Mass Production and Vertical Integration at Ford in the 1920s

by: Robert E. Kennedy

Publication Date: December 5, 2010
Length: 4 pages
Product ID#: 1-429-003

Core Disciplines: Entrepreneurship & Innovation, Operations Management/Supply Chain, Strategy & Management

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Teaching Note

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This mini-case provides a concise description of Ford’s early history, highlighting milestones like the debut of the Model T, the use of labor specialization, the first moving assembly line, the famous “$5 a day” plan for employee motivation, etc. The mini-case focuses on the challenges that Henry Ford faced (timing production activities, industrial shortages, price increases, etc.) and how vertical integration helped him to overcome many of these challenges.

Teaching Objectives

After reading and discussing the material, students should:

  • Describe how and why Ford Motor Company grew so quickly after it introduced the Model T.
  • Explain how Henry Ford extended the firm's reach up and down the value chain.
  • Evaluate the various reasons a company today is not organized with extensive vertical scope.