Built to Last by Jim Collins et al

by Jim Collins and Jerry I. Porras

Problem

Building a successful and enduring company is a complex task that requires more than just a great product or service. Many businesses struggle to sustain success over the long term and fail to outlast their competitors.

Promise

“Built to Last” presents the principles and practices that enduringly great companies have in common, enabling leaders and entrepreneurs to apply these concepts and build their organizations for long-term success and impact.

Perspective

“By understanding and applying the principles outlined in ‘Built to Last,’ I can guide my organization towards enduring greatness.”

Précis

In “Built to Last,” authors Jim Collins and Jerry I. Porras examine what distinguishes truly great companies from their competitors. Based on a six-year research project at Stanford University Graduate School of Business, the book presents the results of an exhaustive analysis of 18 exceptional and long-lasting companies, referred to as “visionary companies.”

Key concepts include the importance of building a company on core values and purpose beyond just making money, preserving the core/stimulating progress, and setting ‘BHAGs’ (Big Hairy Audacious Goals). The book also contrasts these visionary companies with a control group of competitors, illustrating how the principles contribute to enduring success.

The lessons from “Built to Last” can guide leaders in creating and sustaining visionary companies that make an impact and achieve long-term success.

Playbook

1. Core Ideology: Develop a core ideology for your company that includes core values and purpose beyond just making money. For example, 3M’s core ideology revolves around its commitment to innovation.
2. Preserve the Core/Stimulate Progress: Keep your company’s core ideology intact while encouraging progress and change in other areas. Walt Disney, for instance, has stayed true to its core values of imagination and wholesomeness while constantly innovating its offerings.
3. Big Hairy Audacious Goals (BHAGs): Set audacious and specific long-term goals that align with your company’s core ideology to stimulate progress. For instance, Ford’s early BHAG was to “democratize the automobile,” which drove its development of the Model T.
4. Cult-Like Cultures: Foster a strong culture that embraces the company’s core ideology. For instance, Johnson & Johnson’s “Our Credo” values statement has shaped the company’s culture and decision-making for decades.
5. Try a Lot of Stuff and Keep What Works: Encourage experimentation and innovation, keeping what works and discarding what doesn’t. 3M, for example, follows a “15 percent rule” that allows employees to spend 15% of their time on their projects, leading to successful innovations like the Post-it Note.
6. Homegrown Management: Develop leaders from within the company who are indoctrinated in the company’s core ideology. Companies like Procter & Gamble and GE are known for their strong internal leadership development programs.
7. Good Enough Never Is: Instill a culture of continuous improvement, where “good enough” is never enough. Companies like Motorola, with its Six Sigma quality improvement program, embody this principle.

Prompt

Reflect on your organization or one that you are familiar with. How does it align with the principles outlined in “Built to Last,” and where could it improve? Consider the company’s core ideology, long-term goals, culture, innovation strategy, leadership development, and approach to continuous improvement.