Good to Great: Why Some Companies Make the Leap, and Others Don’t
Report by David Smith
How can a good company become a great one? This is the question Jim Collins answers in his book, Good to Great. To find the answer, Collins assembled a team of researchers and set out on a 5-year study of 1,435 established companies to find the ones that made the leap to greatness. To be included on the final list, a company had to make a leap from average results to results of sustained excellence. Specifically, a company had to generate cumulative stock returns that exceeded the general market by at least three times over a span of 15 years! These strict standards eliminated all but the highest performing organizations. Of the 1,435 companies that were studied, only eleven made the final cut. Each of the “good-to-great” companies were then compared to a company in the …show more content…
Great companies excel in these areas.
Disciplined People: To help illustrate the meaning of disciplined people, Collins created the bus metaphor. Great businesses “get the right people on the bus before deciding where they’re going.” In other words, to become great, you first have to fill your company with committed, passionate, self-motivated people before setting a course of action. You can worry about what “seat” (role) that person will occupy later. Equally important is getting the wrong people off the bus. Even if you’re headed in the right direction, having the wrong people on the bus will result in failure.
Disciplined Thought: Having disciplined thought is essential in the transformation from good to great. The Hedgehog Concept is a perfect example of disciplined thought. Hedgehogs know one big trick and they are excellent at it. To be a good-to-great company, you have to be a hedgehog. You have to find out what your “one big trick” should be. This is done by answering three
Report by David Smith
How can a good company become a great one? This is the question Jim Collins answers in his book, Good to Great. To find the answer, Collins assembled a team of researchers and set out on a 5-year study of 1,435 established companies to find the ones that made the leap to greatness. To be included on the final list, a company had to make a leap from average results to results of sustained excellence. Specifically, a company had to generate cumulative stock returns that exceeded the general market by at least three times over a span of 15 years! These strict standards eliminated all but the highest performing organizations. Of the 1,435 companies that were studied, only eleven made the final cut. Each of the “good-to-great” companies were then compared to a company in the …show more content…
Great companies excel in these areas.
Disciplined People: To help illustrate the meaning of disciplined people, Collins created the bus metaphor. Great businesses “get the right people on the bus before deciding where they’re going.” In other words, to become great, you first have to fill your company with committed, passionate, self-motivated people before setting a course of action. You can worry about what “seat” (role) that person will occupy later. Equally important is getting the wrong people off the bus. Even if you’re headed in the right direction, having the wrong people on the bus will result in failure.
Disciplined Thought: Having disciplined thought is essential in the transformation from good to great. The Hedgehog Concept is a perfect example of disciplined thought. Hedgehogs know one big trick and they are excellent at it. To be a good-to-great company, you have to be a hedgehog. You have to find out what your “one big trick” should be. This is done by answering three