Good to Great: Chapter 8 – Key Points

Posted on February 17th, 2009 by Brian Sparks.
Categories: Book Notes, Good to Great, Leadership.

  • Good-to-great transformations often look like dramatic, revolutionary events to those observing from the outside, but they feel like organic, cumulative processes to people on the inside. The confusion of end outcomes (dramatic results) with process (organic and cumulative) skews our perception of what really works over the long haul.
  • No matter how dramatic the end result, the good-to-great transformations never happened in one fell swoop. There was no singing defining action, no grand program, no one killer innovation, no solitary lucky break, no miracle moment.
  • Sustainable transformations follow a predictable pattern of buildup and breakthrough. Like pushing on a giant, heavy flywheel, it takes a lot of effort to get the thing moving at all, but with persistent pushing in a consistent direction over a long period of time, the flywheel builds momentum, eventually hitting a point of breakthrough.
  • The comparison companies followed a different pattern, the doom loop. Rather than accumulating momentum-turn by turn  of the flywheel-they tried to skip buildup and jump immediately to breakthrough. Then, with disappointing results, they’d lurch back and forth, failing to maintain a consistent direction.
  • The comparison companies frequently tried to create a breakthrough with large, misguided acquisitions. The good-to-great companies, in contrast, principally used large acquisitions after breakthrough, to accelerate momentum in an already fast-spinning flywheel.

Unexpected Results

  • those inside the good-to-great companies were often unaware of the magnitude of their transformation at the time; only later, in retrospect, did it become clear. They had no name, tag line, launch event, or program to signify what they were doing at the time.
  • The good-to-great leaders spent essentially no energy trying to “create alignment,” “motivate the troops,” or “manage change.” Under the right conditions, the problems of commitment, alignment, motivation, and change largely take care of themselves. Alignment principally follows from results and momentum, not the other way around.
  • The short-term pressures of Wall Street were not inconsistent with following this model. The flywheel effect is not in conflict with these pressures. Indeed, it is the key to managing them.

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Good to Great: Chapter 8 – The Flywheel and the Doom Loop

Posted on February 17th, 2009 by Brian Sparks.
Categories: Book Notes, Good to Great, Leadership.

“No matter how dramatic the end result, the good-to-great transformations never happened to one fell swoop. There was no single defining action, no grand program, no one killer innovation, no solitary lucky break, no wrenching revolution. Good to great comes about by a cumulative process – step by step, action by action, decision by decision, turn by turn of the flywheel – that adds up to sustained and spectacular results” (page 165).

“we kept thinking that we’d find ‘the one big thing,’ the miracle moment that defined breakthough. we even pushed for it in our interviews. But the good-to-great executives simply could not pinpoint a single key event or moment in time that exemplified the transition. Frequently, they chafed against the whole idea of allocating points and prioritizing factors. In every good-to-great complany, at least one of the interviewees gave an unprompted admonishment, saying something along the lines of, ‘Look, you can’t dissect this thing into a series of nice little boxes and factors, or identify the moment of ‘Aha!’ or the ‘one big thing.’ It was a whole bunch of interlocking pieces that built one upon another.’ (page 168)”

“The good-to-great companies had no name for their transformations. There was no launch event, no tag line, no programmatic feel whatsoever. Some executives said that they weren’t even aware that a major transformation was under way until they were well into it. It was often more obvious to them after the fact than at the time” (page 169).

“Then it began to dawn on us: There was no miracle moment” (page 169).

“It’s important to understand that following the buildup-breakthrough flywheel model is not just a luxury of circumstance” (page 172).

“The good-to-great companies understood a simple truth: tremendous power exists in the fact of continued improvement and the delivery of results. Point to tangible accomplishments – however incremental at first – and show how these steps fit into the context of an overall concept that will work. When you do this in such a way that people see and feel the buildup of momentum, they will line up with enthusiasm” (page 174-175).

“Clearly, the good-to-great companies did get incredible commitment and alignment – they artfully managed change – but they never really spent much time thinking about it. It was utterly transparent to them. We learned that under the right conditions, the problems of commitment, alignment, motivation, and change just melt away. They largely take care of themselves” (page 176).

“The good-to-great companies tended not to publicly proclaim big goals at the outset. Rather, they began to spin the flywheel – understanding to action, step after step, turn after turn. After the flywheel built up momentum, they’d look up and say, ‘Hey, if we just keep pushing on this thing, there’s no reason we can’t accomplish X.’ ” (page 176-177).

“When you let the flywheel do the talking, you don’t need to fervently communicate your goals. People can just extrapolate from the momentum of the flywheel for themselves: ‘Hey, if we just keep doing this, look at where we can go!” (page 177).

“Instead of a quiet, deliberate process of figuring out what needed to be done and then simply doing it, the comparison companies frequently launched new programs-often with great fanfare and hoopla aimed at ‘motivating the troops’ – only to see the programs fail to produce sustained results. They sought the single defining action, the grand program, the one killer innovation, the miracle moment that would allow them to skip the arduous buildup stage and jump right to breakthrough” (page 178).

Signs that You’re In the Doom Loop

  1. Implement big programs, radical change effors, dramatic revolutions; chronic restructuring – always looking for a miracle moment or new savior.
  2. Embrace fads and engage in management hoopla, rather than confront the brutal facts.
  3. Demonstrate chronic inconsistency – lurching back and forth and straying far outside the three circles.
  4. Jump right to action, without disciplined thought and without first getting the right people on the bus.
  5. Run about like Chicken Little in reaction to technology change, fearful of being left behind.
  6. Spend a lot of energy trying to align and motivate people, reallying them around new visions.

“It all starts with Level 5 leaders, who naturally gravitate toward the flywheel model. They’re less interested in flashy programs that make it look like they are Leading! with a capital L. They’re more interested in the quiet, deliberate process of pushing on the flywheel to produce Results! with a capital R.
“Getting the right people on the bus, the wrong people off the bus, and the right people in the right seats-these are all crucial steps in the early stages of buildup.
“Next, when you attain deep understanding about the three circles of your Hedgehog Concept and begin to push in a direction consistent with that understanding, you hit breakthrough momentum and accelerate with key accelerators, chief among them pioneering the application of technology tied directly back to your three circles. Ultimately, to reach breakthrough means having the discipline to make a series of good decisions consistent with your Hedghog Concept-disciplined action, following from disciplined people who exercise disciplined thought. That’s it” (page 184).

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Good to Great: Chapter 7 – Technology Accelerators

Posted on February 14th, 2009 by Brian Sparks.
Categories: Book Notes, Good to Great, Leadership.

“Twenty percent of our success is the new technology that we embrace…[but] eighty percent of our success is in the culture of our company” (page 156).

“Mediocrity results first and foremost from management failure, not technological failure” (page 156).

“Those who turn good into great are motivated by a deep creative urge and an inner compulsion for sheer unadulterated excellence for its own sake. Those who build and perpetuate mediocrity, in contrast, are motivated more by the fear of being left behind” (page 160).

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Good to Great: Chapter 6 – Key Points

Posted on February 14th, 2009 by Brian Sparks.
Categories: Book Notes, Good to Great, Leadership.

  • Sustained great results depend upon building a culture full of self-disciplined people who take disciploined aaction, fanatically consistent with the three circles.
  • Bureaucratic cultures arise to compensate for incompetence and lack of discipline, which arise from having the wrong people on the bus in the first place. If you get the right pople on the bus, and the wrong people off, you don’t need stultifying bureaucracy.
  • A culture of discipline involves a duality. On the one hand, it requires people who adhere to a consistent system; yet, on the other hand, it gives people freedom and responsibility within the framework of that system.
  • A culture of discipline is not just about action. It is about getting disciplined people who engage in disciplined thought and who then take disciplined action.
  • The good-to-great companies appear boring and pedestrian looking in from the outside, but upon closer inspection, they’re full of people who display extreme diligence and a stunning intensity (the ‘rinse their cottage cheese’).
  • Do not confuse a culture of discipline with a tyrant who disciplines-they are very different concepts, one highly functional, the other highly dysfunctional. Savior CEOs who personally discipline through sheer force of personality usually fail to produce sustained results.
  • The single most important form of discipline for sustained results is fanatical adherence to the Hedgehog Concept and the willingness to shun opportunities that fall outside the three circles.

Unexpected Findings

  • The more an organization has the discipline to stay within its three circles, with almost religious consistency, the more it will have opportunities for growth.
  • The fact that something is a ‘once-in-a-lifetime opportunity’ is irrelevant, unless it fits within the three circles. A great company will have many once-in-a-lifetime opportunities.
  • The purpose of budgeting is a good-to-great company is not to decide how much each activity gets, but to decide which arenas best fit with the Hedgehog Concept and should be fully funded and which should not be funded at all.
  • “Stop doing” lists are more important than “to do” lists. (page 142-143).

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Good to Great: Chapter 6 – A Culture of Discipline

Posted on February 14th, 2009 by Brian Sparks.
Categories: Good to Great, Leadership.

“Freedom is only part of the story and half the truth…That is why I recommend that the Statue of Liberty on the East Coast be supplanted by a Statue of Responsibility on the West Coast.” – Viktor E. Frankl, Man’s Search for Meaning (page 120).

“Most companies build their bureaucratic rules to manage the small percentage of wrong people on the bus, which in turn drives away the right people on the bus, which then increases the percentage of wrong people on the bus, which increases the need for more bureaucracy to compensate for the incompetence and lack of discipline, which then further drives the right people away, and so forth” (page 121).

“Avoid bureaucracy and hierarchy and instead create a culture of discipline. When you put these two complementary forces together – a culture of discipline with an ethic of entrepreneurship – you get a magical alchemy of superior performance and sustained results” (page 122).

responsibility accounting (page 123).

Build a culture full of people who take disciplined action within the three circles, fanactically consistent with the Hedgehog Concept.

  1. Build a culture around the idea of freedom and responsibility, within a framework.
  2. Fill that culture with self-disciplined people who are willing to go to exreme lengths to fulfill their responsibilities.
  3. Don’t confuse a culture of discipline with a tyrannical disciplinarian.
  4. Adhere with great consistency to the Hedgehog Concept, exercising an almost religious focus on the intersection of the tree circles. Equally important, create a ’stop doing list’ and systematically unplug anything extraneous.” (page 123-124)

“The good-to-great companies built a consistent system with clear constraints, but they also gave people freedom and responsibility within the framework of that system. They hired self-disciplined people who didn’t need to be managed, and then managed the system, not the people” (page 125).

“In a sense, much of this book is about creating a culture of discipline. It all starts with disciplined people. The transition begins not by trying to discipline the wrong people into the right behaviors, but by getting self-disciplined people on the bus in the first place. Next we have disciplined thought. You need the discipline to confront the brutal facts of reality, while retaining resolute faith that you can and will create a patyh to greatness. Most importantly, you need the discipline to persist in the search for understanding until you get your Hedgehog Concept. Finally, we have disciplined action, the primary subject of the chapter. This order is important. The comparison companies often tried to jump right to disciplined action. But disciplined action without self-disciplined people is impossible to sustain, and disciplined action without disciplined thought is a recipe for disaster.

“Indeed, discipline by itself will not produce great results. We find plenty of organizations in history that had tremendous discipline and that marhed right into disaster, with precision and in nicely formed lines. No, the point is to first get self-disciplined people who engage in very regorous thinking, who then take disciplined action within the framework of a consistent system designed around the Hedgehog Concept” (page 126).

“People in the good-to-great companies became somewhate extreme in the fulfillment of their responsibilties, bordering en some cases on fanaticism” (page 127).

“Much of the answer to the question of ‘good to great’ lies in the discipline to do whatever it takes to become the best within carefully selected arenas and then to seek continual improvement from there” (page 128).

“Everyone whould like to be the best, but most organizations lack the discipline to figure out with egoless clarity what they can be the best at and the will to do whatever it takes to turn that potential into reality. They lack the discipline to rinse their cottage cheese” (page 128).

“It takes discipline to say ‘No, thank you’ to big opportunities. The fact that something is a ‘once-in-a-lifetime opportunity’ is irrelevant if it doesn’t fit within the three circles” (page 136).

“Most of us lead busy but undisciplined lives. We have ever-expanding ‘todo’ lists, thrying to build momentum by doing, doing, doing – and doing more. And it rarely works. Those who built the good-to-great companies, however, made as much use of ’stop doing’ lists as ‘to do’ lists. They displayed a remarkable discipline to unplug all sorts of extraneous junk” (page 139).

“In a good-to-great transformation, budgeting is a discipline to decide which arenas should be fully funded and which should not be funded at all. In other words, the budget process is no about figuring out how much each activity gets, but about determining which activities best support the Hedgehog Concept and should be fully strengthened and which should be eliminated entirely” (page 140).

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Do the Right Thing – Mike Huckabee

Posted on February 14th, 2009 by Brian Sparks.
Categories: Book Notes, Christian Living, Do the Right Thing.

“Freedom can’t exist in a moral vacuum. It mighyt make some on the left uncomforable to admin it, but without clear boundaries of right and wrong, the very concept of liberty breaks down” (page 30).

“Character has been defined as ‘what we are when no one but God is watching.’ Character is believing that even if I don’t ‘get caught,’ the rightness or wrongness of an action is more about the action itself and not just the discovery of it by others.
“As I govern myself and restrain from behavior that hurts others, whether the hurt is physical, emotional, or financial, it will be unnecessary to have outside forms of government monitoring, judging, and, if necessary, correcting my behavior. Without my own conscience-driven ‘internal government’ forming my adherence to a principled and precise moral code, an external government will be required to not only create those definitions of what is right and wrong (legistlative), but to enforce them upon me (executive) and to make sure that those who do the governing are doing so according to rigid principles itself (judicial)” (page 30-31).

“Washington and the Founders believed that America should have, as Thomas Jefferson said in his first inaugural address, ‘a wise and frugal Government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned.
“That is, a government that is lean but not mean. In the Founders’ view, public servants would not get paid much and would not stay long. They would have to go home, to live under the taxes and rules that they created while in Washington. Now, that was a check and balance!” (page 64).

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Masterlife: The Disciple’s Cross, Week 6 day 4

Posted on January 30th, 2009 by Brian Sparks.
Categories: Discipleship, Masterlife.

The gospel which we have in the Bible is the gospel of the Kingdom of God. It presents Jesus as king, as Lord, as the maximum authority. Jesus is at the very center. The gospel of the Kingdom is a Christ-centered gospel.

But in recent centuries we have been hearing another gospel-a man-centered, human gospel. It is the gospel of the big offer. The gospel of the hot sale. The gospel of the irresistible special deal…We have told people, “If you accept Jesus, you will have joy, you will have peace, health, prosperity…If you give Jesus ten dollars, you will get twenty dollars back.”…We are always appealing to man’s interests. Jesus is the Savior, the Healer, and the King coming for me. Me is the center of our gospel.

We take all the verses we like, all the verses that offer something or promise something-John 3:16, John 5:24, and so forth – and we make a systematic theology from these verses, while we forget the other verses that present the demands of Jesus Christ…Who said we were allowed to present only one side of Jesus?…He is our Savior and our Healer, true. But we cannot cut Jesus Christ into pieces and take only the piece we like the best.

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Quotes

Posted on November 10th, 2008 by Brian Sparks.
Categories: Book Notes, Quotes.

“It remains to be seen what God will do with a man who gives himself up wholly to Him” – Henry Varley. “I will be that man” – D.L. Moody in response. (Masterlife, The Disciple’s Cross, page 11).

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Good to Great: Key Points

Posted on November 5th, 2008 by Brian Sparks.
Categories: Good to Great, Leadership.

  • To go from good to great requires a deep understanding of three intersecting circles translated into a simple, crystalline concept (the Hedgehog Concept);

Three Circles of the Hedgehog Concept

  • The key is to understand what your organization can be the best in the world at, and equally important what it cannot be the best at-not what it “wants” to be the best at. The Hedgehog Concept is not a goal, strategy, or intention; it is an understanding.
  • If you cannot be the best in the world at your core business, then your core business cannot form the basis of your Hedgehog Concept.
  • The “best in the world” understanding is a much more severe standard than a core competence. You might have a competence but not necessarily have the capacity to be truly the best in the world at that competence. Conversely, there may be activities at which you could become the best in the world, but at which you have no current competence.
  •  To get insight into the drivers of your economic engine, search for the one denominator (profit per x or, in the social sector, cash flow per x)that has the single greatest impact.
  • Good-to-Great companies set their goals and strategies based on understanding; comparison companies set their goals and strategies based on bravado.
  • Getting the Hedgehog Concept is an iterative process. The Council can be a useful device.

Unexpected Findings

  • The good-to-great companies are more like hedgehog-simple, dowdy creatures that know “one big thing” and stick to it. The comparison companies are more like foxes-crafty, cunning creatures that know many things yet lack consistency.
  • It took four years on average for the good-to-great companies to get a Hedgehog Concept.
  • Strategy per se did not separate the good-to-great companies from the comparison companies. Both sets had strategies, and there is no evidence that the good-to-great companies spent more time on strategic planning than the comparison companies.
  • You absolutely do not need to be in a great industry to produce sustained great results. No matter how bad the industry, every good-to-great company figured out how to produce truly superior economic returns.

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Quotes

Posted on October 20th, 2008 by Brian Sparks.
Categories: Quotes.

“Nothing so tends to inflate a person with a sense of his or her own importance as the possession of great gifts of intellect or the enjoyment of special and unusual experiences. And nothing more surely disqualifies someone for spiritual usefulness than pride” (J. Oswald Sanders, Master Work Winter 06-07, taken from A Sufficient Grace, pg. 7).

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