Building Your Company’s Visionby Ja

Building Your Company’s Vision



by James C. Collins and Jerry I. Porras


























Harvard Business Review
Reprint 96501





Harvard Business Review



SEPTEM BER- OCTOBER 1996

Re print N umb e r
JAMES C. COLLINS AND JERRY I. PORRAS BU ILD I N G Y O UR CO M PA N Y ’ S V ISIO N 96501
DAVID A. THOMAS AND ROBIN J. ELY M AK I N G D IFFERENCES M ATTER: A NEW PARAD IG M FOR M A N AG I N G D I VERSITY 96510
ANN MAJCHRZAK
AND QIAN WEI WANG BREAK I N G THE FU NCTIO N AL M I N D - SET I N PROCESS ORGA N I Z ATIO NS 96505
N. CRAIG SMITH, ROBERT J. THOMAS, AND JOHN A. QUELCH A STRATEGIC APPRO ACH TO M A N AG I N G PRO DUCT RECALLS 96506
RICHARD B. FREEMAN TO WARD A N APARTHEI D ECO N O M Y? 96503
W ITH CO MM ENTARIES BY: ROBERT B. REICH , JOSH S. WESTO N,
JO H N S W EENEY, W ILLI A M J. MCD O N O UGH , A N D JO H N M UELLER
GEORGE STALK, JR., DAVID K. PECAUT, AND BENJAMIN BURNETT BREAK I N G CO M PRO M ISES, BREAKA WAY GRO W TH 96507
JOHN STRAHINICH HBR CASE STUDY
THE PITFALLS OF PARENTI N G M ATURE CO M PA N IES
96508
BARBARA E. TAYLOR, RICHARD P. CHAIT, AND THOMAS P. HOLLAND SOCIAL ENTERPRISE
THE NEW W ORK OF THE N O NPROFIT BO ARD

96509
THOMAS DONALDSON W ORLD VIEW
VALUES I N TENSIO N : ETH ICS AWAY FRO M H O ME

96502
JAMES P. W OMACK
AND DANIEL T. JONES IDEAS AT W ORK
BEY O N D TO Y OTA: H O W TO ROO T O UT WASTE A N D

96511
PURSUE PERFECTIO N
MARC LEVINSO N BOOKS IN REVIEW
CAPITALIS M W ITH A SAFETY NET?

96504

HSEPTEMBERB-OCTOBRER 1996























by James C. Collins and Jerry I. Porras



We shall not cease from exploration And the end of all our exploring Will be to arrive where we started
And know the place for the first time.

T.S. Eliot, Four Quartets

Companies that enjoy enduring success have core values and a core purpose that remain fixed while their business strategies and practices end-

tions its structure and revamps its processes while preserving the ideals embodied in its credo. In 1996, 3M sold off several of its large mature businesses – a dramatic move that surprised the business press – to refocus on its enduring core purpose of solving unsolved problems innovatively. We studied com- panies such as these in our research for Built to Last: Successful Habits of Visionary Companies and found that they have outperformed the general stock market by a factor of 12 since 1925.

lessly adapt to a changing world. The dynamic of

preserving the core while stimulating progress is the reason that companies such as Hewlett- Packard, 3M, Johnson & Johnson, Procter & Gam- ble, Merck, Sony, Motorola, and Nordstrom be- came elite institutions able to renew themselves and achieve superior long-term performance. Hewlett-Packard employees have long known that radical change in operating practices, cultural norms, and business strategies does not mean los- ing the spirit of the HP Way – the company’s core principles. Johnson & Johnson continually ques-

James C. Collins is a management educator and writer based in Boulder, Colorado, where he operates a man- agement learning laboratory for conducting research and working with executives. He is also a visiting profes- sor of business administration at the University of Vir- ginia in Charlottesville. Jerry I. Porras is the Lane Profes- sor of Organizational Behavior and Change at Stanford University’s Graduate School of Business in Stanford, California, where he is also the director of the Executive Program in Leading and Managing Change. Collins and Porras are coauthors of Built to Last: Successful Habits of Visionary Companies (HarperBusiness, 1994).


HARVARD BUSINESS REVIEW September-October 1996 Copyright © 1996 by James C. Collins and Jerry I. Porras. All rights reserved.

VISION


Truly great companies understand the difference between what should never change and what should be open for change, between what is gen- uinely sacred and what is not. This rare ability to manage continuity and change – requiring a con- sciously practiced discipline – is closely linked to the ability to develop a vision. Vision provides guid- ance about what core to preserve and what future to stimulate progress toward. But vision has become one of the most overused and least understood words in the language, conjuring up different im- ages for different people: of deeply held values, out- standing achievement, societal bonds, exhilarating goals, motivating forces, or raisons d’être. We rec- ommend a conceptual framework to define vision, add clarity and rigor to the vague and fuzzy con- cepts swirling around that trendy term, and give practical guidance for articulating a coherent vision within an organization. It is a prescriptive frame- work rooted in six years of research and refined and tested by our ongoing work with executives from a great variety of organizations around the world.
A well-conceived vision consists of two major components: core ideology and envisioned future. (See the exhibit “Articulating a Vision.”) Core ide- ology, the yin in our scheme, defines what we stand for and why we exist. Yin is unchanging and com- plements yang, the envisioned future. The envi- sioned future is what we aspire to become, to achieve, to create – something that will require sig- nificant change and progress to attain.

Core Ideology
Core ideology defines the enduring character of an organization – a consistent identity that tran- scends product or market life cycles, technological breakthroughs, management fads, and individual leaders. In fact, the most lasting and significant contribution of those who build visionary com- panies is the core ideology. As Bill Hewlett said about his longtime friend and busi-
ness partner David Packard upon

company exists to make technical contributions for the advancement and welfare of humanity. Compa- ny builders such as David Packard, Masaru Ibuka of Sony, George Merck of Merck, William McKnight of 3M, and Paul Galvin of Motorola understood that it is more important to know who you are than where you are going, for where you are going will change as the world around you changes. Leaders die, products become obsolete, markets change, new technologies emerge, and management fads come and go, but core ideology in a great company endures as a source of guidance and inspiration.
Core ideology provides the glue that holds an organization together as it grows, decentralizes, di- versifies, expands globally, and develops workplace diversity. Think of it as analogous to the principles of Judaism that held the Jewish people together for centuries without a homeland, even as they spread throughout the Diaspora. Or think of the truths held to be self-evident in the Declaration of Inde- pendence, or the enduring ideals and principles of the scientific community that bond scientists from every nationality together in the common purpose of advancing human knowledge. Any effective vi- sion must embody the core ideology of the organi- zation, which in turn consists of two distinct parts: core values, a system of guiding principles and tenets; and core purpose, the organization’s most fundamental reason for existence.
Core Values . Core values are the essential and en- during tenets of an organization. A small set of timeless guiding principles, core values require no external justification; they have intrinsic value and importance to those inside the organization. The Walt Disney Company’s core values of imagination and wholesomeness stem not from market require- ments but from the founder’s inner belief that imagination and wholesomeness should be nur- tured for their own sake. William Procter and James Gamble didn’t instill in P&G’s culture a focus on product excellence merely as a strategy for success

Packard’s death not long ago, “As far as the company is concerned, the greatest thing he left behind him was a code of ethics known as the HP Way.” HP‘s core ideology, which has guided the company since its incep- tion more than 50 years ago, includes

Core ideology provides the glue
that holds an organization together through time.

a deep respect for the individual, a dedication to af- fordable quality and reliability, a commitment to community responsibility (Packard himself be- queathed his $4.3 billion of Hewlett-Packard stock to a charitable foundation), and a view that the

but as an almost religious tenet. And that value has been passed down for more than 15 decades by P&G people. Service to the customer – even to the point of subservience – is a way of life at Nordstrom that traces its roots back to 1901, eight decades before





Articulating a Vision



Core Ideology
# Core values
# Core purpose






Envisioned Future
# 10-to-30-year BHAG
(Big, Hairy, Audacious Goal)
# Vivid description

customer service programs became stylish. For Bill Hewlett and David Packard, respect for the individ- ual was first and foremost a deep personal value; they didn’t get it from a book or hear it from a man- agement guru. And Ralph S. Larsen, CEO of John- son & Johnson, puts it this way: “The core values embodied in our credo might be a competitive advantage, but that is not why we have them. We have them because they define for us what we stand for, and we would hold them even if they became a competitive disadvantage in certain situations.” The point is that a great company decides for itself what values it holds to be core, largely inde- pendent of the current environment, competitive requirements, or management fads. Clearly, then, there is no universally right set of core values. A company need not have as its core value cus- tomer service (Sony doesn’t) or respect for the indi- vidual (Disney doesn’t) or quality (Wal-Mart Stores doesn’t) or market focus (HP doesn’t) or teamwork (Nordstrom doesn’t). A company might have oper- ating practices an

Kết quả (Việt) 1:

Xây dựng tầm nhìn của công ty bạnbởi James C. Collins và Jerry I. Porras Harvard Business ReviewIn lại 96501 Harvard Business ReviewSEPTEM BER-THÁNG 10 NĂM 1996 Tái in N umb e rJAMES C. COLLINS VÀ JERRY I. PORRAS BU ILD TÔI N G Y O UR CO M PA N Y V ISIO N 96501 DAVID A. THOMAS VÀ ROBIN J. ELY M AK TÔI N G D IFFERENCES M ATTER: MỘT MỚI PARAD IG M CHO M A N AG TÔI N G D TÔI VERSITY 96510 ANN MAJCHRZAKVÀ QIAN WEI WANG PHÁ VỠ TÔI N G FU NCTIO N AL M TÔI N D - THIẾT LẬP TÔI N QUÁ TRÌNH ORGA N TÔI Z ATIO NS 96505 N. CRAIG SMITH, ROBERT J. THOMAS, VÀ JOHN A. QUELCH A CHIẾN LƯỢC APPRO ACH M N AG TÔI N G PRO ỐNG THU HỒI 96506 RICHARD B. FREEMAN ĐỂ PHƯỜNG Y M N APARTHEI D ECO N O? 96503 W ITH CO MM ENTARIES BỞI: ROBERT B. REICH, JOSH S. WESTO N, JO H N S W EENEY, W ILLI MỘT M J. MCD O N O UGH, MỘT N D JO H N M UELLERGEORGE CUỐNG, JR., DAVID K. PECAUT, VÀ BENJAMIN BURNETT PHÁ VỠ TÔI N G CO M PRO M ISES, BREAKA CÁCH GRO W TH 96507 JOHN STRAHINICH HBR TRƯỜNG HỢP NGHIÊN CỨUNHỮNG CẠM BẪY CỦA PARENTI N G M ATURE CO M PA N IE 96508 BARBARA E. TAYLOR, RICHARD P. CHAIT VÀ THOMAS P. HOLLAND DOANH NGHIỆP XÃ HỘIORK W MỚI CỦA N O NPROFIT BO ARD 96509 THOMAS DONALDSON W ORLD VIEWCÁC GIÁ TRỊ TÔI N TENSIO N: ETH ICS ĐI FRO M H O TÔI 96502 JAMES P. W OMACKVÀ DANIEL T. JONES Ý TƯỞNG TẠI W ORKBEY O N D ĐỂ Y OTA: H O W ĐỂ ROO T O UT LÃNG PHÍ MỘT D N 96511 THEO ĐUỔI PERFECTIO N MARC LEVINSO N SÁCH TRONG BÀI ĐÁNH GIÁM CAPITALIS W ITH MỘT MẠNG LƯỚI AN TOÀN? 96504 HSEPTEMBERB-OCTOBRER 1996by James C. Collins and Jerry I. Porras We shall not cease from exploration And the end of all our exploring Will be to arrive where we startedAnd know the place for the first time.T.S. Eliot, Four QuartetsCompanies that enjoy enduring success have core values and a core purpose that remain fixed while their business strategies and practices end- tions its structure and revamps its processes while preserving the ideals embodied in its credo. In 1996, 3M sold off several of its large mature businesses – a dramatic move that surprised the business press – to refocus on its enduring core purpose of solving unsolved problems innovatively. We studied com- panies such as these in our research for Built to Last: Successful Habits of Visionary Companies and found that they have outperformed the general stock market by a factor of 12 since 1925. lessly adapt to a changing world. The dynamic of preserving the core while stimulating progress is the reason that companies such as Hewlett- Packard, 3M, Johnson & Johnson, Procter & Gam- ble, Merck, Sony, Motorola, and Nordstrom be- came elite institutions able to renew themselves and achieve superior long-term performance. Hewlett-Packard employees have long known that radical change in operating practices, cultural norms, and business strategies does not mean los- ing the spirit of the HP Way – the company’s core principles. Johnson & Johnson continually ques-
James C. Collins is a management educator and writer based in Boulder, Colorado, where he operates a man- agement learning laboratory for conducting research and working with executives. He is also a visiting profes- sor of business administration at the University of Vir- ginia in Charlottesville. Jerry I. Porras is the Lane Profes- sor of Organizational Behavior and Change at Stanford University’s Graduate School of Business in Stanford, California, where he is also the director of the Executive Program in Leading and Managing Change. Collins and Porras are coauthors of Built to Last: Successful Habits of Visionary Companies (HarperBusiness, 1994).


HARVARD BUSINESS REVIEW September-October 1996 Copyright © 1996 by James C. Collins and Jerry I. Porras. All rights reserved.

VISION


Truly great companies understand the difference between what should never change and what should be open for change, between what is gen- uinely sacred and what is not. This rare ability to manage continuity and change – requiring a con- sciously practiced discipline – is closely linked to the ability to develop a vision. Vision provides guid- ance about what core to preserve and what future to stimulate progress toward. But vision has become one of the most overused and least understood words in the language, conjuring up different im- ages for different people: of deeply held values, out- standing achievement, societal bonds, exhilarating goals, motivating forces, or raisons d’être. We rec- ommend a conceptual framework to define vision, add clarity and rigor to the vague and fuzzy con- cepts swirling around that trendy term, and give practical guidance for articulating a coherent vision within an organization. It is a prescriptive frame- work rooted in six years of research and refined and tested by our ongoing work with executives from a great variety of organizations around the world.
A well-conceived vision consists of two major components: core ideology and envisioned future. (See the exhibit “Articulating a Vision.”) Core ide- ology, the yin in our scheme, defines what we stand for and why we exist. Yin is unchanging and com- plements yang, the envisioned future. The envi- sioned future is what we aspire to become, to achieve, to create – something that will require sig- nificant change and progress to attain.

Core Ideology
Core ideology defines the enduring character of an organization – a consistent identity that tran- scends product or market life cycles, technological breakthroughs, management fads, and individual leaders. In fact, the most lasting and significant contribution of those who build visionary com- panies is the core ideology. As Bill Hewlett said about his longtime friend and busi-
ness partner David Packard upon

company exists to make technical contributions for the advancement and welfare of humanity. Compa- ny builders such as David Packard, Masaru Ibuka of Sony, George Merck of Merck, William McKnight of 3M, and Paul Galvin of Motorola understood that it is more important to know who you are than where you are going, for where you are going will change as the world around you changes. Leaders die, products become obsolete, markets change, new technologies emerge, and management fads come and go, but core ideology in a great company endures as a source of guidance and inspiration.
Core ideology provides the glue that holds an organization together as it grows, decentralizes, di- versifies, expands globally, and develops workplace diversity. Think of it as analogous to the principles of Judaism that held the Jewish people together for centuries without a homeland, even as they spread throughout the Diaspora. Or think of the truths held to be self-evident in the Declaration of Inde- pendence, or the enduring ideals and principles of the scientific community that bond scientists from every nationality together in the common purpose of advancing human knowledge. Any effective vi- sion must embody the core ideology of the organi- zation, which in turn consists of two distinct parts: core values, a system of guiding principles and tenets; and core purpose, the organization’s most fundamental reason for existence.
Core Values . Core values are the essential and en- during tenets of an organization. A small set of timeless guiding principles, core values require no external justification; they have intrinsic value and importance to those inside the organization. The Walt Disney Company’s core values of imagination and wholesomeness stem not from market require- ments but from the founder’s inner belief that imagination and wholesomeness should be nur- tured for their own sake. William Procter and James Gamble didn’t instill in P&G’s culture a focus on product excellence merely as a strategy for success

Packard’s death not long ago, “As far as the company is concerned, the greatest thing he left behind him was a code of ethics known as the HP Way.” HP‘s core ideology, which has guided the company since its incep- tion more than 50 years ago, includes

Core ideology provides the glue
that holds an organization together through time.

a deep respect for the individual, a dedication to af- fordable quality and reliability, a commitment to community responsibility (Packard himself be- queathed his $4.3 billion of Hewlett-Packard stock to a charitable foundation), and a view that the

but as an almost religious tenet. And that value has been passed down for more than 15 decades by P&G people. Service to the customer – even to the point of subservience – is a way of life at Nordstrom that traces its roots back to 1901, eight decades before





Articulating a Vision



Core Ideology
# Core values
# Core purpose






Envisioned Future
# 10-to-30-year BHAG
(Big, Hairy, Audacious Goal)
# Vivid description

customer service programs became stylish. For Bill Hewlett and David Packard, respect for the individ- ual was first and foremost a deep personal value; they didn’t get it from a book or hear it from a man- agement guru. And Ralph S. Larsen, CEO of John- son & Johnson, puts it this way: “The core values embodied in our credo might be a competitive advantage, but that is not why we have them. We have them because they define for us what we stand for, and we would hold them even if they became a competitive disadvantage in certain situations.” The point is that a great company decides for itself what values it holds to be core, largely inde- pendent of the current environment, competitive requirements, or management fads. Clearly, then, there is no universally right set of core values. A company need not have as its core value cus- tomer service (Sony doesn’t) or respect for the indi- vidual (Disney doesn’t) or quality (Wal-Mart Stores doesn’t) or market focus (HP doesn’t) or teamwork (Nordstrom doesn’t). A company might have oper- ating practices an