Reflections on the 40th anniversary of the Business Guru

This month sees the 40th anniversary of a landmark business book. It created an entirely new genre, and ushered in new formats of communication. It helped changed the way #management sees itself, and how managers manage.?We’ve become so used to these clichés, we forget how they evolved. Today I'm celebrating the birth of the modern Business #Guru.

Let’s have a look.

In October 1982, Tom Peters and Robert Waterman, who were both McKinsey employees, published In Search of Excellence. Peters has said the publisher Harper and Row had such low expectations for it, they ordered a print run of just 5,000. By a conservative estimate, it has sold 8 million copies, not counting pirate editions. Peters describes himself as the “best selling business author of all time”, and that’s hard to dispute.?It became a must-buy for managers in the 1980s and 1990s.

Why was it important? Let’s have a look.

Business best-sellers in the 1970s, before Peters, focussed on corporate corruption and scandals. They were written by investigative journalists. The reputation of managers in America was in the dumps. Managers and executives bought them to learn from other executives’ mistakes. While the books like Up The Organisation and The Peter Principle explained that many functions and managers were incompetent.

But after the election of President Ronald Reagan, business needed a new narrative, and Peters helped shape this. Instead, managers would become American heroes. Peters did this by importing the TV evangelist's promise of self-transformation into a general, secular context. You could transform yourself, Peters promised, and save the business!?

There are some amusing stories about the phenomenon, recounted in Professor David Collins of 英国诺森比亚大学 , in his new book The Emptiness of Business Excellence: The Flawed Foundations of Popular Management Theory, forty years on. You can find it here - and I highly recommend it. Unlike most academic books, it’s a great read.

Peters and Waterman chose a set of outstanding companies who they explained, embodied "excellence". They claim to have chosen exemplar companies "scientifically", but it turned out this wasn't true. There was nothing particularly outstanding about them. They had not performed better than the Fortune 100 mean, whatever metric you decided to use. Within a year or two, some were in trouble. Corruption scandals and racist and anti-semitism hiring policies were unearthed. As one subsequent academic study noted, these firms were chosen because they found the time to talk to the authors, not because they were outstanding organisations.

But Peters was lucky in two ways.?

One was that the “excellence” that Peters wrote about was so slippery and elusive, it largely evaded academic analysis. For example, he advised managers to “stay close to their customers”. And to avoid having many levels of corporate bureaucracy. These are not original insights. But I doubt if Peters had called his book In Pursuit of the Bleeding Obvious, it would have sold many copies. Peters' critics found that analysing it was like to trying to capture air with a fishing net.?

Fortunately for Peters, too, the evangelical treatment meant readers overlooked the emptiness and the flaws. What Peters called "the Excellence Project" became a kind of cult, with Peters as a sort of cult-leader. Managers were encouraged to become disciples themselves. As I argue in my column in today's The Telegraph , this has proved very divisive: you are either with the Latest Thing, or not. Skills of cool analysis and critical thinking have become deprecated.

And you may have wondered what happened to executive narratives, which used to be so popular? Many people are interesting to read how an executive meets challenges - and the struggles they faced, stories told with some honesty. Instead, business books offer bite-sized gobbets of “wisdom”, distilled into a punchline or a meme. Today the formula eschews narratives, and hero narratives completely.?It's become very tiresome and cliched.

Perhaps today, with so many echoes of the 1970s, such as inflation and stagnation, perhaps business books will become critical and sceptical again? The end of the era of cheap money caused by artificially low interest rates will have many casualties, and I hope the business guru - the cult leader who spouts vacuous clichés - is one of them.?But then I'm an optimist!

You can read more in my Telegraph column today.