“Built to Last” by Jim Collins and Jerry I. Porras is a groundbreaking book that explores what differentiates exceptional companies from their counterparts. Drawing on a six-year research project, Collins and Porras identify a set of timeless principles and core values that visionary companies embrace to achieve long-term success and enduring impact. Through engaging anecdotes, insightful analysis, and compelling examples, the authors provide a roadmap for building organizations that can weather the test of time, adapt to changing market conditions, and continue to thrive.
Collins and Porras challenge the notion that success is solely dependent on charismatic leaders or short-term strategies. Instead, they argue that visionary companies are built on a solid foundation of enduring principles and a clear sense of purpose. By preserving core values while stimulating progress and embracing change, these companies create cultures that inspire employees, foster innovation, and ultimately outperform their counterparts.
The book is filled with captivating stories and relevant case studies that bring the principles to life, making it a compelling read for anyone interested in business, leadership, and organizational success. Whether you’re a seasoned executive, an aspiring entrepreneur, or a student of management, “Built to Last” offers invaluable insights and actionable strategies for building enduring institutions that can make a lasting impact in the fast-paced and ever-changing business world.
About the Authors
The book “Built to Last” is written by Jim Collins and Jerry I. Porras. Both authors are renowned experts in the field of business management and have made significant contributions to the study of visionary companies.
Jim Collins is a well-known author, speaker, and consultant. He has authored several best-selling books on leadership and management, including “Good to Great” and “Great by Choice.” Collins is known for his extensive research and data-driven approach to studying successful companies and identifying the factors that contribute to their long-term success. His insights have helped countless organizations improve their performance and achieve sustainable growth.
Jerry I. Porras is a professor emeritus of organizational behavior and change at Stanford University Graduate School of Business. He has also co-authored other influential works, such as “Stream Analysis: A Powerful Way to Diagnose and Manage Organizational Change” and “Organizational Change and Design: A Theoretic Perspective.” Porras brings a deep understanding of organizational behavior and change management to the book.
Collins and Porras collaborated on “Built to Last” to explore the concept of visionary companies and uncover the characteristics and practices that set them apart. Their research involved studying a rich set of companies over a span of six years. They sought to identify what makes some companies thrive and last for generations while others struggle to survive.
The authors’ approach to writing “Built to Last” is empirical and evidence-based. They conducted extensive interviews, analyzed historical data, and compared successful companies with their less successful counterparts. This rigorous research methodology is a hallmark of their work, allowing them to provide practical insights backed by real-world examples.
Style of Writing
The writing style in “Built to Last” by Jim Collins and Jerry I. Porras is authoritative, data-oriented, and engaging. The authors present their ideas and concepts with a strong sense of credibility, backed by extensive research and empirical evidence. Throughout the book, they provide numerous examples and case studies to illustrate their points, making the content relatable and applicable to real-world situations.
Collins and Porras have a knack for presenting complex concepts in a clear and accessible manner. They use straightforward language, avoiding jargon and unnecessary complexity, which allows readers to easily grasp the key ideas and principles discussed. Additionally, they employ a conversational tone that makes the book enjoyable to read, while still maintaining a high level of professionalism and academic rigor.
The authors also infuse the book with wit and personality, making the content more engaging and relatable. They interweave anecdotes and stories to provide context and add depth to their arguments. These anecdotes, combined with their insightful analysis, help to break up the dense material and keep readers captivated throughout.
Overall, the style of writing in “Built to Last” strikes a balance between being informative and entertaining. Collins and Porras combine their authoritative voice, data-driven approach, and engaging storytelling to deliver a compelling and enlightening book on building enduring institutions.
Built to Last: Chapter Wise Summary
Chapter 1: “The Best of the Best”
In the first chapter of “Built to Last,” Jim Collins and Jerry I. Porras introduce the concept of a visionary company and discuss their criteria for determining what makes a company truly exceptional. They compare successful companies to their less successful counterparts and identify a set of core principles that are shared by the best of the best. The authors emphasize that these companies are not built on the charisma of a single leader, but rather on a strong foundation that allows them to endure for decades, if not centuries.
Collins and Porras argue that visionary companies have a long-term perspective, driven by a set of core values. They state, “Visionary companies pursue a composite ideology that blends the seemingly incongruent purposes of being timeless and enduring yet also of stimulating progress and change“. They highlight how these companies maintain a balance between preserving their core values and stimulating progress.
The authors provide examples of companies like 3M, Disney, and Hewlett-Packard that have stood the test of time and have become the cornerstones of their industries. They explain that these companies are not driven by short-term profitability or fads, but rather by a deeply ingrained purpose. They state, “The vision is about their fundamental reason for existence, the fundamental values by which they live“.
Collins and Porras also challenge the notion that visionary companies are built on the charisma and personality of a single leader. They argue that while leaders play a role, it is the underlying systems and processes that truly drive a visionary company. They state, “While individual leaders play a visible and important role, the rise and fall of the individual leader matter far less than the rise and fall of the company itself”.
The authors provide the example of IBM, where the departure of IBM’s charismatic leader Thomas Watson Sr. did not derail the company’s long-term success. They explain how IBM’s strong foundation and adherence to core principles allowed the company to continue to thrive even after Watson’s departure.
Chapter 2: “Clock Building, Not Time Telling”
In this chapter, Collins and Porras dive deeper into the concept of a visionary company and introduce the idea that the leaders of these companies are not merely time tellers, but rather builders of a lasting institution. They discuss how visionary companies focus on creating enduring impact, rather than short-term results. By setting the stage for long-term success, these leaders are able to guide their organizations through challenging times and ensure their longevity.
The authors emphasize the need for leaders to focus on building an enduring institution, rather than solely on achieving short-term results. They state, “The primary output of a truly great organization is not predictability, but adaptability; the creation of mechanisms that can cope with surprises”. This highlights the importance of creating systems and processes that can withstand change and uncertainty.
Collins and Porras provide examples of visionary companies that have successfully embraced the concept of “clock building.” One such example is 3M, which has a long history of innovation and an institutionalized process of experimentation. The authors write, “3M preserves its commitment to clock building by stimulating progress through research and development”. This showcases how 3M’s focus on building a culture of innovation and continuous improvement has allowed the company to adapt and thrive over time.
The authors contrast this with the concept of “time telling,” which they describe as a leadership style focused on short-term results and personal charisma. They state, “Time tellers may provide charismatic leadership and easily win followers, but they do not build enduring greatness in their organizations”. This highlights the limitations of relying solely on the individual attributes of a leader, as opposed to building a strong foundation and enduring principles.
Collins and Porras emphasize that the leaders of visionary companies understand the importance of focusing on long-term impact. They state, “A visionary company understands that a truly great vision is, by definition, imbued with enduring and unchanging core values“. This emphasizes the need for leaders to not only have a clear vision, but also to ensure that the company’s core values and purpose remain steadfast throughout its existence.
Chapter 3: “The Genius of ‘And’
Collins and Porras explore the concept of embracing the “genius of ‘and'” in this chapter. They highlight the fact that visionary companies are able to balance seemingly contradictory elements, such as being both highly innovative and disciplined. These companies don’t settle for either/or decisions, but instead find ways to achieve both outcomes. By embracing this mindset, visionary companies are able to continually adapt and evolve, setting themselves apart from their competitors.
The authors state, “The ‘genius of ‘and” means that instead of choosing between A or B, you figure out a way to have both A and B.” This ability to break free from binary choices allows visionary companies to remain adaptable and innovative, constantly seeking new ways to expand their offerings and meet customer needs.
Collins and Porras provide the example of Walt Disney, describing how he was able to combine entertainment and education in the creation of Disneyland. They quote Disney, who said, “The Disneyland that will be a living, breathing blueprint of the future. We see it as a viable city that is always in a state of becoming.” By embracing both entertainment and education, Disney created an entirely new experience that revolutionized the theme park industry.
The authors further discuss how visionary companies embrace multiple attributes that may seem contradictory. They explain, “Visionary companies embrace several pairs of seemingly contradictory notions … and as a result, they do things differently than their competitors.”
They use the example of IBM, which balances both centralized control and decentralized decision-making. IBM’s corporate culture promotes disciplined behavior and adherence to standardized processes, while also fostering individual initiative and innovation.
Another example is 3M, a company that balances a focus on both long-term sustainability and short-term profitability. 3M’s commitment to long-term sustainability enables them to invest in research and development, while their focus on short-term profitability ensures they remain financially stable and competitive.
Collins and Porras highlight the power of embracing the “genius of ‘and'” by stating, “Just as a company can be both conservative and bold, both predictable and surprising, it can also be ‘and’ instead of ‘or’—it can preserve the core and stimulate progress.”
Chapter 4: “Clock Building, Not Time Telling”
In this chapter, Collins and Porras discuss the importance of preserving the core values and purpose of a visionary company, while also embracing change and innovation. They emphasize that successful companies are able to adapt and evolve without compromising their fundamental beliefs. The authors provide examples of companies that have successfully managed this balance, and they stress the importance of strong leadership and a clear vision in navigating these challenges.
The authors highlight the example of IBM, a company that successfully preserved its core values while adapting to the changing market. They quote Thomas Watson Sr., the founder of IBM, who said, “I firmly believe that any organization, in order to survive and achieve success, must have a sound set of beliefs on which it premises all its policies and actions.” IBM’s core beliefs, such as customer service and technical excellence, remained intact over the years, even as the company ventured into new markets and technologies.
Collins and Porras also discuss the concept of the “BHAG”, or Big Hairy Audacious Goal. They use the example of Merck, a pharmaceutical company, that set a BHAG of curing river blindness in Africa. Despite facing significant scientific and logistical challenges, Merck remained committed to their BHAG, ultimately succeeding in developing a drug that could treat and prevent the disease.
The authors caution against companies that lose sight of their core values in pursuit of short-term profits. They present the example of Sears, a once successful retail company, that lost touch with its core beliefs and focused solely on financial gains. As a result, Sears began to decline and lost its competitive edge in the market.
To preserve the core while stimulating progress, Collins and Porras suggest three key strategies. First, they recommend creating a cultural mechanism that reinforces the company’s core values and purpose. This could be through rituals, symbols, or stories that serve as a reminder of what the company stands for.
Second, the authors emphasize the importance of leadership that aligns with the company’s core values. They argue that leaders who demonstrate and embody these values inspire others to do the same, creating a strong and cohesive organizational culture.
Finally, Collins and Porras encourage visionary companies to embrace change and take calculated risks. They argue that innovation and progress should be rooted in the company’s core values, rather than appearing as a departure from them. By investing in new ideas and initiatives that align with their vision, companies can stay relevant and successful over the long term.
Chapter 5: “The Big Hairy Audacious Goal”
Collins and Porras introduce the concept of a Big Hairy Audacious Goal (BHAG) in this chapter. They argue that visionary companies set goals that are ambitious, inspiring, and seemingly unachievable at the time. These goals serve as a rallying point for employees, tying them together and motivating them to push beyond their limits. The authors provide examples of companies that have successfully set and achieved BHAGs, illustrating the power of having a clear and compelling vision.
The authors define a BHAG as “a clear and compelling goal that equally serves as a unifying focal point of effort and a catalyst for team spirit“. They emphasize that BHAGs are not limited to a specific timeframe but are meant to stretch the organization’s capabilities and inspire long-term performance.
Throughout the chapter of Built to Last, Collins and Porras provide examples of companies that have successfully set and achieved BHAGs, illustrating the power of having a clear and compelling vision. One such example is IBM’s BHAG to “put a man on the moon” in the 1960s. Although not directly related to their core business, IBM’s involvement in the Apollo program allowed them to push the boundaries of technology and ultimately solidify their position as a leading player in the computer industry.
Another example highlighted in the book is 3M’s BHAG of generating 30% of its annual revenue from products launched in the past four years. This BHAG inspired a culture of innovation within the company, pushing employees to constantly come up with new and creative ideas. As a result, 3M introduced successful products such as Post-it Notes, which not only achieved the BHAG but also contributed to the company’s long-term success.
Collins and Porras also discuss how BHAGs can evolve over time. They mention Merck’s BHAG to “cure river blindness” by developing and distributing a drug to treat the disease. Although Merck was not able to achieve this goal, they made significant progress and eventually partnered with the World Health Organization. This example illustrates that even if a BHAG is not fully realized, it can still inspire actions that make a positive impact.
The chapter concludes by emphasizing the importance of a BHAG in guiding a visionary company’s actions and decisions. A BHAG provides a sense of purpose, inspires innovation, and unifies a team around a common goal. Collins and Porras argue that setting a BHAG is not just about achieving a specific outcome, but rather about the journey and the impact it has on the organization’s culture and long-term success.
Quote from the book: “A BHAG engages people– it reaches out and grabs them in the gut. It is tangible, energizing, highly focused. People “get it” right away; it takes little or no explanation“.
Chapter 6: “Cult-like Cultures”
In this chapter, Collins and Porras explore the idea of a cult-like culture within visionary companies. They emphasize that these cultures are not negative or destructive, but rather a strong shared set of values and beliefs that bind employees together and guide their actions. These cultures are built on trust, respect, and a commitment to excellence. The authors provide examples of companies that have successfully cultivated cult-like cultures, highlighting the positive impact it has on their long-term success.
Collins and Porras begin by explaining that a cult-like culture is formed when a set of strong core values and beliefs are deeply ingrained in every employee. This shared sense of purpose creates a sense of belonging and commitment, driving individuals to go above and beyond in their work. The authors note, “The clearest expression of the power of core ideology is a strong sense of group identification and of belonging to something special.”
To support their argument, Collins and Porras provide a quote from an executive at 3M, a renowned visionary company: “When people join 3M, they know they are joining something bigger than themselves. They join a community.“
The authors go on to highlight that cult-like cultures encourage employees to take ownership and be accountable for their work. This sense of responsibility fosters an environment of high performance and continuous improvement. Collins and Porras explain, “Cult-like cultures … generate a force that creates extreme performance pressure to maintain the cultural norms.”
To illustrate this point, the authors share an example from HP, another visionary company: “Hewlett-Packard employees readily accepted the company’s philosophy of individual responsibility for success. … They created a high-performance mental model such that anything less than outstanding performance would be considered totally unacceptable.”
Furthermore, Collins and Porras emphasize the importance of trust and respect within these cultures. Employees feel valued and empowered, leading to increased motivation and engagement. The authors state, “In visionary companies, people actually feel good about coming to work, about their work, and about the people they work with.”
To reinforce this idea, the authors reference an example from Procter & Gamble, noting that the company’s culture of respect and collaboration is deeply ingrained in its employees’ minds: “P&G people had such a strong-shared sense of values that they could walk into any situation, size up what needed to be done, and expect any member of the team to act accordingly.”
Collins and Porras conclude the chapter by emphasizing that cult-like cultures are not stagnant, but rather adaptable. These cultures evolve with the changing times while remaining true to their core values. They state, “Visionary companies … display remarkable continuity while simultaneously displaying their ability to change essential features.”
They provide an example from Walt Disney, demonstrating how the company’s cult-like culture has endured over time: “The Walt Disney Company had changed in response to the changing times and changing management, but the organization had also retained its basic philosophy over time.”
Chapter 7: “Try a Lot of Stuff and Keep What Works”
Collins and Porras discuss the importance of experimentation and innovation in this chapter. They argue that visionary companies are not afraid to try new things and take calculated risks. By constantly experimenting and learning from both successes and failures, these companies are able to stay ahead of the curve and continually improve. The authors provide examples of companies that have embraced this mindset and highlight the impact it has had on their long-term success.
One of the key quotes from this chapter is, “Visionary companies have the organizational capability to expend copious amounts of effort in experimentation – not just once, but continuously”. This quote underscores the idea that successful companies are not limited by a fear of failure, but rather embrace a mindset of continuous learning and improvement.
The authors provide an example of the grocery retailer, Kroger, to illustrate the principle of trying a lot of stuff and keeping what works. They highlight how Kroger experimented with a variety of formats and concepts before finding success with their “superstore” model, which allowed them to become one of the largest grocery chains in the United States.
Another relevant example mentioned in the book is that of Procter & Gamble (P&G) and their Innovation Centers. Collins and Porras explain how P&G created these centers to encourage experimentation and foster innovation within the company. They describe how P&G empowers employees to pursue new ideas and establish a culture of curiosity and exploration.
Furthermore, the authors discuss the importance of having a systematic process for experimentation. They stress the need for visionary companies to “create a supportive context in which experimentation can best flourish”. This includes providing resources, time, and a safe environment for employees to test new ideas and learn from both successes and failures.
Collins and Porras also highlight the idea of quick feedback loops, which allow companies to rapidly iterate and make improvements based on real-time data. They mention examples such as Hewlett-Packard and 3M, who have implemented systems that encourage a culture of experimentation and constant feedback.
Chapter 8: “Home-Grown Management”
In this chapter, Collins and Porras explore the concept of home-grown management and its importance in visionary companies. They argue that these companies develop their own leaders from within, rather than relying solely on external hires. By cultivating a strong leadership pipeline and investing in the development of their employees, these companies ensure a consistent and aligned approach to management. The authors provide examples of companies that have successfully implemented home-grown management practices and emphasize the positive impact it has on the company’s culture and long-term success.
The authors begin the chapter by emphasizing the importance of developing leaders who will have a deep understanding of the company’s culture, values, and long-term vision. They state, “Preserving the core doesn’t just mean preserving the organization’s products, services, and technologies; it also means preserving the organization’s leadership DNA.” This highlights the idea that leaders who have been nurtured internally will inherently have a better grasp of the company’s identity and are more likely to lead with alignment and purpose.
Collins and Porras provide several examples of companies that have successfully implemented home-grown management practices. One such example is Procter & Gamble (P&G), known for its strong leadership development program. The authors state, “P&G’s Home-Grown CEO program ensured a pipeline of talent that would carry forth the company’s deeply rooted culture and commitment to innovation.” By focusing on internal talent, P&G was able to create a continuous flow of leaders who embodied the company’s values and would drive its long-term success.
Another example highlighted in the book is Hewlett-Packard (HP). The authors discuss how HP’s founders, Bill Hewlett and Dave Packard, established a unique management philosophy that emphasized the development of leaders from within the organization. This philosophy, known as the “HP Way,” played a crucial role in shaping HP’s culture and guiding its management practices. Collins and Porras note, “Bill Hewlett and Dave Packard built a foundation of trust and respect, allowing capabilities to grow from the inside.” This approach resulted in a strong leadership pipeline that contributed to HP’s enduring success.
Throughout the chapter, Collins and Porras stress the benefits of home-grown management. They argue that investing in the development of internal talent fosters a sense of loyalty, commitment, and alignment with the company’s vision. The authors state, “Home-grown management often feels more ‘rooted’ in the organization’s heritage, and can anchor the company’s culture more effectively… Home-grown management helps to embed the core values and ideology deep in the organization.”
Chapter 9: “Good Enough Never Is”
Collins and Porras discuss the concept of excellence and the continuous pursuit of improvement in this chapter. They argue that visionary companies never settle for mediocrity and are constantly striving for excellence. These companies understand that the journey towards greatness is ongoing and that there is always room for improvement. The authors emphasize the importance of a strong commitment to quality and continuous learning in achieving long-term success.
One key concept discussed in this chapter of Built to Last is the idea that “good enough never is” for visionary companies. Collins and Porras explain that these companies have a deep-rooted commitment to quality and refuse to accept anything less than their best effort. They quote William McKnight, the former CEO of 3M, who said, “We must constantly increase our efforts if we’re to keep our competitors at bay. We are never good enough.” This mindset of never settling and always pushing for improvement is what sets visionary companies apart from their competitors.
The authors provide several examples of companies that embody this philosophy. One such example is Procter & Gamble (P&G), who continuously pushes the envelope in product development and innovation. P&G has a philosophy called “the relentless pursuit of new and different” and invests heavily in research and development to ensure their products are of the highest quality. They understand that the pursuit of excellence is an ongoing journey and that there is always room for improvement.
Another example mentioned in the book is 3M, who is known for their commitment to innovation and quality. Collins and Porras highlight the 3M’s “15% rule,” which encourages employees to spend 15% of their time on projects outside of their immediate responsibilities. This promotes creativity and allows employees to explore new ideas and possibilities in their pursuit of excellence.
Furthermore, the authors emphasize the importance of a strong commitment to continuous learning in achieving long-term success. They state, “Visionary companies are learning machines.” These companies have a culture that encourages continuous improvement through learning from both successes and failures. They are not afraid to take risks and view failures as opportunities for growth. Collins and Porras provide examples of companies like IBM and HP, who have successfully embraced a learning mindset and continually reinvented themselves to stay at the forefront of their industries.
Chapter 10: “Preserve the Core/Stimulate Progress”
In the final chapter of “Built to Last,” Collins and Porras bring together all of the concepts discussed throughout the book. They emphasize that visionary companies strike a balance between preserving their core values and purpose, while also stimulating progress and innovation. These companies have a long-term perspective and understand that change is inevitable, but they remain true to their identity throughout the process. The authors highlight the power of visionary thinking and its ability to create a lasting impact in the business world.
Collins and Porras emphasize the importance of grounding a company’s actions and decisions in its core values and purpose. They state, “Visionary companies distinguish their timeless core values and enduring purpose (which should never change) from their strategic and operating practices (which should be changing constantly in response to a changing world)”. By keeping their core values at the forefront, these companies maintain a sense of identity and direction.
At the same time, visionary companies are not resistant to change or innovation. They understand that progress is essential for survival and growth. Collins and Porras highlight this by stating, “Keeping the faith while stimulating progress requires an ability to embrace both continuity and change, to preserve the principles underlying core ideology and still encourage new ideas and practices”.
The authors provide several examples of companies that embody this balance between preservation and progress. One notable example is 3M, which has a rich history of innovation and a commitment to continuous improvement. The authors write, “3M, in its evolution from a mining company to a sandpaper manufacturer to an innovation dynamo, has preserved its core commitment to innovation by stimulating and rewarding progress within the boundaries of its principles and core values“. This demonstrates how 3M has successfully adapted while remaining true to its core values.
Another example is Hewlett-Packard (HP), which has a strong focus on its core ideology of “The HP Way.” Despite facing numerous challenges over the years, HP has managed to preserve its core values while embracing change. The authors note, “While Hewlett-Packard has constantly renewed itself to meet new market realities, it has also preserved its unique ‘HP Way’… HP creates adaptation by building from its core ideology, not by changing it or adding to it”.
Collins and Porras also highlight Merck as an example of a company that successfully balances preservation and progress. They explain, “Merck has preserved its Core Purpose of saving and improving lives while stimulating progress through new drugs introduced to meet changing market needs”. This demonstrates how Merck has maintained its focus on its core purpose while continuously innovating to address evolving societal needs
Samrat is a Delhi-based MBA from the Indian Institute of Management. He is a Strategy, AI, and Marketing Enthusiast and passionately writes about core and emerging topics in Management studies. Reach out to his LinkedIn for a discussion or follow his Quora Page