Good to Great is a best-selling business book by Jim Collins that was first published in 2001. More than 15 million copies of the book have been sold.
Good to Great outlines a process for transitioning from being a good company to a great company. The book contains an in-depth case study of several companies that transitioned from being good businesses to great businesses, as well as advice on how other businesses can follow suit.
In this article, we will be discussing the key points, quotes and takeaways from Good To Great.
The Concept of Good to Great
The core concept of Good To Great is that in order for a company to make a significant shift from being a good company to a great company, it must first transform its culture.
A company’s culture is its most important intangible asset, yet it is also the thing that is least understood and least well managed. This important point about culture being the key to transforming a company’s fortunes is what makes this book so valuable and such a classic in the business world.
Good to Great also discusses how to create a “flywheel” effect. This happens when a company’s actions build momentum and produce results that then create more actions that then lead to more results.
The process begins with a group of “disciplined people” who are then able to create a “disciplined thought process” and, then, a “disciplined action” that allows the company to become a “great company”.
Build a Culture of Discipline
Disciplined people are at the core of a great company. It starts with hiring people who share the company’s vision and align with its core values.
It must then become a culture of high standards, where people are held to high expectations in terms of their behaviours.
This is where you need to instil a certain level of fear in every one to ensure that everyone is doing what they’re supposed to do. At the same time, it must be balanced with a degree of comfort to create a culture of trust.
It must also be a culture of candour, where people feel comfortable challenging each other and expressing opinions and views.
There are many ways to build a culture of discipline. You can create a core philosophy, which is geared toward setting goals, creating strategy, and prioritizing tasks. Or create a core ideology, designed to instil a set of values in employees. You can also create a core concept, which is a set of standard procedures and practices that everyone in the company follows.
Turn Good Practices into Great Habits
At some point, a company does not need a new strategy or new ideas. It needs to execute what it already knows.
The key to becoming a great company is to instil great habits in your employees. These are daily practices and rituals that keep people focused on executing their core strategies and goals.
You can do this by having people do a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis of their lives to clarify what the most important daily habits are.
Another important habit is having people do a monthly review, where they go over their goals, progress to date, and challenges. Or create a weekly rhythm whereby people plan out their week and have time for reflection. You can also implement regular strategy sessions where people review the company’s overall strategy and specific goals.
If you want to learn more about building good habits I highly recommend you read “Atomic Habits” by James Clear. You can read a summary of Atomic Habits right here.
Define Your Company’s Why
This is one of the most important parts of making the shift from a good company to a great company. It is a core question that every employee should ask themselves before making any decision or taking any action.
The why is the reason behind the company’s existence. It is the reason why the company was founded and why it continues to exist today. The best way to define your companies why is to go back to the founding of your company and the reasons why it was started.
It is important to understand that the why of your company changes over time as the world changes and circumstances change. You should revisit and review the why of your company on a regular basis so that it remains current and relevant.
If you want to learn how to define your Why I highly recommend you read “Start With Why” by Simon Sinek. You can read a Book Summary of Start With Why right here.
Become a Culture of Discipline and Accountability
A disciplined culture leads to greater accountability, which leads to better performance.
It starts with having clear goals and transparent metrics for measuring performance. It also includes having a system of regular feedback and having people hold themselves accountable for achieving their goals.
Another important part of building a culture of discipline and accountability is having a clear system for making decisions to separate the company’s core ideology from its core philosophy. This helps to ensure that decisions are being made based on the correct factors.
Building a culture of discipline and accountability starts with hiring the right people and then giving them the right tools and environment. It then progresses to having regular meetings where people review progress toward goals and discuss roadblocks and challenges. Another important part is setting clear expectations and having people be accountable for meeting them.