“The life and soul of the business is its honor.” – John Wanamaker

On December 14th, 1922, the schools and courts of Philadelphia closed early.  Likewise, the City Council adjourned, the Pennsylvania Military College suspended classes for an hour, and the Stock Exchange suspended  trading. All of that premature cessation of activity was done to pay respect to John Wanamaker, whose body was being laid to rest in the Wanamaker crypt in the burial ground of the Protestant Episcopal Church of St. James the Less.

It’s difficult to imagine this happening today.  When Sam Walton died 70 years after John Wanamaker, there was no such fuss, which is probably the way that Walton would have preferred it.  He was, after all, famous for driving sub-compact cars, flying coach, and staying with store employees on his trips.

In honoring Wanamaker though, Philadelphians were spot-on. Wanamaker wasn’t just another wealthy capitalist – his innovations created fundamental changes in mercantilism.  Wanamaker’s legacy included:

  1. Corporate training – cited by Lena Harvey as providing the first internal school
  2. Truth in advertising – Wanamaker was devout in being truthful – which was somewhat novel for advertising of the day
  3. Department Store – Wanamaker purchased an abandoned railroad depot and converted it into ONE of the first department stores. While not THE first to do so, he was possibly the first to go on and create a chain of stores.

In the absence of the business schools of today, and in order to train employees, Wanamaker created his own school, “The American University of Trade and Applied Commerce. GE, IBM, and other large corporations do this today, but at the time, it was a new concept.

Many of Wanamaker’s policies still seem enlightened by today’s standards:

  1. A service exactly opposite to the ancient custom that the customer must look out for himself.
  2. A kind of storekeeping absolutely new in its ensuring protection from wrong statements, printed or spoken, ignorant or willful, in reference to origins of merchandise, their qualities, and actual values.
  3. An elimination of so-called privileges to customers, as privileges when they border on humiliations, because hospitality as well as the return of goods for refunds or reclamations are rights that spenders of money are entitled to as rights not as favors.
  4. Recognizing and practicing the manifest, though unwritten law, that customers are entitled under our system to the maximum of satisfaction at the minimum of cost for the reason that they pay the usual and ordinary expenses of storekeeping, which are always included in the price of merchandise.

The “Golden Book of the Wanamaker Stores” also spells out very clear expectations and rights of employees, organizational values, and vision.

Elias St. Elmo Lewis argued that having such a clear vision was fundamental to efficiency because, “it has taught the discipline that made the (…) employee who understands what is wanted…”

Wanamaker was not loved by all.  Besides his great department stores, he was the US Postmaster General under Harrison, and dabbled in politics and opinion-making of all sorts – and you can’t do that without making your share of distracters.  His innovations in mercantilism and advertising, however, have left their imprint on business to this day.  He was also often derided for making much of his own piety and Christian ethics.  But it was that very strong fervor of religious belief that Wanamaker used to create an ethos and set of values by which he managed his company.

Today,  having established values is a key component to organization development, along with having a mission and vision.  Of course, not all of the great entrepreneurs of American history had strong values – or at least not in an apparent way. Rockefeller and Carnegie were both religious men, but they did not use their beliefs as guiding principals for running their companies.  Wanamaker’s beliefs sound like the very blueprint for Zappos:

Wanamaker would later extend his money-back guarantee to cover clothing that had been altered by his tailors, and so presumably could not be resold.  He was the first merchant to do this, taking the risk that few sukch garments would be returned, while the expense of the goodwill engendered by the gesture could be written off to advertising. (-Robert Sobel, The Entrepreneurs)

Robert Sobel, the author of the passage above, makes the case that while Wanamaker was indeed a pioneer, he missed many opportunities of dry-goods hegemony, often due to his reluctance to share control with others and his inability to see some major changes in the wind. He was by no means the model leader.  But it could be that his imprint is not so much whether he was the first this or that, but that he created his business from his sense of morality.  And agree with that morality or not, it became a force that helped shape American business.

This entry was posted on Sunday, April 3, 2011 and is filed under Digital Advertising.

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