Built to Last
Successful Habits of Visionary Companies
by James C. Collins and Jerry I. Porras

Built to Last is a fascinating and easy to read book. The authors James C. Collins and Jerry I. Porras wanted to answer this basic question – What are the characteristics of companies that enjoy longevity and consistently outperform their competitors? Their book goes into great detail describing these companies and identifies the factors associated with their success. The following synopsis shares just a portion of what the authors conveyed in their book Built to Last.

Collins and Porras discovered that the most important feature regarding the success of these companies was they were visionary in their approach and more ideologically driven than profit-driven. They had a sense of purpose that went beyond just making money. These companies concentrated first on their organization’s core values, concept of self and systems. Maximizing shareholder wealth or profits was not a dominant driving force or primary objective of these companies. For them, profits were like oxygen – necessary for life, but not the point of it. Being a visionary company itself was the ultimate creation.

Visionary companies spent more on human capital than their competitors. They made significant investments in “universities” and education centers within their organizations. These companies understood that if you treat and train your employees like every other company that you’d end up being like any other company. Visionary companies didn’t just “preach” the value of change, experimentation and constant improvement. They instituted concrete organizational mechanisms to stimulate change, encourage experimentation and support continuous improvement. Visionary companies are not exactly comfortable places to work. And that’s precisely the impression they want to give. These companies thrive on discontent. They understand that contentment leads to complacency, which inevitably leads to decline.

The successful companies described in the book didn’t look for “balance.” Rather, they saw “balance” as a slippery slope that leads to complacency. “Balance” denoted “midpoint,” “fifty-fifty,” and “half and half.” These companies simply did not accept the proposition that they must have a balanced approach or choose between short-term performance and long-term success. They built first and foremost for the long-term success but simultaneously held themselves to highly demanding short-term standards. They believed they could do very well in the short-term as well as very well in the long-term and they did.

Visionary companies rejected the “Law of OR,” as in you can have change OR stability, be conservative OR bold, have low cost OR high quality, have creative autonomy OR consistency and control, invest for the future OR do well in the short-term, make progress by methodical planning OR by opportunistic grouping. Instead they saw these countervailing concepts as complementing each other rather than contending with one other.

Successful organizations described in the book understood the importance of having and holding on to a core ideology (values). Over time, cultural norms must change, strategy must change, product lines must change, goals must change, competencies must change, administrative policies must change, organization structure must change, and reward systems must change. But, ultimately the only thing these companies would not change over time was their core values.

The authors are quick to point out that visionary companies do not have perfect nor unblemished records. They are willing to take risks and make mistakes. They don’t wait for some external force to say, “It is time to change.” They constantly ask themselves - What is our reason for being? What would be lost if we ceased to be? What can we do better tomorrow than we did today? Collin and Porras found that some of the best moves by visionary companies were not by detailed strategic planning, but rather by experimentation, trial and error, opportunism, and – quite literally – by accident.

Yet their success was not a product of luck. These companies listened to anyone with an original idea, no matter how absurd it might sound at first. They encouraged, they didn’t nitpick. They let people run with an idea and gave them the room they needed. They accepted that mistakes would be made. They were willing to try a lot of “stuff” and then kept what worked. They hired good people and left them “alone.” Lastly, they continued a relentless self-improvement process with the aim of doing better and better, forever into the future. For visionary companies “good enough” never is!

Another unique similarity of visionary organizations is they created what Collins and Porras called BHAG (Big Hairy Audacious Goals) that were so clear and compelling that they required little or no explanation, that fell outside the companies comfort zone, that required a heroic effort and were so bold and exciting that they would continue to stimulate progress even if the current leaders disappeared before they were achieved. Yet, BHAGs where never launched if they were in conflict with the company’s core values. They must reinforce the company’s core ideologies and reflected its self-concept. Implemented properly, BHAGs serve as a unifying focal point of effort – often creating immense team spirit.

Collins and Porras’ research found that visionary companies shattered the twelve myths of highly successful companies. It doesn’t take a great idea to start a great company. Great and charismatic visionary leaders are not necessary. The most successful companies do not exist first and foremost to maximize profits. Visionary companies do not share a common subset of “correct” core values. Some things don’t change (core values). They don’t play it safe. They are not great places to work for everyone. They do not make their best moves by brilliant and complex strategic planning. They do not hire outside CEOs to stimulate fundamental change. They do not focus primarily on beating the competition. They often times have their cake and eat it too. And, “vision statements” do not necessarily make a visionary company.

How does your organization become visionary? The first step is to shift your perspective and change your thinking. The second step is to inculcate the following concepts into your corporate culture.

1. Paint the whole picture. One program, strategy, speech, or symbolic gesture isn’t enough. Visionary companies employ a variety of signals and actions that continually reinforce the core ideology and stimulate progress.



2. Sweat the small stuff. People don’t work in the “big picture.” Little things make an impression, like the business cards Disney gives its entire workforce. This action says, “We want you to be a professional.”



3. Cluster, don’t shotgun. Put mechanisms and processes in place that work in harmony, reinforces each other and hold up your core values.



4. Swim in your own current. Look to your internal compass for guidance, not the standards, trends, or fads of the outside world. Don’t ask, “Is this practice good?” ask, “Is this practice appropriate for us?”



5. Obliterate misalignments. The only sacred cow is core ideology, be willing to change everything else.

Next, ask and answer the following questions: What “mechanisms of discontent” can we create that would obliterate complacency and bring about change? What are we doing to invest for the future while doing well today? How do we respond to downturns? Does my organization continue to build for the long-term even during difficult times? Do people in my organization understand that comfort is not the objective?

Then develop clear and compelling BHAGs and ask yourself the following questions: Does it stimulate forward progress? Does it create momentum? Do people find it stimulating, exciting, and adventurous? Are they willing to throw their creative talents and human energies into it? Does it fit with our core ideology?

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. It is an evolutionary not revolutionary process. Take small steps and be patient.

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