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From Good to Great by Jim Collins

Good to Great by Jim Collins tried to understand and answer the question which most businesses today ask, which is, why do organizations that are in the same industry succeed while others fail?

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The concept of reading needs to be re-invented.  The art of reading is fast becoming a lost art.  We need to re-invent the culture of reading in our society.  We are what we read.  As we peruse through the pages of good books, the words that we are internalizing begins to influence us.  Words are potent.  As we read, our mind begins to undergo a metamorphosis.  We begin to think in line or out of line, under the influence of the author’s mind.  Hence, as we study, we become.  If we do not read, we do not become.  Reading fills our thoughts with new ideas.  The absence of reading makes our minds devoid of creative thought and innovation.  René Descartes’ famous statement states, “Cogito ergo sum,” which when translated means, “I think therefore I am.”  Today, in the spirit of re-inventing the art of reading, herewith assert, “Lego cogito ergo sum,” meaning, “I read therefore I am.”  Today on the Oaekpost Book Review Bookshelf, we will be reviewing the book, From Good to Great by Jim Collins.  As we read, may we go from being good to exceptional.

A primer for moving for moving higher than your status quo.

“We Are What We Read.” – Mark Crispin Miller

Most companies we celebrate for their outstanding contributions in revolutionizing how we live and do business today operated in years of obscurity before their exceptional results compelled the world to notice them.  These organizations like any other went through cash flow issues, burn out, failed ideas, high staff turnover and in some cases near bankruptcy until they got to the inevitable transition point that launched them into the limelight.

Jim Collins, the author of Good to Great with his 20-man team, generated over 6000 articles and 2000 pages of transcripts from 1,435 companies interviewed before they finally found the Eleven (11) Companies that became great to use as case studies for this book.  Jim and his team looked at companies that had same opportunities.  They found comparable companies in an industry with similar products and then began the in-depth research to understand why companies with similar characteristics, playing within the same industry do not all become exceptional.

The book tried to understand and answer the question which most businesses today ask, which is, why do organizations that are in the same industry succeed while others fail?  Also, what made these organizations succeed within the same environment when their competitors operating under the same political clime and business environment did not.  Collins and his team studied these exceptional organizations:  Abbott Laboratories, Fannie Mae, Gillette, Kimberly-Clark Corp., Kroger Co., Nucor Corp., Philip Morris, Pitney Bowes, Walgreens, Wells Fargo, Circuit City.  They discovered that these organizations became great not by being ‘in the right industry at the right time,’ but by identifying their unique strengths and working relentlessly to capitalize on them.

Looking in from outside, it would seem that the remarkable results these companies achieved happened overnight.  What most people do not understand about business is that there are no quickies that guarantee success.  Achieving corporate success in businesses many at times take a considerable amount of time.  It is usually a process that takes a lot of resources—financial and intellectual.  The leap from good to great only occurs after years of consistent effort, discipline and belief in the global vision of the organization.  It is what Collins calls ‘pushing against the flywheel.’

The companies that transitioned from good to great established a consistent system with clearly defined success indices.  These organizations also gave their employees the freedom and responsibility within the framework of that system to thrive.  The secret to their success was not hiring people that needed incentives to be motivated.  However, these exceptional organizations only hired people who did not need to be managed but were motivated self-starters.  They in turn then led the system, and not the people.

Jim Collins established that the first step in getting a ‘great’ company rolling forward towards success is by making sure that the right people are onboard.  Have a vision, and then employ only those whose vision aligns with that of the company to work towards the organizations’ vision.  Ensure that the people onboard are complementary and reflect the company’s values.  Then together, the company can achieve their global vision.  In the book, Jim Collins identifies the reason why it is a lot easier to motivate the right people.  The reason he gave was that the right people enjoy what they do.  Working with the right team makes work go on seamlessly with little or no hitches.  A complementary team makes work not feel like hard work. A team with great synergy makes working together a most enjoyable process.

Jim Collins believes that a company needs to pursue a culture where disciplined employees are consistently taking disciplined actions.  Discipline in organizations allows for order and structure to be the guiding mantra of the organization.  The concept of order and structure in a company removes any chance for a chaotic organizational atmosphere.  Beyond ensuring that employees are self-motivated, as a business owner, one needs to check that the employees are dedicated and passionate enough to be willing to work extra hard when required.

Collins writes that “Good is the enemy of great.”  That is one key reason why very few, so organizations become great today.  Great emphasis must be put in place to change the narrative and buttress the point that organizational metamorphosis cannot happen with the just “good” mindset.  Organizations will not be able to morph from good to great if today’s business owners do not correct this mindset.   CEO’s must begin to see the change as a process that shows its result over time.  The outstanding results seen with the eleven companies in the book is the outcome of a well-orchestrated organizational transformation process.

Key Lessons from the Book

First, good to great companies get the right people.  Collins and his team found that when the executives of good to great firms began their corporate transformations, “they first got the right people.”  We cannot overemphasize the importance of employing the right people from the beginning.  The right employees will be able to adapt to any changes in direction or strategy.  An organization will not have to motivate them because they share the desire to achieve greatness and therefore are already motivated.  Interestingly, regarding remuneration, the great companies pay no more than those that categorized as being merely good at what they do.  Also, when someone has something, they are genuinely passionate about, great pay then stops being a significant factor in motivating people.  As Collins puts it, “Great vision without great people is irrelevant.”

Second, good to great companies thrive on honesty.  Great companies distinguish themselves through their reliance on the facts or in today’s term, data, in their decision-making process.  The best companies always uphold the truth no matter who speaks it.  There are no gray areas with great companies—data speaks in the decision-making process and greatness happens as a result.  These organizations have an open-door policy culture of questioning and openness with no relevance to rank.

Third, good to great companies have a reason and purpose for being.  These great companies have a single idea or focus, which guides everything they do.  Individuals can apply this lesson to their lives as much to the organization.  Collins has a three-circle model to test for greatness.  This model is called The Hedgehog concept.  The first circle is the awareness that one can be the best at in the world.  Being the best at something involves a realistic appreciation of one’s abilities.  The second circle is understanding what drives a person or organization’s economic engine (i.e., where exactly does profit come from most abundantly).  The third circle is passion.  Placing a limit on oneself to do what one is passionate about may not bring about great wealth.  The hallmark and inception of a great enterprise will dwell on discovering something that one excels at beyond any other person and with the ample potential of making money while doing it. 

Fourth, good to great companies use technology as an accelerator.  Great organizations have a vision and do not lose sight of their key focus.  They use technology as a vehicular contrivance to assist their quest of reaching their goals at a quicker pace.  Technology has a way of speeding up the rate of change in organizations.  Hence, great organizations must structure themselves in a way that they quickly adapt to the change that technology brings.  Companies that go from good to great do not hop on technological bandwagons or chase after trends.  They determine and come to a consensus on what technology makes the most sense for them and then pioneer its application to maximize it to the fullest. 

Fifth, good to great companies adopt a Level 5 Leadership strategy.  Collins goes on to identify “Level 5 leadership” as a common characteristic of the great companies assessed in the study.  This type of leadership forms the top level of a 5-level hierarchy that ranges from merely competent supervision to strategic executive decision-making.  The personal ego and individual financial gain are not as important as the long-term benefit of the team and the company to authentic Level 5 leaders.

Sixth, good to great companies adopts a culture of discipline.  We should never confuse a culture of discipline with a strict authoritarian environment.  Jim Collins reference to the term discipline in describing the role it plays within a business is an organization in which an unrelenting inner sense of determination drives each manager and staff member.  In this type of organization, each employee functions as an entrepreneur, with a deeply rooted personal investment in both their work and the company’s success.

One action point Jim Collins suggested in the book is that individuals or organizations should “leap from great to enduring great.”  Companies that attain greatness do so by staying focused.  They focus on their products, services, are obsessed with their customers and their businesses.  These companies or even individuals aspire to higher levels of excellence.  They never rest their oars.  They never become lax and complacent.  They stay energized and are always passionate about their products and services as they forge onwards towards greatness and to greater greatness. 

In the final chapter of the book “Good to Great,” Collins establishes a link between this hundred-proof book and his previous work, “Built to Last;” which was a representation of the conclusions of a six-year inquiry into the factors that determined whether a fledgling organization or company would survive in the long term.  He contends that companies need a set of core values to achieve the kind of long-term success that could eventually lead to greatness. 

The reasons why companies should exist should rest on the foundations of a higher purpose than merely on the pedestal of just profit generation to transcend the category of merely good, to a grand status of distinction.  According to Collins, this purpose does not have to be specific even if the shared values that compel the company toward success are as open-ended as being the best at what they do and achieving excellence consistently.

(NB. The article above is just a short synopsis of the book, From Good to Great by Jim Collins.  This book will add value to the mind of those who want to transcend from just being ordinary to extraordinary.  Hopefully, this short book review motivates the reader to want to read the entire book.  If yes, grab a copy, read it, and get the full bulk of its message).

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Ogbonnaya Agom-Eze is an entrepreneur and the Founder, CEO, Editor-In-Chief of Oaekpost, LLC, a U.S.-based online media company and the parent organization of www.oaekpost.com. He is a multi-niche writer with a wide range of interests in various genres. Agom-Eze is based in the Greater Seattle Area, Washington, and can be reached at ogb@oaekpost.com.

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