Book Summary: Good To Great

Explore what goes into a company's transformation from mediocre to excellent. Based on hard evidence and volumes of data, the book author (Jim Collins) and his team uncover timeless principles on how the good-to-great companies like Abbott, Circuit City, Fannie Mae, Gillette, Kimberly-Clark, Kroger, Nucor, Philip Morris, Pitney Bowes, Walgreens, and Wells Fargo produced sustained great results and achieved enduring greatness, evolving into companies that were indeed 'Built to Last'.

The Collins team selected 2 sets of comparison companies:

a. Direct comparisons - Companies in the same industry with the same resources and opportunities as the good-to-great group but showed no leap in performance, which were: Upjohn, Silo, Great Western, Warner-Lambert, Scott Paper, A&P, Bethlehem Steel, RJ Reynolds, Addressograph, Eckerd,and Bank of America.

b. Unsustained comparisons - Companies that made a short-term shift from good to great but failed to maintain the trajectory, namely: Burroughs, Chrysler, Harris, Hasbro, Rubbermaid, and Teledyne

Wisdom In A Nutshell:

a. Ten out of eleven good-to-great company leaders or CEOs came from the inside. They were not outsiders hired in to 'save' the company. They were either people who workedmany years at the company or were members of the familythat owned the company.

b. Strategy per se did not separate the good to greatcompanies from the comparison groups.

c. Good-to-great companies focus on what Not to do and whatthey should stop doing.

d. Technology has nothing to do with the transformation fromgood to great. It may help accelerate it but is not thecause of it.

e. Mergers and acquisitions do not cause a transformationfrom good to great.

f. Good-to-great companies paid little attention to managingchange or motivating people. Under the right conditions,these problems naturally go away.

g. Good-to-great transformations did not need any new name,tagline, or launch program. The leap was in theperformance results, not a revolutionary process.

h. Greatness is not a function of circumstance; it is clearlya matter of conscious choice.

i. Every good-to-great company had "Level 5" leadership duringpivotal transition years, where Level 1 is a Highly CapableIndividual, Level 2 is a Contributing Team Member, Level 3is the Competent Manager, Level 4 is an Effective Leader,and Level 5 is the Executive who builds enduring greatnessthrough a paradoxical blend of personal humility andprofessional will.

j. Level 5 leaders display a compelling modesty, areself-effacing and understated. In contrast, two thirds ofthe comparison companies had leaders with gargantuanpersonal egos that contributed to the demise or continuedmediocrity of the company.

k. Level 5 leaders are fanatically driven, infected with anincurable need to produce sustained results. They areresolved to do whatever it takes to make the company great,no matter how big or hard the decisions.

l. One of the most damaging trends in recent history is thetendency (especially of boards of directors) to selectdazzling, celebrity leaders and to de-select potential Level5 leaders.

m. Potential Level 5 leaders exist all around us, we just haveto know what to look for.

n. The research team was not looking for Level 5 leadership,but the data was overwhelming and convincing. The Level 5discovery is an empirical, not ideological, finding.

o. Before answering the "what" questions of vision andstrategy, ask first "who" are the right people for the team.

p. Comparison companies used layoffs much more than thegood-to-great companies. Although rigorous, thegood-to-great companies were never ruthless and did notrely on layoffs or restructuring to improve performance.

q. Good-to-great management teams consist of people who debatevigorously in search of the best answers, yet who unifybehind decisions, regardless of parochial interests.

r. There is no link between executive compensation and theshift from good to great. The purpose of compensation isnot to 'motivate' the right behaviors from the wrong people,but to get and keep the right people in the first place.

s. The old adage "People are your most important asset" iswrong. People are not your most important asset. The rightpeople are.

t. Whether someone is the right person has more to do withcharacter and innate capabilities than specific knowledge,skills or experience.

u. The Hedgehog Concept is a concept that flows from the deepunderstanding about the intersection of the following threecircles:

1.What you can be best in the world at, realistically, and what you cannot be best in the world at

2.What drives your economic engine

3.What you are deeply passionate about

v. Discover your core values and purpose beyond simply makingmoney and combine this with the dynamic of preserve the corevalues - stimulate progress, as shown for example by Disney.They have evolved from making short animated films, tofeature length films, to theme parks, to cruises, but theircore values of providing happiness to young and old, and notsuccumbing to cynicism remains strong.

w. Enduring great companies don't exist merely to deliverreturns to shareholders. In a truly great company, profitsand cash flow are absolutely essential for life, but theyare not the very point of life.

"IF YOU'RE DOING SOMETHING YOU CARE DEEPLY ABOUT AND IF YOUBELIEVE IN IT, IT'S IMPOSSIBLE TO IMAGINE NOT TRYING TO MAKEIT GREAT."

By: Regine P. Azurin and Yvette Pantilla http://www.bizsum.com "A Lot Of Great Books....Too Little Time To Read" Free Book Summaries Of Latest Bestsellers and More!

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