1. Chapter 9 Jonathan Alvarez, Chris Hill, Shawn Stults
Good To Great
Chapter 9
Jonathan Alvarez, Chris Hill, Shawn Stults

2. From Good To Great To Built To Last
When we compare these two books there are four basic conclusions.
Looking at built to last companies. Early leaders followed the good to great framework. Only they did so in small, early stage enterprises

3. From Good To Great To Built To Last
The second is you use good to great to get results, as a start-up or an established organization, and then apply the findings in Built to Last to make them long term.
Sustained Great Results
Enduring Great Company

4. From Good To Great To Built To Last
To create an iconic stature company us must apply the central concept from Built to Last: Discovery your purpose beyond making money and combine this with stimulant progress.

5. From Good To Great To Built To Last
A tremendous resonance exists between the two studies; the ideas from each enrich and inform the ideas in the other.

6. Good to Great in the Early Years
Bill Hewlett and David Packard’s entire founding concept for HP was not what, but who
They made anything as long as it made a technical contribution and would enable them to build a company with like minded people.

7. Core Ideology
Bill Hewlett , was ask what he was most proud of from his career.
He said “ I am most proud of creating a company that by virtue of its values, practices, and success has had a impact on the way companies are managed”
The values: Technical contribution, respect for all and responsibility to the community, and a deeply held belief that profit is not the fundamental goal of the company

8. Core Ideology
Core values are essential for enduring greatness, but it doesn't seem to matter what those values are.
“Core Ideology”= core value + core purpose
Enduring great companies preserve their core values and purpose while the business strategies and operation practices adapt to the changing world.

9. Preserve the Core, Stimulate Progress
Ex. Walt Disney
Preserved Core
-Purpose- to bring happiness to millions, especially children
Values- creativity, attention to detail, preserving the Disney “Magic”
Stimulate Progress
- Started with just a home video recorder and then moved to amusement parks and beyond.

10. 4 Built to Last Concepts
Clock Building, Not Time Telling- Build an organization that can endure and adapt through multiple generations of leaders and multiple product life cycles.
Genius of AND- Embrace both extremes on a number of dimensions at the same time. Don’t choose A or B figure out how to have both A and B.

11. Build to Last Concepts Cont.
3. Core Ideology- Instill Core values and core purpose (reason for being other than just making money) 4. Preserve the Core/Stimulate Progress- preserve the core ideology as an anchor point while stimulating change, improvement, and innovation.

12. Good to Great into Built to Last Level 5 Leadership
Clock Building, Not telling time- Level 5 leaders build a company that can tick along without them, rather than feeding their egos by becoming indispensable Genius of AND- Personal humility AND professional will
Core Ideology- Level 5 leaders are ambitious for the company and what it stands for; they have a sense of purpose beyond their own success Preserve and Stimulate- Level 5 leaders are relentless in stimulating progress toward tangible results; even if it means firing their own brother
Clock and Genius--- the Phillip Morris company and 7 up--- president took full responsibility for failure not passing them blame

13. Good to Great into Built to Last First Who then What
Clock Building, Not telling time- Practicing first who is clock building; practicing first what is time telling
Genius of AND- Get the right people on the bus AND the wrong people off the bus
Core Ideology- practicing first who means selecting people more on their fit with the core values and purpose; then on their skills and knowledge Preserve and Stimulate- Practicing first who means a bias for promoting from within which reinforces the core values
Get the right people on the bus and then focus on strategy

14. Good to Great into Built to Last Confront the Brutal Facts
Clock Building, Not telling time- Creating a climate where the truth is heard is clock building, especially if you create red flag mechanisms
Genius of AND- Confront the brutal facts of your current reality AND retain unwavering faith that you will prevail in the end.
Core Ideology- confronting the brutal facts clarifies the values an organization truly holds as core vs. those that it would like to hold as core Preserve and Stimulate- Brutal facts clarify what must be done to stimulate progress.
Preserve– the subway experiment making police officers ride the subway in NY to and from work

15. Good to Great into Built to Last Hedgehog Concept
Clock Building, Not telling time- 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. Only those values about which you are passionate that you would “NEVER” give them up qualify as truly core. Preserve and Stimulate- Good BHAG’s flow from understanding; bad BHAG’s flow from bravado. Great BHAG’s sit right smack in the middle of the three circles

16. Hedgehog Concept

17. Good to Great into Built to Last Culture of Discipline
Clock Building, Not telling time- Operating through sheer force if personality as a disciplinarian is 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 and Stimulate- When you have a culture of discipline, you can give people more freedom to experiment and find their own best path to results
It is important to make sure that you allow for freedom throughout the company but still having discipline instilled in the core values.

18. Good to Great into Built to Last Technology Accelerators
Clock Building, Not telling time- Technology accelerators are a key part of the clock
Genius of AND- Shun technology fads AND pioneer the application of technology
Core Ideology- In a great company, technology is subservient to core values, not the other way around Preserve and Stimulate- The right technologies accelerate momentum in the flywheel, toward the achievement of BHAG’s
Genius- don’t just use technology as a quick way to get ahead, incorporate it into your everyday business to sustain a sustainable advantage

19. Good to Great into Built to Last Flywheel, Not Doom Loop
Clock Building, Not telling time- The flywheel effect creates the sustained building of momentum, and does not depend on the presence of a charismatic visionary to motivate people
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, as people chronically wonder “who are we and what do we stand for?” Preserve and Stimulate- The smooth consistency of the flywheel and the cumulative building of momentum to a point of breakthrough create the perfect conditions for instilling core values while stimulating change and progress
Genius & Stimulate– Wal-Mart took incremental steps and then took off and have revolutionary results

20. Boeing
Up to the 1950’s only built huge planes for the military –> B-17, B-29 etc.
Dream was to be part of the commerical airline business – but had no presence in the market at the time
“You make great bombers up there in Seattle. Why don’t you just stick to that..”
Bill Allen, CEO
Realized that while they couldn’t be in the airline business in the ’40s, they had gained the knowledge and experience to try and ‘make such a dream possible’ in the ’50s

21. Boeing cont’d
1952 – decided to spend a ¼ of the company’s entire net worth to build a prototype jet for commercial aviation – the Boeing 707.
1990’s – Boeing stood as the absolute, unquestioned greatest company in the commercial airplane industry.
Collins says the key point is that boeing BHAG, while huge and daunting, was not any random goal. It was a goal that made sense within the context of the three circles. Which is broken down further on the next slide

22. Boeing and the Three Circles
Boeing’s executives understood three things:
1) That the company could become the best in the world in commercial aviation
-Even though it had no presence in the market
2) The shift would significantly improve Boeing’s economic standpoint
3) Boeing people were passionate about the idea.
1) That the company could become the best in the world in commercial aviation even though it had no presence in the market to begin with
2) The shift would significantly improve Boeing’s economic standpoint by increasing profit per aircraft model
And 3) that the boeing people were on board and passionate about the idea.

23. Why Greatness? Size doesn’t matter
It’s not the size of your company that matters, it is the value that it brings to its customers.
What if I just want to be successful (good)?
Two answers
And collins is just pointing out that you don’t need a large building or a lot of inventory to bring true value to your customers and community. As long as your company holds value, size doesn’t matter – for example at cardinals sportcenter where I work, one of our main competitors is academy and although they have a much larger store and a lot more of an inventory then we do, our customers choose us because we strive for customer service and a more friendly shopping experience, where in academy you may not see a sales person until you’re checking out.
The first that collins gives talks about how it may be More rare to be great, but it’s not necessarily harder – you just have to focus on the right things.

24. Being great is just as hard as being good
High school cross-country running team
Hedgehog concept was to run great at the end
Example: They would place a coach at the 2- mile mark of a 3.1 mile race
Wouldn’t record each runner’s time – but what place they were in.
Then got “head bones” for the people they passed by the end of the race
And head bones are like a shrunken skull that each kid would collect and add to a bracelet that everyone on the team wore.
So you can see this is an incentive based strategy that taught the runners to pace themselves and to run with confidence so when it did come time to race, they didn’t think they were going to win, they knew it. And they also wanted more headbones.

25. Don’t waste energy First who, then what:
Cross-country coach said she was burdened to try and make racing fun for the runners
Quickly put a stop to it and said “If you’re not passionate about we do here, then go find something else to do”
Number of kids in the program tripled
Wasn’t the coaches setting the goal for a state championship – it was the runners
No need for motivation
Found out that the program was wasting time and resources on things that shouldn’t need to be done
And at first I thought that was weird because I figured that the number of kids would decrease, however, as I thought about it – when I played sports in high school, It wasn’t the field trips and parties that made me join the team, It was the actual sport and competitiveness – and this cross country team wasn’t competitive at all before this coach got there which would definitely be a cause for the few amount of kids in it.
And it just keeps going back to if you have the right people on the bus, the leaders don’t need to set goals like these because each person is on the same page and knows what the ultimate goal is.
And collins says that the point is that ideas work, and when apply them in any situation, they make your life and experiences better, while improving results.

26. The search for meaningful work
Be passionate about what you do.
Level 5 leaders had a tough time answering “Why Greatness?” because it was just an intrinsic value that each of them held.
Never too late to change
Dr bohls has been stressing all semester that if you’re not passionate about what you’re doing then you shouldn’t be doing it. If you’re in the right business then a hard day’s work should be just part of the experience and you should come home everyday looking forward to the next.
Collins says “if you’re doing something you care that much about, and you believe in its purpose deeply enough, then it is impossible to imagine not trying to make it great.”
And I think people need to realize that it’s never too late to change what you’re doing – even the cross country coach had an MBA but said that in the end it had no meaning to her because it just took time for her to figure out that that simply wasn’t what she wanted for her life.