Built To Last James C. Collins and Jerry I. Porras Chapter 1 The Best of The Best The critical question is not “What’s common across a group of companies?” Rather, the critical issues are: “What’s essentially different about these companies? Selected a comparison company for each visionary company. Compare gold medal teams to silver and bronze medal teams whenever possible to give real meaning to our findings. History and Evolution They reflect the accumulation of past events and the shaping force of underlying genetics that have roots in prior generations. We believed our comparison analysis would be much more powerful from a historical perspective. Looked at companies throughout their entire life spans and in direct comparison to other companies. Employed a framework based on a technique called “Organization Stream Analysis for collecting and sorting information. Chapter 2 Clock Building, Not Time Telling Having a great idea or being a charismatic visionary leader is “time telling”; building a company that can prosper far beyond the presence of any single leader and through multiple product life cycles is “clock building.” They concentrate primarily on building an organization-building a ticking clock- rather than on hitting a market just right with a visionary product idea and riding the growth curve on an attractive product life cycle. Their greatest creation is the company itself and what it stands for. Our research punched holes in two widely held and deeply cherished myths: the myth of the great idea and the myth of the great and charismatic leader. We found that creating and building a visionary company absolutely does not require either a great idea or a great and Built to Last by James C. Collins and Jerry I. Porras Natural Church Development – Functional Structures Review Notes by Ron Bonar 1 of 15
charismatic leader. In fact, we found evidence that great ideas brought forth by charismatic leaders might be negatively correlated with building a visionary company. These surprising findings forced us to look at corporate success from an entirely new angel and through a different lens than we had used before. They also have implications that are profoundly liberating for corporate managers and entrepreneurs alike. Bill Hewlett and Dave Packard decided to first start a company and then figure out what they would make. They just started moving forward, trying anything that might get them out of the garage and pay the light bulls. Texas Instruments traces its roots to a highly successful initial concept. TI started with a “great idea.” HP did not. Neither did Sony. In fact, Ibuka and his seven initial employees had a brainstorming session after starting the company- to decide what products to make. In comparison, Kenwood’s founder appeared to have a specific category of products in mind. Sam Walton also started without a great idea. Walton built incrementally, step by step, from that single store until the “great idea” of rural discount popped out as a natural evolutionary step almost two decades after he started his company. He wrote in Made in America “And like most overnight successes, it was about twenty yeas in the making.” This mythology holds that those who launch highly successful companies usually begin first and foremost with a brilliant idea (technology, product, market potential) and then ride the growth curve of an attractive product life cycle. Yet this mythology-as compelling and pervasive as it is – does not show up as a general pattern in the founding of the visionary companies. Few of the visionary companies in our study can trace their roots to a great idea or a fabulous product. Some of our visionary companies began like Sony with outright failures. 3M started as failed corundum mine. Bill Boeing’s first airplane failed. Waiting For “The Great Idea” Might Be A Bad Idea Henry Ford didn’t come up with the idea of the Model T and then decide to stat a company around that idea. Just the opposite....
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