Leadership books that never go out of style (2012 edition): Part II

Great by Choice takes a data-driven approach to answering the question “what makes companies successful?” Collins focuses on determining which companies thrive in an environment faced with uncertainty and upheaval.

The key finding of the book is that the companies that were disciplined in their approach to innovation and growth lead the pack. After years of research, Collins and Hansen found these surprising things about successful companies:

• They’re not more creative.
• They’re not more visionary.
• They’re not more charismatic.
• They’re not more ambitious.
• They’re not more blessed with luck.
• They’re not more risk seeking.
• They’re not more heroic.
• They’re not more prone to making big, bold moves.

Instead, successful companies had:

Fanatic Discipline:

Fanatic Discipline includes the “20-mile march”. Collins and Hansen contrast two different teams that were each trying to reach Antarctica first. The team that succeeded did so by establishing a consistent goal of traveling 15 to 20 miles per day, while the team that failed traveled more on nice days and less on bad days. Similarly, the author’s research found companies that stayed focused and delivered consistent results year after year had better financial performance than the comparison companies. In summary, the premise of the “20-mile march” is to create 2 kinds of discomfort.

• The discomfort of unwavering commitment to high performance in difficult conditions.
• The discomfort of holding back in good conditions. Good intentions do not count.

Empirical Creativity:

It was the organizations that “fired bullets not cannonballs”, as Collins says, that were the most successful. A bullet is a low cost, low risk test of the market. Once a bullet has hit the target, then you fire calibrated cannonballs to take on the market.

Productive Paranoia:

Successful companies unexpectedly took fewer risks than their comparison companies, yet produced superior results by preparing ahead of time, obsessively. These companies planned for the worst case scenario and determined what was out of their control. Then, they worked to minimize exposure to such forces.

Great by Choice is a quick read that articulately illustrates lessons for both individuals and businesses striving for success.