Learning from the management style of "the great communicator."

IT IS VERY COMMON to hear that government would run better if it were more businesslike. That may be true much of the time. Nevertheless, let us turn the tables on that proposition. Couldn't business benefit from learning some management lessons from a surprisingly gifted governmental executive--Ronald Reagan?

Those who had the good fortune of working for Pres. Reagan witnessed firsthand the effective management style of an unusually successful chief executive. Here are 10 lessons that could be learned from observing Reagan in action:

Set clear and attainable objectives, albeit goals that seem difficult to achieve. In early 1981, the President set his sights on a healthier economy with lower inflation and unemployment. Those who thought only in terms of a trade-off between more jobs and a slower rise in prices were proven wrong. Under his leadership, the U.S. achieved both objectives.

Aside from the substantial rollback of taxes, the adjustments made in economic policy in 1981-82 initially were painful. They especially included a wide variety of spending cuts as well as a tight monetary policy. Nevertheless, those actions led to the longest peacetime expansion in American history. Simultaneously, the escalating double-digit inflation that the Reagan Administration faced in early 1981 has been consigned to the history books.

Choose subordinates who share your views and outlook. Disagreements on details are inevitable among strong-minded people. Nevertheless, the team that Reagan brought together was united in its dedication to lower taxes, much slower growth in civilian spending, a stronger military establishment, and a less burdensome regulatory system. Progress in each of these areas was substantial during his eight years in office.

Give your people lots of leeway and operating authority. For example, those charged with putting together the initial budget cuts had full discretion in assembling an ambitious assortment of spending reductions. Subsequently, the President reviewed each significant budget change before making his final decision.

Reagan was anything but a robber stamp. However, he did not try to micromanage the decisionmaking within each of the agencies, but held his appointees accountable for the results. He gave his key subordinates a lot of genuine discretion to exercise. For example, one of my first assignments was to perform an audit of the U.S. economy. The President announced the audit's results at a White House press briefing that we conducted jointly. The report made it clear that the economy was suffering from a combination of illnesses: high inflation and low growth, as well as high taxation, rising government spending, and excessive regulation.

Reagan left the press conference early and it quickly became evident that the questions would not be limited to the announced topic. After he was gone, one of the reporters asked why the President said he could not find his checkbook. My answer was that, personally, I delegated that task to my wife. Amidst the laughter that followed, the press went another question. By the way, as president, Reagan used lots of good old Treasury currency. He mailed out quite a few $10 and $20 bills in response to some heartrending letters he received.

In retrospect, Reagan was a seasoned executive even before assuming the presidency. He had been the successful governor of the country's most populous state--California--for eight years. Prior to that, he served as president of the Screen Actors Guild. (As he loved to point out, he was the only U.S. president who had been head of a labor union.) In both capacities, the President led the organization during periods of great external pressures while effectively dealing with difficult personalities inside the bureaucracy.

Strongly back your people, especially when they are attacked for trying to carry out your policies. Here is a personal example. In a public presentation describing the budget problems facing the country, I had the temerity to suggest that annual Social Security increases after retirement (the so-called cost-of-living increases or COLAs) were not part of an insurance program. They really were welfare benefits paid by someone else, in US case, the working population. Some member of the Congress was so angry that he urged my impeachment. I was very relaxed. The odds were that, if the issue ever did reach the President, he just would have had a good laugh The threat, of course, evaporated quickly.

Use humor to good effect. Yes, Reagan loved to tell funny stories. One of his favorites concerned the boy who was digging through a manure pile. His explanation for that strange action was that there had to be a pony in there somewhere. Usually, though, the President's purpose for recounting a humorous tale was quite serious. Being too polite to tell some bore to shut up, he instead would interrupt by telling a story. When he finished, the discussion would shift to a new subject.

On other occasions, when the internal debate was in danger of getting too strident, Reagan would break the tension by telling another funny story. He possessed a deep inventory of humor, much of which drew upon his authentic Irish brogue as well as a convincing Italian accent.