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Book: Good to Great

Author:  Jim Collins

Purchase:  Print | eBook | Audiobook

Citation: Collins, J. (2001). Good to great : why some companies make the leap ... and others don't. New York, NY: HarperBusiness.

Three Big Takeaways:
  1. The moment you feel the need to tightly manage someone, you've made a hiring mistake. The best people don't need to be managed. Guided, taught, lead – yes. But not tightly managed. Letting the wrong people hang around is unfair to all the right people, as they inevitably find themselves compensating for the inadequacies of the wrong people. Worse, it can drive away the best people. Strong performers are intrinsically motivated by performance, and when they see their efforts impeded by carrying extra weight, they eventually become frustrated. (pg. 56)

  2. The flywheel image captures the overall feel of what it was like inside the company's as they went from good to great. No matter how dramatic the end result, the good to great transformations never happened in one fell swoop. There was no single defining action, no grand program, no one killer innovation, no solitary lucky break, no wrenching Revolution. Good to great comes about by a cumulative process - step-by-step, action by action, decision by decision, turn-by-turn of the flywheel – that adds up to sustained and spectacular results. (pg. 165)

  3. The comparison companies frequently launch new programs - often with great fanfare and hoopla aimed at motivating the troops - only to see the programs fail to produce sustained results. They sought the single defining action, the grand program, the one killer Innovation, the miracle moment that would allow them to skip the arduous build up stage and jump right to break through. They would push the flywheel in one direction, then stop, change course, and throw it in a new direction – and then they would stop, change course, and throw it into yet another direction. After years of lurching back and forth, the comparison companies failed to build sustained momentum and fell instead into what we came to call the doom loop. (pg. 178)


Other Key Ideas:

A Level 5 Leader is an individual who blends extreme personal humility with intense professional will. They have an ambition first and foremost for the company and concern for its success rather than for one's own riches and personal renown. They want to see the company even more successful in the next generation, comfortable with the idea that most people won't even know that the roots of that success trace back to their efforts. In contrast, the comparison leaders, concerned more with their own reputation for personal greatness, often failed to set the company up for success in the next generation. After all, what better testament to your own personal greatness than the place falls apart after you leave? (pg. 21)

Level 5 leadership is not just about humility and modesty. It is equally about ferocious resolve, an almost stoic determination to do whatever needs to be done to make the company great. They are fanatically driven, infected with an incurable need to produce results. (pg. 30)

There are two categories of people: those who do not have the seed of the Level 5 and those who do. The first category consists of people who could never in a million years bring themselves to subjugate their egoistic needs to the greater ambition of building something larger and more lasting than themselves. The second category of people consists of those people who have the potential to evolve to Level 5; the capability resides within them, perhaps buried or ignored, but there nonetheless. Level 5 Leaders exist all around us. Look for situations where extraordinary results exist but where no individual steps forth to claim excess credit. You will likely find a potential Level 5 leader at work. (pg. 36)

The executives who took their company from good to great did not first figure out where to drive the bus and then get people to take it there. No, they first got the right people on the bus (and the wrong people off the bus) and then figured out where to drive it. They said, in essence, "Look, I don't really know where we should take this bus. But I know this much: If we get the right people on the bus, the right people in the right seats, and the wrong people off the bus, then we'll figure out how to take it someplace great." (pg. 41)

Good to great leaders understood three simple truths. First, if you begin with "who," rather than "what," you can more easily adapt to a changing world. Second, if you have the right people on the bus, the problem of how to motivate and manage people largely goes away. The right people don't need to be tightly managed or fired up; they will be self-motivated by the inner drive to produce the best results and to be part of creating something great. Third, if you have the wrong people, it doesn't matter whether you discover the right direction, you still won't have a great company. Great vision without great people is irrelevant. (pg. 42)

Good to great companies place greater weight on character attributes that on specific educational background, practical skills, specialized knowledge, or work experience. Not that specific knowledge or skills are unimportant, but they viewed these traits as more teachable, whereas they believe dimensions like character, work ethic, basic intelligence, dedication to fulfilling commitments, and values are more ingrained. (pg. 51)

Breakthrough results come about by a series of good decisions, diligently executed and accumulated one on top of another. (pg. 69)

How do you create a climate where the truth is heard? Lead with questions, not answers. Make good use of informal meetings where you ask groups of managers and employees with no script, agenda, or set of action items to discuss. Instead, ask questions like so what's on your mind? Can you tell me about that? Can you help me understand? These non-agenda meetings become a forum where current realities tend to bubble to the surface. (pg. 74)

Most companies build their bureaucratic rules to manage the small percentage of wrong people on the bus, which in turn drives away the right people on the bus, Which then increases the percentage of drunk people on the bus, Which increases the need for more bureaucracy to compensate for the incompetence and lack of discipline, which then for their drives the right people away, and so forth. (pg. 121)

In good to great companies, there was no miracle moment. Although it may have looked like a single stroke break through to those. In from the outside, it was anything but that to the people experiencing the transformation from within. Rather, it was a quiet, deliberate process of figuring out what needed to be done to create the best future results and then simply taking those steps, one after the other, turn-by-turn of the flywheel. After pushing on that flywheel in a consistent direction over an extended period of time, they'd inevitably hit a point of breakthrough. (pg. 169)

The good to great companies understood a simple truth: tremendous power exists in the fact of continued improvement and the delivery of results. Point to tangible accomplishments – however incremental at first – and show how the steps fit into the context of an overall concept that will work. When you do this in such a way that people see and feel the build-up of momentum, they will line up with enthusiasm. (pg. 174)

If you diligently push in a consistent direction on the flywheel, accumulating momentum step-by-step and turn-by-turn, you will eventually reach breakthrough. It might not happen today, or tomorrow, or next week. It might not even happen next year. But it will happen. (pg. 184)

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