Henry Ford was one of the prominent engineers and businessmen of his time. His contribution in the development of the modern industry and car manufacturing can hardly be underestimated. Moreover, Henry Ford was the person, who defined the historical development of the world economy and capitalism making the mass production a part of the modern culture. In fact, he was the first person who had ever introduced the mass production in practice. The change of the production process and the management style developed by Henry Ford were totally for his epoch and the innovations introduced by Henry Ford provided him with ample opportunities to make his company the leader in the car manufacturing industry. At the same, while analyzing the work of Henry Ford and his innovations, it is important to lay emphasis on the fact that his ideas influenced not only the development of his own company, but also the development of the car manufacturing industry and the national economy at large, while in a long-run perspective, innovations introduced by Henry Ford within his company were borrowed en mass in other countries. As a result, today, the revolutionary idea of Henry Ford leading to the creation of the first assembling line and the mass production of cars became a key element of the modern production process since the modern mass production would be impossible if the world stumbled in the craft production, which was the only way of production prior to Henry Ford. In such a way, Henry Ford had proved to be an innovative leader and talented manager, who had managed to change the traditional approach to the organizational structure and production process and took the lead in introduction innovations in his company that brought him tremendous success.
First of all, it is important to dwell upon the personality of Henry Ford and his life before he had started to succeed in his business. Henry Ford was born in 1863 to the family of farmers. In spite of the efforts of his father to make him his follower in managing the farm, Henry Ford still refused from such a prospect. Instead, he was interested in engineering. At the age of fifteen, his father gave him a pocket watch, which Henry admired and he repaired watches of his neighbors at the time (Bak, 2003). In such a way, he manifested his engineering inclinations. No wonder, he decided to become an engineer, when he grew older. At the same time, Henry Ford was very concerned with starting his own business because he had plenty creative ideas, which could be helpful for his business and which he believed to bring him a tremendous success in his business development.
Nevertheless, he did not have an opportunity to start his business on his own and he had to work first and to make a career to raise funds for his own business. He started his work in the Edison Illuminating Company in 1891, where he got promotion to the chief engineer in two years. He held the position of the chief engineer in 1893 and he was quite successful in this position (Bak, 2003). However, Henry Ford felt the urge to launch his own business to implement his creative ideas and start his own company, where he could conduct experiments and use new approaches to business. In fact, he was not only a gifted engineer but he was also quite successful manager. Moreover, he was probably even a more successful manager than an engineer, although his achievements in both fields can hardly be underestimated.
Henry Ford conducted experiments with gasoline engines, which culminated in the creation of a self-propelled vehicle, which Ford called Ford Quadricycle in 1896 (Northouse, 2009). Later, he test drove the vehicle and improved it consistently. The same year he was introduced to the board of the company and Edison supported Ford’s experiments. In such a way, Henry was encouraged to carry on his experiments to create his first vehicle but his dream was not only to construct the vehicle but also to start its mass production that would make Ford’s invention useful and highly profitable. In fact, his desire to experiment and to create a vehicle was closely intertwined with his desire to earn money due to his inventions (Bak, 2003). Gradually, he managed to create his first car but he kept progressing and he focused on the creation of his own company manufacturing cars. Eventually, he created his company manufacturing cars.
On analyzing the existing opportunities Henry Ford used to gain the advantageous position compared to his competitors, it is important to lay emphasis on the fact that the major condition of the overall success of Henry Ford’s company was the efficient introduction of innovations, which allowed the company to outpace consistently all its rivals and take the leading position in the industry. To put it more precisely, the development of the automobile industry confronted numerous difficulties because the industry could not develop fast as long as cars were unavailable to mass customers. In fact, people could not afford buying cars en mass. In this respect, it is necessary to take into consideration several factors. Firstly, cars were mainly produced for representatives of the upper- and middle-upper classes and the cars were mainly supposed to be used within cities with well-developed roads network. Secondly, the price of cars was high and unaffordable for an average American. In addition, manufacturers could not develop the production of cars en masse. In fact, the car manufacturing was rather an exclusive process and the mass production of commodities available to large masses of customers.
In such a context, Henry Ford had managed to find solutions to the aforementioned problems, which allowed him to outpace consistently his rivals. First of all, it is necessary to dwell upon the technological innovations in the production process, which opened larger opportunities for the production of cars en masse. What is meant here is the fact that Henry Ford was the first person who introduced the assembling line in his plant. The assembling line allowed produce vehicles faster and, what was more important, the assembling line allowed the development of the mass production. In such a way, Henry Ford had improved consistent the production process.
At this point, it is worth mentioning the fact that the introduction of the assembling line did not just open the opportunity for the mass production of cars, but it also provided the company with significant benefits. On the one hand, the assembling line simplified the process of assembling vehicles substantially since each employee should perform quite a simple set of functions regularly. As a result, employees learned their functions and performed them automatically without making efforts beyond the defined set of their professional functions. Therefore, employees did not need the high qualification to be employed by Ford and perform the defined tasks perfectly well. On the other hand, the socioeconomic situation also contributed to the fast development of Ford’s company. In fact, the development of Ford company was accompanied by the increase of the labor force in the US due to the large number of immigrants from Europe. Taking into consideration the fact that employees working at Ford’s assembling lines did not need high professional qualification due to the simplicity of their work, the company could hire a large number of employees and save costs due to the low price Ford paid for the labor force. It was obvious that the company could save substantial costs by means of employing immigrants who agreed to work for lower wages compared to American employees. In such a situation, Ford could and did start the mass production of cars and saved costs on labor force.
As a result, he got a strategic over its competitors because his company could offer a totally new product, manufactured on the assembling line and targeting at mass consumers. Moreover, Ford could offer his car at lower price compared to competitors. Therefore, he easily extended his target market and gained the larger share of the market nationwide, while competitors kept using the production process which was characterized by significant backwardness compared to the production process introduced by Ford, while cars produced by his competitors were consistently more expansive than Ford’s cars. Finally, it is important to remember that Ford’s model T was destined to mass consumers, while other competitors kept offering exclusive products which were mainly destined to representatives of upper class.
At the same time, it is obvious that the organizational technology developed by Henry Ford was the main condition of his success, which gave him a strategic advantage over his competitors. In this respect, it should be said that Henry Ford was an adept of rationalism in the development of his organizational technology. In fact, he made the production process perfectly rational, where not a single employee or minute was lost in vain. In stark contrast, the entire plant worked as a solid machine where each employee performed his or her own tasks and functions. The introduction of assembling line, which became the core of the production process, around which the organizational technology was developed, defined organizational and technological development of the company.
Speaking about the organizational factors which influenced the organizational technology of Ford’s company, it is possible to single out the system of control and high efficiency of the organization of work. To put it more precisely, the organization of the mass production by means of the assembling line contributed to the increase of the control over the performance of employees. In fact, each employee performed his or her specific functions being under the permanent control because, as soon as an employee failed to perform his or her tasks well or made an error, this failure could be easily identified at the next stage of the assembling line. Therefore, the assembling line increased the level of control over employees’ performance. At the same time, work was organized very efficiently. As it has been already mentioned above, employees should perform relatively simple functions. At any rate, they had to perform only a few specific functions that allowed Ford to hire employees without high qualification and these employees could be easily trained to perform a few simple tasks. Such simplicity definitely contributed to the consistent increase in the efficiency of the organization of work.
As for technological factors, it should be said that simplicity was introduced not only at the organizational but also technological level. In fact, Ford introduced standardized model and details, which were essential for the mass production. As a result, standardization allowed the company to save times, because Ford did not need to invent new models since the standard ones were used and the company could save costs because engineers should not test new models but simply control the quality of standard models, while any new model was produced en masse and costs of its testing were returned fast due to the mass production of this detail. Secondly, Ford focused on the introduction of the enclosed cycle of production that a very important technological change. In fact, he refused from outside suppliers that increased reliability of supply and allowed saving costs since the company should not spend money on outside suppliers. In addition, the enclosed production system allowed the company to control the high quality of products supplied to Ford’s plants.
Furthermore, Henry Ford attempted to develop simple but efficient structural configuration. For this purpose he created an organizational hierarchy, where each professional performed his or her own tasks. This hierarchy was very strict and did not need consistent changes in the course of production and in the course of the development of the company. In this structural configuration, employees were rather supplements to machines, with the help of which cars were manufactured, while the function of managers was mainly related to the control over employees’ performance. At the same time, employees had to develop their professional skills through drilling and repetition of their actions day after day. As a result, Henry Ford had managed to create a simple structural configuration, with a simple but strict organizational hierarchy. At the time of Henry Ford, such structural configuration proved to be highly efficient because employees were not supposed to be creative. In stark contrast, the only thing they should do well was a set of specific tasks or actions which they should perform automatically. In such a context, what this structural configuration needed was the efficient system of control which was maintained by managers and which was relatively simple and efficient due to the functioning of the assembling line, where there was no room for error or poor performance. In addition, managers performed their control functions well enough to maintain the production process.
Finally, it should be said that the production, organization and structural configuration developed by Henry Ford mirrored his personal philosophy. In this respect, it is obvious that rationalism was the milestone of Ford’s philosophy. His rationalism can be traced in every element, every detail of his organization. For instance, it is possible to refer to the production process, where there were no unnecessary actions to be made by employees. Or else, the attempt of Ford to refuse from services of outside suppliers was also subject to his rationalism, since it was the only efficient way to minimize costs of production, stabilize the supply chain and ensure the permanent mass production. Furthermore, it is possible to refer to one of the most successful models developed by Ford, his Model T, which became very popular in the US. In fact, this model became the personification of Ford’s rationalism because it proved to be a truly universal model which was destined to mass consumers. This model could be used by farmers, businessmen and average Americans for various purposes. Model T was simple but very efficient means of transportation.
Thus, it is obvious that Henry Ford, being an adept of rationalism, developed this philosophy and extrapolated it on the production process and organizational structure of his company. In fact, it is probably due to his rationalism Henry Ford had managed to achieve such a tremendous success because he was the first person who introduced the assembling line, which was perfectly rational and which was the backbone of the mass production process developed by Ford. In this regard, it should be said that the idea of mass production was not really new, but it was Henry Ford, who made this idea or dream come true. As a result, the implementation of his innovative ideas brought him tremendous success and put his company into an advantageous position compared to his rivals. In fact, Henry Ford has managed to create his own company and implement his ideas that brought him huge profits and wealth.
Bak, R. (2003). Henry and Edsel: The Creation of the Ford Empire. Wiley
Northouse, G. (2009). Leadership Theory and Practice. New York: Routledge.