Case Study on Productivity (1 of 3): Henry Ford and the Model T
When Henry Ford announced he was going to produce an automobile that would be affordable to the masses, he probably did not realize what a great impact his achievement would have on life in the United States and, eventually, the world. Ford’s use of mass production strategies to manufacture the Model T revolutionized industrial manufacturing and initiated a new era in personal transportation. This three-part learning unit provides students with the story of Henry Ford and the Model T from an economics perspective. Parts 1 and 2 explore how the Ford Motor Company successfully introduced mass production strategies to the auto industry. Students learn how specialization and investments in capital (machines, people, etc.) increased productivity and allowed Ford to slash the price of his popular vehicle. Students chart a plan for the assembly-line production of bookmarks, test their plan, and make recommendations for improvements. Students also explore how Henry Ford used economic incentives to address a problem created by mass production techniques—worker turnover. An optional Part 3 explains how increased productivity resulted in shifts in the supply and demand for the Model T. Students analyze how a variety of non-price determinants continue to influence the automobile market today. The unit also presents a wealth of extension activities.
Ask for a show of hands to indicate how many students own a car or would like to own one. Ask individual students what make of car they own or might purchase. When the students mention Ford automobiles, tell them that they are going to study how Henry Ford—the entrepreneur who established Ford Motor Company—revolutionized the car industry and life as we know it today. Nearly all large automakers–in fact, all manufacturers–use production techniques that Henry Ford popularized at the beginning of the 20th century. In the activities that follow, the students will learn more about how Henry Ford ' s production of the Model T helped to revolutionize the manufacture of automobiles and life as we know it today. They will be asked to adapt one of his strategies—the moving assembly line—for the production of bookmarks.
- Identify Henry Ford as an innovator who helped revolutionize modern manufacturing.
- Create a flow chart for an assembly line that illustrates how specialization can be used to increase productivity.
- Test and make recommendations for improving the productivity of an assembly line.
- Compare the assembly line process with the “cottage industry” approach to production, identifying advantages and disadvantages of each.
Henry Ford: The Innovator: This page provides a biography of Henry Ford.
Ford Model T: This site provides an explanation related to the history of the Ford Model T.
Interchangeable Parts: This site provides history and information related to interchangeable parts.
Assembly Line: This page provides an explanation of assembly lines.
Specialization: This EconEdLink detailed definition will help you understand.
Ransom Olds: This site discusses the first manufacturer to have used interchangeable parts and the assembly line in the U.S. auto industry.
Ford Assembly Line, 1920s: This site provides a video of an assembly line.
Interactive Activity: This EconEdLink quiz tests students' understanding of the Henry Ford lesson.
Productivity: This EconEdLink project asks students to create their own bookmark using an assembly line.
Antique Car Cut Out: This page provides a large number of antique cars that the students can cut out for their assembly line.
Bookmark Assembly Line: This page provides a diagram of how your book mark assembly line should look.
Assessment Rubric: This rubric can be used to grade students on their performance in the Henry Ford lesson.
Have the students work in teams of 2-3 at computers, reading the background information on Henry Ford and the Model T. In addition to using text, the students will use two brief video clips showing Model T production. The first clip shows the process in the early days when cars were assembled at workstations by a small group of workers. The second clip shows a moving assembly line. The students are provided the following text and hyperlinks.
The Early Days of Ford Motor Company and the Model T
When Henry Ford incorporated the Ford Motor Company in 1903, automobiles were expensive, custom-made machines purchased as a luxury item by the wealthy. Workers at the Ford factory in Detroit produced just a few cars a day.
Henry Ford's ambition was to make “a motor car for the great multitude.” He wanted to build a high-quality automobile that would be affordable to everyday people. He believed the way to do this was to manufacture one model in huge quantities.
Ford and his company ' s engineers designed a car named the Model T. First offered for sale in 1908, the Model T was produced like other cars—one vehicle at a time. But the Model T was more sturdy and powerful than other cars. Considered relatively simple to operate and maintain, the auto offered no factory options, not even a choice of color. The Model T was also less expensive than most other cars. At an initial price of $950, 10,000 autos were sold the first year—more than any other model.
|Vanadium Steel. Henry Ford searched the world for the best materials he could find at the cheapest cost. During a car race in Florida , he examined the wreckage of a French car and noticed that many of its parts were made of a metal that was lighter but stronger than what was being used in American cars. No one in the U.S. knew how to make this French steel—a vanadium alloy. As part of the preproduction process for the Model T, Ford imported an expert who helped him build a steel mill. As a result, the only cars in the world to utilize vanadium steel in the next five years would be French luxury cars and the Model T.|
The Moving Assembly Line
Like parts for other cars of the time, parts for the Model T were initially purchased made-to-order from other businesses. Teams of two or three skilled mechanics in the factory would gather these parts and put them together at a workstation, using everyday tools. When parts did not fit together as needed, workers would use files and hammers to make them fit.
Have your students take a peek at this process on the following video clip.
Henry Ford realized that a more efficient production process was needed to lower the price and meet increasing consumer demand for his popular new car. He needed to improve productivity—the amount of goods and services produced from a given amount of productive resources. Economists refer to goods and services as output. Henry Ford's output was the Model T. The productive resources used in production—natural resources, capital resources, and human capital—are inputs. Ford's inputs were the steel, workers, and other resources required to manufacture the car.
Ford looked at other industries and found strategies that he could apply to making the Model T. Take a look at Interchangeable Parts and the Assembly Line to learn more about two of the first strategies he adapted.
Using interchangeable parts required making the individual pieces of the car the same every time. All pieces would fit with all others. Any valve would fit any engine and any engine would fit any frame. The standardization of parts made it possible to break down assembly of the Model T into distinct steps. Each worker was trained to do just one step or a very few steps. Economists refer to this practice as specialization or the division of labor.
|Ransom Olds is the first manufacturer to have used interchangeable parts and the assembly line in the U.S. auto industry. He used these ideas in the production of the 1901 Curved Dash Oldsmobile, also referred to as the runabout.|
In 1913, the Ford Motor Company established the first moving assembly line ever used for large-scale manufacturing. On a trip to Chicago, Henry Ford observed meat packers removing cuts of beef from a carcass as it was passed along by a trolley until nothing was left. He was inspired to reverse the process for the production of his automobile.
Parts were attached to a moving Model T chassis in order, from axles at the beginning to bodies at the end of the line. As vehicles moved past the workers on the line, each worker would do one task. Some components took longer to put together and attach than others. Subassemblies were established for these. For example, each radiator with all its hose fittings was put together on a separate line feeding into the main assembly line. The interval between delivery of the car and its components was carefully timed to maintain a continuous flow.
Have your students view this video clip to see this moving assembly line in action. (After clicking on the link, scroll to the bottom of the page and click on "Ford Assembly Line, 1920s," below the car emblems.)
The home for this new production system was the Highland Park Plant near Detroit, Michigan which Ford opened in 1910. Assembly wound downward in the factory starting on the fourth floor where body panels were hammered out. On the third floor workers placed tires on wheels and painted auto bodies. After the assembly was completed on the second floor, the autos moved down a ramp past the first-floor offices. Test your comprehension of this lesson in the following activity.
When all the students have reported their bookmark production data and completed their worksheets, discuss the following as a class:
What inputs—or resources—did you use to produce your bookmarks? [ Capital resources listed on the worksheet were the card stock, pictures of the Model T, string, rulers, pencils, scissors, glue, hole punches, and markers. Students may also identify the desks and chairs used as their workstations. A human resource was the student labor. Natural resources include the trees used in the production of paper and pencils AND the metal used to manufacture scissors and hole punches.]
In the early days of Model T production, Henry Ford used a cottage industry approach, which consists of small teams of workers at workstations. How did the amount of time required for producing bookmarks in this way compare with production using specialization on the assembly line? [ Assembly line production generally reduces the amount of worker time required. HOWEVER, this may not be the case for all the assembly lines. Acknowledge that a poorly planned assembly line or a worker who experiences difficulties doing a specific task may cause a bottleneck and reduce productivity.]
Which assembly line tested by the class was most productive—in other words, which line made the most bookmarks?
Why did the assembly line produce more than the other lines? [ The line may have been more organized, group members may have worked harder or they may have been more skilled.]
Which group made the best-quality bookmarks? [ Potential responses are that they worked slower or had some workers who were very good at a particular task.]
What were the advantages of producing bookmarks using an assembly line in contrast to the cottage industry approach? [ Potential responses include more bookmarks could be produced, workers could be assigned tasks that they did best, all bookmarks looked the same, fewer capital resources were needed—for example, just one hole punch for an entire group versus one per team.]
- What were the disadvantages of producing bookmarks using an assembly line? [ Potential responses include the bookmarks all looked the same; it was boring doing the same task over and over; line workers are dependent on other workers—one worker can slow the whole process if he or she is slow or makes a mistake; some time must be invested at the start of the process planning how to operate the line.]
To help make the transition to Part 2, you may want to ask these additional questions:
While making your bookmarks, you were restricted with respect to the resources you could use. You were allowed to use only the items on your input list. What do you think would have happened if you had been allowed to use a paper cutter to cut the card stock? [ The job of one worker probably could have been eliminated and productivity would have increased.]
- Can you think of other capital investments that might improve and speed up productivity of the bookmarks? [ Potential answers include creating a template for where the hole should be punched, designing a machine that could punch several holes at the same time, and using a copy machine to reproduce the lettering.]
Tell the students that obtaining a paper cutter is an example of an investment in capital that can be used to increase productivity. In Part 2, they will explore the investments in capital that Henry Ford made to increase Model T productivity. They will also study how he addressed some of the problems that resulted from specialization.
As appropriate for your class, assign the students to do the following:
Draw the steps in the process for manufacturing a product you use. Label the various stages in the production process.
- Volunteer to collate materials or stuff envelopes for a community organization. Develop a plan to improve task productivity.
The students are provided instructions for producing bookmarks. They may print out copies of the worksheet from their computers, or you may prefer to print copies in advance and distribute them. Each student should have one copy of the worksheet.
Provide each team of 2-3 students with the following inputs when they are ready to begin bookmark production.
- Cardstock (tag board or recycled manila folders work well)
- 1 page with antique car clip art
- Ball of string or yarn
- 1 ruler
- 1 pencil
- 1 pair scissors
- 1 glue stick
- 1 hole punch
- 1 black marker
The handout directs the students to establish a workstation and produce one bookmark, using only the inputs listed on their handout. They are to work as a team of 2-3 craftspeople like the workers who first manufactured the Model T. As they complete their bookmarks, direct them to report the number of worker minutes required to produce each one. Explain that they can calculate this using the following formula.
(Number of workers x number of minutes assembly line operated)
Number of acceptable bookmarks
Write this data on the blackboard in a column labeled “Cottage Industry (Step 1)”.
To complete Step 2, student teams and their resources are combined to establish groups with a minimum of 9 people. Each group is directed to draft a flow chart illustrating an assembly line production process for the bookmarks. You may need to draw a simple flow chart on the board for students who are unfamiliar with this format.
NOTE: To enhance the technology aspects of this lesson, consider having students use word processing or other software to create their flow charts.
The students must test their strategy by operating an assembly line producing bookmarks. A 10-15 minute time frame for operation of the assembly line usually works well. Adjust the time as appropriate for your students; groups should have enough time to produce one bookmark for each worker.
Open this document to view one way the assembly line might be set up. Note that, with this group, the lettering required more time, so two people were assigned to the final task. Student assembly lines will vary with the number of students on each line and their skill levels.
If you have more students in some groups than are required for the assembly line, have them function as time managers and quality inspectors. Time managers are responsible for monitoring production time and recording data on the board. Inspectors look for production problems such as inaccurate measurements and sloppiness that may result in some bookmarks being rejected. As the teacher, you decide which bookmarks are of acceptable quality to be included in the productivity calculations.
The students again must calculate the units of input (worker minutes) per unit of output (bookmarks). Provide help as needed for this calculation. To avoid skewing the data, DO NOT INCLUDE the minutes of time managers and quality inspectors. Record the amount of time per bookmark on the board in a column labeled Assembly Line Workers (Step 2).
Evaluate each student's work based on his or her contribution to the assembly line, completion of the worksheet, and class discussion. Adjust and weight this assessment rubric to fit your needs throughout this three-part unit.