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STRATEGY

Reconnaissance: Beyond and Back
 

Yvon Chouinard and the startling power of authenticity.
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Among CEOs back in the fruity, revolutionist, hallucinogenically entrepreneurial '80s, Patagonia's Yvon Chouinard became famous for one thing above all else: He was the guy who "managed" his company by leaving it behind.

And we mean seriously behind. For half a year at a stretch. To Nepal or Baja or, hey, Patagonia. Remember "management by walking around"? This was management by walking away. Chouinard even had a name for it: MBA--management by absence. And as he wandered the earth from Alp to surf break, all while his little equipment and clothing business grew hipper by the season, he became less a model to be copied than a dream to be envied. Payables mounting? Hand me my fly rod.

But, okay, there wasn't only that. Chouinard also gave away money (1% of Patagonia's sales or 10% of profits, whichever was more--adding up to $22 million since 1985). He declared that "growth and expansion are not basic to this corporation" (emphasis his). And he would tell anyone who asked (and plenty who didn't) that though he'd been a businessman for decades, "it's as difficult for me to say those words today as it is for someone to admit being an alcoholic or a lawyer. I've never respected the profession."

Now he not only speaks those words--he's written them down. In Let My People Go Surfing: The Education of a Reluctant Businessman (Penguin Press), Chouinard holds forth. He first recounts his own and Patagonia's history and then, in the last two-thirds of the book, describes Patagonia's eight "philosophies," the principles that guide the company's employees in every part of the business--from design (for which Patagonia is justly revered) to image to distribution to finance.

It's a good book, with useful things to teach. But its most startling lesson may be unintentional. What separates Surfing from every other business memoir I've read is its otherworldly lack of calculation. Chouinard has zero sense of irony, zero strategy for self-presentation, and almost zero notion of the effect his words will have on readers. He's naive, original, infuriating, provocative, wrong, right, passionate, obsessive, and, most of all, true. And if you think lots of people are true--or lots of books are--then give Surfing a try, and afterward tell me if you think so still.

At its beginning, Chouinard's story reads like a volume from some Boy's Own Adventure series (entrepreneur's edition). He was an adolescent misfit, an undersized high school outsider who found his psychic home outdoors, where he could fish, climb, and explore. He helped launch the Southern California Falconry Club. (What, your high school didn't have one?) And in 1957, when he was 18, he borrowed $825.35 from his parents to buy a dropforging die, which he used to make angle pitons and other hardware for the rock climbing he'd already come to love. Soon he was selling the custom-made wares out of his car.

Hence the first significant misunderstanding about Chouinard: that he was an "accidental" entrepreneur--a bloke who fell into commerce unwittingly and thus whose ultimate success can seem mostly a blessing of fate. Chouinard's entrepreneurship, like that of so many accidental entrepreneurs, wasn't accidental so much as it was organic. It began logically, on a tiny scale, and by increments it evolved. On the strength of that dropforging die Chouinard started Chouinard Equipment, "a small company designing and making the world's best climbing equipment for its employees and their friends. Chouinard himself was then becoming a world-class climber. As he and his employees and friends needed different or better gear, he made it, and Chouinard Equipment grew. Only as much as necessary, however. This was the '60s, and Chouinard and his crew were like most climbers then (now, too?). "Alienated from the mainstream suburban culture," Chouinard writes, "...many earned subsistence incomes on purpose, and they worked as little as they could. Corporate life did not appeal; it was regarded as inauthentic, illegitimate, and toxic." (Think "toxic" is a little harsh? Then be prepared for more. Chouinard is aggressively critical of modern life and deeply committed to environmental activism.)

For all the work-to-live-don't-live-to-work ethos, though, the enterprise gradually thrived. Chouinard added clothing to the line because the gear he needed didn't exist: reinforced pants and shorts that would hold up under duress, shirts with the right pockets, outerwear made of new high-performance fabrics the company helped invent. (Hard to believe now that people ever went hiking in cotton, wool, and rubberized coats.) He sold via catalog, retail stores, and ultimately the Internet, adopting the name Patagonia when Equipment no longer fit. The operation became famous for its flexible work style (employees really did, and do, check out during the day to go surfing) and its shoeless, casually creative vibe. By 1990 the business was doing $100 million a year.

Then came a crisis, though not the first. In the '70s there had been a painful breakup between Chouinard and some early partners, and now, in the 1991 recession, Patagonia hit a wall. Unfortunately, Chouinard does a pale job describing the trouble, but the upshot was straightforward enough. On July 31, 1991, the company laid off 120 employees--20% of the work force. The move was made trebly painful by the fact that Patagonia really was like a family, thanks to its long practice of hiring "friends, friends of friends, and their relatives." Soon there were press reports suggesting, to quote a 1992 feature in Inc., that though "Yvon Chouinard touts his company as a model for the future...in fact, its time may already have passed."

Well, wrong. Chouinard claims the newly shrunken and refocused Patagonia has achieved "controlled growth" of 5% a year ever since, and it could have kept a small clippings service busy just harvesting accolades. It has continued to give away money, and to chase a clarified version of the goal it has chased for decades: "Make the best product, cause no unnecessary harm, and use business to inspire and implement solutions to the environmental crisis."

No company builder could read Chouinard's articulation of Patagonia's work without thinking, "I should do that, too."

As fetching as the Patagonia drama is, though, only when you view it alongside the "philosophies" in Surfing does the real moral to Chouinard's story come clear--a moral I doubt Chouinard had in mind. Patagonia's philosophies show a CEO exactingly pinning down every aspect of how his business works and why. Unfortunately, the philosophies are impossible to helpfully summarize in a short space; they're too finely parsed and specific to Patagonia's tasks. (One example: The product-design philosophy examines a dozen or so questions to be asked about each of the company's items: Is it multifunctional? Is it as simple as possible? Are we designing for our core customer? Does it have any added value? Is it art? And so on.) Yet it's that very industry-specificity and task-concreteness that in sum is so inspiring. What astonishes is the way all the pieces and habits and values fit together--amounting to a kind of biomechanical system in which the reuse of old buildings, the refusal to write catalog copy that appeals to vanity or greed, and the decision to open in Japan just to learn how to please the Japanese all seem not merely of a piece but like the obvious and only course. No company builder could read Chouinard's articulation of Patagonia's work without thinking, "I should do that for my company, too."

Of course, Chouinard has had the benefit of time--40-plus years of it spent tending his company's soil. And he's had another benefit, too: Despite what he says, he's never really wanted to do anything else. That's what's unmistakable in the plain ferocity of his voice, in his offending and inspiring trueness. That's what's obscured by the second big misunderstanding about him, which is the way people have misconstrued unconventional behavior as "gonzo," and casual style as casual ambition. Traipse the world's backlands though Chouinard does, his devotion to his company is marrow-deep. What's more, that devotion is the only path he could have taken--that's what comes across in his ability to articulate how and why Patagonia does what it does. You can think of Chouinard as a life study in extreme authenticity.

The moral? Despite all the demurrals, Chouinard the anti-business man is businessman to the bone. Maybe more so. Because it's not a set of clothes he puts on, or an office he shows up at. It's not a role he can pick up or put down. It's who he is. How he thinks. The fly rod was always beside the point. The point, as Surfing shows us, is how powerful an organizing force authenticity can be.

And the question prompted by that point, as Surfing won't let us forget, is: How authentic am I?

Michael S. Hopkins (michaelshopkins@comcast.net), an Inc. editor-at-large, has written for the magazine since 1987.

Last updated: Nov 1, 2005




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