We’re marketers. We’re full of ideas. We constantly look at how we present our products, how we distinguish our craft and how we price our output. It’s the nature of reinvention. It’s nothing new. Whilst we have access to platforms to test our ideas, 100 years ago, few had the conviction and belief in their ideas to the extent that Henry Ford did.
In 1908, Ford’s factory space measured 2.65 acres. By 1911, the space had increased to 32 acres. The number of his employees had risen from less than 2000 to 4000 in the same space of time. Car output had risen from 6,000 to 35,000.
5 years earlier, Fords factory space was just .28 acres. That’s phenomenal growth. What shaped it?
Developing upon an idea
Henry Ford wanted to deliver a car to the masses. That was his big idea. He had already designed 8 models before the Model T. When the Model T was launched in 1908 it transformed the market. It broke all thought, price and production convention within the motor industry.
Henry Ford believed the ‘universal car’ should have 6 key attributes:
- Quality of material
- Simplicity of operation
- Power in sufficient quantity
- Absolute reliability
- Lightness
- Control
It was the simplicity of design that appealed to Henry Ford. ‘The less complex an article, the easier it is to make, the cheaper it may be sold, and therefore the greater number may be sold’. Less than a year into production, Ford decided to build only one model of car – and that was the Model T.
He ignored the concerns of his salesmen. They wanted to see the line increased. They believed that sales would increase if Ford offered more models. Henry Ford responded that they were listening to the 5%. The special customers who could ‘say what they wanted’. He was more interested in the 95% that bought without ‘making any fuss’.
Ford’s idea
‘I will build a motor car for the great multitude. It will be large enough for the family but small enough for the individual to run and care for. It will be constructed of the best materials, by the best men to be hired, after the simplest designs that modern engineering can devise. But it will be so low in price that no man making a good salary will be unable to own one – and enjoy with his family the blessing of hours of pleasure in God’s great open spaces.’
His critics responded that cars were only for the wealthy. A good car could not be built at a low price. Ford begged to differ.
Breaking the pricing convention
In Henry Ford’s autobiography he tells the story of a old man, in a dark little shop, labouring for years to craft axe handles out of seasoned hickory. The meticulous nature of the craft led to the production of 8 handles a week. He received $1.50 for each.
Ford noted the ‘modern methods’ of 1908 that allowed factories to create better handles at a fraction of the cost. All alike and all perfect. Fords view was that he was simply ‘developing an idea’.
When the Model-T was first launched it was priced at £850. Four years later it was reduced to £575. Four years further on the car owned 48% of the automobile market. Ford stuck to his promise to create a car that could be enjoyed by the masses.
Breaking the production convention
The Ford Model-T was developed using two core materials. Whilst attending a motor race in 1905, Ford scoured the wreck of a French car. He knew that foreign cars were made from smaller and better parts. He picked up a valve strip stem from the wreckage and asked his assistant to ‘find out about this’. His persistence eventually pointed to the inclusion of vanadium within the steel. Subsequent production using vanadium steel allowed Ford to significantly reduce the weight of the car whilst retaining its strength.
The second material was wood. It was used to build the wheels as well as the interior of the car. Ford put in place a range of practices to help reduce wood waste during production. A man focused upon such efficiencies wouldn’t let wood lie, unprofitably, on his factory floor. In the 1920’s he found a use for the scrap wood. Charcoal. Originally know as Ford Charcoal, the business eventually became Kingsford Charcoal. Today, Kingsford’s charcoal output accounts for 80% of the entire charcoal market in the US.
The rest, as they say, is history.
A lesson learned…
I’ve just finished reading Henry Fords autobiography for the first time since high school. His ideals and beliefs still ring true in 2014. ‘Ideas are of themselves extraordinarily valuable, but an idea is just an idea. Almost anyone can think up an idea. The thing that counts is developing it into a practical product’
Ford stuck to his principles, his idea of creating an automobile for all. His attention was consistent. His belief was consistent. Though we live in a culture where where the internet is the driving force behind individuality, there’s an awful lot we can learn from the man that fathered mass production.
Is your big idea about what you can create, or for whom it will be utilised?
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