gradually and was the result of certain sound theories that Daly held on business problems. He knew M. J. Haney, the then head of the Home Bank, and often had occasion to propound these theories in conversation with Mr. Haney.

“Business principles are the same in all lines,” said Daly. “It doesn’t matter whether you are running a bank or running a grocery store, making cash registers or publishing a newspaper; the same principles always apply. Acquire a grasp of the fundamentals of business and you can apply them to any kind of enterprise under the sun. Fail to acquire them and you’ll make a failure of anything and everything you touch, no matter how small or insignificant it may be. In the final analysis the president of a bank is, after all, doing just the same thing as the proprietor of a grocery store, except that he is applying the principles to different problems and in a much bigger way.”

Figure out the subsequent career of H. J. Daly and it will be seen that he has

proven his contention, for he has handled a great variety of things and the successes he has scored have been due to a close adherence to one set of ideas or principles.

Certainly it was partly on the soundness and originality of his viewpoint that Daly “sold himself” to M. J. Haney. The latter became convinced that the National Cash man would be peculiarly fitted to aid the bank in some of the business problems that confronted it. Through stress of circumstances it frequently happens that a business gets into the hands of a bank and it devolves on the bank to get the tangled affairs of such business straightened out. Only by revitalizing the concern can the bank protect its own investment.

A situation of this kind developed and the president called in Daly in a consulting capacity. The business required reorganizing. It was badly manned. It was as full of leakages as an old bellows and in all departments there was inefficiency :*xd overlapping. Daly’s method of getting at the weaknesses to be corrected was summed up in the first sentence he uttered when ushered into the room, where a group of bank officials had gathered to talk over the business patient:

“Get me a blackboard.”

Daly had learned the value of charts in the N. C. R. John H. Patterson believes that chalk is more effective than verbal explanation and every problem in that wonder organization is worked out by charts and diagrams. When a sales manager talks to his staff he has pencil or chalk in hand; the eye catches the idea more quickly than the ear. So Daly, who had been brought up on a business diet of chalk and charts, had a blackboard brought in and set up in front of the bank officials. Then he proceeded to get the internal organization of the ailing business down in a form that made each detail clear to the eye.

At the top he indicated the general manager. Immediately underneath he placed each department head. Under each in turn he worked out the ramifica-

tions of the business. Gradually, as the position of each employee was indicated, the whole organization took tangible shape and the men in the room were able to visualize the business as never before.

“Now,” said Daly, still busy with the chalk, “here we have the whole business, lock, stock and barrel. Each employee of the company is indicated and we can see where he fits in with the rest and how the different departments interlock. Now, we know that this organization is as leaky as a sieve and pretty inefficient all around, although there are plenty of able men in it. Let’s find out why.”

Without budging from in front of the board, they found some of the weaknesses. Certain necessary cogs were missing. It was seen why a certain department did not keep pace with another—a cog was missing, as the chart showed. Several instances of overlapping were found. The bank officials talked and Daly explained and chalked, visualizing the suggestions that came out in the course of the discussion. After a couple of hours they found that most of the weak links had been located and that practical plans for their correction had been evolved.

“Young man, that chart idea is a wonder,” said one of the bankers, getting Daly by the coat lapel as the meeting broke up.

“A wonderful man invented it, one John H. Patterson,” said Daly “It’s kind of second nature with all of us now. We can’t work out any problem without a

“I knew they used charts in certain lines of business,” said the banker, “but I never thought they could be used in banking.”

Enter the Department Store Expert

SO Daly sold himself solidly to the bank, partly on his own capacity for taking a system apart and finding its weak parts and then putting them together again, and artly on a new idea. With his chalk and is charts and his delightfully easy way of reaching a solution by sheer visualization, he impressed the bank as the handiest kind of a man to have around. After that, when the need for a man who understood business system arose, it was a case of, “Let Herb do it.”

And Herb did it. Three of the largest departmental stores in Canada came under his care, one at a time, and he applied himself seriously to the work of discovering and perfecting store systems. It is all very well to suggest that this hustling young fellow had sold himself to a big institution on the strength of showy methods and original ideas. Unquestionably there was more to it than that; and unquestionably when he buckled down to the serious tasks that the bank brought to him, it required a real genius for organization to make a success. In terms of the street, he “had to make

Daly studied departmental store problems with characteristic intensity. He dug right down to the roots of merchandising system.

“These big stores are a mass of intricate system,” he told a friend about this time. “If they didn’t have everything cut and dried they would break down quicker than any business I know. And yet they have a tremendous number of loose ends at that. Some of the really essential things are not checked up.

“For instance,” he went on, “they have no system of checking the marking down of goods. Every day goods are marked down; hundreds of thousands of dollars are marked off the price-tags in any one of these big stores in the course of a year and it’s done by the managers of the departments They use their judgment as to the value of the goods or take a chance on lopping prices to bring customers in. Do you realize the tremendous leakage in a business in the course of a year through haphazard marking down of goods?”

So, in course of time, a system was devised to systematize the marking down process. A department knew how much could be marked down just as it knew how much could be spent on advertising or display fixtures, and so it went._ Daly proved that his theory of fixed principles could be successfully applied to the departmental store business, for under his direction they unquestionably improved in organization and results.

In the meantime, of course, it had become necessary for him to devote himself entirely to this work and his connection with the cash register business had come to an end.

fANE of the stores in question was in y' Ottawa and he spent a good deal of time in that city; which was probably the reason for his going into the service of the Government of Canada. It is probable that his record as an organizer was responsible for his selection as Director of Repatriation but those who know point to one incident as the direct factor in bringing about that appointment.

Daly was called in as sole arbitrator in a dispute between the street railway employees in Ottawa and the company. They had reached an impasse and a settlement looked a long way off. A jointmeeting was held in the morning to discuss the case with the arbitrator and Daly’s opening remark on entering the room was his talismanic request :

“Bring me a blackboard.”

Then he produced chalk and drew a see-saw with one end elevated at a high

“Here are the employees,” he said, indicating the elevated end. “Away high —demands up in the air. Here,” indicating the lower end, “is the company— low, very low, offering the minimum. You’re so far away from an agreement that an arbitrator can’t do anything for

“Now,” he said, drawing another sketch, with the see-saw more at an equilibrium, “when you get things at about that angle, I’ll be able to discuss the situation with you. In the meantime, I’m useless here. You thresh it out between you and I’ll come back this afterrnoon.”

When he came back the position of the see-saw was closer to equilibrium. The men had come down, the company had come up. In the course of the negotiations that followed, it was not a difficult thing to reach an agreement.

He Becomes Director of Repatriation

WHETHER or not the potency of his mediation in this case convinced the Government of his fitness for the post, it is a fact that shortly afterwards, he was offered the important office of Director of Repatriation; and accepted it. It meant taking on the work as an added load, for he retained his interest in his other ventures. His work there is too fresh in the public mind to require any extended mention. In any case, there is little to tell about it. He went at it in his regular way, applying to the repatriation of Canada’s gallant soldiery the same principles that he had used in business. He organized his department quickly and effectively.

“This chap, Herb Daly, he must be a wizard,” said ¡one man at a Toronto club recently. “He must be working about twenty-four hours each day.”

“I’ll tell you what you do,” said the other party to the conversation. “Take a run up to the next floor and go into a little room in the corner—the card-room. You’ll see a rather quiet little chap in there right now, playing bridge. That’s Herb Daly.”

Yes, Daly was working hard; he always does; but he never lets himself become so immersed in his work as the public supposed. He can do about as much work as the ordinary man, and then can perhaps do as much again. But even this would not permit him to have a finger in so many pies, did he not have another system as well. Daly also “Lets George do it.” But he chooses his “Georges” with care.

He’s a Diagnostician

JUST a final word. He is a diagnostician. There are plenty of doctors who can cure a disease once they know what disease it is, but diseases are elusive things whether in the physical or the business world. Every business or industry is subject to them. Therefore, the man who can diagnose a business, who can tell just what conditions are provocative of danger, is a man of unusual gifts. Even the business that is sound in wind and limb, and progressing rapidly may present its problems for the diagnostician. Its activities may be showing improvement but falling short of the maximum achievement. This is the work of diagnosis. Business diseases are not difficult of remedy once the flaw is discovered. There are plenty of able business executives who yet lack this quality of scientific investigation. Daly has that quality. It is a combination of training, hard work and a naturally keen mind. The man who can analyze a situation can master it, and that is what has given Daly his chance.