FORTUNE MONEY IN THE WASTEBASKET

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78-04718A002700210011-9
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 7
• Document Creation Date: December 9, 2016
• Document Release Date: August 2, 2001
• Sequence Number: 11
• Publication Date: February 1, 1953
• Content Type: MAGAZINE

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February 1953
Money in the Wastebasket
Reprinted through the courtesy of the Editors of FORTUNE
COPYRIGHT 1953 TIME INC.
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Are you and your staff buried in paper
work? Are files of worthless papers clogging
up high-cost office space? Are you wasting
money on microfilming? This article shows
how some managements are cleaning house
with estimated savings up to $100,000 a year.
Money in the Whstebasket
A clean-topped desk has long been the symbol of American
executive efficiency. The assumption has been that an ef-
ficient manager is one who stays clear of paper work and
devotes himself to decisions, policies, and people that will
make money for his company. But the fact is that the work
of executives is cluttered with paper. Moreover, some man-
agements have lately begun to realize that a far better sym-
bol of executive efficiency would be a full wastebasket, and
are acting accordingly.
Yet paper work remains undoubtedly the least efficient
operation in U.S. industry, largely because executives have
paid little attention to the papers choking up their offices.
Though the president's desk may remain relatively bare,
he and his staff normally spend most of their time creating
or shuttling memoranda, letters, and reports, and their
briefcases bulge with reading matter to be absorbed at
night. Furthermore, management is responsible for the
torrent of paper work that is originated, multiplied, and
pumped through the channels of business offices and eventu-
ally poured into the files.
Business today moves on this flood of paper. And most
managements, bent on raising productivity, sales, or what
not, have accepted as inevitable-and often as a sign of
healthy growth-the expansion of clerical production. In
1920 employees in manufacturing industries outnumbered
clerical workers by about four to one ; today, the ratio is
only two to one. In fact, there are now as many clerical em-
ployees (nearly eight million) as there are agricultural
workers. The introduction of carbon paper in the nineteenth
century gave paper work its greatest boost, ushering in
what Luther Gulick, a management engineer, calls the "car-
boniferous and neo-lithographic age." In Europe some com-
panies have restricted the fetish for making carbon copies
by a simple system of colored pencils.* But carbon copies
are a standard addiction in the U.S., and paper work every-
where has been successively expanded by typewriters, dupli-
cators, tabulators, and a whole slew of other office machines.
No one knows how large the output of paper work is, but
*Instead of rewriting a subordinate's report and distributing copies
around the office, some European managers are required to write their
comments and criticisms on the original paper, with each management
level using a different colored pencil. When the boss gets the final paper
he has a revealing cross section of his staff's thinking and judgment.
it is unquestionably mountainous. When Westinghouse de-
cided to clear out its dead files ten years ago it destroyed 120
carloads of miscellaneous papers and transferred another
30Q carloads to a five-story archives building. Similarly,
Equitable Life in 1938 found that its accumulation of old
papers would make a pile fifty-one times as high as the
Empire State Building. Though a continuing housecleaning
program has since reduced the pile by more than half, the
company's store of correspondence is increasing at the rate
of 5 per cent a year.
The accumulation of business papers began to get the
attention of many other managements two or three years
ago. When the atom-bomb scare in 1949 sent companies
rushing to microfilm their corporate records, many execu-
tives saw their paper-work problems for the first time. And
the shortage of office space has made many realize how much
their office and filing systems were costing. Some companies,
Filing by Law
Most companies retain records far longer than is legally neces-
sary. Their most impelling reasons for doing so are federal, state,
and local laws setting up minimum-and often conflicting-re-
tention periods for specific papers. In addition, such agencies as
the ICC, FPC, and CAB have established several thousand de-
tailed regulations of their own. Following is a sample list of
federal requirements:
Type
of record
Years
to be kept
Legal
authority
Receipts, inventories,
Two
and delivery records
Employee earning cards
Three
Fair Labor Standards Act
Employee earning cards
Four
Walsh-Healey, Fed. Social
Security, and Fed. Un-
employment Tax acts
Time cards
Two
Fair Labor Standards Act
Time cards
Four
Walsh-Healey Act
Bills of lading
Two
Fair Labor Standards Act
Payroll records
Three
Anti-kickback regulations
Flight-movement records
Six
CAB
Freight reports
Two
ICC
Repair reports
Six
FPC
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like Equitable, have done their own housecleaning. Some
have hired experts from Remington. Rand, Shaw-Walker,
and other office-equipment makers to show them what to do.
And some have turned their problems over to an outfit
named National Records Management Council, Inc., of New
York, which specializes in slicing the useless fat out of
hoarded papers, both in government and industry.
It was the director-of N.R.M.C., Emmett J. Leahy, who
headed up the Hoover Commission task force on federal
paper work. On that job Leahy's crew of records specialists
applied their housecleaning techniques to the government's
pile of 18,500,000 cubic feet of files. By last year, under
Leahy's program, federal agencies were annually destroying
2,500,000 cubic feet of records (the equivalent of more than
1,600,000 file drawers) ; by last June they, had reclaimed for
active use some 57,000 file cabinets, 78,000 transfer cases,
and 1,400,000 square feet of office and storage space (50
per cent more rentable space than is in Manhattan's Chrys-
ler Building) and had! moved 1,300,001) cubic feet- of papers
to Federal Records Centers. All told, federal agencies had
saved nearly $5,500,000 in paper-work expense.
On a smaller scale, N.R.M.C. has demonstrated. its money-
saving tactics to two state governments (Michigan and
Rhode Island), three cities (New York, Detroit, and San
Francisco), and more than forty corporations. Executives
as well as bureaucrats have been amazed to-discover that
they can cut their office files down by two-thirds or more by
destroying up to half their old records and shifting much of
the rest into low-cost archives. (For a picture of what hap-
pened to the files of Pan American World Airways, see the
chart below.) Monsanto Chemical, an N.R.M.C. client, not
only recovered thousands of square feet of office space, but
cut its normal expenditures for file cabinets from $12,500
to zero the first year, and in addition abolished a $30,000
microfilming program.
Even more important than such savings is the fact that
management is finally finding out how inefficient paper-work
operations really are, and, in a few cases, is beginning to
practice what records specialists call "birth control." The
simplest tool for tlis is what the military services have
called the circular fi e, or File #13-the wastebasket.
The high cost of fi ling
The economics o:' creating, handling, and filing office
papers is still pretty sketchy, but some figures that Reming-
ton Rand has worked out show how much economy is possi-
ble. The cost of prolucing the average business letter, for
instance, ranges from 80 cents to $1.30, and carbon copies
of correspondence comprise about one-third of the 3,000 to
4,000 pieces of paper in the ordinary file drawer. To create
the contents of such a drawer costs nearly $1,000.
This is only the beginning, for Remington Rand has fig-
ured that the averag?e cost of maintaining one four-drawer
file runs around $2;88 a year, and ranges from $88 up to
$640, depending on clerical salaries (about 80 per cent of
the total) and the number of drawers handled by each clerk.
These maintenance figures -do -not include overhead costs of
supervision, building maintenance, taxes, or working space
for the clerks. Even without such overhead, the annual up-
keep on fifty file cabinets would be nearly $7.2,000.
These figures acquire their real meaning, however, when
they are related to :he use that a company's management
makes of its filing system. According to National Records
Management Council, 95 per- cent of all corporate paper
work over a year old is never referred to. What is more,
N.R.M.C. says that 95 per cent of the references made are
to papers less than :ive years old. An analysis by the late
Coleman L. Maze, an office-management consultant, has
shown that for every hundred pieces of paper filed, from one
to thirty may be culled back for reference, and he held
that if this reference ratio is 100:20 or better the filing sys-
tem is "probably goad." However, if the ratio falls below
10 per cent, there is a greater "likelihood that separate [i.e.,
duplicate] files exist. When the reference! is close to 1. per
How Pan Arn Threw Out Over Half Its Eecords
The uselessness of old files has
been demonstrated time and again
by National Records Management
Council, Inc., of New York, a non-
profit organization started in
1947 with a $35,000 Rockefeller
grant. N.R.M.C. did a typical job
for Pan American World Air-
inally in the state indicated by
the photograph at left. All rec-
ords were inventoried, indexed,
and appraised and some were
transferred to the Business Ar-
chives Center (operated in Man-
hattan under N.R.M.C.'s direc-
tion). N.R.M.C. then got Pan Am
to approve throwing out over
half its files. So far, about a hun-
dred tons of waste paper have
been sold for $4,500. The chart at
right shows the disposition of the
files. Monthly storage charges Jn
nearly 12,000 file drawers are
only about 10 cents per drawer.
But Pan Am thinks the chief
benefit is B.A.C.'s reference serv-
ice, which, at an average cost of
22 cents per search, gives cheap,
fast access to old records.
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cent it is likely that the main files
will be only dead storage."
The practice of keeping tons of
old papers on file is found in many
of the best-managed companies in
the U.S. Thus du Pont by 1951 had
filled its "Hall of Records" with
some 280 million pieces of old pa-
per, of which 45 per cent were war
records. To take care of its normal
future accumulation, du Pont either
had to reorganize its record keeping
or build a 28,000-`square-foot addi-
tion (estimated cost, $336,000) to
its storehouse. Du Pont called in
N.R.M.C. to help set up a new sys-
tem of record storage and control,
and found that the reference ratio
on its war records was infinitesi-
mally small: an average of one ref-
erence out of each 1,000 pieces
once every 576 years. This dis-
covery alone enabled du Pont to
store these files more compactly
and, with other space-saving ideas,
eliminated the need for building
an addition to du Pont's archives.
Rating by ratio
In addition to reference ratios,
N.R.M.C. has three other measures
for assessing a company's files.
These are ratios between the num-
ber of employees and the number
of cubic feet of records in the office
and in storage. The first ratio to be
aimed at-and one rarely found-
pany's files between its offices and
its archives. Another yardstick is
the over-all ratio that N. R. M. C.
considers favorable for general of-
fices of manufacturing and sales
organizations-i.e., about five cubic
feet of records per employee, with
only two and a half cubic feet kept
in the office. At plant locations,
however, the ratio should be about
one and a half cubic feet per em-
ployee, with only half a cubic foot
filed in the office.
In specific departments within
general offices, N.R.M.C. has found
that still other, much higher, ratios
are allowable. However, in many
companies the purchasing and ac-
counting departments, commonly
the leading corporate paper-hoard-
ers, retain as much as fifteen or
twenty cubic feet of records for
every office worker. Such ratios
are unhealthy, N.R.M.C. contends,
and it has shown that an efficient
retention and disposal program can
quickly sweat a 20:1 ratio down to
10:1. With "birth control" methods,
this can be further cut to perhaps
7:1, which N.R.M.C. thinks is
about.as low a ratio for this type of
office as one can hope for.
If a large company follows its
recommendations N.R.M.C. esti-
mates that savings can go as high
as $100,000 the first year. And a
third or more of such savings would
be in released space, which would
represent a permanent reduction
in overhead. Economies of this
magnitude were projected for Beth-
lehem Steel, but like many other
N.R.M.C. clients still in the proc-
ess of reorganizing their files,
Bethlehem is not yet willing to dis-
close what its housecleaning pro-
gram has saved.
Wastepaper pays
Many companies, however, have
already gained sizable cash returns
from the sale of wastepaper alone.
In the cleanup of Worthington
Corp.'s files, 154 tons of discarded
paper work were sold for $3,400.
Indeed, before wastepaper prices
dropped in 1951, the sale of dead
files frequently nearly covered the
N.R.M.C. fees.
N.R.M.C. can tell, after a brief
look at a company's records, how
much time and money a job will
require. For example, N.R.M.C.'s
contract with Pan American World
Airways typically covered two sepa-
rate operations. The first was to
make an inventory and an alpha-
betical index of all records. This
work was not to take more than
eight weeks, at a cost of $300 a
week. The second operation was to
appraise all records and get the
company's legal counsel, top ex-
ecutives, and department heads to
approve all recommendations for
destroying old records and shifting
much of the rest to the Business
Archives Center, which is separate-
ly operated in Manhattan by
N.R.M.C.'s Leahy. (See caption
page 4 .) This work was not to
take more than six weeks, at $500
a week. Total for the job: $5,400.
The savings to Pan Am-at least
$26,000 a year-include not only
wastepaper sales, low storage
charges, and reclaimed office space
and file cabinets, but a notable re-
duction in the company's expendi-
tures for filing equipment: from
$16,660 to $180 the first year. And
since the latter expense represented
a single purchase of special fire-
proof cabinets, it did not invalidate
N.R.M.C.'s promise that Pan Am
would not have to buy any new fil-
ing equipment for two years.
Such promises are now a stand-
ard part of N.R.M.C.'s operations.
N.R.M.C. hasn't had enough expe-
rience yet to tell how many cabinets
a company may have to buy even-
tually, but it is certain that future
purchases will not steadily increase
as past purchases usually have.
Aluminum Co. of Canada's bill for
filing equipment rose from approxi-
mately $5,000 in 1950 to $8,000
in 1951 and was headed forthe$10,-
000-a-year level last year when
N.R.M.C.'s survey showed that
future purchases could be postponed
for at least three years.
Advice from a file maker
In view of this, it might seem
strange that sellers of file cabinets,
such as Shaw-Walker, should have
long been recommending to cor-
porations that they clean out their
accumulated papers. However, as
Shaw-Walker's Vice President Fred
Townsend points out, by advising
a client how to cut down on its files,
his company hopes to win the cli-
ent's permanent good will-and
future orders for other office equip-
ment. Moreover, file cabinets are
not a major part of the office-
equipment business. They account-
ed for less than 35 per cent of Shaw-
Walker's business last year.
Shaw-Walker's consulting serv-
ices cost its clients an average of
$150 a day, but a consultant may
save a company so much that the
client is anxious to retain his serv-
ices permanently. One consultant
has been on a job for over eighteen
months and the company won't let
Shaw-Walker take him off. "His
services and recommendations have
only cost us $45,000 so far," the
client argues,. "and he's saved us
half a million already."
Benefits of this sort have not
been achieved merely by cutting
down the files. Shaw-Walker's men
also analyze office methods and
sometimes find that companies
have needlessly raised their paper-
work costs by installing too many
business machines. In one over-
mechanized company, the consult-
ant persuaded management to
throw out seven billing machines
worth over $30,000 and replace
them with electric typewriters and
low-cost clerical help. However, a
former Shaw-Walker consultant ad-
mits that "as often as we'd pull out
machines, twice as often we'd throw
new ones in."
Films vs. files
Since the tendency to mechanize
the office is well developed in most
companies, many have tried to
solve their filing problems with
microfilming machines. U.S. Steel,
for instance, has not only spent
large sums on microfilming but has
equipped three million cubic feet
of storage space in an abandoned
cave in western Pennsylvania where
it is keeping microfilmed records
and original records. There is no
doubt that microfilming old files
can save space. One roll of 16-mm,
film, which takes up only twelve
cubic inches of space, will carry the
photographic images of 3,000 let-
ters, or roughly three-fourths the
contents of a file drawer. The con-
densation ratio is about 99:1.
But it may be much cheaper and
easier to store the original records.
The cost of preparing, filming, in-
specting, and indexing the contents
of a four-drawer cabinet runs to $80
or more. For $80 a company could
store the contents of one cabinet in
N.R.M.C.'s low-cost storage equip-
ment for fifty-three years in space
renting for $1 per square foot. Aside
from the fact that few records need
to be kept for years on end, micro-
filming has other disadvantages.
Microfilmed files are hard to read
and to index, and it usually takes
much longer to find microfilmed
references than it does to find
references in an ordinary paper file.
Also, unless certain precaution-
ary steps are taken, microfilmed
records are still questionable legal
evidence.
But the greatest disadvantage of
microfilming files is that it per-
petuates management's habit of
keeping old records. Companies
that are setting up retention and
disposal programs are at least be-
ginning to break that habit. The
most effective way to break it, how-
ever, is to prevent paper work from
accumulating in the first place.
Big money in forms
Of the many different birth-con-
trol techniques now applied to pa-
per work, perhaps the most com-
mon are those resulting from efforts
to simplify and speed up office
procedures, particularly the control
of forms. Thus a Shaw-Walker con-
sultant (now operating indepen-
dently as Robert M. Shaw Associ-
ates) devised form letters for Car-
bon Black Export, Inc., which re-
placed individually written letters,
each form letter eliminating four
carbon copies from the files. This,
plus some other changes, enabled
Carbon Black to cut an executive
and three clerks from its office staff,
move to smaller, less expensive
quarters, and slice annual operating
costs by some $25,000. Similarly,
General Foods adopted a twelve-
part billing form in 1949 to replace
the separate forms and records of
five different departments, and
thereby eliminated five billing man-
agers and $500,000 a year in over-
head.
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The control of forms is not, how-
ever, as easy as it sounds, for new
forms are always being born. "Peo-
ple will ask for a form to suit a spe-
cial purpose," says Fred R. Jones,
assistant to a General Foods vice
president, "and after a while they
move on-but the form stays." His
company has a system for review-
ing forms every six months, but
even so, some useless ones slip by.
The control of carbon copies of
memoranda is equally difficult.
General Foods' policy is' to send
only one copy of it memorandum
to the company's centralized files.
Despite this, Jones estimates that
every secretary maintains three or
four drawers of papers so, she can
get material for her boss in a hurry.
Curbing the brass
Executives, in Jones's opinion,
are the worst paper savers because
"they work on an individualistic
basis, and don't realize how much
paper work they create." One way
General Foods tries to curb the
growth of records is'to avoid giving
any department extra space that
might tempt a manager to install
more filing cabinets. Before any
now cabinets are supplied, office
managers go through the old ones
to see what papers can be_ thrown
out to give a department, more fil-
ing space. At Equitable Life, cor-
respondence files are weeded out
every third year, and only 5 per
cent are retained.
A far more rigid control of man-
agement's files has been established
in Procter & Gamble's Cincinnati
offices. Back in 1932, P. 4 G.'s fil-
ing methods were revamped when
the company (1) abolished its sys-
tem of centralized files and (2) pre-
vented executives from building up
their own files by restricting each
correspondence "dictator'.' to one
file drawer. Since then, yearly
audits of correspondence files and a
tight control over requisitions for
filing equipment (which must be
approved by a P. & G. officer) have
so changed management's filing
habits that, on the average, one
drawer holds the paper work of four
dictators.
The manager of P. & G.'s district-
office service department, I. J.
Berni, has persuaded many of the
company's executives to adopt
some of the ways he uses to reduce
his correspondence files. One way
is to answer letters, and especially
interoffice memoranda, by writing
a brief reply in longhand on the
face of the original letter, which is
then returned to the seeder. If a
longer reply is required, it is simply
typed at the bottom or on the back
of the original. To make dictators
awarre of their responsibility for
creating excess paper work, in-
structions have been issued to
many P. & G. stenographers not to
make any carbon copies of letters
unless the. dictator specifically re-
quests them to do so. Berni also
recommends that every executive
regularly thin out those files that
are to be kept, and for himself
maintain only "suspense" files, i.e.,
papers on subjects being handled,
and "as soon as the last letter has
been written which closes the file,
consign the entire file to the waste-
basket."
Calculated risks
Reducing correspondence files,
however, is much easier than cut-
ting down on the mass of daily busi-
ness records in an office. For almost
all managements still consider such
paper work essential to proper cor-
porate control. Even P. & G.'s
auditors constantly check the filing
practices of all district sales offices,
and an office manager will be rated
on how many records-he keeps and
how well he keeps them. Detailed
records on salesmen's expenses and
their coupon accounts, for instance,
must be kept to the penny, because,
as one manager said, "P. & G.
wants to keep temptation away
from its salesmen."
This insistence on paper work
for the sake of honesty is found in
most companies, but it may often
be quite unnecessary. For example,
there is one company whose em-
ployees collect as much as $500,000
in a day, and the company deposits
the money as a lump sum without
retaining the identity of the indi-
vidual collections. The bank mere-
ly verifies the total, and charges
the company for any counterfeit
bills or shortages in the total. Since
1949 these have cost the company
less than $250 a year-and the
company saves as much as $20,000
a year in banking charges, in ad-
dition to substantial paper-work
savings.
The kind of calculated risks a
company will take with paper work
depends to sonic extent, of course,
on the kind of business it is doing.
Thus the Reader's Digest does not
keep about 30 per cent of its sub-
scribers' orders, transcribing the
necessary information to stencil
records. But the risk is slight, and
since the magazine carries no ad-
vertising, it does not have to docu-
ment its circulation figures as other
publishers do. However, some com-
panies take considerable risk in
order to bypass a lot of paper detail.
For example, Sears, Roebuck & Co.
has for thirty-five years been send-
ing the customer's original order
and the company's bill right back
with the goo Is asked for. Sears has
found this '`very practical" and,
keeping only a record of the total
bill, takes the risk of havirg to refill
the orders o` customers v'ho claim
they didn't receive shipments.
Similarly, the experienc,, of Unit-
ed Parcel Service, whicl delivers
packages for well-established stores
in twelve metropolitan arc as, shows
how much paper work can be avoid-
ed if management insists on using
the telephone whenever possible.
"We don't get as many as 375 let-
ters from our local customers in a
year," one of United Parcel's man-
agers says, "but we do mike twen-
ty times that many personal con-
tacts." The results are via able in the
company's files: e.g., thou 4h United
Parcel has done business with Alt-
man's in Manhattan sine' 1932, its
complete correspondence ile on this
customer is less than tic ee inches
thick. Further evidence o' the com-
pany's attitude toward p eper work
is the fact that though the New
York office deals with nearly 400
stores the entire nationai manage-
ment staff of forty men 1 as the as-
sistance of only four secretaries.
The urge for protecti in
For various reasons, however,
few companies are yet willing to
take the risks of attacking their
paper-work problems. f lometimes
management simply may not be
aware of office ineicie ivies, but
more often managers bui d up their
files either to protect their positions.
and decisions against future criti-
cism, or to enhance their status.
"Empire building," according to
Shaw-Walaer's Vice .'resident
Townsend, "is the wont ailment
in American business." `he "desire
to serve customers" is another rea-
son given fcr clinging to old papers.
National City Bank, fo ? example,
retains the customer's monthly de-
posit tickets for six years. But the
most common arguments for keep-
ing records are that (1) laws-es-
pecially federal laws--make it
necessary; (2) past records will pro-
tect the company against lawsuits.
Corporate anxiety ovSr possible
litigation has increased, of course,
with the increase in ant trust suits
and government regulatons in the
last twenty years. Where suits have
arisen, old riles have been generally
considered s, good protection. Two
years ago when a federal ;rand jury
began investigating tl e pricing
practices of the soap industry,
Lever Brothers was able to produce
its own old price schedule, back to
published information on competi-
tors' prices for many years, Procter
& Gamble, on the other hand, had
regularly disposed of its old sched-
ules, but its recent records were ap-
parently good enough as evidence
since the grand jury found no cause
for action and closed its investiga-
tion last November. P. & G. is now
relying on the same records to dis-
prove the monopoly charges that
the Justice Department brought
against P. & G., Lever Brothers,
and Colgate-Palmolive-Peet in De-
cember.
The extent to which manage-
ments are inclined to protect them-
selves with old files was revealed by
a national survey of fifty-five com-
panies made by a Chicago file spe-
cialist, Record Controls, Inc. A
tabulation of their retention sched-
ules on 111 common business pa-
pers showed that the shortest re-
tention period (one month) was
applied to only two papers (receiv-
ing reports and tabulating-machine
cards), and the average periods for
even these records were 4.4 and 2.4
years respectively. Three kinds of
papers (stockholders' minutes, prop-
erty papers, and time-study re-
ports) were retained permanently
by all fifty-five companies, and
tracts, ledgers and journals, execu-
tive minutes, patents, copyrights
and trademarks, canceled stock
certificates and transfers, federal
and property tax records, capital-
expense vouchers). In fact, the only-
records that no company kept per-
manently were bills of lading, traf-
fic correspondence, express re-
ceipts, freight drafts, stores inven-
tories, and sales slips.
How long and how much?
The survey also demonstrated
how widely management disagrees
about the length of time any record
should be kept. Some random sarn-
ples: retention periods for "ac-
knowledgements" ranged from six
months to permanent (four com-
panies), with the average at 3.7
years; for expired contracts, from
five to twenty-five years, with the
average at 9.13 years; for drawings,
from five to permanent (twenty-
one companies), with the average
at ton years.
Such disparities are to some ex-
tent due to varying local laws and
statutes of limitations. But in the
majority of cases, management
strongly tends to play it safe by
giving records a much longer term
of life than is legally necessary. For
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 Approved For Release 2001/08/10 : CIA-RDP78-04718AO02700210011-9
ct requires companies to keep in-
coming and outgoing shipping rec-
ords for two years; yet among the
companies in this survey the aver-
age retention period for shipping
tickets is 5.6 years, and two com-
panies keep them forever.
Management's overcautious
hoarding of papers, in short, seems
to bear as little relation to law as
it does to efficiency. Procter &
Gamble's Berni suggests that execu-
tives would be less inclined to ac-
cumulate papers if, before filing
anything, they asked themselves:
"How much added cost would the
company be called upon to assume
if this material were not available."
And if they can't calculate the risk,
they might try a slow, safe method
P. & G. has used to reduce reten-
tion periods. The period on one
type of record, which had been kept
for six years and filled several hun-
dred file cabinets, was reduced first
to three years, then to one year,
then to six months. The period is
now down to three months and still
the company has suffered no incon-
venience or loss. As one top P. & G.
executive said, "We will never know
whether or not we have gone far
enough with our program until we
are hurt-and we haven't been hurt
yet." Plainly, all that management
seems to need to solve its paper-
work problems is a little capitalistic
risk-taking. END
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