Are the chief executives who are breaking up the largest and best of America’s corporations making the right decision?
Alfred P. Sloan would probably remark that the weakness in these institutions isn’t within the size and scope of their corporations, but in their top executives’ limited thinking and over-centralization of their organizations.
“It is often extremely difficult to get a man [an executive] in the frame of mind where he will gladly seek to gather from other people in the organization what would offset … his [or her] own weakness.
“Yet this must be done in a large organization to bring about a maximum of efficiency and effectiveness.”
Although this concept was not articulated directly by Watson Jr. when he reorganized the IBM Corporation after the death of his father, coordinated decentralization was at the heart of how the son kicked in the IBM’s growth afterburners.
It is a concept that should be revitalized before breaking up the largest and best of our old American, industrialist-built institutions: IBM, General Electric, and Johnson and Johnson. Industrialist-minded chief executives understand that larger is better … easier to control … and easier to manage with coordinated decentralization … Chief executives must empower their top generals to lead but be ready to exercise a "coordinating influence" when necessary.
Who are America's chief executives’ top counselors? Would they listen to Alfred P. Sloan?
The country needs more industrialist-minded leaders …
… like Alfred P. Sloan.
Peter E. Greulich
Pete has been studying IBM and early American corporate history since his retirement in 2011. These are his thoughts and musings, and of those whose biographies he has read with links to articles and book reviews on this website.