Say It Ain't So, Jim!

The cover story in the Boston Globe "Ideas" section yesterday attacked the value and validity of the most popular business books, as always taking Bob Waterman, Jim Collins, and me to task. I agree with some of the charges leveled, and disagree with others. But there is one substrata of argument that I take near violent exception to. Namely, that Bob and I, at least, were purporting to provide a complete success prescription, based on flawless accumulation of data, which managers should follow like the Ten Commandments—or eight, in our case.

(1) What utter hogwash!
(2) What an insult to our readers!

In Search of Excellence was what it was and wasn't what it wasn't. And it surely never meant to challenge or displace the Holy Bible, Koran, Torah, etc.

Here's the story in brief:

(1) American companies were being roughed up by the Japanese in the late '70s—the first post-War II challenge to American business supremacy.
(2) A couple of Harvard B-school professors, Bill Abernathy and Bob Hayes, put the blame largely on our management practices, as taught at their school, among others. In "Managing Our Way to Economic Decline" in the Harvard Business Review, they argued that we [Americans] were paying too much attention to the numbers, not enough to the "basics" such as product quality—sound familiar?
(3) Bob Waterman and I, resident in another blameworthy institution, McKinsey & Co., agreed 100%. But rather than follow the habit of the moment—urge Americans to adopt, lock, stock, and barrel, Japanese management practices—we imagined that there must be some Western-American businesses that still worked (we subsequently labeled them the "saving remnant").
(4) Bob and I sought out expert advice in the USA and Europe and got a ton of nominations. IBM topped the list, which also included the likes of HP, Johnson & Johnson, Disney, McDonald's, Intel, and Wal*Mart. Incredibly (as viewed from today), almost nobody had examined these firms! Fact was that the likes of the B-schools only examined failures at the time—we were about the first to look at successes. (About which, incidentally, the Globe author is clueless, attacking us for what was—in 1980, and everything must be viewed in context—our primary useful point of difference; namely, surfacing successful examples. We were the business equivalent of Abraham Maslow's approach to psychology; Maslow de facto invented "positive psychology," arguing that we also have to study healthy people—not just sick people, as professional psychologists were wont to do pre-Maslow.)
(5) Bob and I and our colleague David Anderson then went off and interviewed like maniacs for several months—mostly folks "down the line," rather than CEOs—this was another break from the regnant "research" tradition of the B-schools and consultancies. Based on those interviews and our extensive literature research, academic and popular, we reached some tentative conclusions. Key phrase: "tentative conclusions." Dear God in heaven, we never imagined for a moment, nor a second, or a micro-, nano-, or pico-second that we were performing research in the physical sciences from which we would extract definitive solutions along the lines of a theory of planetary movement or the effects of gravitational forces on the bending of light! We looked at a ton of interview data, had a ton of discussions, "tested" our conclusions in literally hundreds of seminars, and concluded, very un-scientifically, that "this looks pretty good"—and that doesn't. This approach was made clear as a bell to anyone who came across our stuff.
(6) About five years after the research started, with America mired in its worst recession since the Great Depression (sound familiar, redux?), we published In Search of Excellence. Unlike Peter Drucker, who avoided storytelling and naming names like the plague, we named names and told stories—and they resonated with a bushel of readers. Incidentally, along the way we dumped about 60%, I'd guess, of the originally nominated companies because we deemed their long-term financial performance to have been inadequate—using some pretty common measures and the prior 20 years' data. There was no rocket science here either—just a "sensible" approach to confirming that we were talking about some pretty good performers. Incidentally, it drives our critics nuts that our surviving companies, indeed experiencing ups and downs (duh!), have apparently continued to perform very well—a 2002 Forbes analysis, performed on the book's 20th birthday, concluded that an "excellence index" based on a basket of "our" companies' stocks had handily outperformed the Dow and S&P 500; given the date, 2002, this encompassed the dotcom boom and bust.

The above is not meant to be a "defense"—to the contrary! I repeat: In Search of Excellence was what it was and wasn't what it wasn't. I'd call it "useful"—and very different from its predecessors in an apparently useful way. Namely, to repeat, (1) about successful rather than unsuccessful companies and (2) loaded with practical stories. I suppose that instead of calling our generic conclusions, around which the book was structured, "eight basics," we could have called them "eight tentative conclusions" or "eight pretty good ideas."

The far more important point is—and this has apparently eluded 100% of our critics: Our readers are not idiots! They are pragmatic businesspeople or managers in the public sector or, pastors or priests or football coaches—the essence of the practice of management in all of these disciplines is indeed pragmatism! That is, our book (and others like it) do not appear in the "religion" section of the book store with the Bible on one side and the Koran on the other. Businesspeople, and police chiefs and fire chiefs and public works directors and elementary school principals, are neither looking for Biblical guidance nor full-blown academic theories of the Einsteinian or Darwinian or Newtonian sort. The are looking for ... "a couple of good ideas" they can use now. They are far more capable than Bob Waterman or I or Gary Hamel or Warren Bennis or Rosabeth Moss Kanter of deciding what's worth trying and what's not in their peculiar context—and when to start trying whatever and when to stop.

And, indeed, for thirty years or so now I, at least, have been trying to provide "a few useful ideas that you can get started on this afternoon."

I am being a bit disingenuous, I admit. There is a "constant undertone" to my thirty years of work. I'd call it that, a "constant undertone," not a Unified Theory of Everything. That is, I stood—and stand—behind the likes of (1) being and staying in touch with reality (MBWA, or Managing By Wandering Around, which Bob W and I found at HP in 1978), (2) putting people first (the likes of Dana Corp and Wal*Mart '78, Southwest Airlines today), (3) innovation through decentralization (3M, J&J then and now), (4) staying close to your customer (IBM then and now—with a few hiccups in between), (5) core values (the likes of McDonald's and W.L. Gore—Bob and I loved Ray Kroc's "QSCV," Quality, Service, Cleanliness, and Value, at McDonald's) and (6) doing now instead of talking forever (3M and HP were masters in '78).

Oh yeah, and the most important one of all: (7) Excellence per se! Bob and I may have been about the first to suggest that "excellence" ought to be as much an aspiration for businessmen as for would-be Olympians. That was our "ardent belief"—and did not in any way pretend to be "teased from the data." "Excellence" was, is, and shall ever be totally subjective! And the notion, I'm delighted to say, seemed to have resonated then—and resonates now.

I'm willing to stake any modest usefulness of my career on the "usefulness" of these seven ideas, and a few more that are absent courtesy space constraints. And stake any modest usefulness, far more important, on having listened to and then done my best to share some terrific stories told to me by the likes of Bill and Vieve Gore of W.L. Gore, Frank McGuire of FedEx, Herb Kelleher at Southwest Airlines, or Master Educator Dennis Littky.

There you have it.

But not quite.

I must inject one sour—and sad—note. Jerry Porras and Jim Collins are pals and colleagues of mine. I think Built to Last was a terrific book with a ton of those "pretty good ideas" between the covers. (Though I don't really like the idea of merely "lasting" as an aspiration—but that's just me.) Likewise, I think Jim's Good to Great is terrific—loaded with "pretty good ideas" that are of immediate use. (Though again I have nitpicks.) But Jim and I are on absolutely opposite sides of the fence, indeed the universe, on two things he wrote or apparently said to the Globe guy. I went out of my way repeatedly to say to the Globe reporter: "The 'research' represented by the In Search of Excellence 'product' should never, ever be confused by the research-experimentation performed to confirm Einstein's theory of relativity. That is not nor will it ever be the standard in the so-called 'social sciences.'" In fact I added that I was one of the ones who think it's a travesty to award a Nobel in economics—economics ain't physics either, as you'll discover when you next check the status of your 401(k). Well, Mr Collins apparently disagrees! Not only does he compare his [note the italics] research to physics, but he also claims to have discovered "immutable laws of organized human performance."

Dear God!
Or, rather, God help us.

Alas, with those claims, I'm afraid Jim gives the Globe writer a boost beyond the fellow's wildest dreams! If "we"-the-gurus [I despise that moniker, by the way] think we are in the business of discovering and propagating "immutable laws," then we deserve all the opprobrium of the Globe writer, the rest of our critics, and our readers-customers.

As I said, Dear God!

NB: I have no desire to defend In Search of Excellence—the fact that some people are still pissed off about its success 27 years later is good enough for me! I am writing this almost entirely because of my irritation with Mr. Collins.

Tom Peters posted this on April 13, 2009, in Excellence.
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