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.


  1. Jeff,

    Great insights!! If only companies would follow and stick to its core values, the rest will come. Thinking adn acting short term only never goes far and you will be caught. Thinking long term only never gets there and the interest goes need to do both and make it a the fabric of your organization. Do teh "right " thing, and they (customers, stack holders and employees) will come.


  2. Thank you! I'm happy that this post struck a chord with you. I think Collins and Porras were onto something, however, some of the companies they named are now going down the tubes, like Nordstrom. Still, they could bounce back.