Back to Built to Last
WeWork’s IPO debacle and CEO ouster, Juul’s comeuppance, and many other recent fallen giants and C-suite changes spurred David Gelles’ acerbic piece in the NYT. He reminds us, among other things, that the now commonplace “utopian mission statements” from “Christ-like” founders that temporarily intoxicate the market eventually come down to the numbers when investors sober up.
Gelle’s fun-poking at these companies’ “yoga babble” made me want to revisit the seminal research that discovered the critical role of vision, mission, and values in organizations that stand the test of time.
Visionary companies
25 years ago, Jim Collins and Jerry Porras published research findings from the practices of “visionary” companies in Built to Last: Successful Habits of Visionary Companies (BtL). Not just successful and enduring, these companies were “the best of the best” and had been for decades. The researched revealed, “...the fundamental distinguishing characteristic of the most enduring and successful corporations is that they preserve a cherished core ideology while simultaneously stimulating progress. . . . they distinguish their timeless core values and enduring core purpose (which should never change) from their operating practices and business strategies (which should be changing constantly in response to a changing world.)”
Core ideology is the organization’s self-identity that transcends products, technological breakthroughs, management fads, and individual leaders. It’s the “bonding glue” that holds an organization together as it grows, decentralizes, diversifies. It’s comprised of two elements that never change:
Core purpose (mission): The organization’s “guiding star” — the soul of the organization — forever pursued but never reached. It’s the fundamental reason for being... “beyond making money.”
Core values: Essential and enduring tenets — a small set (no more than five or six) of guiding principles that require no external justification; they have intrinsic value and importance. There is no universal right set, and they would hold true even if they caused a business disadvantage. “The key is not what core values an organization has, but that it has core values.”
Core ideology isn’t made-up. It’s not what an organization wants to be, it’s what it already is. It can only be discovered by looking inside and putting words to what guides and inspires behavior and decision-making. It doesn’t need to be unique, it just has to be true and authentic. Two companies can have similar core values and purpose and pursue different visions of the future.
An envisioned future is a combination of what BtL calls a “Big Hairy Audacious Goal” (BHAG) that applies to the entire organization a decade out or beyond, and a vivid, vibrant, engaging, and specific description of what it will be like to achieve that BHAG. It’s all at once concrete, vivid and real, and a dream, hope, or aspiration. It’s not a sure bet. It gets people fired up to make it come true. The vision holds until until it’s been achieved, or circumstances have changed. Operating practices constantly change in pursuit of this desired future.
Walking the talk
I took a look at the mission and values of a few of the companies that Gelles eye-rolled at, and the sentiments are pretty solid. They just aren’t living them, or paying much attention at all: Juul’s mission is “Improve the lives of the world’s one billion adult smokers and eliminate cigarettes.” Hmm.
I travel in a universe of companies that know what they stand for and live it — truly built to last. The founders of these enterprises have their own deeply held core ideology and vision that radiates to everyone around them. They proudly shout their organization’s core and vision from the rooftops and drive alignment daily often without even trying. It’s just in them. A few exemplars:
Benetech was created to drive Social Change through Technology. They imagined decades ago that pattern recognition technology could be used to recognize words and letters, and software could be employed to read those words out loud for the blind and reading disabled. 15 million books covering 700,000 titles have been delivered to over 600,000 people globally. They’ve also innovated software solutions for human rights abuses, poverty, and environmental conservation with meaningful and measurable impact. There have been challenges and funding scares along the way, and this determined non-profit has not only survived, it has thrived by staying true to its core and vision.
Zingerman’s mission to Share the Zingerman’s experience, selling food that makes you happy, giving service that makes you smile, in passionate pursuit of our mission, showing love and care in all our actions, to enrich as many lives as we possibly can lead them beyond building a vibrant community of businesses delivering great food and great service to helping others succeed. Through ZingTrain, they openly share their organizational beliefs and systems (including a roadmap to create a rock-solid core and vision). Nearly four decades after the opening of the original deli, they continue to create an ever-inspired future. All heart and humanity here.
Allbirds exists to make better things in better ways — through nature — products that people feel good in, and feel good about, and serve as a driving force in a new age of sustainable manufacturing. When Amazon launched a knock-off of their Wool Runner for less than half the price, Fast Company reported, “Joey Zwillinger, Allbirds cofounder and co-CEO, responded that . . . It’s not the similarities in design that bother him most; it’s the fact that Amazon did not go so far as to copy Allbirds’ stringent sustainability practices. While he’d prefer that Amazon not copy Allbirds’ design at all, he’s encouraging the brand to borrow freely from his company’s eco-friendly supply chain practices, including some of the sustainable new materials Allbirds has invented.” Wow.
And, try a lot of stuff and keep what works
I love that BtL’s research also found, ”. . . in examining the history of visionary companies . . . they made some of their best moves not by detailed strategic planning, but rather by experimentation, trial and error, opportunism, and — quite literally — accident.” Visionary leaders, strategies and plans, and the difficulty of BHAGs didn’t explain why visionary companies did so well. An organic process of “try a lot of stuff and keep what works” did — building the organization as their primary means of creating the future.” This isn’t just “throw it against the wall and see what sticks.” This is a paradox of rigor and reflection combined with openness, curiosity and courage, all in service to an organization’s core ideology and vision.