Good to Great
Ch 9: From Good to Great to Build to Last
Sterling Rose
Justin Simpson
Krista Wells
Gwen Singleton
Wayni Hebert
Four Conclusions
• Jim Collins co-authored “Built to Last”
• They compared their findings from “Built to Last”
and “Good to Great” and formed 4 conclusions
Four Conclusions
• The great companies from “built to Last” followed the good to
great framework but did so as entrepreneurs in small, early
stage businesses instead of CEOs of established companies
• “Good to Great” is a prequel to “Built to Last”
• To establish yourself as a company with iconic stature, discover
your core values and purpose beyond just making money and
combine with the dynamic of preserve the core/stimulate
progress
• The ideas from each book enrich and inform the ideas of the
other. What is the difference between a good and bad BHAG
Good to Great in the Early
Stages of Built to Last
• During the formative years, great companies went
through a process of buildup to breakthrough,
fallowing the good to great framework
• Sam Walton and Wal-Mart
• Entrepreuneur building a great company instead of a
CEO transforming an established company
(Conclusion 1)
• Hewlett-Packard
• Founding concept started with who instead of what
Core Ideology: The Extra
Dimension of Enduring Greatness
• In 1950s HP adapted and operated under core
values. The “HP Way”.
• These values were:
• Technical contribution
• Respect for the individual
• Responsibility to the community
• Belief that profit is not the fundamental goal
The Extra Dimension…..
• HPs “core ideology” is the key factor in transitions
from good to great to built to last.
• The core ideology consists of core values and core
purpose. Profit??
• Great companies don’t exist for the sole purpose of
profit, but to establish healthy company.
• Profits and cash flows are absolute necessity but not
the point of been in business.
The Extra Dimension…..
• Merck developed and distributed a drug that cured
river blindness free of charge in Amazon. Did they
do it for profit?
• “we try to remember that medicine is for the
patient..not for profits, profit follows.”
• There are no right core values for becoming lasting
great company.
The Extra Dimension…..
• There are great companies that don’t have that one
great core value.
• A company doesn’t need to be social responsible,
passionate for its customers, respect for individual or
quality advocator.
• What kind core values a company follows don’t
matter; having one does.
• Have core values, know them, build them into the
organization, preserve them overtime.
The Extra Dimension…..
• Preserve your core ideology and stimulate progress.
• Adapt to a changing world through business strategies
and operating practices while preserving your core values.
Ex. Walt Disney - preserve “Disney Magic”, creative
imagination, attention to detail
McDonalds- Quality, Service, Cleanliness and
Value, honesty and integrity.
• holding core ideology fixed, while changing strategies &
practice over time leads to long lasting greatness.
Concepts in Good to Great
• Level 5 leadership
• First Who…Then What
• Confront the Brutal Facts (Stockdale Paradox)
• Hedgehog Concept
• Culture of Discipline
• Technology Accelerators
• Flywheel, Not Doom Loop
Level 5 Leadership
• Clock Building, Not Time Telling: Level 5 leaders
build a company that can tic along without them
• Genius of AND: Personal humility AND
professional will
• Core Ideology: Level 5 leaders have a sense of
purpose beyond their own success
• Preserve the Core/Stimulate Progress: Level 5
leaders are relentless in stimulating progress toward
tangible results and achievement
First Who… Then What
• Clock Building, Not Time Telling: “First who” is
clock building, “First what” is time telling
• Genius of AND: Right people on the bus AND the
wrong people off the bus
• Core Ideology: “First who” involves selecting people
based on their fit with the core values
• Preserve the Core/Stimulate Progress: Practicing
“first who” means a bias for promoting from within
Confront the Brutal Facts
• Clock Building, Not Time Telling: creating a climate
where the facts are heard is clock building
• Genius of AND: Confront brutal facts AND retain
unwavering faith
• Core Ideology: Confronting the brutal facts clarifies
the values an organization truly holds as core versus
those that it would like to
• Preserve the Core/Stimulate Progress: Brutal facts
clarify what must be done to stimulate progress
Hedgehog Concept
• Clock Building, Not Time Telling: The council
mechanism is consummate clock building
• Genius of AND: Deep understanding AND
incredible simplicity
• Core Ideology: The “what you are passionate about”
circle overlaps with core values and purpose
• Preserve the Core/Stimulate Progress: Good
BHAGs flow from understanding; bad BHAGs flow
from bravado.
Culture of Discipline
• Clock Building, Not Time Telling: Building an enduring
culture of discipline is clock building
• Genius of AND: Freedom AND responsibility
• Core Ideology: A culture of discipline ejects those who
do not share the values and standards of an organization
• Preserve the Core/Stimulate Progress: When you have a
culture of discipline, you can give people more freedom
to experiment and find their own best path to results
Technology Acceleration
• Clock Building, Not Time Telling: Technology
accelerators are a key part of the clock
• Genius of AND: Shun technology fads AND
pioneer the application of technology
• Core Ideology: Technology is subservient to core
values
• Preserve the Core/Stimulate Progress: The right
technologies accelerate momentum in the flywheel
Flywheel, Not Doom Loop
• Clock Building, Not Time Telling: The flywheel effect
creates the sustained building of momentum
• Genius of AND: Evolutionary, incremental process
AND revolutionary, dramatic results
• Core Ideology: The doom loop makes it almost
impossible to instill core values and purpose
• Preserve the Core/Stimulate Progress: The smooth
flywheel and building of momentum create the perfect
conditions for instilling core values while stimulating
change and progress
BHAGs & the three circles of
the Hedgehog Concept
• BHAGs (“Big Hairy Audacious Goal”)
• A huge and daunting goal that serves as a unifying
focal point of effort.
• Hedgehog Concept
• What are you deeply passionate about?
• What can you be the best in the world at?
• What drives your economic engine?
Bad BHAGs vs. Good BHAGs
• Bad BHAGs
• goals set with bravado
• Good BHAGs
• goals set with understanding
• When you combine quiet understanding of the three
circles with the audacity of a BHAG, you get a
powerful mix.
Boeing
• Boeings BHAG was not random, it made sense within
the context of the three circles.
• To remain great over time requires……..
1.
2.
staying squarely with in the three circles
being willing to change the specific manifestation of what's
inside the three circles at any given moment.
• Boeing never left the three circles or abandoned its core
ideology.
• It created an exciting new BHAG and adjusted its
hedgehog concept to include commercial aircraft.
Creating Greatness that Lasts
• Requires all the key concepts from Good to Great &
Built to Last, applied consistently over time.
• If you ever stop doing any one of the key ideas, your
organization will inevitably slide backward toward
mediocrity.
• It is much easier to become great then to stay great.
• Consistent application of both studies, Good to
Great & Built to Last, gives the best chance for
greatness that lasts.
Why Greatness?
• Greatness doesn’t depend on size.
• “…I don’t really want to build a huge company…”
• Set a standard.
• Ex) generate the highest profit per foot of space
• It is no harder to build something great than to build
something good.
• “..why should I try to build a great company? What if I just
want to be successful?”
• Much of what we’re doing is at best a waste of energy. Don’t
“add” these findings to what we are already doing to make
ourselves more overworked.
Why Greatness?
• We run best at the end
• What we don’t waste time on
• Leadership and Teamwork; accountability
• “First, who.” – the right ‘who’.
• People want to be a part of the spinning flywheel –
the championship team
Why Greatness?
• Not everyone can be above average
• Meaningful work
• All that matters is that you do love [what you do] and
that you do care.
• Perhaps your quest to be part of building something
great will not fall in your business life.
Why Greatness?
• The real question is not, “Why greatness?” but
“what work makes you feel compelled to try to
create greatness?”
• If you have to ask, “isn’t success enough?” then
you’re probably engaged in the wrong line of work.
• When all these pieces come together, not only does
your work move toward greatness, but so does your
life. For, in the end, it is impossible to have a great
life unless it is a meaningful life.