You are on page 1of 37

Henry Ford was an innovator, an industrialist and an outdoorsmana farmer's son who turned his mechanical interests into

a global company that transformed life around the world. While always a dutiful contributor to the family farm, Henry's earliest exposure to his real passionmachinery and mechanicscame from visits to town with his father, where he saw some of the earliest technology of machines, engines and mills.

Henry Fords Beginnings Born in Wayne County, Michigan, in an area that later became Dearborn, on July 30, 1863, Henry Ford was the oldest of six children. Although he chose to leave the family farm and pursue his own interests, Henry never strayed far from his roots. In April 1888, Ford married Clara Bryant, a local girl and the foster child oflike HenryIrish immigrant farmers. Success soon came to him as he took a position in 1891 as an engineer at the Edison Illuminating Company and fairly quickly climbed the ranks. Greater financial security along with more freedom to explore his own experiments came with his promotion to chief engineer in 1893the same year his only child, Edsel, was born. Although he had established a solid career with good prospects at Edison Illuminating, Ford was restless and ready to venture into the field of automotive engineering, in which he had long been experimenting. He had confidence enough in

his ideas that he believed he could continue to support his family on themand of course eventually, he proved right. Driven by His Imagination With his love for the outdoors and rural values, Ford might easily have remained in agriculture, but something even stronger pulled at Ford's imagination: mechanics, machinery, understanding how things worked and what new possibilities lay in store. As a young boy, Ford took apart everything he got his hands on; he became known around the neighborhood for fixing people's watches. As he grew up, he explored every mechanical opportunity he could find, learning to fix steam engines and run mill operations. In the 1890s, he focused particularly on internal combustion engines. Edisons Encouragement "Young man, that's the thing! You have itthe self-contained unit carrying its own fuel with it! Keep at it!" These early words of encouragement came from Thomas Edison, who was to become one of Henry Ford's closest friends. At their first meeting at a convention in 1896, Ford was still an unknown. But the enthusiasm of the famous and widely respected Edison surely fueled Ford's drive. The friendship between Henry Ford and scientist and inventor Thomas Edison, which spanned more than 30 years, is almost legendary. From their earliest meetings, they encouraged and inspired one another, often contributing to each other's work. In Edison, Ford found a sympathetic mind and true friendship that transcended the boundaries of mere celebrity or fame. The first publicly released '28 Model A Ford may have gone to the movie stars, but the first one ever produced went to Edison.

Difficult Beginnings Henry Ford called his first vehicle the Quadricycle. It attracted enough financial backing for Ford to leave his engineer position at Edison Illuminating and help found the Detroit Automobile Company in 1899. The company faltered for a variety of reasons, and in 1901 Ford left to pursue his own work again. Later that year, the Henry Ford Company was born, but Henry Ford himself stayed with it only a few months. He left in early 1902 to devote more time to refining his vehicles. Henry Ford spent much of the next year or so working on his racing cars and winning some high-profile races with them. The record setting attracted serious financial backing, along with smart business partners such as James Couzens, the company's first business manager. Couzenss business acumen complemented Ford's mechanical talents, and in the early years he was largely responsible for important moves the company made in advertising, customer relations, dealer franchises and more. Within a few months of the June 16, 1903 founding of Ford Motor Company, the first Ford, a Model A, was being sold in Detroit. Although there were 87 other car companies in the United States, it soon became clear that Henry Ford's vision for the automotive industry was going to work. Bringing Cars to the Common Man What made Henry Ford successful where others had failed (or succeeded on a much smaller scale)? It wasn't just his vehicles, excellent as they wereit was his unique understanding of the potential of those vehicles to transform society. Before Ford, cars were luxury items, and most of his early competitors continued to view them that way, manufacturing and marketing their vehicles for the wealthy.

Ford's great stroke of genius was recognizing that with the right techniques, cars could be made affordable for the general publicand that the general public would want them. Ford focused on making the manufacturing process more efficient so he could produce more cars and charge less for each. Innovating a New Future Some of Ford's greatest innovations came not in the cars themselves but in the processes for creating them, like his 1914 introduction of a moving conveyor belt at the Highland Park plant, which dramatically increased production. Starting construction on the Rouge plant in 1917 was the first step toward Ford's dream of an all-in-one manufacturing complex, where the processing of raw materials, parts and final automobiles could happen efficiently in a single place. Ford was also unique in recognizing that his business was about more than just cars; it was about transportation, mobility, changing lifestyles. He anticipated the ripple effect from mass production to create more jobs that let more people afford the costeffective cars he produced. Ford pushed for more gas stations and campaigned for better roads, understanding conditions necessary for his product to make its mark. And his far-reaching vision opened his eyes to the global market, making Ford Motor Company an international enterprise far earlier than any of its competitors. At the height of Henry Ford's fame and business power, his company operated or sold in more than 30 countries around the world, including such far-reaching places as Indonesia, China, Brazil and Egypt, as well as much of Europe. Providing Opportunities for a Better Society

Henry Ford's personal motto of "Help the Other Fellow" spilled over into his management style; he recognized that policies generous to his employees would result in happier workers and a better product. He claimed, however, not to believe in conventional charity; rather he preferred to provide opportunities for people to help themselves. These are just some of the liberal innovations Ford implemented within his company:

The $5 workday, doubling the industry standard for a day's wages and bringing his hardworking employees closer to affording the cars they built. Ford considered it a way of sharing the company's profits with all those who had helped make those profits possible.

Employment policies that created opportunities for the physically and mentally handicapped and even ex-convicts.

A variety of educational facilities at the workplace, starting with the English Language School at the Highland Park plant in 1914, when he realized his largely immigrant workforce needed language skills and assistance.

A Fascinating Personality As Ford Motor Company's public image developed, much of it began to focus on the personality of the company's charismatic leader. Ford made a fascinating subject for a variety of reasons. He wasn't a "behind-the-scenes" kind of executive; rather, he stayed actively involved in company operations and was frequently on hand at milestone events. He had a forceful, outspoken personality that often expressed itself in highly quotable remarks. Moreover, his wide-ranging interests led him to explore a

variety of fieldsaviation, film, politics (including a run for the U.S. Senate)that led to associations with other celebrities and people of note. But it would be a mistake to conclude that Ford's celebrity associations involved just smiling for the camera with the latest movie stars. The list of dignitaries and personalities with whom he exchanged letters is long and impressive. Moreover, Ford had meaningful relationships with many luminaries of his time. He shared an interest in agricultural experimentation with African American educator and agriculturalist George Washington Carver. He communicated with aviation pioneers such as Wilbur and Orville Wright and Charles Lindbergh, who were consultants to the company's aviation division. America's leaders relied on Ford Motor Company's wartime production, and Ford himself was well-acquainted with several U.S. presidents. Life Beyond the Automobile Cars were always central to Henry Ford's life: He built them, he raced them, he sold them. But there was so much more to the man than his automobiles. He was a man of many interests and had a highly developed sense of curiosity; he never stopped exploring new fields and learning about new subjects. In many ways, for many years, Ford Motor Company was inseparable from the man who founded it, and Henry Ford's constant exploration of new areas and opportunities led the company into a variety of pursuits beyond just automobiles:

Ford always maintained strong ties to his rural upbringing and frequently looked for ways to support the work of farmers. In 1917, he and his son, Edsel, founded the Fordson ("Ford" and his "son") division to manufacture tractors that, like the Model T, would be lightweight and inexpensive.

Ford Motor Company's Motion Picture Department was established in 1914 with a staff of 24 that traveled worldwide producing promotional and educational short films. In the 1920s, the company was the world's largest producer of motion picturesmore than Hollywood or the New York studios! In that same period, half of all rural Americans saw a Ford film as their first motion picture ever.

Ford's fondness for small-town American life and culture is most comprehensively recorded in the Henry Ford Museum and Greenfield Village (now part of what is called "The Henry Ford"), which together form the largest museum in the country. In 1929, Ford founded The Edison Institute, a combination school and museum to allow for education through the studying of artifacts and cultural history, not just books. As he collected pieces of Americana, historic buildings, and more, this project of Ford's evolved into the sprawling cultural complex that it is today. Company and tax records show that over his lifetime, Ford poured more than $10 million of his own money into it. There was very little that Henry Ford didn't either dabble in or undertake seriously. He co-authored several books; he loved to dance and sparked a revival in oldfashioned American dancing and country fiddling; he participated actively in a variety of philanthropic ventures. What bound those interests together were curiosity and the will to learn. A Business Leader Henry Ford retired (for the first time) in 1919, when he handed over leadership of his company to his son, Edsel. Also In 1919, Henry, along with his wife and Edsel, acquired the stock of the company's minority shareholders for the astonishing (for

1919) sum of $105,820,894 and became the sole owners of Ford Motor Company truly making it a family-owned business for the first time. In 1943, after Edsel's death from cancer at age 49, Henry was persuaded to return as president of the company and showed remarkable energy for a man in his 80sbut many say he was never the same after the death of his beloved son. On September 21, 1945, the Ford Motor Company board of directors was presented with a letter from Henry Ford, resigning as president of the company and recommending Henry Ford II, Edsel's eldest son and Henry's eldest grandson, as his successor. With that, Henry Ford permanently left behind the management of Ford Motor Company. He was 82 years old. Henry Fords retirement found him as busy as ever, pursuing interests, accepting awards, satisfying his boundless curiosity. His last day was no different: He spent April 7, 1947, inspecting buildings and grounds around Dearborn that had been damaged by the worst floods in that area's history. The flood had cut off power to Ford's home, Fair Lane. He died in his bed that night by candlelight, in an odd recreation of the electricity-free world into which he had been born. An Immeasurable Legacy The impact Henry Ford had on the world is almost immeasurable. His introduction of the automobile into the mass market transformed agricultural economies in the United States and even around the world into prosperous industrial and urban ones. Many historians credit him with creating a middle class in America. His mass production techniques provided work that many people (even the less educated) could do, and he paid them well for doing it. His high minimum wages were revolutionary at the time,

but these "profit-sharing" programs set a precedent for fair distribution of company wealth that greatly influenced later management practices. And of course, there were the cars themselves. Henry Ford's curiosity and enterprising nature were directly responsible for a long list of automotive innovations, many of which we take for granted today, from the V-8 engine to safety glass. As an outdoorsman, Henry Ford was deeply conscious of the impact his industry had on the delicate natural world. He implemented practices that were progressive for his timereplacing wood with steel to conserve forests, using lighter materials to increase fuel efficiency, even prohibiting the use of crowbars to open wooden crates so as not to damage the potentially reusable lumber.

Henry Ford (July 30, 1864 April 7, 1947) was the founder of the Ford Motor Company and the father of the modern assembly lines used in mass production. His Model T eventually revolutionized transportation and American industry,

contributing to the urbanization that changed American society in the early twentieth century. He became famous for introducing higher wages for his workersnotably $5.00 a daywhich brought thousands of workers to his factories and made the automobile industry one of the largest in the nation. His intense commitment to lowering costs resulted in many technical and business innovations, including a franchise system that put a dealership in every city in North America, and in major cities on six continents.

Contents [hide]

1 Early life 2 Detroit Automobile Company and the Henry Ford Company 3 Ford Motor Company
o

3.1 Self-sufficiency 3.2 Ford's labor philosophy 3.3 The Model T 3.4 Racing 3.5 The Model A

3.6 Death of Edsel Ford

4 Ford Airplane Company 5 Peace ship 6 Anti-Semitism and The Dearborn Independent 7 Fords international business 8 Death 9 Legacy 10 Notes 11 Selected works 12 References 13 Further reading 14 External links 15 Credits

Ford's impact on the American life was immense. By paying his workers above subsistence wages, and producing cars that were priced for this new market of workers as consumers, Ford brought the means of personal transportation to ordinary people and changed the structure of society. His plan of producing a large number of inexpensive cars contributed to the transformation of major sectors of the United States from a rural, agricultural society to an urbanized, industrial one at a time when America's role in the world appeared to many to have providential significance. A

complex

personality,

often

referred

to

as

genius,

Ford

exhibited

variousprejudices and, despite his own numerous inventions and innovations, a stubborn resistance to change. His legacy, however, includes the Ford Foundation, one of the richest charitable foundations in the world, dedicated to support for activities worldwide that promise significant contributions to world peace through strengthening democratic values, reducing poverty and injustice, promoting

international cooperation, and advancing human achievement. Early life Henry Ford was born on July 30, 1863, on a farm in a rural township west of Detroit, the area which is now part of Dearborn, Michigan. His parents were William Ford (18261905) and Mary Litogot (18391876). They were of distant English descent but had lived in County Cork, Ireland. His siblings include Margaret Ford (1867 1868), Jane Ford (18681945), William Ford (18711917), and Robert Ford (1873 1934). During the summer of 1873, Henry saw his first self-propelled road machine, a steam engine generally used in the stationary mode to power a threshing machine or a sawmill, but also modified by its operator, Fred Reden, to be mounted on wheels connected with a drive chain connected to the steam engine. Henry was fascinated with the machine, and over the next year Reden taught him how to fire and operate it. Ford later said it was this experience "that showed me that I was by instinct an engineer."[1] Henry took this passion for mechanics into his home. His father had given him a pocket watch in his early teens. At fifteen, he had developed a reputation as a watch

repairman, having dismantled and reassembled timepieces of friends and neighbors dozens of times.[2]

Henry Ford, 1888 The death of his mother in 1876 was a blow that devastated little Henry. His father expected Henry to eventually take over the family farm, but Henry despised farm work. With his mother dead, Ford had little reason to remain on the farm. He later said, "I never had any particular love for the farm. It was the mother on the farm I loved."[3] In 1879, he left home for the nearby city of Detroit, Michigan to work as an apprentice machinist, first with James F. Flower & Brothers, and later with the Detroit Dry Dock Company. In 1882, he returned to Dearborn to work on the family farm and became adept at operating the Westinghouse portable steam engine. This led to his being hired by Westinghouse Electric Company to service their steam engines. Upon his marriage to Clara Bryant in 1888, Ford supported himself by farming and running a sawmill. They had a single child: Edsel Bryant Ford (18931943). In 1894, Ford became aFreemason, joining the Palestine Lodge #357 in Detroit. [4]

In 1891, Ford became an engineer with the Edison Illuminating Company, and after his promotion to chief engineer in 1893, he had enough time and money to devote attention to his personal experiments on gasoline engines. These experiments culminated in 1896 with the completion of his own self-propelled vehicle named the Quadricycle, which he test-drove on June 4 of that year. Detroit Automobile Company and the Henry Ford Company After this initial success, Ford approached Edison Illuminating in 1899 with other investors, and they formed the Detroit Automobile Company, later called the Henry Ford Company. The company soon went bankrupt because Ford continued to improve the design, instead of selling cars. He raced his car against those of other manufacturers to show the superiority of his designs. During this period, he personally drove one of his cars to victory in a race against the famous automobile manufacturer Alexander Winton (18601932) on October 10, 1901. In 1902, Ford continued to work on his race car to the dismay of the investors. They wanted a high-end production model and brought in Henry M. Leland (1843 1932) to create a passenger car that could be put on the market. Ford resigned over this usurpation of his authority. He said later that "I resigned, determined never again to put myself under orders."[5] The company was later reorganized as the Cadillac Motor Car Company. Ford Motor Company Ford, with eleven other investors and $28,000 in capital, incorporated the Ford Motor Company in 1903. In a newly-designed car, Ford drove an exhibition in which the car covered the distance of a mile on the ice of Lake St. Clair in 39.4 seconds, which was

a new land speed record. Convinced by this success, the famous race driver Barney Oldfield (18781946), who named this new Ford model "999" in honor of a racing locomotive of the day, took the car around the country and thereby made the Ford brand known throughout the United States. Ford was also one of the early backers of the Indianapolis 500 race. Self-sufficiency Ford's philosophy was one of self-sufficiency using vertical integration. Ford's River Rouge Plant, which opened in 1927, became the world's largest industrial complex able to produce even its own steel. Ford's goal was to produce a vehicle from scratch without reliance on outside suppliers. He built a huge factory that shipped in raw materials from mines owned by Ford, transported by freighters and a railroad owned by Ford, and shipped out finished automobiles. In this way, production was able to proceed without delays from suppliers or the expense of stockpiling. Ford's labor philosophy Henry Ford was a pioneer of "welfare capitalism" designed to improve the lot of his workers and especially to reduce the heavy turnover that had many departments hiring 300 men a year to fill 100 slots. Efficiency meant hiring and keeping the best workers. On January 5, 1914, Ford astonished the world by announced his $5 a day program. The revolutionary program called for a reduction in the length of the workday from 9 to 8 hours, a five-day work week, and a raise in minimum daily pay from $2.34 to $5 for qualified workers.[6] The wage was offered to men over age 22, who had worked at the company for six months or more, and, importantly, conducted their lives in a manner of which Ford's "Sociological Department" approved. They frowned on heavy drinking and gambling. The Sociological Department used 150 investigators and

support staff to maintain employee standards; a large percentage of workers were able to qualify for the program. Ford was criticized by Wall Street for starting this program. The move however proved hugely profitable. Instead of constant turnover of employees, the best mechanics in Detroit flocked to Ford, bringing in their human capital and expertise, raising productivity, and lowering training costs. Ford called it "wage motive." Also, paying people more enabled the workers to be able to afford the cars they were producing, and was therefore good for the economy. Ford was adamantly against labor unions in his plants. To forestall union activity, he promoted Harry Bennett, a former Navy boxer, to be the head of the service department. Bennett employed various intimidation tactics to squash union organizing. The most famous incident, in 1937, was a bloody brawl between company security men and organizers that became known as "The Battle of the Overpass." Ford was the last Detroit automaker to recognize the United Auto Workers union (UAW). A sit-down strike by the UAW union in April 1941 closed the River Rouge Plant. Under pressure from Edsel and his wife, Clara, Henry Ford finally agreed to collective bargaining at Ford plants and the first contract with the UAW was signed in June 1941. Death of Edsel Ford In May 1943, Edsel Ford died, leaving a vacancy in the company presidency. Henry Ford advocated long-time associate Harry Bennett (18921979) to take the spot. Edsel's widow Eleanor, who had inherited Edsel's voting stock, wanted her son Henry Ford II to take over the position. The issue was settled for a period when Henry

himself, at age 79, took over the presidency personally. Henry Ford II was released from the Navy and became an executive vice president, while Harry Bennett had a seat on the board and was responsible for personnel, labor relations, and public relations.

Henry Ford spent most of his life making headlines, good, bad, but never indifferent. Celebrated as both a technological genius and a folk hero, Ford was the creative force behind an industry of unprecedented size and wealth that in only a few decades permanently changed the economic and social character of the United States. When young Ford left his father's farm in 1879 for Detroit, only two out of eight Americans lived in cities; when he died at age 83, the proportion was five out of eight. Once Ford realized the tremendous part he and his Model T automobile had played in bringing about this change, he wanted nothing more than to reverse it, or at least to recapture the rural values of his boyhood. Henry Ford, then, is an apt symbol of the transition from an agricultural to an industrial America. Early life. Henry Ford was one of eight children of William and Mary Ford. He was born on the family farm near Dearborn, Michigan, then a town eight miles west of Detroit, on July 30, 1863. Abraham Lincoln was president of the 24 states of the Union, and Jefferson Davis was president of the 11 states of the Confederacy. Ford attended a one-room school for eight years when he was not helping his father with the harvest. At age 16 he walked to Detroit to find work in its machine shops. After three years, during which he came in contact with the internal-combustion engine for the first time, he returned to the farm, where he worked part-time for the Westinghouse Engine Company and in spare moments tinkered in a little machine shop he set up. Eventually he built a small "farm locomotive," a tractor that used an old mowing machine for its chassis and a homemade steam engine for power. Ford moved back to Detroit nine years later as a married man. His wife, Clara Bryant, had grown up on a farm not far from Ford's. They were married in 1888, and on November 6, 1893, she gave birth to their only child, Edsel Bryant. A month later Ford was made chief engineer at the main Detroit Edison Company plant with

responsibility for maintaining electric service in the city 24 hours a day. Because he was on call at all times, he had no regular hours and could experiment to his heart's content. He had determined several years before to build a gasoline-powered vehicle, and his first working gasoline engine was completed at the end of 1893. By 1896 he had completed his first horseless carriage, the "Quadricycle," so called because the chassis of the four-horsepower vehicle was a buggy frame mounted on four bicycle wheels. Unlike many other automotive inventors, including Charles Edgar and J. Frank Duryea, Elwood Haynes, Hiram Percy Maxim, and his Detroit acquaintance Charles Brady King, all of whom had built self-powered vehicles before Ford but who held onto their creations, Ford sold his to finance work on a second vehicle, and a third, and so on. During the next seven years he had various backers, some of whom, in 1899, formed the Detroit Automobile Company (later the Henry Ford Company), but all eventually abandoned him in exasperation because they wanted a passenger car to put on the market while Ford insisted always on improving whatever model he was working on, saying that it was not ready yet for customers. He built several racing cars during these years, including the "999" racer driven by Barney Oldfield, and set several new speed records. In 1902 he left the Henry Ford Company, which subsequently reorganized as the Cadillac Motor Car Company. Finally, in 1903, Ford was ready to market an automobile. The Ford Motor Company was incorporated, this time with a mere $28,000 in cash put up by ordinary citizens, for Ford had, in his previous dealings with backers, antagonized the wealthiest men in Detroit. The company was a success from the beginning, but just five weeks after its incorporation the Association of Licensed Automobile Manufacturers threatened to put it out of business because Ford was not a licensed manufacturer. He had been

denied a license by this group, which aimed at reserving for its members the profits of what was fast becoming a major industry. The basis of their power was control of a patent granted in 1895 to George Baldwin Selden, a patent lawyer of Rochester, New York. The association claimed that the patent applied to all gasoline-powered automobiles. Along with many rural Midwesterners of his generation, Ford hated industrial combinations and Eastern financial power. Moreover, Ford thought the Selden patent preposterous. All invention was a matter of evolution, he said, yet Selden claimed genesis. He was glad to fight, even though the fight pitted the puny Ford Motor Company against an industry worth millions of dollars. The gathering of evidence and actual court hearings took six years. Ford lost the original case in 1909; he appealed and won in 1911. His victory had wide implications for the industry, and the fight made Ford a popular hero. "I will build a motor car for the great multitude," Ford proclaimed in announcing the birth of the Model T in October 1908. In the 19 years of the Model T's existence, he sold 15,500,000 of the cars in the United States, almost 1,000,000 more in Canada, and 250,000 in Great Britain, a production total amounting to half the auto output of the world. The motor age arrived owing mostly to Ford's vision of the car as the ordinary man's utility rather than as the rich man's luxury. Once only the rich had travelled freely around the country; now millions could go wherever they pleased. The Model T was the chief instrument of one of the greatest and most rapid changes in the lives of the common people in history, and it effected this change in less than two decades. Farmers were no longer isolated on remote farms. The horse disappeared so rapidly that the transfer of acreage from hay to other crops caused an agricultural revolution. The automobile became the main prop of the American economy and a

stimulant to urbanization--cities spread outward, creating suburbs and housing developments--and to the building of the finest highway system in the world. The remarkable birth rate of Model T's was made possible by the most advanced production technology yet conceived. After much experimentation by Ford and his engineers, the system that had evolved by 1913-14 in Ford's new plant in Highland Park, Michigan, was able to deliver parts, subassemblies, and assemblies (themselves built on subsidiary assembly lines) with precise timing to a constantly moving main assembly line, where a complete chassis was turned out every 93 minutes, an enormous improvement over the 728 minutes formerly required. The minute subdivision of labour and the coordination of a multitude of operations produced huge gains in productivity. In 1914 the Ford Motor Company announced that it would henceforth pay eligible workers a minimum wage of $5 a day (compared to an average of $2.34 for the industry) and would reduce the work day from nine hours to eight, thereby converting the factory to a three-shift day. Overnight Ford became a worldwide celebrity. People either praised him as a great humanitarian or excoriated him as a mad socialist. Ford said humanitarianism had nothing to do with it. Previously profit had been based on paying wages as low as workers would take and pricing cars as high as the traffic would bear. Ford, on the other hand, stressed low pricing (the Model T cost $950 in 1908 and $290 in 1927) in order to capture the widest possible market and then met the price by volume and efficiency. Ford's success in making the automobile a basic necessity turned out to be but a prelude to a more widespread revolution. The development of mass-production techniques, which enabled the company eventually to turn out a Model T every 24 seconds; the frequent reductions in the price of the car made possible by economies of scale; and the payment of a living wage that raised

workers above subsistence and made them potential customers for, among other things, automobiles--these innovations changed the very structure of society. Control of the company. During its first five years the Ford Motor Company produced eight different models, and by 1908 its output was 100 cars a day. The stockholders were ecstatic; Ford was dissatisfied and looked toward turning out 1,000 a day. The stockholders seriously considered court action to stop him from using profits to expand. In 1909 Ford, who owned 58 percent of the stock, announced that he was only going to make one car in the future, the Model T. The only thing the minority stockholders could do to protect their dividends from his all-consuming imagination was to take him to court, which Horace and John Dodge did in 1916. The Dodge brothers, who formerly had supplied chassis to Ford but were now manufacturing their own car while still holding Ford stock, sued Ford for what they claimed was his reckless expansion and for reducing prices of the company's product, thereby diverting money from stockholders' dividends. The court hearings gave Ford a chance to expound his ideas about business. In December 1917 the court ruled in favour of the Dodges; Ford, as in the Selden case, appealed, but this time he lost. In 1919 the court said that, while Ford's sentiments about his employees and customers were nice, a business is for the profit of its stockholders. Ford, irate that a court and a few shareholders, whom he likened to parasites, could interfere with the management of his company, determined to buy out all the shareholders. He had resigned as president in December 1918 in favour of his son, Edsel, and in March 1919 he announced a plan to organize a new company to build cars cheaper than the Model T. When asked what would become of the Ford Motor Company, he said, "Why I don't know exactly what will become of that; the portion of it that does not belong to me cannot be sold to me, that I know." The Dodges, somewhat inconsistently, having just

taken him to court for mismanagement, vowed that he would not be allowed to leave. Ford said that if he was not master of his own company, he would start another. The ruse worked; by July 1919 Ford had bought out all seven minority stockholders. (The seven had little to complain about: in addition to being paid nearly $106,000,000 for their stock, they received a court-ordered dividend of $19,275,385 plus $1,536,749 in interest.) Ford Motor Company was reorganized under a Delaware charter in 1920 with all shares held by Ford and other family members. Never had one man controlled so completely a business enterprise so gigantic. The planning of a huge new plant at River Rouge, Michigan, had been one of the specific causes of the Dodge suit. What Ford dreamed of was not merely increased capacity but complete self-sufficiency. World War I, with its shortages and price increases, demonstrated for him the need to control raw materials; slow-moving suppliers convinced him that he should make his own parts. Wheels, tires, upholstery, and various accessories were purchased from other companies around Detroit. As Ford production increased, these smaller operations had to speed their output; most of them had to install their own assembly lines. It became impossible to coordinate production and shipment so that each product would arrive at the right place and at the right time. At first he tried accumulating large inventories to prevent delays or stoppages of the assembly line, but he soon realized that stockpiling wasted capital. Instead he took up the idea of extending movement to inventories as well as to production. He perceived that his costs in manufacturing began the moment the raw material was separated from the earth and continued until the finished product was delivered to the consumer. The plant he built in River Rouge embodied his idea of an integrated operation encompassing production, assembly, and transportation. To complete the vertical integration of his empire, he purchased a railroad, acquired

control of 16 coal mines and about 700,000 (285,000 hectares) acres of timberland, built a sawmill, acquired a fleet of Great Lakes freighters to bring ore from his Lake Superior mines, and even bought a glassworks. The move from Highland Park to the completed River Rouge plant was accomplished in 1927. At 8 o'clock any morning, just enough ore for the day would arrive on a Ford freighter from Ford mines in Michigan and Minnesota and would be transferred by conveyor to the blast furnaces and transformed into steel with heat supplied by coal from Ford mines in Kentucky. It would continue on through the foundry molds and stamping mills and exactly 28 hours after arrival as ore would emerge as a finished automobile. Similar systems handled lumber for floorboards, rubber for tires, and so on. At the height of its success the company's holdings stretched from the iron mines of northern Michigan to the jungles of Brazil, and it operated in 33 countries around the globe. Most remarkably, not one cent had been borrowed to pay for any of it. It was all built out of profits from the Model T. Later years. The unprecedented scale of that success, together with Ford's personal success in gaining absolute control of the firm and driving out subordinates with contrary opinions, set the stage for decline. Trusting in what he believed was an unerring instinct for the market, Ford refused to follow other automobile manufacturers in offering such innovative features as conventional gearshifts (he held out for his own planetary gear transmission), hydraulic brakes (rather than mechanical ones), six- and eight-cylinder engines (the Model T had a four), and choice of colour (from 1914 every Model T was painted black). When he was finally convinced that the marketplace had changed and was demanding more than a purely utilitarian vehicle, he shut down his plants for five months to retool. In December 1927 he introduced the Model A. The new model enjoyed solid but not spectacular success.

Ford's stubbornness had cost him his leadership position in the industry; the Model A was outsold by General Motors' Chevrolet and Chrysler's Plymouth and was discontinued in 1931. Despite the introduction of the Ford V-8 in 1932, by 1936 Ford Motor Company was third in sales in the industry. A similar pattern of authoritarian control and stubbornness marked Ford's attitude toward his workers. The $5 day that brought him so much attention in 1914 carried with it, for workers, the price of often overbearing paternalism. It was, moreover, no guarantee for the future; in 1929 Ford instituted a $7 day, but in 1932, as part of the fiscal stringency imposed by falling sales and the Great Depression, that was cut to $4, below prevailing industry wages. Ford freely employed company police, labour spies, and violence in a protracted effort to prevent unionization and continued to do so even after General Motors and Chrysler had come to terms with the United Automobile Workers. When the UAW finally succeeded in organizing Ford workers in 1941, he considered shutting down before he was persuaded to sign a union contract. During the 1920s, under Edsel Ford's nominal presidency, the company diversified by acquiring the Lincoln Motor Car Company, in 1922, and venturing into aviation. At Edsel's death in 1943 Henry Ford resumed the presidency and, in spite of age and infirmity, held it until 1945, when he retired in favour of his grandson, Henry Ford II. Henry Ford was a complex personality. Away from the shop floor he exhibited a variety of enthusiasms and prejudices and, from time to time, startling ignorance. His dictum that "history is more or less bunk" was widely publicized, as was his deficiency in that field revealed during cross-examination in his million-dollar libel suit against the Chicago Tribune in 1919; a Tribune editorial had called him an

"ignorant idealist" because of his opposition to U.S. involvement in World War I, and while the jury found for Ford it awarded him only six cents. One of Ford's most publicized acts was his chartering of an ocean liner to conduct himself and a party of pacifists to Europe in November 1915 in an attempt to end the war by means of "continuous mediation." The so-called Peace Ship episode was widely ridiculed. In 1918, with the support of Pres. Woodrow Wilson, Ford ran for a U.S. Senate seat from Michigan. He was narrowly defeated after a campaign of personal attacks by his opponent. In 1918 Ford bought a newspaper, The Dearborn Independent, and in it published a series of scurrilous attacks on the "International Jew," a mythical figure he blamed for financing war; in 1927 he formally retracted his attacks and sold the paper. He gave old-fashioned dances at which capitalists, European royalty, and company executives were introduced to the polka, the Sir Roger de Coverley, the mazurka, the Virginia reel, and the quadrille; he established small village factories; he built one-room schools in which vocational training was emphasized; he experimented with soybeans for food and durable goods; he sponsored a weekly radio hour on which quaint essays were read to "plain folks"; he constructed Greenfield Village, a restored rural town; and he built what later was named the Henry Ford Museum and filled it with American artifacts and antiques from the era of his youth when American society was almost wholly agrarian. In short, he was a man who baffled even those who had the opportunity to observe him close at hand, all except James Couzens, Ford's business manager from the founding of the company until his resignation in 1915, who always said, "You cannot analyze genius and Ford is a genius." Ford died at home on April 7, 1947, exactly 100 years after his father had left Ireland for Michigan. His holdings in Ford stock went to the Ford Foundation, which had

been set up in 1936 as a means of retaining family control of the firm and which subsequently became the richest private foundation in the world. To fordize: to standardize a product and manufacture it by mass means at a price so low that the common man could afford to buy it. 1. Taylorism (after Frederick Winslow Taylor): the application of segmentation and "time-and-motion" studies to the production process. 2. the line: developing the production process "like a river and its tributaries." 3. the conveyer belt: adopting the Chicago meatpackers overhead trolley to auto production. 1914: Ford installs first automatic conveyer belt.

PRICE OF A MODEL-T. * 1910-11: $780 * 1911-12: $690 * 1912-13: $600 * 1913-14: $550. * 1914-15: $360.

In 1914 the Ford Motor Company with 13,000 employees produced 267,720 cars; the other 299 American auto companies with 66,350 workers produced only 286,770 cars. Ford had 48% of US car market, Company has $100 million in annual sales. THE ROUGE RIVER PLANT. * "Ford's industrial masterpiece." Opened 1918 and reaches full capacity by mid1920s. * 1.5 miles long by .75 miles wide. A steel, glass, auto plant all in one. * "Here is the conversion of raw materials into cash in approximately 33 hours.

In 1913 the labor turnover at Ford was 380%! Solution (1914): $5 a day (double existing pay) A successful public-relations gesture; "the smartest cost-cutting move I ever made." Ford's Sociology Department: a spying dept that fired employees if they had union sympathies, had personal problems in finance or health, gambled, got drunk. 1922: high point for Ford's sales. 1. stagnant technology: refusal to change basic Model T technology until too late. Model A introduced 1927. 2. poor management: the practioner of social darwinism; no standardized accounting system; contempt for workers. Hosti 3. cronyism & gangsterism: association with dubious "yes-men." Harry Bennett's truncheons and guns. 4. Soressen joins GM. Edsel Ford undermined. 5. Increasing eccentricity. 6. Plant floor run by intimidation not cooperation FAMOUS FORD QUOTES. "Every time I reduce the price of the car by one dollar I get one thousand new buyers" "Buy a Ford - spend the difference." "A Ford will take you everywhere except into society." Thinking men know that work is the salvation of the race, morally, physically, socially."

"Men work for two reasons. One is for wages, and one is for fear of losing their jobs." "Study the history of almost any criminal, and you will find an inveterate cigarette smoker." "When there is something wrong in this country, you'll find the Jews." "The Depression is good for the country. The only problem is that it might not last long enough in which case people might not learn enough from it." (on accountants): "I want them all fired. They're not productive, they don't do any real work. Get them out of here today." "If there is unemployment in America, it is because the unemployed do not want to work." Ford was the nominal coauthor of three books in collaboration with SAMUEL CROWTHER: My Tomorrow (1926, Life reprinted and Work (1922, reprinted 1987), Today and

1988),

and Moving

Forward (1930).

Especially

recommended studies of his life and activities are ALLAN NEVINS and FRANK ERNEST HILL, Ford: The Times, the Man, the Company (1954), Ford: Expansion and Challenge, 1915-1933 (1957), and Ford: Decline and Rebirth, 1933-1962 (1963); CAROL W. GELDERMAN, Henry Ford: The Wayward Capitalist (1981), a fulllength biography and a study of his company's development;WILLIAM GREENLEAF, Monopoly on Wheels (1961), a discussion of the Selden patent case. DAVID L. LEWIS, The Public Image of Henry Ford (1976), examines the media's portrayal of Ford and his company as well as the company's efforts to influence that portrayal.

Leadership lessons from Henry Ford Follow us! 1 2 0 Throughout my leadership journey, Ive had many opportunities to study history, thanks to many of the Leaders in LIFE who understand the importance of learning history. Its been said that those who dont learn from history, are doomed to repeat it. Ive also heard many times that the lesson is repeated until the lesson is learned. How true on both accounts!

One of my favorite historical leaders to read about is Henry Ford. Even though I wasnt much of a history nut as a kid, something about Henry Fords involvement with automobiles, always interested me. I quickly learned that Henry Ford did not invent the automobile. He didnt even invent the assembly line. But more than any other single individual, he was responsible for transforming the automobile from an invention of unknown utility into

an innovation that profoundly shaped the 20th century and continues to affect our lives today. Innovators change things. They take new ideas, sometimes their own, sometimes other peoples, and develop and promote those ideas until they become an accepted part of daily life. Innovation requires self-confidence, a taste for taking risks, leadership ability and a vision of what the future should be. Henry Ford had all these characteristics, but it took him many years to develop all of them fully. As I learn more about Mr. Fords life, there were other things I didnt know. For Instance: Henry Ford was a complex and at times, contradictory personality with a wide range of interests and strongly held opinions. You probably know about Fords achievements in automobile production, but As a child, he was inspired by his mother, who encouraged his interest in tinkering. His father was a farmer. He encouraged Henrys interest in the use of machines on the farm. He was inspired by steam-powered tractors when he was a teenager. This made him think about the way things work. He was fired from his first job. Henry built his first gasoline engine at home and tested it in the kitchen. He mounted it on the kitchen sink. Thomas Edison was Henry Fords role model and later his close friend.

He built and drove race cars early in his career to demonstrate that his engineering designs produced reliable vehicles. He failed with his first two companies before he succeeded with Ford Motor Company. The idea for using a moving assembly line for car production came from the meatpacking industry. He financed a pacifist expedition to Europe during WWI. He adopted a paternalistic policy to reform his workers lives both at home and at work. He was an unsuccessful candidate for the United States Senate in 1918. He owned a controversial newspaper, The Dearborn Independent, that published antiJewish articles which offended many and tarnished his image. He promoted the early use of aviation technology. Henry Ford built Village Industries, small factories in rural Michigan, where people could work and farm during different seasons, thereby bridging the urban and rural experience. He sought ways to use agricultural products in industrial production, including soybean-based plastic automobile components such as this experimental automobile trunk. He was one of the nations foremost opponents of labor unions in the 1930s and was the last automobile manufacturer to unionize his work force.

Ford mobilized his factories for the war effort and produced bombers, Jeeps, and tanks for World War II. He established schools in several areas of the country that provided educational experiences based on traditional one room school techniques, modern teaching methods, and learning through doing. He established an indoor/outdoor museumThe Henry Fordto preserve historical items that illustrated the American experience and American ingenuity. Wow, that was probably more than most people cared to know, but interesting none the less. However, there are some great leadership lessons to be learned and applied from Henry Fords life. His timeless quotes can inspire and motivate everyone to accomplish great things. Here are some of his quotes to aid you on your leadership journey. Enjoy!

On Failure:

Failure is only the opportunity to begin again more intelligently. Even a mistake may turn out to be the one thing necessary to a worthwhile achievement.

There are no dead ends. There is always a way out. What you learn in one failure you utilize in your next success.

Obstacles are those frightful things you see when you take your eyes off your goal.

When everything seems to be going against you, remember that the airplane takes off against the wind, not with it.

On Lifelong Learning:

Education is not something to prepare you for life; it is a continuous part of life.

Anyone who stops learning is old, whether at twenty or eighty. Anyone who keeps learning stays young. The greatest thing in life is to keep your mind young.

All that I personally own of any value is my experience, and that cannot be taken away. One should not complain of having ones fund of experience added to.

On Success:

It has been my observation that most people get ahead during the time that others waste.

If everyone is moving forward together, then success takes care of itself. My best friend is the one who brings out the best in me..

Dont find fault, find a remedy.. Quality means doing it right when no one is looking. Paying attention to simple little things that most men neglect makes a few men rich.

Whether you think you can or think you cant, youre right. You say I started out with practically nothing, but that isnt correct. We all start with all there is. Its how we use it that makes things possible.

On Passion:

You can do anything if you have enthusiasm. Enthusiasm is the yeast that makes your hopes rise to the stars.

On Character:

The greatest thing we can produce is character. Everything else can be taken away from us.

On Courage:

One of the greatest discoveries a man makes, one of his surprise, is to find he can do what he was afraid he couldnt do.

On Initiative:

The unhappiest man on earth is the one who has nothing to do.

I am looking for a lot of men who have an infinite capacity to not know what cant be done.

On Teamwork:

Coming together is a beginning. Keeping together is progress. Working together is success.

You can take my factories, burn up my buildings, but give me my people and Ill build the business right back again.

On Personal Responsibility:

What I greatly hope for these children, and for children everywhere, is a new attitude toward life free from the gullibility which thinks we can get something for nothing; free from the greed which thinks any permanent good can come of overreaching others.

You will find men who want to be carried on the shoulders of others, who think that the world owes them a living. They dont seem to see that we must all lift together and pull the weight.

The genius of the American people is self-reliance. The old principles that made us great self-direction and self-help are still contemporary and valid.

Chop your own wood and it will warm you twice.