For UPS Managers, a School of Hard Knocks

Execs share the kind of gritty life experiences of some workers

At United Parcel Service Inc. (UPS ), rules are religion. Without them, UPS could never move 13.5 million packages to their destinations on time each day. But two years ago, Mark J. Colvard, a UPS manager in San Ramon, Calif., had to decide whether to buck the system. A driver needed time off to help an ailing family member, but under company rules he wasn't eligible. If Colvard went by the book, the driver would probably take the days anyway and be fired. If Colvard gave him the time off, he would catch flak from his other drivers. Colvard wound up giving the driver two weeks, took some heat--and kept a valuable employee.

Six months earlier, Colvard admits, he would have gone the other way. What changed his approach? A month he spent living among migrant farmers in McAllen, Tex., as part of a unusual UPS management training experience called the Community Internship Program (CIP). After building housing for the poor, collecting clothing for the Salvation Army, and working in a drug rehab center, Colvard said he was able to empathize with employees facing crises back home. And that, he says, has made him a better manager. "My goal was to make the numbers, and in some cases that meant not looking at the individual but looking at the bottom line," says Colvard. "After that one-month stay, I immediately started reaching out to people in a different way."

CIP began in 1968 as the brainchild of UPS founder James Casey, who wanted to open up the eyes of UPS's predominantly white managers to the poverty and inequality exploding into violence in many cities. By now, nearly 1,200 current and former middle managers have moved through the program. And it has evolved into an integral part of the UPS culture, teaching managers the crucial skill of flexibility at a company that is trying to fit a diverse base of employees into its rigid rules-based culture, which prescribes everything from how delivery people should carry their keys to how many steps they should take per second. UPS needs rules, but it also needs managers capable of bending them when necessary. "We've got 330,000 U.S. employees," says Don B. Wofford, the CIP coordinator and a graduate of the program. "There are all kinds of personalities and all kinds of diversity. We need managers who can manage those individuals."

Therefore, each summer UPS plucks 50 of its most promising executives from the company's 2,400 managers and brings them to cities across the country, where UPS partners arrange for daily community service projects aiding local populations. The problems encountered there--from transportation to housing, education, and health care--are the kinds of issues many UPS employees confront every day. By forcing managers to grapple with the same problems, UPS hopes to awaken them to the difficulties many of their employees face, bridging the cultural divide that separates a white manager from an African-American driver or an upper-income suburbanite from a worker raised in the rural South. This is a necessity for UPS, where minorities--many from poor neighborhoods--make up 35% of the workforce and 52% of new hires. Three out of four managers, meanwhile, are white.

In New York this summer, eight managers visited the emergency room at Bellevue Hospital, tutored inmates at Sing Sing in interviewing skills, and provided meals to the homeless. The experience took them far outside their comfort zones in ways large and small--whether it was using public transportation for the first time in years or an initial encounter with violent crime such as the triple homicide that took place a few steps from the Henry Street Settlement, the community center where they lived. "A lot of rising stars going off to this program have gotten sure of themselves. That leads them to be quick with solutions," says Jeffrey A. Sonnenfeld, an associate dean at Yale University's School of Management who has studied UPS. After CIP, "instead of reacting, they would listen. They learn incredible skills of empathy."

UPS values those skills highly: In 34 years, it has never scaled back the program, even during the cost-cutting that accompanied September's terrorist attacks or the Teamsters strike in 1997. Excluding the cost of paying managers' salaries throughout the program, UPS's costs now amount to $10,000 per intern, or $13 million since CIP's inception. UPS concedes that it has no concrete evidence that the program works. But that's not surprising, says Noel M. Tichy, a University of Michigan B-school professor who ran General Electric Co.'s renowned training program at Crotonville, N.Y., in the 1980s. The impact of even the best programs is hard to measure. "You think we ever measured what you can get out of a Crotonville course?" Tichy says. "It's anecdotal."

But managers who have been through the UPS program say it made them more likely to search for unconventional solutions. Patti Hobbs, a division manager in Louisville who spent a month on New York's Lower East Side in 1998, remembers being impressed by the creative ideas of uneducated addicts for steering teens away from drugs. Realizing that the best solutions sometimes come from those closest to the problem, she immediately started brainstorming with the entire staff instead of just senior managers. Says Hobbs: "You start to think there's no one person, regardless of position, who has all the answers. The answers come from us all."

One month living among the poor won't change the world. But it might help UPS managers see their employees as more than just a cog in a very efficient machine.

By Louis Lavelle in New York

Before it's here, it's on the Bloomberg Terminal.