167
See also: Stand out in the market 28–31 ■ Gaining an edge 32–39 ■
Balancing long- versus short-termism 190–91 ■ The value chain 216–17
Henry Ford
Henry Ford was born in
Michigan, US, in 1863. He was
always fascinated by
machines, and as a child built
rudimentary steam engines.
He left school at 15 to work on
his father’s farm, but in 1879
he moved to Detroit to work as
an apprentice at the Michigan
Car Company, which made
railroad cars. He moved home
for a while, and did several
engineering jobs, before
returning to Detroit to work as
an engineer for the Edison
Illuminating Company.
At the same time, Ford
began to make a gasoline-
driven car, Thin Lizzie, in his
garden shed. He persuaded a
group of businessmen to back
him, but a lack of experience
led to business failure—twice.
His third business—the Ford
Motor Company—was formed
in 1903. Its first car, the Model
A, was followed by several
other models until the
company struck gold with the
Model T: “a motorcar for the
multitude.” By 1925 Ford was
producing 10,000 cars every 24
hours, producing 60 percent of
the US’s total output of cars.
His last great innovation—at
the age of 69—was the V8
engine. He died in 1947.continued to dominate the market.
The knowledge he had gained
enabled him to improve his water-
powered spinning frame.
Moving ahead
Henry Ford did not invent the
automobile, but he did develop the
first affordable car for middle-class
Americans at the beginning of the
20th century. Most people had never
aspired to owning a car because
they were seen as a luxury item for
the wealthy, and, as Ford said at
the time, most people would have
been happier with “a faster horse.”
Ford, like Arkwright, succeeded
because of a technical edge. His
idea was that of mass production,
using a moving assembly line to
reduce production costs. By 1918,
Ford Motor Company was the clear
leader in the US automobile market
—the Model T made up half of all
cars in the US. Ford continued to
lead the market until the mid-1930s.
Moving ahead of others in a
market involves risk. By taking the
initiative—with an innovative
product, new technology, lower
prices, better distribution,
promotional offers, or forceful
advertising campaigns—a company
creates an opportunity to seize the
leadership position. Organizations
may seek such an advantage
because their strategy and
approach is always to lead into ❯❯WORKING WITH A VISION
Consumers do not
innovate—they are happy
with a better version of
an existing product.Even if competition
arrives, consumers
continue to associate
the first company with
the concept.The company gains
the competitive
advantage of being
first to market.When a company
introduces a totally new
concept, it creates a new
market and is “first” in
consumers’ minds.A company that leads the way
can dominate the market.