In Search of Excellence is an international bestselling book written by Tom Peters and Robert H. Waterman Jr. First published in 1982 it is one of the biggest selling and most widely read business books ever, selling 3 million copies in its first four years, and being the most widely held library book in the United States from 1989 to 2006 (WorldCat data). The book explores the art and science of management used by leading 1980s companies with records of long-term profitability and continuing innovation.
In Search of Excellence did not start out as a book, as Tom Peters explained when interviewed in 2001 to mark the 20th anniversary of In Search of Excellence: Peters and Waterman were both consultants on the margins of McKinsey, based in the San Francisco office. In 1977 McKinsey director Ron Daniel launched two projects; the first and major one, the Business Strategy project, was allocated to top consultants at McKinsey's New York corporate HQ and was given star billing. Nothing came of it. The second 'weak-sister' project (as Peters called it) concerned Organisation - structure and people. The Organisation project was seen as less important, and was allocated to Peters and Waterman at San Francisco. Peters travelled the world on an infinite budget, with licence to talk to as many interesting business people he could find about teams and organisations in business. He had no particular aim or theory in mind.
In 1979 McKinsey's Munich office requested Peters to present his findings to Siemens, which provided the spur for Peters to create a 700-slide two-day presentation. Word of the meeting reached the US and Peters was invited to present also to PepsiCo, but unlike the hyper-organised Siemens, the PepsiCo management required a tighter format than 700 slides, so Tom Peters produced the eight themes.
As early as 1984 it was apparent, to certain analysts, that the book's choice of companies was poor to indifferent. Business Week ("Oops. Who’s excellent now?", November 5, 1984) observed that of 43 'excellent' companies one-third were in financial difficulties within five years of Peters and Watermans' surveys. The failings were particularly obvious in the high technology sector, where companies such as Atari, Data General, DEC, IBM, Lanier, NCR, Wang Labs, Xerox and others did not produce excellent results in their balance sheets in the 1980s.
Rick Chapman titled his book on high-tech marketing fiascoes, "In Search of Stupidity," as a nod to Peters's book and the disasters that befell many of the companies it profiled. He notes that "with only a few exceptions... [the excellent companies were] large firms with dominant positions in markets that were senescent or static."
In an article in Fast Company, cited below, Peters remarked that the criticism that "If these companies are so excellent, Peters, then why are they doing so badly now," in his opinion "pretty much misses the point."
In December, 2001, Fast Company printed an article, crediting Tom Peters as author, entitled Tom Peters's True Confessions. Most of the "confessions" were humorously self-deprecating remarks (In Search of Excellence had been "an afterthought... a hip-pocket project that was never supposed to amount to much"). One of them was, however, used the term "faked data:"
BusinessWeek ran an article about Fast Company's article. As related by BusinessWeek, the article was actually written by Fast Company founding editor Alan M. Webber, based on a six-hour interview with Peters. Peters reviewed and approved the article prior to publication, but the actual phrase "we faked the data" was Webber's, and Peters had not actually used these words during the interview. BusinessWeek quoted Peters as saying "Get off my case. We didn't fake the data." According to BusinessWeek, Peters says he was "pissed" when he first saw the cover. "It was his [Webber's] damn word," he says. "I'm not going to take the heat for it.