From Good to Great to Built to Last-Chapter 9

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Good to Great by Jim Collins Chapter 9: From Good to Great to Built to Last:

Good to Great by Jim Collins Chapter 9: From Good to Great to Built to Last Presented by Team 6 Andrei Gololobov , Laura McMannis , Svetlana Grimes

From Good to Great to Built to Last:

From Good to Great to Built to Last Built to Last examined: * 18 enduring great companies (Johnson & Johnson) * Differences between good and great companies It didn’t answer the question of how to change a good company into a great one When writing “From Good to Great” pretended as if “Built to Last” didn’t exist

How did the two studies relate?:

How did the two studies relate? i . Built to Last leaders followed the good-to-great framework ii. Good to Great is a prequel to Built to Last Established Good to Sustained Built to Enduring Company or + Great Great + Last Great Start-up Concepts Results Concepts Company iii. To make the shift to greatness, apply central concept from Guilt to Last: Core values + purpose beyond making money + preserve the core/stimulate progress iv. Ideas in one enrich and inform ideas in the other

Good to Great in the early stages of Built to Last:

Good to Great in the early stages of Built to Last Enduring great companies went through buildup to breakthrough, following good-to-great framework - Wal-Mart - Hewlett-Packard - Johnson & Johnson

First who…then what:

First who…then what Packard’s Law – No company can grow revenues consistently faster than its ability to get enough of the right people to implement that growth and still become a great company. Personal humility Is important * Warren Buffett’s house bought for $31500.00 in 1957

Core ideology: The extra dimension of enduring greatness:

Core ideology: The extra dimension of enduring greatness Core Ideology “The HP Way”: technical contribution, respect for individual, responsibility to the communities, non-central status of profit - Merck’s non-profit contribution to cure parasites There are no specific core values for becoming an enduring great company

Core values:

Core values How do you preserve the core and yet adapt to a changing world? Embrace key concept of preserving the core/stimulating progress. Johnson & Johnson Change Preserve Initiating Good Management Practices, Medicine Packaging Corporate Social Responsibility

PowerPoint Presentation:

Clock Building, Not Time Telling Endure and adapt across multiple generation Genius of AND Equally embrace extreme ideas and extreme viewpoints Core Ideology Give your organization a sustainable purpose Preserve the Core/Stimulate Progress Keep your core values fixed while at the same time stimulating change from above

Level 5 Leadership:

Level 5 Leadership Clock Building… Sustainable without a Level 5 Leader Genius And Humility and Ambition Core Ideology Ambition but also a sense of greater purpose Preserve the Core… Stimulating progress toward tangible results, no matter the cost

First Who…Then What:

First Who…Then What Clock Building… Create a managerial culture that consistently values getting the right people on the bus Genius And Right people in, Wrong people out Core Ideology Selecting like minded individuals Preserve the Core… Promotion from within

Confronting the Brutal Facts:

Confronting the Brutal Facts Clock Building… Permanent climate where the truth is heard Genius And Confront the facts and maintain self-confidence Core Ideology Clarifies an organizations values Preserve the Core… Once you see the Brutal Facts, you will know what to do

Hedgehog Concept:

Hedgehog Concept Clock Building… The Council Circle (Guidance by the three circles) Genius And Deep understanding, incredible simplicity Core Ideology Which values you are passionate about Preserve the Core… Keep your BHAG directly within the three circles

Culture of Discipline:

Culture of Discipline Clock Building… Operate through sheer personality but make it a permanent trait for future leaders to come Genius And Freedom and Responsibility Core Ideology Eject those who don’t share the organization’s values Preserve the Core… Discipline and then empower

Technology Accelerators:

Technology Accelerators Clock Building… Technology Accelerators Genius And Develop new technologies and shun fads Core Ideology Technology is compliant with core values Preserve the Core… Flywheel can accelerated by carefully chosen technoligies

Flywheel, Not Doom Loop:

Flywheel, Not Doom Loo p Clock Building… A sustained flywheel does not depend on charismatic leaders Genius And Incremental Innovation and Radical Innovation Core Ideology Core values are never consistent in a Doom Loop Preserve the Core… Consistency and momentum of a flywheel is the perfect environment for introducing core values

Johnson & Johnson:

Johnson & Johnson Clock Building… Maintain a consistent set of values with corporate social responsibility in mind. Create a managerial culture guided by a traditional credo Genius And J&J constantly strives to reduce the cost of its products, while at the same time believing in the opportunity to make a sound profit.

Johnson & Johnson:

Johnson & Johnson Core Ideology To provide scientifically sound, high quality products and services to help heal, cure disease and improve the quality of life. Preserve the Core… J&J constantly pushes for new innovations in pharmaceuticals, cosmetics, and professional medical equipment without compromising on its original set of fixed values

A Good BHAG:

A Good BHAG Must be clear, compelling, and easily understood Must serve as a rallying point for all the people in an organization Must capture people’s sense of imagination and fascination

A Good BHAG:



Boeing What are you deeply passionate about Manufacturing aircraft What drives your economic engine Experience with building large aircraft and jet engines What can you be best in the world at Commercial jet manufacturing. Design an aircraft that can carry more passengers at faster speeds Result: Boeing 707, and a continuous line of successful commercial jets

A Good BHAG:

A Good BHAG For a company to have staying power, it must remain within the three circles All concepts within the three circles must be constantly applies and reapplied Any attempt to leave the three circles can make a great company run the risk of loosing its status

Why Greatness?:

Why Greatness? Two Potential Answers No harder to build something great than to build something good . Less suffering Search for meaningful work Provides basis for a great life Remember, Greatness doesn’t matter on SIZE!!!!

Merging the two answers Create Ultimate Greatness:

Merging the two answers Create Ultimate Greatness Utilize the Hedgehog Concept Creates a spinning flywheel Adds more energy into the pool Passion leads to greatness Striving for greatness leads to Level 5 Leadership


Takeaways Enduring great companies preserve their core values and purpose while constantly adapting to local as well as global changes. A good BHAG, above all, must have staying power, which can be achieved if the organization adheres to the three circles of the hedgehog concept. It’s not harder to become great than it is to become good. Do something that you love and are passionate and strive for greatness.

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