"Ideas Are All We Have"

By Marshall Loeb

He looks like a schoolteacher, and he really wanted to become a political science instructor, but he drifted into Dad's Chevy dealership in Hopkins, Minn. So what can one expect from an auto salesman named Bud?

Maybe some snappy marketing ideas, but usually not many grand plans. Yet today Bud Grossman, neat and bland at 58, is the Minnesota Money Machine.

He started a company that ten years ago had revenues of $6.5 million; in fiscal 1979 they hit $445 million; next year after acquiring a firm that leases containers for ships, they are expected to reach $650 million. Grossman leases and manages vehicles and now commands a larger fleet than the U.S. Postal Service: 275,000 autos, trucks, trailers, forklifts and refrigerated vans. His customers include 85% of the FORTUNE 500 and thousands of other firms from Mexico's Yucatan to Canada's Yukon and into Europe. More than that, from his glass-walled office overlooking aptly named Eden Prairie, Minn., Grossman propagates some unorthodox notions about how to build a major enterprise and motivate managers and enhance productivity.

Necessity forces creativity, in Grossman's view. Necessity was the ultimate energy source that propelled him into leasing. The family auto dealership had branched out so widely in the early 1960s that Chevrolet would not grant it more franchises in greater Minneapolis. But Grossman figured out that he could get as many cars as he wanted, if he leased--not sold--them to large companies.

So he launched General Leasing Co., later abridged to Gelco. It grew big because Grossman had a further idea: don't just lease vehicles but also manage them, keep computer records on when each one needs a lube job or a tire change, when to trade it in for the best price. Companies tripped all over themselves to buy his service; it eliminated one more management migraine. He admits: "There is nothing we do that any one of our clients cannot do. But they cannot do it as inexpensively as we because we aim all of our services at a large market."

Anything that moves is Grossman's target.

Packages move; Gelco bought a courier service that in fiscal 1979 did $65 million in business and, helped by mass marketing and computerized control, may top $95 million next year. People move; Grossman is building a service by which corporate travel will be handled by a central reservation and billing service. He also watches over that wondrous American institution: the expense account. Companies can require that salesmen and others on the expense account submit their claims to Gelco's computers, which check them for any excesses.

Grossman hires young, hungry executives and believes in giving them the opportunity to fail. Only if they are willing to take chances, he feels, will they produce ideas. "I cannot ever remember telling a manager, 'Now, you can't do this.' Instead, I might say, 'If I were doing it, I wouldn't do it your way. But I do not believe that there is just one right way to do something.' " There are times--not many--when a Gelco manager takes a risk and flops.

"But if he does," says Grossman, "he learns a whole lot. He also gains a certain confidence in the company because it backed him up. We have to be damn sure that we don't make anybody so scared that he will be afraid to float a suggestion or try something. Ideas are really all we have."

Grossman harbors a revisionist belief: technology retards productivity by ultimately robbing people of creativity. "The new office technology is a step backward. The worker gets bored as hell with what he is doing. A person used to sit down and type a letter and identify with it. Now we put it into one big damn machine, change a few words and produce 100 or 1,000 different letters. We have dehumanized a lot of things."

Putting back some humanity can also help efficiency. After only 90 days on the job, every new headquarters employee at Gelco has to be comprehensively interviewed: How do you like what you are doing? What can we do to make your job better? Says Bud Grossman: "We are involving our employees in a lot more decision making. If we can push decision making down to the lowest level, we will do better." And it may well be that the whole economy will do better.

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