Ford T
Case Studies
The Model T Ford
Henry Ford did not invent the motor car – in fact he was a comparative latecomer to the scene. Although he had started producing cars back in 1903 he had little success until the Model T. The first production Model T was built on September 27th, 1908 in Detroit and production continued until 1927. The key contribution which he made was to change the approach to manufacture and marketing of cars. Prior to his activities cars had been a specialised luxury product available only to the wealthy; his vision of producing ‘a car for Everyman’ and at a price which Everyman could afford resulted in a revolution in the marketplace. Importantly the ways in which the vision was realised extend beyond cars to thinking about a whole range of consumer products and even services; again Ford did not invent ‘mass production’ but his efforts around the Model T ushered in the era in which this mode of thinking predominated. It’s possible to think of innovation taking place along several different dimensions – the ‘four Ps’ of ‘product’, ‘process’, ‘position’ and ‘paradigm’. (See chapter 1 of ‘Managing innovation’ for more detail on this). In the case of the Model T Henry Ford and his team moved the frontiers of all four at the same time – and in doing so created a completely new system for thinking about manufacturing. Product innovation – involved rethinking the design of the car. Earlier car manufacturing had been like bespoke tailoring, hand building a car to suit the wishes of a particular client, offering extensive variety and choice around a basic engine and chassis. Ford’s contribution here was to work to a target cost – aiming to bring the Model T within the purchasing power of a large market by designing and standardising – essentially applying what we would now call ‘value engineering’ approaches – not only the whole car but the constituent elements within it. Position innovation – involved rethinking the target market for the product.
The Model T Ford
Henry Ford did not invent the motor car – in fact he was a comparative latecomer to the scene. Although he had started producing cars back in 1903 he had little success until the Model T. The first production Model T was built on September 27th, 1908 in Detroit and production continued until 1927. The key contribution which he made was to change the approach to manufacture and marketing of cars. Prior to his activities cars had been a specialised luxury product available only to the wealthy; his vision of producing ‘a car for Everyman’ and at a price which Everyman could afford resulted in a revolution in the marketplace. Importantly the ways in which the vision was realised extend beyond cars to thinking about a whole range of consumer products and even services; again Ford did not invent ‘mass production’ but his efforts around the Model T ushered in the era in which this mode of thinking predominated. It’s possible to think of innovation taking place along several different dimensions – the ‘four Ps’ of ‘product’, ‘process’, ‘position’ and ‘paradigm’. (See chapter 1 of ‘Managing innovation’ for more detail on this). In the case of the Model T Henry Ford and his team moved the frontiers of all four at the same time – and in doing so created a completely new system for thinking about manufacturing. Product innovation – involved rethinking the design of the car. Earlier car manufacturing had been like bespoke tailoring, hand building a car to suit the wishes of a particular client, offering extensive variety and choice around a basic engine and chassis. Ford’s contribution here was to work to a target cost – aiming to bring the Model T within the purchasing power of a large market by designing and standardising – essentially applying what we would now call ‘value engineering’ approaches – not only the whole car but the constituent elements within it. Position innovation – involved rethinking the target market for the product.