The co-author of the bestselling “Built to Last” now presents a blueprint for transforming good companies into great ones. Charts & graphs throughout.
The Challenge:
“Built to Last,” the defining management study of the nineties, showed how
great companies triumph over time and how long-term sustained performance can be
engineered into the DNA of an enterprise from the verybeginning.
But what about the company that is not born with great DNA? How can good companies, mediocre companies, even bad companies achieve enduring greatness?
The Study:
For years, this question preyed on the mind of Jim Collins. Are there companies
that defy gravity and convert long-term mediocrity or worse into long-term
superiority? And if so, what are the universal distinguishing characteristics
that cause a company to go from good to great?
The Standards:
Using tough benchmarks, Collins and his research team identified a set of elite
companies that made the leap to great results and sustained those results for at
least fifteen years. How great? After the leap, the good-to-great companies
generated cumulative stock returns that beat the general stock market by an
average of seven times in fifteen years, better than twice the results delivered
by a composite index of the world's greatest companies, including Coca-Cola,
Intel, General Electric, and Merck.
The Comparisons:
The research team contrasted the good-to-great companies with a carefully
selected set of comparison companies that failed to make the leap from good to
great. What was different? Why did one set of companies become truly great
performers while the other set remained only good?
Over five years, the team analyzed the histories of all twenty-eight companies in the study. After sifting through mountains of data and thousands of pages of interviews, Collins and hiscrew discovered the key determinants of greatness – why some companies make the leap and others don't.
The Findings:
The findings of the Good to Great study will surprise many readers and shed
light on virtually every area of management strategy and practice. The findings
include:
Level 5 Leaders: The research team was shocked to discover the type of
leadership required to achieve greatness.
The Hedgehog Concept (Simplicity within the Three Circles): To go from good to
great requires transcending the curse of competence.
A Culture of Discipline: When you combine a culture of discipline with an ethic
of entrepreneurship, you get the magical alchemy of great results. Technology
Accelerators: Good-to-great companies think differently about the role of
technology.
The Flywheel and the Doom Loop: Those who launch radical change programs and
wrenching restructurings will almost certainly fail to make the leap.
“ Some of the key concepts discerned in the study, ” comments Jim Collins, "fly in the face of our modern business culture and will, quite frankly, upset some people.”
Perhaps, but who can afford to ignore these findings?