COMPARISON OF TWO LEADERS:
POWER GAINED AND LOST (CP8)
The words in this case are primarily taken directly from the sources in the bibliography. I make no claim of originality, other than selecting excerpts and weaving them into a case. It would interfere with the use of the case to clutter it with hundreds of footnotes, so they were not included. The case is intended to illustrate two contrasting leadership styles (of Henry Ford and Alfred P. Sloan, Jr.) and some of their effects at pivotal times in the life of two prominent companies (Ford Motor Company and General Motors). Actually, we could speak of three contrasting leadership styles. While Sloan(s style seems quite consistent over his life, Ford operated rather differently in the 1920s and 1930s than he did prior to this - although core elements of his leadership style are present throughout both periods. Please note the questions at the end.
Ford to 1920
Henry Ford was born on a farm near Dearborn, Michigan on 30 July 1863, one of eight children in an undistinguished family. He died at his Detroit home on 7 April 1947. He was educated in the local public school, where he learned mathematics and also a little reading and writing. Barely literate when he finished school in 1879, he was fascinated by machinery and determined to find work as a mechanic. At the age of sixteen he apprenticed at Flower Brothers Machine Shop in Detroit, and later at the Detroit Drydock Company; he also took a part-time job as a watch repairman. Returning home in 1882, Ford first set up a small machine shop and later took a job with Westinghouse as a district engineer. In 1888 he married Clara Bryant; they had one son, Edsel Bryant Ford, in 1893 - by which time he was chief engineer for the Chicago area with the Edison Illuminating Company. By the 1890s invention fever was sweeping the United States. Ford(s simple design for a transmission led to his development of a working automobile in 1896. Ford promptly sold it to raise capital for further experiments, and continued to make and sell experimental prototypes in this fashion for some years. In 1899, with capital provided by a Detroit lumber dealer, Ford established the Detroit Automobile Company and resigned from Edison to become the new firm(s superintendent in charge of production. This first attempt by Ford at producing motor cars on a commercial basis was a total failure, largely because Ford knew nothing about production and managed to make only a handful of cars. Undeterred, Ford and his backers tried again, setting up the Henry Ford Company in 1900. Again, few cars were actually built, but one of these proved to be a very successful racing car. Ford became suddenly enthusiastic about motor racing and neglected his business, and accordingly was fired from the Henry Ford Company in 1902. His racing car triumphs under his belt, Ford seems to have gone back to his original plan, which was to build cheap, efficient cars that could be sold widely on an affordable basis. With fresh backing, Ford established the Ford Motor Company in Detroit in June 1903. Ford provided the engineering and production knowledge, and was appointed vice-president and general manager. The new company was almost immediately embroiled in a patent suit with the Association of Licensed Automobile Manufacturers (ALAM), backed by rivals such as Packard and Olds Motor Company, which claimed to have sole rights to manufacture gasoline-powered automobiles. Ford, who had earlier applied to join ALAM and been turned down, decided to fight the suit. He eventually won his case in 1911; in the meantime, typically, Ford continued on with his own plans as though the problem did not exist. Ford went ahead with the development of the Model N, a cheap runabout that went on sale in 1906 for $600. To cut costs, Ford began a policy of vertical integration by taking over some of his main suppliers. Ford acquired the services of yet another...
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