Neil McElroy

neil mcelroy

Neil McElroy

(1904 - 1972)

He stood six feet four inches tall. His frame was large, but he moved swiftly. When in Washington a circle of reporters hemmed him in and he decided to leave, he bowled over a reporter or two as he strode through the human barrier. The Washington press corps was furious, and he later apologized; but he had said he was leaving, had set himself in motion, and they just didn't understand that they'd better get out of the way.

These characteristics - magnitude, speed, clear purpose and drive - exemplified his business and community activities as well. His apology also was characteristic: it wasn't long before he was a favorite with the media.

There was a period, roughly 1940 to 1965, when if there was something to be done in Cincinnati, McElroy was the man one went to.

Born in Berea, Ohio, near Cleveland, on October 30, 1904, he was reared in Madisonville, where his father was a high school physics teacher and his mother a teacher in the grade-school. By mowing lawns, shoveling snow, wrapping bundles in a laundry and working in a can factory, he saved enough money to pay his way to college, with the help of a $1000 scholarship from the Harvard Club of Cincinnati.

On graduation from Harvard College with a BA degree in 1925, he took a summer job with the Procter & Gamble Company; he wanted to earn enough to enable him to attend the Harvard School of Business Administration in the fall. His job was distributing door-to-door samples of Camay, a toilet soap then being introduced. An alert crew manager spotted the likely lad and told the advertising department they'd make a mistake if they let him get away. He was persuaded to give up his plans to go back to school, and he took a job as mailboy in the main Company office. There, as he said later, he "learned the business by reading other people's mail." He was soon taken into the Advertising Department.

In the archives of P & G is a memorandum which did much to change the structure of marketing in the United States. It was written by the young McElroy, a fledgling in the advertising department. R.R. Deupree, then Company president, had the idea of developing brand units, a separate team planning, creating and directing the marketing effort for each product, something that came to be known as the 'brand man' concept. He selected McElroy to develop it; but McElroy enlarged the concept and took it a step further. He learned that the policy under consideration for the advertising and marketing of the new Camay was: it must not be allowed to hurt, or to compete too directly and vigorously with, Ivory Soap. Wrong, said McElroy: each brand must project itself to the maximum, compete as toughly with the competitor inside the company as with those without. No one, he said, is going to limit the energy of competitive brands like Lux Toilet Soap or Palmolive; Camay must have no shackles. Each brand must stand on its own feet. Today this policy, revolutionary when it was conceived and articulated by young McElroy, is a standard principle in the marketing of nearly every consumer product in America, from crackers to automobiles.

Establishment of the Brand Man operation did not come easily. One of the most difficult problems McElroy faced when he first took over the Advertising Department was that the Sales Department was completely dominant at the time - and "looked at the brand men as a bunch of young college boys who were just fiddling around," as W.L. Lingle, a new young brand man of that period and later a Company executive vice-president, put it. "They often couldn't sell their ideas to the Sales Division Managers. Neil was awfully good at developing the brand men and getting them accepted. 'You go and see if you can't sell it,' he would tell them; 'if you can't, I'll come in and help.' "

The success came from careful recruiting and insistent training. When McElroy took things to Deupree, then president, to clear them he would discuss the matter first, then leave with Deupree a brief, clear written memorandum. McElroy insisted that these be properly done. One of the brand men speaks of being asked to rewrite one five times and then, with some impatience, asking, "Why didn't you revise the first one yourself, then you'd have had it the way you want it?" McElroy's answer: "I could have done it the first time; I'm going through all this so you'll learn how to do it."

McElroy's rise through the company was steady and inevitable. McElroy had caught the eye of the top management, and when, in 1930 P & G had acquired Thomas Hedley & Co., Ltd. in England, and needed someone to run the whole marketing operation, McElroy was sent abroad for the job.

He was on the way up. In 1943 he was placed in charge ofP & G's advertising; in 1946 he was made vice-president and general manager of Procter & Gamble; and in October, 1948, he was made Company president. He was a few months shy of 44 years of age.

Under McElroy's administration many of the developments that shaped today's P & G took place. Among the principal ones:

Major emphasis on training, the development of managerial competence. "Neil was far and away the man in the business who was most interested in developing new talent," says Jake Lingle, one of his associates in top management; "he put responsibility on the men down the line." He quotes McElroy saying "the business can grow only as we have people who can do the job. The most important job you have is training the men working for you."When Deupree moved from the CEO role as president to become Chairman of the Board there was really only one - Neil McElroy - who was capable of being his successor; when McElroy was called to Washington in 1957 to become Secretary ofDefense there were three or four men who had been trained for top management and were capable of taking over the Company presidency.

Drastic expansion of the Company's product line. With the purchase of 560,000 acres of pine land in Florida, the Foley operation (dissolving pulp) took on a new magnitude. . . and the pulp business led naturally to consumer paper goods. The Charmin Paper Company was acquired in 1957 and P & G's extensive paper products business was launched. The acquisition of a Lexington, Ky. peanut butter plant, and later of Duncan Hines cake mix and Folger Coffee, led to the Company's being a leading element in food products. The toilet goods business, a small stepchild before the war, became a major factor. While major expansion into these fields was achieved under Howard Morgens, McElroy's successor, it was initiated under McElroy.

The development of the International business, today a major part of the Company's volume and profit. The previous management had shied away from gearing up for business in Europe: repeated wars made plant investment there risky. McElroy saw it differently, and started the expansion that carried P & G world-wide.

The development of the Brand Man. Prior to McElroy, the only coordination of the various elements of the Company's operation was at the very top level. The Brand Man concerned himself with all aspects of a product - product characteristics, consumer testing of the formulation, design and content of package, pricing, market testing, advertising, sales promotion, success or failure. Through persuasion and clear competence, and with the President's confidence in the system, he (and to an increasing degree, she) was able to steer all aspects of the brand's marketing. Without this organizational structure, the success of a company with fifty or more brands would have been conjectural. Furthermore, because of the breadth of experience involving all facets of the Company operation, the Advertising Department became the source of many of the Company's top executives.

The commitment to research. Under him the Company built the first in a group of major facilities devoted entirely to research, the Miami Valley Research center, with heavy emphasis on basic research. With him, research was a fundamental part of P & G's operation.

Of great importance: the development of heavy duty synthetic detergents. In the report to shareholders at the Company's annual meeting in 1947, Mr. Deupree said, "There is small chance of synthetic detergents replacing soap products to any marked extent." (Asked about this in 1956, Deupree, in his characteristic outspoken fashion said, "I was wrong" - and gave credit to others for pursuing ~etic detergents with vigor). Under McElroy the devdopment,at times discouraging, was pursued, and the market broken open. Synthetic de- tergents provided the key to opening up the international market, and gave the Company an unapproachable lead in the laundry business in the United States.

Procter & Gamble had a tradition of public service - and McElroy soon took a leading position in the community.

In the early 1940's Alfred Bettman, chairn1an of Cincinnati's Planning Commission, was pressing for a major revision and 7updating of the Master Plan of 1925. He was meeting with little success, and enlisted the help of a handful of influential citizens. They decided to forn1 an organization of the very top businessmen of the community, to be called the Citizens Planning Committee, to push for a new Master Plan. In this group were Stanley Rowe, co-founder of the Shepard Elevator Co., and Fred Geier, president of the Cincinnati Milling Machine Co.; they called on RR Deupree, then president of P & G, and asked him to be president of the new organization. He declined, said he'd help raise money and give full support; but, he said, you couldn't do better than enlist my young colleague, Neil McElroy. Neil quickly took on a key role, and soon became president of the Committee.

The Master Plan was greeted with howls of protest. Many were the vested interests which felt threatened. Many property owners labeled the plan 'pure Socialism' trampling on property rights. But with strong support from the CDC, the Cincinnatus Association, the Chamber of Commerce and others, the Master Plan was officially adopted in 1947.

At that time, McElroy was a prime mover in the establishment of a successor organization, the Citizens' Development Committee. The CDC's first mission was to ride herd on the Master Plan - observing how it was implemented, and helping in three specific ways: keeping the political situation in line, making certain sufficient funds for the plan's execution were available through the issuance of bonds and the passage of levies, and pushing for needed legislation at the city, state and federal level.

For many years, the CDC had a major influence on City affairs; it was a vital factor especially in the major decisions affecting Cincinnati's development. McElroy was one of its leaders.

In 1952 the annual drive of the Community Chest had for several years failed to meet its goal - and its goal reflected actual need. McElroy was asked to take the chairmanship of the campaign. He agreed to do so on two conditions: that there be a co-chairman, and he asked for Joseph B. Hall; and that there be a clear understanding that the goal was going to be reached. He would not accept failure. That year the goal was reached, and the campaign was put on so sound a footing that as of the year 1988 it had never failed to reach its goal again.

This led to another example of McElroy's effectiveness: the merging of the Cincinnati chapter of the American Red Cross and the Community Chest to form the United Appeal. The Red Cross had been having a major fund-raising drive in March, the Community Chest in October; they were using much the same people as campaign managers and solicitors. McElroy was head of the Red Cross drive in 1950, and of the Community Chest drive in 1952. He started pressing for a merger. Red Cross resisted: they were concerned about their autonomy, and the loss of identity. But after many conferences, and much persuasion, at a May, 1955 meeting of the two groups in the P & G board room agreement was reached to join in a single fund-raising program, the United Appeal. The arrangement, unusual in that one was not absorbed by the other but each was accepted as a partner, has been regarded nationally as a highly successful model.

McElroy's close relationship to the Red Cross was helpful in another connection. P & G's General Offices had outgrown the space in the old Gwynne Building at Sixth and Main. A new office building was needed. The possibility of moving the corporation's headquarters to New York was considered; the planes and trains were full each week of P & Gers going to New York, to work with the four New York advertising agencies the company was then using, among other things. Another possibility was to move to the countryside. It was a time when America's inner-cities were decaying; more and more businesses were pursuing the 'flight to the suburbs'. McElroy and Morgens were among the business leaders resolved that this would not happen in their city. The decision to build in downtown Cincinnati was hailed as a major strengthening of the inner city, and as a vital stimulant to further development of the downtown area. "It was," says Nelson Schwab, Jr., Cincinnati attorney and one-time president of the Chamber of Commerce, "one of the key factors in making Cincinnati's downtown what it is today."

The most attractive piece of property was the block on Sixth between Sycamore and Broadway, and one of the occupants was the Red Cross. P & G found a new site for them, bought the property and gave it to them; a group of anonymous donors provided funds to build the new Red Cross building, and the exchange was completed.

In short, for a decade or two Neil McElroy was one who could quietly marshall the resources of the business community behind causes of civic importance, and did so in a dozen or more instances.

Nationally he was a member of the Business Council, a director of The Atlantic Council of the United States, Inc., and a former chairman of the National Industrial Conference Board. He was on the boards of the General Electric Company, Chrysler Corporation and the Equitable Life Assurance Society.

But his chief interest was in education. He was a director of the Council for Financial Aid to Education, and at P & G launched one of the nation's outstanding programs of aid to colleges and universities; he was a trustee of the National Fund for Medical Education, a sponsor of the United Negro Colleges' capital fund campaign, and chairman of the University of Cincinnati's College of Medicine. He was a prime mover in the program of the National Citizens Committee for the Public Schools. Always active in the affairs of Harvard University, he served in many capacities, among them as President of the Board of Overseers.

As Secretary of Defense he was asked to submit to a taped interview to be part of a symposium on private independent colleges. With no preparation, he gave in a four or five minute statement his views on college education. Later a man who was present said, "I have worked closely with three presidents, and with some twenty or thirty cabinet members. I am certain not one of them could have made the kind of thoughtful, broad-gauge statement on education Secretary McElroy has just made."

Therefore when in 1954 President Eisenhower was looking for someone to be chairman of a White House Conference on Education, he kept running into McElroy's name. He asked Oveta Culp Hobby, then Secretary of Health, Education and Welfare, to contact him. McElroy, characteristically, sought assurance a) that he would have the full support of Hobby's department, and b) that this was something of genuine interest to the President, and not mere window dressing. Assured on both points, he took on the assignment - and his performance was such that President Eisenhower said to one of his aides, "Keep him in mind. He's a man I want to use in government one of these days."

That day carne early in 1957, when he was asked if he would accept the position of Secretary of Defense. Again, McElroy considered it carefully. But there could be only one answer: "You don't turn down the President of the United States when he wants you to do something for the country."

McElroy took office as Secretary six days after the Soviets launched the first object in space. This evidence that the USSR was well ahead of us in its space program - which meant by implication in its ballistic missile weaponry program - created near panic. A special investigative committee under Lyndon Johnson, majority leader of the Senate, devoted full time to critiquing the Department of Defense; the media were clamoring for someone to blame. The pressure to get our own object into space, to bolster our research program, to improve our schools, to strengthen our sciences, was enormous. And much of it was on McElroy.

His response was characteristic: by November 20, 1957 James Reston, then head of the Washington Bureau of the New York Times, was writing in his column, "McElroy is proving to be the most attractive new personality to hit Washington in a long time. Although he has been here only six weeks, his name is already being added to the long list of Presidential possibilities for 1960." He went on to comment on "how quickly he had established his authority over the three services" and "his surprising command over the intricate details of the missile program and the Pentagon's complicated administrative machinery."

McElroy was the right man for the Defense program at that critical time. For one thing, many people needed calming down, needed reassuring, needed new confidence. No one had a better intuitive sense for people; no one could have handled better than he the members of Congress, the special investigators brought in to master-mind his job; the press with its voices of alarm, and the military services, each seeking independently to solve the problem single- handedly. For another, the future of space weaponry was in trouble partly because his predecessor had no interest in research and was especially opposed to the kind of basic research needed for the development of the complex weapon systems of today. ("What do I care what makes the grass green?" Charles Wilson had said). No one could more quickly and with greater understanding have put together almost from scratch a research program that soon brought major rewards in national security.

He was Secretary for a little over two years. With his guidance or assistance, NASA was formed, a new research and development authority was established and functioning, our intercontinental ballistic missiles were nursed through many failures to operational success, our level of defense expenditures were brought to a level necessary for national security, the department was reorganized in an attempt, largely futile, to diminish interservice rivalries, and the nation was restored to an attitude of confidence. On his leaving the Defense post President Eisenhower awarded him the Medal of Freedom for outstanding service to the country.

On returning to Procter & Gamble in December, 1959, he was made Chairman of the Board, and in 1971 Chairman of the Executive Committee of the Board. His position was a somewhat awkward one. Howard J. Morgens had become president on McElroy's departure for Washington on leave of absence; Morgens had done an excellent job, the Company was being well managed; McElroy's role was not crystal clear. His health had begun to decline not long after leaving Washington, and he retired from the Company's Board in 1972. He died later that year. His wife, the former Camilla Fry, followed a few years later. He had a son, Malcolm Neil, and two daughters: Barbara Sue ('Bitsy'), who married Lee Folger in Washington; and Barbara ('Bobby'), married to David Dimling of Dayton, Ohio.

McElroy was a rare combination of a hard, clear, disciplined mind and a warm, considerate outgoing personality. "Without question he had as fast and quickly reactive a mind as I've ever run into," Lingle commented. Those who worked with him knew him as a firm taskmaster. His standards were high. But he was never too busy for the little thoughtful 'extra'. His hearty greeting, his quick pleasantry, made hundreds of people, from parking lot attendants to heads of state, regard him as their friend. And he felt that he was.

He had unusual sensitivity. Three examples:

In the late '30's there were only two offices on the Advertising Department's floor in the old Gwynne Building, those of Ralph Rogan, Advertising vice- president, and William G. Werner. Werner handled media, copy, public relations. McElroy had a desk just outside Rogan's office, and handled the other aspects of marketing and promotion - and was clearly on the rise. As important matters shifted more and more to McElroy he was extraordinarily careful of Werner's feeling, never went to Rogan on a major matter without covering the subject with Werner.

As McElroy was taking over more and more the reins of the advertising Department and Rogan was still advertising vice president but spending a good deal of his time in Florida, McElroy would excuse himself at a party and phone Rogan long distance to report decisions that had been made or were about to be made - to give the older man a feeling of managerial participation. Early evening happened to be for Rogan the best time for the call.

When he took over from Charles Wilson as Secretary ofDefense he reversed many of Wilson's recent decisions. He phoned Wilson, explained that the launching of Sputnik had changed the situation greatly, and said, "Charlie, if you were here in this job today you would make the same decisions I have." He spoke to the older man with deference and affection.

He was an extrovert. He loved people, met them ebulliently, and with charm. He had the gift, as Lingle put it, "to make everyone he spoke with feel 'McElroy really was interested in me more than in anyone he's ever met.' " His ability to meet people once and greet them by names years later was extraordinary. He carried it a step further: he had a file of index cards on which were noted a few facts about people he'd met; when he was going to a gathering which one of these would be attending, he would run through the cards, fix a few facts in his mind, so he could be more personal in his greeting.

McElroy exerted leadership in business, in government and in community service. He appeared three times on the cover of Time magazine, twice for a P & G story, once as Secretary of Defense. Time summed it up: he was, Time said, "one of the most public-spirited business men in the country."

(With permission of the author.)