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Alfred P. Sloan

By: Mick Yates

Whilst he embraced the scientific manufacturing methods of Frederick Taylor et al, he realised that the marketplace needed to more directly drive his company's success.

He was able to take the best the theorists could offer, with a new set of organizational solutions. Sloan thus developed a "decentralized bureaucracy", as each of the GM Divisions was intrinsically bureaucratic. Each Division had a full set of assets and resources, autonomous management, designed its organization to meet its unique needs, could enter its own external alliances and business deals, and often saw itself in "friendly" competition with other Divisions.

General Motors as a company moved away from vertical integration to focus on frequent new models - building "a car for every purse and purpose".

Whilst Ford was following strict Taylorist systems in building the famous "black cars", General Motors sold cars in all shapes and colours, and took market leadership. It was a strategy that would stand the company in good stead for decades.

Divisionalization became the prevailing business paradigm as firms became multinational in the rapid expansion phase after World War II. International subsidiaries were started which copied the home country's full range of resources and skills, althuogh with little thought to global or even sub-regional efficiency and the pitfalls of "silo thinking".

Nevertheless, Alfred Sloan was without doubt one of the greatest Corporate innovators of all time.

Mick Yates

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