Monday, August 10, 2009

Rally ‘Round the Core: a Book Review of “Built to Last”

The title of the business book “Built to Last” conjures up images of marble statues or empire-building and that’s exactly what the authors were trying to infer, but with an unexpected twist. In their bestselling book, professors Jim Collins and Jerry Porras wanted to figure out what factors differentiate so-called visionary companies from the rest of the crowd. But what are visionary companies in the first place?

As Porras and Collins describe them, “visionary companies are the premier institutions – the crown jewels—in their industries, widely admired by their peers and having a long track record of making a significant impact on the world around them” (p. 1). So what separates great companies like 3M, Hewlett-Packard, or Sony, from the rest? As Collins and Porras found out, the answer to the question was counterintuitive.

The authors spent six years researching and comparing the practices of eighteen visionary companies to those of a matched set of good, though not great, companies. Using the research equivalent of “genetic twin studies,” their fundamental observation was that average companies are driven by the power of "or." For instance, you can have either short term profits or long term growth; either stability or progress. Visionary companies, in contrast, embrace the power of "and," i.e., you preserve the core and stimulate progress.

To make sure their conclusions were well received, the authors methodically explained how great companies build foundations that embrace seemingly contradictory goals. The great companies the authors studied, contrary to conventional wisdom, are not profit focused at their core but rather, they are “value” focused. These values are a sort of heart, around which leaders grow the company. Great companies such as Disney, Wal-Mart, Merck, Ford, Hewlett Packard, 3M, and Johnson and Johnson all exuded this yielding to foundational doctrine.

Among the core myths that Collins and Porras shattered are that visionary companies must start with a great product and be pushed into the future by a charismatic leader. Instead the majority of visionary companies were characterized by a total lack of an initial business plan or key idea and by remarkably self-effacing leaders. Along with that, great companies foster an almost cult-like devotion to a "core ideology" or identity, and active indoctrination of employees into "ideological commitment" to the company (e.g., Nordstrom’s). Workers who do not mesh with the company will definitely not fit and be “ejected like a virus” according to the authors.

When it comes to organizational development, Collins and Porras’ insights are invaluable. For an OD consultant, all well-researched knowledge is power and the authors provide key guidelines for working with specific companies.

Focused on planned change, the practice of organizational development seeks to help organizations achieve greater effectiveness. If a consultant understands the core ideology of a business, then he or she is more readily equipped to speak the language of the company. In some ways, this makes working with a visionary company either very easy or incredibly difficult.

Consultants who know themselves well would have to turn down certain jobs if they realized their personality would not mix with the doctrine of the company they are trying to serve. Again, since this is usually spelled out in visionary companies, it would be easy to accept or reject an offer once the consultant knows the limitations and strengths of his or her personality when compared with those of the company values.

As a detailed, conceptual framework, I thoroughly enjoyed reading and digesting “Built to Last.” I mostly took to heart the notion of starting a business as a way to grow within a productive community and as a way to provide for our substantive needs. As a future OD practitioner, I would highly recommend this work to any consultant or business leader.

However, what is unfortunate about the book is that it does not leave much room for companies which are already founded. It would seem that to truly build a long-standing and exceptional corporation, you would have to pretty much start over and found a new company. What happens to companies which were poorly founded or recently lost their charismatic leader? It would seem, and is probably the case that these companies will flounder and eventually pass on.

Another interesting insight from “Built to Last” is using core ideology as a litmus test to figure out if employees truly understand their company and its core values. Simply, if you ask them and they know, then it’s safe to say the company they work for is a good fit. People at 3M, Nordstrom’s, Disney, and Merck would more than likely be able to expound on what their company believes. Others probably wouldn’t know and might not even care.

This type of knowledge, at least for me, is of great value. In one instant you would be able to judge whether or not the company, and its employees, were on a meaningful path or not. With this information, the path to helping guide a company into a longer future would be easier to discern.

In the end, “Built to Last” discovered some of the most important truths of the twentieth century corporation. This book will be utilized for decades to come, partly because the authors developed their strategy on the same principles as the visionary companies they studied. I personally appreciated the author’s due diligence and vested interest in the difference between average companies and those that change the world.

Wednesday, August 5, 2009

Changing the Nature of Work

After researching Carol Dweck’s work on entity versus incremental learning postures, you realize that a company-wide change could help productivity. The problem with people believing their intelligence and gifts are totally genetic (entity) means they give up easily if something is difficult (i.e., “I’m just not good at such-and-such.”). This is not what you need for effective, long-term, emotionally healthy employees. The problem is that to get people to adopt an incremental learning style is to teach them to accept failure. In American business culture, failure is swept under the rug, never to be talked about. But, to get your organization to see learning as a progression of hard work rather than something you’re born with will take a great effort. No one wants to admit failure. Still, the research supports this new attitude in spades, pointing out that motivation increases and people don’t beat themselves up any longer when they face setbacks (Aronson and Tavris, 2007).

Carol Dweck's research on entity and incremental learning styles would have a very thin chance of being adopted wholeheartedly in American culture if presented directly. We are too focused on sidestepping failure to ever attempt such a risky path as admitting our mistakes. For one thing, if everyone had not bought in to this new belief they could easily manipulate the system for their own good. For incremental learning and truly learning from our mistakes to work, everyone has to play.

If a small or medium-sized company tried out this learning posture and it worked, it would undoubtedly be a hit. Small and medium-sized companies are nimble enough to orchestrate the intricacies of a complex culture change. Imagine being in a place where you were allowed to admit your faults and as long as you corrected them, move forward without much hassle. That would coincide well with the literature and research proposed by Karl Weick (1984) on small wins.

To be proper though, for this style of organizational culture to be adopted properly, it would have to be an organization-wide effort. It would not work if this were just one department admitting their mistakes. The next guys over would likely cover up theirs and make the small minority of folks on the other side look really bad. But if this initiative came from the top and passed directly from the mouths of executives themselves, also admitting their own mistakes, this would free the entire organization.


Tavris, C. & Aronson, E. (2007). Mistakes were made (but not by me): why we justify foolish beliefs, bad decisions, and hurtful acts. New York: Harcourt Inc.

Koppes et al. (2007). Historical perspectives in industrial and organizational psychology. London: Lawrence Erlbaum Associates, Publishers.