Recently completed reading “Great by Choice” the fourth book in the popular series by Jim Collins. In today’s highly uncertain times the authors provide a fantastic perspective on what companies need to do to survive and prosper on uncertainty, instability and challenge. If you’re in an industry facing accelerating change, ever steeper competition, and a constant change, this is a must read!
Not only does Great by Choice deliver some excellent concepts (covered below in more detail), but it draws some very interesting parallels between thriving through uncertainty in business and adventuring/exploration, a personal interest of mine. It’s an interesting point that the same tools one uses to prepare for an adventure or expedition (preparing for uncertainty, discipline, and training) are exactly the same things that enable companies to weather uncertainty and even prosper in these environments.
Moving on to the key concepts…
As with the previous books in the “series” (Good to Great, Built to Last, How the Mighty Fall), Great by Choice focuses on contrasting comparable companies during a specific time period of extremely high uncertainty and change. The companies that were able to thrive in these environments were identified as 10x’ers, and their behavior contrasted against the comparison group.
The first key finding identified is that all 10x’ers showed four related traits: fanatic discipline, empirical creativity, and productive paranoia, all centered around “level 5 ambition”.
- Fanatic Discipline – Being consistent with targets, never over reaching, and being absolutely fanatical about doing things consistently. 10x’ers do not over react, do not over extend, and always maintain focus and consistency.
- Empirical Creativity – Making sure you bet on the right things. 10x’ers consistently made the right choices by thoroughly analyzing potential opportunities and ensuring they made sense before they bet big.
- Productive Paranoia – 10x’ers are always looking for possible new threats and building up large reserves to weather potential trouble. They absolutely believe things will turn against them at the worst possible time and they prepare in advance.
- Level 5 Ambition – The unifying trait at the center of the other three. 10x’ers have an ambition that is bigger than themselves. They serve a higher purpose, and communicate that mission clearly.
To further develop on the model above, the authors went into detail on 5 additional differentiators that were clearly demonstrated by 10x’ers.
- 20 Mile March – In my mind the most important and interesting finding was the “20 Mile March”. 10x’ers were fanatics on setting and meeting performance goals, never over-reaching even when times were good, and never missing targets even in the hardest markets. Setting these consistent targets allowed them to prosper in even the most turbulent environments.
- Fire Bullets, Then Cannonballs – This finding was all about making sure you test and re-test ideas before you bet big. 10x’ers made very few big bets that flopped. They were not likely to jump on fads and very likely to get large returns on their ideas when they did invest.
- Leading Above the Death Line – Managing risk further differentiated 10x’ers from the comparison group. They were able to manage the different types of risk, and built large reserves in case of unforeseen peril. They were also able to zoom out (look at the big picture when something changed) and then zoom back in (execute on a new strategy which great focus) to deliver outstanding results.
- Return on Luck – Much of the analysis done in Great by Choice appeared to be on luck, which turned out to be another fascinating area. 10x’ers were no different in the amount of good or bad luck they encountered, however they were much more effective at getting “return on luck”. Specifically they were able to get great returns on good luck as well as bad.
- SMaC – Specific, Methodical and Consistent, all 10x’ers had a “SMaC recipe” that outlined their model for success. This list of specific operating practices guided all of their decisions, rarely changed, and allowed them to deliver consistent and amazing results.
- Innovation & Unexpected Findings – Each chapter in the book typically concluded with a set of interesting unexpected findings. The most interesting for me was that 10x’ers were NOT more innovative than their comparison companies. In fact they were often less innovative. However, they were much more disciplined and empirical when it came to innovation and having a “baseline” level of innovation, they were able to produce better returns on innovative ventures.
Overall, Great by Choice is a very enjoyable and insightful read. It offers many interesting and surprising findings, and I believe it should be required reading for anyone moving into, or already in a highly volatile and unstable business environment. With the accelerating pace of chance brought about by the internet and globalization, I’m tempted to say this is required reading for any business leader or entrepreneur.
Conclusion: Very Highly Recommend
Buy it from Amazon below, it’s worth the read!
http://www.amazon.com/exec/obidos/ASIN/0062120999/ref=nosim/damianpoltzco-20
Damian