The World’s MostAdmired Companies

F E A T U R E

Every year since 1997 FORTUNE has

published a list of the world’s most

admired companies. The full list

is available at: http://fortune.com/

worlds-most-admired-companies

We thought it would be interesting

to take a look at the top 10, and

unpack what it is that makes

them so admired. How do the

FORTUNE results tally with other

sources of information such as

customer satisfaction benchmarks,

brand perception studies, and

employment surveys? What is it that

makes an organisation admired by

its peers? What can we learn from

the success of these businesses?

The Methodology

• The list is based on a survey of executives at eligible companies and financial analysts, to understand

which companies have a good reputation within their own industries and across industries.

• Companies need to be among the biggest in their industry, with revenues of $10 billion plus.

• 15,000 people invited to take part from 476 US companies and 199 companies in 28 other countries.

• Companies are rated on 9 attributes, with the overall reputation score being an average of the 9.

1. Innovation

2. People Management

3. Use of Corporate Assets

4. Social Responsibility

5. Quality of Management

6. Financial Soundness

7. Long-Term Investment Value

8. Quality of Products/Services

9. Global Competitiveness

• The “all-star” list is rated separately from the industry lists, and reflects cross-sector reputation –

each respondent chooses the 10 companies they admire most (in other words you can be an all-star

without being most admired within your own industry).

16 Customer Insight Spring 2019 | www.tlfresearch.com

The World’s MostAdmired Companies

1 https://www.theacsi.org/2 https://www.instituteofcustomerservice.com/uk-customer-satisfaction-index

1. Apple OVERALL SCORE (FROM INDUSTRY PEERS): 8.4

Of course it’s Apple. Apple is the world’s largest information

technology company, and its third largest mobile phone

manufacturer. The iTunes store is the world’s largest music retailer.

It’s the world’s most valuable brand. It tops the personal computers

sector in ACSI1, and is regularly quoted for its high NPS and customer

loyalty. In the most admired survey respondents ranked it first in the

industry for all nine attributes (as shown in the diagram).

2. Amazon OVERALL SCORE: 8.3

The other giant of our times, Amazon is the largest internet

company in the world. Like Apple it straddles different industries

from consumer electronics to retail and entertainment, although it’s

arguably even more ambitious in terms of publishing and creating

video content for its entertainment channels.

Customers love Amazon. It tops the internet retailers sector

in ACSI (2 points above Apple in that sector), and also scores

consistently near the top of UKCSI2. But it’s important to remember

that Amazon is much more than an online retailer and streaming

service. Its cloud platform is the largest in the world, and it is

constantly pushing into new markets, most recently with the launch

of “Haven” - a healthcare joint venture with Berkshire Hathaway

and JPMorgan (also members of the top 10).

3. Berkshire Hathaway OVERALL SCORE: 7.7

Although not a household name, Berkshire Hathaway is the third

largest public company in the world. It’s best known because of

its Chairman, Warren Buffet, who is regarded with reverence as an

investor of oracular wisdom. Buffet is famous for “value investing”,

i.e. buying stocks that seem undervalued, but in reality his approach

has been to find companies that he believes will offer long-term and

sustainable competitive advantage at a fair price. If this magazine had

a motto for investors, it would probably be his “It’s better to buy a

great company at a fair price, than a fair company at a great price.”

4. Walt Disney OVERALL SCORE: 8.4

When we think of Disney, we tend to think of Mickey Mouse and

Disneyland, but the entertainment behemoth has grown far beyond

that. With existing revenues of $60 billion, its 2019 acquisition of

21st Century Fox will make it even more powerful. It also seems to

be committing to the Disney+ streaming service, and will not be

renewing its contract with Netflix after 2019.

Innovation

Walt Disney’s industry rank

Use ofCorporateAssets

PeopleManagement

SocialResponsibility

Quality ofManagement

FinancialSoundness

Long-TermInvestment

Value

Quality ofProducts/

Services

GlobalCompetitiveness

2

11

2 1

11

1 1

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

Innovation

Apple’s industry rank

Use ofCorporateAssets

PeopleManagement

SocialResponsibility

Quality ofManagement

FinancialSoundness

Long-TermInvestment

Value

Quality ofProducts/

Services

GlobalCompetitiveness

1

11

1 1

11

1 1

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

Innovation

Berkshire Hathaway’s industry rank

Use ofCorporateAssets

PeopleManagement

SocialResponsibility

Quality ofManagement

FinancialSoundness

Long-TermInvestment

Value

Quality ofProducts/

Services

GlobalCompetitiveness

31

3

2 1

6

1

1 1

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

www.tlfresearch.com | Spring 2019 Customer Insight 17

F E A T U R E

5. Starbucks OVERALL SCORE: 7.9

A successful Seattle business in the 1980s, Starbucks has seen

almost unbelievable growth since the early 1990s. At its IPO in 1992

Starbucks had 140 outlets, and revenues of $73.5 million. That’s now

more than 27,000 locations across 76 countries, with a revenue of

over $20 billion. Unlike other businesses in this list, it doesn’t top its

category in ACSI, although its score of 78 is above the overall average

of 76.6.

6. Microsoft OVERALL SCORE: 8.2

I am, of course, typing this using Microsoft software on a Microsoft

operating system. I’m not using Microsoft hardware, but I might be.

Microsoft is the most valuable public company in the world, and it

continues to dominate the world of software. Given previous misfires

in consumer electronics, the success of its Surface range is notable,

and the Xbox continues to slug it out with Sony’s Playstation for the

console market.

Innovation

Starbuck’s industry rank

Use ofCorporateAssets

PeopleManagement

SocialResponsibility

Quality ofManagementFinancial

Soundness

Long-TermInvestment

Value

Quality ofProducts/

Services

GlobalCompetitiveness

1

12

1 1

11

12

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

Innovation

Microsoft’s industry rank

Use ofCorporateAssets

PeopleManagement

SocialResponsibility

Quality ofManagement

FinancialSoundness

Long-TermInvestment

Value

Quality ofProducts/

Services

GlobalCompetitiveness

1

21

2 1

21

1 1

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

Innovation

Netflix’s industry rank

Use ofCorporateAssets

PeopleManagement

SocialResponsibility

Quality ofManagement

FinancialSoundness

Long-TermInvestment

Value

Quality ofProducts/

Services

GlobalCompetitiveness

1

22

1 2

43

6

2

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

7. Alphabet OVERALL SCORE: 8.2

Alphabet is Google’s holding company, created in 2015. For 2 brief

days in 2016, Alphabet was the world’s most valuable publicly traded

company, before Apple took back the lead. With a radically different

business model from most of the other top 10, Alphabet’s 2017 annual

report shows that 86% of its revenues are from advertising. Google

tops the search engines sector on ACSI, and comes in at number 5 in

YouGov’s BrandIndex, showing its strong position with consumers.

8. Netflix OVERALL SCORE: 7.6

Over 148 million people worldwide subscribe to Netflix, which has

grown from its roots as a DVD rental service by mail to not just the

dominant streaming service, but also a significant content creator

(with a haul of Emmys and even an Oscar in the trophy cabinet).

Netflix is an enormous global business, with revenues of over $15

billion, but its cultural impact is hard to quantify. It has changed the

way we watch TV, the formats that will work, and the funding models

that support new shows, and we love it. It tops the new streaming

services sector of ACSI, and is number 2 in BrandIndex.

18 Customer Insight Spring 2019 | www.tlfresearch.com

F E A T U R E

Innovation

FedEx’s industry rank

Use ofCorporateAssets

PeopleManagement

SocialResponsibility

Quality ofManagement

FinancialSoundness

Long-TermInvestment

Value

Quality ofProducts/

Services

GlobalCompetitiveness

2

22

2 2

22

2 2

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

Innovation

JPMorgan Chase’s industry rank

Use ofCorporateAssets

PeopleManagement

SocialResponsibility

Quality ofManagement

FinancialSoundness

Long-TermInvestment

Value

Quality ofProducts/

Services

GlobalCompetitiveness

1

12

1 1

21

1 1

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

9. JPMorgan Chase OVERALL SCORE: 7.1

The largest bank in the US has two colossal subsidiaries – JPMorgan

looking after investment banking, wealth management, etc; and Chase

as its consumer and commercial banking proposition. It remains a

megabank in a world which, after 2008, is understandably suspicious

of banks which are seen as “too big to fail.” JPMorgan Chase emerged

from the storm in a relatively strong position (what the CEO Jamie

Dimon famously described as a “fortress balance sheet”). Whatever

the regulatory landscape, this is a company committed to the benefits

of size and broad scope.

Chase is ranked 4th by consumers in its sector on ACSI, a

surprisingly fragmented sector with the number one spot taken by

“All others”.

10. Fedex OVERALL SCORE: 6.5

Fred Smith came up with the initial concept that underpins FedEx’s

success while he was an undergraduate at Yale. He saw that speed was

increasingly important, a need which only air transport could meet,

but that the existing air cargo industry was out of date and inflexible.

In a paper he proposed a new model, with one carrier looking after

the package from pick-up to delivery, operating all its own aircraft

and vehicles. Legend has it he was given a C, but whatever his grade

Smith stuck with his idea. In the early 1970s he started building the

business, now with revenues over $65 billion.

Compared to the other all-star companies, FedEx is not rated all

that strongly by its peers (ranking 2nd for every attribute), and with a

relatively low average score of 6.5. Its appearance on the all-star top

10 shows that it’s more admired by those outside the industy.

Conclusions

• What can we learn from the most admired companies? Well, it helps to be a colossal US corporation…but there’s not much most of us can do to

emulate that. There’s a notable dominance for companies which own marketplaces (Amazon/iTunes/Alphabet) and publishing (Disney/Amazon/

Netflix).

• There does seem to be a US bias to the results, despite making the effort to include respondents from other countries, but in many respects that simply

reflects the fact that the USA dominated world commerce through the 20th century, and continues to dominate the technology market.

• Are the nine attributes on which the companies are scored the right ones? The list was developed in the mid 1980s, and although they seem pretty

sensible, I wonder if the list would be same if we were starting today?

• Most striking of all, I think, is that although the top 10 feature strongly in ACSI, UKCSI, BrandIndex and other measures of consumer regard, none

appear in the top 20 of FORTUNE’S Best Companies to work for3 or in the Times top 25 Best Big Companies to work for4. I can’t help feeling that’s a

point that some of the new tech giants will need to address if they’re going to be sustainable.

3 http://fortune.com/best-companies/list4 https://appointments.thetimes.co.uk/article/best100companies/

www.tlfresearch.com | Spring 2019 Customer Insight 19