“You can preach a better sermon with your life than with your lips”
– Oliver Goldsmith
A quick tour through the life of a few exceptional entrepreneurs of yesteryears is a great way to learn the various nuances of entrepreneurship. It is not just a study of history but a great insight into how they lived their lives and changed the world, how they practiced entrepreneurship and their philosophies and idiosyncrasies.
Akio Morita (1921-1999)
“Don’t be afraid to make a mistake. But make sure you don’t make the same mistake twice.” said Akio Morita, the man who founded and grew Sony.
Born into a family of traditional brewers on 26 January 1921, Akio broke tradition and did not pursue the 400 year old family business much against his father’s wishes although he was being groomed from childhood to join the family business. Instead he became a physicist again against his father’s wishes that he study economics. Akio Morita took the road less traveled and built an empire that is now a superstar that we all know today as one of the most trusted brands in the world – Sony.
When Akio was about 25 years old and serving the Imperial Japanese Navy, he met Masaro Ibuka, then 38, another engineer with whom he formed the Tokyo Tsushin Kogyo (Tokyo Telecommunication & Engineering Industries). With about 20 employees and a capital investment of ¥190,000 then (some 530 US Dollars), Ibuka was in charge of product development and research while Akio looked after everything else like marketing, finance etc. They developed the magnetic recording tape in 1949 and a year later in 1950 sold the first tape recorder in Japan.
Akio was a branding guru par excellence. He envisioned that a strong brand that conveyed a certain flavor of assured quality and responsibility could take the world by storm. His company TTK was re-christened as Sony, a move that was looked at askance by traditional businesses. He chose Sony to represent sonus in Latin meaning sound and Sonny-boys is Japanese slang for “whiz kids”.
At a time when Japanese companies were manufacturing products for famous Companies like Honeywell, Ricoh, Sears and the like, Akio ventured to create a Japanese Brand that crossed the national borders to become one of the first global corporations. The band he created had such a presence in the US market that Sony challenged the householder names like Coke and G.E.
The first smart move that Sony made was to do an “entrepreneurial judo” (the phrase is courtesy Peter F. Drucker). Bell Labs (of AT&T) that produced Nobel Laureates invented the “transistor” and everyone had expected that this device would replace vacuum tubes or valves as they were called. In fact this invention went almost unnoticed in the US with the press and industry not giving enough publicity at all. So the technology was branded as “not yet ready”, although its use was spreading in the military.
Akio read about the transistor in the newspapers. He quickly went to the America and cleverly bought a license for the new transistor from Bell Labs for a small sum. Two years later Sony transformed the radio market. In 1957, a portable transistor radio that was very much lighter in weight and price than conventional table model valve radios was branded as Sony and it stormed the US market and later monopolized the world radio market. Akio was an agile entrepreneur who saw an opportunity and moved swiftly to exploit a foreign market and mass produced the transistor.
Sony Corporation was established in the U.S. in 1960 and Sony became the first Japanese company to list on the New York Stock Exchange. Akio set up a home in America in 1963 to be closer to the market.
Sony went on to produce the famous walkman, an original invention of Akio Morita whose inventiveness found no boundaries. Walkman was so successful that the phrase entered the English lexicon. Several of the Sony products are world class and have stood the test of time. In Morita’s own words, they made Sony the Cadillac of electronics.
Being an avid sports man he was always energetic and vivacious. Morita followed almost a punishing schedule. He used the forward planner feature of his calendar to the hilt; his diary was always full a year or more ahead. He used to trot the globe and was keen to meet people from diverse cultures. (Similar traits that I have observed in one of India’s most celebrated and successful entrepreneurs – N.R.Narayanamurthy of Infosys – a punishing schedule, a very full forward looking diary and a strong appetite for travel).
His energies were not confined just to Sony. As early as 1966, he authored a book – Never Mind School Records – where he stressed that in the real world other skills mattered more. In 1986, he authored his biography Made in Japan. Sony acquired the famous motion picture company Columbia Pictures in 1989. He invited controversy when in 1991 he co-authored an essay (with politician Ishihara) called The Japan that Can Say No. It was considered anti U.S. and least expected from Akio who had embraced everything American. But there are different opinions that he was misquoted and it was unlike for Akio to have made controversial statements. Perhaps it was the collaboration with the political leader Ishihara that caused the problem.
Akio Morita while playing tennis on November 30, 1993 had a massive stroke and was confined to the wheel chair from then on. That day he was to have taken the chair of the prestigious Japanese Business Association – the Keidanren, almost like ascending to the throne of the Japan. But it was not to be. He resigned as the Chairman of Sony in 1994. Five years later at the age of 78, he died of pneumonia on October 3, 1999.
Henry Ford (1863-1947)
A business that makes nothing but money is a poor business said Henry Ford, the great American Car Maker.
Henry Ford was born to Irish immigrants parents and worked in the family farm before he moved to Detroit. While working for the Edison Illuminating Company when he was about 28 years, he invented and built his Quadricycle which he drove through the streets of Detroit. His first company Henry Ford Company was taken over by investors after he resigned in 1902 over some disputes with the bankers . That company became Cadillac. He set up Ford Motor Company when he was about 40 years old (1903) and the famous Model T Car was on the road after 5 years in 1908. (One Hundred Years ago!!)
When Ford decided to enter business in 1903, he was sure that his skills were in engineering and did not have a flair for running admin, finance, personnel, marketing, sales, and distribution. He found James Couzens. This is exactly what Soichiro Honda, the founder and builder of the famous Honda Motor Company in Japan did almost 40 years later !!.
Couzens, (who later became mayor of Detroit and Senator from Michigan could well have become the President of United States but for being born in Canada) was less known for his numerous contributions to the success of Ford Motor Company including profit sharing with workers and many other pioneering initiatives. The story goes that Couzens was so effective that Henry Ford could not stand his success. Couzens had fought with Henry Ford that Model T was obsolescent and required a successor very soon. All these encounters led to Henry Ford sacking Couzens in 1917. It is reported that Couzens sold his interest in the company to the Ford family for $35,000,000 in 1919 !!
Henry Ford soon took over all the top management functions (he was 54 years then), which he once knew were not his cup of tea. The result was a blind and dogged effort to stick with Model T for the next ten years until it became not saleable at all. It is history that it took the Junior Henry Ford II (grandson of Henry Ford Sr.) considerable effort to put the company back on rails, a good 30 years after Couzens was sacked.
Henry Ford was a versatile personality and a man of varied interests. Many know about him as the great American Car Maker. But he ventured to do many other things that will baffle you.
* Unsuccessfully contested for the US Senate in 1917
* Ran a newspaper Dearborn Independent that offended the Jews and earned him a bad name
* During World War II, he financed a peacekeeping expedition to Europe.
* Allowed the use of his factories to produce Tanks, Jeeps and Bombers for the Second World War.
* Opposed Trade Unionism until courts demanded that he refrain from interfering with union activities.
* Set up several schools to promote “learning through doing”
* Helped build village industries and small factories in rural areas.
* Encouraged use of agricultural products (soybean based plastic) as auto components.
He lost his son Edsel B Ford (aged 49 then) in 1943. Henry Ford passed away 4 years later at a ripe age of 83 years.
Edsel later became the name of another American Car that failed miserably (1957) . Edsel was an answer to rival GM’s Buick & Oldsmobile. Introspection and investigation on Edsel’s failure resulted in concluding and attributing the fiasco to change in perceptions driven by demographic shifts, something that all the market research, customer preferences studies could not reveal. Ford Motor came back with vengeance. The Thunderbird was a huge and phenomenal success that immediately took the company to grater heights but at the hands of Junior Henry Ford II.
Henry Ford’s lived a colorful life full of actions and contradictions. He was an amazing entrepreneur whose idiosyncrasies were rather pronounced. An individual of tremendous convictions he fostered a parental care for his workers. But he was not infallible.
Just imagine what could have happened to Ford Motor Company if James Couzens was not fired by Henry Ford !! For your knowledge Couzens died in 1936 at the age of 64.