Good to Great by Jim Collins

Last updated on September 24, 2020 - My Free Marketing newsletter 👀

Good to Great by Jim Collins is one of those books you always hear about and maybe if you’re an MBA you have read. I finally opened it up and was mostly pleased. It led to 1-2 insights that I already knew but was a healthy reminder.

1. People make ALL the difference.
2. Figure out what you CAN be the best in world at.

In our company AppSumo.com, I think we have done well cause we picked a simple economic engine of get amazing deals and promote them. Still doing the same thing 10+ years later and consistently holding the team to high standards.

From this book it made me reflect on how we hired amazing talent, not be so excitable to chase after new opportunities (this one is tough) and dive deeper into what we can be the best at (and ignore the rest).

Here's the 3 major concepts of leadership, people and hedgehog concept that I took away from the book.....

Leadership

How much would someone have to me not to publish Good to Great?

An awesome question Jim wrote before he published the book. Think everyone should be working on something that matters so much it’d cost a lot for them to stop doing it. For me it’d be writing posts like this 🙂

He talks a lot about Level 5 Leaders. They are incredibly ambitious - but their ambition is first and foremost for the institution, not themselves.

Create a company where people can brag anywhere in the world to say, “I used to work there.”

People

Similar to a professional sports team, only the best make the team.

FIRST got the right people on the bus (and the WRONG people off the bus) and THEN figured out where to drive it. The problem of how to motivate and manage largely goes away with the right people.

3 Major Principles with people in great companies

All great points to re-read over and over. Be selective, act quickly and put your stars in the biggest games.

When in doubt, don’t hire - keep looking

When you need to make a people change, act.

Put your best people on your biggest opportunities, not your biggest problems.

::When we go home, we find our energy diverted by thinking about THAT person, takes energy AWAY from developing the RIGHT people.::

Questions to ask yourself with your current team:

• Would you hire the person again?
• If the person came to tell you that he or she is leaving would you feel terribly disappointed or secretly relieved?

Fill your culture with self-disciplined people who are willing to go to extreme lengths to fulfill their responsibilities.

Hedgehog Concept

This concept is 3 circles that overlap to help you be a great company:

1. What can you be the best in the world at?
2. What drives your economic engine?
   1. If you could pick one and only one ratio - profit per x - to systematically increase over time, what x would have the greatest and most sustainable impact? Profit per mortgage risk level, per local population, per customer, per customer visit.
3. What are you deeply passionate about?

Most of the biggest companies in the world really got great at just 1 thing. I know we believe it's multiple things but really Google makes money on ads, Facebook connects people, Microsoft still on Office / Windows and Amazon mostly off selling items and only later AWS.

Keep a rank-ordered list of proposed entrepreneurial projects that had not yet been funded.

Loved the idea of the rank-ordered list. I know for our company its easy to get excited and rush into long-term projects without comparing a list and the opportunity costs each presents.

::Greatness doesn’t depend on size.::