Capital

Ford in 1903 had priced his Model A at USD 750. The capital he employed to make this came to about USD 30,000.

From 1903 to 1919, the Model A Ford was the largest selling car in the US.
Single colour, no new styles or changes for a period of 16 years.

In Galbraith's New Industrial Estate, he makes a very important report about the Ford Motor Company.
In 1903, the company was in a position to solicit a paid capital of USD 30,000, 125 people, and in 4 months they were able to come up with the Model A Ford.

In 1963, FMC to develop the Ford Mustang, had spent USD 59 million, taken 3 and a half years and had on its rooster 250,000 employees.

The moot point that Galbraith makes is, FMC took much less capital to get into business but required a much higher capital and technology to stay in business.

he makes 5 points which is an eyeopener for any entrepreneur.
1. The beginning of the work to the market in 1903 took just 4 months. In 1963, a mere change in model took 40 months.

2. a vast increase in capital, which warrants study if the product demanded it or just the ego to stay in business or just the cost to erect barriers of entry for competition. Anyway, the customer was much happy to bear these costs.
the investment per unit of output in 1903 was infinitesimal vis a vis the investment per unit output in 1963.

3. An increase in inflexibility. only elementary machines were used initially, no special machineries. Any change in 1903 could have been accommodated in a few hours.
If they tried to change even one screw in 1963, it would take many months.

4. Specialized manpower. Necessitating specialized planning in the future to the utmost detail. Increasing complexities in the business and production.

5. A tall organizational structure from a relatively flat structure, each employee would be on a very specific task or role.(Adam Smith - Division of labour)
Employees cannot do any task in the organization but a specific one in the complicated whole .