Scan barcode
A review by sarahanne8382
Good to Great: Why Some Companies Make the Leap...and Others Don't by Jim Collins
4.0
Jim Collins was already well-known for his research with Jerry Poras on Built to Last, which looked at common traits of perennially great companies, but he became even more so with it's follow-up. Good to Great: Why Some Companies Make the Leap … and Others Don’t answered the biggest question that resulted from Built to Last by studying average companies that eventually became over-achievers like those in Built to Last, and determine the keys to their transition to greatness. Although Collins' work is focused on the business world, the results of his study are surprisingly applicable to other areas, including non-profit organizations such as libraries. To accentuate this wide applicability, Collins followed up Good to Great with the short companion piece, Good to Great and the Social Sectors, applying the model to organizations such as police departments, churches, and schools. This rather wide range of applicability can be both a blessing and a curse for this study of what makes companies great.
After years of exhaustive research, Collins' study was able to decipher a clear pattern of change identical in each of the good-to-great companies. The companies, as varied as Fannie Mae, Phillip Morris, Kimberly Clark, and Kroger, showed a history of at least ten years of average performance, followed by a clear transition point, after which the company outperformed the market by an average of at least three times over 15 years.
For every good to great company, the study also followed a comparison company in the same industry that performed similarly to the good to great company up to the transition point, after which the good to great company began its sharp upturn, while the comparison company remained stagnant. Six unsustained comparisons were also found in companies that began a good-to-great transition only to backslide back to average. When the comparisons and unsustained comparisons fail to follow Good to Great principles, Collins explains how the company's actions failed to follow the principles uncovered in the study.
What initially surprises me about Good to Great is how it immediately disregards the blind pursuit of profit as the only worthwhile goal of an excellent business. Instead, the good to great companies were truly focused on improving their company not specifically for the sake of making money, but instead to make themselves better at their core business. This instantly made me see how the book could be beneficial to libraries, which aren’t interested in making money, but do want to provide their patrons with the best service possible. Collins even acknowledges the wide applicability of Good to Great in Good to Great and the Social Sectors when he points out that the “critical distinction is not between business and social, but between great and good” (2).
While Good to Great and the Social Sectors makes the connection between Good to Great and non-profit organizations more explicit, the findings of Good to Great really are easily adaptable to social organization. While market performance is the metric for measuring success, that is the most strictly business oriented aspect of the book, and was not actually the strongest driving factor for good-to-great companies. Good-to-great companies instead discovered their own metric by which to measure success, closely tied to the unique role they identify for themselves to fill. Rather than focusing on the usual profit per store figure, Walgreens realized that they could be more successful if they measured success by profit per customer visit, which was more in line with their plan for expensive, but convenient store locations (Good to Great 104-8). While Walgreens still uses some measure of profit to quantify their success, it leaves the door open for non-profit organization to develop their own methods of measuring success.
While it’s nice that Good to Great can be so widely applicable, that may also be the book’s biggest fault. In order to make sense in a wide range of organizations, the principles of Good to Great have to be highly adaptive, making Collins’ numerous examples so varied that they sometimes seem rather convenient. When Kimberly Clarke made the gutsy decision to sell its numerous paper mills and devote itself solely to the risky consumer products industry or when Abbott decided move its focus from the potentially lucrative pharmaceutical industry to making affordable healthcare products, Collins explains how each of the Good to Great concepts contributed to the decision to make these shocking, but successful decisions.
However, when the comparison companies make equally drastic changes, they clearly are not operating within the Good to Great framework because their companies didn’t succeed. To be fair, Collins does explain which parts of each company’s plan works and which doesn’t, but it almost seems too neat and tidy that everything a company does right is because of Good to Great while everything wrong is not part of that framework.
One solution to this problem seems to be the concept of the flywheel (“The Fly Wheel and the Doom Loop”). While a company may implement some of the Good to Great concepts, if they don’t continually implement them, they will not achieve the stellar results. Just as one push after the other on a flywheel slowly builds up momentum until the wheel is spinning smoothly when a company begins implementing Good to Great principles, the same can happen when companies make bad decisions, propelling companies downwards rather than upwards.
While I am a little cynical about how clear-cut Collins’ results were, I generally agree with the Good to Great concepts. One point that I found particularly interesting was the chapter “Technology Accelerators,” which addressed our recent obsession on technology as a requirement of a successful business. The comparison companies blindly followed every new technological fad with no real sense of direction. On the other hand, the good-to-great companies were often pioneers in specific applications of technology directly related to their central purpose. The lesson: "Mediocrity results first and foremost from management failure, not technological failure" (Good to Great, 156). If libraries, who often pride themselves on bringing technology to their patrons, can focus the role technology will play for them, they may be able to use their technology funds more efficiently.
The Hedgehog Concept has many applications for libraries. Good to Great explains the Hedgehog Concept as the intersection of the three questions: 1) What is your passion (in other words, what gets you excited)? 2) What can you be best in the world at (in other words, what are you uniquely skilled to do)? 3) What drives your economic engine (in other words, what will make you money) (Good to Great 94-110)? In Good to Great and the Social Sectors Collins modifies the third question slightly by asking “What drives your resource engine?” in other words, how do you ensure you receive the resources you need to continue doing what you’re doing (Social Sectors 18).
While libraries would love to be the one stop information source for everyone, realistically trying to fulfill that mission leaves everyone shortchanged. Assuming librarians have a passion for providing public access to information, that leaves libraries to figure out what role they’re uniquely situated to fulfill in their communities and how fulfilling that role can ensure they will continue to be funded. For example, a branch library in an immigrant neighborhood may realize that there’s a huge gap in ESL training. By helping their patrons learn English, they will be better able to participate in the political process and advocate continued library funding.
Once libraries have their Hedgehog Concepts in place, they can begin to ensure a culture of discipline, part of which involves making a “stop doing” list for all the activities staff devote time to that aren’t a part of your Hedgehog Concept. This is where you really begin to see how well crafted your Hedgehog Concept is. If you were too narrow, then your library can’t justify spending time on legitimate patron concerns, but if you’re too broad, staff are stretched too thin trying to be everything to everyone. Collins’ team found however, that if companies had already followed through on the earlier steps of the good-to-great transition (“Level 5 Leadership,” “First Who … Then What,” and “Confront the Brutal Facts”), then crafting an accurate Hedgehog Concept wasn’t a challenge (Good to Great 139-41). Thinking of the constant struggle in some public libraries to put on programs that will be well attended by the community, I wonder if the discipline of creating a Hedgehog Concept and then sticking rigidly to a “stop doing” list would improve their situation.
Good to Great: Why Some Businesses Make the Leap … and Others Don’t by Jim Collins strikes me as a generally helpful book for library managers. While the room for adaptation makes it easily applicable to library situations, it also put a lot of the work of interpretation squarely on manager’s to figure out exactly what decisions would fit the principles in the book. Still, Collins numerous real world examples provide a range of successful applications that have taken companies from good to great.
Works Cited
Collins, Jim. Good to Great: Why Some Companies Make the Leap ... and Others Don't. 2001. New York: Harper Collins.
Collins, Jim. Good to Great and the Social Sectors: A Monograph to Accompany Good to Great. 2005. New York: Harper Collins.
I read this book for a library management class, but I really ended up enjoying it. The points Collins makes are very useful, but it's not the end-all -be-all of management books
After years of exhaustive research, Collins' study was able to decipher a clear pattern of change identical in each of the good-to-great companies. The companies, as varied as Fannie Mae, Phillip Morris, Kimberly Clark, and Kroger, showed a history of at least ten years of average performance, followed by a clear transition point, after which the company outperformed the market by an average of at least three times over 15 years.
For every good to great company, the study also followed a comparison company in the same industry that performed similarly to the good to great company up to the transition point, after which the good to great company began its sharp upturn, while the comparison company remained stagnant. Six unsustained comparisons were also found in companies that began a good-to-great transition only to backslide back to average. When the comparisons and unsustained comparisons fail to follow Good to Great principles, Collins explains how the company's actions failed to follow the principles uncovered in the study.
What initially surprises me about Good to Great is how it immediately disregards the blind pursuit of profit as the only worthwhile goal of an excellent business. Instead, the good to great companies were truly focused on improving their company not specifically for the sake of making money, but instead to make themselves better at their core business. This instantly made me see how the book could be beneficial to libraries, which aren’t interested in making money, but do want to provide their patrons with the best service possible. Collins even acknowledges the wide applicability of Good to Great in Good to Great and the Social Sectors when he points out that the “critical distinction is not between business and social, but between great and good” (2).
While Good to Great and the Social Sectors makes the connection between Good to Great and non-profit organizations more explicit, the findings of Good to Great really are easily adaptable to social organization. While market performance is the metric for measuring success, that is the most strictly business oriented aspect of the book, and was not actually the strongest driving factor for good-to-great companies. Good-to-great companies instead discovered their own metric by which to measure success, closely tied to the unique role they identify for themselves to fill. Rather than focusing on the usual profit per store figure, Walgreens realized that they could be more successful if they measured success by profit per customer visit, which was more in line with their plan for expensive, but convenient store locations (Good to Great 104-8). While Walgreens still uses some measure of profit to quantify their success, it leaves the door open for non-profit organization to develop their own methods of measuring success.
While it’s nice that Good to Great can be so widely applicable, that may also be the book’s biggest fault. In order to make sense in a wide range of organizations, the principles of Good to Great have to be highly adaptive, making Collins’ numerous examples so varied that they sometimes seem rather convenient. When Kimberly Clarke made the gutsy decision to sell its numerous paper mills and devote itself solely to the risky consumer products industry or when Abbott decided move its focus from the potentially lucrative pharmaceutical industry to making affordable healthcare products, Collins explains how each of the Good to Great concepts contributed to the decision to make these shocking, but successful decisions.
However, when the comparison companies make equally drastic changes, they clearly are not operating within the Good to Great framework because their companies didn’t succeed. To be fair, Collins does explain which parts of each company’s plan works and which doesn’t, but it almost seems too neat and tidy that everything a company does right is because of Good to Great while everything wrong is not part of that framework.
One solution to this problem seems to be the concept of the flywheel (“The Fly Wheel and the Doom Loop”). While a company may implement some of the Good to Great concepts, if they don’t continually implement them, they will not achieve the stellar results. Just as one push after the other on a flywheel slowly builds up momentum until the wheel is spinning smoothly when a company begins implementing Good to Great principles, the same can happen when companies make bad decisions, propelling companies downwards rather than upwards.
While I am a little cynical about how clear-cut Collins’ results were, I generally agree with the Good to Great concepts. One point that I found particularly interesting was the chapter “Technology Accelerators,” which addressed our recent obsession on technology as a requirement of a successful business. The comparison companies blindly followed every new technological fad with no real sense of direction. On the other hand, the good-to-great companies were often pioneers in specific applications of technology directly related to their central purpose. The lesson: "Mediocrity results first and foremost from management failure, not technological failure" (Good to Great, 156). If libraries, who often pride themselves on bringing technology to their patrons, can focus the role technology will play for them, they may be able to use their technology funds more efficiently.
The Hedgehog Concept has many applications for libraries. Good to Great explains the Hedgehog Concept as the intersection of the three questions: 1) What is your passion (in other words, what gets you excited)? 2) What can you be best in the world at (in other words, what are you uniquely skilled to do)? 3) What drives your economic engine (in other words, what will make you money) (Good to Great 94-110)? In Good to Great and the Social Sectors Collins modifies the third question slightly by asking “What drives your resource engine?” in other words, how do you ensure you receive the resources you need to continue doing what you’re doing (Social Sectors 18).
While libraries would love to be the one stop information source for everyone, realistically trying to fulfill that mission leaves everyone shortchanged. Assuming librarians have a passion for providing public access to information, that leaves libraries to figure out what role they’re uniquely situated to fulfill in their communities and how fulfilling that role can ensure they will continue to be funded. For example, a branch library in an immigrant neighborhood may realize that there’s a huge gap in ESL training. By helping their patrons learn English, they will be better able to participate in the political process and advocate continued library funding.
Once libraries have their Hedgehog Concepts in place, they can begin to ensure a culture of discipline, part of which involves making a “stop doing” list for all the activities staff devote time to that aren’t a part of your Hedgehog Concept. This is where you really begin to see how well crafted your Hedgehog Concept is. If you were too narrow, then your library can’t justify spending time on legitimate patron concerns, but if you’re too broad, staff are stretched too thin trying to be everything to everyone. Collins’ team found however, that if companies had already followed through on the earlier steps of the good-to-great transition (“Level 5 Leadership,” “First Who … Then What,” and “Confront the Brutal Facts”), then crafting an accurate Hedgehog Concept wasn’t a challenge (Good to Great 139-41). Thinking of the constant struggle in some public libraries to put on programs that will be well attended by the community, I wonder if the discipline of creating a Hedgehog Concept and then sticking rigidly to a “stop doing” list would improve their situation.
Good to Great: Why Some Businesses Make the Leap … and Others Don’t by Jim Collins strikes me as a generally helpful book for library managers. While the room for adaptation makes it easily applicable to library situations, it also put a lot of the work of interpretation squarely on manager’s to figure out exactly what decisions would fit the principles in the book. Still, Collins numerous real world examples provide a range of successful applications that have taken companies from good to great.
Works Cited
Collins, Jim. Good to Great: Why Some Companies Make the Leap ... and Others Don't. 2001. New York: Harper Collins.
Collins, Jim. Good to Great and the Social Sectors: A Monograph to Accompany Good to Great. 2005. New York: Harper Collins.
I read this book for a library management class, but I really ended up enjoying it. The points Collins makes are very useful, but it's not the end-all -be-all of management books