I am back from Toronto and I am a changed man. I am taking time to write. I am getting exercise. I am sleeping more. And lastly, I am reading books! In the first book that I have read in about six weeks, I finally got around to reading Good to Great.
What is this book about?
Good to Great is a best-selling book based on years of meticulous research on some of America’s top companies. The research team wanted to identify why a company makes the leap from good to great and why others simply don’t. The selection process for the companies studied was as follows: companies that have had average or below average stock market returns over the course of at least 15 years, followed by at least 15 years of phenomenal growth with returns at least 3x more than the market. Looking at the entire Fortune 500, only 11 companies met this criteria, including familiar names such as Circuit city, Fannie Mae, Gillette, Kimberly-Clark, Philip Morris, Walgreens, and Wells Fargo. Each company was then paired with a comparison company in the same industry that didn’t exhibit the same good to great transformation. After a lot of comprehensive research, six key factors were identified that there prevalent in all 11 companies and were not prevalent in their competitors.
What does the book teach you?
To briefly summarize their six characteristics of good-to-great companies:
Level 5 Leadership – “Leaders who embody a paradoxical mix of personal humility and professional will. They are ambitious, to be sure, but ambitious first and foremost for the company, not themselves.”
First Who…Then What – “Beginning the transformation by first getting the right people on the bus (and the wrong people off) and then figuring out where to drive it.”
Confront the Brutal Facts – “Finding a path to greatness by confronting the brutal facts of their current reality (yet never loosing faith).”
The Hedgehog Concept – “To go from good to great requires a deep understanding of three intersecting circles translated into a simple concept: What are you deeply passionate about, What you can be the best in the world at, and what drives your economic engine.”
Culture of Discipline – “Sustained great results depend upon building a culture full of self-disciplined people who take disciplined action, fanatically consistent with the three circles.”
Technology Accelerators – “Good to great companies think different about technology and technological change than mediocre ones.”
Why should you read this book?
I enjoyed this book because it was based on thorough research and analysis. It makes it much easier to conceptualize the ideas in this book because there are direct examples from each of the 11 good to great companies. While this book examines large companies, there is definitely a ton of knowledge that is applicable to startups and smaller organizations. Lastly, at the end of the day, I believe that Good to Great comes down to culture, and there are many ideas and examples in this book that will help you emulate the same culture in your own organization.