The hallways were hushed in the morning. The décor of the third floor, which housed Koch’s executive suites, had barely changed in twenty years. The doorway to the executive suite was near the elevator bank. Walking inside that door, Charles Koch passed into a spacious lobby. There was a couch, a table, and a small bookcase across from the desk where his assistant sat. Beyond the desk was the doorway to his office. And to the left, on the other side of the lobby, was the entrance to the corporate boardroom, the site of countless strategy sessions and battles over the decades.
As he walked to his office, Charles Koch passed a sculpture. It was a bust of his father’s head, mounted on a tall pedestal, surrounded by decorative plants. It looked like a monument to a nation’s founder. It had been fifty years since Fred Koch died and Charles took over the family company. Fred Koch, that difficult and driving man, was now safely enshrined in the form of a memorial, a silent bust. The man who had encouraged his sons to wear boxing gloves and fight one another, the man who forced Charles Koch to dig weeds in the family yard with a spoon, the man who sent Charles to military school, who used guilt to drag Charles back home to Wichita to run the business, that man was gone. There was only the memory of him—a memory that was shaped and cultivated by his son Charles. Every year in September, Charles Koch hosted the “Founder’s Day” memorial event, where he talked about his father’s legacy. He wrote about his father and produced videos about his father. He controlled the narrative. And one part of the narrative that Charles Koch didn’t emphasize, maybe because he didn’t have to, was that Charles’s achievements had surpassed his father’s. Fred Koch left behind a company that was a motley assortment of assets—a cattle ranch, a share in an oil refinery, a gas-gathering business. Charles Koch fused them together. Charles was the one who invented Koch Industries. Fred Koch published a political tract and sold it through mail order. Fred Koch cofounded the John Birch Society, a paranoid, marginal political group that dissolved into obscurity. Charles Koch wrote his own political tracts and two books on Market-Based Management, one of which was a national bestseller. Charles Koch built a political network that was arguably more influential than any other in corporate America. Reporters and authors traveled from around the country, seeking an audience with Charles Koch. His political pronouncements made the evening news.
Everything Fred Koch accomplished, Charles Koch surpassed.
And while he might not admit to this fact, Charles Koch must have been aware of it, on some level, as he passed that bust of his father. He walked past the receptionist’s desk and into his familiar office. He walked past the small leather couch and coffee table, past the walls with their built-in bookshelves that held his personal library. His desk was still in the same spot, over by the window. It was not uncommon for Charles Koch to arrive at his desk just after dawn.
When he sat down, Charles Koch could turn his head to take in a sweeping view of the Kansas horizon. This view had changed over the last decade or so. It wasn’t all empty space now. There was a public-school building just north of Koch headquarters and some suburban neighborhoods to the northeast. But the landscape changed only because Charles Koch had allowed it to change. He owned virtually all the land he could see, out to the horizon. He had purchased the acreage over time, at reasonable prices. He donated the land on which the public school sat to clear the way for its construction. When Charles Koch gazed out his window, he saw a landscape that he controlled.
If this control was like a gravitational field—shaping everything within it—then the epicenter of the field was the Koch Industries campus. The campus extended north, surrounded by the large wall that bowed out in a horseshoe shape with trees planted along its length. Within the wall was the vast parking lot, which started to fill with cars very early in the morning. Charles Koch could sit at his desk and watch the employees get out, filing into the entrance of the underground pedestrian tunnel that brought them into the Tower. As they walked through the tunnel, the employees passed the mounted collages with black-and-white photos of the Koch family history. When they reached the elevator bank below the Tower, they stood near the large portrait of Charles Koch, smiling. The portrait was composed of tiny photos of Koch Industries employees, as if Charles Koch himself incorporated all of them.
* * *
Every quarter, the business leaders from Koch’s various divisions came to the Tower to report to Charles Koch. When it was time for such meetings, Charles could rise from his desk and walk across the small lobby into the boardroom, where the senior leadership team was seated around the large circular table. The boardroom was still spartan in its decoration. The puffy leather office chairs were unremarkable. The only extravagance was the leather coasters placed at each seat at the table, emblazoned with the company logo. Extra chairs lined the outside wall of the windowless room, providing seats for any support staffers.
Charles Koch sat and listened as his business leaders explained their most recent quarter. He interrogated them and looked for soft spots in their presentations. It was always understood that chaotic market forces were slamming against their front door, and everyone would be accountable for their reactions. If a division lost money, the division’s president needed to provide a detailed vision for regaining profits over the long term.
In 2018, as he listened to the division heads make their presentations, Charles Koch oversaw a corporation that seemed to vindicate his every belief. Entire, massive, profitable units of the company did not even exist in 2000, when Charles Koch launched a turnaround effort after the disasters of the 1990s. Georgia-Pacific, for example, was generating over $1 billion in annual profits, on average. The Koch Fertilizer division, the result of one risky bet in 2003, was delivering billions in revenue each year. Then there was Molex, the microchip company, and Guardian Industries. Charles Koch could make the case that his company wasn’t just perpetually growing, but perpetually transforming as well, entering new industries, abandoning the old, always searching for the next opportunity. And bolstering these experimental efforts were the reliable cash cows. The Pine Bend refinery, still refining cheap crude and selling expensive gasoline, throwing off cash around the clock. And now Corpus Christi, repeating the same trick thanks to the fracking revolution. And the trading division, still selling derivatives, still trading in markets where it had an unparalleled view into real-time shipments and inventories.
Charles Koch’s beliefs would have been validated in another way during these meetings. Senior leaders at Koch Industries phrased everything they said in the vocabulary of Market-Based Management. One of Charles Koch’s indisputable accomplishments over the preceding thirty years was creating an organization where every employee—to a person—publicly subscribed to the same intricately encoded philosophy. Division heads who came to Wichita spoke in terms of mental models and discovery processes and the five dimensions. They talked about integrity. Decision rights. Challenge processes. Experimental discovery. Virtues and talents. These weren’t dog whistles or catchphrases. They were the internal vocabulary of Kochland. Learning them was the first condition to winning a seat at the table. Downstairs, on the first floor of the Tower, the hallways were lined with classrooms where new recruits sat around circular tables during daylong learning sessions, memorizing this vocabulary and learning the rules of MBM. As Charles Koch himself put it, the new recruit either subscribed to this philosophy entirely, or they left Koch Industries. There was no halfway.