Notes on: Building Your Company's Vision

'Building Your Company's Vision' is an article by James C. Collins and Jerry I. Porras and was originally published in the Harvard Business Review

The Idea in Practise

Although a company's strategy will change continually, its core ideology should never change. A core ideology defines a company's character and holds the organisation together. It has two parts:

1. Core values are the handful of guiding principles by which a company navigates.

2. Core purpose is an organisation's most fundamental reason for being.

An envisioned future itself has two elements:

1. BHAGs (Big, Hairy, Audacious, Goals). These are ambitions plans the organisation can rally behind and they can have anywhere from a 10-30 year horizon to complete.

2. Vivid descriptions paint a picture of what it will be like to achieve the BHAGs. These make the goals tangible.

Questions to help you define your core values:

• What core values do you personally bring to your work?

• What would you tell your children are core values that you would like for them to hold when they become working adults?

• If you awoke tomorrow with enough money to retire, would you still live these core values?

• Can you envision your values being true 100 years from now?

• Would you hold these values even if at some point they became a competitive disadvantage?

• What core values would you build into a brand new organisation, regardless of industry it was in?

Getting to your purpose with the 5 whys.

Start with a descriptive statement of your business, then ask 'Why is that important?' 5 times. Filtering through this lense helps you arrive at the fundamental purpose of the organisation.

Discovering Core Ideology

Core ideology cannot be created, it must be discovered. You arrive at your core ideology by reflecting inwardly. It must be authentic and will guide and inspire, but not differentiate. It is not to be confused with core competence, which defines what your organisation is particularly good at. It also does not need to be appealing to people outside of the organisation, but can be used to attract talent that fits well within the organisation's culture.

Vision-level BHAG

Visionary companies often use bold missions, or BHAGs, as a way to guide and inspire its employees. A true BHAG is clear and compelling and serves as a unify focal point of effort, and as a catalyst for the team spirit. It also has a clear finish line. A BHAG should not be a sure bet, and should have a 50-70% probability of success. Types of BHAGs include:

• Target BHAGs (quantitative or qualitative), such as 'Become a $125 billion company by the year 2000' (Wal-Mart, 1990), or 'Democratize the automobile' (Ford Motor Company, early 1990s)

• Common-enemy BHAGs, such as 'Crush Adidas (Nike, 1960s)

• Role-model BHAGs (good for up and coming organisations), such as 'Become the Nike of the cycling industry (Giro Sport Design, 1986)

• Internal-transformation BHAGs (good for established organisations), such as Transform this company from a defence contractor into the best diversified high-technology company in the world (Rockwell, 1995)

Vivid Description

A vivid description is vibrant and engaging. It uses words to paint a specific picture of what it will be like to achieve the BHAG.

A Few Key Points

• Do not confuse core ideology and envisioned future, or core purpose and BHAGs. Core purpose is the reason the company exists and can never be completed, whereas a BHAG is a clearly articulated goal that could be reachable in 10-30 years. Identifying core ideology is a discovery process, but setting an envisioned future is a creative one.

• The envisioned future should be so exciting in its own right that even if the leaders who set the goal disappeared, the organisation would still be motivated by it.

• The difference in successful organisations does not lie in setting easier goals; or charismatic, visionary leadership; or better strategy, rather their success lies in building the inner strength of the organisation and letting that define their future.\

• Start-ups can often loose momentum by rallying behind a goal that is too easy to hit and not clearly defining the next one.

• Building a vision company requires 1% vision and 99% alignment. Creating alignment may be the most important work, but it it comes after recasting your vision or mission to build a visionary company.