John Davirose Rockefeller and his philanthropy

After reading JDR's autobiography, I am surprised to find how big an entrepreneur and how great a philanthropist he is. At age of 25 he had set up Standard Oil and by age 54 he was a great philanthropist.

The directed philanthropy that he started was instrumental in removing poverty from some parts of Africa and smallpox from the face of earth.

Toyota 14 Principles ..

The Toyota Way (Toyota Production System) is a comprehensive expression of the company's management philosophy, which is based on the two foundational principles of Continuous Improvement (kaizen) and Respect for People.

The Toyota Way defines the fundamental values and business methods all Toyota people should apply in every aspect of their day-to-day work, at every level of the company, worldwide. 

Click here to read an interesting blog

The Toyota Way is supported by two main pillars: 'Continuous Improvement' and 'Respect for People'. Toyota is never satisfied with where they are and always work to improve their business by putting forward new ideas and working to the best of their abilities.

We are living in a world of great competition. Even though the Japanese or Toyota were not the first to invent the automobile, the brain came from Europe, the Japanese have shown the world how good they are at execution, discipline, standardised orderly, neat approach, continuously striving to improve the product or process through  continuous improvement or Kaizen. 

They have been able to show the world how excess of inventory in any organisation or industry can be dangerous, costly or even fatal and why manufacturing just in time when the customer needs the item is the best and cheapest high quality way to get reliable good products out of the system for the customer.

The implementation of Toyota Way saw to it that any employee could work to improve the company . TPS reduces waste, increasing efficiency and reducing costs

Ford and lean manufacturing, Open Forum ..

I had the good opportunity to present a session in the Open Forum from Alliance School of Business, on 7 October, organised by the Operations stream on the topic Henry Ford, Mass Manufacturing and Lean Manufacturing. It was attended by 5 faculty from the Operations stream. 

Presenting before a faculty group is always beneficial as the presenter has to go to a higher professional level than what is delivered to the students. Also the preparation time for the talk was almost the whole holidays of Dussehra. I was also simultaneously reading Homer's Iliad, as that was the topic originally planned for a future week.

Without doubt we can say that Ford was in a major part one of the greatest industrialists the world has ever had. 

• Industry 1.0 focused on Mechanisation, cotton loom, printing press, steam engine etc.
  
• Industry 2.0 focused on  invention of electricity and mass manufacturing. 
• Industry 3.0 focused on the Digital Revolution sparked by the invention of the microprocessors and digital computer starting with the cutting edge work from Claude Shannon of MIT. 

We are now at the threshold of Industry 4.0 which is going to be the one of Artificial Intelligence, Machine Learning, Internet of Things, Blockchains, 3D Printing etc.

Yesterday's talk was specifically on the contribution of Henry Ford to Industry 2.0 or Mass Manufacturing.

Ford introduced Model T car for the world in 1908. It was initially offered at $850 and by 1925, it was offered at $260. Henry Ford's three pronged focus was on 

1. cost reduction (affordability), 
2. simple to operate (simplicity) and 
3. working for a long time (durability).

Ford is said to have been asked repeatedly why Model T came only in black colour, it was because black colour was cheap, dried faster and it was possible to make a car in just 90 minutes with the black paint.
Ford hated waste. He wanted lot of value addition and focused all his efforts on it. He created the concept of mass mobility, revolutionised mass production, helped create the American middle class and helped Americans to move from the cities to the towns, started the suburban sprawl. 

On first December 1913 was the day Henry Ford installed the first moving assembly line for the mass production of an entire automobile. His innovation reduced the time it took to build a car from more than 12 hours to one hour and 33 minutes

It kick started the MASS PRODUCTION REVOLUTION WORLD OVER.

The use of the moving assembly line allowed for the work to be taken to workers rather than the worker moving to and around the vehicle.

Ford also shocked the world by doubling workers pay to $5 per day. He wanted to give respect to the working class, and was sure this act would help him retain the best skilled workers in Ford.

Going through his autobiography, we understand he was more happy giving dividends to the working shareholder than the non-working shareholder.

Doubling the average wage helped

• ensure a stable workforce (no quitting) and
• boosted sales (the workers could now afford to buy the cars they were making)
• laid the foundation for an economy driven by consumer demand.

Ford for the first time brought these LEAN concepts to the world.

• Flow: started with raw materials and ended when the customer left with his car.
• Standardisation: standardization of product models, associated parts and also production tasks
• Reduction of wastes: in particular operator movements by minimizing the number of tasks to be performed
• Just in time: Ford worked on its Supply Chain to get the right amount of materials and parts according to demand

(all these lean concepts were developed 12 years before Sakichi Toyoda proposed looms stopping when fibre got cut (autonomation) for looms)

Why then did Ford fail ?

Ford did not focus on organisational improvement, solely on product quality. Product was more important than the organisation. Family run organisations after two generations need to be transferred to professionals to manage, as complacency sets in the family and it is difficult after two generations to find grandchildren with the same fire in the belly as their grandfather. 

Of 100 businesses that are started, it is found from a Harvard study that only 40 enter the second generation and of the first 100, only three enter the third generation. Click here to read my blog on this phenomenon. It was the reason why the 160 year old Tata Sons from India had to slowly move to professionals to run the organisation as smart leaders were not coming from the family.

Though Model T started at $850 around 1912, through mass manufacturing he brought it down to $260 in 1925, making it the car of the masses by reducing waste, ie. inventory pileup . Ford ruled the world of automobiles the first 40 years till 1940 when we find General Motors under a great leader Alfred P Sloan overtook Ford. MIT named its business school after this doyen of the manufacturing world. Japanese entered the market with low quality products, but kept continuously improving their products, conquering global markets.

The discipline, practical application dedication saw the company Toyota, born in 1939, 36 years after Ford in 1903, take over the world automobile scene presently.

The 2021 automobile sales global is given below. (statista.com)

1. Toyota            9.56 m
2. VW                 8.88 m
3. Hyundai-Kia` 6.67 m
4. GM                 6.29 m
5. Stellantis       6.14 m
6. Honda            4.46 m
7. Nissan           4.06 m
8. Ford              3.94 m
9. Renault         2.69 m
10. BMW             2.52 m

Top 10 sales 55.21 million vehicles and global sales are 66.7 million vehicles.

For a company that ruled the automobile world for the first fifty years of the last century, in the face of increased competition and better manufacturing methods, can it or will it revive and survive in global market ?

George.

Homer's Iliad - story of war, heroism, valour and deceit ..

During this time of Dussehra holidays, I thought of making good use of the time. I am reading Iliad by Homer (lived in the 8th century BC) written and published around 750 BC on the Trojan war fought between Greeks and Trojans from Troy (modern day Northwest Turkey). Encyclopaedia Britannica claims Homer to be one of the all time greatest of the world's literary artists and Iliad, his first work to be one of the earliest literary works.

 

Throughout the book we see mention of the names of different Greek Gods, mainly Apollo as Gods did rule the lives of the people. King David of the Bible Old Testament would be born only 200 years after the Trojan war was over, around 1000 BC. Appeasement of the native ancient Gods through offerings and sacrifices was very much prevalent then, as we now also see. The full compilation of the Old Testament in the Bible was not ready, it had to wait till 600 BC.

 

Believers of the Old Testament Gods of Jehovah in Jewish belief have moved to the more convincing Triune God for Christians as a matter of conviction and convenience. One should remember that this shift happened as the old Gods were getting ineffective and their teachings were inadequate, feeble and weak.

 

Who knows whether in the coming years we too will not switch over to more powerful Gods, created from our imagination, more suited to the modern times, digital avatars in the digital and artificial intelligence domains ?

 

The main story line is the conflict between the Greeks – led by Agamemnon, King of Mycenae – and the Trojans – whose king was Priam – which took place in the Bronze Age around 1200 BC, and lasted 10 years.  The epic Iliad is about the tenth year of this ten-year war between Greece and Troy. It is a description of the events that took place during the tenth year of the war and told by the protagonist of the poem, Achilles, one of the most celebrated Greek warriors in the war. The other book by Homer, Ulysses is about the tale of the victor Odysseus making his way to his home country, Greece.

 

This singular book forms the basis and one of the most influential books of western literature. Written in poetic style in ancient Greek language and recited over the ages, the English translation has withstood the test of time and is as absorbing as the original one.

Gods, Kings and warriors united the people then while the people fought others who were following their own different Gods (as do the present day people). Wars described how nations (and people) were born, survived and went down under.

I am thoroughly and slowly enjoying each step of my trip to Troy, in the north west corner of Turkey, going back in time by 3200 years, to understand the minds, thoughts, beliefs and actions of people, their conversations, emotions and stories of heroism and valor during the time of the war. This helps us to gauge where the present day men are faltering in their steps, helping understand the weaknesses and limitations of the present day Gods. 

Achilles

Ancient Gods keep changing and increasing over time, man has not changed. Old Gods are forgotten, new Gods are invented and put in place. These Gods will be forgotten and new ones again invented in the future, in another five hundred to thousand years. The book is the defining one that paved the way to the birth of English literature. More reading will expose more facts to me in the coming days.

One of the events in the book mentions about the Trojan leader Chryses asking the Achean (Greek) leader Agamemnon to release his daughter Chrysues. The request is refused. The Trojan leader now requests God Apollo who brings in a plague to inflict the Acheans (Greeks). When Agamemnon realises the plague was due to the interference of God Apollo, he releases Chryseus.

Though I have not reached the end of the book, I understand, towards the end of the war the Greeks through an act of deception under the King of Ithaca, Odysseus, build a huge white wooden horse and leave it at the gate of Troy as an offering to the Gods. They pretend to give up the battle and sail away back to Greece. Sensing victory, the Trojans took the white horse inside the city of Troy, when the soldiers or warriors who were hiding inside the big wooden white horse came out and ransacked Troy, bringing the great ten year battle to an end.

Some comments need to be made about the age of this composition to know how important it is to world culture and specifically Western literature. The oldest Hindu epics (the oldest world religion) of Bhagavath Gita, Ramayana and Mahabharatha, as per Encyclopaedia Britannica were written around 500 - 300 BC, which qualifies Homer's work to be among the oldest in the western and eastern world. As per Columbia University sources, the Confucian Analects, the Confucian holy book, is believed to have been written after the death of Confucius in 479 BC and  between 476 and 221 BC. 

The Angams of Jainism were composed around the sixth century and written around the fourth and third century BC. The Tripitakas of Budhism were composed around 550 BC and written during first century BC. The other older religion Jewism, it's holy book Torah, which is the first five books of the Hebrew Bible, Genesis, Exodus, Leviticus, Numbers and Deuteronomy, as per Britannica was composed in sixth century BC and revisions done in the fifth century BC. Christianity and Islam are too nascent and young to find mention in this writing.

The distance between Greece and Troy is just about 380 km, which in modern day driving one can do in 6-8 hours driving or an hour of flying. It took 10 years for the victorious Greek forces under Ullyses to reach Greece from Troy after the war ..

Though the story line for the events in the book is almost 3200 years old and told about 2800 years ago, the narration is very real and lively. It is great to see that people three thousand years back also had the same feelings and emotions of fear, confidence, anxiety,  valour etc.. as any one of us. Homer's writings will continue to dominate and influence global thoughts and actions for a long time to come.

George 

Henry Ford and Toyota Production System ..

We all know Henry Ford was the doyen behind the introduction of affordable motor cars for the traveling public of the world in 1912 with the introduction of the Model T Ford motor car in the US. 

Going through Henry Ford's autobiography, My Life and Work, published in 1922, while talking of workplace organisation, hygiene, cleanliness, orderliness, vendor relationships, innovation etc, it gently reminds us that the original principles of efficient low cost production was proposed by Henry Ford around the 1920s itself. 

I get a feeling that the Toyota Production System principles were originally proposed by Henry Ford around 1920s. The only TPS/lean manufacturing thinking I find lacking then, is the unit type of production, acting against old batch production. The 1914 Harris EOQ model was ruling the world of Inventory management then.

Henry Ford in his autobiography also talks of costs as paid to vendors and prices paid by customers to buy Ford cars. According to Ford, the costs should be lowered and this will ensure that prices at which cars are offered to customers are also lower. If the vendor is not working at full efficiency, what ever products he offers to Ford will be at a higher price. The supplying vendor cannot lower it any further as he is already working at an inefficiency and is unaware of ways and means to lower it any further. This is a challenge for Ford as it cannot reduce the prices at which cars are offered to customers. 

Ford found a solution to this. Why not make everything by itself from scratch, from steel to tyres to parts. This will ensure that the same high level thinking to improve efficiency of production at high quality and lower raw material costs are incurred by Ford and thence charged to the customer through lower prices for Ford products.

I have been engaging the subject of Lean Operations for the past more than ten years in Alliance University Bangalore and have taken lots of industry workshops on the above topic. Little did I know or ever dream that the same principles used by Toyota in the 60s and 70s and later expanded as Lean Manufacturing practiced by world manufacturing and service organisations around 80s, 90s and still continuing, they have all been copied from Ford's production / manufacturing philosophy.

Why could not Ford motor company carry forward the revolutionary thinking on simple and efficient production system to benefit itself in the long run.  Even though I feel Toyota picked up Ford's production philosophy quite late, it was Toyota who could bring the substance, rigour and discipline of efficient production systems in place, result of the discipline in the Japanese systems and culture, so necessary to get high quality production out from the factory.

 

Ford and Edison (L2R) 1927 ..

In the book we even find how Ford encourages and implements the plans proposed by his shop floor workmen to improve workplace efficiency, what we in Japanese call as the Kaizen, more systematic and orderly application of incremental continual innovation on the Japanese shop floor. Ford believed that the line worker in touch with the machine and the process was most empowered and knowledgeable of innovations and changes that could be brought to products or processes on the production line more than anyone else on the shop floor, even the CEO.

The autobiography of Henry Ford, the doyen of world automobile sector, titled My life and work, is worth reading for any mechanical, automobile and industrial engineering enthusiast. It opens one's mind not only to the production systems and capability to the 1920s, published in 1922, but also tells us what were the thoughts that went through Henry Ford's mind, far ahead of dreams going thru the minds of existing American and other global manufacturers and customers. 

 

Ford River Rouge factory, Dearbon, Michigan, 1944

In fact, Ford was far ahead of the competition and thought of customer delight and obsession much earlier than any of the modern practitioners like Toyota or Amazon. He was among the first and earliest to propound the lean philosophy thinking to charge the customers less, produce less waste and  offer high quality products at low affordable prices to the masses (Motorolla's six sigma philosophy). 

 

In order not to charge the customers more, he looked at the vendor supply chain, exploring ways and means to reduce vendors costs by efficient working, manufacturing to scale and cheaper availability of resources. The result was Ford had facilities across the whole supply chain right from rubber plantations to produce rubber tyres to owning iron ore mines to produce steel for the automobiles.

Henry Ford, the founder of Ford Motor Company, turned to the Brazilian rainforest in the 1920s to construct a rubber plantation that would serve as his personal supply of the material. The town, dubbed Fordlandia, was more than an industrial operation — it was Ford's attempt to establish a picturesque American society - Businessinsider, Feb 20

Ford Motor Company once owned 700,000 acres of forest, iron mines and limestone quarries in northern Michigan, Minnesota and Wisconsin. Ford mines covered thousands of acres of coal-rich land in Kentucky, West Virginia and Pennsylvania - www.thehenryford.org

After going through the book, I am more than convinced that the concepts of efficiency and value resulting in customer satisfaction was initially introduced to the world Henry Ford and later carried forward by Taichi Ohno and Sakichi Toyoda from Toyota and others. The world of global manufacturing owes to Henry Ford than to any other personality in post industrial 20th century global manufacturing for bringing in the modern concepts of value and customer obsession.

George.

An analysis of The Republic by Plato, published in 380 BC

I am getting to the end of reading The Republic by Plato (written in 380 BC), the final 50 pages of this massive 400 page philosophical treatise, the first of it's kind on modern day concepts of Justice, Democracy, Mathematics, Music, Gymnastics etc .. This extraordinary philosophical work is said to be the basis on which the modern western thought systems of justice and development is based.

Plato

The Athenian philosopher Plato (c. 428-347 B.C.) is one of the most important figures of the Ancient Greek world and the entire history of Western thought. In his written dialogues he conveyed and expanded on the ideas and techniques of his teacher Socrates. www.history.com. Image courtesy Britannica.com

Plato, student of Socrates, penned his philosophical treatise, the first in the world, contemporary to the Old Testament in the Bible, in his chaste Greek language around 380 BC. Many of the concepts were new to me and I am trying to understand and assimilate them to my thought process. The concept of city states and their armies, medical profession, the equality of the sexes or what is expected of each sex, duties of politicians and administrators,  respect for elders, teaching youngsters gymnastics and music to make them learned and cultured were some interesting concepts discussed in the book. 

The art of fighting in battles, the classification of society into farmers, traders and warriors was interesting to read. The concept of slavery that existed then and of freedom is also penned by Plato. It was not clear whether Plato supported slavery or not. How can a man be just or unjust in his approach made interesting reading. 

Plato was was fortunate enough to be born into a rich family, got good  education under Socrates on knowledge that existed at that time. Towards the end of the book Plato talks of various forms of governance like Aristocracy, Timocracy (only property owners tend to take part in government), Oligarchy, Democracy, Autocracy etc. While reading I could relate his writing and thinking to the present day society.  He speaks how in society oligarchs exist, like Putin of Russia and tyrants like Kim Jong Un of North Korea, 2400 years back itself, and we see such people in present day society.

 

What really surprised me was the very last paragraph of the book where Plato talks of the heavenly way, to be just and of virtue. He agrees the soul is immortal and can endure all forms of goodness and evil. He exhorts all of us to love one another and also respect and love the God who guides over us all.

This writing is my humble, inexperienced, naive analysis and an earnest and sincere attempt to understand and interpret a great philosophical work written 2400 years back. I am too small to interpret and comment on the writing of Plato, but would love to accept the realities of the time and give my very immature comments to the practices of the time.

George 

High time the world shifted to Linux OS

As a humble member of the global teaching fraternity, I do a lot of IT related work that improves my working efficiency.  For example, work on the computer like accessing my official and private email, the Institute portal, use Google documents to prepare documents, write papers, download docs, write blogs, cases, read articles from high quality resources of the web and so on. For the past four years, the interesting part has been that all the above work is cloud based, on remote servers and not on local Institute servers.

Also, all the while over the past five six years, I have been working on a Linux based USB on Ubuntu distribution, to log from my office windows machine through Linux OS and access the Internet. The experience is cool. 

No worries of safety, security, unauthorised access and so on. With double security checks for my Google cloud, it has never failed me the last twenty years, no fears of unauthorised access to the Google cloud. Every time I access the net using Ubuntu Linux, a different IP address is automatically assigned, so it is the most safest way to access the net.

For all personal and office work I use only the Google office suite and access the Google cloud for storage of docs, 15 GB free and for Institute files I access the 100 GB One Drive, which is a Linux based cloud from Microsoft to store and access official files for which our Institute pays Microsoft.

Anyway you look at it, I have not accessed the hard drive on my local machine at College at least for the past 4 years, all the time working on Linux USB. (usually carry four USBs in my bag having four different distros, just for the fun of it). All important files are on my personal Google cloud or the MS office cloud.

Not sure whether I am the only teaching faculty from Alliance University to work on Linux all the time, a practice  continuing  from my IIT Bombay days, thanks to my mentor and guru, Prof. Uday Gaitonde, a die hard Open Source Linux fan.

Using the Google cloud and Google AI for academic purposes have overnight, improved the quality of my understanding and research, better and more effective delivery of teaching material and finally effective student understanding and feedback monitoring mechanisms.

The cloud storage and working has actually simplified my access either through my mobile while traveling, a 10 year old HP laptop at home or the latest desktop machine from office. Thin client technology very much in action.

It is high time the University authorities start slowly discontinuing Microsoft licenses in the uty asking faculty to work the Open source way, install Ubuntu or any Linux distros on all machines, or even use Linux on USB as the learning curve is fast and steep. 

When we know that all the major back-end processes of the world, be it the OneDrive Cloud from Microsoft, social media like Facebook and Whatsapp, Google search and cloud, Youtube servers, Amazon, Netflix, AWS, Enterprise servers etc. you name it, hosted on the cloud, mostly Linux based cloud that can be accessed safely and securely through any Linux OS, do we really need Microsoft OS to access local drives ?It is the human mind that shows the initial fear and reluctance to move to a new free and open source system.

Hence it is my sincere request to the university authorities to use the money thus saved (Institute license for MS may be draining a couple of crores of rupees every year from uty funds) to buy better quality hardware, more Internet bandwidth, 3D printing machines, AI capability and so on.

George.