Excellent book. Men and Rubber was originally published in 1926 by Harvey Firestone, founder of Firestone Tire and Rubber Company. Amazon page.
I have never found it worthwhile to bother with thoroughly little fellows for, realizing their weakness, they are always on the defensive, while a larger man will listen to what you have to say and be quick to grasp any money-making opportunities you may have to offer.
The only firm rule I have is to take up one thing at a time and to take up nothing else until my mind is free.
There is no expedient to which a man will not go to avoid the real labour of thinking.
I have never found that pay alone would either bring together or hold good men. I think it was the game itself that drew these men; we were a little company fighting among big companies, and we were all together in the fight.
Every change we made in the sales methods brought results—and proved the new method. We did not know that we would have shown as startling an increase had we abolished our whole sales force, closed all our branches and dealers, and just sent out our tires in freight cars to be thrown off on sidings and taken away by clamouring buyers.
The single reason for the existence of any business must be that is supplies a human need or want.
It is a gift to keep silent when one has nothing to say!
No business can succeed unless it is constantly revisiting its product, not only to meet the actual demands of today but also the potential demands of tomorrow.
Competition rarely puts anyone out of business—a man usually puts himself out of business either by not making a good article or by wrong methods in sales or finance.
The real important matters cannot be settled by the application of rules.
There is no expedient to which a man will not go to avoid the real labour of thinking.
An executive cannot dismiss details. Business is made up of details, and I notice that the chief executive who dismisses them is quite as likely as not to dismiss his business. I believe in one-man control—no business is large enough to survive divided authority.
A man may keep very busy indeed without doing any thinking at all, and the easy course—the course of least resistance—is to keep so busy that there will be no time left over for thought. ["small size affords space to think" from Zero to One.]
A committee may function very well indeed as a clearinghouse for thoughts, but more commonly a committee organization is just an elaborate means of fooling oneself into believing that a spell spent in talking is the same as a spell spent in thinking.
It is really a misnomer to call the directing head of an enterprise an "executive." He cannot possibly be an executive and hold enough time back to think. The execution must be done by others, and one of the vital, ever-present problems, as a company grows wealthy, is keeping executives on the job of executing.
Neither [Ford nor Edison] is an inventor in the ordinary sense, for they do not stumble upon things by accident; they start with what they want to achieve and then think our the methods of achievement.
Business is founded on thought.
Good management—that is management with real thought behind it—does not bother trying to make its way by trickery, for it knows that fundamental honesty is the keystone of the arch of business.
If you ask yourself why you are in business and can find no answer other than "I want to make money," you will save money by getting out of business and going to work for someone, for you are in business without sufficient reason. A business which exists without a reason is due for an early death. The single reason for the existence of any business must be that is supplies a human need or want.
I had put everything I earned into this stock, for I believe that a man is not truly in his business unless he has his all in it.
It was time for quick thinking [after the value of the stock dropped below the amount of the loans it secured], but above all for thorough thinking, and in the excitement, everything made for taking action instead of taking thought. But first I took thought, and I took counsel, and then I took action, with the result that we reduced our bank loans twelve million dollars in a couple of months.
A business is not a business until it has been hardened by fire and water. [Reminds me of Jeremy Giffon's idea of pre- and post-fall.]
It does not require any thought to do business in a period of rising prices, and we had gotten out of the way of thinking.
But vision, as I see it, is not a dreaming forward. It is a thinking through with the values ever in mind.
Quick decision that have not behind them a long train of thought are exceedingly dangerous.
Thinking is not required all the way down the line in business. The difficulty is to pick out the men who can and will think and get them into the positions where thought is needed.
Having a surplus is the greatest aid to business judgment that I know.
A man with a surplus can control circumstances, but a man without a surplus is controlled by them and often he has no opportunity to exercise judgment.
My father had the rare foresight to know that a fine crop one year was more or less a fortunate accident and did not set a figure to be followed during future years. Consequently, he always had plenty of money to lend on mortgage to those around him who, although they had all his farming advantages, did not have his foresight.
Never rush in on a deal. Let it come to you.
No one ever tried to cheat [my father]. This may have been because of respect, or again it may have been because cheating my father required considerably more than the ordinary trader's brain.
In a day when few farmers read anything, he was a wide reader and accumulated a large fund of knowledge, which is one of the reasons why he was a good farmer. I notice that when all a man's information is confined to the field in which he is working, the work is never as good as it ought to be. A man has to get a perspective, and he can get it from books or from people—preferably from both.
A man ought now and then to get far enough away to have a look at himself and his affairs. Otherwise, he gets lost in the details and forgets what he is really doing.
In a few cases, a big house is built just as an advertisement that one is rich; sometimes a big house is built so that great entertainments may be given. But in most cases, and especially with men who have earned their own money, the house is just built, and when it is done, no one quite knows why it was ever started.
The proprietors of the little stores would not bother to listen to me. Although they did not seem to be doing anything, they said they were too busy to talk with me. The proprietor of the big store was busy—but he had plenty of time to listen on my story and to find out if he could make money out of what I had to sell. From that time onward, I have never found it worthwhile to bother with thoroughly little fellows for, realizing their weakness, they are always on the defensive, while a larger man will listen to what you have to say and be quick to grasp any money-making opportunities you may have to offer.
First principle of salesmanship—you must thoroughly believe what you have to sell. Then selling becomes merely a matter of showing how your product will help a prospect.
Salesmanship has to establish a continuing relation in which the seller helps the buyer.
It is the duty of management to provide so good a product and then to let people know so thoroughly about it that any man of reasonable intelligence can go out and sell it.
[On finding a business partner:] I invited [a good prospective partner] for a drive; and I took some pains to let him realize how much easier the riding was [with rubber tires] than with steel-rimmed wheels. Actually, I was making a demonstration, but without any proposition; I wanted him to sell himself before I did any talking.
Sometimes it seems that it might be better to go back to those simpler days, that one might get more out of a less complex life. But it cannot be done. One changes with prosperity. We all think we should like to lead the simple life, and then we find that we have picked up a thousand little habits which we are quite unconscious of because they are a part of our very being—and these habits are not in the simple life. There is no going back—except as a broken man.
These big rubber companies were better equipped to do a carriage-tire business than we were, but they did not seem quite to understand tires, and then, too, the volume of the business was small—it was just a specialty. [Innovator's Dilemma.]
[A] mistake I had made was in trying to borrow money from a bank without vision instead of from a bank with vision—although I had found out in selling that it did not pay to deal with small people.
It is not possible in beginning a new enterprise to see ahead far enough to discover how much capital really will be needed.
A business which starts off quickly, makes money at once, and seems to be in every respect a gold mine, often does not last long. It is just selling peanuts to the crowd in town for the circus—a once-around affair.
For three years we lost money on operations as a whole, but this did not bother me as to the eventual success of the enterprise, because I knew how and why we lost our money. Losing money is not pleasant, but every business must at times lose money. Losing money is really serious if you do not know why you are losing, or if you do know why and cannot help yourself.
A man of affairs does not want to be bothered in the evening... Just getting to a man is not enough—it is when and how you get to him. There are more wrong times to sell to a man than there are right times, and if I ever should write a book on salesmanship I should give about one third of the book to the topic "Common Sense."
I have never found that pay alone would either bring together or hold good men. I think it was the game itself that drew these men; we were a little company fighting among big companies, and we were all together in the fight.
No employee who is really non-productive ought to be retained. It is much easier to check up on who is really needed in production than on who is really needed in the indirect labour, and hence, every addition to the indirect or overhead expense should be studied vigilantly.
The public is always willing to pay for quality.
Competition rarely puts anyone out of business—a man usually puts himself out of business either by not making a good article or by wrong methods in sales or finance. [Similar to Bezos' customer obsession. Also, a company should focus on core reasons of its existence; and customers make and sustain companies, not competition.]
The best way to settle trouble is face to face.
The easy course was to take for granted that, having established a fair solid-tire business, that business would expand and continue, and there would be no need to go into new fields... I saw clearly that, if we limited ourself to solid tires, our business would slowly die. No business can succeed unless it is constantly revisiting its product, not only to meet the actual demands of today but also the potential demands of tomorrow.
There is always a better way of doing everything than the way which is standard at the moment. It is a good thing for a man to be pushed into finding that better way. [Constraints breed resourcefulness.]
It is a characteristic of Mr. Ford's that, no matter how perfect any mechanical device may seem on paper, he will accept it only after the most rigid tests.
Settling disputes through the law has never appealed to me as a pastime. Lawsuits are not only extremely expensive, but they do not and cannot settle anything which could not be better and more quickly settled through putting all the cards on the table and having a frank talk. A man who wants justice does not often have to go to courts to get it. In fact, he will compromise with something less than justice to keep out of court. A fair man is drawn into court only when the other side refuses to face the facts.
It is a fortunate thing for the industry that it was not favoured by the bankers, else it would have been financed by bond issues, and there have been several periods when these bond issues might have been foreclosed—which would have set back the industry for a number of years.
The public always roots for the underdog.
I then and always have regarded the stock of our company as something to buy and hold and not something to speculate in. I have never bought a share on speculation—that is, with the intention of selling again. The moment that officers or directors of a company begin to speculate in its stock, the ruin of the company is not far away, for it is impossible to serve both the company and the stock market.
I did not know how really important a laboratory was, and already having four or five places for every dollar that came in, I had no inclination to look for new ways of spending money. I did not know that the laboratory was at the very foundation of the tire industry.
If a man comes to you for the single reason that you offer him more money than he has been getting, he is not worth having, for then he is thinking too much of the money and too little of the job.
The biggest thing in business is to be working and planning ahead—planning ahead for production, for sales, for new developments in the art, for money, for sources of supply. The business of the day is, of course, highly important, for unless today's business be looked after, there will be no tomorrow's business to bother about. But unless one can see and plan for a year or two ahead, one's business will not grow evenly and naturally. It will pass through a series of emergencies and one of those emergencies will wreck it. Emergencies will come about in any business, but they will be few and not hard to meet if the future has been mapped. [Number of emergencies is a proxy for (lack of) planning.]
This is so self-evident that I wonder why it is so much neglected. The only danger in mapping the future lies in making the plans inflexible. No one can know exactly what will happen next month, let alone next year, but reasonable plans can always be made, and then they can be changed as circumstances require. A too rigid plan may be worse than no plan at all.
Manage oneself. Leave enough time for thinking.
Have flexible plans.
If anything in the business is wrong, the fault is squarely with management.
No amount of writing will take the place of action.
Use what common sense you have under the circumstances.
Success if the sum of details... If one attends only to great things and lets the little things pass, the great things become little—that is, the business shrinks. [Similar to Bill Walsh teaching a receptionist how to answer a phone after taking over the 49ers.]
I know of no better way of fooling one's self than writing interoffice communications and asking for reports.
The trouble with prosperity is that it hides the defects of a business.
Communicate information that matters. Simplify reports.
We are all doing this job together under the president and the vice president; each man has his special duties, but they converge upon the one point of getting the job done.
The only firm rule I have is to take up one thing at a time and to take up nothing else until my mind is free. [One word that accounted for Buffett's and Gates' success: Focus.]
The writing of letters can be a great time waster.
Clearly divide responsibilities.
Plan. But operate a business, not a plan.
Nothing is easier than to budget in mechanical fashion.
Expand out of surplus.
We do the best we can to forecast the price of rubber, but we never fool ourselves into holding this forecast to be anything more than a guess. [Harvey Firestone uses the word "fool" a lot. Interesting connection to Feynman: "The first principle is that you must not fool yourself — and you are the easiest person to fool."]
There is nothing wrong about guessing in business, unless you call it "estimating" and attach an undue importance to it.
The question I always ask myself when looking at any operation—whether in the shops or in the office—is this: Is it necessary?
If I do find a process or operation necessary, then I ask: Can it be simplified?
Both the automobile and the tire are still so young that it would be unwise to say what is going to happen in the future in the way of design.
We have a department which does nothing but view each operation with the two controlling questions in mind: Is it necessary? Can it be simplified?
Men without ability can never have enough capital, they will be continually out after money, for they will think that money can substitute for brains, and, of course, they will end in the bankruptcy court.
The eternal problem of business is men.
There is no preliminary test by means of which the quality of a man's judgment may be gauged, and even if there were, the matter of the man's whole fitness would not be determined, for there would remain the question of his compatibility.
The real important matters cannot be settled by the application of rules, although a guide may be had by the application of principles. And principles, it is well to remember, are quite different from rules.
Basic labor policies:
Provide the best possible working conditions.
Try to pay a somewhat higher wage than anyone else pays.
Provide rewards and facilities over and above whay any other company provides.
Insist that foremen treat their men as human beings.
Avoid the strict definition of the duties of any supervisor or foreman, in order that no man may easily pass the buck.
Support employees right after they've joined.
It is axiomatic that, to have an interested workman, he must know what he is doing. And in these days of subdivided labour it is becoming more and more difficult to have a man realize exactly the effect of his actions.
Many men coming out of college have no means of going into business, and while they may have the latent power to think, they have nothing to think about.
The biggest thing an employer can do is to help his men to help themselves.
We, in 1917, started an employees' stock savings plan by which any employee had the right to buy from one to ten shares of the common stock and pay for it through deduction from his pay envelope at the rate of seventy-five cents a week a share... Later, we made the purchase of two shares a condition of employment. I am informed that we are the only large company in the world in which every employee has a stock interest.
[Employees get rewarded for suggestions.] When you write us your suggestion, make perfectly sure in our own mind that it embodies an improvement upon the existing method, machine, raw material, or other item. Then, if you feel satisfied on this point, ask yourself further questions:
Will more work be produced?
Will better work be produced?
Will quality be sacrificed for quantity?
Will the proposed change pay for itself?
Will working conditions be improved?
If it were your plant and your money, would you make the change?
The place to start selling is in the factory, and if the articles we make are not good enough consistently to be sold to the public without any hypnotic processes, then they are not good enough to sell at all.
Don't get all of the business at once... A company that gets business too quickly acts just about as a boy who gets money too quickly.
Selling is first a matter of having something to sell, then of finding whom to sell to, and, finally, of finding reasons why this prospect should buy.
Almost everyone sees that it pays to sell a lot of goods, but not nearly so many see that no one sells a lot of goods who does not work hard. And hard work is, unfortunately, not a universal habit.
We have never been fond of the purely commission basis, because many men are short-sighted and they will neglect service and the steady customer of the future for the immediate customer on whom they can earn a commission.
Satisfied customers constitute the corner stone of this business.
That is what we are always after—a permanent relationship.
A salesmen accustomed to living on a sales stimulant becomes an addict, and he is no good without his drug.
We never forget that we are selling tires and not advertising.
Our selling efforts had nothing to do with selling, but they were amusing and kept a lot of people occupied.
No end of sales reputations are established by salesmen taking the credit for the public resolutely refusing to be deterred from buying.
I do not know where this organization bug came from, but, like the flu, it hit nearly everyone in the country. I am free to confess what it did to us, for it is over with, and we are immune.
Every change we made in the sales methods brought results—and proved the new method. We did not know that we would have shown as startling an increase had we abolished our whole sales force, closed all our branches and dealers, and just sent out our tires in freight cars to be thrown off on sidings and taken away by clamouring buyers. [Counterfactuals are hard to know, but essential to think about. FDA's invisible graveyard idea by Alex Tabarrok. Also Jeremy Giffon's quote that "a weird side effect of venture capital is that you never get to see the counterfactual on growth. So a lot of times, your company is growing for some reason, probably inherent to the product or something like that. But because you've taken all this venture capital, you have to spend it, you can't just leave it in your bank account. And so you'll hire a bunch of people or spend a bunch of money on dumb stuff and then you will falsely attribute that spending to the growth, but in fact, it was not at all related."]
We went over every part of that sales organization asking: "Can we get along without this job?" In 1921, we cut our sales force 75 percent over the peak of 1920. What is more important, we started it to selling.
A fair part of the time of the big, complex organization is spent in steering the effects of mistakes into other departments, and instead of an error being corrected, it is kept in the air.
We must compare what we are doing to-day with our opportunities of today.
It seems exceeding difficult to get our branch organization to "think." Of course, it is difficult for all of us to think hard enough and long enough to get a clear picture of the problems before us. Most of us go only part of the way, too many times, and some of us never get a clear vision or finish our problem, and that means failure, no matter how good our intentions are or what energy we exert.
Essential to success of branches:
Knowledge of product.
Knowledge of organization to the end of selling the product.
You [i.e. branch managers and salesmen] are not going to get this fundamental foundation for your success or the success of your salesmen by any long dissertation in book or letter, or oratorical accomplishment from an Akron representative—you are only going to get it from your own concentrated thought and energy.
Organize your daily work and concentrate your energies on each problem and see it through to the final finish.
Everyone looked forward to easy prosperity. When conditions changed, many were unable to adjust themselves and have spent much time and energy looking for a line of activity that would not require any hardship and sacrifice...
Overcome the habit of allowing small difficulties to become exaggerated in your mind by thinking out clear and convincing arguments against them.
Optimism and enthusiasm are very dangerous and disappointing unless you have a good foundation based upon knowledge and a plan on which you can and are determined to realize upon them.
Selling is not a matter of systems but of men.
A trained man who goes into the field with confidence and a knowledge of his goods can do well almost from the start.
I have always liked to be with big men—with men whose ideas extend beyond the little things near at hand and whose vision has no horizon.
[Edison and Ford] are both practical visionaries—they make their dreams come true. [Modern times example: "When Jobs took his original Macintosh team on its first retreat, one member asked whether they should do some market research to see what customers wanted. “No,” Jobs replied, “because customers don’t know what they want until we’ve shown them.” He invoked Henry Ford’s line “If I’d asked customers what they wanted, they would have told me, ‘A faster horse!’’’ Also Keith Rabois' "product market fit is forged, not discovered."]
Successful business is never conducted on rules; it is conducted on principles put into effect by human energy.
Edison: if only we had enough cheap power, we should be able to reduce manufacturing costs to a minimum and bring on widespread prosperity.
At three or four in the morning I got up, replenished the fire, and in a camp chair beside it indulged in the "long, long thoughts" which belong more to age than to youth. Youth was soundly and audibly sleeping in the tents with no thoughts at all.
Mr. Ford always thinks in terms of the greatest good to the greatest number. He aims to place all his inventions within the reach of the great mass of the people.
Mr. Firestone belongs to an entirely different type—the clean, clear-headed, conscientious business type, always on his job, always ready for whatever comes, always at the service of those around him.
Two points which Mr. Edison and Mr. Ford dwelt on, time and again, during our talks about the camp fire, were:
Own your business.
Keep plenty of cash in the bank—make the banks work for you.
Mr. Ford is both a mechanical genius and a business genius. He goes through conventions—through established practices—with a superb surety. He has the genius of reducing a problem to its elements in so simple a fashion that it does not appear to be a problem at all. [Strong first principles thinking.]
I doubt if Mr. Ford could have carried out more than a fraction of his plans had his business not been personal with him and his family.
Every American business of consequence has been built up by one man staying on the job. The corpoate form of organization is only a method of defining the interests of investors. It is not a form of management. And when the stockholders vigorously help in the management, the business cannot prosper.
The moment that a company starts paying dividends without regard for future needs, it is as good as finished.
Legitimate business ought to be protected and not interfered with.
A manufacturing operation should be carried through without a stop from the raw materials to the finished product, and no man can be said to control his business unless also he can control his sources.
It is Mr. Ford's thought that a good idea lives forever, and he wants to examine the things of the past to see what they contained in the way of good ideas.
It is a gift to keep silent when one has nothing to say!
Go it alone. Do not fail to try because someone has already tried and failed.
No business, no matter what its size, can be called safe until it has been forced to learn economy and rigidly to measure values of men and materials. [Similar to Lindy effect.]
The day is fast coming when competition is going to reduce the tire business to a survival of the fittest.
Situations are only as impossible as one makes them.
[The sales organization] only saw closed doors everywhere and had not the nerve to open them.
[Firestone got a lot of supply from Liberia after a British monopoly on rubber restricted supply.]
It is my opinion that if America is to attain any degree of independence in its source of supply of rubber as well as other materials, which are now in the hands of foreign monopoly, our government must give proper encouragement to capital and must assure the industries interested that it will lend its utmost assistance in protecting our investments.
The very worries and insistent demands on one's mentality and physique are a joy—for they are tests, challenges.
If business were a science, then one could learn the principles and let the thing run itself. But no business will run itself.
Business must earn money, and therefore it has to be watched day and night. It must earn money, else it will fail, and failure means that one has played the game and lost.
For unless a business earns, it must stop.
Our life is made up of experiences. Business leads one into every profession and every walk of life. It is the school of experience.
The greatest pleasure is in doing something to help other to help themselves.
[In business] there is the supreme satisfaction of accomplishment—of planning to do something and of carrying through those plans against all obstacles to a final accomplishment.
Business is made up of opportunities for great sacrifices and great accomplishments. It is the most absorbing occupation on earth.