Recasting the Machine Age: Henry Ford's Village Industries

Introduction: Henry Ford, Centralization, and Decentralization

1 Introduction Henry Ford, Centralization, and Decentralization “ Te c h n o l o g y S p u r s D e c e n t r a l i z a t i o n a c r o s s t h e Country.” So read a 1984 New York Times article on real estate trends in the United States.1 Then in its early stage, the contemporary revolution in information processing and transmittal today allows large businesses and other institutions to disperse their offices and other facilities across the country and across the world without loss of the policy- and decision-making abilities that formerly required regular physical proximity. Thanks to computers , word processors, faxes, the Internet, and the World Wide Web, decentralization has become a fact of life in the United States and other highly technological societies. Decentralization through technology is not, however, as recent a phenomenon as that 1984 Times article might suggest. In various forms, it is at least as old as the American Industrial Revolution itself—this despite the common association of assembly lines and mass production with centralization. The Jeffersonian ideal of decentralized production through small rural manufacture , as a means of preserving agrarian values while encouraging domestic industries, is an early example of this orientation.2 Indeed, such an ideal was common to the early stages of the English as well as the American Industrial Revolution and in both countries often coexisted with the later centralized stages. Significantly, as the business historian Alfred Chandler has repeatedly demonstrated, many of the most successful of the large American corporations that emerged in the late nineteenth and early twentieth centuries—not least, General Motors under Alfred Sloan—combined centralized policyand decision making in one headquarters unit with decentralized divisions 2 i n t r o d u c t i o n for the financing, manufacturing, and marketing of their various products.3 In turn arose the branch assembly and production plants common to those corporations. This was the “visible hand” of corporate management revolutionizing American business and industry.4 Decentralization as such was nevertheless limited in scope. Not only did policies and decisions continue to be made in a central headquarters building —thanks in part to the absence of information-processing equipment and techniques—but the branch plants themselves were often quite large in size and quite centralized administratively. Moreover, the ideal for most of the major industries was, despite those branch plants, putting entirely under one roof all the processes needed to transform raw materials into finished products . This aim reflected a common strategy of vertical integration, of seeking to control most if not all the stages of manufacturing and marketing of products (as well as, of course, the more traditional strategy of horizontal integration , of seeking an ever larger market share of products and thus reducing competition).5 Nowhere were this ideal and this strategy realized more fully—and more literally—than in the Ford Motor Company: first in the Highland Park and then especially in the River Rouge complexes created by Henry Ford (1863– 1947) and his associates in the 1910s and 1920s. Both became symbols of America’s industrial might and technological prowess in the first half of the twentieth century.6 As a self-described “experienced observer of industrial undertakings,” journalist John Van Deventer, wrote in 1922 about the growing Rouge plant, “Each unit [is] . . . a carefully designed gear which meshes with other gears and operates in synchronism with them, the whole forming one huge, perfectly timed, smoothly operating industrial machine of almost unbelievable efficiency.”7 In the Rouge plant, raw materials such as coal, iron, limestone, timber, and silica—most of them derived from Ford-owned mines, quarries, plantations, and forests—were funneled by Ford-owned ships and trains into facilities—including a huge steel mill and the world’s largest foundry—from which emerged finished automobiles. The result was one unceasing, moving process of gigantic dimensions. This was a fully centralized manufacturing and assembly process, as opposed to the only partially decentralized administrative process in Ford Motor Company and General Motors alike. (To be sure, however, even when the Rouge plant was at its peak in the 1930s, the company still relied on some 6,000 independent businesses for parts and materials.)8 Both Ford plants embodied the mechanical genius and administrative Henry Ford, Centralization, and Decentralization 3 talents...