Profits in Paper Pushing

Few statements have more power to depress the average U.S. businessman, beset as he is by a daily avalanche of forms, reports and correspondence, than the late "Engine Charlie" Wilson's axiom that "nothing takes place in the world of government or business that is not motivated by a piece of paper." Every repetition of this dictum, however, brings a beatific smile to the face of bulky, deliberate Milferd Aaron Spayd, 61, of Dayton, Ohio. Thanks to U.S. industry's ever deeper entrapment in paperwork, Spayd's Standard Register Co. has surged from onetime bankruptcy to buoyant prosperity as one of the nation's largest manufacturers of business forms.

Last year more than a million miles of paper rolled through the presses at Standard Register's five U.S. plants, winding up as everything from Miami traffic tickets to Wisconsin marriage certificates.

Standard's particular specialty--business forms printed in continuous rolls with holes punched at regular intervals down each side--spin through the high-speed printers of almost every major U.S. corporation. All this gave Standard 1961 sales of $58 million and profits of $3,100,-ooo. And this year things look even better: reporting record first-quarter sales of $16.8 million, Standard has just split its stock 2-for-1 and increased its dividend 14% (to 80-c- a share).

"Smallpox Paper." Standard's success still rests squarely on a half-century-old invention by a Dayton tinkerer named Theodore Schirmer. Watching retail clerks make out sales slips one after another on a hand-cranked device, Schirmer noticed that the carbon copies often slipped out of alignment. He solved the problem by ringing both ends of the machine's rollers with sprockets that engaged holes punched along the margins of the forms and thus held all copies firmly in line.

In 1912 Schirmer set up Standard Register in partnership with a Dayton business broker named John Q. Sherman. Within a year the infant company was in receivership, and Schirmer had sold out his interest to Sherman and his brother William. For a long time, Standard seemed doomed to the small time, even though the Shermans developed ways of converting the punched margins to typewriters and other business machines, competitors contemptuously dismissed Standard's punched forms as "lace panties" and "smallpox paper." Curfew at Midnight. During the Depression, Standard turned the corner by deciding to concentrate on producing specialized business forms--which now account for 96% of the company's gross.

And to step up sales, the Shermans hired Milferd Spayd, a ball-of-fire sales planning manager for General Motors' Frigidaire division.

Spayd became president of Standard in 1944, following the death of both Sherman brothers. He built up a hard-hitting, 750-man sales force whose members were chosen for their love of selling, and then stuffed full of technical data. At the company school, a hilltop mansion outside Dayton, all new Standard salesmen are given classroom training in business forms design, office systems analysis and paperwork simplification. The trainees live in isolation at the school, where the front door is locked promptly at midnight.

Core of the Standard brand of salesmanship is service, backed by a research budget of $2,000,000 a year and a staff of 142 engineers. Though the basic principle of the sprocket aligner is unchanged, Standard regularly redesigns its accessories to suit new and speedier business machines. Five of the company's engineers are on constant tour helping salesmen to work out customers' problems. If none of the 50,000 sample forms in Standard's files suit a customer's needs, the company's staff of 36 designers will create a new one. To show customers how their problems can be solved before spending a dime on equipment. Standard has set up a complete display of paperwork and data-processing systems in its Dayton headquarters. This free "simplification service," says Spayd, has saved a single customer as much as $750,000 a year in typing costs alone.

Aiding the Ignorant. As Spayd sees it, U.S. industry still does not appreciate the immense possibilities for cost cutting in its paperwork. "With Government reporting demands," he says, "the production of the office has approached the production of the plant. But the average top business executive, trained in production or sales, is still ignorant about office systems." By helping to eradicate that ignorance, Spayd predicts, Standard Register will grow by a solid 8% to 10% each year for at least the next five years.

This file is automatically generated by a robot program, so reader's discretion is required.