Main Theme: Leadership, Habits, Vision
For People Who: Want to Build Organizations that Outlast Them
I am a big Jim Collins fan and have now read the books he’s authored/coauthored in reverse of their publication date. What makes the ideas of Built to Last and his other works so potent is they are not merely his opinions. Each book is steeped in years of data collection and study. So the theories promoted in Built to Last, Good to Great, How The Mighty Fall, and Great by Choice are not mere opinion, they are grounded in factual history. This is why I find his (and his coauthor’s) writings on leadership and organization culture so compelling! Built to Last is essentially about how great visionary companies outpaced their competitors and have existed over 100 years! As leaders, do we not want our work to live far beyond us? As leaders, we believe the work we do changes the world. And may we never be satisfied as leaders until the organizations we have built can continue to succeed long after we have walked away from them.
Built to Last is about building something worthy of lasting…Implicit throughout every page of Built to Lastis a simple question: Why on Earth would you settle for creating something mediocre that does little more than make money, when you can create something outstanding that makes a lasting contribution as well? -Built to Last, pg. xiii
- Whether you’re a non-profit (like a church) or a for-profit business, the principles of leadership and organization apply across the board. Both face the need for great leaders, both must change how they operate with the change of culture, both face the need to preserve their core values while progressing toward big goals – the list goes on! While some pastors may feel it unnecessary to grow as leaders, they do so to the detriment of their people.
- Believing you need to be a charismatic leader or have some great idea to be successful is a myth. The leaders of the visionary companies in Built to Last were usually quiet, meek and mild – though passionate and driven!
- You can help someone by telling them what time it is, but you can impact them more by building them a clock! That is what great leaders of visionary companies do – they build clocks. The greatest thing they leave behind is not an empty space where they used to stand, but an incredible organization that runs without them.
- Your core ideology (core values) provide the purpose for, and shape the focus, of your organization. If you don’t know what your organization stands for you’ll never know what decisions to make.
- BHAGs, or Big Hair Audacious Goals, borderline on insanity. They push your prudence and rationality. But they also produce momentum, need no defending, and drive your organization’s progress! (What a great chapter!)
Chapter 1: The Best of the Best
Collins & Porras open up Built to Last by discussing the companies they studied and the difference between the “Visionary Companies” and the “Comparison Companies.” They bring out the big guns immediately by shattering twelve myths of visionary organizations:
- Myth 1: It takes a great idea to start a great company
- Myth 2: Visionary companies require great and charismatic visionary leaders
- Myth 3: The most successful companies exist first and foremost to maximize profits
- Myth 4: Visionary companies share a common subset of “correct” core values. It’s not about having the right values, but that you have values you deeply believe
- Myth 5: The only constant is change. Core ideology (values) don’t change, everything else can.
- Myth 6: Blue-chip companies play it safe
- Myth 7: Visionary companies are great places to work, for everyone. If you don’t align with the core values, you’ll hate working there.
- Myth 8: Highly successful companies make their best moves by brilliant and complex strategic planning. Sometimes it happens by accident.
- Myth 9: Companies should hire outside CEOs to stimulate fundamental change
- Myth 10: The most successful companies focus primarily on beating the competition
- Myth 11: You can’t have your cake and eat it too. Visionary companies don’t buy into the “Tyranny of the OR” but rather the “Genius of AND”
- Myth 12: Companies become visionary primarily through “vision statements”
Chapter 2: Clock Building, Not Time Telling
It is helpful when you tell someone what time it is, but it is even more amazing when you build a clock so someone else can tell the time too! For leaders, “their greatest creation is the company itself and what it stands for.” (pg. 23) Visionary companies that are built to last went to work on their respective businesses. They didn’t wait until they had a charismatic leader or even a big idea! Most of them got together and decided what was important to them (core ideology) and then decided what to do next. They began their organizations by discovering why they were going into business in the first place.
The evidence suggests to us that the key people at formative stages of the visionary companies had a stronger organizational orientation [emphasis mine] than in the comparison companies, regardless of their personal leadership style. -Built to Last, pg. 34
Chapter 3: More Than Profits
One of the myths that Collins & Porras discovered is that visionary companies embrace the “Genius of AND” and reject the “Tyranny of the OR.” They don’t think, “Well we stick to our values OR commit to growth,” rather they think, “We’ll stick to our core ideology AND embrace progress that leads to growth.” Sure, without profit a company will die, but profit shouldn’t be the point of the business. Like air or water – it’s needed for us to live, but the point of life isn’t air and water. Knowing why you exist is the topic of the next chapter.
When articulating and codifying core ideology, the key step is to capture what is authentically believed; not what other companies set as their values or what the outside world thinks the ideology should be. –Built to Last, pg. 75
Core ideology is not contrived or aspirational. Core ideology is who you are without trying, its what grips your gut deep down inside. It’s not affected by the outside world. Core ideology is discovered, not defined, therefore it doesn’t change. It “can be boiled down to a piercing simplicity that provides substantial guidance.” (pg. 74
Chapter 4: Preserve the Core / Stimulate Progress
This chapter offers the crux of the entire book: “Preserve the core and stimulate progress” – that’s the essence of a visionary company.” (pg. 82) This is what clock building is all about. From core ideology, tangible mechanisms are put in place that align with the core values of an organization and stimulate progress. Core ideology doesn’t let you sit idly by, it provides the drive to move forward. Indeed, the rest of the book is about balancing systems that preserve the core of who you are and stimulated progress.
Chapter 5: Big Hairy Audacious Goals (stimulates progress)
BHAGs (bee-hags), or Big Hairy Audacious Goals, are clear and compelling goals that border on the ridiculous. They “engage people – it reaches out and grabs them in the gut. It is tangible, energizing, highly focused. People ‘get it’ right away; it takes little or no explanation.” (pg. 94) BHAGs build immediate momentum in an organization because they point people toward a goal that is so crazy and compelling that everyone wants to see it achieved. And don’t mistake normal goals for BHAGs. Companies like Boeing had BHAGs that, if they failed, would have ended the company! A BHAG takes risk, big risk! But the risk is why a BHAG is so awesome and engaging. People fall asleep floating down a lazy river, they don’t fall asleep swimming with sharks. Why? One word: RISK. Risk is adventurous, it’s exciting, and it stimulates progress.
The BHAGs looked more audacious to outsiders than to insiders. The visionary companies didn’t see their audacity as taunting the gods. It simply never occurred to them that they couldn’t do what they set out to do. -Built to Last, pg. 105
Chapter 6: Cult-Like Cultures (preserves the core)
Certainly Collins and Porras aren’t saying that visionary companies are cults. But they do have cult-like cultures:
- Fervently held ideology
- Tightness of fit
Visionary companies have very similar practices. They are adamant about their core ideology (core values), and if an employee is to succeed at a visionary company they must buy in completely to that core ideology otherwise it will be a horrible place to work. There is trust that elicits close relationships. “It means, in short, understanding that cult-like tightness around an ideology actually enables a company to turn people loose to experiment, change, adapt, and – above all – to act.” (pg. 139) A cult-like culture allows people to act in an organization because guiding principles (core ideology) runs so deep for each member that their actions are always aligned with the goals of the organization.
Chapter 7: Try a Lot of Stuff and Keep What Works (stimulates progress)
Trying lots of stuff practically insures that you will stumble upon something that works. Visionary companies, compared to the comparison companies, tried stuff out! They invested in R&D and tried different things. This is how bandaids were invented, it’s why Walmart now has greeters at their entrances, it’s how post-it note adhesive was invented – because visionary companies tried out lots of stuff. It was a mechanism to stimulate progress.
When in doubt, vary, change, solve the problem, seize the opportunity, experiment, try something new (consistent, of course, with the core ideology) – even if you can’t predict precisely how things will turn out. Do something. If one thing fails, try another. Fix. Try. Do. Adjust. Move. Act. No matter what, don’t sit still. –Built to Last, pg. 163
Chapter 8: Home-Grown Management (preserves the core)
Nearly all the visionary companies always promoted and hired from within. This was a mechanism that preserved the core ideology. The comparison companies always looked outside for charismatic leaders. The two examples of visionary companies that did hire CEOs from the outside still made hires based, not on personality, but on the leaders ability to preserve the core (e.g. Disney hiring Michael Eisner). The visionary company’s ability to hire from within meant they had succession mechanisms in place. Leaders constantly trained replacements which enabled them to preserve their core. When leaders fail to train replacements they are putting the entire core ideology and future of the organization at risk.
Chapter 9: Good Enough Never Is (stimulates progress)
The critical question asked by a visionary company is not “How well are we doing?” or “How can we do well?”…For these companies, the critical question is “How can we do better tomorrow than we did today?” -Built to Last, pg. 185
Visionary companies aren’t driven by what their competitors are doing. They may seek to become number one in their respective industries, but their core ideology serves as their drive. They are constantly asking how they can improve, how they can get better, what needs to go and what needs to stay. This drive to stimulate progress causes visionary companies to set long-range BHAGs – far distant big hairy audacious goals that cause intentional discontent within an organization. Discontent produces a lack of satisfaction in an organization’s progress. Visionary companies realize that there is no destination – there is no “arrival point” when progress is no longer needed. When a BHAG is reached, a new BHAG takes it’s place.
The good news is that one of the key elements of being a visionary company is strikingly simple: Good old-fashioned hard work, dedication to improvement, and continually building for the future will take you a long way…The bad news is that creating a visionary company requires huge quantities of good old-fashioned hard work, dedication to improvement, and continually building for the future. There are no shortcuts. –Built to Last, pg. 199
Chapter 10: The End of the Beginning
You can’t just take one chapter of this book and think it’ll make you a visionary company. It requires all of them, along with the hard work and disciplined action. So Collins and Porras give some guidelines:
- Paint the Whole Picture: Singled out, the principles and mechanisms will leave you wanting.
- Sweat the Small Stuff: Little things communicate big ideas.
- Cluster, Don’t Shotgun: Don’t put random mechanisms in place – have them all point toward one goal.
- Swim in Your Own Current, Even If You Swim Against the Tide: Outsiders may not understand.
- Obliterate Misalignments
- Keep the Universal Requirements While Inventing New Methods
Chapter 11: Building the Vision
In this final chapter Collins and Porras give a specific method to produce a complete vision. Your core ideology, which is made up of core values and purpose for existence, plus an envisioned future BHAG, plus vivid descriptions equals a completed vision.
Keep in mind that there is a big difference between being an organization with a vision statement and becoming a truly visionary organization with a vision statement and becoming a truly visionary organization. When you have superb alignment, a visitor could drop into your organization from another planet and infer the vision without having to read it on paper. This is the primary work of a clock builder. -Built to Last, pg. 239
Collins and Porras deliver on a fantastic book that I would recommend to anyone. In fact, it’s on just about everyone’s reading list and I’m catching up. As a pastor, I found the information to be incredibly applicable. Setting BHAGs and putting in place mechanisms that preserve the core while stimulating progress instantly created excitement and momentum in my own life. While some of the examples from for-profit businesses don’t cross over to all non-profits, the general principles of leadership and core ideology most certainly do. My hope is that you will pick up this book and find fresh creativity and inspiration to make decisions that build momentum, to remain faithful to your core ideology (core values), and to stimulate progressive. Don’t sit still. Do the work. There are no shortcuts.
Information and Personal Rating
- Title: Built to Last: Successful Habits of Visionary Companies (Harper Business Essentials)
- Author: Jim Collins & Jerry Porras
- Published: 1994 / 2004 (10 Yr Anniversary Edition)
- Pages: 368 (239 actual reading – the rest is the data from the study)
Personal Ratings (1-10)
- Applicability: 9
- Readability: 7
- Originality: 8
- Recommendation: Yes – Absolutely!