The Expanded and Annotated My Life and Work

“HOUSECLEANING” DOES NOT MEAN LAYOFFS
Reassignment of workers from nonvalue-adding work to value-adding 
work will correct most financial problems. Note also the virtues of flat 
organizations in which supervisors have relatively wide spans of control; 
one foreman was adequate for 20 line workers. Ford emphasizes specifi-
cally that elimination of all forms of waste is the key to low costs and low 
prices. This includes the waste of time, and an increase in turnover equates 
to reduction of cycle time and also inventory.
* * *
Then we were ready for full production. And gradually into full production we 
went—on a profitable basis. The house-cleaning swept out the waste that had 

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Money: Master or Servant?  •  159
both made the prices high and absorbed the profit. We sold off the useless stuff. 
Before we had employed fifteen men per car per day. Afterward we employed 
nine per car per day. This did not mean that six out of fifteen men lost their 
jobs. They only ceased being unproductive. We made that cut by applying the 
rule that everything and everybody must produce or get out.
We cut our office forces in halves and offered the office workers better jobs 
in the shops. Most of them took the jobs. We abolished every order blank and 
every form of statistics that did not directly aid in the production of a car. 
We had been collecting tons of statistics because they were interesting. But 
statistics will not construct automobiles—so out they went.
We took out 60 per cent of our telephone extensions. Only a comparatively 
few men in any organization need telephones. We formerly had a foreman 
for every five men; now we have a foreman for every twenty men. The other 
foremen are working on machines.
We cut the overhead charge from $146 a car to $93 a car, and when you 
realize what this means on more than four thousand cars a day you will have 
an idea how, not by economy, not by wage-cutting, but by the elimination of 
waste, it is possible to make an “impossible” price.
Most important of all, we found out how to use less money in our business 
by speeding up the turnover. And in increasing the turnover rate, one of the 
most important factors was the Detroit, Toledo, & Ironton Railroad—which 
we purchased. The railroad took a large place in the scheme of economy. To 
the road itself I have given another chapter.