What it takes to make 100
Companies come and go, but a few have found a way to stay
The list of 100-year-old companies in the United States is longer than you might think. Among publicly traded companies, there are about 500, according to research from Standard & Poor’s Capital IQ. Yet those 500 are from a list of more than 5,000. You see from the ratio, that 100 years of business is something to celebrate.
Among all firms both privately and publicly held, reaching 100 is a similarly rare feat.
Vicki TenHaken, professor of management at Hope College in Michigan, researches corporate longevity. A few years ago, TenHanken took a broad look at long-surviving companies. She reported that:
The U.S. census data for 2006 [the most recent data available] lists the number of U.S. firms at 6,022,000. Our database of companies over 100 years old is now at 540. This would indicate that only .00897 percent of U.S. firms are over 100 years old.
We know our database is incomplete and we add more firms every week, however it appears unlikely that the percentage of companies over 100 years old would approach even half a percent. (Even if the number of firms in our database doubles, the percentage is still just .0179.)
Firms that do reach 100 should truly celebrate!
MFA, as it enters its 100th year, joins a rarefied group.
You might do a good job of guessing some of the big companies that have reached 10 decades of business. ExxonMobil, General Electric, IBM and others make the list. But what do such firms have in common that has allowed them to stay in business for multiple generations?
In a discussion about her research, TenHanken said that visiting with leaders from corporations that have survived to their centennial reveals bits of wisdom that begin to paint a larger picture. A CIO of Caterpillar said that “culture eats strategy for lunch.” And Forbes publisher Rich Karlgaard suggested that “real purpose”—a moral foundation that supersedes financial foundation—is something that helps a company survive changing times.
In 2014 it is easy to see the same culture that MFA started in 1914 when it was formed by a group of farmers looking for stronger bargaining power.
From the group of people who labor to publish this magazine to buyers of fertilizer, seed specialists, grain merchants, feed makers, precision agriculture techs, the person behind the counter at your retail store and the rest of MFA, there is a distinct underlying purpose—a work-culture instinct—to seek out ways to help farmers succeed. There is a sense that we are all in this business together.
It is hard to put a finger on how that culture has persisted through the years. Part of it is clearly leadership. Those who rise to the top of an organization like MFA are often times promoted from within. A leader at MFA has seen multiple facets of the business, and likely has tenure dealing directly with the farmer customer. Aside from the belief that MFA should help individual farmers succeed, the cooperative’s leadership, from the local manager to the CEO, considers stewardship of the farmer-owned company as part of their charge.
These seem like lofty plaudits to put down in an editorial celebrating MFA’s 100th year. It might sound like self-aggrandizement. As an MFA employee who spent the first part of my career at another company, I can testify that it isn’t. If you spend much time at an Agri Services Center or in the halls of MFA’s home office, you learn and then embrace this culture of stewardship.
Another hallmark of a long-running company is conservative financing. Companies that are frugal and do not capriciously risk capital tend to survive. In these companies, management and employees understand that money is hard to earn and controlling expenses allows flexibility and the ability to be independent from financiers who might wish to tinker with the operation.
MFA has made mistakes in the past. MFA has met unfortunate circumstances. And MFA has firsthand knowledge of financiers who think they might have a better handle on how the company should run. At every turn, though, the culture has survived, and MFA lived on to find prosperity through its roots—laboring with the intention of helping farmers succeed.
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