Good to GreatWhy Some Companies Make the Leap ... And Others Don’t by Jim Collins

Testing the Assumptions

Assumptions

That good is the enemy of great

LEVEL 5 LEADERSHIP:

Level 5 Leaders

LEVEL 5 LEADERSHIP

“Greatness is not a function of circumstance. Greatness, it turns out, is largely a matter of conscious choice.” p. 11

In your heart of hearts, are you satisfied with good – or for the sake of Extension, are you determined to become a Level 5 leader?

LEVEL 5 LEADERSHIP

They never aspired to be put on a pedestal or become unreachable icons. They were seemingly ordinary people quietly producing extra-ordinary results. p. 28

It is equally about ferocious resolve –infected with an incurable need to produce results. Humble and fearless…were incredibly ambitious. P.30

LEVEL 5 LEADERSHIP

Can you evolve, or continue to evolve, into a Level 5 leader? Under the right circumstances – self-reflection, conscious personal development, a mentor, a great teacher, a significant life experience, a Level 5 boss … p.37

What else would you add? What specifically needs to be on your list?

First Who, Then What

First Who, Then What

“…if you have the wrong people, it doesn‟t matter whether you discover the right direction; youstill won‟t have a great company. Great vision without great people is irrelevant.” P. 42

First Who, Then What

The right people don‟t need to be tightly managed or fired up.P.42

First Who, Then What

“…the „who‟ questions come before the „what‟ questions – before vision, before strategy, before tactics, before organizational structure, before technology.” P. 45

First Who, Then What

In a good to great transformation, people are not your most important asset. The right people are. P.51

First Who, Then What

The only way to deliver to the people who are achieving is to not burden them with the people who are not achieving. P.53

First Who, Then What

Practical principles:

1. When in doubt don’t hire, keep looking.

2. When you know you need to make a people change, act.

3. Put your best people on your biggest opportunities, not on your biggest problems.

First Who, Then What

What does this principle say to us?

How does this principle relate to Extension?

How might you tell if someone is the right person on the bus?

Confront the Brutal Facts (Yet never lose faith)

Confront the Brutal Facts (Yet never lose faith)

“You absolutely cannot make a series of good decisions without first confronting the brutal facts.” P. 70

Confront the Brutal Facts (Yet never lose faith)

“Yes, leadership is about vision. But leadership is equally about creating a climate where the truth is heard and the brutal facts confronted. There‟s a huge difference between the opportunity to „have your say‟ and the opportunity to be heard.” P.74

Confront the Brutal Facts (Yet never lose faith)

Creating a climate where truth is heard:

1. Lead with questions, not answers.

2. Engage in dialogue and debate, not coercion.

3. Conduct autopsies, without blame.

4. Build “red flag” mechanisms.

Remember The Stockdale Paradox

AND at the same time confront the most brutal facts of your current reality, whatever they might be.

Retain faith that you will prevail in the end, regardless of the difficulties.

Confront the Brutal Facts (Yet never lose faith)

“There is a sense of exhilaration that comes in facing head-on the hard truths and saying, „We will never give up. We will never capitulate. It might take a long time, but we will find a way to prevail.’” P.81

Confront the Brutal Facts (Yet never lose faith)

What are some of the brutal facts that we must face?

Using The Stockdale Paradox phrase a statement about one of these brutal facts?

How can we develop revenue streams?

How will positions be identified for reallocation?

Who are advocates and enemies for Extension? ?

The Hedgehog Concept

The Hedgehog Concept

It is simple

Know the “one big thing” and stick to it

It is an understanding, not a strategy

Getting a Hedgehog Concept is an iterative process

It took an average of four years for the G2G companies to get a Hedgehog Concept

The Hedgehog Concept

“Precisely, the Hedgehog concept is a simple, crystalline concept that flows from deep understanding about the intersection of the three circles.” P.95

What are your three circles?

What are you the best in the world at?

What drives your economic engine?

What are you deeply passionate about?

The Hedgehog Concept

A Hedge Hog concept is not a goal to be the best, a strategy to be the best, an intention to be the best, a plan to be the best. It is an understanding of what you can be the best at. P. 98

The Hedgehog Concept

“The only way to remain great is to keep applying the fundamental principles that made you great.” P.108

The Hedgehog Concept

“We should only do those things that we can get passionate about.” P.109

The Hedgehog Concept

“Know „one big thing‟ and stick to it.” P. 119

The Hedgehog Concept

Can each sub-unit and each person have a hedgehog concept?

The Hedgehog Concept

How is the Hedgehog Concept different for Extension?

A Culture of Discipline

“The purpose of bureaucracy is to compensate for incompetence and lack of discipline.” P.121

A Culture of Discipline

“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 wrong people on the bus, which increases the need for more bureaucracy to compensate for incompetence and lack of discipline, which then further drives the right people away, and so forth.” P. 121

“Avoid bureaucracy and hierarchy and instead create a culture of discipline.” P. 121

A Culture of Discipline

“Set your objectives for the year, you record them in concrete. You can change your plans through the year, but you never change what you measure yourself against.” P.122

A Culture of Discipline

“You focus on what you‟ve accomplished relative to exactly what you said you were going to accomplish – no matter how tough the measure.” P.122

A Culture of Discipline

“The point is to first get self-disciplined people who engage in very rigorous thinking, who then take disciplined action within the framework of a consistent system designed around the Hedgehog Concept.” P. 126

A Culture of Discipline

Should we have a “stop” doing list?

What should be on the list?

Technology Accelerators

Is technology the answer?

THE FLYWHEEL AND THE DOOM LOOP

The Doom Loop

The Flywheel Effect

“Revolution means turning the wheel” –Igor Stravinsky

THE FLYWHEEL AND THE DOOM LOOP

“Step by step, action by action, decision by decision, turn by turn of the flywheel – that adds up to sustained and spectacular results.” p.165

THE FLYWHEEL AND THE DOOM LOOP

“There will be build up and break through.” P.165

THE FLYWHEEL AND THE DOOM LOOP

“Tremendous power exists in the fact of continued improvement and the delivery of results. Point to tangible accomplishments … people see and feel the buildup of momentum, they will line up with enthusiasm.” P.174

Building Vision

Do we know what is core and what is not?

What is our vision?

Do we have a good BHAG?

What should be some of our base camps?

Going from Good to Great

Get involved in something you care so much about that you want to make it the best that it can be!

Great life = meaningful life = meaningful work

References

Collins, J. (2001). Good to great. HarperCollins Publishing: New York

Collins, J. (2005) Good to great and the social sectors. HarperCollins Publishing: New York

JimCollins.com (accessed April 17, 2006)