Orrin Woodward on LIFE & Leadership

I have read thousands of books on successful people, on achievers with drive and tenacity, but one of my favorite entrepreneurs was a young man who grew up in Flint Michigan, by the name of William Durant. Billy Durant, the founder of, not only General Motors (GM), but also Buick and Chevrolet, was a classic case of serial entrepreneurship.  In my opinion, no life story represents the “can do” spirit of Free Enterprise any better than Durant’s, displaying the hopes and fears of the American Dream in all its glory.  His vision allowed him to bounce back after multiple setbacks, setbacks that would have demoralized a lesser person. Starting with nothing but vision and drive, Durant foresaw a world-wide automotive empire, founding Buick, Chevrolet, and Durant Motors, along with the automotive icon, GM.  Sadly, his story doesn’t have a happy ending financially, being forced to sell out his interest in GM to the Wall Street bankers in the early 1920’s; he lost his remaining fortune during the 1929 stock market crash, leaving him near penniless despite his creative genius. A key principle of life is to learn from both great successes and great failures, since many times, failure reveals the lessons better than success can. Being inspired by his dreams, humbled by his setbacks, and educated by his entrepreneurship, I have studied Durant’s life extensively, believing that Durant represents the power of vision better than any other entrepreneur.  It takes vision to sell the future, and Durant, many times, sold his vision without the benefit of money to back it up.  His life exemplifies the power of vision to create tomorrow’s reality.

I have read thousands of books on successful people, on achievers with drive and tenacity, but one of my favorite entrepreneurs was a young man who grew up in FlintDurant, in fact, actually lost GM twice during his entrepreneurial journeys.  The first time,  having built Buick into a major brand name and selling more cars than any other manufacturer, he pursued his brainchild of forming a trust to hold multiple car manufacturers into the formation of GM.  Taking the profits from Buick, he purchased Pontiac, Oldsmobile, and Cadillac, to name just a few of the successful manufacturers forming the nucleus of GM.  Over the next several years, Durant expanded his empire by selling the vision of GM to other automobiles manufacturers, offering to buy the companies in return for GM stock.  Several times, surprisingly, Durant nearly bought out Henry Ford by offering GM stock in return for bringing Ford Motors into the GM trust, but Ford demanded cash, not GM stock, in order to close the deal.  Henry Ford, not once, but twice agreed to terms to sell Ford to GM, ultimately, only maintaining ownership in Ford Motors because Durant missed raising the necessary cash by the time deadline, once by less than twenty-four hours.  The true Titan of the automobile industry, the true visionary that saw the automobiles meteoric future was the man from Flint, Michigan named Billy Durant, not Henry Ford as we typically learn in the history books.  Can you imagine the history of automobiles had Durant raised the money in time to bring Ford Motors into the GM fold?

As normally the case with huge leaders, Durant’s vision surpassed his financing. Early in the second decade of the twentieth century, during an economic downturn, the car market stalled, tightening cash flows throughout GM divisions. Durant ran out of money, having used all of his and his friends money reserves, forcing him to sell GM to a committee of bankers happy to buy GM at a bargain basement price.  For the majority of people, people without vision, a setback of this magnitude would have knocked them out, but Durant’s vision carried him forward, undaunted by his “failure.”  Acting quickly,  he started another manufacturer, teaming up with a little known (at the time) racer and mechanic by the name of Louis Chevrolet.  With Durant’s business savvy, Chevrolet zoomed to the top quickly, selling cars so fast that it became one of the top manufacturers, even surpassing many of the GM brands.  Meanwhile, the non-visionary group of bankers managing GM, risked little of their precious capital, playing it safe with the new automotive field.  The bankers were no match for the vision and drive of Durant; even though the bankers had plenty of money, they lacked the one irreplaceable factor – vision.  Parlaying his success at Chevrolet, Durant started swapping Chevrolet stock for GM stock with the intention of buying enough stock to wrest control of GM back from the ultra conservative bankers.  In 1916, Durant achieved his goal.  Walking into a GM board meeting, in front of the bankers who had bought his former company, Durant announced that he was now the majority shareholder of GM, proclaiming his desire merge GM with Chevrolet.  One can only imagine the shock and dismay when the bankers realized they had been outwitted by the local business man with world sized vision.  This is a testament to the power of vision as Durant rebounded from an ignominious defeat, having to sell GM to the bankers and turned it into glorious victory by building Chevrolet into a dynasty, buying back controlling interest in his beloved GM through Chevrolet’s success.  Durant refused to surrender his vision of the future for GM, regardless of the odds against him, displaying the power of vision to surmount any obstacles in one’s life.

Durant also developed the unique structure of GM, including centralized administration at GM corporate, but decentralized operations in the various companies under flying under the GM banner.  Understanding that talented people were essential to the success of GM, Durant, with his magnetic vision, drew strong leaders into the GM orbit.  Nearly all the top automotive men of the time either worked for GM, or like Ford, nearly did. In fact, Walter Chrysler, later the founder Chrysler Motors, worked for Durant for many years as the headman of Buick Motors, being paid over $100,000 per year to do so.  Other recognizable top names who worked with Durant were Charles Kettering, Alfred Sloan, along with many other less recognized notables. Durant’s strong vision attracted other visionaries, drawing many talented people into the automotive field and the opportunities arising throughout GM.  His vision included the strategy of selling cars to fit the customer’s budget.  From low end vehicles for first time buyers to luxury vehicles for the wealthier patrons, GM offered products for every customer’s financial situation, with the goal of becoming a one stop shop for automobiles for every customer.

Durant’s successful takeover of GM, however, did not go unnoticed by the Wall Street bankers.  The bankers were not happy that an upstart businessman had outfoxed them for control of GM, and subsequently, developed a comeback strategy of their own.  Selling millions of vehicles and expanding his company across the globe was Durant’s major objectives, but the bankers had another goal in mind for GM.  Knowing Durant’s loyalty to his business partners, partners who had helped him fund Chevrolet and the GM takeover, the bankers began a covert operation to reduce the GM stock price.  Even though GM was profitable, the stock price began to tumble as the bankers flooded the market with GM stock.  Durant, always loyal to his friends, literally purchased millions of dollars of GM stock, not because he needed more stock, but in an attempt to support the stock price, protecting his friends and fellow GM investors from financial harm.  The Wall Street bankers, knowing Durant’s loyalty to his fellow investors would play right into their hands, calmly drove the stock price down until Durant ran out of personal funds. Having over ten million of his own dollars invested (a huge sum even in todays inflated dollars), Durant was at the brink of bankruptcy.   Finally crying ‘Uncle”, Durant was forced to sell on the cheap to a syndicate consisting of J. P. Morgan, the Dupont family, John Raskob, along with other Wall Street bankers.  Durant was booted out of GM for the second time, receiving only nickels on the dollar in real value.  His failure was not a failure in business strategy, but a failure to conceive of the level of animosity generated by a successful entrepreneur bid to maintain control of his own company against the financial powers aligned against him.  Most people would have surrendered their dreams at this point, becoming bitter at the injustices received, but Durant was not like most people.  Instead of wallowing in his misery, having a pity party at his own expense, he quickly started a third automobile manufacturer, know simply as Durant Motors, creating his third successful brand in less than twenty-five years.  But as fate would have it, in 1929, he lost his remaining millions in the stock market crash leading into America’s Great Depression. Durant was left with no money, no company, and few prospects for the future, having reached retirement age financially insolvent.

Is it possible to endure a setback of this magnitude and get up again?  With a strong vision, a strong character and a never say die attitude, one can endure practically anything.  Clearly, to evaluate Durant honestly, as no one is perfect, one must agree that Durant would have benefitted from a more conservative friend to help ‘reality check’  some of Durant’s visions.  A good example that would have helped Durant is the the role that the conservative Bud Walton, Sam Walton’s brother, played for visionary founder of Wal-Mart.  With that said, , no one can discount the strength of Durant’s vision to overcome nearly any setback.  Perhaps Durant should have played it safe after going from broke to millionaire three times in his life, but that just wasn’t the way he played the game.  In his seventies and eighties, at a time when most people are settling down into retirement, Durant was hard at work again in two new fields.  In the late 1930‘s, he saw a bright future, this time in bowling alleys and fast food restaurants, serving the thriving suburbs created by mass use of automobiles.  It’s hard to imagine the entrepreneurial spirit inside of Durant, recognizing the upcoming fast food revolution over a decade before Ray Kroc of McDonald’s fame.  Only Durant’s failing health and eventual death in the mid 1940‘s ended his vision. By reading the life  and times of men and women like Durant, one can quickly see the difference that vision has in one’s life, creating the enthusiasm and staying power to endure and fulfill a dream.

There are many lessons to learn from Durant’s life, but let me share just a few.  First, he didn’t have the perfect upbringing, his dad leaving his mother when he was young, being raised by his mom on a minimal budget.  Durant knew that if he was going to make his dreams a reality, it would be from his own efforts and leadership, not from gifts of a rich dad or family.  Not only was he up to the task, but the challenge fired him with enthusiasm to do something great, ultimately creating the largest car company in the world for nearly a century.  Durant understood that it isn’t where you start in life, but how far you go that counts. It didn’t matter if he had to borrow money from a local Flint bank to get started in the horse carriage industry; it didn’t matter if he had to ditch the horse carriage business when automobiles were invented; it’s didn’t matter if he failed as long as his vision didn’t fail him.  It’s vision, not money, that is the true delineator in the quest for success.  Billy Durant’s life teaches us to never let lack of resources stop us from chasing our dreams.

Second, Durant saw a bright future for automobiles, seeing it earlier than others, dropping his carriage business to put all his energies into cars.  As early as 1910, long before most even had a car, he spoke of every household owning a car with road criss-crossing America, dreaming of super highways connecting each big city, providing better travel for all Americans.  This vision compelled him to work in the present to create the future.  Long before the founders of both Ford Motors and Chrysler Motors – Henry Ford and Walter Chrysler; Billy Durant led the field for the burgeoning automobile industry.  Many people have forgotten the name William Durant, replacing him with the legends of Henry Ford, Walter Chrysler, and Albert Sloan, but all of these great leaders merely followed the vision casts by the Titan of automobiles, Billy Durant.  Vision is the key to separate your current reality from your future dreams.  A young man, whose only asset was the power of his vision, accomplished greatness in a new field, symbolizing the dream available to all Americans with vision.  I encourage you to read the biographies of Billy Durant. Here is a superb summary by Clarence Young, a historian of the automobile industry, from the book by Lawrence R. Gustin on Billy Durant.  God Bless, Orrin Woodward

In the creation of the Mass
Production Age, Durant was not only the presiding genius; he was,
indeed, the Titan—and, as was the fate of the original Titans, he was
destroyed by the Olympians whom he had created.

 

It is almost poignant now to
tell the beads of carping criticism reiterated against Durant: He lacked
or ignored technical mastery . . . . . he was a good promoter, but no
administrator. . . .He had no organization. . . . He could not delegate
authority. . . . He made poor choices of executives. . . . He was a
promoter, a gambler. . . . He was wrong in believing in himself. . . .

 

It is completely true that W.
C. Durant had a weakness: He was human.  His humanity included love and
trust of his associates—the not-always-correct assumption that they were
as honorable as he.  He gave a degree and quality of loyalty to “his
people” beyond any measurement; he expected the same magnitude of
loyalty from them.

 

He surrendered the control of
General Motors in 1910 to preserve the company for its investors.  In
1920, his loyalty to his company and its stockholders drove him to spend
more money than he had preserving the value of the company’s name,
reputation, and stock.  As for his feckless choice of executives, he
hired and developed Charles W. Nash, Charles F. Kettering, Alfred P.
Sloan, (also Walter Chrysler and almost Henry Ford) and a few thousand others.

 

What was Durant? . . . . A
small-town boy from a broken home who had no advantages at all except
his own character.  With a borrowed $2000 he built up the largest
carriage company in the world.  With a debt-ridden, faltering motor
company, he created the world’s largest corporation, providing millions
of jobs all over the world in the past 65 years. (Over a 100 years now)

 

Small in stature, W. C. Durant
was larger than life in every aspect of his thought, spirit, and
practice.  He was, indeed, so much larger in concept that he made the
lesser men who surrounded him uncomfortable—he was unpredictable as an
elemental force of nature.

 

Durant was an original genius
who escapes classification and definition; he had an almost godlike
prescience; he had the creativity to translate his vision to reality,
not only for himself but for his fellow men.  He was compassionate,
gentle, charming, delightful, considerate, brilliant, generous,
ingenious, and infinitely loyal.

 

Mass production—the greatest
servant ever tamed to the uses of mankind—was still only an idea when
Durant grasped it.  He more than any other man, implemented this great
multiplier of goods and good for mankind.  He was, indeed, what Dickens
called, “The Founder of the Feast”—and we are still eating at his
bountiful table, although we have forgotten his name.