Reviewed by Alex Guzman
Collins introduces his findings within a “flywheel” concept. He uses this model to describe the process from “buildup” to “breakthrough.” This process is a product of three stages, each composed of two concepts. The first stage, “disciplined people,” consists of “Level 5 Leadership” and “First Who…Then What.” In the “disciplined thought” stage the concepts are “Confront the Brutal Facts” and “Hedgehog Concept.” And “disciplined actions” is comprised of “Culture of Disciple” and “Technology Accelerators.” As each concept is a key aspect of the analysis process, Collins devotes a chapter to each in which he explains the meaning and results associated with each concept.
Level 5 Leadership is arranged in a hierarchy from Highly Capable Individual to Contributing Team Member to Competent Manager to Effective Leader to Level 5 Executive. Collins asserts that it is not necessary to move sequentially up the hierarchy, but rather assumes that Level 5 leaders exemplify all hierarchal characteristics. According to the research results, Collins concludes that Level 5 leaders are characterized as modest, self-effacing, understanding, diligent, ambitious and humble. These leaders “look out the window” to credit their success, but “look in the mirror” to take personal responsibility for failure.
To explain the First Who…Then What concept, Collins uses the analogy of a bus. He maintains that it is first necessary to have the right people on the bus before deciding where to drive it. He distinguishes between this model and the “genius with a thousand helpers” model, utilized by most of the good companies. One other key point that Collins establishes is that great companies put the best people on the greatest opportunities as opposed to the greatest problems.
In terms of Confronting the Brutal Facts, the research shows that great companies assess their situation accurately, even if that means facing a brutal truth. Kroger conducted a great deal of research in the 1960s investigating the success of the “superstore concept.” Executives came to the conclusion that “old-model grocery stores,” which included nearly all Kroger stores at the time, were becoming obsolete. Therefore, Kroger faced the facts and began a rehaul of its stores. Through such assessment, great companies are then equipped to make better decisions in the long run.
The Hedgehog Concept is presented as a three-circle diagram composed to “What are you deeply passionate about,” “What you can be the best in the world at” and “What drives your economic engine.” The Hedgehog Concept is embodied by great companies that understand what they are best at, not what they want to be best at. For example, Wells Fargo has succeeded in running a bank like a business because that is what the company best at. This success came only after discontinuing their work in global banking, which they could not execute better than competitor Citicorp. Collins found that great companies seem to know “one great thing” and abide by that principle in every facet of business. The author also notes in this section that a great industry is not a crucial determinant of a great company.
A Culture of Discipline relates back to the three stages, in that great companies must find people who employ disciplined thought that can translate that thought into disciplined action. Collins found that the more disciplined a company, that is, the more able it is to stay within the three circles of the Hedgehog Concept, the more it will sustain growth. The author also indicates that great companies can overlook a “once in a lifetime opportunity” if it does not fit within the circles.
The concept of Technology Accelerators affirms that great companies have a different view of technology than good companies. Collins’ researched shows that technology alone is not an indicator of either success or failure, but emphasizes that great companies use the right technology to their advantage and are not led astray by technological fads.
While Good to Great focuses on a variety of corporate attributes, Collins seems to minimize the role of leadership and management. He qualifies this disparity in accounting for today’s mentality of “credit the leader” or “blame the leader.” However, the fact of the matter is that leadership undermines each concept that Collins presents. Without adequate management, the initiatives necessary to transform a good company into a great company could not be put into action. It is the job of management to exercise the principles that Collins communicates.
In terms of management, Collins analysis of great companies seems to lean toward the collaborative management style of Mary Parker Follett and her concept of authority. He contends that it is necessary for employees to disagree such that all perspectives can be presented, but that ultimately there must be a consensus. Collins also introduces an idea of management that is more of a non-management concept, whereby the company need only hire self-disciplined people, give them freedom within the system and then manage the system as opposed to the employees.
Collins emphasizes that there is no system or type of system that works for all organizations, a recurring theme of management. Rather, he states that successful strategy is a product of concurrence with the Hedgehog Concept and the translation of the strategy into one simple notion. This focus on individual circumstances and management of the system does not explicitly coincide with any one management system.
The material in this book is presented in an interesting and easy-to-understand approach. Perhaps one of the most compelling aspects of Good to Great is the fact that all of Collins’ points are substantiated by thorough research. The fact that no claim is made without study and analysis makes this book even more persuasive in its claims.
Good to Great, although insightful and well-written, is not necessarily a beneficial read for public relations personnel. While management and leadership are addressed, the themes of the book are more pertinent for executives and entrepreneurs. However, the idea of management of the system versus management of the individual is an interesting concept that could be applied in a new management effort, but it is not practical in public relations, as the field is inherently group-oriented.
