Building a business that lasts is one of the hardest accomplishments. The average lifespan of a U.S. S&P 500 company has reduced from 67 to 15 years in the last 80 years.
It’s more than 80%. Disruptions are the norm today. Digital leadership requires handling business differently to make it sustainable.
According to US Bureau of Labor Statistics, only 36 percent businesses survive to their 10th birthday, and 21 percent make it to their 20th anniversary.
These businesses possess a deeper understanding and purpose, they build ties that are hard to break and handle transitions smoothly. Here we look at attributes of businesses that lasted more than 100 years and find out what makes them tick.
- Genuine Purpose
Every great company is built with a purpose. It is this driving force that binds everyone together and helps direct the company.
Max De Pree of Herman Miller Inc. (1905) says, “Profit is the result of doing well what they do as a company, not their goal.”
In order to achieve sustainable success, companies need to identify their core purpose, what they stand for and what the want to accomplish. In a study by Harvard, companies that lasted more than 100 years were all driven by a strong purpose.
A purpose gives the company its meaning, it helps to connect with people, customers and society.
2. Handle Transitions & Disruptions
Businesses don’t excel in isolation. They need to move on with changing demands of their time. Great companies that last long are able to handle the transitions well. They know how to adapt and change according to the demands of the future. The weather the storms and disruptions to stay relevant.
Studies have shown that companies that survive are able to master the art of evolution. They constantly strive to reinvent and improve themselves. They stay relevant for their customers.
3. Attract Right People
Without the right people, a business can grow and touch great heights. Great companies often attract people who are dedicated and committed to building businesses. Very often it is not just the talented people, but the sheer dedication of the workforce that makes a difference.
An organization needs to be able to have the right talent pool to build great products and services to serve their customers. Companies that last over 100 years are often able to build businesses that have a core group of people for handling key responsibilities.
4. Core Business
The businesses that last long are those that have a deeper understanding of what it takes to serve their customers. They know their core focus areas, their strengths and how they can serve great value.
These businesses are stable because they are consistent, understand their core business and generate value for everyone. They establish themselves as experts & exert great influence in their core areas. These companies build great cultures and know how to preserve them.
5. Support, Share and Collaborate
When business is driven like a mission, it connects people and they are more likely to spread your stories. A five year Harvard study on seven Centennials that have managed to outperform their peers for 100 years revealed interesting insights. The study shows how companies support, help and collaborate with others.
For example, Berkshire Hathaway, Nike and Starbucks have published books to help people learn about their success, failures and setbacks. These companies believe in sharing their experiences through blogs, books and take every opportunity to connect with people.
6. Staying Open
Companies that stay open survive by embracing the right ideas and systems that work. Staying open to new opportunities, constant exploration of the new frontiers and reimagining things in changing times are important.
Organisations need to find ways to stay innovative and open for reinvention. The successful companies strike the right balance between tradition and transition that keeps them going.
7. Inspire & Impact
Companies that last long have their personality, they are resilient, relevant and bring about a successful transformation in the community. These companies inspire people to achieve their best, push them to achieve the extraordinary and create a long lasting positive impact.
These successful companies understand that it is not just their customers, but employees and community that complete their circle. They figure out ways in which their core competencies benefit society on a larger scale. They identify what truly matters and build a company which is valuable to the community. As a result people root for their success and it can make a big difference, especially when the chips are down.
