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Up in Smoke. Gradually, the Gambles drifted out of company operations;- the Procters, a cool and quick-thinking breed of businessmen, carried on. One day second-generation President William A. Procter was lunching at his club in downtown Cincinnati when a messenger brought word that the factory was on fire, and P. & G.'s vast warehouse supplies of fats and oils were going up in smoke. Instead of rushing to the scene of the disaster, Procter went to the telegraph office, dispatched wires and cables to the oil markets of the world, bought all the oil futures he could. Not only did he thus avoid a squeeze at the hands of speculators but he had plenty of raw materials on hand when P. & G.'s new plant, Ivorydale, opened in Cincinnati's suburbs.
The forward-looking Procters knew how to take care of their employees as well as themselves. They pioneered (1887) in profit sharing, and last year P. & G.'s employees got $8,000,000, or 8.7% of total company profits before taxes. Colonel William Cooper Procter, third-generation boss of P. & G. and a leading Episcopalian layman, had a still more modern idea. For years P. & G.'s production had fluctuated with the buying whims of wholesalers. If the wholesalers thought prices were heading higher, they loaded up; if prices seemed to be going down, they cut back sharply, and hundreds of P. & G. employees would be laid off. Colonel Procter reasoned that soap output should be governed by actual consumption of soap, a fairly constant factor.
Procter forthwith cut down on outside middlemen, and by setting up a network of P. & G.'s own distributors, flattened out the peaks and valleys. In 1923 P. & G. installed its guaranteed-employment plan, first of its kind in the U.S., and assured hourly workers 48 weeks' employment a year. In those days, such advanced management methods were nothing short of revolutionary. Today, they are considered a normal part of labor relations at P. & G. They have cut employee turnover from 133.7% to less than 1% a year, kept the company unhampered by outside unions and major strikes,, and left it free to concentrate on its main job of selling. P. & G. treats its top men with equal generosity. President McElroy, who started out with P. & G. as a $100-a-month clerk 28 years ago, now earns $240,000 a year.
Economics, Bridge & Poker. Neil Hosier McElroy was born in Berea, Ohio, on Oct. 30, 1904, and raised in Madisonville, a suburb of Cincinnati, where his father was a high-school physics instructor, his mother a grade-school teacher. It was a strict Methodist household, but father and mother McElroy sensibly decided that if their three sons were to learn the ways of the world, they might as well do so at home. Instead of having their boys hanging around the local pool hall, they installed a pool table of their own. On Sunday evenings the family gathered for a weekly concert, with mother at the piano, the boys playing the clarinet, flute and French horn, and father McElroy singing.