Summary of Good to Great Book (By Jim Collins)

Disclaimer: This summary is only for my personal review based on my understanding and perception of the book Good to Great written by Jim Collins.

This book focuses on 11 companies from Fortune 100 that have been selected/short listed based on certain parameters as criteria and then analyzed, compared these 11 companies that moved from Good to great with 17 comparable companies that have same opportunities at the same time and didn’t achieve greatness.

During this research analysis and comparisons, the research team has identified some patterns, processes and philosophies on how the management of those companies have achieved greatness. And which has been conceptualized as a framework by the author and research team of this book. This framework can be leveraged by any start up or existing organization that are focusing on achieving greatness.

Criteria Used for Selecting Good to great companies:  Three principal reasons

•                  Beat the market return over 15 years by 3 times or more
•                  Sustain the returns for 15years after the break through transformation
•                  Sustain remarkable results preceded by sustained period of average or worse returns

The framework has been built on 2 major components build up and break through and this has been achieved by management of the good to great companies by following 3 stages

•                  Disciplined people
•                  Disciplined thought and
•                  Disciplined action

And each stage has 2 concepts that have been religiously followed by all the good to great companies they are:

         i.            Disciplined people

a.       Level5 Leadership

b.       First who…then what

       ii.            Disciplined thought

a.       Confront the brutal facts

b.       Hedgehog concept

     iii.            Disciplined action

a.       Culture of discipline

b.       Technology accelerators

Level 5 leadership: The leaders who constantly display workmanlike diligence, who attribute success to factors other than themselves, who are passionate in producing excellent results and paradoxical mix of personal humility and personal will. They also focus on setting up for their successors for even greater success.

First who and then what: The transformation to greatness always starts with right people in the right positions and level5 leaders always make sure that they are right people on the bus and wrong people off the bus. Change is constant in this world, so it is important to have right people in the team who embrace change, people who start by looking at the vision may drop off the bus when the vision changes, but team that trusts each other will embrace the change of vision and move forward to achieve impressive results based on the changing market conditions. So, it is important to have people who trust the team rather than just vision.

Confront brutal facts: There is huge amount of data available in the world and it is important to have factual information and ability to handle brutal facts that confront us every day. All good to great companies have embraced brutal facts of their current reality honestly compared to comparison companies that haven’t achieved greatness. To achieve this, it is important to create a culture in the organization where truth to be heard by leading with questions rather than answers, engaging in debates instead of coercion and build mechanism that turn information into action items.

Hedgehog concept: This is important concept that has been religiously followed by good to great companies no matter what the market conditions or opposition. This concept is simple, crystalline concept that follows from understanding of intersection of following 3 circles

         i.            What you can best on the world at

       ii.            What drives the economic engine

     iii.            What you are most passionate about

Culture of discipline: When we have disciplined people, they have extreme diligence and great intensity that creates culture of discipline which avoids bureaucracy in the organization (Bureaucratic cultures arise in company to compensate incompetence and lack of discipline). The most important form of discipline for sustained results is fanatical adherence to hedgehog concept and willingness to shun opportunities that fall outside of 3 circles.

Technology accelerators: It is always important to remember technology is only accelerator but never a creator of momentum. All the good to great companies avoid technology fads and bandwagons but they always become pioneers in the application of selected technologies. It is always important to make sure that technology need directly fits into the hedgehog concept if not it is always advisable to avoid.

It is often important to analyze if the transformation is falling into the fly wheel or the doom loop. The following factors can be looked upon to verify if the organization falling to doom loop or is in fly wheel. Good to great transformations often look dramatic, revolutionary from the outside world but they are organic and cumulative process for the people inside. Sustainable transformation follows a predictable pattern of build up and breakthrough. On the other hand, comparison companies skip buildup and jump to breakthrough by creating huge marketing campaigns, kickoff with fanfare and hoopla only to see programs failing to produce sustained results.

Conclusion: Being right is not impossible if we have all the pieces in place. If you have level 5 leaders who get right people on the bus, if you confront brutal facts of reality, if you create a climate where truth is heard, if you have a council and work within 3 circles of hedgehog concept, if you act from understanding, not bravado, if you do all these things then you are likely to be right on the big decisions.

Favorite quote from the book: It is impossible to have great life unless it is meaningful life. And it is very difficult to have a meaningful life without meaningful work.