Build things that last

My summary and notes on Jim Collins’ book “Built to Last.” Resources on building culture with +30 culture docs examples.

Photo by Luis Aceves on Unsplash

Built to Last, by Jim Collins and Jerry Parras, brought down my stereotypes about exceptional companies one by one like dominoes. It turned out to be my best read in 2020, as the book encouraged me to quit my job and start an entrepreneurial adventure.

The authors took a set of exceptional companies and studied them compared to another group of “not bad” companies with the same shot in life but didn’t attain the same stature.

The book contains hundreds of enlightening stories, specific examples, and anecdotes. I encourage every exec, innovation leader, or entrepreneur to read it.

In this article, I’ll present:

  • #1: Why I read this book
  • #2: The core idea
  • #3: The key concepts
  • #4: How the book upgraded me
  • #5: More resources about building a culture

#1: Why I Read this Book

As a product manager and aspiring entrepreneur, I felt inspired by the notion of building enduring, great products, teams, or companies. The title “Built to Last” immediately struck a chord with me.

But at the same time, I was tired of the year’s fad and buzzwords.

On the one hand, as a former consultant, I watched companies pay big bucks for consulting services to keep up with the latest managerial trends. However, these never stop changing.

On the other hand, I watched startups define their values and promote their life model, with bullshit injunctions like “Be buddies” or “Fake it ‘till you make it” and a few ping pong tables. From the outside, it seemed ridiculous to me.

My conviction was that there had to be some deeper common traits to be a successful company: I needed to understand the fundamentals. “Built to Last” was extremely valuable to me in understanding these fundamentals and how to apply them.

#2: The Core Idea

Spoiler alert, this graph I made summarizes the fundamental concepts of the book:

Built to Last Summary

In 3 sentences:

  1. Visionary companies preserve a cherished core ideology while simultaneously stimulating progress and change in response to a changing world.
  2. Core ideology should never change, while non-core things are open for change.
  3. Visionary companies can manage continuity and change both simultaneously and to the extreme.

#3: The Key Concepts

Clock building, not time telling: visionary companies’ ultimate creation is the company itself. They concentrate on designing an organization (clock building) rather than hitting with a visionary product idea (time-telling). Corollary: You don’t need to have a great idea (or to be a high-profile charismatic leader) to start a company. Be prepared to kill, revise, or evolve an idea, but never give up on the company itself.

The genius of the AND: visionary companies are comfortable living with two seemingly contradictory forces simultaneously, both to an extreme: purpose AND profits, fixed core ideology AND vigorous change, conservatism around the core AND bold, risky moves, etc.

More than profits: visionary companies pursue a cluster of objectives of which making money is only one and not necessarily the primary one. They rely on an authentic core ideology. Regardless of the content of this ideology, they seek to attain consistent end-to-end alignment within the organization. They use it to build their culture, select employees, define strategy, goals, tactics, etc.

A core ideology is composed of two parts:

  1. Values: 3–6 general guiding principles the company strives to live to for +100 years regardless of changes in the external environment (even if people stop appreciating these values or even start to fight them).
  2. Purpose: the fundamental reasons for existence, a perpetual guiding and inspiring star on the horizon.

Preserve the core and stimulate progress: visionary companies create tangible mechanisms to preserve the core and stimulate progress. The drive for progress doesn’t need external justification. It arises from a deep inner human urge. It’s an internal force to go further, do better, and create new possibilities.

Big Hairy Audacious Goals (BHAGs): visionary companies use bold missions (BHAGs) as a potent mechanism to stimulate progress. BHAGs are clear, compelling, tangible, energizing, and highly focused goals consistent with the company’s core ideology. BHAGs fall well outside the comfort zone, yet they look more audacious to outsiders than to insiders. They serve as a unifying focal point of effort, creating immense team spirit and people commitment.

Cult-like cultures: visionary companies translate their ideology into tangible mechanisms, indoctrinate people, impose tightness of fit, and create a sense of belonging to something special. They have clarity about who they are, what they’re all about, and what they’re trying to achieve; they keep the ones who fit exceptionally well and expunge others like viruses.

Try a lot of stuff and keep what works: visionary companies make their best moves not by detailed strategic planning but by experimentation, trial and error, opportunism and accident. As species, they add variations and intelligently select the ones that prosper. This evolutionary progress is complementary to BHAGs because it involves ambiguity and begins with small incremental steps.

Home-grown management: visionary companies develop, promote, and carefully select managerial talent grown from inside the company to preserve their core. Significant change and fresh ideas come from insiders.

Good enough never is: visionary companies are demanding of themselves. They install potent mechanisms to create discomfort and stimulate change and improvement before the external world demands it. Creating a visionary company requires enormous quantities of good old-fashioned hard work, dedication to progress, and continually building for the future.

The end of the beginning: visionary companies see their statement as a first step. They constantly translate their core ideology and unique drive for progress into the organization’s fabric.

#4: How the Book Upgraded Me

Since reading the book, I started to take a critical look at companies and leaders:

  • Are the companies I admire genuinely visionary? If so, what are their ideology and drive to progress?
  • Are the leaders I admire clock builders or time tellers? What are the common traits of visionary company architects?

In the period of the COVID-19 pandemic in 2020, this idea particularly struck me:

The proper first response to a changing world is not ”How should we change?” but rather to ask “What do we stand for and why do we exist?”

In turn, I decided to embark on an entrepreneurial adventure. Here is the to-do list I wrote down as an aspiring entrepreneur:

Acquire personality traits of company architects (clock builders)

Define and preserve the core:

  • Define an authentic core ideology by iterations.
  • Hire and keep people that share the same values.
  • Create a sense of belonging to something special.
  • Constantly translate the core ideology into the fabric of the company.

Stimulate progress:

  • Design an environment conducive to the emergence of great ideas.
  • Set Big Hairy Audacious Goals.
  • Experiment, try many variations, and select the ones that work.
  • Hold myself to highly demanding standards.
  • Be prepared for enormous quantities of hard work.
  • Create mechanisms of discontent to obliterate complacency.

#5: More Resources on Building a Culture

I bookmarked these resources on building culture. I didn’t read everything, but I hope to get down to it as soon as I need it.

Theoretical stuff

Stories

Culture Docs

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