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.staying squarely with in the three circles 2.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.