The Daily Drucker: January 28 – Controlled Experiment in Mismanagement

The story of Henry Ford, his rise and decline, and of the revival of his company is what one might call a controlled experiment in mismanagement.

The story of Henry Ford, his rise and decline, and the revival of his company under his grandson, Henry Ford II, has been told many times.  But it is not commonly realized that this dramatic story is far more that a story of personal success and failure.  It is, above all, what one might call a controlled experiment in mismanagement.

The first Ford failed because of his firm conviction that a business did not need managers and management.  All it needed, he believed, was the owner-entrepreneur with his “helpers.”  The only difference between Ford and most of his business contemporaries, in the U.S. as well as abroad, was that, as in everything else he did, Henry Ford stuck uncompromisingly to his convictions.  The way he applied them – for example, by firing or sidelining any one of his “helpers,” no matter how able, who dared to act as a “manager,” make a decision, or take action without orders from Ford – can only be described as a test of a hypothesis that ended up by fully disproving it.  In fact, what makes the Ford story unique – but also important – is that Ford could test the hypothesis, in part because he lived so long and in part because he had a billion dollars to back his convictions.  Ford’s failure was not the result of personality or temperament but, first and foremost, the result of his refusal to accept managers and management as necessary as grounded in task and function rather than in “delegation” from the “boss.”

ACTION POINT: Are you an owner-executive who treats all your employees as your helpers?  Are you an employee who is treated as a helper? List three ways your organization could be more profitable if employees are encouraged to assume responsibility.

                                               

Quoted from The Daily Drucker, January 28, page 30