Good to Great – Personal Development Book Review
A Fascinating Take on Business Success
I’ve become kind of obsessed with Jim Collins‘ research-based books on business. They’re fascinating because they take the incredibly complex world of business, and rigorously identify exactly what makes some organizations so successful. The findings are often surprising and illuminating.
Jim Collins sold more than 3 million copies of “Good to Great: Why Some Companies Make the Leap… and Others Don’t,” and I can see why. He has a knack for taking the dry topic of business analysis, and turning it into a compelling drama that’s both thought-provoking and empowering.
Improvement is Possible
“Good to Great” is empowering because it’s optimistic and inclusive. Collins explains his book isn’t just about businesses, but also organizations, governments, schools, households, and individuals. But his research focuses on publicly traded companies, because the data is readily accessible. Collins says his team’s 5-year research project resulted one giant conclusion that stands above the others: “We believe that almost any organization can substantially improve its stature and performance, perhaps even become great, if it consistently applies the framework of ideas we’ve uncovered.”
The research team carefully chose “a total study set of 28 companies: 11 good-to-great companies, 11 direct comparisons, and 6 unsustained comparisons.” The good-to-great companies were defined by a long buildup period, followed by a sustained breakthrough of great performance, in which the companies beat the general stock market by at least 3 times cumulatively over the course of the next 15 years. A few examples of good-to-great companies in the book are Wells Fargo, Walgreens, Kroger, Circuit City, Phillip Morris, and Gillette. This book was published in 2001, and some of the good-to-great companies have since experienced decline, while others have remained strong. Whether or not these companies maintained their greatness long-term, all of them were able to sustain it for at least 15 years after their breakthrough.
Colins says the good-to-great companies were motivated by their own high standards and sense of what’s possible. He explains, “those who turn good into great are motivated by a deep creative urge and an inner compulsion for sheer unadulturated excellence for its own sake. Those who build and perpetuate mediocrity, in contrast, are motivated by the fear of being left behind.”
Keys to Greatness
The following list is a framework of the intriguing keys-to-success covered in “Good to Great.” For much more comprehensive explanations, with examples from Collins’ research, see the book or audiobook.
Level 5 Leadership. Collins says that the good-to-great companies have “level 5 leaders” who are highly capable individuals, team members, managers, and leaders. But on top of all that, they build “enduring greatness through a paradoxical blend of humility of professional will.” Collins says Level 5 Leaders embody a concept he calls “The Window and the Mirror.” He explains, “level 5 leaders look out the window to apportion credit to factors outside themselves when things go well (and if they cannot find a specific person or event to give credit to, they credit good luck). At the same time, they look in the mirror to apportion responsibility.” Also, Level 5 Leaders ask really good questions, and they are ambitious first and foremost for the company.
First Who… Then What. The good-to-great companies prioritized hiring and retaining the right people. Collins concluded having the right people in place is even more important than the specific goals of the company.
Confront the Brutal Facts (Yet Never Lose Faith). This concept is especially interesting to me. It’s about persisting through back luck and unfortunate circumstances. Collins calls this duality of confronting the brutal facts, yet never losing faith “the Stockdale Paradox,” named in honor of a prisoner of war who survived his predicament, Admiral Jim Stockdale. Collins says “the Stockdale Paradox is the ability to “retain faith that you will prevail in the end, regardless of the difficulties, AND at the same time have the discipline to confront the most brutal facts of your current reality.”
The Hedgehog Concept. Collins illustrates “the Hedgehog Concept” with the metaphor of a hedgehog protecting itself from a hunting fox by rolling itself into a prickly ball. He further explains, “the good-to-great companies are more like hedgehogs – simple, dowdy creatures that know “one big thing” and stick to it.” Furthermore, that one big thing should be something that combines passion, profit, and best-in-the-world excellence. The Hedgehog Concept really has me thinking. It’s a tall order, and it reminds me of the Japanese concept “Ikigai,” which involves combining what you love, what you can be paid for, what you’re good at, and what the world needs.
A Culture of Discipline. The good-to-great companies all exhibited a culture of disciplined people, thought, and action. This idea stands out to me in a big way. It seems like discipline is key to getting things done in many areas of life, including business.
Technology Accelerators. Collins says the companies in the successful study set didn’t rely on technology to bring about transformation, but rather to accelerate it. They were extremely careful in choosing which technologies to adopt, in their attempts to accelerate progress, and avoid decline.
The Flywheel. This is one of the concepts that stood out most to me. Collins is basically saying that the good-to-great companies slowly but steadily built momentum as they became great. That momentum had a compound effect over time. Collins explains that none of the good-to-great companies experienced overnight success. It was much more gradual. He vividly explains, “sustainable transformations follow a predictable pattern of buildup and breakthrough. Like pushing on a giant, heavy flywheel, it takes a lot of effort to get the thing moving at all, but with persistent pushing in a consistent direction over a long period of time, the flywheel builds momentum, eventually hitting a point of breakthrough.” Collins further elaborates, explaining “when I look at the good-to-great transformations, the one word that keeps coming up is consistency.” I think this emphasis on consistency is really interesting, and I can see the benefits play out in businesses, and in many other areas of life.
One of Several Great Books
Overall, I think “Good to Great” is an excellent book. Collins is the first business analysis author to really grab my attention, and make me want to deeply explore what makes businesses and other organizations successful. I recently wrote reviews on “Great by Choice” and “How the Mighty Fall,” and I plan to review “Built to Last.” These books make me think about the world and my own life differently. They make me want to use what I’ve learned to strengthen my household, career, and investments. I highly recommend these books if what you’ve read here has sparked your curiosity.
Nice write up! My previous trusted advisor/trainer for GM had recommended that we read “Good To Great,” definitely have plans of adding it to my September reading list!
You will like it Brandon! I listened to the audio version first, which was super entertaining, because it was read by author Jim Collins, who is very passionate about his work. I bought the print version too, because I like having a reference I can mark up with a highlighter. I will say though, my favorite Jim Collins book is “Great by Choice”. But ALL the books I’ve read by him are very good.