Henry Ford, the Bootstrapper (Biz Book Friday!)

Hey hey hey, it’s Biz Book Friday! the tradition is coming back.

Oh, Henry.

Henry Ford was inarguably one of the best entrepreneurs the country (and possibly the world) has ever seen.

To wit, here’s Wikipedia’s stunning intro to Ford’s achievements:

• His introduction of the Model T automobile revolutionized transportation and American industry.
• As owner of the Ford Motor Company, he became one of the richest and best-known people in the world.
• Celebrated as both a technological genius and a folk hero, Ford was the creative force behind an industry of unprecedented size and wealth that in only a few decades permanently changed the economic and social character of the United States.
• He is credited with “Fordism”: mass production of inexpensive goods coupled with high wages for workers.
• Ford had a global vision, with consumerism as the key to peace.
• His intense commitment to systematically lowering costs resulted in many technical and business innovations, including a franchise system that put dealerships throughout most of North America and in major cities on six continents.
• Ford left most of his vast wealth to the Ford Foundation but arranged for his family to control the company permanently.

(He also had enormous personal flaws, but sadly that’s par for the course for people with outsized impact on the world.)

But what Wikipedia doesn’t mention — and many people don’t know — is this:

• Ford was the consummate bootstrapper
• His biography, My Life and Work, is one of the best books on business *ever written

If you know me, you know I love reading old books. There’s nothing quite like viewing the past first-hand, through the lens of the people living in it at the time — people who wrote about their present. When reading new stories about the past, it’s so easy to slip into the habit of judging those ridiculously foresighted people from history, and how could they have ever believed that anyway? Like, duh. Which is kryptonite to learning, because of course, our present will soon be the past, and people will think the same of us. Perspective, and humility, are necessary ingredients to becoming fully human and these days they are in short supply.

Umm, yeah. Old book rant over.

Sooooo… I’d been meaning to read Henry Ford’s autobiography for some time.

If I’d known what an amazing, revelatory page-turner it’d be, though, I wouldn’t have wasted a second more delay.

Banishing the Pleasant Things in Life

Here are a sample of some of my highlighted passages from just the first few chapters:

I think that we have already done too much toward banishing the pleasant things from life by thinking that there is some opposition between living and providing the means of living. We waste so much time and energy that we have little left over in which to enjoy ourselves.

1922 to 2012: 90 years of Americans worshipping overwork. Has it ever been any worse than today?

The Whole Point

Power and machinery, money and goods, are useful only as they set us free to live.

Yes!

Skepticism

I have no quarrel with the general attitude of scoffing at new ideas. It is better to be skeptical of all new ideas and to insist upon being shown rather than to rush around in a continuous brainstorm after every new idea. Skepticism, if by that we mean cautiousness, is the balance wheel of civilization.

Rush around in a continuous brainstorm! The balance wheel of civilization!!

I ask you: what’s not to love about this down home, hard-as-nails pragmatism from a bazillionaire?

Signifying Nothing

We have passed through a period of fireworks of every description, and the making of a great many idealistic maps of progress. We did not get anywhere. It was a convention, not a march. Lovely things were said, but when we got home we found the furnace out.

Here he’s talking about radicals & reactionaries who want to either breakdown the capitalist system completely or freeze it in time, forever, to prevent any possible change whatsoever.

But if you ask me, this sounds a lot like any time we get together with our pals and talk about the amazing startups we’re going to build: Lovely things are said, but when we get home we find the furnace out.

Oooh, burn.

Or not burning, as the case may be.

Who Has Value?

The foundations of society are the men and means to grow things, to make things, and to carry things… Speculation in things already produced — that is not business. It is just more or less respectable graft.

Speculation? More or less respectable graft?

That doesn’t sound like the VC model at all. Not. at. all.

Shame on you for even thinking it.

Business: Like a Chicken

Profiteering is bad for business. The lack of necessity to hustle is bad for business. Business is never as healthy as when, like a chicken, it must do a certain amount of scratching for what it gets.

I want to favorite this so hard, scream it from the rooftops, tattoo it on my left ass cheek. (But not even my ass isn’t big enough for this paragraph. C’est la vie.)

This is one of the biggest reasons I — and, it seems, Ford — believe in self-funding through customer sales. Solve a problem, serve a need, get your just desserts.

Because:

The producer depends for his prosperity upon serving the people. He may get by for a while serving himself, but if he does, it will be purely accidental, and when the people wake up to the fact that they are not being served, the end of that producer is in sight.

And if that producer is divorced from having to please customers, insulated from having to create value and capture that value in the form of customer dollars — able to avoid selling entirely, in fact — you have a venture-backed startup.

Maybe I’m bull-whipping, dog-piling, and fireballing a dead horse here. But if you ask me, this is the heart of the matter.

Anything that gives you the ability to avoid the reality of serving your customers is bad for you and everyone else. If you succeed, then, it will be accidental.

Technofetishism

Rushing into manufacturing without being certain of the product is the unrecognized cause of many business failures. People seem to think that the big thing is the factory or the store or the financial backing or the management. The big thing is the product, and any hurry in getting into fabrication before designs are completed is just so much waste time.

OMG.

Can you believe this book was written nearly 100 years ago?

Henry Ford: Startup Oracle.

The Cutting Edge.

The principal part of a chisel is the cutting edge. If there is a single principle on which our business rests it is that. It makes no difference how finely made a chisel is or what splendid steel it has in it or how well it is forged—if it has no cutting edge it is not a chisel. It is just a piece of metal.

Business, like a chisel, has a distinct purpose.

Peter Drucker famously wrote that “The purpose of a business is to create and keep a customer.”

Henry Ford would say that “The purpose of a business is to serve.” He was a big believer in Service with a capital S — not customer service, but to serve the world, both customers and employees, by excellent products and an excellent working environment, fair wages, and an opportunity to better one’s self.

But if you read TechCrunch, HN, Business Insider, the Wall Street Journal, or the Economist — from anywhere on the low-to-stratospherically-quirked-highbrow spectrum — how often do you find this mentioned? The purpose?

Just this side of never.

It’s all about the handle, the splendid steel, the fine craftsmanship. Never the cutting edge.

Henry Ford: Best Bootstrapper of All Time.

Conclusion… and Next Week!

Now, Henry and I disagree on several points — namely the goal of constant price reduction — but that’s a topic for another Biz Book Friday.

Suffice to say, regarding the autobiography of this prescient business genius:

A++++ Would Read Again.

Bonus: you can get it for your Kindle or iBooks for free, because it’s out of copyright (that’s how old it is!). Download Henry Ford: My Life and Work now, and read the crap out of it.

Seeya next week!

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This entry was posted on Friday, June 1st, 2012 at 2:11 pm and is filed under Biz Book Friday, Hard Work. You can follow any comments to this entry through the RSS 2.0 feed. You can skip to the end and leave a comment. Pinging is currently not allowed.