Economy

How Robert McNamara And The Whiz Kids Invented Big Data

History mostly knows him as the disgraced architect of the Vietnam War, but McNamara first made his mark in the corporate world with his mastery of numbers before it was as fashionable as it is today.

Robert McNamara in 1966
Robert McNamara in 1966
Tristan Gaston-Breton

PARIS â€" Robert McNamara was a life-long manager who showed remarkably little interest in people. Those who knew him well described the California native as cold and distant â€" and he was never taken by the pursuit of material things either. For this onetime top Ford Motors executive, cars were nothing more than a method of transport.

McNamara was drawn, instead, to numbers. He was able to maximize company profits because he knew markets intimately. He could build an efficient organization based on data alone.

The son of a wholesale shoe retailer, McNamara developed a passion for numbers at age 23 when he was admitted to Harvard for an MBA in 1939. McNamara had already graduated in mathematics from Berkeley. The atmosphere at Harvard in Cambridge, Massachusetts, was very different from the one he'd experienced back in California. A new subject was introduced at Harvard that revolutionized the curriculum at the time â€" financial planning. The school believed this subject could turn MBA students into generalists who could succeed in any sector, marking a turning point in management training.

After he received his degree, McNamara became Harvard's youngest management professor in 1940. But he didn’t stay a professor for long.

In May 1942, a senior administration official, Charles Bates Thornton, paid McNamara a visit. The Japanese had attacked Pearl Harbor a few months earlier. Thornton, an assistant to the deputy secretary of defense, had a mission. He was charged with building a department of statistical control that could collect data on aerial warfare in Europe and the Pacific. Thornton needed to find scenarios where the Air Force could intervene and submit those ideas to the military chief of staff. For this, he needed a formation program in statistical analysis for his team. Thornton believed McNamara was the person for it.

McNamara joined him and worked on that project for a year. Thornton promoted him to the rank of a captain in the Air Force.

In his office in Washington DC, McNamara dealt with thousands of numbers to maximize air operations: flight frequency, fuel consumption, crew turnover, loss ratio, number of bombs jettisoned, percentage of target destruction. He drew up the most efficient travel plan for air raids in Japan based on analysis of B-29 heavy bomber’s fuel consumption between India and China.

McNamara was also responsible for the strategy to replace high-altitude bombings on military targets with low-altitude bombings on Japanese cities. The military took the decision after his statistical studies took into account the percentage of wooden homes, the civilian casualty ratio and their impact on the population's morale.

It wasn’t surprising that Thornton, McNamara and eight others from the statistical control team were called the Whiz Kids.

After the war, the Whiz Kids considered their future. The money wasn't great in the army â€" one of the reasons they didn’t want to continue in the military. That's when Thornton stumbled upon an article in Life magazine about the difficulties faced by automaker Ford. Days later, the Whiz Kids offered their services to Henry Ford II, who had just taken over the company. "We can save your company," they told him in a letter. In 1946, they were all hired.

The idea the team offered was simple â€" what you do matters less than how you do it. The Whiz Kids, under the leadership of Ernest Breech, reorganized production lines to bring down costs. They set up a cash-flow management system and a dashboard that could analyze all costs involved in making a car. This allowed them to plan the most cost-effective manufacture of a car.

In two years, Ford was making money again. Thornton left the company in 1948, making McNamara the group leader and one of the company's most influential men. McNamara’s beliefs surprised colleagues at Ford. He wasn't interested in issues of quality. Armed with statistics and data, he won every argument. Such methods were a novelty at the time and proved to be impressively efficient.

In 1958, he played a key role in the launch of the second-generation Thunderbird, a new four-seater model that was tweaked from the original. In Detroit, where the car was being manufactured, nobody believed it could work in the market. But McNamara was convinced there was a niche for a comfortable and spacious car aimed at young couples with children. His conviction was based on statistical analyzes of not only the living standards and consumption habits of this consumer base but also on the car’s cost per unit and the way the automobile industry was organized at the time.

While Henry Ford II suggested creating an entirely new model for the market sector, McNamara responded that it would be a lot simpler and less expensive to modify an existing model. Not only would modifications of resource allocations be marginal, the model would not need a dedicated sales network and scores of engineers.

The Thunderbird was re-launched to great success.

But that wasn’t McNamara’s biggest feat. He made data calculations that showed there was room on the U.S. market for a compact, fuel-efficient automobile that didn’t have unnecessary options. This was sacrilege in the U.S. Manufacturers only produced large cars back then.

McNamara's reasoning was simple. A compact car would be inexpensive to build and could sell in large numbers since it didn't require huge industrial investment. Consumers, too, were tightening their transportation budgets at the time. And that’s how the Ford Falcon was born in 1960. The model marked the peak of McNamara's data-driven approach. Ford sold 435,000 Falcon cars in its first year representing a quarter of the company’s total turnover.

On November 9, 1960, John F. Kennedy won the U.S. presidential election against Richard Nixon. On the same day, McNamara was named president of Ford, the first person to hold that position who wasn’t from the founding family. Eight weeks later, he resigned to join the Kennedy administration as secretary of defense where he would move on to his next challenge â€" managing American forces in Vietnam.

But by then, McNamara and the Whiz Kids had already made their mark. Financial planning and reporting became an essential part of doing business in companies around the world.

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Society

A Mother In Spain Denied Child Custody Because She Lives In Rural Area

A court in Spain usurps custody of the one-year-old boy living with his mother in the "deep" part of the Galicia region, forced to instead live with his father in the southern city of Marbella, which the judge says is "cosmopolitan" with good schools and medical care. Women's rights groups have taken up the mother's case.

A child in Galician countryside

Laure Gautherin

A Spanish court has ordered the withdrawal of a mother's custody of her one-year-old boy because she is living in the countryside in northwestern Spain, where the judge says the child won't have "opportunities for the proper development of his personality."

The case, reported Monday in La Voz de Galicia, has sparked outrage from a women's rights association but has also set off reactions from politicians of different stripes across the province of Galicia, defending the values of rural life.


Judge María Belén Ureña Carazo, of the family court of Marbella, a city on the southern coast of 141,000 people, has ordered the toddler to stay with father who lives in the city rather than with his mother because she was living in "deep Galicia" where the child would lack opportunities to "grow up in a happy environment."

Front page of La Voz de Galicia - October 25, 2021

Front page of La Voz de Galicia - Monday 25 October, 2021

La Voz de Galicia

Better in a "cosmopolitan" city?


The judge said Marbella, where the father lives, was a "cosmopolitan city" with "a good hospital" as well as "all kinds of schools" and thus provided a better environment for the child to thrive.

The mother has submitted a formal complaint to the General Council of the Judiciary that the family court magistrate had acted with "absolute contempt," her lawyer told La Voz de Galicia.

The mother quickly accumulated support from local politicians and civic organizations. The Clara Campoamor association described the judge's arguments as offensive, intolerable and typical of "an ignorant person who has not traveled much."

The Xunta de Galicia, the regional government, has addressed the case, saying that any place in Galicia meets the conditions to educate a minor. The Socialist party politician Pablo Arangüena tweeted that "it would not hurt part of the judiciary to spend a summer in Galicia."

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