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532 HARVARD BUSINESS REPORTS
were responsible to their respective division managers. Programs for all Vulcan theaters were arranged in the central office.
Weekly budgets, subdivided individually into their several classifications, were established by the New York office. Items listed in the budgets included film rentals; stage presentations; music; advertising and publicity; current house expenses, such as salaries, heat, light, and power; district and home office supervision; and fixed overhead charges. All advertising appropriations were flexible to the extent that balanced theater quotas were required but once in every three months. The Vulcan Theaters Corporation considered advertising to be one of the most important functions of its theater managers. Since it was practically impossible to plan local campaigns centrally, each theater manager was permitted to proceed within the limits of his budget to the best of his ability. A limited amount of supervision was exercised by the district office.
The shortage in the supply of available theater managers of the proper type came as a result of several factors. Since 1920, the motion picture industry had developed rapidly. Furthermore, integration had consolidated over 65% of the total box office income under the control of four large theater-operating companies, one of which was the Vulcan Theaters Corporation. These companies naturally found it advisable to install rigid control systems, which in turn required the services of theater managers who not only possessed the qualities of showmanship, but who were willing to conduct their assignments in accordance with company policy. Since these qualities could not be found in many prospective candidates derived from the customary sources of supply, the company more often retained the existing management of acquired theaters despite the tendency on the part of such managers to become disinterested in their work and to oppose the use of a rigid control system.
The proponents of a managerial training school emphasized the importance of theater managers because it was through them that the organization came in direct contact with the public. In a training school, prospective managers would be under close observation; hence judgment could be formed as to their capabilities, personalities, and habits. Before a manager was placed in charge of expensive theatrical equipment, was made responsible for funds, or was placed in a position to influence public goodwill,