What Is IBM’s Real Secret? : BLUE MAGIC The People, Power and Politics Behind the IBM PC <i> by James Chposky and Ted Leonsis (Facts On File: $19.95; 224 pp.) </i> : THE IBM LESSON The Profitable Art of Full Employment <i> by D. Quinn Mills (Times Books: $17.95; 184 pp.) </i>

In “Blue Magic” two professional writers, using good investigative reporting (astonishingly good, considering the difficulty of digging an inside story out of the impenetrable wall around IBM) tell the story of the maverick Personal Computer project from a perspective from within IBM’s Boca Raton, Fla. lab site. The reader is swept along with the urgency, painful politicking, and corporate upheaval that that project caused.

The “Magic” involved here was the man at the helm, Don Estridge. Through sensitive interviewing of Estridge’s peers, (Estridge was killed in the Delta Flight 191 crash at Dallas airport in late 1985) and the principal players on the project, the authors evoke the feeling of those days, the spirit of the men: the tremendous thrill of the hard work and long hours that brought them success. The book reads like a fast-paced mystery, hard to put down. Few IBMers will read it without shedding a tear or two, as the book unveils the untimely death of this magnificent man, snatched from life, family, and career at his peak. The man had so much left to teach us about business and life itself. You have the feeling when you put down this book that Estridge wouldn’t actually have minded dying at that time of his life--he had just completed an impossible task, was totally loved (the odd jealous peer, of course), and had had a life just as he wished it to be.

If there is a lesson to be learned about how to build a successful business a la IBM, this is the book. The lesson is in the man, and his humane management style based on personal ethics and total respect for his men and what he was about. Gold stars to James Chposky and Ted Leonsis for sniffing this one out and putting it together so engagingly.

“The IBM Lesson: The Profitable Art of Full Employment” reads like an extended term paper, to which I would give a C+. Author D. Quinn Mills, using the interview method plus analysis of internal IBM satisfaction surveys, develops a rosy picture of the relationship between IBM management and employees, which he attributes to a great extent, to the so-called “full employment policy.”

The full employment policy of IBM has been argued inside and outside the company for many years. On the one hand, it is the negative reins on the business, attracting security seekers rather than go-getters, and very costly in a field where the technological projects change demeanor and location every three years. On the other hand, it is the positive difference between IBM and other giant corporations: Gifted IBM engineers and sales people give their utmost, knowing they will always have a secure job.

Mills perceives a high degree of loyalty to the company for which he gives much credit to this policy. A story is told about an employee who recently was asked to transfer from Boulder, Colo., to Charlotte, N.C., when the Boulder plant function was closed down. “Dick” didn’t like leaving the Colorado area but to quote: “The repeated low-key effort of the company, acting through his manager, to get him to relocate was having its impact on Dick’s resolve. If they persisted, he realized, there was probably a real need. And he knew that for years he had relocated to a lesser degree than his peers in IBM. His basic loyalty to the company began to assert itself. The company had done a great deal for him, and if it now needed his support in return, he was prepared to put aside his own convenience. . . .” There is no recognition of the real pressure brought to bear here, which is one of being black-balled from the “good boy list” and left out of the promotion selection process in the future. Herein lies the major flaw of this book.

A scientist would have done the analysis quite differently: He would have analyzed all the positive benefits which may have ensued from the employee’s knowing that he wouldn’t be fired frivolously, but he would also have looked to see what possible other causes for these beneficial effects were present, as well as what possible negative effects could be present both for the employee and for the company. This book begins with a positive bias toward full employment, the profitability and benevolence of which is both its thesis and its premise. It tries to prove what in fact it assumes by using IBM data. It never actually verifies whether full employment is the cause of the effects it monitors, not to speak of what other effects full employment may cause. The author should have dug a little more deeply into the data he used: How do people fill out those satisfaction surveys? Do they really write down their fears and worries, or do they fear and worry about the very voicing of concern?

My experience says the data itself are rosy because of the heavy-handedness of the top-down management style of the company. This is the other side of full employment. The company is free to demand inhuman sacrifice, its autocratic control stemming precisely from the perception that it is the “safest” place to work. .

A few pages at the end of the book offer a parallel analysis of the European corporate scene, recommending that governments there take a look at IBM’s way and loosen up on some of their protective legislation toward personnel. This is very worrisome because the reader has been shown only one side of the American coin. Europe in 1989 is far ahead of the United States in people management; IBM must supplements its benefits just to be within the law there. Many benefits accrue to the employee from the fact that the guarantees of employment in Europe come from the governments rather than from the company. Mills neglects this data entirely.

Mills’ book does not go very far beyond a management perspective on full employment policy. Mills’ own version of the policy, which he describes, deserves study. But much more analysis needs to be done. Mills put far too many employees’ warm fuzzies into the data he is attempting to interpret, and he neglects almost entirely a comparison of the alternatives. His last pages reflect a chauvinistic view of advanced European management.

“Blue Magic,” the more enjoyable book, is also by far the better.