Visionary Leaders and Enduring Companies: Built to Last

Tuesday, October 28, 2014

In a previous post, we looked at Stephen Covey’s The Seven Habits of Highly Successful People, a classic book showing the traits and practices that successful people are continually looking to improve. While it hasn't been around as long, the book, Built to Last: Successful Habits of Visionary Companies, has drawn just as many accolades as Covey's long-admired classic.

And the praise is well deserved. In contrast to the folksy and “common-sense” style of The Seven Habits of Highly Successful People, Jim Collins and Jerry Porras clearly predicate Built to Last on in-depth research conducted over six years at the Stanford School of Business. The two authors highlight 18 companies that were identified as “exceptional” and compare them to their peers in the business world.

Through their examination, they identify why some businesses achieve great success while others in the same industry, and on a seemingly similar path, fade. When you boil it all down to the least common denominator, the answer is revelatory.

Businesses that endure have a purpose. And a purpose is different than a strategy or a plan. A strategy tells how a company expects to succeed; a plan shows how a company will execute on the strategy. While a purpose is a literal “reason for being.”

The book does define successful companies based on performance metrics. And, while not highlighted in the research, it's obvious that successful companies have people who do focus on revenues, expenses, and growth goals. But when investigating the companies with superior metrics, one can see they thrive precisely because the executive leaders are not focused on the metrics, but rather on constant reinforcement of the company's purpose.

As a leader or entrepreneur, there are a few ways to make sure you're developing a purpose-driven organization. Begin by answering the following questions:

Why are you in business? This question needs to be focused outward, not inward. While all companies exist to make a profit, long-lasting companies exist to solve a problem. So, you need to answer how you're maximizing the benefits to the customers, not to your profits.

How do you run your business? Again, this is a visionary rather than a tactical answer. How will you improve the lives of your customers and the communities you serve? 

What do you offer? Not simply what products do you have, but what do you do that creates a positive impact on the world?

The best companies use the answers to these questions as their rallying cry. Profits and “doing good” are not competing goals. The research shows that the best performing companies often succeed because they are trying to make the world, or at least the lives of their customers, better and easier. 


photo credit: MrOmega via photopin cc

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