More on this book
Community
Kindle Notes & Highlights
it is better to understand who you are than where you are going
The crucial variable is not the content of a company’s ideology, but how deeply it believes its ideology and how consistently it lives, breathes, and expresses it in all that it does.
the great-idea approach shifts your attention away from seeing the company as your ultimate creation.
shift from seeing the company as a vehicle for the products to seeing the products as a vehicle for the company.
if you see the ultimate creation as the company, not the execution of a specific idea or capitalizing on a timely market opportunity, then you can persist beyond any specific idea—good or bad—and move toward becoming an enduring great institution.
“Hewlett Packard Chairman Built Company by Design, Calculator by Chance.”
existence of a core ideology as a primary element in the historical development of visionary companies.
more ideologically driven and less purely profit-driven than the comparison companies in seventeen out of eighteen pairs.
pursue their aims profitably.
ideology AND profits—
The real reason for our existence is that we provide something which is unique [that makes a contribution].
Johnson & Johnson, like HP, explicitly speaks first to ideals beyond profit, and then emphasizes the importance of profit within the context of those ideals.
The Harvard Business School dedicated an entire case study to how J&J translated the credo into action
the authenticity of the ideology and the extent to which a company attains consistent alignment with the ideology counts more than the content of the ideology.
Core Ideology = Core Values + Purpose
you might ask yourself: “Which of these values would we strive to live to for a hundred years regardless of changes in the external environment—even if the environment ceased to reward us for having these values, or perhaps even penalized us? Conversely, which values would we be willing to change or discard if the environment no longer favored them?”
A very important point: We strongly encourage you not to fall into the trap of using the core values from the visionary companies (listed in Table 3.1) as a source for core values in your own organization.
When articulating and codifying core ideology, the key step is to capture what is authentically believed,
“I want to discuss why a company exists in the first place. In other words, why are we here?
The primary role of purpose is to guide and inspire, not necessarily to differentiate.
“We exist to make cartoons for kids” would have been a terrible purpose statement for Disney, neither compelling nor flexible enough to last one hundred years. But “to use our imagination to bring happiness to millions”
Ask, "why do you want to make cartoons for kids?" And, continue to ask deeper why's until the purpose is timeless
What is its reason for being? What would be lost if it ceased to exist?
“Preserve the core and stimulate progress” that’s the essence of a visionary company.
The core ideology enables progress by providing a base of continuity around which a visionary company can evolve, experiment,
The drive for progress enables the core ideology,
has concrete, tangible mechanisms to preserve the core ideology and to stimulate progress.
tangible, energizing, highly focused.
Create BHAGs that take a life of their own and thereby act as a stimulus through multiple generations of leadership.
clear and compelling that it requires little or no explanation. Remember, a BHAG is a goal—
Finally, and most important of all, a BHAG should be consistent
with a company’s core ideology.
creating an environment that reinforces dedication to an enduring core ideology is clock building.
Cult-like cultures, which preserve the core, must be counterweighted with a huge dose of stimulating progress.
Stimulating progress and new ideas as part of tbe culture
The step looks brilliant in retrospect, but in reality was simply the result of an opportunistic experiment that happened to work out.
evolutionary progress.
evolutionary progress involves ambiguity
evolutionary progress usually begins with small incremental steps or mutations, often in the form of quickly seizing unexpected opportunities that eventually grow into major—and often unanticipated—strategic shifts.
uses BHAGs to define a mountain to climb, and uses evolution to invent a way to the top.
setting only a few clear, overarching goals. Then, on an ad hoc basis, his people were free to seize any opportunities they saw to further those goals.
detailed plans usually fail, because circumstances inevitably change.
In response to an opportunity disguised as a problem
We] must possess a two-fisted generating and testing [process] for ideas. . . . Every idea evolved should have a chance to prove its worth, and this is true for two reasons: 1) if it is good, we want it; 2) if it is not good, we will have purchased our insurance and peace of mind when we have proved it impractical.
five basic lessons for stimulating evolutionary progress in a visionary company.
selection involves two key questions. The first is simply pragmatic: Does it work? But just as important is the second question: Does it fit with our core ideology?
Over the period 1806 to 1992, we found evidence that only two visionary companies (11.1 percent) ever hired a chief executive directly from outside the company, compared to thirteen (72.2 percent) of the comparison companies.
the continuity of quality leadership that matters—continuity that preserves the core.
The entrepreneurial model of building a company around a great idea, growing quickly, cashing out, and passing the company off to outside professional managers will probably not produce the next Hewlett-Packard, Motorola, General Electric, or Merck.
Don’t bother just to be better than your contemporaries or predecessors. Try to be better than yourself.
visionary companies apply the concept of self-improvement in a much broader sense than just process improvement. It means long-term investments for the future; it means investment in the development of employees; it means adoption of new ideas and technologies. In short, it means doing everything possible to make the company stronger tomorrow than it is today.
Visionary companies habitually invest, build, and manage for the long term to a greater degree than the comparison companies in our study. “Long term” at a visionary company does not mean five or ten years; it means multiple decades—fifty years is more like it. Yet, at the same time, they do not let themselves off the hook in the short term.
