Jim Collins: "Those who panic die on the mountain"

Finally getting to my Feb. 2 issue of FORTUNE. There is a terrific interview with Jim Collins, author of Good to Great and other books.

This is a must read piece. Collins addresses questions from FORTUNE's Jennifer Reingold regarding our current global economic crunch and how companies can and should navigate this extremely difficult time.

The thrust of his argument is about values, character.

The interesting point he makes is that the economic prosperity we've experienced since the 1950s is what was unprecedented, pointing a few periods in history with similar golden eras, such as the Egyptian empire or Rome in 200 A.D.

So the anomaly isn't the turbulent times we face, but rather the prosperity we've enjoyed over the past five decades.

As he puts it, "what we're experiencing now, get used to it. It's life, and it's the normal life."

His point is that companies that survived extremely difficult periods of economic uncertainty had certain characteristics. From my vantage point, these qualities are the essence of public relations -- articulating a set of values and then models those values with employees, customers, shareholders and other constituents.

One, a deep fabric of values. He mentions P&G. When faced with difficulty, the company insisted it would not skimp on quality. It cost more, but in the long term it built a stronger relationship with customers and forged its reputation as a quality brand people could trust.

Two, invest in talent. During difficult times, companies like HP post WWII chose to hire engineers laid off from other companies or the government. It proved to be the foundation for the HP Way of the future.

Three, have a quarter-century view, not a quarter-by-quarter view. During tough times, it's easy to go micro, Collins says. We zoom in to tightly manage the current situation yet fail to assess the landscape and make long-term choices. His point is that most executives zoom in, and it's the rare (and successful) execs and companies that have the ability to zoom out. He points to Boeing after WWII. Boeing's revenue was based on the military. Post WWII Boeing had lost 90% of its revenue (staggering). But CEO Bill Allen decided to invest 20 years out in the jet age. What vision.

Four, the results of the company is the responsibility of the employees Sounds obvious, but the point is people have to look at their work not as a job but as a responsibility. At all times, but especially during challenging economic periods, people must deliver on their commitments and actions that support the longevity of the company. It's a personal commitment.

Five, focus on prevailing, not just surviving. His final point is that companies need to make decisions and investments that will enable it to prevail, or gain market-share or come out stronger during the up cycle, not merely survive the down cycle.

And all of this, he sums up, is about our core values that transcend good or bad times, and not deviating from those values in good or bad times.

His final point, and a great one: "Our characters are being forged in a burning, searing crucible."

It is in difficult times that true character reveals who we really are, and what we truly value. And nothing matters more than character. It separates those focused on short term gains (whether personal or political or business) from those focused on enduring, long term values.