Henry Ford on Innovation

There’s little doubt that Henry Ford was one of the great industrialists and innovators of the 20th century, and I would image he’d be rolling in his grave if he could see what has become of his once-illustrious company. While the staggering powerhouses of Detroit have few examples of stellar management these days, the man who put the Ford name on the map has a surprisingly poignant sentiment that we seem to have forgotten in the 21st century:

If I’d asked people what they wanted, they would have asked for a better horse.

In IT especially, we are obsessed with analyzing the past in the hopes of predicting the future. Rarely does a day go by where I don’t receive a swarm of surveys in my email and postal mailboxes, asking for my opinion on everything from cars, to soap to enterprise technology systems. We’ve made a science out of mining people’s opinion, and to Mr. Ford’s consternation, that is not where we need to look for innovation.

Few revolutionary ideas come from a chorus of the masses begging for some company to come along and implement the idea. In Henry Ford’s time, the benefits and technology of the automobile were virtually unknown to the mass market. If Mr. Ford acted like a modern company and barraged his customers with surveys and focus groups, his analysis would likely conclude that his efforts would indeed best be focused on building a better horse. Intimately familiar with the fact that the past and the market could not understand the automobile’s benefits or his methods for producing them, he threw market research and opinion out the window, freeing himself from the shackles of the past in order to create the industry of the future that would revolutionize transportation as we know it.

While few of us will have the opportunity to create an entirely new industry and change the course of human history, we can take a lesson from Ford’s recognition that the past and public opinion are not the right tools to foster innovation. Consider how your business would be different if you threw out the rule book and did not tolerate “it’s always been done this way” or “this is what our customers want” as valid reasons to continue doing business a certain way. When the market and your peers are asking for a better horse, take a moment to consider if there’s an opportunity to give them an automobile instead.

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Comments

  1. Hi Pat,

    I would argue that consistent innovation – innovation that is valued by customer – lies at the intersection of three disciplines:

    (1) Strong operations.
    (2) A passion for excellence in the company’s areas of expertise (technical, design, scientific, etc.) and
    (3) A deep interest in and understanding of the target markets.

    Companies that overemphasize on any one of these areas to the neglect of the others generally produce the one-hit-wonders.

    – A company may have strong operations, but lack a clearly defined direction. So they are good at what they do today, but one day the momentum will subside.

    – A company may be passionate about their technical expertise, but lack a real interest in and understanding of the market.

    – A company that emphasizes a deep understanding of the market will allow the market to define its innovative efforts – but miss out on the “automobile because the market asked for a better horse.”

    It’s about balance. I usually plot these in a Venn diagram, with the Venn sitting on a foundation of “Effective management” – the discipline that ensures all other disciplines.

    As you probably know, Henry Ford was in fact a terrible manager. His initial success was driven by his technical expertise and passion for what he was doing. However with time, this momentum could no longer carry him and, lacking a balance between these three areas he nearly drove Ford into the ground. (“They can have it in any color they want, as long as it is black.” – Henry Ford, paraphrased) It was his grandson who took over and saved the company… for a while.

    It sounds like Nike, described in your post “The Genius of Dumb Devices” is doing a good, balanced job.

    Best regards,
    Dov Gordon
    http://www.DovGordon.net

  2. Hi Dov,

    Thanks for the insightful comment. People that can cover the three areas you mention seem to be a rare breed in the executive world. For true innovation to take root, I think you need four types of people, each encouraged and compensated accordingly:

    Innovators – The “big idea” people

    Assessors – They can vet the innovation and determine if its a) valuable b) cost-effective c) the right idea at the right time

    Implementers – Take the innovation from idea to new way of doing business

    Operators – Run the show once the innovation has become “business as usual.”

    As you allude to, many companies are missing one of more of these elements at their own peril.

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