QD: How did you arrive at your list of 12 shattered myths about business?[see sidebar] Were these ideas that you applied to your research, or did you find them as you went along? Collins: One of the tests of really good research is that you find things you didn’t expect. And one of the tests of great research is you find things you don’t even like. We found both. At least half of the myths were surprises to me, and a couple of them I flat-out am disappointed with. QD: Give us an example of one of them. Collins: The fact that it doesn’t really matter what values you have, as long as you have core values, is a very disturbing finding to me. I would love to be able to say companies that have a deep respect for the individual will prosper over time as enduring, great companies, but the evidence doesn’t bear that out. No matter what core value you give me, I can show you a great company that doesn’t hold it as a core value. We found that the values’ strength and clarity, and a company’s consistency and alignment with them, is what really matters. It’s a value-neutral view, which -- as a values-driven guy -- I find difficult to swallow, but the evidence clearly leads me to that conclusion. I can’t ignore it. I was extraordinarily surprised that our study’s visionary companies got off to, if anything, worse starts in life. Going into the study, I would have predicted better entrepreneurial roots for them. In fact, the less successful companies -- our comparison companies -- had better starts in life. That, to me, was a big surprise, having taught entrepreneurship and believed in the importance of a great idea, which this finding shattered. Another thing I found disturbing and wasn’t looking for was the cult-like cultures, environments where those who don’t share the values are ejected like viruses. One of my students from communist China said to me, “This reminds me of how the communist regime does things.” It was a disturbing insight that rang far too true to ignore. One other finding that really surprised me but that I found delightful was the idea that companies that improve over time do so with insiders. QD: Some of these visionary companies started without an idea. Do you have any insight as to why jumping in worked for them? Collins: Let me relate a personal story to explain why I think it worked. Between the time I graduated from business school and returned to teaching, I started a company. I launched it on a shoestring. Ultimately, I abandoned the business because I made the terrible mistake of equating my company’s success with the success of my business, and they are different. If our business ideas aren’t as successful as we’d like, as mine wasn’t, then we say the company has failed. Whereas Hewlett and Packard would say, “So our first product failed, our second product failed, our third product failed, our fourth product failed. We’re not going to stop the company. We’ll just keep trying ideas until something works.” Applying persistence not to an idea but to a company, and willingly changing the ideas until you find some combination that works, is an enormously powerful way to go about an entrepreneurial adventure. QD: The Malcolm Baldrige National Quality Award has honored a few of the companies you’ve listed as visionary. Do quality processes inevitably go along with visionary companies? Collins: Among the popular management trends during the last 20 to 30 years, total quality management, more than any other, is supported in the timeless notion of great companies. Today’s TQM principles were, in one form or another, in place at most of these companies throughout their histories. People ask, “Is the corporate quality movement a fad?” My answer, based on the historical perspective, is, “If it’s a fad, it’s been one for something on the order of 200 years.” Companies that embrace TQM in the best way put the fundamental drive and spirit behind it first, and then they reinforce it with the powerful mechanisms and processes imbedded in the Baldrige process. Just having the mechanisms, processes and tools without the underlying drive and spirit doesn’t work particularly well. I’m firmly convinced that pursuing the Baldrige Award and total quality processes, tools and mechanisms is a positive based on our research -- more so than any other set of management tools I’ve seen. QD: How do you think the visionary companies have been affected by people like Peter Drucker, W. Edwards Deming and Joseph Juran? Collins: I think the third founder of Hewlett-Packard was Peter Drucker. He never interacted with the company, but Packard read from The Practice of Management like a bible. And, of course, a number of the companies in our study were influenced in later decades by both Deming and Juran. The interesting thing about Deming, Juran and Drucker is that they stand, not entirely alone, but apart from management hucksters as solid thinkers who brought sound quality management fundamentals to organizations. QD: Do you think some of these visionary companies unwittingly introduced the quality movement, and that people like Deming, Drucker and Juran actually codified it? Collins: That’s more the case. But, at the same time, Deming and Juran not only codified and articulated it but also brought forth a set of tools that others could apply, so that people could take that underlying drive for continuous improvement and more effectively harness it. The whole concept surrounds statistical quality control and the fundamental understanding behind it -- that of random variation and what it really means to manage randomness into a controlled state without ever removing randomness. Those key ideas are not entirely new, but they were not particularly well- developed or widely understood until Drucker and Juran successfully taught legions of managers how to think that way. QD: Did you find ideological trailblazing to be a conscious or unconscious part of these companies’ processes? Collins: We found it to be highly conscious. If we go inside these companies and trace their historical development, there’s a significant emphasis on things like value statements and vision, in some cases as early as the 1800s. That’s one of the strongest -- probably the strongest -- finding in our research. And out of this flows the idea of cult-like cultures. Companies like Motorola, 3M and HP are all great companies, but they have very strong cultures that grow out of their consciously cultivated ideologies. In Motorola’s case, it’s an ideology centered around applied technology and continuous renewal. At 3M it’s innovation, and at HP it’s the notion of a social institution providing technical contributions. These are ideological tenets, not strategies. There’s an absolutely fundamental difference. A business strategy may change over time, whereas an ideology is something a company holds to even though the world is changing around it. QD: How can visionary leadership be pushed down into middle management? Collins: These ideas apply at any level of responsibility or in any size organization. You can even apply them to yourself as an individual, just as you can the spirit of continuous improvement and the mechanisms of personal quality development. I know that because I’ve seen it done, and because I’ve done it myself. QD: Many people are embracing the findings you offer, which sometimes contradict accepted business teachings. Do you think this acceptance is pointing us toward a new era in business and leadership? Collins: This may indicate heading toward a new era, but we’re getting there, paradoxically, by looking far back into the past. In terms of progress, I think the world works as a bell curve that’s always moving to the right. The people who built these companies were ahead of their time at the front end of the curve. Now the rest of the bell curve is catching up, and it will just keep moving to the right. An organization rooted in deeply held values is a very human idea. Many of us have spent our lives working very hard, and we’ve never really resolved fundamental existential questions such as “What’s the point?” Most of us need some sense of our work having a point. There’s something deeply appealing about creating something -- anything -- that’s built to last. |
