We reveal our picks for the 9 best classic business books of the past 30 years--and why they're still relevant today.
Opinions expressed by Entrepreneur contributors are their own.
Business authors and experts have proclaimed enough revolutions to fill a long shelf. Most of these turn out more like ripples than tidal waves, as a check of any bookstore's markdown shelves will show. Sure, a few tomes and gurus from the past three decades have made a difference in the way entrepreneurs operate--or at least in what they bring on the plane to read.
But even the rare title with the power to change rarely has much staying power. The speakers who promised to teach American companies to operate like Japanese firms were influential in the 1980s, but imploded in the 1990s along with Japan's bubble economy. Likewise, the 1990s experts who proclaimed an end to the Old Economy lost listeners and credibility when the New Economy's glitter faded in the new century.
Of the thousands of business books published in the last 30 years, only a handful have withstood the assaults of changing times and changing objectives to remain as relevant today as when they first came out. Here are nine worthy of space on any entrepreneur's shelf--now and in the future.
The One Minute Manager (HarperCollins, 1981) by Kenneth H. Blanchard and Spencer Johnson
Why it mattered:The One-Minute Manager was the first mega-best-selling business book and still is popular today. Myriad businesses have issued copies to all managers, and the concept has spawned an array of audio versions, videotapes, seminars and other tools applying the one-minute approach to all kinds of activities.
This slim, 111-page instruction manual is presented in the form of a parable. The narrative follows a puzzled young manager who learns from the wise old One-Minute Manager how to handle the people under his supervision. The brief, easy-reading fable format has been mimicked by countless titles since, but none of the imitators has offered such an easily understood and broadly applicable set of management principles.
Why it still matters: One-Minute Management relies on three foundations: goal setting, praise and reprimands. Each interaction aimed at these objectives should be clear and, importantly, take just 60 seconds to impart. This simple, straightforward approach worked then, and people haven't changed all that much, so it still works now.
What to ignore: Blanchard and Johnson recommend physically touching employees when praising them. They do warn you should only touch employees you know well, but this advice still seems riskier today than in 1981. It's best to respect everyone's space and keep your hands to yourself.
Out of the Crisis (The MIT Press, 1982) by W. Edwards Deming
Why it mattered: Deming introduced statistical methods for quality measurement and improvement in post-war Japan, guiding its rise to manufacturing superstardom. In the 1970s, U.S. business leaders worried about Japanese inroads asked Deming for help, beginning the quality revolution here.
Deming's teachings challenged American business practice at almost every point. Among his most revolutionary ideas were the notions that poor management--not slacker workers--was responsible for most quality problems, and the way to boost quality was to carefully measure defects and the effects of changing processes.
Why it still matters: Although much low-hanging, quality-management fruit has been picked, increasingly rigorous applications of Deming's theories--notably the approach called Six Sigma--can still provide significant advantage over less disciplined competitors.
Deming's famous 14 points of management address matters far-removed from the statistical methods he's most remembered for. Among other things, he strongly advocated a customer focus, using market demands to define the standards of good quality, long before it was popular.
What to ignore: Deming's embrace of Japanese culture endeared him to his hosts, but his approach to teaching American managers was bluntly critical. That alienated many who might have benefited from his concepts. Also, in part because of his early experiences working in an electrical assembly plant, he was strenuously opposed to incentive pay plans of all types.
In Search of Excellence (HarperBusiness Essentials, 1982) by Thomas J. Peters and Robert H. Waterman
Why it mattered: The era of the celebrity business author began with this 1982 title exploring the secrets of a group of high-performing companies. While several of the supposedly excellent profiled firms soon stumbled--some badly, bringing heaps of criticism on the authors--the authors' ideas did beneficially refocus the business world's attention on some neglected topics.
Peters and Waterman's most lasting recommendation, which was surprisingly unconventional in its day, was to get and stay close to customers. They also lauded entrepreneurs and entrepreneurial management in an era when big companies and hidebound management practices were all the rage.
Why it still matters: Read In Search of Excellence, first, because so many of your rivals and peers already have. Not counting bite-sized parables like The One Minute Manager, it's the most popular general management book of our time and, very likely, the single most influential.
Another reason to read the book is that, despite the hard times many of its profiled companies encountered, its criteria for success still remain valid. Trying new things, learning from your mistakes--having a "bias for action," in the authors' words--and taking good care of employees are still solid approaches to making business work.
What to ignore: Beware the cult of gurudom that sprang up around Peters and, to a lesser extent, his co-author. Despite their adulation, both have admitted significant flaws in this first book. And Peters, particularly, has been prone to repudiate his earlier ideas with each successive book. In short, take what they say with a grain of salt.
Guerrilla Marketing, Innovation and the E-Myth
Guerrilla Marketing (Houghton Mifflin, 1983) by Jay Conrad Levinson
Why it mattered: No author is better loved by entrepreneurs. Levinson's advice for low- and no-cost small-business marketing has been updated and expanded in three editions since the original. Dozens more books authored and co-authored by him apply the guerrilla approach to finance, sales and other functions.
The importance of Guerrilla Marketing lies in its practicality and frugality. Marketing as taught before Levinson emphasized techniques requiring resources beyond growing businesses' reach. Levinson looked past national broadcast campaigns to point out how to market with tools such as business cards, public relations and telephone hold recordings.
Why it still matters: Levinson's central lesson is that marketing opportunities are everywhere and don't have to cost a fortune. He opens your eyes so that, in addition to getting some specific marketing tricks, you're better prepared to invent your own. Anyone who reads a Guerrilla book comes away convinced that big ideas are worth more than big money. In that sense, Levinson is perhaps the ultimate entrepreneurial author.
What to ignore: If you pick up an old edition, you'll find lots of references to telemarketing and direct-mail campaigns and none to e-mail marketing or e-commerce. Marketing and business have changed a lot since 1983, something that Levinson's later books recognize by devoting attention to such modern issues as environmentalism, telecommuting and satellite communications.
Innovation and Entrepreneurship (HarperBusiness, 1985) by Peter Drucker
Why it mattered: Drucker was regarded as the top management thinker of the 20th century when he died in 2005 at age 95, at work on yet another book. His reputation was built mostly with titles other than Innovation and Entrepreneurship, and those were primarily about big companies, reflecting his early studies with General Motors. This title was the only one dealing specifically with entrepreneurship, but it did much to legitimize entrepreneurial styles of management when it came out.
Why it still matters:Innovation and Entrepreneurship proposes an approach to fostering innovation unlike any book that came before it. Among Drucker's most telling observations was that opportunity often lies in incongruity. When a process doesn't make sense or work for the benefit of customers, entrepreneurs who find and effectively present solutions will prosper, he found.
In addition to incongruity, Drucker identified six more sources of innovation, from demographic changes to the introduction of new knowledge, and outlined timeless business strategies based on speed, nichemanship and other attributes of entrepreneurial businesses.
What to ignore: Drucker was an outstanding writer, able to compellingly impart insights to a wide range of readers, but his observations are largely anecdotal. Today, business authors and analysts increasingly lean more on empirical data gathering and quantitative analysis for formulating their recommendations. Drucker is always clear, inspiring and thought provoking, but that doesn't mean his ideas will work for everyone.
The E-Myth (HarperBusiness, 1985) by Michael Gerber
Why it mattered: This small-business consultant's sharpest observation was that most business owners know a lot about producing whatever it is they sell, but a lot less about running the business. The publication and popularity of this book and Gerber's numerous titles that followed it caused countless business owners to reexamine what they were doing.
Gerber's mantra of "Work on your business, not in your business" powerfully refocuses the business owner's attention away from being what amounts to self-employed employees and toward figuring out how to make their small companies run better. Essentially, he advised systematizing as many jobs as possible through the use of manuals, policies and the like, until practically anyone could run the business as well as the founder.
Why it still matters: Especially in his later E-Myth Mastery, Gerber lays out an approach to systematizing a growing business unmatched in scope and sophistication. Growing a company much beyond the capabilities of its creator still requires skills beyond that of a technician. Gerber's work is the prime repository of that knowledge for businesses.
What to ignore: Focusing on growing a company using these highly intellectual techniques can lead entrepreneurs far from hands-on producing and creating, which in many cases is why they started a business. As with a lot of powerful ideas, you have to ask yourself where you really want to go before trying to apply this one.
Effective Habits, Reengineering and Longevity
The Seven Habits of Highly Effective People (Free Press, 1989) by Stephen Covey
Why it mattered: One of the best-selling, non-fiction titles ever, Covey's book camped on The New York Times best-seller list for five years. Anything but a simple read, his approach to success melded a highly structured approach with what amounted to good, old-fashioned values. Unlike the typical self-improvement author, Covey didn't promise quick results. Instead, he laid out a long-term program of study with many prerequisites before graduation.
He also brought home as no one before the importance of balancing personal and business achievement. His treatment of effectiveness was holistic, calling for as much or more effort to go into the inner entrepreneur as the outer enterprise.
Why it still matters: Like In Search of Excellence, Covey's book is almost required for any entrepreneur who wants to consider himself or herself well read. Also, Covey started his work on the book by studying the success of literature going back more than 200 years. As a result, it's based less on changeable factors like technology or competition and more on relatively immutable personal human values.
What to ignore: The Seven Habits, and especially the self-management systems that have since been energetically marketed by the Franklin Covey firm, are based on common sense that even Covey admits many people already have. If you're satisfied with your life and your leadership, there's no need to dedicate yourself to this program.
Reengineering the Corporation (HarperBusiness, 1993) by Michael Hammer and James Champy
Why it mattered: Hammer and Champy came along with a radical, startling prescription for overhauling businesses wholesale. "Don't innovate--obliterate!" was one of the phrases of their gospel. It opened eyes to the possibility that business had gone very wrong by adopting operational policies that were more inefficient than innovative.
Their primary declaration was the need for businesses to identify their most important processes and get as good at those as possible. Among other changes they called for was tearing down the silos that separated functions in most companies.
Surprisingly, for a book based on the relatively dry field of operations research, Reengineering the Corporation turned out to be one of the best-selling business books ever, and buzzwords from it were inescapable in the first half the 1990s. While not as influential as it once was, it was prominent during its heyday as few business books have been.
Why it still matters: Though many companies have been at it a decade or more, refining business processes remains a valuable route to differentiation. Getting more done with fewer people, in less time and with less cost will provide a competitive advantage.
What to ignore: This book is the most controversial of these nine classics, largely because corporate cost-cutters hijacked their reengineering prescription and used it to disguise and justify mass layoffs. Ignoring the human cost of any measure can doom an entire reengineering project. While reengineering may entail job losses, it doesn't have to; there are many other cost-cutting measures whose human costs are less severe.
Built to Last (HarperCollins, 1994) by Jim Collins and Jerry Porras
Why it mattered: Pairing iconoclastic recommendations with lots of research and careful analysis, this book started Collins on his way to becoming probably today's most widely read and influential business writer. The approach resembled In Search of Excellence--the authors picked 18 visionary companies that had survived an average of 50 years and attempted to dissect what made them so long-lived. One improvement over the approach taken in In Search of Excellence was that in Built to Last, Collins and Porras compared their companies with more pedestrian companies. Visionary company Hewlett-Packard, for instance, was set against Texas Instruments.
The co-authors dismantle many longstanding beliefs, including that successful businesses must be founded by charismatic leaders. It's more important, they said, to have strong core values and extremely ambitious goals.
One of the book's most appealing attributes is a highly readable writing style. Despite the authors' analytical bent, the text flows like a fictional narrative. And the positive tone suggests that if these companies can do it, you can, too.
Why it still matters: Collins and Porras have more traction at this moment than any others on this list. Collins' second book, Good to Great, written without Porras, was if anything better received than Built to Last. To get up-to-date with business thought leaders, look to Collins' works.
What to ignore: Much space goes to describing the mass of data they assembled and the rigor of their methods, which included using a control group to help validate results. Still, don't treat their findings as immutable truth. These are good ideas and inspiring tales, but in the end, each entrepreneur has to create his or her own success story.