Good to Great by Jim Collins
The One Thing You Need to Know by Marcus Buckingham
Collins has written another book that holds promise for potential impact. I found the following review about his new book. Hope to pick it up soon and give it a read.
In his newest title, How the Mighty Fall, Jim Collins peers into the causes underlying the decline of greatness. In light of our economic plight, one of Collins' observations loudly rings true. He identifies the "undisciplined pursuit of more" as a key stage in the breakdown of a once-mighty business or nation. In doing so, he makes three points worthy of a closer look.
1) Fear Excessive Ambition More Than Idleness
In examining the histories of companies that regressed from great to good, Collins expected complacency or loss of initiative to be a common denominator. Instead, research showed the reverse to be true. As opposed to laziness, "Overreaching much better explains how the once-invincible self-destruct."
Collins points to Rubbermaid to illustrate. In the mid-'90s Rubbermaid committed itself to introducing a new product every day of the year. Although the company won acclaim for innovation, it abandoned cost discipline along the way. In its efforts to develop thousands of new products, Rubbermaid lost its grip on core competencies and eventually sunk into bankruptcy.
2) Do Not Confuse Growth with Excellence
Collins recounts Merck's decline as a cautionary tale of a company who floundered after pursuing a growth-above-all strategy. In 1995, Merck chose growth as its number one organizational objective. Chasing the holy grail of growth, Merck bet heavily on the success of prescription drug, Vioxx at the turn of the century. Bent on expansion, Merck neglected to investigate troubling data on the cardiovascular risks associated with Vioxx. As time went on, concerns about Vioxx became undeniable. Merck did voluntarily pull Vioxx off the shelves, but not before the company had taken a massive PR hit and had suffered a $15 billion drop in market value.
As Collins observes,
"The greatest leaders do seek growth - growth in performance, growth in distinctive impact, growth in creativity, growth in people - but they do not succumb to growth that undermines long-term value. And they certainly do not confuse growth with excellence. Big does not equal great, and great does not equal big."
3) You Grow Only as Fast as You Can Attract the Right People
More often than not, the attempt of a business to grow its operations becomes its undoing. In the words of David Packard, "More companies die of indigestion than of starvation." Why? Most companies don't bring in the right personnel to handle an uptick in business, and they go under as a result. Growth must be staffed with the talent.
Drawing inspiration from HP's co-founder, Collins and his team coined Packard's Law: "No company can consistently grow revenues faster than its ability to get enough of the right people to implement that growth and still become a great company." Internally motivated, self-disciplined people are the foundation for growth. Without them, new business ventures collapse.
In another groundbreaking leadership text, How the Mighty Fall, Jim Collins has hit upon a root cause of organizational / societal decline: The Undisciplined Pursuit of More. To maintain a healthy sense of discipline, leaders ought to be wary of the hazards of excessive ambition. In a similar vein, leaders must put growth in perspective. Bigger isn't necessarily better. Finally, leaders would be wise to realize that growth has to be fueled by the right people. Otherwise, the expansionist urge will bleed an organization of its resources.
While on the topic of good books - may I ask:
What was the last good book that you read?
When did you read it?