Going From Good to Great

I have been reading a book called Good to Great by Jim Collins which discusses how businesses go from just being a good company to being a great company. It looks at 11 companies over a 30 year period that had average results for the first half, followed by a second half where they outperformed the general stock market by an average of seven times. Remarkable results in other words. I highly recommend reading the book to get the full story, but the findings basically boil down to seven key steps that the companies followed to achieve these results.



#1 Effective Leadership



This does not mean a celebrity CEO who dominates the business with their personality. The most effective leaders had an unusual combination of strong professional will (the drive to build a successful company) with a great personal humility, i.e., an ability to take satisfaction from the company’s success, rather than say "Look what I did." These leaders, known as Level 5 Leaders, are extremely ambitious, but their ambitions are tied more into the performance of the company as a whole as opposed to their own abilities. They are more likely to say "We built this success together," than "I built this success."



#2 Find the Right People first, then Figure out Where to Go



In order to build a great business, you have to bring on the right people. These are the ones who share your vision of greatness and are fully committed to doing what is necessary to achieve the company’s goals. This also means you have to eliminate those who are just there for a paycheck. Once you have got the right people in place, then you can figure out exactly where you can guide everyone to.



#3 Take a Hard Look at Reality, but Realize That You Can Succeed



Everything that you attempt will confront obstacles. Every company will have setbacks; every personal goal you set for yourself will have a challenge to overcome. That’s just reality. But every challenge can be surmounted. The discipline is to take a true look around at where you are and what is holding you back, while also maintaining absolute faith that you will find a solution to move forward.



#4 Find Your Basic Principle



There is a lot that goes into this step, but the general idea is that you have to find a simple core concept that fits with what you are truly passionate about, what is the key factor that drives your economic engine, and what can you be the best in the world at. The whole strategy of finding the intersection of those three factors is more than I can cover here, but through having a deep understanding of them will present a single basic principle that has to be applied to the entire business and is the foundation of all business decisions. If an opportunity fits with this principle, then go for it; if not, it can’t be a part of your business. Often in business, diversification can be a bad thing.



#5 Foster a Culture of Discipline



A culture of discipline is about having disciplined people, who apply disciplined thought, and then take disciplined action on opportunities that fit squarely within your basic principle. It does not mean that there is some great dictator who whips everyone into shape. It means that everyone works coherently toward a single purpose. This includes examining actions that need to be stopped. If something is being done that does not fit with the core principle, you must be disciplined enough to cease the action.



#6 Think Differently About Technology



Great companies do not chase the newest technological fad. Technology will not be the great creator of your success. Instead, it is necessary to examine whether some technology fits within your basic principle, and if so, become an innovator in that field. The key point to understand is that technology only accelerates the momentum built through the first 5 stages, it cannot drive momentum by itself.



#7 Consistent Effort in One Direction



Good to Great calls this the flywheel. By pushing on a flywheel consistently in one direction, it builds up speed. But if you push one way for a bit, then turn around and push in a different direction, all progress is lost and you have to start again. By always moving in one direction and building consistent momentum, at some point you hit breakthrough where all your efforts pay off.



While all of these steps were discovered looking at big companies, they apply just as well to the small business entrepreneur trying to build their business. In fact, it could be even more effective by forming the foundation that we start with. We can take advantage of these lessons learned from those who came before us. By building from the ground up with these principles, we can eliminate the fumbling around in the dark trying to discover what works. This provided the blueprint for sustained success and remarkable results attained by great companies, and it would be foolish to not take advantage of that knowledge.



About the Author

Travis Baugh is an internet marketer and coach who teaches people how to use the proven, successful techniques of top producers to make money online. Read more about building a successful company here.