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Avoid Wasteful Transportation
Transportation is essentially a necessary evil that adds no value to the
product. Ford cites grain as a product that should be processed into flour
prior to shipment to eliminate wasteful transportation. It also was his
practice to ship dry wood instead of green (wet) wood from his lumber
operations because the water in the wood carried weight but no value.
Supply chain managers should pay particular attention to Ford’s state-
ment, “One angle of the transportation problem to which too few men are
paying attention is this useless hauling of material.”
Ford and Crowther (1930, p. 273) add that it would be ideal, although it
is not practical, to process iron ore at its mine to avoid transportation of
what would eventually become slag.
The Railroads • 211
* * *
One of the great changes in our economic life to which this railroad policy
contributed was the centralization of certain activities, not because central-
ization was necessary, nor because it contributed to the well-being of the
people, but because, among other things, it made double business for the
railroads. Take two staples—meat and grain. If you look at the maps which
the packing houses put out, and see where the cattle are drawn from; and
then if you consider that the cattle, when converted into food, are hauled
again by the same railways right back to the place where they came from,
you will get some sidelight on the transportation problem and the price of
meat. Take also grain. Every reader of advertisements knows where the great
flour mills of the country are located. And they probably know also that these
great mills are not located in the sections where the grain of the United States
is raised. There are staggering quantities of grain, thousands of trainloads,
hauled uselessly long distances, and then in the form of flour hauled back
again long distances to the states and sections where the grain was raised—a
burdening of the railroads which is of no benefit to the communities where
the grain originated, nor to any one else except the monopolistic mills and
the railroads. The railroads can always do a big business without helping
the business of the country at all; they can always be engaged in just such
useless hauling. On meat and grain and perhaps on cotton, too, the trans-
portation burden could be reduced by more than half, by the preparation of
the product for use before it is shipped. If a coal community mined coal in
Pennsylvania, and then sent it by railway to Michigan or Wisconsin to be
screened, and then hauled it back again to Pennsylvania for use, it would not
be much sillier than the hauling of Texas beef alive to Chicago, there to be
killed, and then shipped back dead to Texas; or the hauling of Kansas grain
to Minnesota, there to be ground in the mills and hauled back again as flour.
It is good business for the railroads, but it is bad business for business. One
angle of the transportation problem to which too few men are paying atten-
tion is this useless hauling of material. If the problem were tackled from the
point of ridding the railroads of their useless hauls, we might discover that we
are in better shape than we think to take care of the legitimate transportation
business of the country.
In commodities like coal it is necessary that they be hauled from where
they are to where they are needed. The same is true of the raw materials
of industry—they must be hauled from the place where nature has stored
them to the place where there are people ready to work them. And as these
raw materials are not often found assembled in one section, a considerable
amount of transportation to a central assembling place is necessary. The coal
comes from one section, the copper from another, the iron from another, the
wood from another—they must all be brought together.
212 • The Expanded and Annotated My Life and Work
But wherever it is possible a policy of decentralization ought to be
adopted. We need, instead of mammoth flour mills, a multitude of smaller
mills distributed through all the sections where grain is grown. Wherever it
is possible, the section that produces the raw material ought to produce also
the finished product. Grain should be ground to flour where it is grown. A
hog-growing country should not export hogs, but pork, hams, and bacon.
The cotton mills ought to be near the cotton fields. This is not a revolution-
ary idea. In a sense it is a reactionary one. It does not suggest anything
new; it suggests something that is very old. This is the way the country did
things before we fell into the habit of carting everything around a few thou-
sand miles and adding the cartage to the consumer’s bill. Our communities
ought to be more complete in themselves. They ought not to be unnecessar-
ily dependent on railway transportation. Out of what they produce they
should supply their own needs and ship the surplus. And how can they do
this unless they have the means of taking their raw materials, like grain and
cattle, and changing them into finished products? If private enterprise does
not yield these means, the cooperation of farmers can. The chief injustice
sustained by the farmer to-day is that, being the greatest producer, he is
prevented from being also the greatest merchandiser, because he is com-
pelled to sell to those who put his products into merchantable form. If he
could change his grain into flour, his cattle into beef, and his hogs into hams
and bacon, not only would he receive the fuller profit of his product, but he
would render his near-by communities more independent of railway exi-
gencies, and thereby improve the transportation system by relieving it of
the burden of his unfinished product. The thing is not only reasonable and
practicable, but it is becoming absolutely necessary. More than that, it is
being done in many places. But it will not register its full effect on the trans-
portation situation and upon the cost of living until it is done more widely
and in more kinds of materials.
It is one of nature’s compensations to withdraw prosperity from the busi-
ness which does not serve.
We have found that on the Detroit, Toledo & Ironton we could, following
our universal policy, reduce our rates and get more business. We made some
cuts, but the Interstate Commerce Commission refused to allow them! Under
such conditions why discuss the railroads as a business? Or as a service?
213
17
Things in General
The first part of this chapter describes Ford’s relationship with inventor
Thomas Edison and naturalist John Burroughs. These three men, along
with Harvey Firestone, constituted the “Vagabonds” who often took road
trips together. However, it is not particularly important to a thorough
understanding of Ford’s management system, and we have omitted it in
the interests of conserving space. The next section shows how industry
can abolish the root causes of war, and then it provides a very valuable
warning against the role of propaganda in fomenting war.
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