First Who . . . Then What Good to Great: chapter 3

Three Simple Truths

1. Beginning with "who" makes adapting to change easier

2. Problem of motivating people dissipates with the right people

3. The right direction is useless with the wrong people

Building the Future

Prepared for change by hiring talented people who could handle it

When the industry fell 59%, Wells Fargo outperformed the market by 3x

Failure of Bank of America's "weak generals, strong lieutenants" approach

The Main Points

Get the right people on and wrong people off before choosing a direction

  • About character traits and innate capabilities more than specific knowledge, background, or skills

The degree of rigor needed in people decisions

Ex: David Maxwell and $1 million a day

Who Not How

No pattern linking executive compensation to good-to-great process

Good-to-great executives received less total 10 years after the transition

Purpose of compensation: To get the right people on the bus and keep them

People are not your most important asset: The right people are

Rigorous, Not Ruthless

Deal with people up front and let them move on with their lives

Must first become rigorous about top management

Not a head-lopping tactic: Good-to-great companies used layoffs 5x less

How to Be Rigorous

1. When in doubt, don't hire - keep looking

  • Packard's Law: Revenues cannot grow consistently faster than your people

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

  • Not more churn, but better churn
  • Possibly the wrong seat on the bus

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

  • When selling off your problems, don't sell off your best people
  • Executives who argue and debate yet unify behind decisions

Great Company: Great Life

Personal cost - can you have both?

Yes - linked by "First Who"

Friends for life

Thank You


Created with images by kevin dooley - "Business."

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