Good to Great by Jim Collins

Review by Andrew Gray

Anyone who has visited K&H’s offices in the last few months may have noticed a large (10′ by 4′) painting on the wall of one of our meeting rooms. The painting shows a landscape on which there is a road. The road represents a time line covering the modern era at K&H, from about 1995, and goes through to the present and into the future. At various points on the road are different buses – each representing K&H at that particular point in time: a run-down, worn-out bus struggling uphill in 1995 and a super hi-tech multi-decker going into the future. The purpose of the mural is to provide a powerful, metaphorical focal point for the changes that K&H has been through and is still going through. The future bus represents the Vision that makes the discomfort of the present worth going through. Creating and communicating a Vision for the future are essential components of any effective business strategy.

The inspiration for the mural was partly the latest Harry Potter film (Prisoner of Azkaban) and but mainly the “First Who…. Then What” chapter of Jim Collins’ book, Good to Great.

Good to Great is the result of a 5-year research project by 21 people from about 1996 onwards which looked at 1,435 companies. The objective was to find out why some of those companies went from being merely good to being great – outperforming the competition by 4 to 6 times.

Crucially, however, they only looked at companies that had already been around for at least 15 years before making the leap, and that had sustained that greatness for at least 15 years afterwards.

The result was that only 11 companies met the criteria set. Those 11 companies showed some significant similarities in the causes of their greatness, and the book examines these detail. The characteristics that were found to be common were:

• Level 5 leadership – the people who led the company through the transition from good to great were not the stereotypical, larger-than-life charismatic bosses that you might expect. Instead they were quiet and humble but very determined and focused individuals
• First who …then what – Here’s where the bus comes in: getting the right people “on the bus” was done before formulating the business strategy
• Confront the brutal facts (yet never lose faith) - tough decisions have to be made and acted upon. Don’t compromise
• The hedgehog concept - focus on the one thing that you can be the best in the world at and which you are passionate about and can make you money
• Culture of discipline – If all your people are committed to your vision and consistent in their commitment, you don’t need hierarchy, bureaucracy or excessive controls
• Technology accelerators – Technology does not drive success, but the good to great company uses carefully selected technologies to facilitate it
• The flywheel and the doom loop – The good to great transition does not happen overnight, and no single act or event is decisive. Instead it is like trying to get a huge steel flywheel turning: it will hardly move at all to start with no matter how hard you push. But once it does start moving, it has massive momentum

Good to Great is one of the most powerful business books you will ever read. It is one of the few business books that is based on solid evidence and experience, no just ideas.