Management Gurus: Alfred Sloan. Part 4.
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It was often difficult for Sloan to mix central control and competition. GM expected its managers to be company men (at that time it didn’t have women managers). Managers were all expected to wear dark suits and light shirts. Their offices on the fourteenth floor of the main General Motors building were all decorated in the same way. They were expected to have similar values and similar attitudes. This sometimes made it difficult for GM’s managers to have a discussion. Before Sloan took a decision, he always wanted to hear opinions from all parts of his huge company. But on one occasion a manager presented such an excellent plan at a meeting that everyone immediately agreed with it. This didn’t please Sloan at all. He switched off his hearing aid and looked round the room.
‘So, gentlemen,’ he said, ‘we’re all in complete agreement, are we?’
The managers at the meeting all smiled.
‘In that case,’ Sloan continued, ‘I suggest that we delay our decision on this plan. Let’s meet again when we’ve had a chance to think about it. Before we take any big decision, I expect at least some disagreement.’
Managers at General Motors had a good life. Of course, they worked very hard and they were always under lots of pressure. But they were always well paid. In fact, some of them even earned more than Sloan himself. He believed that ability should be rewarded.
But his attitude to GM’s workers was very different. GM workers earned good money when the company was producing lots of cars. But in the bad times, there was no job for them and they earned nothing at all. Their organization, the United Automobile Workers, often tried to discuss the workers’ conditions with the GM management, but Sloan refused to speak to them.
The early years of the 1930s were bad for the company, but they were even worse for the workers and their families. By the winter of 1936, they had had enough. As the company was preparing its new cars for 1937, the workers at the company’s main factory in the town of Flint stopped working and sat down. Their unemployed colleagues from outside joined them and sat down in the factory as well. Sloan and the GM managers were very angry and asked the local police for help. But the police were not interested and the ‘sit-down strike’ continued through Christmas and into the next year. By February, the company’s car production had fallen to almost zero, while GM’s competitors Ford and Chrysler were producing more and more cars to make the most of the opportunity. In the end, Sloan and his managers had to accept the situation and they agreed to start talks with the United Automobile Workers about conditions in their factories. It was one of the few times that Sloan lost a fight.
The lives of GM’s workers improved slightly after that, but things didn’t really change at General Motors until December 1941. That was when Japanese planes bombed US warships at Pearl Harbour in Hawaii and the USA entered the Second World War. For the next few years, GM had to forget about its normal business. Many of its workers and managers became soldiers, while its factories produced equipment for the US war machine.
When the war finished in 1946, Sloan had to prepare for a completely new age of US business. Every boss in the USA was thinking hard about his own business and his plans for it. But Sloan had other worries too. He was already looking a long way into the future. And when he looked into the future, he wasn’t worried about GM; he was worried about its great competitor, Ford.