Businessman of the 20th Century - Essay Example

Henry Ford was s as “Businessman of the 20th Century” by Fortune magazine in the year 1999. He was born in the year 1863. Henry Ford is a household name when it comes to cars, automobiles assembling and earning respect for innovation and motivational leadership. Henry Ford was a man who proved through his leadership of his venture that innovation, clear thinking and a participatory approach can do wonders for you. The leadership approach for which Henry Ford is known today can be classified as participatory leadership approach. He was one of those people who believed firmly in participation rather than centralization of power. His thinking in this direction helped him in coming up with the line assembly model. The first wonder of Henry Ford was to produce an affordable car. He is considered as an industry leader in the car manufacturing niche. He was the owner and founder of Ford Motor company, and till this day he is considered to be the most revolutionary and successful leader in the car manufacturing industry. He was not only a genius when it comes to thinking of the ways to produce cost effective cars, he was a perfect human resource mobilizer as well. In the times when industry was suffering from great economic depression, he managed to come up with increased wages policy of labor and still mange to scrape a lot of profit. This was all due to his participatory leadership approach. Ford’s approach towards leading was to lead from the front. Yet he was fond of participatory approach. As for the niche n which he was better than many, he introduced the concept of line assembly of cars. The concept itself is a proof that he believed in the perfectly finished product with the combined effort of all who are involved. This was his style of leadership. So in general we can say that his approach towards leadership was participatory in nature. Also, he was a firm believer of the fact that if you have some reward for those who perform better than the others, you will keep your workers motivated. This was the reason that his leadership was successful. His labor laws were just wonderful. (Kraft, 43) As a leader, one of the most important rule and policy for which Henry Ford is known was his labor laws. He was one of the very strong believers of welfare capitalism. He was one of those very few industrialist leaders of his times who believed in improving the conditions of his workers to get loyalty from them in return. At that time after the World War I employee turnover was great and the great depression was eating up businesses. At that time Ford came up with his labor policy of increasing minimum wage of his staff and workers from $2.34 to $5. Also, he made another change which is significant to note here. He reduced the working hours per week for the laborers. In 1926, he reduced the work week to 40 hours per week with 8 hours a day for 5 days in a week. Although his fellow industrialists criticized him for this act, he was a gem of a leader. He achieved a turn over rate so low through these reforms that it became negligible. As a result the productivity improved and so did the profits. Ford was a very intelligent industrialist and also was a very keen and intelligent businessman and leader. He knew that to sell his product, people need to have money in their pockets. He was willing to take risks to ensure future success. Also, he was one of those people who believed in decentralization of power and trust in his workers. Another social change he brought in the labor laws for his workers was a social department in his organization. This department t worked for the betterment of the workers. This department tried to make sure that the workers spent their life in a good and positive manner. Gambling and drinking was not appreciated. Although this step was out of concern, it was criticized a lot and in the end Ford decided to back off and not to look into the personal affairs of his workers. Still, many benefitted from this activity. His concept of profit sharing with the workers was implemented and participation from the manufacturer’s side and work from the workers side produced good results for both parties. Ford was not very fond of labor unions. In those days there were many industrialists who thought that labor unions were enough protections for a common worker. But Henry Ford was not of that opinion. He thought that it created a lot of trouble for not only management but was also of no good to the common workers. In most cases the owners got their own representatives installed as union members and there was no betterment coming out of the whole arrangement. When Henry Ford put his foot down against these unions there was not a very pleasant reaction. There were many strikes and acts of violence, but he stood his place. As a popular leader of his niche of the industry, he had his own share of misunderstandings and propagandas. He was linked with “The International Jew” although he denied it later on. His public apology and denial brought his popularity back to him. (Ford, 45) Ford was fond of the concept of independence in economic terms. His plant at River Rouge was so great it became the largest industrial plant of the world. The plant was capable of producing steel even. Ford was a person who knew his niche inside out. He was interested using his leadership charisma to use his labor force in the optimum manner to produce excellent automobiles from scratch, and without any dependence on foreign trade. This was the reason of his success even in the days of economic depression. Henry Ford was a strong believer of improving his workers condition to achieve low turnover and a better performance guarantee. (Bryan, 35) He worked closely with his workers, believed in respecting his staff and workers for what they did, and was in favor of participatory leadership and development. He was so keen on betterment of his staff that he was able to come up with labor laws and a better minimum wage for his workers. The social department of his organization was meant for improvement in the daily lives of his workers. His ideology was a success and very soon Ford Company went global. (Wilkins, Mira, Hill, 64) His line assembly model and his T model of Car manufacturing were not less than wonders. His best part was that he was interested in mutual prosperity. (Batchelor, 20) He wanted the best for himself and for his workers. Although as a matter of fact Henry Ford was fond of participatory approach and all his labor laws and developmental plans for his workers were focused on this approach, he was not able to handle his social department properly. As a leader, Henry Ford was not able to justify this even to his own workers why he was bothered so much about their personal lives. This was a mistake which he admitted and later backed off from such plans. So, although being a great leader of his niche industry, he wasn’t able to judge the level to which his workers were involved with him and waned to be guided and questioned. In this regard he was not able to run his participatory approach policy smoothly. He was capable of producing really good results through his better wages less time schemes and by avoiding labor unions. After all this discussion I would recommend that it was kind of him to reconsider the wages and give his workers a better chance of making money through multiple social schemes, it wasn’t very idea lot have a social department working in the direction which it did. Also, he wasn’t able to handle the propagandas properly. Media is far stronger today and they dig facts out and present it to the whole world today. He must have learned to handle these issues properly, as he was saved through these scandals only through the fact that very little percentage of the world’s population was then directly influenced by what media had to say. References: 1. Batchelor, Ray. Henry Ford: Mass Production, Modernism and Design Manchester U. Press, 1994. 2. Bryan, Ford R. Beyond the Model T: The Other Ventures of Henry Ford Wayne State Press 1990. 3. Ford, Henry; with Crowther, Samuel, My Life and Work, Garden City, New York, USA: Garden City Publishing Company, Inc, 1922 4. Kraft, Barbara S. The Peace Ship: Henry Fords Pacifist Adventure in the First World War Macmillan, 1978 5. Wilkins, Mira and Frank Ernest Hill, American Business Abroad: Ford on Six Continents Wayne State University Press, 1964 Read More