Did buggy-whip makers fail to read the handwriting on the stable wall?
In Sunday's New York Times, Randall Stross debunks the parable told round the world by the late Professor Theodore Levitt's best-selling Harvard Business Review paper "Marketing Myopia," now celebrating its fiftieth anniversary. Drawing on the historian of technology Thomas A. Kinney, he observes that we should learn instead from the carriage industry's suppliers, like the bearing manufacturer Timken, which flourished in the transition because they had essential metallurgical skills. (GM's Alfred P. Sloan originally ran a bearing company, too.)
So far, so good. But then, while acknowledging Studebaker as a major exception, Mr.Stross writes that unlike the buggy whip makers, who did not have an automotive analog,
[t]he carriage makers did, and they tried their best to remake themselves into automakers. But they were expert woodworkers without expertise in precision metalworking, Mr. Kinney said: "Bicycle manufacturers were actually better suited for auto manufacturing than were carriage makers."
That's true, especially globally (think of Peugeot and Škoda), but in the United States, what's more impressive is how much if the carriage industry did rise to the challenge. The Flint Wagon Works bought Detroit's Buick Motor Company in 1903 and re-established it in Flint, hiring the head of another local carriage maker, the charismatic and impulsive William C. Durant of Durant-Dort, to run it. Durant acquired other car firms, including Oldsmobile and Cadillac, creating General Motors. Sadly, the bold entrepreneur's ventures never recovered from the Depression, and the modern GM was created by the master manager Sloan. The carriage makers didn't have advanced machining skills, but they could buy companies and hire individuals that did.
As James M. Miller writes in the Flint Journal:
The Flint Wagon Works brought Buick to Flint, and it and the Durant-Dort Carriage Co. served as the "training school" for many of the men - William C. Durant, A.B.C. Hardy, Charles Nash, James H. Whiting and others - who would later build and run Buick, Chevrolet and other companies
"These guys were starting an industry that was going to destroy another one, and making it a smooth transition," said Dallas Dort, president of EKG Research in Flint.
His grandfather was J. Dallas Dort, partner with Durant in the carriage company that bore their names.
Perhaps the real point is that even when you think you've learned all the lessons and are doing everything right, disaster is still ubiquitous. After all, most of the fledgling auto companies went under not that long after the carriage makers did. Durant's colleague, the former race car driver Louis Chevrolet lost control of his namesake company and, like Durant, received a GM pension from Sloan. In turn, the success of the arch-technocrat Sloan in dominating the automotive market ultimately helped calcify GM's bureaucracy, recently bringing the company close to Durant's fate.
Neither Mr. Stross nor his sources propose an alternative master parable of corporate change, so I suspect the buggy whip will be with us for a while. Fortunately, the picture for the carriage industry's architectural heritage isn't entirely gloomy. Last year the House and Garden section of the Times reported on the homesteading of Flint's Carriage Town -- and the ongoing renovation of the Durant Hotel. If success is never final, neither is failure usually total.
(Photo credit: Derek Jensen, via Wikimedia Commons.)