Category Archives: Leadership

Leaderhip and Ford – A case study

Leader

Introduction.

Very often I see posts in social media about the supposed characteristics of a true leader.

Assertions that a true leader “Does not push, but pulls”, “Does not direct but inspires”, “Does not intimidate, but persuades” populate the net and posters without any backing such assertions, I think most of them are aspirational lists or wishful thinking of the boss someone would love to have, or the executive someone wish they could become. The problem is, I have worked with some leaders who act very differently.

Regardless my personal experience, historical references about leaders that behaved very different include FDR and Steve Jobs.

I want to clarify, I am not against learning how to be a more effective or humane leader, I just don’t think posting a nice list in Twitter makes it a golden rule.

But for this post I want to explore the characteristics or traits needed to be a leader.

Leader vs. manager

I think it’s fair to mark a difference between a leader and a manager. It’s common that companies call management formal leaders . In the most strict definition, the role of leader and manager are opposite; a leader is a guide through transition or change.  A manager is a guardian of the status quo.

Business take the term formal leader from the military, with the difference that people in the military are taught to command their troops to  successfully maintain the discipline and the focus on the mission target within the ever changing conditions of battle. Preparing monthly reports and keep the budget under control while trying to minimize unexpected changes to avoid getting analysts and investors nervous tends to be the opposite.

Some managers become leaders when facing certain conditions and challenges, but not all and not all the time.

Ford vs. Ford

A very interesting example of different types of leadership comes from the origins of the Ford Motor Company.

Henry Ford was born in a modest country home and his curious mind took him from learning on his own how to put apart a clock and put it back together, to working for Edison.

Henry Ford had a vision of developing an affordable car for the masses. In his time, cars were crafted expensive toys for rich people.

He failed in producing cars fast enough on his first attempt, but he didn’t abandon his vision. Instead, constructed a race car which he ran successfully to raise awareness of his Ford brand until he attracted enough attention to get the investors needed to open the doors of Ford Motor Company in 1903.

Henry Ford was an engineer and he was mainly concerned with practicality and functionality. Instead of luxury vehicles, he valued practical design and so he focused on one car; the model T. He raised the salary of his workers. The lowest pay at the Ford Motor Company was $5 per hour creating a salary growth that started America’s economic growth by expanding the middle class. He started raising the salaries because he was interested in getting people’s loyalty to his project, as well as making sure that he could attract the best of the best to work for him. He also expected that Ford employees would be able to afford buying a car of their own.

Henry Ford kept his vision of what life should be from his modest origins. He never drank alcohol, he never gave up to the luxury life he could have afforded, he was a very private man, he ate natural things and he was very loyal to his family. He stayed married to his wife Clara until his death. He kept a set of values he learned in his youth.

On the flip side, Henry Ford always kept tight control of his company ignoring every opinion but his own and he was strongly anti-union. Ford Motor Company was his vision and he was not going to let the employees dictate the path of the company.

Edsel Bryant Ford was the only son of Henry Ford. He assumed the title of President of Ford Motor Company since he was 25. He grew with privilege and he joined the group of capitalists from his time, he behaved like one of the Captains of Industry -term coined during his period- assisting frequently to social gatherings, drank fine spirits, dined in good restaurants.

At work Edsel Ford was more interested in design than engineering. Facing competition in his time from General Motors and Dodge/Chrysler, he diversified the types of vehicles Ford produced. Broke the rule “you can have one of our cars in any color you want, as long as it’s black” (famous quote from his father). Edsel understood he had to earn the customer’s favor over his competitors and he attracted different customers by providing multiple options, diversifying styles, models, colors and providing optional accessories. Edsel had a vision of taking the company into the future.

His management style was a lot more inclusive in the decisions than his father’s dictatorial style. Most people preferred to work with Edsel than with Henry. They felt their ideas were respected and they could work together with Edsel.

A toxic combination.

For many years, Henry Ford undermined Edsel’s decisions and even though Edsel held the President’s office, it was clear Henry was in control. Henry Ford saw his son’s management style as a sign of weakness and his social life not as a sign of the times, but as an improper way for a gentleman’s behavior. He criticized his son at work and outside. Regardless Henry Ford efforts, competition, the depression, the marketing conditions, World War II and many circumstances pulled the company toward Edsel’s vision of a diversified, growing, international company.

Many biographers question if Henry Ford’s mental health deteriorated with aging. He became paranoid and worrying that his employees wanted to take over or short change him, so he created a department that was formed by bouncers, former boxers and the like, who started terrorizing the employees. Working at Ford Motor Company was comparable to hell, according to some former employees.

When there were attempts to unionize Ford’s workers, the said group assaulted and injured the union leaders causing a major social discontent with the company.

Pressure to allow a union mounted even more in 1941. Henry Ford as the main stockholder refused to allow the unions take presence in his company and said that he’d rather close the whole company than allowing a union. The next day after making that statement he went back and signed a union agreement providing all what the union requested and more. So was born the UAW. Some years later when asked what made him change his mind, he said “Clara said she would leave me if I didn’t”. He put his family union before his lifelong work and vision.

As Henry Ford was growing older and more paranoid, Edsel started gaining more and more control over the company Henry retired in 1941 after suffering a stroke.

Edsel had some health problems of his own. He developed stomach cancer and liver cancer. He kept his diagnosis hidden from his father. Maybe due to a broken relationship with his father, or if he just didn’t want pity, it’s hard to guess the real reason. Henry Ford was only aware that his son had health problems and blamed his illness on his loose living style. He insisted private and publicly that Edsel could be cured if he just abandoned his fancy food, avoided all alcohol and returned to a more natural food. Ironically, the trigger of Edsel’s death in 1943 was a complication of cancer with an infection he got from drinking some of his father’s recommended raw milk.

Henry Ford never really recovered from his son’s death, but he resumed the presidency of the company with more erratic and paranoid behavior. He was forced to resign and his grandson Henry Ford the Second took the helm of the company.

The end of an era

Henry Ford died of a cerebral hemorrhage in 1947.

For his funeral, almost all Detroit made 12 hours line to spend a few seconds paying their respects in front of his open casket, Almost all Detroit stopped during his wake and even people who didn’t attend his wake stopped work for a minute of silence. He was regarded as an inspiration, a visionary and a force for the economic growth of the whole country. His violent reactions to union organizers and employees were a little less relevant compared to his legacy.

Ford and Ford. The traits of a leader.

Something that I find very interesting is that Edsel was a lot closer to the type of leader social media refer as the ideal, mentioned in the introduction. But despite his opposite style, it was Henry Ford’s death that moved people, in Detroit and most of the country.

Both father and son were leaders on their own right, at different times and they represented different projects, So, being so different, what made them both leaders?

Both had a vision that could not be accomplished on their own, they required a group of people, an entire company. The visions were different and according to the times, Henry had a vision of an affordable mass produced car and a society with enough buying power to afford them. Edsel had a vision of a diversified company that could win clients over his competitors locally and overseas.

Both put hands on to accomplish their vision. Henry Ford failed at first and used the race car to raise awareness of his brand and ultimately the funds needed to create his dreamed company, Edsel failed at first undermined by his father but instead of quitting and going to work somewhere else, he kept pushing and pushing until he achieved his vision for the company.

Both had a set of values. Henry was guided by his humble origins and his adherence to his family, Edsel adhered to the vision of the captains of industry, he adopted the values of his time.

Both received pressure to change but they resisted (as much as they could) to live to someone else’s expectations.

I derive from their life story that being a leader requires following traits:

  • A vision that requires a team and passion for that vision.
  • Taking action. Visionaries without action are dreamers, not leaders.
  • Having a set of guiding values.
  • Being true to yourself.

There is much that can be learned from leadership education; there is value in being humane, kind, positive, and in general a decent human being on top of being a leader. But above all, a true leader will remain true to him/herself.