Good To Great

How they Determined Good to Great

Companies
1. The companies had to have experienced 15-year
cumulative stock returns that were at or below the
general stock market, punctuated by a transition
2. Each company had to demonstrate the good-to
great pattern independent of its industry.
3. Each company had to demonstrate a pattern of
results.
4. Each company was compared to other similar
companies that either never made the good-to-great
leap (or made it but did not sustain it), in order to
determine what distinguished the good-to-great
company from all others.

The 11 Good to Great

Companies
1.
2.
3.
4.
5.
6.

Abbott
Circuit City
Fannie Mae
Gillette
Kimberly-Clark
Kroger

7.
8.
9.
10.
11.

Nucor
Phillip Morris
Wells Fargo
Walgreens
Pitney Bowes

What makes leaders great?

Is it their courage?
Their business acumen?
Their expert knowledge?
Their ability to organize?

https://youtu.be/Yk7bzZjOXaM

The Window And The Mirror

Level 5 leaders, inherently humble,
look out the window to apportion credit.

At the same time, they look in the mirror

to assign responsibility.

 It is important to note that the unwavering resolve to change

the world must be committed to doing what should be done.

The ferocious decision takes into account what

needs to be done against the inspired decisions.

From this perspective, negative aspects such as

nepotism appear as mediocrity attributes, which

fail to build up to the will of change.
It must converge professional will to personal

humility while demonstrating diligence and

taking full responsibility of the provided roles.

True or False Questions

Leadership is practiced not inherited, True or
False
True
Change management is eminent despite
qualifications, True or false
True
Success of an organization is pegged on the
executives level of education, True or false
False
Personal attributes highly contribute to ambient
leadership, True or false
True

The Hedgehog Concept

The Hedgehog Concept

In the essay The Hedgehog and the
Fox Isaiah Berlin dividend the world
into two groups called Hedgehogs
and Foxes
Foxes see the world in all its
complexity
They are scattered or defused
Moving on many levels
They never integrate their thinking into
one unifying vision

The Hedgehog Concept

Hedgehogs, on the other hand,
simplify the world into a single idea
or principal that unifies everything
Anything that does not related to a
hedgehogs idea holds no relevance

When pitted against each other the

hedgehog always wins
https://youtu.be/mu7hQLaN9Qg

The Hedgehog Concept

Circles

Three Key Dimensions

What in the world can you be best at?
It might not be something you are doing
now
It is equally important to understand
what you are not best at

What Drives your economic engine?

Search for the one denominator (profit
per x, for example, or cash flow per x)
that has the single greatest impact

Three Key Dimensions

What are you deeply passionate
about?
Good to Great companies did not pick a
direction and then try to encourage
people to become passionate about it
Rather, they decided to do only those
things that they could get passionate
about
They recognized that passion could not
be manufactured

Adaptive Leadership See Yourself

as a System
You are a system yourself just as
complicated as your organization
Many things influence you: your
personality, life experiences, cognitive and
other skills, and emotional makeup
Other people and your organization also
influence your decisions
Understanding what makes up your system
can help you to identify your resources and
constraints

Discuss with a Partner

What are the things that I am best
at?
What are the things I am not best at?
Am I doing the things that I am best
at or am I doing the things that I am
not best at?

Technology Accelerators

 The Hedgehog: The wonderland induced by

technology is no longer a miracle but rather a
question of perception.
Drugstore.com vs. Walgreens, Drugstore.com and
Walgreens each applied technology; however,
Walgreens succeeded in the planned technology.
Good Vs great Technology, Great companies
maximize technological advances before any
competitor while good companies wait for a success
of a company before making investments.
Good Vs great, some of the technological motivators
in good-to-great companies include pursuit of
product superiority, huge bets on new technologies,
and investment in advanced techniques.

 Technology in the good to great companies,

Walgreens, for instance is a satellite
company tailored towards providing unique
needs. It has big investment in Satellite
systems linking stores hence formulating a
giant web of services.
Technology as an accelerator not a creator
of momentum, Good to great companies
pioneer relevant technologies within the
Hedgehog concept. Early technology
industries such as Boeing and Dehavilland,
Titanic, Takeaways did not wholesomely
embrace technology.

 Early technology (Titanic and

takeaways), The 20thcentury theme
of technology gave rise to various
advances including electricity,
nuclear, cars, energy and aviation. In
essence, technology transformed the
World from good to great.
Technology and the fear of being left
behind, focus on the big picture,
which differentiate between great
and good

 Technology bubble, the technology

bubble offered a stage of examining
good to great companies.
The big point, the big point reveals
that technology is not a driver but
accelerator, the breakthrough of the
momentum relies on the choice
https://youtu.be/eiuiCk5oqdM

True or False Questions

1. Technology guarantees success, True or False
Answer: True
2. Technology Does not have any role in creating good
or great companies, True or false
Answer: False
3. Great companies are superior to good companies,
True or False
Answer: False
4. Technology did not have any effect in the early
times, True or False
Answer: False
5. Technology is not a driver but accelerator, True or
False
Answer: True

Criticism
Several of the companies, most notably Circuit City are
no longer doing well
Some people consider famous CEOs like Jack Welch of
GE to not be Level 5 Leaders, but they were still very
effective and well regarded
Quote from Respected Consultant Tom Peters
Point No. 2 is that companies that Jim calls great have
performed well. I wouldn't deny that for a minute but they
haven't led anybody anywhere. I don't give a damn whether
Microsoft is around 50 years from now. Microsoft set the
agenda in the world's most important industry at a critical
period of time, and that to me is leadership, not the fact that
you are able to stay alive until your beard is 200 feet long.

Questions?