Alfred Sloan

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Alfred Sloan, the chief executive at General Motors for 35 years believed that no one should be called by their first names. It was always Mr. or Mrs. He practiced this style even to his top executives. He even called the president of GM, who was later Alfred’s successor, Mr. Wilson. They did not go by first name basis. He was known for his acts of kindness, of help, and for his of advice, and just warm sympathy when people were in trouble, but he had no friends within GM when he reached his old age. Sloan did not want any friends from GM because, GM was a business and friends should not be confused with business. The Alfred Sloan’s management style is a case in which management principles are discussed and analyzed. The case deals with communication and a variety of different management styles.

Rarely has a chief executive of an American corporation been as respected and as revered as Alfred P. Sloan, Jr., was at General Motor during his long tenure at the top, which was from 1920 until 1955. Many GM managers, especially those that grew up during that same time as he did, felt a deep personal gratitude to him for his quiet, but decisive acts of kindness. Sloan kept to himself and from the entire managerial group at GM. He never called anyone by their first name and wanted to be addressed as “Mr. Sloan” even to the top executives. This way to his life was a reflection to his upbringing. He was born in the 1870s. Unlike most of the people from his generation, he also addressed the African-American race as “Mr.” and “Mrs”. Sloan had always frowned on the use of first names. When Sloan was young he was a keen outdoorsman, but all his hiking, camping, and fishing companions were with his close friends and not people from GM. Above everything, Mr. Sloan had no friends within GM. He was a warm and kind man until deafness cut him off from easy human contact. Mr. Sloan did have many close friends, but he outlived them all, since he lived well into his nineties. All of his friends were outside of General Motors. The one friend who had been with GM, Walter Chrysler, did not become a personal friend of Alfred’ until after he had left GM. Walter started his own competing car company, Chrysler, upon Sloan’s advice. As Sloan grew older, he felt increasingly isolated as his close friends died. He never invited any GM associates to his house unless it was a business meeting that had a clear business agenda. Alfred did not even sit down to have a meal with people from GM. He never accepted invitations to any of their homes or even on business trips to their hometowns. Only after his retirement in 1955, when his advancing old age made it more difficult for him to travel, did he start to invite GM people to his home in New York. When Alfred did invite these people to his house, he only wanted them to talk to him about business. They would only discuss business in the office wing of his house, since he was still a GM director and member of the top committees in GM. So the question arises, was Sloan’s management principles the correct way to handle GM?

In the following paragraphs, you will find the understanding and the management principles applicable to this case. The management principles identified in this case is corporate management, centralized operations, and forecasting and planning. Corporate management is responsible for creating policies and procedures for the business organization. The enforcement of these policies and procedures ensure employees understand the corporation’s mission and vision. Alfred Sloan’s most famous policy was not calling people by their first name. People within the GM Company (directors, officers and managers) built corporate relationships with other people on both business and personal levels. Theses people would often travel to the estate of Henry Francis du Pont, a cousin of the boss at GM during the 1910s’, but Sloan would never go, even though he was invited every single time. While other...
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