What Comes Next?

Cover Story

Best-selling author Jim Collins on why products, strategy, and charismatic leadership will become things of the past

No one was more surprised than Jim Collins was when Built to Last, the management tome he coauthored with fellow Stanford professor Jerry Porras, became an out-of-orbit success. Published in 1994, the aggressively fad-free book (no just-add-water turnaround tips here) quickly found its way onto best-seller lists, then proceeded to stay there for two years (and counting). No management book could compete with it.

Collins's astonishment was total. The book, a study of great companies founded in the first half of the 20th century, "wasn't exactly sexy," he notes. It offered no quick fixes, issued none of the usual change-or-die threats, and most damning of all, was about the past--suspect subject matter in an age when what's hip is to say business is different and the old rules don't apply.

So why all the clamor? Because, Collins finally concluded, something new was going on, and he and Porras had been lucky enough to get in its way. Without trying to, they had connected with a legion of businesspeople who, in Collins's words, "are hungry to build something of enduring character on a fundamental set of values they can be proud of." The new crowd, far from being the shortsighted, unreflective bunch they're usually taken for, are "hungry to think," Collins continues. "They're hungry for resonance. Maybe because of the change all around them, they want to build on bedrock that won't move. They want to leave a legacy." And when they heard Collins's work had something that could help them do it, they overran every airport bookshop in the nation.

More significant than that stampede, though, are the questions raised by the hunger that prompted it: What will these new desires wreak? How will they shape the companies about to be built--the companies being conceived of now? How will businesses look different in the years ahead? In short, what comes next?

Collins, of course, has a theory.

Like all his theories, it's born of an analytical method that can be summarized like this: He observes contemporary business behavior. He observes historical business behavior. And then he explores how they illuminate each other. In this instance, his observation of today's business landscape reveals a swelling group of company builders seeking a different kind of business life--one richer in meaning, more grounded, more sustainable. Does the past offer examples, even if rare, that show what kind of organization such impulses breed, and what kind of CEO? What's more, if those impulses are growing more common, won't companies of that kind become more common, too?

Yes, says Collins, who then ventures a prediction. "I think we're going to see three significant changes in business because of what these people will create. Number one, we're going to see companies increasingly assume that what they stand for in an enduring sense is more important than what they sell. Second, I think we'll see a shift away from focusing on strategy to building mechanisms. And third, we're going to see people building companies that do not depend on a charismatic leader."

None of those characteristics, Collins points out, is new. Some of the "enduring great companies" (a pet phrase of Collins's) of the 20th century exhibit them all. But in the past those companies were atypical--and those characteristics, even though not novel, are strikingly at odds with the dominant management mantras of our times. Aren't the best companies supposed to be built on product excellence, inspirational leadership, and killer strategies? Not in the 21st century they won't be, says Collins.

When we visited Collins for the conversations that yielded this story, we discovered something else about the characteristics he's identified. They're not just organizational. They're personal. Collins practices them himself.

Collins lives in Boulder, Colo., and works out of a small office suite in a restored brick schoolhouse. He found his way there two years ago when, confronted with unexpected good fortune of bestsellerdom, he did what most of us would do in the circumstances: he refashioned his life. He left his Stanford teaching job, moved to the mountains, and invented the next phase of his career. He also did what most of us wouldn't do: he walked away from the product that had made his name. There were no Built to Last sequels rushed to market. No newsletters. No attempts to turn his book into a brand.

Instead, he established his "management laboratory" and started researching new questions, looking for fresh ways "to contribute through learning and teaching"--the core purpose he has set for himself. (What you stand for is more important than what you sell.) He rejected gurudom and its role as the fountain of answers. (Do not depend on a charismatic leader.) And instead of hunting for the next Built to Last, he constructed habits and systems that are likely to ensure that he trips over it. (Shift from focusing on strategy to building mechanisms.)

Describing all this in person, Collins radiates a peculiar blend of intensity and joy. He is an athletic, springy man, a rock climber, 39 years old. The impression of intensity is exaggerated by the way his eyes always seem more wide-open than most, as if he were living in a world with less light than he'd hoped for.

Despite all the occasionally manic energy, though, Collins seems remarkably at ease in his skin. You get the sense that he feels lucky. And in exploring his ideas about what companies will look like, you begin to see why. It's because he's figured something out: the tools that can change your business may be even more potent for changing your life. Better still, they can bring your business and your life into line--which is how things seem to be shaping up for Collins these days. It looks pretty appealing.