Tom Peters's True Confessions

Almost 20 years ago, In Search of Excellence, by Tom Peters and Bob Waterman, was published. No one much cared. At the time, the United States had more serious business problems to attend to: inflation: 10%. Prime interest rate: 20%. Unemployment: 10%. Japan was eating America's lunch.

Search slipped unnoticed into this realm of business darkness and competitive gloom. But it began to catch on. And catch on. And catch on. Until it became a fad. Then a cause. Then an industry. Search became a publishing event without precedent in the business world.

Twenty years later, Search can legitimately claim to have fired the starting gun in the race to the new economy. It marked an important inflection point in business history.

The 20th anniversary of the publication of Search comes at another inflection point in history. The September 11 terrorist attacks on the United States, arriving on the heels of a dramatic economic downturn, have combined to raise new questions about American business and leadership. Those factors make the 20th anniversary of Search a perfect time for a fresh look at a powerful set of ideas, their creation, and their implications.

For the first time in Search's 20-year history, Tom Peters comes clean about why and how he wrote the book in the first place. What he got right, what he got wrong -- and what he outright lied about. And what comes next. Because the story behind Search holds important lessons about the new big ideas that will set the agenda for what comes next in the world of business.

It's all part of "Tom Peters's True Confessions." -- The Editors

In Search of Excellence was an afterthought, the runt of the McKinsey consulting litter, a hip-pocket project that was never supposed to amount to much. That's my first confession, and it's the truth.

Of course, there's an official way that I tell the story now -- and it's total bullshit. The way I tell it now is, "Americans were under attack by the Japanese, who were making good automobiles. So Bob Waterman and I set out to discover the real secrets of management." Usually when I tell that version of the story, I try to use my imitation voice-of-God way of speaking to convey the impression that what we set out to do was Very Important.

Which is completely wrong. The truth is that back in 1977, Ron Daniel, who was then the managing director of McKinsey, decided to launch two projects. In McKinsey's world, all of life is one of two things: strategy or organization. Since the strategy guys rule, the big project was the capital B Business, capital S Strategy project. (Please note the capital letters.) It was headed by Fred Gluck, who later succeeded Daniel as managing director. The BS project was located at corporate headquarters, and it had a lot of top-notch consultants attached to it. And since all of those things were true about the project, nothing ever came of it, and it has never been heard of since. So here's lesson number one: Don't always bet on the little guy, but do always bet against headquarters. Because headquarters politics will invariably and inevitably "bland up" and then kill any worthwhile project.

Meanwhile, Daniel had this other little dip-shit project that he wanted to mount. He was looking for someone to look at the organization side -- the structure-and-people side. And there I was, just through blind-ass luck. I had done seven years at Stanford Business School, which at the time was considered to be much cooler than Harvard, to get my PhD in organizational behavior. Interestingly, there had been only four people in my organizational-behavior doctoral class at Stanford. And even more interestingly, all four of us were ex-engineers who on some vague level had the notion that numbers and statistics weren't enough. We suspected that they didn't tell the whole story about how companies really worked -- or maybe even worse, that they obscured the real story behind what it took to compete and win in the then-evolving world of business.

So the assignment went to this silly little guy called Tom Peters and his silly little buddy called Bob Waterman, both of whom were considered kind of marginalia in the world of McKinsey. We were out in the San Francisco office, far, far away from McKinsey headquarters, tucked inside an office that never made any money but that was well-known for its weirdness. In fact, there were always people in other parts of McKinsey who would reach a point in their analyses where they would try to get us involved, because they wanted us to do our "San Francisco thing." We were the closest thing McKinsey had to hippies -- hippies in black suits.

We were the weak-sister project; the Business Strategy project back in New York was the star-studded project. So let's hear it for weak-sister projects! They involve lower expectations, far less political baggage, and much less management scrutiny! (And they are more likely to produce results.)