We can learn much from the businesses commonly known as the visionary companies. These enterprises are recognized as forerunners by the businesses in their field and take pride in continuing achievements. In addition, visionary companies continue to succeed while the leading businesses leave and the once-popular goods go out of trend.
In order to gain adequate knowledge and experience from visionary companies, a number of distinguished executives have been looked into and the businesses that fit into the category have been determined. The research focused on 18 companies that were the most popular, including the highly esteemed Marriott Hotels, Merck, and the Walt Disney Company. It created the combinations of the visionary companies and their analogues, the businesses producing the same goods on similar markets yet named visionary not as frequently as their counterparts in the study of executives though being considered fairly successful.
Afterward, the company pairings were studied regarding their continued existence and it was determined that both types of businesses had been generally created in the 1890s. Using a vast load of information gathered from the surveys, financial records, annals, periodicals, and other data materials, every feature of these enterprises was considered, including the organization type and values.
The following example provides a deeper insight into the unprecedented achievements of the visionary companies: the investments of one dollar in their shares in the 1920s would bring more than $6,000 by the year of 1990. The astounding accomplishments of the visionary companies can also be illustrated by contrasting the investments of approximately $900 in the comparison companies and the investment of about $400 in the general market.
Unsurprisingly, various Fortune 500 companies have demonstrated considerable interest in the results of this research.
The lasting achievements of visionary companies can provide invaluable experience.
Visionary companies may be compared to the ever working factories that create outstanding goods and leaders.
A visionary companys achievements do not rely on big thoughts and theories, contrary to popular opinion.
For instance, Sonys founder did not have a particular concept of what his company would manufacture. In fact, having created the enterprise, he pooled all of his ideas about sweet bean paste and mini golf gear to find the one worth acting on.
Furthermore, the founders of Hewlett-Packard (HP), Bill Hewlett and Dave Packard did not have a certain vision of their business either at first. In the beginning, their ideas varied from foul-line indicators for bowling to automatic urinal flushers among other unconventional innovations.
Therefore, an awesome concept or theory is not a must for a visionary company to appear.
The same goes for charming, prominent leaders. It is true that visionary companies often had great managers of executives, but those people usually proved to be humble, practical, and cautious individuals.
Yet, to what do they owe their considerable achievements? What is the reason then behind their analogues failing to compete with the visionary companies despite having big ideas and effective management?
The visionary companies in focus chose to concentrate on developing themselves into the prominent businesses that produce strong leaders and big ideas instead of devoting their effort to the one particular product or leader. In fact, the main achievement of the creators of the enterprise was not the goods but the company itself because such a company would be independent of the founders or new theories and would manage to grow on its own.
Take a watch, for example. When you catch a glimpse and learn the time in that particular moment, it is like you have a good concept and one creative leader. However, if you construct a durable watch for yourself, you will be able to tell time at any moment in the future. That is similar to creating a visionary company that would be self-sufficient in terms of creating new concepts and effective executives.
Visionary companies may be compared to the ever working factories that create outstanding goods and leaders.
Despite being focused more on their basic beliefs rather than gains, visionary companies succeed nevertheless.
The goal of visionary companies is something more than a simple money earning. The combination of this goal and the principles of the enterprise that influence their choices define their basic beliefs: a number of fixed regulations, to which the company always adheres, just like in the case of the American Declaration of Independence and the truths.
For instance, Johnson & Johnson (J&J) can serve as a good example. Its CEO, Robert W. Johnson Jr., defined the companys basic beliefs and principles in 1935 and titled them Our Credo, which described the companys duties to their clients, to their workers, and to others. The last ones on this list were the owners of the company, who should have fair return after carrying out their duties to other parties.
Similarly, the visionary companies under discussion were mainly uninterested in profit. Still, though some beliefs may appear too optimistic and simple, visionary companies succeed in remaining practical when solving business-related problems and earning revenue while staying true to their principles at the same time.
Having certain beliefs is equally important for a visionary company when it is successful and when it undergoes major upheavals. Going through a serious crisis in the 1980s, the executives of Ford Motor Company, for instance, chose to determine the companys values and support the vision of the founder, Henry Ford. In contrast, their competitor, General Motors, did not follow Fords example.
While all visionary companies in focus had certain beliefs, their ideas differed immensely. Most importantly, having an original set of beliefs and abiding by your principles matters more than having specific content of your philosophy.
Despite being focused more on their basic beliefs rather than gains, visionary companies succeed nevertheless.
Visionary companies remain faithful to their basic beliefs and manage to encourage development and enhancement incessantly.
While visionary companies are keen on preserving their basic beliefs, the implementation of those beliefs may be altered or advanced at any time, which is the secret of success of these businesses. Take for instance Wal-Marts intense interest in surpassing customer expectations, which is a fixed principle in their set of beliefs. At the same time, they may change the implementation of greeters at the doors of their stores. Furthermore, Boeings basic principles that are concerned with being the first in the aviation industry and jumbo jets manufacturing as the implementation of their ideology that is open to changes may serve as another example.
Such adaptiveness illustrates the ability of visionary companies to ignore the tyranny of the OR, which is the name of the concept that describes a situation when a business has to either adhere to its basic beliefs or encourage progress. Alternatively, visionary companies apply the genius of the AND by remaining faithful to their basic beliefs as well as making advancements and trying new ideas.
Being directed by their basic beliefs, visionary companies are still determined to enhance their manufacturing, management, and business. They cannot be fully satisfied and they would never tire. For example, J. Willard Marriot, the founder of the Marriott Corporation, adopted the following creed: Keep on being constructive, doing constructive things, until its time to die make every day count, to the very end. Though it might seem a bit pessimistic, it reflects the promise to evolve continuously.
Similar to the basic beliefs, such keen interest in development progress is indisputable and ingrained in the case of visionary companies. Ambitiousness concerning objectives as well as specific instruments for prompting individuals to be creative enhance further development.
Visionary companies remain faithful to their basic beliefs and manage to encourage development and enhancement incessantly.
Big Hairy Audacious Goals help visionary companies to enhance development.
Visionary companies use Big Hairy Audacious Goals or BHAGs, which are particularly risky objectives, and pursue them relentlessly in order to enhance development. Appearing quite adventurous, BHAGs are frequently viewed as idealistic, in particular, by those unfamiliar with the concept. At the same time, the company is able to understand them perfectly and to devote its effort to them.
In 1961, John F. Kennedy boldly stated that the USA would send a man to the moon in the next ten years, which was a famous example of a BHAG. While it was a rather ridiculous idea back then, it did prompt the States to work more.
Similarly, Boeing had a number of BHAGs in its time, among which was the creation of Boeing 747. The company remained steadfast in its desire to fulfill this goal and discarded any doubts concerning its achievement. The Chief Executive vowed to finish the project even if it cost them their whole business, which was almost the case: they had to lay off about 86,000 employees, which was more than the half of their labor force, because the sales of the jet were not as high as expected.
In the case of Thomas J. Watson Sr., the founder of the Computer Tabulating Recording Company, a BHAG was established through the change of the companys name in order to show his desire to be recognized worldwide. The business was initially preoccupied with selling coffee grinders and butcher scales, and the new name, International Business Machines (IBM), seemed rather bold at the time.
Frequently, BHAGs continue to exist independently. Similar to the space exploration program that remained even after Kennedy died, the BHAGs of the visionary companies in focus were strived for despite the changes in management. New BHAGs were established when the old ones were attained, and they always complied with the companys basic beliefs.
Big Hairy Audacious Goals help visionary companies to enhance development.
A visionary company is like a cult: newbies either succeed or quit.
Visionary companies are so determined to adhere to their basic beliefs that their inner environment resembles that of a cult. For instance, it takes little time for the newcomers to end up interacting mainly with their co-workers while they are also prompted to keep the peculiarities of their work to themselves.
The basic beliefs frequently become dominant in the lives of employees. For instance, in IBM, the trainees would sing from the IBM collection of songs:
March on with I.B.M., Work hand in hand
The Walt Disney Company also wants its workers to adopt its basic ideology of nice quality family pastime. Thus, having facial hair meant no job for men at theme parks, and Walt Disneys hearing an employee cursing resulted into the instant loss of the job.
Visionary companies mostly need people who satisfy their great expectations and adhere to their principles. Newcomers usually end up either achieving success at their workplace or failing miserably and eventually leaving the company. Concerning this aspect, visionary companies would not change their standards.
In turn, due to the workers being self-sufficient and reliable in terms the companys basic beliefs, there is freedom for creativity and venture. It enhances development and helps the enterprise to escape the curse of most cults: a need for consensus.
However, bear in mind that visionary companies have nothing to do with personality cults devoted to charming executives or leaders, but rather they focus on the companys basic beliefs. Of course, charming individuals tend to stimulate productivity, but, when they leave, their cults always dissipate.
A visionary company is like a cult: newbies either succeed or quit.
Visionary companies are the constant source of superior leaders.
The visionary companies under discussion were frequently headed by great leaders, but their knack for delivering such professionals all the time was even more extraordinary.
The companies priority was to nurture their managerial geniuses in order to have reliable leaders in future in terms of directing the enterprise along the line of its basic principles. Visionary companies were simultaneously developing the strategy to make sure that the management persevered despite possible challenges.
The General Electric Company (GE) may serve as a good example in this case since Jack Welch was its famous CEO. In fact, there were many Jack Welches in the companys administration due to its focus on the preparation of internal management and CEO succession. Moreover, greater numbers of GE graduates have earned the executive positions in American corporations compared to the alumni of other organizations. Seven years prior to his leave, Jack Welch himself developed a system for succession, though it may seem a bit late considering that the former Chief Executive of Motorola, Bob Galvin, started his plan for the future 25 years prior to retiring.
Conversely, the counterparts of visionary companies made a practice of hiring CEOs who often did not know the peculiarities of the company and who occasionally directed the business toward new, poorly planned projects. In addition, the executives of such companies frequently were excessively authoritative and reluctant to devise succession plans, which damaged the companies management in the future. The executives of some of these companies sometimes even ended up deterring succession planning and undermining likely candidates. After the eventual leave of such damaging managers, these businesses struggled.
Visionary companies are the constant source of superior leaders.
Visionary companies enhance evolution through supporting experimenting.
According to Charles Darwin, evolution is a sequence of fruitful experiments when minor differences appear and only the potent ones remain. The visionary companies in focus viewed the necessity to enhance similar evolutionary processes within their structures in the same way. They prompted their workers and administration to try out new ideas, products, and methods, some of which achieved immense success.
For instance, this was the case for J&Js Band-Aids. The idea appeared when one of the employees used surgical tape and gauze to treat his wifes fingers after she injured herself by accident with a knife. When the worker presented his invention to the Marketing Department of J&J, the management accepted the idea and Band-Aids soon brought the company success.
In the case of 3M, which encouraged its employees to spend 15 percent of their time at work on various projects of their choice, two such projects developed by two different workers resulted into the popular Post-It Notes. There was little or no chance of it happening if 3M hadnt stimulated experimentation or supported its workers in their creative endeavors despite early market research showing negative results. In contrast, 3Ms counterpart, Norton, actually dissuaded the search for possibilities outside of its conventional framework.
A number of variations or rather most of them do not last, which is one of the features of evolution; moreover, it is the same with businesses. In fact, J&J had a number of major defeats as well, including its colored casts for children with fractured bones. The products transformed hospital bed sheets into a modern art exhibition, which did not benefit hospital laundries.
Visionary companies realized that unsuccessful experiments were the price of evolution and must not be discouraged with penalties.
Visionary companies enhance evolution through supporting experimenting.
Visionary companies are not all talk and no action they take practical measures to incorporate their values into reality.
A number of enterprises assert that they appreciate visionary values, support experimenting, and feel enthusiastic about changes, but these claims extremely differ from reality. However, the visionary companies under discussion have succeeded in transferring their values into the real life with the help of the devised techniques that impacted the ordinary lives and choices of workers.
For instance, 3M did not simply ask for more innovative workers. In fact, it adopted several techniques to stimulate this idea: it permitted employees to spend 15 percent of their time on side projects and stated that 30 percent of every departments sales per year must come from the products not older than four years.
Similarly, visionary companies did not simply focus on continuous enhancement, but they developed particular techniques to guarantee it. For instance, Wal-Mart prompted constant development with the help of Beat Yesterday ledgers, which showed the differences between the current and previous sales. Besides, Hewlett-Packard established a difficult process of ranking its workers each year in order to prompt those who already achieved something to continue their hard work.
In addition, the visionary companies took some long-term measures. Compared to other companies, they made greater investments in developing new technologies and business practices, preparing and enhancing their workforce, and stimulating research and development.
Thus, when Merck wished to establish itself in the medical research sector, it intentionally made its labs similar to the academic ones and allowed its scientists to publish their results in scholarly journals, which was quite unconventional for the then private companies. In addition, Merck resolved that the procedure of developing a product should be determined by research instead of marketing as it was the case for a number of companies. Such measures brought prominent scientists to Mercks labs.
Visionary companies are not all talk and no action they take practical measures to incorporate their values into reality.
Conclusion
The main idea is as follows:
Visionary companies are capable of achieving unprecedented success and remaining faithful to their basic beliefs while tirelessly continuing to develop. The basic beliefs of an enterprise constitute its main values as well as its goal, in other words, the reason it exists outside the framework of gains or shareholder value. In order to support their basic beliefs, visionary companies encourage continuous development by formulating audacious objectives and implementing fundamental techniques to ensure their policies.
The questions that have been answered:
Why should visionary companies be studied?
- The lasting achievements of visionary companies can provide invaluable experience.
What are the main tenets that visionary companies use to succeed?
- Visionary companies may be compared to the ever working factories that create outstanding goods and leaders.
- Despite being focused more on their basic beliefs rather than gains, visionary companies succeed nevertheless.
- Visionary companies remain faithful to their basic beliefs and manage to encourage development and enhancement incessantly.
What are the specific techniques and methods that visionary companies utilize to maintain their basic beliefs and enhance development at the same time?
- Big Hairy Audacious Goals help visionary companies to enhance development.
- A visionary company is like a cult: newbies either succeed or quit.
- Visionary companies are the constant source of superior leaders.
- Visionary companies enhance evolution through supporting experimenting.
- Visionary companies are not all talk and no action they take practical measures to incorporate their values into reality.