Management Hall of Fame: Leading Management Gurus
Alfred P. Sloan, (Alfred
Pritchard Sloan, Jr)
General Motors & The Executive Organization
(1875-1966)
- "I have never issued an order since I have been the operating head of
the corporation." (Alfred P. Sloan, Jr.)
- “A car for every purse and purpose.” (Sloan 1963, p. 438)
- "I am sure we all realize that this struggle that is going on though
the World is really nothing more or less than a conflict between two
opposing technocracies manifesting itself to the capitalization of
economic resources and products and all that sort of thing."
(Alfred P. Sloan, Jr.)
Key Work
- Alfred P Sloan was
a managing engineer who turned General Motors
(GM) into one of the largest automobile
companies in the world.
- Studied
electrical engineering and graduated from the Massachusetts Institute of
Technology in 1892.
- In 1916 his company merged with United Motors Corporation which
eventually became part of General Motors Corporation. He became
Vice-President, then President (1923), and finally Chairman of the Board
(1937) of GM. In 1934, he established the philanthropic, nonprofit
Alfred P. Sloan Foundation. GM under Sloan became famous for managing
diverse operations with financial statistics such as return on
investment; these measures were introduced to GM by Donaldson Brown, a
protege of GM vice-president John J. Raskob who was in turn the protege
of Pierre du Pont — the DuPont corporation owned 43% of GM.
- Credited with establishing annual styling changes,
from which came the concept of planned obsolescence. He also established
a pricing structure in which (from lowest to highest priced) Chevrolet,
Pontiac, Oldsmobile, Buick and Cadillac did not compete with each other,
and buyers could be kept in the GM "family" as their buying power and
preferences changed as they aged.
- These concepts, along with Ford's resistance to the change in the
1920s, propelled GM to industry sales leadership by the early 1930s, a
position it retained for over 70 years. Under Sloan's direction, GM
became the largest and most successful and profitable industrial
enterprise the world had ever known.
Key Milestones
- Bought a controlling interest in Hyatt Roller Bearing Company.
- He became president of a Hyatt Roller Bearing a company that made
roller and ball bearings in 1899.
- Hyatt made profits of $60 million.
- Became president of the United Motors Corporation.
- United Motors becomes part of General Motors.
- Became the president of General Motors.
- Introduced rigorous financial
controls, restructured the company
along divisional lines with an executive committee sitting above the
divisions. Thus creating the executive manager
- Sloan's organization design became the organizational blueprint for
corporations for the next century.
Books & References:
-
Alfred P Sloan., Jr., with Boyden Sparkes. Adventures of a White Collar Man
 . Manchester, NH: Ayer, 1977.
-
Alfred P Sloan., Jr. My Years with General Motors . New York: Doubleday,
1990.
- McDonald, John. A Ghost’s Memoir: A Ghost's Memoir: The Making of Alfred P. Sloan's My Years with General Motors . MIT Press, 2003, ISBN 0262632853 online
review;
- Pelfrey, William. Billy, Alfred, and General Motors: The Story of Two Unique Men, A Legendary Company, and a Remarkable Time in American History . Amacom
Publishing, 2006.
- Waddell, William H.; Bodek, Norman [2005]. Rebirth of American Industry - A Study of Lean Management. ISBN 0-9712436-3-8.
- Alfred P Sloan. "My Years
with General Motors" New York: Doubleday,
1964.
Related Resources:
IIM Executive Education & Management Training
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