Enterprise & Society

Once, long ago, I was teaching business and economic history at Rice University in Houston, Texas. Alas, my academic career was stalled in the early 1960s. A distinguished Yale professor had kept the revised manuscript of my dissertation sitting on his desk for a year without reading it or submitting a report to the press. Meanwhile, I had just learned that editors do not want to publish fifty-page academic articles. I was having a wonderful time teaching the talented students at Rice, but it was not at all clear that I was not soon going to be looking for a different job and maybe a different profession.

Fortunately, I had met Al Chandler while I was spending the academic year 1959–1960 on a postdoc—actually in my case an "almost postdoc" because I finished late—at the Harvard Business School (HBS). Never having taken a course in business history, economic history, economics, sociology, or political science, I badly needed that year to get an intellectual base in my new subdiscipline. At that time, Chandler was working on what would become his first major opus, Strategy and Structure. He took an interest in my work and a few years later after I rescued my manuscript and sent it to him, he in turn delivered it to the Johns Hopkins University Press (which decided to publish it) and rescued my career.

Chandler rescued many a historian in the years he spent at MIT, Johns Hopkins, and HBS. In my case, he next offered me a five-year [End Page 415] fellowship (1965–1970) under a grant he had received from the Sloan Foundation. I eagerly accepted an appointment that gave me a great deal of released time and an opportunity as a visiting assistant professor to become familiar with the faculty and the unique seminar system at Hopkins. My part of the deal was to become the Executive Officer to Captain Chandler. As Exec, I happily taught his undergraduate courses, took part in numerous PhD exams—in effect, standing in for Chandler—and edited whatever Al was writing at that time. And he was always writing. We had a close working relationship that was personal as well as professional. I got to know his wonderful family, including his talented wife Fay, whose art still adorns the walls of my living room. I also came to know most of Chandler's graduate students, including Mary Yeager, Harold Livesay, Bill Becker, and Ed Perkins, among others.

In the academic year 1969–1970, I left Hopkins and Rice and moved to Rutgers University, where I taught at Livingston College, the only US state-subsidized revolutionary movement with which I am familiar. Since Chandler was visiting HBS that year, I continued to go to Baltimore once a week to teach his Hopkins course in economic and business history. As I could see, Al's little herd of graduate students was nervous about him leaving them behind. They felt adrift, so I organized the only Hopkins graduate seminar that has, I believe, ever been held in the bar at the Pennsylvania Railroad station. After Al left Hopkins to take the chair in business history at HBS (1970), I took over his two jobs in Baltimore: editing the papers of Dwight David Eisenhower; and teaching and directing undergraduate and graduate work in business and economic history. As should be obvious, I am thus deeply indebted to Al Chandler, compromised as a critic of his scholarship, and influenced dramatically by his contributions to the history of modern business.

I simply accepted the bulk of the Chandler paradigm, in particular his ideas about the central role of big businesses like Standard Oil (now Exxon), Du Pont, and General Motors in driving America's economic growth during the second industrial revolution. From the late nineteenth century through the middle of the twentieth, firms like these combined mass-production with mass-distribution in the world's largest industrial economy. Nothing that his critics have said in recent years has persuaded me that Al Chandler was wrong about those developments: about the accomplishments and subsequent problems of the U-Form of centralized enterprise; about the success of the M-Form of multidivisional, diversified corporation; about the advantages first-movers had in defending their markets; and about the strategies of the world's most successful giant enterprises of [End Page 416] that era. These are the foundation stones of the Chandler legacy and they have been neither chipped nor overturned by recent scholarship.

Instead of trying to debunk Al Chandler's paradigm, I was building on it, broadening it, and finding ways to improve it. For one thing, I wanted to help historians understand the political roles giant enterprises had played in America—a subject that did not interest Chandler. Believing, with Lord Acton, that power corrupts, I looked for corruption and was not disappointed. I had a particular interest in antitrust policy, a subject on which I have continued to write to the present day. Giant firms like Standard Oil were, as Chandler maintained, very efficient producers, but they also engaged in secret, anticompetitive practices; they were also happy to corrupt politicians as long as they could get away with it. I wanted those practices and the politics of political economy to be included in business history. Gradually, I began to look beyond the United States, exploring the differing approaches to competition and cooperation in Europe and Asia, and this too helped me broaden Chandler's version of business history.

Being serious about Chandler's work, I had from the early days of our collaboration begun to delve into the two bodies of theory most important to his development as a scholar. I spent weeks wading through the abstract sociology of Talcott Parsons and the work of Max Weber, both of whom had provided Chandler with essential concepts that I found useful in my own work. The publications of Joseph A. Schumpeter were also crucial to Al, who wove entrepreneurship into all of his books and articles. From that point on, I set out to explore entrepreneurial relationships in depth, focusing on the political setting and the important nonprofit sector, as well as business in the United States and abroad. Like Chandler, I discovered that bureaucracy and innovation were not incompatible, but unlike Al, I frequently found that the sources of innovation were in the business environment, in the sciences and technologies that became crucial to entrepreneurship in the twentieth century (and still are today).

After I replaced Chandler at Johns Hopkins, I also pushed ahead with three academic projects I had inherited from him: I completed (with a great deal of help) the editing of The Papers of Dwight David Eisenhower; I conducted a vigorous graduate program that helped populate a new generation of amazingly productive business, economic, and political historians (all of whom started their graduate work by mastering Chandler's synthesis); meanwhile, I pushed ever deeper into the historical context in which modern business functioned and began to probe very seriously the sources of innovation in science-based industries during the twentieth and twenty-first centuries. [End Page 417]

My work on telecommunications and the pharmaceutical industry gave me a greater appreciation of the tensions that existed within large organizations and between those institutions and their social and political settings. At AT&T, I found a rich source of information on the important role systematic innovation could play in protecting the political and economic status of a regulated monopoly. The theory of the firm could not help me understand those relationships, but a broadly based history of that remarkable institution could. In my work on pharmaceuticals, I was able to study the professional and political networks that fostered innovation in this and other high-tech industries; this scholarly adventure carried me into the very heart of the firm and convinced me that we still needed to learn a great deal more about entrepreneurship in global business. In a series of books, articles, reviews, and papers, I traced and analyzed the cycles of innovation that have characterized global pharmaceuticals from the late nineteenth century to the present day. This work persuaded me that historians of business were poorly equipped to understand the enterprises of the third industrial revolution, the Information Age, because of their poor understanding of the basic sciences and technologies that were essential to those industries.

Today, my teaching, my editing, and my research and writing all have a global perspective, even when the ostensible subject is something that happened in the United States. I find more variety in global business than Chandler did. As I worked my way deeply into the information age, I could see that the business world of the second industrial revolution—Chandler's central concern—was beginning to crumble. New structures and new strategies were emerging, driven by globalization as well as scientific and technological change. To some observers and many participants these developments seem threatening, seem to be a gathering storm. But like Alfred D. Chandler, Jr., I am still optimistic about democratic capitalism and about the ability of American enterprise to cope with the challenges and opportunities of the twenty-first century. [End Page 418]