Reading: Henry Ford, “Today and Tomorrow” (1926)

In 1926, when Henry Ford was at the height of his industrial reputation and Highland Park was still the most-studied factory in the world, Ford and his collaborator Samuel Crowther published a book setting out the principles by which his company had remade American manufacturing. They called it Today and Tomorrow. Twenty-four years later, Eiji Toyoda and Taiichi Ohno read it carefully — Ohno in particular returned to the book and to Ford’s earlier My Life and Work repeatedly through the 1950s and 1960s — and built the Toyota Production System out of the same operational instincts. The book is, in other words, the originating text of Lean. It is also the originating text most contemporary Lean readers have not read.

The book is short, plainly written, and largely free of the corporate-philosophy register that disfigures most twentieth-century management writing. Its eight central chapters set out, in order, the principles Ford organised the Highland Park and River Rouge plants around: paying high wages, building only what is needed, eliminating waste, integrating the supply chain, designing the product for ease of manufacture, and treating the people who do the work as the firm’s most important asset. None of these are claimed as innovations; Ford treats them as the obvious consequences of paying close attention to one’s own operation.

Chapter eight, Learning from Waste, contains the passage the practice has carried back into client conversations more than any other:

> Take a vein in a coal mine. As long as it remains in the mine, it is of no importance, but when a chunk of that coal has been mined and set down in Detroit, it becomes a thing of importance, because then it represents a certain amount of the labour of men used in its mining and transportation. If we waste that bit of coal — which is another way of saying if we do not put it to its full use — then we waste the time and energy of men. A man cannot be paid much for producing something which is to be wasted.

The argument that follows is the one Ohno would later formalise as the seven wastes (the eighth, talent unused, was added decades later): waste of material is not principally about material, it is about the labour the material carries. The cost of a discarded part is the cost of the time spent producing it, transporting it, inspecting it, and then disposing of it; and that time has to be earned back somewhere. Ford’s plain prose makes this arithmetic visible to a reader without any operations training, and is exactly the kind of writing the practice tries to imitate when explaining waste to a new client.

The chapter on wages — which argues, against the prevailing economic orthodoxy of 1926, that high wages are not a cost to be minimised but a precondition for the productivity that funds them — is the one most often misunderstood. Ford’s Five Dollar Day was not a generosity programme; it was a calculation. A worker who earns enough to buy the car he assembles will, in aggregate, produce a market for the cars he assembles. A worker who earns enough to live in a stable household will not require the firm to hire and train his replacement six times a year. The book’s economics is operational, not moral, and it remains the clearest statement available of the Lean principle that the cost of poorly paid labour is paid in full further down the income statement.

Two things in the book are worth re-reading specifically against contemporary Lean practice. The first is that Ford treats waste and the dignity of the worker as two halves of the same proposition; the modern Lean canon has tended to separate them, with waste-elimination kept as the operational discipline and respect-for-people kept as the cultural one. Today and Tomorrow refuses that division and reads better for it. The second is that Ford treats integration — the firm’s own coal mines, glass works, rubber plantations, ore ships — as an operational discipline rather than a strategic one. He integrated upstream not for market power but because he could not get the quality and timing he needed any other way. The contemporary fashion is the opposite, and the practice’s clients sometimes pay the price of that fashion in supply-chain failures Ford would have recognised at fifty paces.

The book is one hundred years old this year. Almost everything in it is still operationally true.

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