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Good to Great: Why Some Companies Make the Leap and Others Don't Hardcover – Unabridged, October 16, 2001
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Frequently Bought Together
Five years ago, Jim Collins asked the question, "Can a good company become a great company and if so, how?" In Good to Great Collins, the author of Built to Last, concludes that it is possible, but finds there are no silver bullets. Collins and his team of researchers began their quest by sorting through a list of 1,435 companies, looking for those that made substantial improvements in their performance over time. They finally settled on 11--including Fannie Mae, Gillette, Walgreens, and Wells Fargo--and discovered common traits that challenged many of the conventional notions of corporate success. Making the transition from good to great doesn't require a high-profile CEO, the latest technology, innovative change management, or even a fine-tuned business strategy. At the heart of those rare and truly great companies was a corporate culture that rigorously found and promoted disciplined people to think and act in a disciplined manner. Peppered with dozens of stories and examples from the great and not so great, the book offers a well-reasoned road map to excellence that any organization would do well to consider. Like Built to Last, Good to Great is one of those books that managers and CEOs will be reading and rereading for years to come. --Harry C. Edwards
From Publishers Weekly
In what Collins terms a prequel to the bestseller Built to Last he wrote with Jerry Porras, this worthwhile effort explores the way good organizations can be turned into ones that produce great, sustained results. To find the keys to greatness, Collins's 21-person research team (at his management research firm) read and coded 6,000 articles, generated more than 2,000 pages of interview transcripts and created 384 megabytes of computer data in a five-year project. That Collins is able to distill the findings into a cogent, well-argued and instructive guide is a testament to his writing skills. After establishing a definition of a good-to-great transition that involves a 10-year fallow period followed by 15 years of increased profits, Collins's crew combed through every company that has made the Fortune 500 (approximately 1,400) and found 11 that met their criteria, including Walgreens, Kimberly Clark and Circuit City. At the heart of the findings about these companies' stellar successes is what Collins calls the Hedgehog Concept, a product or service that leads a company to outshine all worldwide competitors, that drives a company's economic engine and that a company is passionate about. While the companies that achieved greatness were all in different industries, each engaged in versions of Collins's strategies. While some of the overall findings are counterintuitive (e.g., the most effective leaders are humble and strong-willed rather than outgoing), many of Collins's perspectives on running a business are amazingly simple and commonsense. This is not to suggest, however, that executives at all levels wouldn't benefit from reading this book; after all, only 11 companies managed to figure out how to change their B grade to an A on their own.
Copyright 2001 Cahners Business Information, Inc.
Top Customer Reviews
Jim Collins and his team have done an enormous amount of interesting work to determine whether a good company can be come a great company, and how. The answer to the former question is "yes," assuming that the 11 of 1435 Fortune 500 companies did not make it there by accident. The answer to the latter is less clear. The study group identified a number of characteristics that their 11 companies had in common, which were much less frequently present in comparison companies. However, the study inexplicably fails to look at these same characteristics to see how often they succeed in the general population of companies. If these characteristics work 100 percent of the time, you really have something. If they work 5 percent of the time, then not too much is proven.
How were the 11 study companies selected? The criteria take pages to explain in an appendix. Let me simplify by saying that their stock price growth had to be in a range from somewhat lower than to not much higher than the market averages for 15 years. Then, in the next 15 years the stocks had to soar versus the market averages and comparison companies while remaining independent. That's hard to do. The selected companies are Abbott Laboratories, Circuit City, Fannie Mae, Gillette, Kimberly-Clark, Kroger, Nucor, Philip Morris, Pitney Bowes, Walgreen, and Wells Fargo.
As to the "how," attention was focused on what happened before and during the transition from average performance to high performance.Read more ›
Collins advocates the Hedgehog Concept - a combination of discovering what you can be best in the world at (Optimal Thinking), what you are passionate about, and what drives your economic engine. Collins states that sustained disciplined action is primarily achieved by "fanatical adherence to the Hedgehog Concept and the willingness to shun opportunities that fall outside the three circles." So my question is: How do you identify the best? I recommend Optimal Thinking: How To Be Your Best Self by Dr. Rosalene Glickman as an adjunct to this powerful book to provide the mental resource to identify the best, optimize emotional and financial intelligence and create a corporate culture of optimization. From Good to Greatest to Best!"
I've got several problems with this book, the biggest of which stem from fundamentally viewpoints on how to do research. Collin's brand of research is not my kind. It's not systematic, it's not replicable, it's not generalizable, it's not systematic, it's not free of bias, it's not model driven, and it's not collaborative. It's not, in short, scientific in any way. That's not to say that other methods of inquiry are without merit --the Harvard Business Review makes pretty darn good use of case studies, for example-- but way too often Collins's great truths seemed like square pegs crammed into round holes, because a round hole is what he wants. For example, there's no reported search for information that disconfirms his hypotheses. Are there other companies that don't make use of a Culture of Discipline (Chapter 6, natch) but yet are still great according to Collins's definition?Read more ›
Published in 2001, the book gives us a great opportunity to analyze how much endurance there is in a great enduring company.
Since many of the graphs in the book end in 1998, let's see how the eleven example companies listed in the book did in the next 15 years, from 1998 to 2013.
If a convinced reader of the book bought $1 worth of stock of each company back in 1998, the total return on the portfolio in 2013 would be $19.72.
In comparison, the Dow Jones went from 8,000 to 15,000, so the return on investment of $11 in general market would be $20.62.
It turns out, on average, the "great enduring companies" performed slightly worse than general market in the next 15 years after their big sustained successes.
After the author's praise to the great management teams at the companies which target for sustained long-term growth and build a lasting corporate culture to support the growth, these results are disappointing. In the timelines presented in book, the same portfolio does 8x better than the general market, not 5% worse.
Conclusion: The book is well-written and full of interesting notions and quotes. But its main value today is seeing what happened next to superstar companies scientifically and elaborately picked as examples by a group led by a Stanford scholar. There is no way around a feeling that even these highly educated individuals fell under the spell of success and started to find patterns and laws where there were none.Read more ›
Most Recent Customer Reviews
Excellent read! It's so inline with my understanding of business and life, it's amazing.Published 3 days ago by Amazon Customer
Thoroughly enjoyed this research-driven, easy for anyone to understand book that draws its core thesis from data and real examples. Read morePublished 5 days ago by Amazon Customer
This is definitely a must read for anyone looking for key management techniques to really manage anything great.
Pros: The concepts are intuitive and clear. Read more
I will keep this book as a reference and will re-read the chapter summaries when I need guidance. I highly recommend this book.Published 8 days ago by Garin Pangburn
Thought it was a great book. I work at a company which is going from startup to established, and we are taking a few points away from it. Pleasant readPublished 9 days ago by Jeremy
This was an eye opening book! A nice addition to my growing collection.Published 9 days ago by naptownnomad