Good to Great Why some companies make the leap...and Others don't

Chapter 1: Good is the Enemy of Great

  • The research study: Companies were identified that made the leap from good results to great results and sustained those results for at least 15 years
  • These companies were compared to a group of comparison companies that failed to make the leap to discover the essential and distinguishing factors at work
  • The Framework of Concepts of Transforming a Good Company into a Great Company

Chapter 2: Level 5 Leadership

  • Level 5 Leaders have an ambition for institution, not themselves
  • Set up successors for success
  • Largely hired from inside the company
  • Credit good circumstances on luck
  • Plow horse vs. Show horse
  • Often overlooked for leadership positions

Chapter 3: First Who, Then What

  • The analogy of the bus
  • Not "A genius with a thousand helpers"
  • It's who you pay, not how you pay them
  • Rigorous, not ruthless
  • How to be rigorous
  • First who, great companies, and a great life

Chapter 4: Confront the Brutal Facts (But Never Lose Faith)

  • Facts are better than dreams: Good to Great companies infuse their entire process with the brutal facts of reality
  • 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
  • Unwavering faith among the brutal facts: Good to Great companies face competition and leave themselves stronger and more resilient rather than weak and more dispirited.
  • The Stockade Paradox: It’s not the presence or absence of difficulty, but how you deal with the inevitable difficulties in life.

Chapter 5: The Hedgehog Concept (Simplicity Within the Three Circles)

  • Hedgehog Concept (The Three Circles): 1. What can you be the best in the world at? 2. What drives your economic engine? 3. What are you deeply passionate about?
  • Implementing the Hedgehog Concept using a Council
  • The way to make the transition from Good to Great is often not doing many things well, but instead, doing one thing better than anyone else in the world.

Chapter 6: A Culture of Discipline

  • The foundation of a disciplined culture is set by self-disciplined people that engage in disciplined thought and take disciplined action.
  • Requires people who adhere to a consistent system.
  • Gives people freedom and responsibility within a framework of that system.
  • Collins describes the actions of world-class athlete and six-time Ironman Triathlon winner Dave Scott as an example of a highly self-disciplined individual.
  • A bureaucratic culture rises to compensate for incompetence and lack of discipline.
  • Hedgehog concept: simplify a complex world into a single organizing idea, concept that unifies and guides everything.

Chapter 7: Technology Accelerators

  • Good-to-Great companies connect technology to its Hedgehog concept (Ex. Walgreens using intercom)
  • The pioneering application of technology is more important than the technology itself (Ex. Kroger)
  • Technology helps accelerate momentum in a company after the transition phase had already begun
  • Most good-to-great executives did not mention technology as one of its top factors in the transition process
  • Technology is not a primary part of the transition, but a secondary part

Chapter 8: The Flywheel and the Doom Loop

  • Business decisions tend to accumulate incrementally in either an advantageous or a disadvantageous manner.
  • Failure is often not sudden, but something that occurs over numerous years
  • The Flywheel Effect: By making decisions and taking actions that reinforce and affirm the company’s "hedgehog" competencies, executives initiate positive momentum
  • The Doom Loop: Consists of reactive decision-making, following short-lived trends, frequent changes in leadership and personnel, loss of morale, and disappointing results.

Chapter 9: From Good to Great to Built to Last

  • Collins's previous book Built to Last: represented the findings of a six-year study into the factors that determined whether a new company would survive in the long-term
  • Companies need a set of core values in order to achieve the kind of long-term, sustainable success that may lead to greatness.
  • Companies need to exist for a higher purpose than mere profit generation in order to transcend the category of merely good.

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