Business book summary #8: “Good to Great” by Jim Collins

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Martin Waxman and I sat down to discuss what social media can learn from Good To Great. If you haven’t read the book, watch the summary above (12 minutes viewing time) and you’ll be ready to listen to the conversation.

Martin is the managing partner of a fantastic “new” (re: recently merged) PR firm called Energi. They are based out of Toronto and Montreal, and have a very strong digital communication practice.

The Interview

The Top 5 Things Social Media can learn from Good to Great

  1. Level 5 leadership still exists and can still be effective. Level 5 leadership is the antithesis of the great, egocentric (re: Steve Jobs) leader.  As Jim Collins explains it, they are someone who embodies a “paradoxical mix of personal humility and professional will.”  The last thing you would think you’d find on the social web is personal humility.  I could only think of one leader who I thought had both personal humility and what I would consider “web celebrity” - Tony Hseih from Zappos.  Martin thought that there was at least two more examples and brought up his Inside PR hosts Gini Dietrich and Joe Thornley, because they do a very good job of promoting other people and sprinkle in personal humility to boot.
  2. Question: is there room on the social web for Level 5 leadership, or are we doomed to a future of egomaniacs?

  3. Having the best questions is better than having the best answers. Yes, you want to have some answers. But more importantly, you want to have the best questions. Jim Collins said that the best companies had leaders who were willing to face the brutal facts. Part of facing the brutal facts is asking a lot of questions so you understand your way out. One of the “brutal facts” about the social media space at the moment is that there are very few people who are truly asking the difficult questions around ROI. Most discussions tend to skirt the issue. We agreed that we’d all be better off asking the tough questions so that we can eventually get to the answers. If you want a start on that direction, Olivier Blanchard has a great presentation on social media ROI.
  4. Question: what brutal facts are the social media space not confronting?

  5. Jumping on the social media bandwagon is not the answer. The Good to Great companies in Collins’ study avoided technology fads and bandwagons, yet they become pioneers in the application of carefully selected technologies. The easy thing to do would be to look at all your friends and competitors racing to get a Twitter account and Facebook page and think that you need to do the same thing to survive. The hard thing to do would be to take a good long look at what your business goals are, figure out if these tools can help you achieve them, and then have the courage to say “no, I’m not doing this”. At the very least, don’t do it until you can clearly articulate the benefit it will drive to your bottom line.
  6. Question: would you ever tell a client they SHOULDN’T join the “big” social networks?

  7. Your “hedgehog” has to include your economic engine. Collins found the the Good To Great companies became incredibly good at living at the intersection of 3 main things: their passions, what they could be best in the world at, and what made them money. Of course, “living your passion” is all the rage in the social media world. A little less attention is being paid to what you can be best in the world at. And finally, I argue, there’s not enough attention being placed on what can make people money. There’s NO DOUBT that for too long people have been living lives that have made them miserable, forced upon them by a system that views workers as numbers. That type of soul-sucking existence isn’t good for anybody, no matter how much money you make. But if you are going to strike out on your own and change the world, make sure your model takes into account how you are going to keep the lights on in the factory.
  8. Question: can you build a great life and/or business without paying attention to how much money it will make you?

  9. Becoming a great company takes time. Good companies do not become great companies overnight. Yes, there are numerous examples of what might seem like overnight successes (like Gary Vaynerchuk, for instance), but each and every transformational story begins with one thing: the long hard road to success. Collins refers to the Flywheel and the Doom Loop. One way or another, you’re like a hamster in a cage, slowly but surely getting the wheel in motion. You’re either headed to success or failure. However, once the wheel is set in motion, momentum starts to take over. The toughest part is the beginning, where things are moving much, much slower than you’d hoped for. The same thing applies to success with social media - don’t expect overnight success stories. But what you can achieve in the mid-long term will surpass even your wildest dreams.
  10. Question: can you achieve overnight business success with social media?

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    You will also have to give your hamster a wheel which he will use for exercise. Wheels can be free-standing or may attach to the side of the cage. You can also construct different levels inside the cage; just make sure that your hamster can fall no more than 12 inches (10 cm).
  • marc
    Jim Collins book is good but not great. It is vague and looking back at the content he seems to be off in his research. 3 of his 11 companies imploded-Circuit City, Fannie Mae and Gilette. Humility is over rated in Level 5.
  • cynthia
    Super great summary. Thanks
  • douglassemenick
    can we get this on pod casts?
  • You sure can. Type "readitfor.me" into the search box in iTunes and it should be the only result. Let me know how that works for you.
  • Yves Beaudoin MBA
    Excellent «résumé»!

    Thanks!
  • Ash
    Thanks again Steve -

    I appreciate these wee summaries very much.

    Sorry to be a pedant, but...

    You can persevere TO (until) the the end, but it doesn't really make sense to say that you will preserve IN the end:

    persevere |ˌpərsəˈvi(ə)r|
    verb [ intrans. ]
    continue in a course of action even in the face of difficulty or with little or no prospect of success : his family persevered with his treatment.

    Keep up the great work - I'd like to recommend William Isaacs 'Dialogue and the art of thinking together" for precis

    with all good wishes
    Ash
  • steve
    Ash - thanks for the kind words! Thanks for pointing out that mistake - I resolve to use persevere correctly in all future episodes ;-)
  • Moses
    Love the way you have not only distilled the book, but have added your gems of insights to it as well. This is more than good, it is great!
  • steve
    Thanks Moses - I'm glad you enjoyed it.
  • Burt Schraga
    The best business book written this decade. It is required reading at our company.
  • steve
    It's certainly one of my favourites, and gives lots of food for thought. I think should be required reading at ALL companies.
  • Rob E
    Steve,
    Great summary, brought it all back for me.Particularly timely in light of our economic reality...He should have taken your calll...If he had ,he would have said " Great Job"!
  • steve
    Thanks Rob! I agree - in light of our economic reality (and also the technological reality) this really is a great return to the foundations of what we do.
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