If ever there was a competition to determine the bible of the business world, “Built to Last” by Jim Collins and Jerry Porras would be one of the finalists. It is a timeless epic constructed around nearly a decade of research into how visionary companies separate themselves from regular companies in order to achieve sustained success for at least 50 years. After speaking with a wide variety of business leaders, CEOs, and experts, Collins & Porras identified 18 visionary companies that had the best reputation in multiple dimensions, from being revered as a place to work, developing managerial talent internally, and for consistently building values for their shareholders. Each of these companies represents a different industry like pharmaceuticals, retail, fast moving consumer goods, and technology. Perhaps the most astounding fact about this book is that it was published over 20 years ago.
Go back 20 years and there were only the first, experimental traces of the consumer internet. There was no social media, no blogging platforms. The consumption of media had not shifted towards mobile devices since it would be nearly 10 years until the iPhone came out. For those young entrepreneurs out there who don’t remember the early 90’s, it would be easy to dismiss “Built to Last” as outdated. But the entire point of the book is to find the things that remain steady and consistent during periods of vast change, the internet revolution being no different.
The companies profiled are 3M, Sony, HP, Boeing, Motorola, Wal-Mart, Disney, Nordstrom’s, Marriott, American Express, Citigroup, IBM, Johnson & Johnson, Philip Morris, Ford, General Electric, and Proctor & Gamble. Each of those companies is paired with a comparison company from the same industry, a similar company that had the same potential but didn’t end up becoming considered as a visionary company for a stack of different reasons.
“Built to Last” could really be seen as the ultimate guide book to the 18 visionary companies studied. Through deft storytelling, extensive qualitative research, and clarifying comparisons Collins & Porras dial in on all of the things that these companies do differently and what strengths are drawn from these tactics.
The yin and the yang
Their underlying point is the balance between Preserving the Core and Stimulating Change, which they symbolize through the use of the Chinese ying-yang. Visionary companies are able to stay visionary and very successful because they successfully create a core, supported by values and tenants. Around the core, change is stimulated and encouraged through competitive rewards programs, research experimentation, and enabling autonomy.
These ideas might seem to contradict each other, after all, how can you have change and the status quo at the same time? But the authors point out the “Genius of AND versus the Tyranny of OR.” Great leaders and great companies have found ways to do both: they have found ways to identify what is sacred, versus what can be changed. Using the “Genius of AND,” the visionary companies have navigated evolving business climates, external forces, and fierce competition by isolating new opportunities and expanding into new industries while keeping the same personality and philosophy.
Since the book did originally come out in 1994, some of the 18 visionary companies have succumbed to the forces of the market. Motorola was bought by Google. Philip Morris became Altria. But the 16 others are going strong today, and many have been for 150 years. That’s the big reason why anyone interested in business should read this book. Entrepreneurs benefit from learning about the best practices and mistakes that have proven vital to determining success. Managers learn about nurturing corporate culture and motivating employees to new levels of achievement. CEOs take away crucial lessons about internal training, transitions, and why the greatest leaders in the history of business did what they did.