''The Harvard Business Review is a giant, and all the rest of us are midgets.'' James O'Toole, editor of a magazine just launched by the Graduate School of Business Administration of the University of Southern California, was grumbling a bit about the chief competition. His New Management magazine, he figures, will find a niche between Fortune magazine and the Review.
But it may difficult to nudge in. The Wharton School of Business and Finance of the University of Pennsylvania attempted to produce a quarterly business publication to compete with the Harvard Business Review (HBR), but about a year ago it went out of business after losing considerable money.
Other business schools turn out publications. But they are primarily scholarly, or they are aimed mostly at the alumni, or they are slick money losers aimed at giving their schools prestige.
None of them match the Review, with its circulation of about 240,000 executives (82 percent), professionals (10 percent), academics (4 percent), and others, its attraction to advertisers (381 pages at an average of about $5,000 apiece last year), and its high profitability (it indirectly covers a lot of subsidies for doctoral students).
Mr. O'Toole may charge that the Review is ''stodgy,'' that most subscribers read less than one of its lengthy articles per issue. But as he also says, the Review is an ''institution.'' Business executives or consultants consider it prestigious to have it grace some reception table - and even more, to have an article published in it. Many a consultant has built his reputation and business on an HBR article.
The readers must also find the 61-year-old Review useful, however. Circulation was 167,000 in 1975, considerably less than today. Readers buy some 2.3 million reprints of individual articles per year ($1 each, or less for volume orders), plus tens of thousands of books of reprints on various topics. Many of the articles have a ''long shelf-life'' - they remain useful for years to managers.
An idea of the Review's content can be gained from some titles in the latest issue of the six-times-per-year publication: ''Managing for efficiency, managing for equity''; ''The information archipelago - governing the new world''; ''End-game strategies for declining industries''; ''The plant after next''; and ''Antitrust risk analysis for marketers.''
Such articles are 6,000 to 8,000 words long, and they are written mostly by amateur authors - although usually experts (academics or professional executives) in some side of management. That means, notes Timothy Blodgett, one of two senior editors, that most of the articles are rewritten once, twice, or even more. The authors are paid a mere $500 for a full-length article - ''not much for the hoops we make our authors jump through,'' Mr. Blodgett admits. ''The fact that we are prestigious helps. They want to get published.''
Today the Review faces new challenges. It doesn't consider the publications of other business schools much of a threat. But the Review's editors do worry somewhat about the competition from such publications as Inc. Magazine, which aims at reaching managers of small to medium-size businesses, or Venture, or Success, or such general business publications as Business Week, Forbes, and Fortune. ''We are more in competition for the reader's time than we ever were,'' Blodgett says.
To meet that competition, the Review has in the last few years started to edit with a sharper pencil. Articles have been shortened from between 8,000 and 10,000 words to between 6,000 and 8,000 words. ''The style has gotten simpler, more direct,'' says Blodgett. ''It isn't exactly 'zingy,' but it is less tedious than it used to be.'' Three more editors have been hired to help out, starting this fall. The topics of articles have been extended to ''reflect the broader scope and greater sophistication of our readers.'' Besides details on some aspect of management, such as marketing, finance, or manufacturing, the magazine looks at the place of American business in the world with articles on, say, industrial policy or the decline in competitiveness of American industry.
The approximately 100 articles published each year are chosen from more than 1,500 manuscripts. Some of them come in unsolicited; others are sought out by the editors. Because of the Review's increasing prosperity, it can now afford to send its editors to key academic and trade conventions, to spot trends and potential authors. The editors themselves are doing more writing.
Nowadays, articles from the Review are published regularly in 14 foreign languages. The Review has joined in partnership with seven publishers abroad to turn out seven foreign-language journals, mostly quarterlies. The latest (see illustration) started in South Korea this summer. A new Chinese-language journal will be published from Hong Kong in September.
Review editor Kenneth Andrews, in an interview, noted that the articles in the magazine to some degree reflect the shifting interests of America's managers. Right now, there are more articles about the nitty-gritty of making a good product; about public affairs and the business-government relationship; about industrial policy - that the government should help steer the direction of industry; and about business ethics.
The goal of the magazine is to be an educational arm of the school, describing new concepts and trends in administration to those in policymaking and leadership roles. ''We should have a constructive influence on business throughout the world,'' says Mr. Andrews.
Also, the Review adds to the Harvard Business School's reputation. That's one reason other business schools would dearly love to emulate the Review. Mr. O'Toole, for instance, hopes that his new publication will improve the image of the University of Southern California's business school by being ''a bible of change,'' reflecting in shorter, more readable articles the ''managerial renaissance'' in the country.
But his immediate goal is to get the 10,000 paid subscriptions necessary to break even - a far cry from the Review's readership. Even that, he admits, is not as easy as it may seem.