There seems to be a predictable arc to business success today: Launch a company; make a splash; do an IPO; write a book. It’s the last part that almost always disappoints. How many books by or about big-name company founders can you name that really capture the drama, the heartache — and the lessons — behind their success? All too often, smart business leaders write dumb books.
But not always. The best books about companies tell great stories. They are packed with experience, rather than absolutes. They offer an honest look at awkward beginnings, botched decisions, magic meetings, bursts of genius, improvised solutions, and moments of truth. And in most cases, they’re not stories of invention; they’re stories of reinvention. They tell of leaders and companies that transform what it means to be in business.
Fast Company thumbed through a stack of recently published company stories that have been spun in this spirit. Here are the secrets of success that these books yield.
The High-Concept Company
As narrated by Swedish journalist Bertil Torekull, “Leading by Design: The IKEA Story” (Harper Business, $26) reads at first like a standard tale of the mythic boyhood and intellectual development of the “legendary founder.” The front end of Torekull’s book is packed with details from the early life of Ingvar Kamprad (the “I” and the “K” in IKEA): his German grandparents’ immigration to the dark woods of Slammed; the dyslexic farm boy who, at the age of five, became an enterprising peddler — setting up shop at a roadside “churn stand” (a country store) that evolved into a $7 billion business, with 150 stores in 30 countries.
Once Torekull gives up this ponderous layer of psychological commentary and lets Kamprad speak, the book tells a very different story — the story of IKEA’s “business idea.” The core of the idea is “democratic design”: the trinity of attractive form, inexpensive production, and high function. That idea, combined with what Kamprad calls “the underdog’s obsession with always doing the opposite of what others were doing,” propelled him and his young, unconventional, risk-taking comrades along a path of constant innovation and experimentation.
The real secret of IKEA’s success? “We are a concept company,” answers Kamprad. IKEA’s concept is articulated in a document drafted by Kamprad in 1976: “a furniture dealer’s testament.” It outlines a set of nine commandments — including perpetuation of the “IKEA spirit” of enthusiasm, thrift, responsibility, humbleness, and simplicity; and “always asking why we are doing this or that . . . refusing to accept a pattern simply because it is well established.”
Tom Chappell doesn’t make furniture, but he agrees with the IKEA philosophy. In his new book, “Managing Upside Down: The Seven Intentions of Values-Centered Leadership” (William Morrow, $25), Chappell says that the winning concept behind his company is as basic — and as profound — as encouraging people to know who they are. The founder and CEO of the natural-products company Tom’s of Maine (and the author of “The Soul of a Business” [Bantam, 1993]), Chappell has been a leading proponent of the philosophy that doing good is good for business.
That sounds nice. But it also sounds just a little trite. How do you create a successful business on the basis of values? What it comes down to, says Chappell, is asking the right questions — not, “Where do we want to go?” or “How do we get there?” but “Who are we?” and “What do we believe in?”
According to Chappell, a company finds its destiny by answering three questions: “Who are we?,” “What do we stand for?,” and “How do we serve?” At Tom’s of Maine, those questions triggered the creation of a core document, “Reason for Being,” that everyone in the company has to digest. They also set off a product-development streak. Chappell and his wife (and partner), Kate, created “acorns” — teams of product “champions,” which have organized various product lines. The results have been stunning: The teams not only came up with a now much-copied baking-soda toothpaste but also took the company out of a three-year dry spell by creating 26 products in less than 18 months.
While Tom Chappell’s manifesto for upside-down management gives off a pious air, Andy Law’s new book – “Creative Company: How St. Luke’s Became ‘the Ad Agency to End All Ad Agencies'” (Wiley, $29.95) — crackles with rebellious and creative energy.
Back in 1995, at the pinnacle of a brilliant career as an ad executive at the best of London’s creative shops, Andy Law had a moment of truth: Then the managing director of the London office of Chiat/ Day, Law learned that Chairman Jay Chiat was planning to sell the agency to the ad giant Omnicom. Law was asked to join the new organization as a senior executive, but the merger went against his every instinct. So Law and 35 of his colleagues from Chiat/Day London set out not only to build their own agency but also to rethink the nature of the ad agency — from the ground up.
Thus begins the story of St. Luke’s, an “ad agency to end all ad agencies” (a phrase that Law borrowed from a December 1996 Fast Company article about the then-fledgling agency). Exhilarated and terrified, Law and his friends gathered a few clients (including Midland Bank, Nickelodeon, and Boots Co. PLC) and leapt into the abyss. Their charter: Dream up the ultimate organization to help rectify what Law considered to be a crime against humanity — the all-to0-wide disparity between what people need and what work demands of them.
“Humans are creative, fun and inquiring; yet work for so many is monotonous, complex and dreary. Humans are individual and versatile; yet at work we discover we are all expendable and carefully placed in a well-manicured organogram,” Law writes. Not only would the new agency produce highly innovative work, but it would also reinvent the role of the ad agency in society.
The shape of Law’s organization grew out of the wild ideas and creative energy of people who had been unshackled from all restraint. Every aspect of the organization was reinvented. Among the key features of St. Luke’s are its symbolically unconventional name; an office environment that is devoid of personal space, in which employees share workstations, and in which private spaces are custom-built for each client; and, most important, an innovative ownership scheme that puts the organization in the hands of its employees. St. Luke’s is owned by a trust, its business affairs are governed by a six-member, owner-elected council, and shares are awarded equally to all employees every year. The unusual result? A recently hired creative superstar might have fewer shares than a receptionist who has been with the agency since its inception. “We have . . . constitutionally removed greed from the business,” writes Law. “That, I can tell you, is our most liberating force.”
St. Luke’s is held together by values — by freedom of expression, a lack of coercion and fear, and a determination to make work fun. The organization also has certain rhythms (which are marked by an annual series of playful gatherings). After running full-out for three years, St. Luke’s declared a “Summer of Love,” during which pitching for new business was suspended, and during which the company declined the chance to take on a £50 million Cable & Wireless account. Innovation is continuous. The company is an “experiment at work,” writes Law. “It is a creative idea that we constantly test as much as we test the creative ideas we produce.”
Sidebar: Big Blue, Big Change
Unlike the other leaders whose books are reviewed here, Lou Gerstner did not create the company that he is most famous for running — IBM. Nor did he write the book that tells his tale. But “IBM Redux: Lou Gerstner and the Business Turnaround of the Decade” (HarperBusiness, $27.50), by Doug Garr, nonetheless offers intriguing lessons. The author, a former IBM speechwriter, insightfully addresses how “big” and “change” go together.
What makes Gerstner the most accomplished big-company change agent today? First, he demonstrates an unwavering customer focus and brand sensitivity. “Gerstner is just a brand guy in the information age, a conventional, conservative, button-down CEO who wants people to know that he does not understand how computers work. Just that they do work,” writes Garr.
Second, Gerstner — who has held top jobs at McKinsey & Co., American Express, and RJR Nabisco — has a keen strategic mind, phenomenal powers of simplification, and immense self-confidence. Just as important, he’s a scavenger, always on the lookout for great ideas and great people.
Third, Gerstner has moved forward on a “vertical vision of reality,” treating the McKinsey “up or out” mantra as a strategic practice. One colleague described Gerstner as an “omnivore moving forward.”
“IBM Redux” does not provide a very likable portrait of Gerstner, but it does offer a fascinating, detail-rich story of change. Garr conveys the “bigness” of IBM — and a sense of how things actually click at the individual level.
Are you too busy creating your own company to read a bunch of books by company founders? Then allow us to provide a small dose of business philosophy, all of it distilled from decades of hands-on experience.
Work Is Personal: “The power business has over our lives is awesome. It can promote us or dump us. It can offer self-esteem or lack of dignity. It can frighten and coerce us. It can stretch our imaginations. It can destroy families and it can sponsor and build marriages” (Andy Law).
Time Is Money: “Time is your most important resource. You can do so much in ten minutes. Ten minutes, once gone, are gone for good. . . . Ten minutes are not just one-sixth of your hourly pay. Ten minutes are a piece of yourself. Divide your life into ten-minute units and sacrifice as few of them as possible in meaningless activity” (Ingvar Kamprad).
Leadership Is Hell: “Sure, I am a religious man who is also passionate about conserving the environment. But I am also a CEO, with all the bad habits and attitudes that are natural to the species. . . . I am still as naturally self-interested, overconfident, full of pride, and eager to control a meeting as any CEO in America. Every day, I struggle with my ego” (Tom Chappell).
Change Is Hard: “Unless you are prepared to give up something valuable you will never be able to truly change at all, because you’ll be forever in the control of the things you can’t give up” (Andy Law).
CEOs Are Complicated: “However close you think you are to a person, there is always a distance. I used to be, and still am, in the double hell of having both power and money?. With my authority, I have been able to say a whole lot of stupid things without anyone reacting” (Ingvar Kamprad).