Alfred P. Sloan the Architect of American Business

Nov 17, 20222 min read

Updated: Nov 18, 2022

Alfred P. Sloan was born to a machinist turned small-business owner in New Haven, Connecticut, on May 23, 1875. Sloan, at a young age with tireless effort, entered MIT early, graduating in just three years as the youngest member of his class. Through self-training, he became an electrical engineer and began a career that lasted seven years as a draftsman for the Hyatt Roller Bearing Company. In the late 1890s, this company manufactured roller bearings (a component of car transmissions). It sold its products to some of the biggest car manufacturers in the United States (i.e., Ford Motor Company and General Motors). After acquiring majority ownership of Hyatt roller bearings, he sold his company to United Motors, which General Motors later bought. Following this merger, in 1918, he joined General Motors and began his journey in building the largest, most innovative, and probably the most important company in the world that transformed the twentieth century. Alfred Sloan dealt with a company with only a 12.7 percent market share compared to its biggest competitor, Ford, who had 55 percent. During the early stages of General Motors, he dealt with America’s greatest industrialist who was at the top of his game (Ford Model T was the most popular car currently in the market).

And on top of that, the automobile industry was highly fluid and hypercompetitive. By 1929, Sloan and GM sold 4.6 million vehicles with a market share of 32.3 percent topping Ford’s 31.3 percent. General Motors then held 1956 52 percent market share and was one of the world’s most profitable, admired, and best-run companies. When Sloan retired as chairman in 1956, he was credited with saving General Motors and being the father of the modern corporation, an intellectual of consumer marketing, and the most influential CEO in history.

List of accomplishments

Created effective public relations
Implemented long-term forecasting (planning for the future)
Hired professional designers, spearheading GM’s parade of annual car models
Funded a series of technological advancements and inspired long-term research and development
He encouraged his friend, Walter P. Chrysler, to launch his own company, which became the Chrysler Corporation.
1. Alfred Sloan did this regardless of General Motors's market power because he believed that the automobile industry needed a strong competitor.
His most important innovation was the practical organization of a complex institution.
1. He centralized the administration of General Motors with decentralized operations.
2. He segmented consumer brands to create endless demand.