In Good to Great, Jim Collins, the bestselling co-author of Built to Last, explores why some companies with a long history of generally good results can suddenly leap to and maintain “great” results. Kimberly-Clark, Nucor, Walgreen’s and Wells Fargo are some of the “good-to-great” companies that Collins and his researchers studied to determine the key factors behind their jump to exceptional sustained success — defined by Collins as 15 years of cumulative stock returns at least three times the market average. Reprising his methodology from Built to Last, the good-to-great companies were paired with comparable companies in their industry who had stayed at average and sometimes below average results.

From Good to Great

Begin With the People

After a thorough analysis of all the variables that might have explained the different results between the good-to-great companies and the comparison companies, Collins developed a framework that involves three stages: disciplined people, disciplined thought and disciplined action. These three stages are each supported by two key concepts.

The first stage of the process, disciplined people, begins with what Collins calls “Level 5 Leadership.” Level 5 leadership — the highest level of leadership effectiveness — is characterized by two paradoxical attributes: personal humility and professional will. The greatest leaders, Collins writes, are surprisingly humble. They recognize that their success is tied to the success of others. Coupled with this personal humility, however, is an unwavering commitment and determination to reach their goals, Collins writes. It is this blend of humility and determination that was found again and again in good-to-great leaders.

The second concept of the disciplined people stage — “First Who… Then What” — means putting people in front of strategy and vision. In other words, according to Collins, get the right people on the bus and in the right seat (and get the wrong people off) before you decide where to drive the bus.

Disciplined Thought and Action

Disciplined Thought and Action

The disciplined thought stage begins with confronting the brutal facts but never losing faith, Collins writes. This concept is built on what he calls the Stockdale Paradox, named after the highest ranking officer held in the notorious “Hanoi Hilton” prisoner-of-war camp during the Vietnam War, Admiral Jim Stockdale. Stockdale survived because he was realistic about the ordeal ahead, but still completely confident that he would one day be free.

The second component of the disciplined thought stage is the Hedgehog Concept: the mindset that as an organization you must focus on only one specific thing at which you are the best in the world.

The two final components of the framework, making up the disciplined action stage, are; a Culture of Discipline, which eliminates the need for hierarchy and bureaucracy; and technology accelerators, the use of technology to accelerate success. Technology by itself, Collins notes, is never seen as the root cause of greatness in good-to-great companies, but as a key enabler.

The Power of Clear Ideas

The Power of Clear Ideas

Good to Great offers leaders a framework for success that may be deceptively simple — put in the right people, have a realistic and focused mindset and execute with discipline — but supported with rich and valuable concepts. Using carefully selected metaphors and illustrations, Collins leaves his readers with clear images of his key ideas. Business leaders around the world talk today about “getting the right people on the bus.” Good to Great is also universal; these concepts and ideas can be applied to any type of organization of any size involved in any endeavor.

If there exists a must-read business book, this is it.


Reprinted from: Speed Review: Good to Great.  Why Some Companies Make the Leap … and Others Don’t