The Michigan 100

I am nearing the end of my Twitter entries of #100over100: Michigan companies over 100 years old.  Several furniture manufacturers, five funeral homes, five hardware stores, six jewelry stores and seven shoe stores!  I didn't realize it when I started, but there are exactly 100 Michigan companies on my list of  businesses over 100 years old that I can verify.  I do have several more names, but cannot find websites, newspaper articles or other confirmation that they are still in business.  So next week (after we hit the 100 mark) I will post the full list on my blog and if anyone knows of Michigan companies that have been in continuous operation for over 100 years and are not on the list, PLEASE LET ME KNOW!

First Stage Research Paper to be Published!

Today I received notice that the first paper we wrote analyzing the comparative research on 100 year old Japanese and U.S. companies will be published in the Journal of Social Sciences in October.  Once I have the specifics I will post the link to the online version of the journal for those who are interested.

Next week my research partner, Makoto Kanda, will be coming to Holland, MI from Japan and we will work on our next paper, which will go into more detail regarding the statistically significant comparative results.  Excited to be at this stage of the research and look forward to sharing the results.  I believe they are very interesting:  it is clear that the leaders of these 'old' companies see their job as one of stewardship, making sure the company succeeds in order to pass it on to the next generation.  With this as the primary objective, their business decisions are somewhat different from generally accepted management theory.

Stay tuned!

100 over 100 on Twitter

In June I stated a new line on Twitter, #100over100, to highlight Michigan companies that are over 100 years old.  I started with companies in West Michigan and should make it up to 40 with these.  Then I will branch out to other Michigan companies until I reach 100.  Right now, however, I only have around 75 Michigan companies in my national data base of companies over 100, so if you know of any please let me know.  It is particularly difficult to identify small, privately-owned companies unless you live in the area and are familiar with them.  When I'm finished, I plan to contact our governor to see if I can convince him to start the kind of "Century Club" that is in place in some other states. (Each year the governor in these states holds a ceremony for all companies over 100, with a special welcome to those just hitting the centennial mark.)

I love seeing new companies start and entrepreneurship is certainly an important part of our state's economic recovery.  But I also want us to recognize the amazing achievement of those firms that have survived world wars, economic depression, globalization, huge changes in technology, and major socio-cultural changes to serve their customers, provide jobs, and add vibrancy to their local communities for over 100 years.  So check out my twitter (@vtenhaken) and see how many companies you recognize - some are well-known public companies, though most are small, family-owned firms.

100 Year Old Companies Are Built on Relationships

One of the results of our research on old companies in Japan is the emphasis they place on relationships.  They value and work at maintaining long-term relationships with employees, customers, suppliers, other business partners and their local communities. Whenever presenting this information at conferences, the response we often received was "Well, that's Japan...it's a cultural thing." There was much skepticism about whether we would find similar results in other cultures.  However, when talking to CEOs of U.S. companies that have survived for over 100 years they echoed the importance of relationships, so we decided to use the same survey administered in Japan to find out how old U.S. companies responded.  We have now collected enough surveys, completed our initial analysis, and are in the process of writing up the results.  My research partner, Makoto Kanda, will be coming to the U.S. in August so we can discuss the statistical data and draw conclusions.  Stay tuned.

In the meantime, I have started to tweet a list of local companies that have thrived for over 100 years (#100over100 @vtenhaken if you're interested).

65 Surveys Completed

Thank you to all those 100-year-old U.S. companies that have filled out surveys for my research!  We are now in the process of tabulating the responses and will compare them to responses from old Japanese companies.  So far it looks like there are many similarities, but we will need to conduct statistical analysis to test for significance.

What Is Unique About Old Companies?

My research partner in Japan, Makoto Kanda, recently completed a study of over 1,000 companies to test our theoretical framework regarding the behaviors of old companies that have enabled them to survive for over 100 years.  By comparing the survey results from 'young' companies with those from companies founded before 1911, he came up with several statistically significant items which indicate we are on the right track with our hypothesis regarding longevity factors.  Here are a few of the results:
* Old companies scored significantly higher in every aspect of developing future leaders and succession planning
* Old companies put much more emphasis on their relationships with suppliers, customers, and local communities
* As might be expected, the old companies focused much more on tradition and improving what they see as their core strengths; when large-scale change is necessary, they admit to taking a long time to plan and implement such change
* The old companies have conservative financial practices (emphasize profitability over sales volume; are reluctant to borrow money)

The complete results have been published in the IMDA book "Global Competitiveness in a Time of Economic Uncertainty and Social Change: Current Issues and Future Expectations" (ISBN: 1-888624-11-6).

A Theoretical Framework for Corporate Longevity

Makoto Kanda, my research colleague in Japan, has completed his research of shinise (revered Japanese companies that have remained in business for a very long time).  The first phase of his research was to conduct in-depth interviews in 17 companies out of which he built a theoretical framework describing common factors observed in these companies that have survived well over 100 years.  He then developed a survey to test the five factors identified in this theoretical framework.  It is this survey that we are using both in Japan and in the United States to test our hypothesis: In Japan he is comparing survey results of shinise and non-shinise to see where there is a significant difference on these factors; then we will compare results of 100-year-old U.S. companies to those of Japanese shinise.  Since we are now ready to begin reporting some of our results, I thought we should start with an explanation of the five factors that form the theoretical framework we are testing.

Our hypothesis is that there are five factors which together result in unique corporate behaviors leading to longevity.  These factors are:
1.  Building corporate identity through careful management of organizational culture
2.  Protecting core/unique strengths through a balance of maintaining tradition and continuous improvement and innovation
3.  Strong relationships with business partners (customers and suppliers)
4.  Investments in developing employees, with a particular emphasis on leadership succession
5.  Strong relationships with the local community

Future postings will explain the results of our research: check back to discover what behaviors are unique to long-lived firms!