Dale Carnegie Training, Inc. History

Company Perspectives:

Dale Carnegie improves performance and quality of life through training.

Company History:

Based on Dale Carnegie's classic self-help book, How to Win Friends and Influence People, family-owned and -run Dale Carnegie Training, Inc. offers a path to successful living, with a heavy emphasis on success in business. In the late 1990s the company, both directly and through licensed sponsors, was instructing more than 3,000 students a week in about 70 countries, making it one of the world's largest adult-education operations. Its graduates included such noted entrepreneurs and business leaders as Tom Monaghan (Domino's Pizza), Mary Kay Ash (Mary Kay Cosmetics), Frank Perdue (Perdue Farms), and Lee Iacocca (Ford Motor Company and Chrysler Corporation).

The Carnegie Course: 1912--44

The son of a hardscrabble Missouri farm couple, Dale Carnegie found, while attending college, that training in public speaking enabled him to overcome shyness and raise his level of self-confidence and self-esteem. After a brief stint as a salesman, Carnegie moved to New York City to become an actor. He soon became discouraged, left show business, and returned to sales but did not find his niche until, in 1912, he offered to teach an evening course in public speaking at a Manhattan YMCA. Refused a $2-per-session salary, he negotiated payment on a commission basis instead and soon was earning $30 to $40 a night, teaching at YMCA's in Philadelphia, Baltimore, and Wilmington, Delaware, as well as New York City.

As Carnegie's course evolved, it broadened from public speaking to confidence building and increased personal effectiveness. By 1914 he was making $500 a week and hiring assistants to help him teach what he came to call the Dale Carnegie Course in Public Speaking and Human Relations. At first Carnegie simply posted rules or points for the 16-session course on a series of postcards he distributed to instructors. The postcards evolved into a series of booklets given both to instructors and to students taking the course. But despite Carnegie's hiring of instructors, his course remained essentially a one-man operation for many years, with average enrollment of fewer than 1,000 students a year. In 1935 he named his enterprise The Carnegie Institute for Effective Speaking and Human Relations.

Following the publication of Carnegie's 1936 book, How to Win Friends and Influence People, which more than 60 years later was still in print, the public flocked to his banner. A 1937 New York Times advertisement offering a free demonstration by Carnegie at the Hotel Astor promised 15 benefits in taking the course, among them the ability to think on one's feet, increase income, win more friends, improve one's personality, develop latent powers, and get to know intimately 40 ambitious men and women. It drew 2,500 people. According to a 1937 Saturday Evening Post article, the course consisted of 40 sessions over 16 weeks and cost $75. Classes were given such names as The Magic Formula Session, The Crashing-Through Session, The Heckling Session, and The Making-Your-Body-Talk Session. They were presided over by professional instructors paid $25 a night.

Other articles, written at various times, described the course in somewhat different ways. In order to master his techniques, Carnegie first required each student to seek a new approach to achieving his or her goals and then to share the results with the other students. In keeping with his maxim that "a man's name is to him the sweetest sound in any language," much of the first session was given to learning how to remember the names of the other participants. The fourth was a kind of show-and-tell session in which each class member was to bring "an exhibit that represents an achievement." The fifth, or "breakthrough" session was devoted to "coming out of your shell." In the seventh, the participants divided into smaller groups. The eleventh, like the fifth, was given to breaking down inhibitions, through role-playing exercises. Each student was expected to give at least one two-minute talk per session.

Training for Corporate Managers: 1945--90

In 1944 Carnegie began licensing certain territories to sponsors who agreed to pay a percentage of revenues to the home office and follow its instructional guidelines. Privately held Dale Carnegie & Associates, Inc. was established in 1945, with Carnegie as president and his wife Dorothy as vice-president. By 1949 the Dale Carnegie Course (now 14 rather than 16 sessions) was being offered annually to 15,000 students attending 300 classes in 168 cities in the United States, Canada, and Norway.

The annual number of Carnegie students had reached 60,000 by 1957, in 14 countries. License holders generally held classes in office buildings or hotels, but in some cases conducted sessions in conjunction with business or commercial colleges that they also operated. The staff of nearly 900 teachers was trained by a supervisory staff of 20 instructors from national headquarters. The course was for 14 weeks, with one four-hour session each week, generally from 6:30 to 10:30 p.m., with the tuition, including all books and materials, usually between $125 and $150. Subjects covered included developing poise, relaxation techniques, overcoming shyness, and displaying enthusiasm.

Although Carnegie's students sought personal growth and happiness, they commonly had more tangible goals, notably increasing their earning power. Business, in turn, was seeking enthusiastic, motivated, self-starting employees and middle managers who could motivate the people working for them. The Carnegie course instilled practical leadership skills based on cooperation rather than confrontation. General Motors Corporation began sending employees to Dale Carnegie & Associates in 1949, paying half the tuition. By 1959, 67 companies were sending staffers to Dale Carnegie, and some, such as The Coca-Cola Company, were paying the entire cost.

Dale Carnegie died in 1955 and was succeeded by his widow as head of Dale Carnegie & Associates. She was credited by Joseph Kahn of the New York Times with transforming the enterprise from "'a Mom-and-Pop store' into a carefully managed commercial operation." She continued the policy of seeking enrollment from the ranks of corporate America and started a workshop for women that did not, however, prove financially successful. Although she remained the major stockholder of the closely held family corporation and had the title of chairwoman, her son-in-law, J. Oliver Crom, became president and chief executive officer of the enterprise in 1978.

Executives of Dale Carnegie & Associates said in 1983 that enrollment was at a record high and that they expected before the end of the year to graduate their three millionth student. The company now had its own "institutes" in 13 cities and 135 licensed sponsors in about 60 countries. There were now Carnegie courses on sales, customer relations, professional development, and executive presentations as well as the original one on public speaking and human relations--testimony to the overwhelming emphasis on business training.

Dale Carnegie & Associates also continued, however, to stress the founder's commonsense principles on how to win friends and influence people: smile, listen to others, make them feel important, encourage and praise good work, call attention to mistakes without violating Carnegie's first principle, "don't criticize, condemn or complain." Required reading, in addition to How to Win Friends and Influence People, included two more of Carnegie's books: one on public speaking, first published in 1926, and How to Stop Worrying and Start Living (1948).

The Dale Carnegie enterprise of the 1980s received renewed attention partly due to the efforts of Lee Iacocca, who, after reviving the fortunes of Chrysler Corporation credited, in his 1984 autobiography, the Carnegie course with transforming him from a "shrinking violet." By 1987 more than 400 of the nation's 500 largest companies had sent employees to take a Carnegie course at one time or another, and more than 75 percent of the 157,000 students enrolled annually were under corporate sponsorship. Licensed instructors were required to pay $750 and spend two years in part-time training. The basic course cost $700 to $1,000. Dale Carnegie & Associates celebrated the 75th anniversary of the original Dale Carnegie course in 1987 with a four-day convention in St. Louis.

The public-speaking course, based on Dale Carnegie's original seminar, remained by far the most popular of the eight different courses being given in 1989. This course was offered one night a week for 12 to 14 weeks. (The others were: sales, management, professional development, strategic presentations, customer relations, employee development, and executive image.)

Dale Carnegie in the 1990s

By 1990 Dale Carnegie & Associates had worldwide annual enrollment of more than 170,000--an increase of 60 percent since 1983--and 4,500 instructors. In that recession year, however, the enterprise suffered its first drop in enrollment since 1980 (during another recession). Even Chrysler eliminated its policy of paying the tuition (now $895 for the basic 14-session course) for any employee who wanted to take a course. Crom said in 1991 that the company was still profitable. However, it cut its courses from 14 to 12 weeks, updated the basic course, and added new business-related "modules."

There was no change nor need of change in Dale Carnegie's orientation. A Los Angeles Times reporter who attended a class in 1991 wrote, "Most enrolled because they want to do better on the job, though a few say they need help in family and personal relationships." In 1994 there were 4,000 Dale Carnegie instructors and 142 licensed sponsors in over 70 countries on every continent except Antarctica. The eight courses were being offered in 20 languages.

Stuart Levine succeeded Crom as chief executive officer in 1992, although he still reported to Crom, who remained president. Interviewed for Newsday in 1995, Levine told Drew Fetherston, "I have to tell you, this business was going south.... When income starts to drop, you take it personally." The problem, he felt, was that the company's offerings were out of date, with just one training course added in 15 years and a host of aggressive competitors nipping at the enterprise's heels. "We took a year and spent a large proportion of our advertising dollars on research," he continued. The result, according to Levine, was a greater emphasis on international sales--now responsible for 41 percent of revenue--new courses, and training companies to use workplace teams. The company also changed its name to Dale Carnegie Training and adopted a new logo and mission statement.

One result of the research effort was the creation of a short leadership program for middle- and upper-management people, titled "The Leader in You." Another was a book cowritten by Levine: The Leader in You: How to Win Friends, Influence People and Succeed in a Changing World. A quarterly newsletter, The Leader, was introduced in 1995. Levine, in October 1995, said the company's market share had increased eight to nine percent in the last year, on top of a three percent increase the year before, thereby reversing a three-year decline.

The flagship Dale Carnegie Course also underwent a revision during this period. It now began by asking participants to write a vision of how they would like to see themselves in the future. This vision became the anchor for the individual's course experience and was examined through what the company called "the five drivers of success," namely, self-confidence, human relations, communications, leadership, and controlling stress. These areas provided the framework of the course, leading to a four-phase continuous-improvement cycle, consisting of attitude change, knowledge, practice, and skill development.

Each of the 12 sessions now covered the following 12 subjects: laying the foundation for success, remembering names, building self-confidence, setting breakthrough goals, using the power of enthusiasm, crashing through barriers, strengthening relationships, using the power of recognition, becoming flexible, stating opinions, inspiring others, and identifying breakthrough results. Firms could also request a course tailored to their particular needs or problems.

By mid-1998 Crom again was chief executive officer, and Levine had departed. Crom indicated that the company, in which family members held all the stock, would remain private. "For us, the benefit of being private is more stability in terms of the people we have," he told James T. Madore of Newsday. "This is a very secure business.... We have certain strengths that we believe would be lost as part of a larger corporation." Dale Carnegie Training had offices in 70 countries and five million graduates in 1998. Annual revenues, including that of the licensees, came to $187 million in fiscal 1996 (the year ended August 31, 1996). The company reserved for itself operations in ten or more cities, including New York and Washington.

In addition to the basic Dale Carnegie Course, Dale Carnegie Training was, in early 1999, offering six other courses: sales advantage, leadership training for managers, high-impact presentations, leadership advantage, customer relations/employee development, and professional development.

Further Reading:

• Abrams, Garry, "All Smiles," Los Angeles Times, June 14, 1991, pp. E1, E16--E17.
• Barron, James, "Old Ways Pay Off for Dale Carnegie," New York Times, August 8, 1983, pp. D1, D8.
• Berry, Joe, "Dale Carnegie's Blues," Adweek's Marketing Week, February 17, 1992, p. 16.
• Conniff, Richard, "The So-So Salesman Who Told Millions How to Make It Big," Smithsonian, October 1987, pp. 82--86, 88, 90, 92--93.
• Fetherston, Drew, "Winning Friends, Influencing People," Newsday, October 9, 1995, pp. C1+.
• Furio, Joanne, "His Own Success Story: He Knows How to Win in Business," New York Times, October 15, 1995, Sec. 13, p. 2.
• Harriman, Margaret Case, "He Sells Hope," Saturday Evening Post, August 14, 1937, pp. 13--14, 30, 33--34.
• Johnson, Dirk, "At 75, Carnegie's Message Lives On," New York Times, December 13, 1987, p. A28.
• Kahn, Joseph, "Dorothy Carnegie Rivkin, 85, Ex-Dale Carnegie Chief, Dies," New York Times, August 8, 1998, p. A13.
• Kelley, Bill, "How to Make Friends and Sell to People," Sales & Marketing Management, August 1989, pp. 40--42.
• Kemp, Giles, and Claflin, Edward, Dale Carnegie: The Man Who Influenced Millions, New York: St. Martin's Press, 1989.
• Madore, James T., "All in the Family for Most Privates," Newsday, June 8, 1998, p. C21.
• Nelton, Sharon, "How to Win Friends--for Half a Century," Nation's Business, December 1986, pp. 40--41.
• "Perk Up Your Personality," Changing Times, February 1957, pp. 15--17.

Source: International Directory of Company Histories, Vol. 28. St. James Press, 1999.

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