Harvard Business School -9- it over the 204 acres we end up with 284 acres of land usable for industrial purposes where non existed before. As I believe you will see from the foregoing remarks, the management approach varies with what you are trying to do as a contractor. If cost control is the key to success for the bidding contractor, merchandising the key to success for the tract builder, then ingenuity is the key in the third approach. The third approach necessarily demands creators and not caretakers, for it puts a premium on the man with a good idea. It also offers, when properly carried out, greater profits and perhaps some greater safety through reduction of risk. The flexible contractor, diversified and in a better position to offer a more complete service to his clientele, removes his operations from the strictly competitive arena and is able to win work volume by anticipating and solving in advance some of his customers' problems. Oddly enough, a by-product of our entry into mining operations of our own has been the development of know-how that has greatly assisted us in obtaining contract work from our mining company customers who now look to us with even greater confidence as the engineering and construction firm to which they can safely entrust their problems. The adoption of the third approach necessitates a different kind of organization, the creation of staff departments, the assumption of greater overhead expense, and places a far greater strain financing the company's operations. As the contractor invests his funds in land for development or in equities or permanent operations, he sacrifices in some measure the liquidity that character-izes the operations of the bidding contractor or even the tract builder. He sacrifices immediate profit in the expectation that his investments will ultimately return to him a far greater profit, and this poses a problem in finance. It's a rule in financing construction companies that you never operate on your own money unless you simply cannot avoid it. No group of men have figured out more ways to operate on the other fellow's money than have the contractors. It is also a characteristic of the industry that construction companies are privately owned and, to my knowledge, there is no instance of a construction company