Sloan was a young MIT-educated engineer who in 1898 at the
tender age of 23 seized a risky opportunity to take over a failing company that
made bearings used in machinery. He and
a partner slowly built it up through hard work, attention to cost-effective
manufacturing, technological advancement, and responsiveness to customers. Eventually in 1916 he sold the company to the
fledgling General Motors, which then was a holding company of a hodge-podge of
automobile manufacturers and related parts producers patched together by
wheeler-dealer Billy Durant. At that
point Sloan took the second big risk in his life, trading his large stake in
his company for mostly stock in General Motors, whose future, especially given
Durant’s inattention to sound business administration, was uncertain. Sloan survived many trying times as a senior executive
under Durant’s erratic leadership, given that almost all of his net worth was
tied up in the company stock. But Sloan’s
high risk, high reward gamble paid off in time.
By the early 1920s Durant was deep in a financial crisis, and eventually
Sloan emerged as the chief executive. He
righted the ship by further developing the management techniques which had made
him a successful businessman, methods that became the foundation of modern business
management.
Although there are some dry parts when Sloan gets to
discussing organizational structure and finances, most of the book is a very
engaging read for someone with a general interest in the history of the American
automobile industry. The narrative
covers a wealth of topics from the early days of the automobile,
including: Durant’s wheeling and dealing
from his original base in Buick to buy the group of automobile companies that
would become GM; the engineering and manufacturing issues presented by resident
engineering genius Charles Kettering’s attempt to develop a competitive
air-cooled engine; the success of GM’s consumer-focused business model – “a car
for every purse and purpose” – against Ford’s failed “any color as long as it’s
black” approach; the development of leaded-gasoline and high-compression
engines; GM’s groundbreaking role in the development of the diesel-electric
motors that would supplant steam power in railroad locomotives; the company’s
struggles to survive the Depression; the challenges of shifting to production
of military vehicles and war materiel during the Second World War; and the styling
revolution led by the legendary Harley Earl.
My Years with General
Motors seems to be regarded as one of the seminal books on business
management. In an introduction, business
administration guru Peter Drucker calls it “a must read.” The cover of my paperback edition quotes Bill Gates saying that Sloan’s book “is probably the best book to read if you want
to read only one book about business.” I
certainly cannot gainsay this sentiment.
But I read the book mostly for its narrative history and stories of
engineering challenges encountered and solved.
Sloan’s book is a great read even for non-MBA types interested in how
the great vehicles of today came to pass.
R Balsamo
