Today, a speculation…
As you probably know by now, I grew up in a General Motors factory town. The year I turned 11 (1962), GM reached its peak share of the US car market. It was obvious to most every observer that GM was the world’s greatest, best-run company, as well as its largest industrial company. It was unimaginable that it would ever go into decline, let alone perish.
If you wanted a lifetime job in my town, you could go to GM, or you could choose from the local bank, Sears, or the telephone company. It was as if these companies had been around forever and would be here forever.
It has long since become clear to me that none of those great institutions were permanent. But I would have never guessed that I might outlive some of them, or that General Motors would be limping along when it reached 100 in 2008 (GM was already past 50 years of age in 1962).
At the same time, many entrepreneurs – me included – think in terms of “building something for the ages,” something that is, to use the title of an excellent book by Jim Collins, built to last. Not built to flip, or just built to enrich, but built to last.
When I first struggled to get my hands (and head) around the idea of the impermanence of great institutions, I thought it was some sort of tragedy. But then I stepped back and reminded myself that humans, even the greatest among us, have short lives compared with institutions like General Motors.
The fact Michelangelo only lived to be 88 makes his accomplishments no less significant. The death of Thomas Edison at 84 takes nothing away from the import of his inventions. The loss of George Gershwin at 38 or Wolfgang Amadeus Mozart at 35 does not dull the power of Rhapsody in Blue or Mozart’s concertos and symphonies.
In fact, nothing lasts forever, except perhaps energy and mass. Nations, languages, inventions, and peoples all rise and fall over time. Some evolve and carry on in new forms (like the English language) while others virtually disappear (for example Aramaic, the language of Jesus, spoken today by very few people). Germany and Italy, as nations, are less than 150 years old. China as a modern nation is less than 100 years old, although China as a concept is thousands of years old.
In this context, I am fascinated by two questions:
· What can we do or create that does in fact last, or have a lasting impact, or act as a significant stepping stone to the future?
· What determines how long various institutions last?
Last week I gave a talk about the history of the movie industry, and pointed out that, as “assets,” the great movies appear to have a very long life. The “libraries” of old movies held by the big movie companies will have value long after the buildings, distribution networks, hardware and software, and brands of these companies have died away. It would be very hard for Snow White and the Seven Dwarfs or Casablanca to disappear. At least as long as there are people around, these historic and beautiful films will hold value.
It later occurred to me that their continuing value might require the continued use of the English language, but then it made me think that the presence, permanence, and importance of English-language movies would tend to preserve the use of English. In other words, maybe it’s not so much “these movies will be valuable as long as people speak 20th century American English” as “20th century American English will be preserved because people want to continue to watch 20th century American-made movies and television programs.”
While I make no claims for the permanence of Who Wants to Be a Millionaire, I would propose that there is no better way to understand the foibles of current American society than watching a few episodes of the Simpsons. The documentaries of Ken Burns, the BBC, and National Geographic are often important historical records.
The great books, works of art, movies, and architectural works of the ages are about as close to “timeless” as one can get. Perhaps alongside them we should include the great scientific discoveries, technological breakthroughs, and even theories of the social sciences. I think the invention of the corporation, as a way of sharing risks and therefore enabling bold ventures and innovation, is one of the most important of all human inventions.
If you or your enterprise engages in the creation of such things, you could be making a lasting difference, no matter how long you or your enterprise lives on.
When I turn to my second question, the lifespans of our great institutions, I seek in vain serious study of why some last a long time and others are so short-lived.
This year both John Deere and Procter & Gamble turned 172 years old. It appears likely both will make it to 200 as independent entities. Colgate and some of the banks and insurance companies are even older. Canada’s Hudson’s Bay Company will turn 340 next year, and Harvard University will be 374.
Why do some companies and not-for-profits live so long while others barely make it 50 years? What are the determinants? Does it vary by industry, by era, by region? By underlying technology? It is a matter of external economic and social factors or does it come back to management, strategies, marketing, and all that?
One of my own goals is to take a “deep dive” into the study of enterprise longevity, to look around at large numbers of real world examples, and try to come up with some answers to this second question. I invite your comments and input to my thinking and studies. Stay tuned for more in my quest for find answers to questions such as these, a part of my lifelong quest to understand history, to understand how things change through time …