Business Power: Good to Great

Why some companies make the LEAP …
and others don’t

Good to Great, the book by Jim Collins

We don’t have great schools, for we have good schools.
We don’t have a great government, for we have a good one.

Few people attain Great Lives, for it is so Easy to settle for a good life.

In order to define good and great, Jim and his team tried to found a point at which a company transferred from one to the other.

They found a pattern that only 6 companies in US history have in common. To perform good, at the same level as competitors for 15 years, followed by 15 years of performing Great, at a continuous better level as competitors. In a 5 year study, these companies and a control group were then compared.

A pattern emerged that contains some essential and distinguishing factors. The pattern consists of these elements.

 Good is the enemy of Great
Acknowledge that anything less than a Great score is accepting underperforming when related to your potential.

 Build-UP: Level 5 Leadership
Perform optimally at all 5 levels of the Leadership Hierarchy: Highly Capable Individual, Contributing Team Member, Competent Manager, Effective Leader & Executive.
Executive: Builds enduring greatness through a paradoxical blend of personal humility and professional will.

 Build-UP: First Who . . . Then What
First, find the people whom YOU want to work with, then figure out what your Combined Potential is.

 Build-UP: Confront the Brutal Facts
Touch base. Great, by definition, requires some form of judgment, defining the scale and measuring scores and performance.
Do this thoroughly and fairly.

 Breakthrough: Hedgehog Concept
Hedgehogs simplify a complex world into a single organizing idea, a basic principle or concept that Unifies and Guides Every-thing.
The 3 circles are ‘What can you be the best at’, ‘What drives your economic engine’ & ‘What are you Deeply Passionate about’.

 Breakthrough: Culture of Discipline
Keep the excitement of the Entrepreneurial phase alive. Do not kill the company in Rules and Procedures. Avoid Bureaucracy and Hierarchy; Create a Culture of Discipline.

 Breakthrough: Technology Accelerators
Only apply technology to the 3 intersecting circles of the Hedgehog Concept. Use technology accelerate momentum, not to create it.
The results producing application of technology is more important than using the shiniest and fanciest version.

 The Flywheel and the Doom Loop
Good to Great is the result of Every Step, Every Action, Every Decision that impacts your Flywheel, Massive Action adds up to Sustained and Spectacular Results.

An introduction into Unexpected Findings in the 5-year study and the definition of a Level-5 Executive Leader.
Personally, I believe there is Greatness in ALL of us.
All 11 of these companies had Management with Level-5 Leadership qualities. Whereas of the 17 comparison companies, their leaders only attained to level 4.
But first, an introduction to the unexpected findings of this study.
 Always grow from the inside-out. Do not look for external sources (new managers), but look within.
I would say this goes for personal development and building your own life as well. Look inwards, not outwards – for growth.
 Whatever compensation you can come up with, it has no correlation to the results you are getting.
In other words, build for the pleasure of building – not for the compensation.
 Having a strategy is important, what the strategy is – not so much.
Write down how you want to do things. Don’t worry about the validity of it.
 Do not focus on what to do, rather focus on what to no longer do. Eliminate distractions.
Remove actions from your 24 hours that do not produce the results that you are after. Space opens up naturally to do the actions that do give the results you are after.
 Technology is never a creator, merely an accelerator.
Being technology-adept is not a problem, it is only the last step in building a great company – and then only to accelerate what has already been started.
 Mergers & Acquisitions are irrelevant.
Forget about them.
 Pay attention to Managing Change, Motivating People & Creating Alignment; Forget about Commitment, Motivation & Change itself.
It’s a different process with better results.
 These things are not important in the long run: Brand name, tagline, launch event or ‘Program’.
Focus on the results to produce, not on the labels we use to describe them.
 External circumstances are never a factor in Greatness.
Greatness truly shines from within.
Okay then, on to the Level-5 Leaders. What do they have in Common?
Or, to put it into perspective first, here’s a short description of each level.
 1. Highly Capable Individual
Makes Productive Contributions through Talent, Knowledge, Skills & Good Work Habits.
 2. Contributing Team Member
Contributes Individual Capabilities to the Achievement of Group Objectives and Works Effectively with Others in a Group Setting.
 3. Competent Manager
Organizes People & Resources towards the Effective & Efficient pursuit of Pre-Determined Objectives.
 4. Effective Leader
Catalyzes Commitment to & Vigorous Pursuit of a Clear & Compelling Vision, Stimulating Higher Performance Standards.
 5. Level-5 Executive
Builds Enduring Greatness through a Paradoxical Blend of Personal Humility & Professional Will.
The Level-5 Executive uses his/her ego for the greater good, not for self-gratification.
Some other characteristics of these Level-5 Executives are:
 Channel their ego into the Greater Good
 Modest & Willful; Humble & Fearless
 Prepare for the Next Generation
 Gratify the Team instead of Self
 Do what NEEDS to be DONE
 Take Personal Responsibility when things go ‘wrong’
All in all, reading this book brings great inspiration to me for how I am shaping ‘my’ company. Or rather ‘Our company’. As I believe we all exist in ecosystems that are inter-connected.
Each of us is at the center of our own Universe. By working together, empowering each other, producing Great Results, in such a way that other can Build Upon them, propels each of us forward in LIFE.


I definitely recommend reading the book to get the details.


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