- Good is the enemy of the great.
- Greatness is not largely a matter of circumstance, but of conscience choice and discipline.
- How do great companies fall from great, to mediocre, to irrelevant, to gone?
- If great companies can fall, than anyone can fall; no one and nothing is immune.
- The great fall through a series of stages; you can be sick on the inside but still look strong on the outside.
- The beginning of a fall is harder to detect early but easier to remedy. It is easier to detect later but harder to remedy.
- Here are the series of stages of decline for an organization. Each stage is self-inflicted - not what is done to you, but what you do to yourself:
- Stage 1: Hubris born of success
- We neglect our primary flywheel and primary calling, fail to renew it. We believe that because our intentions are good and noble, that our decisions are necessarily good. However, bad decisions with good intentions are still bad decisions.
- The remedy: good leaders who know that it's not about them, and who never give up.
- These leaders are level 5 leaders - people who are not simply charismatic, but humble. Not a soft humility, but a humility born of a burning passion to do whatever it takes to support and live by the values.
- Without the level 5 leaders, we are dangerously exposed to hubris.
- Stage 2: Undisciplined pursuit of more
- The mighty don't fall because they are unwilling to change; they fall because they reach too far. They try to expand too much. They try to deliver without excellence. They give themselves permission to grow without having the right people in the right areas.
- You have to regulate growth by sticking to having fantastic people in all of the key seats. If not, you have you resist growth until you have them there. Don't figure out where to drive until you've got the right people in the right spot.
- Stage 3: Denial of risk and peril
- You are getting negative feedback, but either choose to ignore it or underestimate it.
- You must never confuse faith and facts. You must embrace both, but not confuse them. You should have faith, but also be willing to confront the most brutal facts.
- Sometimes unanchored optimism masquerades as faith.
- Stage 4: Grasping for salvation (where the fall actually begins and is felt/visible)
- When you are confronted with the reality of a decline, you look for a silver bullet.
- 90% of the great companies got their CEO from within. 2/3 of the comparison companies got them from without.
- Greatness is never a singular event; it is a cumulative process. You have disciplined people engaging in disciplined thought taking disciplined action making decisions that are consistent with your values... turn upon turn, like a flywheel.
- It is possible to get into the later stages of stage 4, and come back.
- Stage 5: Capitulation to irrelevance or death
- At this point, you've squandered all of your various types of capital, and have run out of options.
- Because they had a reason to endure the struggle - beyond success, money, etc.
- They have answered the question: "What would be lost if we disappeared?"
- Their purpose is rooted in their core values, not just in their business models and strategies. Their power is derived from their values. They separate their values from how they do things.
- They recognize that the signature of mediocrity isn't an unwillingness to change; it is inconsistency. Their leaders embrace the genius of the "and". They entertain two seemingly competing ideas and hold them in healthy in tension. They stay true to their values but are willing to change their practices.
Specific "to-do's":
- Do your diagnostics (www.jimcollins.com). Self-assess and confront the brutal facts.
- Count your blessings - literally - in a spreadsheet. When we begin to account for all of the good things that have happened to us that we did not cause, it is humbling.
- What is your questions to statements ratio, and can you double it in the next year (1:1 to 2:1)? Great leaders don't know all of the answers; they ask the right questions. Invest more in being interested than interesting.
- Answer the question: "How many key seats do you have on your bus, who is in those seats currently/how many are empty, and what is your plan to fill those seats?"
- Do your teams on the way up/on the way down diagnostic.
- With your right team assembled, create an inventory of the brutal facts.
- A culture of disciplined people begins with what we have the discipline not to start doing, but to stop doing.
- Define results, and show clicks on the flywheel. How can you demonstrate what they are?
- Double your reach to young people by changing your practices without changing your core values.
- Set a BHAG (Big Hairy Audacious Goal) to remind you of the idea that your work is never done.
It is one thing to suffer a defeat; it is another to give up on the values for which you've struggled.
Jim Collins is great.
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