Built to Last, the defining management study of the
nineties, showed how great companies triumph over time and how
long-term sustained performance can be engineered into the DNA of
an enterprise from the verybeginning.
But what about the company that is not born with great DNA? How
can good companies, mediocre companies, even bad companies achieve
For years, this question preyed on the mind of Jim Collins. Are
there companies that defy gravity and convert long-term mediocrity
or worse into long-term superiority? And if so, what are the
universal distinguishing characteristics that cause a company to go
from good to great?
Usingtough benchmarks, Collins and his research team identified a
set of elite companies that made the leap to great results and
sustained those results for at least fifteen years. How great?
After the leap, the good-to-great companies generated cumulative
stock returns that beat the general stock market by an average of
seven times in fifteen years, better than twice the results
delivered by a composite index of the world's greatest companies,
including Coca-Cola, Intel, General Electric, and Merck.
The research team contrasted the good-to-great companies
with a carefully selected set of comparison companies that failed
to make the leap from good to great. What was different? Why did
one set of companies become truly great performers while the other
set remained only good?
Over five years, the team analyzed the histories of all
twenty-eight companies in the study. After sifting through
mountains of data and thousands of pages of interviews, Collins and
his crew discovered the key determinants of greatness -- why some
companies make the leap and others don't.
The findings of the Good to Great study will surprise many readers
and shed light on virtually every area of management strategy and
practice. The findings include:
- Level 5 Leaders: The research team wasshocked
to discover the type of leadership required to achieve
- The Hedgehog Concept (Simplicity within the
Three Circles): To go from good to great requires transcending the
curse of competence.
- A Culture of Discipline: When you combine a
culture of discipline with an ethic of entrepreneurship, you get
the magical alchemy of great results. Technology Accelerators:
Good-to-great companies think differently about the role of
- The Flywheel and the Doom Loop: Those who
launch radical change programs and wrenching restructurings will
almost certainly fail to make the leap.
?Some of the key concepts discerned in the study,? comments Jim
Collins, "fly in the face of our modern business culture and will,
quite frankly, upset some people.?
Perhaps, but who can afford to ignore these findings?