What made me read this book:

‘Good To Great’ was yet another recommendation from a mentor! I was in the mood for a ‘zoomed out’ book that didn’t primarily discuss design, research or anything else UX-related. Inadvertently, this book ended up having a lot of overlap with modern design-driven companies - something that I imagine Jim Collins (and others) will write about in the future. After reading Tanner Christensen’s ‘A Designer’s Guide to Interviewing,’ I outlined a goal to better identify companies I would be interested in being a part of in the future; reading this book was a follow-up on that goal.

Certain “great” companies exhibit common characteristics, but what are those and why don’t more companies exhibit these same characteristics?

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The Good To Great Research

Jim Collins neatly outlines years of research via this book. All highly successful companies (a very specific definition was applied when selecting these companies) share some common characteristics: exceptional leadership, incredible hiring practices, being brutally honest about facts, honing in on a very specific value proposition, having a culture of discipline, viewing technology as yet another tool, and honoring past leadership decisions.

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Building “Red Flag Mechanisms”

Collins describes the process that goes into “creating a climate where trust if heard” and describes a few ways of doing so. One, in particular, really got my attention: “building red flag mechanisms.” He discusses a case study involving a system called “shortpay” that alerts a company when something isn’t working:

“You can get a lot of information from customer surveys, but there are always ways of explaining away the data. With short pay, you absolutely have to pay attention to the data. You often don’t know that a customer is upset until you lose that customer entirely. Short pay acts as an early warning system that forces us to adjust quickly, long before we would lose that customer.”

This was a big aha! moment while reading; it feels like an older way of describing why design mature companies are so successful: caring about your users (customers, clients, etc) is just good business. “Red flag mechanisms” can take shape in many ways but at their core are all the same: a clear indication that a company values feedback. Nowadays, this is more expected than out of the ordinary. I appreciate how Collins talks about this: it’s a way of establishing communication channels that make everyone happy: keeping the business viable, making customers happy, and helping employees focus on prioritization.

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Thoughts on the book:

I love sifting through some good research and this was no exception. I appreciate the data provided via the appendix and the summaries of said data placed in context of the chapters. This was a great read and presented a lot of practical tips to help identify great companies. A few stick out in my mind; for example:

“Ten of eleven good-to-great CEOs came from inside the company, whereas the comparison companies tried outside CEOs six times more often.”

In other words, research shows when companies truly hire based on their core values, people stick around and magic happens. One of the values I often see that parallels this is “servant leadership.” I loved the way Collins describes the long-term effects of hiring practices; it is widely talked about as being expensive but rarely talked about as being a values-based decisions entirely. He bluntly states:

“Great vision without great people is irrelevant.”

He expounds on this a little but and also states that getting the right people hired is half of the process; the other half is getting them into the right roles. From my perspective, this doesn’t seem to be as common anymore and seems to contribute to a lot of churn. Lastly, Collins states that technology is an accelerator rather than a creator of greatness, and he goes on to say that:

“How a company reacts to technological change is a good indicator of its inner drive for greatness versus mediocrity. Great companies respond with thoughtfulness and creativity, driven by a compulsion to turn unrealized potential into results; mediocre companies react and lurch about, motivated by fear of being left behind.”

This was the biggest aha! of the whole book. After the last year of companies (and society) reacting to AI becoming widely accessible, it has been fascinating to see use cases emerge in existing tools while others resist the tide of change. On the flip-side, it’s also been interesting to see companies aggressively try to implement it while not fine-tuning it: useless chatbots, etc.

Overall, this was a great read and I look forward to reading his other book: Built to Last.