Book Review: The Jim Collins Trilogy

Good to Great, Built to Last, and How the Mighty Fall

Across three books, Jim Collins explores the qualities that make some companies visionary and the traps that bring others to their knees. Never have I read so compact a treatment on building great companies as I did with these books.

Good to Great

Good to Great is based on the compiled data of 28 companies: one set of success stories that created and sustained “Greatness” as defined by the book. Plus one set of direct comparison companies paired against the success stories. The data-driven nature of the book is incredibly impressive. In many books, the author is offering an opinion informed by limited experience, but in this case, the book is written from the perspective of empirical analysis.

The qualities of a great company are outlined in detail: Level 5 Leadership, Confronting the Facts, and The Flywheel & The Doom Loop. One of the most surprising findings of the book is in styles of leadership. Contrary to most anecdotal accounts, personality-driven leadership focused on a big ego and bombastic approach is a negative indicator of success. It’s better to have an evidence-based leader with a measured approach — even to the point of being quiet and reserved. Far from the stereotype of a charismatic superstar.

The book’s principle of “First Who Then What” is apparent at LiveTiles. “Getting the right people on the bus” starts with the hiring process and is sustained by the arrangement of resources and teams. We are benefitting from five years of selection and alignment, ready to take on the next stage of growth at the company. Hopefully, we will make the leap from good to great.

Built to Last

Built to Last is the culmination of a six-year research project into what qualities make Visionary companies. Focusing on 18 great companies and each with a comparison “good” company, the book unravels what it takes to sustain success for decades.

Each chapter describes a new lasting quality: No “Tyranny of the Or”, More Than Profits, and Preserve the Core/Stimulate Progress. Justification for each of these is presented through both compelling numbers and memorable stories from companies exhibiting the trait.

One term I have often heard in meetings is “Big Hairy Audacious Goal”. It turns out that was invented by Jim Collins in this book. Most recently in the MyTRI initiative — a local visioning project to make Tri-Cities, WA a premier destination to live and work — we’ve tried to define and pursue BHAGs across six areas of growth in our region. A city should absolutely be “Built to Last” and I see immense cross-over between its approach to companies and what should be our approach to community.

How the Mighty Fall

How the Might Fall explores the opposite of the first two books: failure and the conditions that predictably lead to it. The shortest of the three books, it looks at how companies erode in market position, valuation, and public perception until they are ultimately relegated to oblivion.

The book presents a 5-stage model for the demise of a company, starting with the hubris of initial success and culminating in surrender to the inevitable decline. Steps in-between outline an escalating calamity that is accelerated by the denial and despair of the company. Contrary to popular perception, the doom of most companies is not brought on by stagnation. Rather, most companies covered in the book succumbed due to an over-exaggerated sense of what they could do as a company. The twin forces of hubris and denial are what’s most dangerous to an organization.

I have been through the failure or many projects and organizations, most of them volunteer in nature. The general theme of the book around losing focus on fundamentals causing a slow collapse resonates with my experience. Hopefully, the next time I see warning signs, I will speak up and act.

Conclusion

In three books, Jim Collins outlined the complete life-cycle of both success and tragedy in business. These books share persuasive data and powerful stories, incisively describing a world where companies should have humble leaders, laser focus, and a vision for lasting into the future. I would recommend them to anyone in leadership or management, trying to drive an organization forward as a force for growth and greatness in the world.

Erik Ralston is Chief Architect at LiveTiles where he leads the team building the world’s only Intelligent Experience Platform (IXP). Erik is also co-founder of Fuse Accelerator in Tri-Cities, WA where he works on connecting people and sharing knowledge to turn new ideas into growing startups. You can find him on LinkedIn, Twitter, or the next Fuse event.